The Great Depression’s impact
The machinations of foreign and domestic copper markets, the actions taken by producers and the effects of government officials determined to resuscitate the nation’s economy all had a significant impact on the Copper Basin’s industry in the 1930s. As the full impact of the Great Depression’s contraction settled upon its residents; however, Copper Basin company managers, civic and commercial elite, and working people developed different conceptions about what an appropriate response to the crisis should be. Industrial management, businessmen, civic leaders, and workers all wanted stability and protections against further erosion of their economic
circumstance. Rejection of certain New Era standards began as companies now demanded increased government protection from foreign competition. Workers did too, but they also lost faith in rational management approaches designed to counter union organizing. Despite their differing prerogatives, by 1933 desperation led nearly all the key players among capital and labor in the Copper Basin throw their support behind New Deal initiatives and mandates designed to assist industrial management, small businessmen and working people; these groups did so with great fervor and in the hope that a different collection of strategies might yield results. The strategies embraced by these groups all involved some sort of collective enterprise, but ultimately, the ambitions of management and local businessmen diverged from those of many workers. All would have to come to terms with new federal mandates that allowed more legal maneuvering by organized workers than ever before, but which also sought to restore vitality to the nation’s industrial producers.
When the boom of the New Era died in the copper commodities markets, it did so in spectacular fashion. The speculative price of this most important metal for an age of
electrification collapsed in 1931 to about 6 cents per pound, down from highs above 18 cents just the year before. As a result, in 1931, Tennessee Copper and Chemical profits (the name
Lewisohn operations in the Copper Basin assumed for much of the twenties) collapsed from over $1 million to just over $5,000.302
Then the news got even worse because over the next couple of years the contraction only continued. A report from March 1933 stated that U.S. consumption stood at only 27% of 1929 figures. Overseas consumption fell by a third. Corporate losses sustained at Tennessee
Corporation were over $ 759 thousand in 1932 and another $ 97 thousand in the first year of the New Deal. The latter number may reflect tempering effects of new NRA pricing and production codes but only peripherally since it took producers months to redirect their production levels.303
To improve their own positions after the collapse the commodities markets, US copper producers eventually took advantage of federally-mandated associationalism. But, this had not been their first response. Intense competition among producers had regularly compromised the efficacy of their cooperation. Improving markets—however fleeting—had typically revealed the fragility of such associations and producers returned all too soon to cut-throat competition. However, the 1929 Crash and subsequent price collapse in copper shut down many smaller producers and precipitated near panicked calls for protectionism by the industry’s leaders. Further economic deterioration ensued in the copper markets after Congress capitulated to pleading copper barons and threw up the tariff wall of the Hoover era: domestic stocks burgeoned as foreign governments retaliated with their own protective tariffs. In spite of an
302
“Other Corporate Reports” New York Times, 7 September 1931; and 12 April 1932.
303
“Copper Sales Top Output: Consumption in 1932 Fell Most Sharply in United States,” New York Times, 10 March 1933; “Other Corporate Reports, New York Times, 13 April 1933 and 12 April 1934.
embrace of impressive mechanization in the industry and rationalization in its management, the copper industry as a whole needed reforming. Yet even under the intense stress placed upon it during the early 1930s producers came to cooperate only reluctantly. When they did join the Roosevelt Administration’s association schemes as allowed through the National Recovery Administration, they did so on their own terms. Constant wrangling among copper producers over price and production quotas limited short-term benefits to the industry.304
Tennessee Copper Company managed to wrestle much from contracting copper markets despite the Depression’s grip. It used its superior position to overtake its stumbling local competitor through merger and finished the consolidation of non-ferrous production in the Copper Basin. It advanced still further into agricultural chemical production to buoy its bottom line. Regarding labor relations, the goal of TCC management was to preserve the rational organization of production and labor relations established in the 1920s by J.N. Houser at the direction of Sam A. Lewisohn. The Lewisohn-Houser regimen had depended upon a de-facto company union that centered on job safety. Foremen and other supervisory staff directed work through the craftsmen. A phalanx of efficiency made up of smelter, mine, and chemical craftsmen had joined with foremen, engineers, and chemists; together their efforts reduced injuries on the job and had allowed expansion of the company’s production array. As long as copper prices remained strong, wages substantial, and job security somewhat secure this system seemed to work well enough to maintain an industrial peace—despite technology driven
decreases in the need for skilled miners and corresponding increases in unskilled workers. The collapse of the economy in the thirties put enormous stress on the Lewisohn-Houser scheme. Management instituted a stretch-out to prevent desolation of employment rolls but some workers
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thought management could do better. Miners and craftsmen responded positively to their chance to organize on their own terms under the New Deal’s federal protections.305
When the Roosevelt Administration announced and Congress passed the National Industrial Recovery Act in spring 1933, the typically resolute, upbeat, now careworn, Copper Basin civic and business leaders leapt at the chance to support their President—and revitalize local aspirations. For some while, Copperhill and Benton, Tennessee editors had been
admonishing citizens not to heed cynical, negative voices of “depression.” Regular turnover of local newspaper ownership during the early thirties, especially at Copperhill, reflected the failure of this admonishing tactic. Offering hope and collective support through a much more engaging campaign than any scolding could provoke, the New Deal gave these men a chance to leave behind emptier, booster sophistry. A flourish of optimistic patriotism helped galvanize a resolute coalition of Copper Basin businesses. They would do their part in healing the national economy. Periodic Cassandra condemnation of New Deal expense and inflationary pressure sometimes crept into Copperhill editorials, but more of this came from the editor at the county-seat whose constituency had more to lose from the New Deal’s erosion of the rural ancient regime. In the industrial east of Polk County and throughout most of the Tri-State, a general assent to the federal government’s invitation for businessmen to adopt certain NRA codes stood as a prelude to locals’ later enthusiastic support for federal programs like the Tennessee Valley Authority, the Civilian Conservation Corps and US government munitions contracts.306
Workers too had an opportunity for empowerment under the New Deal, first through the 1933 National Industrial Recovery Act and then through the 1935 Wagner Act and subsequent supportive court decisions. Workers took more immediate advantage of these NIRA
305
T.A. Mitchell, Tennessee Copper Company “Labor Relations,” Pinehurst Meeting, October 1946, 1.
306
“Success to the New Administration,” Copper City Advance, 4.7.1933; and, “Copperhill and McCaysville Fall In Line with the NRA Movement,” Copper City Advance, 8.4.1933.
opportunities than had their managers, quickly organizing into unions and putting to the lie any myth management may have come to tell itself that workers had been fully satisfied with
company unions or employee-representative plans instituted in the 1920s. But, by the late 1930s, it was clear that Copper Basin workers could not agree on the best way to protect their interests. Some sought refuge in the new CIO and its industrial organization of workers, while others preferred AFL-style volunteerism and pure-and-simple unionism that sought to maintain a special voice for craftsmen.307
Division in the workforce resurrected anti-communist attacks from within and without labor. Management became frustrated with the intensifying internecine squabbling and used the schism to its advantage. TCC owner, Sam A. Lewisohn had long held that labor ought to be able to organize and that it was critical that management treat labor with respect and consideration of the workingman’s circumstances. Years later, Lewisohn acknowledged there could also be a place for government to enforce mandates guaranteeing workers collectively bargain with employers. For his opinions and for his philanthropic work which underscored his devotion to community uplift, Lewisohn was recognized by the Roosevelt Administration as a model, moderate statesman in the industry. His discussions on the subjects of industrial relations, rational management, and proper wage schemes from the Great War era forward determined not only his company’s policies, but set standards in other industries as well.308
307
Mitchell, Labor Relations, ibid.
308
See, “Business Hope Seen in ‘Statesmanship’,” New York Times, 29 December 1935; also, several addresses and articles by Sam A. Lewisohn, including: “Humanizing the Management of Industry,” Proceedings of the Academy of Political Science in the City of New York, No. 2. War Labor Policies and Reconstruction (Feb 1919): 28-31; “The Living Wage and the National Income,” Political Science Quarterly, Vol. 38, No. 2, (June, 1923): 219-226; Sam A. Lewisohn and Paul H. Douglas, “Factors in Wage Determination—Discussion” The American Economic Review, Vol 13, no 1 Supplement, Papers and Proceedings of the Thirty-Fifth annual Meeting of the American Economic Association (Mar. 1923): 141-146; Sam A. Lewisohn, New Leadership in Industry, New York: E.P. Dutton & Company, 1926; and Sam A. Lewisohn, “What the Employer Can Do: An Employer Charts the Roads He believes will lead toward peace between industry and labor,” New York Times, 7 October 1945.
However, for all his defense of the workingman as a respectable component of industry, Lewisohn’s opinions of how much power a union should have changed over time. Though allowing latitude at his works in the early New Deal, by the late thirties it was clear that
Lewisohn and his management team at TCC were increasingly uncomfortable with some of the demands put forth by Mine, Mill union workers. Lewisohn did not want a union or workers advocates dictating national wage rates for copper workers, nor should unions demand too much control of the shop floor. Wages were to be locally determined based upon particular
circumstances, regional labor markets and commodities prices. Closed shops were not to be allowed and seniority based solely upon time on the job made little sense to him.309
As a result of Lewisohn’s positions, TCC let it be known through its supervisory staff that the company preferred an AFL union over one allied with the CIO. The company then coordinated a phalanx of conservative workers supported by commercial, civic, and police authorities to a push-back CIO influence.310 Members of this confederation saw the future of the TCC as key to their own prosperity. While the warring unions defended their efforts and
competed for sympathetic support among workers and local citizens, Tennessee Copper took advantage of the circumstances. The company managed to forge a new public image for itself that would over-ride earlier perceptions of the company as an exploitive firm, guilty of
destroying countless acres of Appalachia. TCC came to be seen by influential local citizens as the most reasonable voice among an antagonistic, ever shriller, cacophony of organized workers. Commercial and civic support for the New Deal
An April 7, 1933 Copper City Advance editorial pointed readers toward the “brightening skies” over the nation since the installation of its new president. Summarizing the enthusiastic,
309
Lewisohn, , “Factors in Wage Determination” and “What the Employer Can Do,” ibid.
310
Report on the Ducktown (Tennessee) Dynamiting Convictions, Lampell Report, National Committee for People’s Rights December, 1941.
bi-partisan support that existed among the region’s businessmen and citizens for Franklin Delano Roosevelt’s “New Deal,” editor Don King admired the president’s “quickness and
aggressiveness” in addressing the staggering depression—a crisis now in its fourth year. Roosevelt had already impressed King with his handling of the banking crisis the month before since. The president’s actions appeared to herald a new era of balanced budgets and reduced taxes. Prices in the agricultural markets were on the rise: dairy products, hogs and cattle, cotton and tobacco prices, all were going up. “Better days for the farmer,” he reminded readers, “means [sic] better days for the towns… [which] means more sales for merchants and more work for carpenters and bricklayers.” It seemed to King that the nation should follow this man Roosevelt. “Toward every issue he has touched he has exhibited candor and fearlessness.” In wishing the man success King seemed particularly relieved FDR was “laying permanently to rest the fear he might pursue an occasionally radical course.” The presumed direction taken by Roosevelt was important to King. As architect of this “New Deal” King was cheered Roosevelt seemed mindful of certain proven conventions of the American economy; policies would be vast in scope and aim, but also considerate of the associationism initiated in the Hoover era. Its pragmatic,
proactive course, directed by what came to be known as the Brains’ Trust, included advice from businessmen and professional economists. King believed many of his Republican readers could heave a sigh relief over the intentions of the new president. Communism and fascism had
alternately already seduced millions of Europeans, but the new American president had not fallen for these false charmers. Standing like a barometer before his readers and linking health of the economy to the health of the public generally, Don King sent communal salutations from the Copper Basin to the administration. “To wish success for President Roosevelt is simply to wish success for one’s state, one’s business, one’s self.” Well wishes aside, King told his readers he
would stay keen however to any aspects of the new administration’s policies that smacked of dangerous, superficially tempting, anti-capitalist ideology.311
For its part, TCC operators took the lead in July by ending a stretch-out, returning to a five-day work week and providing a 12 ½ percent raise to all workers. The Copper City Advance
said that general manager Houser had decided to take this action in support of NRA codes. Local businesses followed Houser’s lead but with much more enthusiasm. By August that year, the contagious acclaim and excitement behind the New Deal was evident in local headlines. A chorus of local businessmen heeded the president’s call to action as outlined through National Recovery Administration mandates. Full page notices announced the Twin-Cities’ business community support for the Blue Eagle campaign and locals’ intention to adopt NRA codes on operating hours and fair competition. An “Honor Roll for Copperhill, Tenn. and McCaysville, Ga.” listed forty-one of the most important enterprises, banks, offices, shops, grocers, and service stations of the surrounding environs. Kincaid’s Meats and Groceries, A. Maloof & Sons Dry Goods and Clothing, Center & Abernathy Furniture and Hardware, and a dozen or so smaller companies joined with the First National Bank of Polk County, TCC Smelter Stores, local proprietors of the Atlantic & Pacific Tea and Standard Oil companies to proudly stand with their president. Having met in a mass meeting of merchants and civic leaders, the body had pledged its “100 percent cooperation” to the campaign, though it acknowledged that restaurants, drug stores, barber shops, garages, and filling stations were to set their own conditions.
Operating hours across the Basin now became standardized under this “blanket code”: 7:30 AM to 5:30 PM through the work week, Saturday not included. Patriotic symbolism filled the pages of the paper as it announced the new regimen. “We pledge allegiance to the President’s
Program!” announced the business confederation in the Copper City Advance. Recognizing the
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seriousness of this advance, businessmen admonished citizens to rally to this cause: “Service to one’s country in peace is as deserving as service in war!” Acknowledging the importance of the working man in this new scheme, the City Advance announced it was important for all to
remember that a new accord could exist between capital and labor if all followed a “live and let live [policy] thoroughly in accord with the intent of the NRA.” Retailer A. Maloof was all for the Blue Eagle campaign and all its components. “We believe in the NRA 100% and will cooperate to the limit.”312
The national devotion and community-spirit evident in all this stood in stark contrast to the fury some Basinites had expressed earlier that year when an angry, armed mob of 150 men shutdown local highway work to protest imported work crews. Rioters failed to heed threats by the road company (“Reconstruction Finance”) that their officials would call in the state militia. The crowds only retreated after Polk County Sheriff Broughton Biggs explained the level of expertise required for the work. This incident underscored just how angry the Depression’s desperate times had made Tri-State mountain workers. It was also a reminder that local folk had little fear of organizing and arming themselves en masse when their interests appeared
threatened. They would defend what they saw as justice in their economic rights.313
Other signs of the Depression abounded. While it would not be official for some years, the number of persons in the county who could not pay their taxes had exploded, For the year 1931 alone, over two hundred properties went delinquent in Polk County, nearly all these went
312
“Improvements Noted with Tennessee Copper Company,” Copper City Advance, 7 July 1933; “Copper Company Increases Wages,” Copper City Advance, 28 July 1933; “Mr. President! We are Cooperating!” Copper City
Advance, 8.4.1933.
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for auction. In many cases, the taxes owed amounted to less than ten dollars or about two days work, but even this seemingly meager amount represented too much for scores of locals.314
People who could not pay their taxes did not shop as much as they had in the past. Times