Middle Man

The speech of the week was made in Boston. The subject was the sins of U.S. labor and management. The speaker was Eric Allen Johnston, 47, kinetic, personable president of the U.S. Chamber of Commerce. To a Founder’s Day dinner of Boston University, which had just given him his fourth LL.D., he said:

“Tonight, I’m going to mention plenty of bad practices by labor; and plenty by management also. . . . But, gentlemen of labor, I’ll tell you something straight. Right now you have a priority at the mourners’ bench. . . . You’re just where we of management were ten years ago.

“What a chance we in management missed! From 1921 to 1930 we had everything all our own way. A friendly Administration in Washington. Low taxes. And a friendly public. And what did we do with our power? On the economic side we gave this country a balloon boom that had to burst. On the moral side we produced men like Insull and Hopson and Musica, who undermined confidence in business.

“So what did we get? Beginning with 1933, we got the biggest public beating that any group of Americans ever took. . . .

“Gentlemen of labor . . . how faithfully you have imitated us of management! From 1933 to 1942 you rode high. You were tops. A friendly Administration in Washington. All sorts of favors fed to you daily from the Washington political table. Management weak and intimidated. So what did you do with your power? On the economic side you gave yourselves a labor boom, regardless of the consequences to any other element in the population. On the moral side you produced men like Browne and Bioff and Scalise who gave all labor a black eye.

“You forgot the very thing we forgot: in the architecture of American society it’s just three jumps from the master bedroom to the doghouse.”

Seven Deadly Sins. To ward off the public beating now beginning to come labor’s way, Businessman Johnston proposed that labor and management “hit the sawdust trail together.” Both groups, he declared, are guilty of “seven deadly sins”: monopolistic practices to crush competitors; autocratic leadership; failure to make proper financial accounting to members, employes and the public; too many strikes, which withhold labor and new inventions from production; violence on the picket line, sometimes incited by management’s hired thugs. The worst economic sin, said Johnston, is restraints on production by “featherbedding” and “slow-downing” designed to make more jobs and make them last longer. Root cause of this evil is fear of layoffs; management must try to give its workers continuous employment, backed by adequate unemployment insurance.

“I say in conclusion just two things to you of management and you of labor.

“One: Go ahead and turn this country into a continuous brawl, and Government will chain you both.

“Two: Make a better choice. Work together and stay free.”

Free Enterpriser. The Boston speech was only one of twelve that busy Eric Johnston made last week. Both the speech and the week were typical. The speech was an almost electrically fresh restatement of old but much neglected truths. Its impact derived from its clarity, frankness and vigor; from Businessman Johnston’s position as head of the traditionally hidebound Chamber, and from his steadily growing personal prestige. Since his election to the Chamber presidency in 1942, he has hopped over the U.S. city by city, to South America, to England, talking constantly at and with businessmen, labor leaders and politicians. In two years he has made himself the liveliest U.S. evangelist of free enterprise.

Born in Washington, D.C., Eric Johnston came by his faith in individual enterprise in the standard U.S. tradition. His tubercular father moved to Montana, then to Spokane, Wash., then on again, this time leaving his wife and small son to shift for themselves. Eric’s working life started when he was scarcely out of rompers. From selling newspapers and running errands he progressed to working his way through high school and the University of Washington by reporting for newspapers, stevedoring in vacations. In World War I he went to the Orient as a Marine intelligence officer, stayed in service until 1922. Then he returned to Spokane to begin his business career as a house-to-house salesman of vacuum cleaners. The first two weeks it was no sale. But the third week things began to break. He went on to open an electrical appliances store. Then he founded Columbia Electric & Manufacturing Co., Wayne-Burnady Co. (electrical contracting and engineering), and bought up Washington Brick & Lime Co.

Since 1942 Johnston has run his four businesses and 1,700 employes mainly by long-distance telephone from Washington or wherever. From his walnut-paneled, richly furnished office in the banklike Chamber of Commerce building a block from the White House, he not only runs the Chamber but also serves as member of the Economic Stabilization Board, the State Department’s Economic Policy Committee and the Management-Labor advisory committees of WPB and WMC. A vigorous but discriminating critic, he remains on good personal terms with most New Dealers and labor leaders. Mrs. Johnston, a boyhood sweetheart, spends about a third of the year with him in his Mayflower Hotel apartment, the rest in Spokane where their daughters Harriet, 17, and Elizabeth, 13, are in high school. Johnston tries to get home one week in every eight.

Polished Diamond. Eric Johnston may well be the White Knight of U.S. Business. His critics find him just a little too good to be true: too handsome, too smooth, too patently on the make. Like other goodwilling gospelers of “cooperation” he dodges—or does not see—fundamental differences of opinion. In a New York Times Hall debate last week between Johnston and U.A.W.-C.I.O.’s shrewd ideologue, Walter Reuther of Detroit, Reuther proposed that Government continue to regiment business and labor in peace as in war, by a Peace Production Board. Johnston, intent on his gospel of cooperation, failed to denounce explicitly Reuther’s attempt to confuse the necessities of total war and democratic peace.

But perhaps Eric Johnston’s critics miss his true significance and value. He lays no claim to being a thinker. “You go around talking to people, experiencing new sights and sounds,” he says, “and you polish yourself like the facets of a diamond.” Eric Johnston is pre-eminently a middleman—a middleman of ideas, a believer in the middle of the road. As such he gets top marks.