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.Toward the end of June, militaryplanners began to shut down nonessential production lines of tanks,trucks, bazooka rockets, and mortar shells.Existing inventories wereto be depleted before new ones were produced.On June 27, GeneralElectric suspended production of its entire Hotpoint line of appliances,idling four thousand workers in Chicago alone.By early July, the steelstoppage had neared crisis stage; industrial layoffs skyrocketed and thesteel reserve for defense needs dwindled to a critically low level.22Under increasing public pressure, and with ominous signs of se-vere economic and military production dislocations appearing, admin-istration officials redoubled their efforts to end the steel strike.OnJuly 16, Defense Production Administrator Henry H.Fowler wroteto Acting Director Steelman of the ODM that the cumulative effectof the consequent losses in steel production has mounted to a pointwhere any further delay in reaching a settlement will have extremelyserious effects upon the mobilization program and the entire civilianeconomy. 23 By mid-July, in fact, the forty-five day steel inventoryceiling established by the CMP was nearly depleted.At the same time,automobile output dropped by more than one-half from the previousmonth, and the Big Three announced even bigger cuts for the last halfof July.In the third week of July, automobile output dropped to a nearpostwar low.24Finally, on July 24, upon the direct intervention of Truman himself,the steel strike was settled.The United Steelworkers won a union shopclause in their contracts and received a 21.5 cent-per-hour increase inwages and fringe benefits.The steel companies received a total priceincrease of $5.20 per ton.The agreement was against the judgment oftop mobilization and stabilization officials.Roger Putnam, Ellis Arnall,and John Steelman all went on record as opposing the final settlement.Their concern, as it had been since the beginning of the crisis, was22.OPS News, June 9, 1952, and July 3, 1952, RG 295, OPS, Central Files, 1952 1953,box 632, file: Daily New Digest, May August 1952, NA; Wall Street Journal, June 9, 1952,1 2; ESA Weekly, June 10, 1952, June 18, 1952, and July 27, 1952, RG 296 Records, Reportsand Secretariat, box 3, file: ESA Weekly Roundup, NA; New York Times, July 3, 1952, 5A.23.Letter to Dr.Steelman, July 16, 1952, RG 277, Records of the National ProductionAuthority, Reference Materials, 1951 53, box 15, file: Steel Crisis, NA.24.ESA Weekly, July 22, 1952, and July 29, 1952, RG 296, Records, Reports andSecretariat, box 3, NA; Donovan, Tumultuous Years, 390. 172 / Truman and Koreathe hike in steel prices.It was clear, however, that the administrationsettled the crisis because of its deleterious effects on the economy anddefense production.Under fire from military planners, Steelman bowedto the pressure and issued a directive raising the ceiling prices on steel.The Council of Economic Advisors estimated that the strike cost thenation some 20 million ingot tons of steel; approximately 520,000 cars(or 12 percent of annual production); and between $600 million and$700 million in lost wages.25The steel crisis resulted in far more than lost production and lostincome, however.The crisis precipitated yet another round of hand-wringing over the growth of executive power and prerogative in an eraof Cold War an era already fraught with state secrecy and civil rightsabuses.Concomitantly, the nation saw in the steel seizure one more signof the apocalypse that the country was becoming a garrison state inwhich there would be no more room for individual property rights.Inthe final analysis, by placing so much emphasis on the steel case, and bygoing toe to toe with the steel companies, administration officials exac-erbated the nation s growing ire toward government controls, handedthe Republicans and conservative Democrats an easy campaign issue,eroded what little public support remained for the Korean War, andmost seriously, severed their last linkage with the liberal business estab-lishment by effectively forcing Charles Wilson to resign.After Wilson sdeparture from the ODM, business demonstrated a growing reluctanceto share its people with mobilization agencies in Washington.In fact,Wilson started a trend; the few long-term mobilization officials still inplace had all resigned or planned to resign by July, including DPAdirector Manly Fleischmann and NPA Administrator Henry Fowler.Naturally, the administration found it increasingly difficult to fill vacantmobilization spots.2625.Memo for the President, July 25, 1952, President s Secretary s Files, General Files,box 264, file: Steelman, John, HSTL; ESA Weekly, July 29, 1952, RG 296, Records,Reports and Secretariat, box 3, NA; Memo to Steelman, July 31, 1952, President sSecretary s Files, General Files, box 264, file: Steelman, John, HSTL.26.For various scholarly viewpoints on the steel case vis à vis presidential power andthe general concept of an imperial presidency see Marcus, Truman and the Steel SeizureCase, especially 228 48, 258 60; J.Lawton Collins, War in Peacetime: The History andLessons of Korea; Louis Henkin, Foreign Affairs and the Constitution; Alton R.Lee, Trumanand Taft-Hartley: A Question of Mandate; Robert S.Rankin and Winfried R.Dallmayr,Freedom and Emergency Powers in the Cold War; Charles Sawyer, Concerns of a ConservativeDemocrat.For the exodus of businessmen and mobilization personnel in general see BusinessWeek (May 3, 1952): 30. Crises of Confidence / 173While the steel case captured much of the nation s attention duringthe first half of the year, the issue of price decontrol occupied the timeof economic stabilization officials.The issue of decontrol, like that ofthe extension of the Defense Production Act, became intertwined withdevelopments in the steel case.As indicated earlier, the Truman admin-istration was partially to blame for that.There was, however, anotherimportant component involved in the public and congressional clamorfor decontrol: the performance of the economy itself [ Pobierz caÅ‚ość w formacie PDF ]
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.Toward the end of June, militaryplanners began to shut down nonessential production lines of tanks,trucks, bazooka rockets, and mortar shells.Existing inventories wereto be depleted before new ones were produced.On June 27, GeneralElectric suspended production of its entire Hotpoint line of appliances,idling four thousand workers in Chicago alone.By early July, the steelstoppage had neared crisis stage; industrial layoffs skyrocketed and thesteel reserve for defense needs dwindled to a critically low level.22Under increasing public pressure, and with ominous signs of se-vere economic and military production dislocations appearing, admin-istration officials redoubled their efforts to end the steel strike.OnJuly 16, Defense Production Administrator Henry H.Fowler wroteto Acting Director Steelman of the ODM that the cumulative effectof the consequent losses in steel production has mounted to a pointwhere any further delay in reaching a settlement will have extremelyserious effects upon the mobilization program and the entire civilianeconomy. 23 By mid-July, in fact, the forty-five day steel inventoryceiling established by the CMP was nearly depleted.At the same time,automobile output dropped by more than one-half from the previousmonth, and the Big Three announced even bigger cuts for the last halfof July.In the third week of July, automobile output dropped to a nearpostwar low.24Finally, on July 24, upon the direct intervention of Truman himself,the steel strike was settled.The United Steelworkers won a union shopclause in their contracts and received a 21.5 cent-per-hour increase inwages and fringe benefits.The steel companies received a total priceincrease of $5.20 per ton.The agreement was against the judgment oftop mobilization and stabilization officials.Roger Putnam, Ellis Arnall,and John Steelman all went on record as opposing the final settlement.Their concern, as it had been since the beginning of the crisis, was22.OPS News, June 9, 1952, and July 3, 1952, RG 295, OPS, Central Files, 1952 1953,box 632, file: Daily New Digest, May August 1952, NA; Wall Street Journal, June 9, 1952,1 2; ESA Weekly, June 10, 1952, June 18, 1952, and July 27, 1952, RG 296 Records, Reportsand Secretariat, box 3, file: ESA Weekly Roundup, NA; New York Times, July 3, 1952, 5A.23.Letter to Dr.Steelman, July 16, 1952, RG 277, Records of the National ProductionAuthority, Reference Materials, 1951 53, box 15, file: Steel Crisis, NA.24.ESA Weekly, July 22, 1952, and July 29, 1952, RG 296, Records, Reports andSecretariat, box 3, NA; Donovan, Tumultuous Years, 390. 172 / Truman and Koreathe hike in steel prices.It was clear, however, that the administrationsettled the crisis because of its deleterious effects on the economy anddefense production.Under fire from military planners, Steelman bowedto the pressure and issued a directive raising the ceiling prices on steel.The Council of Economic Advisors estimated that the strike cost thenation some 20 million ingot tons of steel; approximately 520,000 cars(or 12 percent of annual production); and between $600 million and$700 million in lost wages.25The steel crisis resulted in far more than lost production and lostincome, however.The crisis precipitated yet another round of hand-wringing over the growth of executive power and prerogative in an eraof Cold War an era already fraught with state secrecy and civil rightsabuses.Concomitantly, the nation saw in the steel seizure one more signof the apocalypse that the country was becoming a garrison state inwhich there would be no more room for individual property rights.Inthe final analysis, by placing so much emphasis on the steel case, and bygoing toe to toe with the steel companies, administration officials exac-erbated the nation s growing ire toward government controls, handedthe Republicans and conservative Democrats an easy campaign issue,eroded what little public support remained for the Korean War, andmost seriously, severed their last linkage with the liberal business estab-lishment by effectively forcing Charles Wilson to resign.After Wilson sdeparture from the ODM, business demonstrated a growing reluctanceto share its people with mobilization agencies in Washington.In fact,Wilson started a trend; the few long-term mobilization officials still inplace had all resigned or planned to resign by July, including DPAdirector Manly Fleischmann and NPA Administrator Henry Fowler.Naturally, the administration found it increasingly difficult to fill vacantmobilization spots.2625.Memo for the President, July 25, 1952, President s Secretary s Files, General Files,box 264, file: Steelman, John, HSTL; ESA Weekly, July 29, 1952, RG 296, Records,Reports and Secretariat, box 3, NA; Memo to Steelman, July 31, 1952, President sSecretary s Files, General Files, box 264, file: Steelman, John, HSTL.26.For various scholarly viewpoints on the steel case vis à vis presidential power andthe general concept of an imperial presidency see Marcus, Truman and the Steel SeizureCase, especially 228 48, 258 60; J.Lawton Collins, War in Peacetime: The History andLessons of Korea; Louis Henkin, Foreign Affairs and the Constitution; Alton R.Lee, Trumanand Taft-Hartley: A Question of Mandate; Robert S.Rankin and Winfried R.Dallmayr,Freedom and Emergency Powers in the Cold War; Charles Sawyer, Concerns of a ConservativeDemocrat.For the exodus of businessmen and mobilization personnel in general see BusinessWeek (May 3, 1952): 30. Crises of Confidence / 173While the steel case captured much of the nation s attention duringthe first half of the year, the issue of price decontrol occupied the timeof economic stabilization officials.The issue of decontrol, like that ofthe extension of the Defense Production Act, became intertwined withdevelopments in the steel case.As indicated earlier, the Truman admin-istration was partially to blame for that.There was, however, anotherimportant component involved in the public and congressional clamorfor decontrol: the performance of the economy itself [ Pobierz caÅ‚ość w formacie PDF ]