The Italian authorities now omit the two great hat makers' strikes in their summary tabulation of results apparently because of the unusual character of the industry and of the relations between employers and employees in it. In this way the proportion of wholly successful strikers in 1896 becomes 49 per cent; of partly successful, 31 per cent, and of unsuccessful, 20 per cent; while the corresponding figures for 1897 become 23 per cent, 45 per cent, and 32 per cent, respectively. This change reduces the average percentage of wholly successful strikers from 1892 to 1898 to 30 per cent; and that of partly successful to 33.1 per cent; while the proportion wholly unsuccessful becomes 36.7 per cent.

The results of strikes for the earlier period, 1879 to 1891, may be compared with those of the period from 1892 to 1898. While 25 per cent of the strikers in the earlier period were wholly successful, the proportion of wholly successful strikers rose to 36.3 per cent in the later period. This great difference is chiefly due, however, to the result of the one wide-reaching strike among the hat makers of Florence in 1896. The proportion of partly successful strikers from 1879 to 1891 was 47 per cent, while in the latter period it was only 37.6 per cent. It seems that the number of strikes which resulted in compromise during the later period was very much less than during the earlier period, and even the fact that the great strike, involving more than 40,000 persons, in the Florence hat trade in 1897 resulted in partial success, fails to bring the proportion of partly successful strikers during the later period up to within 9 per cent of the figure for the earlier series of years. The percentage of strikers who wholly failed was slightly less during the later period, 26.1 per cent, than during the earlier one, 28 per cent; but had it not been for the favorable outcome of the two great strikes of the hat makers, the percentage of failure among the strikers would have been considerably greater in the later period than in the earlier one.

I C-VOL XVII-01-44

APPENDIX.

VIEWS OF VARIOUS WRITERS ON ARBITRATION AND

CONCILIATION.

The following extracts from, and abstracts of, the opinions of various prominent economic writers, labor leaders, and persons who have had experience in regard to conciliation and arbitration, may be of interest. They are given without comment and with no intention of indicating approval or disapproval in presenting

them.

ARBITRATION AND CONCILIATION.

Paper by WILLIAM H. SAYWARD, secretary National Association of Builders, before the Congress on Industrial Conciliation and Arbitration, Chicago, Ill., November, 1894. Report, pp. 81-83. Arbitration, as ordinarily and narrowly interpreted, gives no promise of permanency. Arbitration is a measure which must of necessity comprehend the existence of conditions inimical to permanent peace, and such measures, pacific though they be, if utilized only in their restrictive sense will be found to fall far short of establishing lasting harmony. We must do better than this. We must search for a method of conducting those affairs which are mutually the concern of employer and workman upon a basis that will substitute primary agreements for contest and conflict, and thus anticipate and render unnecessary the operation of palliative methods, which at best are but temporary in their effect.

Consider for a moment what arbitration really means: Arbitration means the settlement of something in controversy; it presupposes disputes which are to be settled by others than those party to the questions at issue; its outcome is almost invariably a compromise, the terms of which are fixed by a third party, and with which one of the disputants at least is quite sure to be dissatisfied. This is not what we are seeking. Let us not be deceived by that which keeps the word of promise to our ear and breaks it to our hope," but probe a little deeper, that the cure may be lasting."

Conciliation, however, may be so understood and applied as to promise and produce results much more permanent and lasting; indeed it has been so used and applied in Belgium and England in some notable instances, where it has been so used as to mean an accepted method of combined action to secure the settlement of affairs of mutual concern; but conciliation, as ordinarily understood and used, signifies that the parties concerned have been permitted to quarrel and need a mediator; our contention is that it is poor policy to allow things to reach such a pass as this. I therefore would be glad to strip from the word all that significance which arouses in the mind a sense of existence of grievances which need to be soothed and alleviated. It is a foolish waste of opportunity to sit idly by while the parties get warmed up to the fighting point and then offer palliative processes to heal wounds that ought never to have been permitted, for the labor and difficulty of handling such questions is thereby increased an hundredfold. ***

The objective point in our study of the labor problem must be to discover some permanent, businesslike method of settlement of all questions of mutual concern between employers and employed that will work with automatic regularity and as a matter of course, thus forestalling all less comprehensive methods of healing breaches by preventing the breaches from occurring.

Now, what is this plan which we believe covers all these points and effects the result hoped for? Comprehensively stated it is simply a plain business method, such as precedes, almost invariably, all commercial transactions where goods are purchased and sold: Namely, a mutual agreement made before sale or purchase by the buyer and the seller, covering the amount and quality of goods, when, where, and how delivered, the price, and other matters incident thereto.

The agencies by and through which the agreement is effected are the organizations representing, respectively, the buyer and the seller.

Specifically stated and precisely as it is in operation under the recommendations of the National Association of Builders: "A joint committee, composed of an equal number of delegates from the association of employers and from the association of workmen in any craft or calling, to which joint committee is referred all matters of mutual concern, the decision of the said joint committee to be final and binding upon all members of either and both associations. If the joint committee be equally divided on any question, then an umpire, who is chosen as the first item of business at each annual meeting of the joint committee, and consequently before any differences of opinion have been reached, is called in, and then his decision is final and binding on all parties. This umpire must be from some calling outside that of the craft concerned, preferably a judge of some of the higher courts or in such commanding position in the community as to place him above suspicion. No strikes or lockouts to occur under any condition, but work to proceed undisturbed.

*

ARBITRATION.1

President ARTHUR T. HADLEY, Yale University.

President Hadley thinks that the demand for State arbitration, and especially for compulsory arbitration, comes chiefly from the workingmen. After pointing out the superior position of the employer in a strike, he continues:

"If, however, the employer can be prevented from protracting the dispute, the position of the strikers is different. They have only to hold together for a short time in order to be assured of suc cess. They are placed on the kind of vantage ground enjoyed by the man who makes a corner in wheat when a large number of people have contracts which they must fulfill within a limited period. This is the most potent motive with those who demand compulsory arbitration.

"They support this demand with strong arguments. They urge that the capitalist who builds & railroad must undertake to serve the public continuously. The more complete the monopoly, the greater is the public necessity for uninterrupted service. This public need is paramount to all other considerations. The capitalist should not be allowed to withhold the necessary service from the public, merely because he can not agree with his workmen as to the terms of payment.

"To this argument there is an equally strong reply. If capital is to be compelled to maintain continuous service on terms like these, it will be difficult to find investors who are ready to put their money into business enterprises which are subject to this liability. Such an arrangement as the one proposed, while apparently fair to both laborers and capitalists, is really quite one-sided. It could be enforced against the employer, but not against the employee. Laborers can not be compelled to work on the basis of an arbitrator's award. They have not, as a rule, property enough to be held to such an agreement by the threat of pecuniary damages. No one would put them in prison if they refused to accept the rates offered. Even if they could be thus compelled to work against their own will, the service rendered under such terms would resemble slave labor, and might become dangerous alike to the property of the employer and to the safety of the public.

"If capitalists are afraid to invest their money in new enterprises, both laborers and consumers suffer; the consumer for lack of new sources of supply, the laborer for lack of new fields of employment. The loss to the laborer from this cause more than neutralizes any good which he may have obtained from the temporary enforcement of his demands by a board of arbitrators. This is illustrated by the history of the years 1885 and 1886, when the industries of the United States were virtually under a régime of compulsory arbitration [during the time of the Knights of Labor].

"It may be objected that the system of arbitration as administered by the Knights of Labor was a one-sided one, and that no conclusion can properly be drawn from such an instance as to the effect of equitable arbitration under public authority. But reasons have been already given to show that arbitration under public authority is likely to be one-sided. It is sought by the laborers and not by the capitalists. It deals with conditions which are as yet unknown and can not be predicted with assurance by any board of arbitrators. If the decision of such a board is unfavorable to the workmen, they have it in their power to nullify it. If it is unfavorable to the capitalist, he must nevertheless accept it.

"We are placed in an awkward dilemma. If we do not admit the principle of compulsory arbitration we are liable to interruptions of public service at points where its continuous maintenance is essential to the comfort and prosperity of the community. If, on the other hand, we adopt compul sory arbitration as a principle, we are liable to an interruption of the investment of capital where it is essential to social and industrial progress. The public is the sufferer in any event.

"Fortunately, the practical chance of escape from our dilemma is rather better than the theoretical one. Every strike teaches either workmen or capitalists some useful lessons for the future. * * So far as the managers on either side become in the true sense leaders of men, there is a chance for reducing labor disputes to a minimum. This may be a slow and unsatisfactory remedy for present troubles; but it is the only one which appears to promise much hope of permanent success. "Government agencies for arbitration can be arranged either to help or hinder this consummation. * * * The history of boards of arbitration, both in Europe and America, shows how little can be accomplished by the exercise of political authority after a fight has once begun. *** A very considerable proportion of the disputes between labor and capital may be characterized as wholly unnecessary. They are the outcome not of direct quarrels, but of misunderstandings. The employer wants to do one thing, the laborers think he wants something else; they object to the latter, and he believes that they are taking exception to the former. Or it may happen that the men protest against a reduction in wages without knowing what the conditions of trade really warrant; the employer insists on the reduction without giving facts to sustain his position; the workmen strike in the belief that he is willfully refusing to give the wages they demand, when the truth is that he is prevented by sheer inability. After the strike is once inaugurated it is often too late for further explanations. But a board of conciliation, whether organized by the Government or by the voluntary action of employers and employed, can render the greatest service in enabling each side to get a clear understanding of the other's position before matters have gone so far as to render cool action on the basis of such an understanding impossible.

"If, before any dispute arises, both parties can settle upon a satisfactory scheme for the determination of wages and make a long-time contract on this basis, it precludes much of the danger of labor troubles. The system which has seemed best adapted to this end is known as the sliding scale. "Where the conditions will admit of its use, it has a decided influence in preventing labor troubles, by settling in advance the share in which the laborer and capitalist shall divide the advantages of a rising market or the burdens of a falling one; nor is it, under favorable conditions, so complicated as to give rise to misunderstanding and suspicion.

From the employer's standpoint no exception can be taken to the principle of the sliding scale. It undertakes to do for noncompetitive labor what economic forces do for competitive labor-to give the workman the total value of what he makes, less a deduction for the necessary profits of capital. But from the workman's standpoint there is always a possible objection which may prove very serious. What if the price of the product, less the necessary deductions, fails to give him the income he needs in order to keep himself and his family alive? Looking at the matter from this side he proposes another standard as a basis of just remuneration-the standard of the living wage. According to this view, labor should be paid enough to maintain it at a good grade of efficiency, the amount necessary for this purpose being determined by the habits of life of the workers themselves."

1 Hadley, Economics, pp. 356-362.

INDUSTRIAL AGREEMENTS AND TRADE ARBITRATION.

Opinion of NEW YORK BOARD OF MEDIATION AND ARBITRATION, 1

The experience of the board leads us to the conviction that two of the most common causes of strikes are: Unwillingness on the part of employers to recognize trades unions, and a lack of cordiality on the part of employers toward their employees. It may be stated, as a general proposition, that employers in this State are, as a rule, opposed to the organization of their employees into trades unions, and only tolerate their existence because they are powerless to prevent them. It is not likely that the employers generally would admit the truth of this statement. In most instances employers will state that they have no objection to the organization of their employees into unions, and that they have no desire or purpose to interfere for or against them. But their refusal to treat with or recognize union committees, and their disposition to resent any so-called interference with their right to conduct their business as they please, so far as it relates to questions of wages or labor conditions, is a practical repudiation of the principles of unionism and a most prolific cause of labor troubles. Workingmen have long since learned that when employers refuse to deal with them save as individuals there is really only one side to the case. They believe that a union of individual interests is necessary, unless they are to remain at a decided disadvantage in their demands for what they consider their rights.

This general disinclination to recognize trades unions in a practical way has its origin in part in a common lack of cordiality on the part of the employers toward their employees. Both sides are apt to act from selfish motives, and it is, perhaps, not strange that in the struggle the employer desires to have full control over labor conditions, and is not often willing to admit any close relation which would make these conditions a question for debate. A closer relation would lead to a wider knowledge of the facts as to whether labor was receiving its fair share of the product of labor, and for this reason there is hesitation on the part of employers to put themselves in a position where greater publicity, or a seeming surrender of legal rights, would be recognized. In view of this attitude on the part of employers, and of the great increase in the acquisitions to the ranks of trades unions, there is a growing need of a fair consideration of the best means for avoiding industrial disputes, or for their settlement by peaceful means. It must be manifest that any method which is to be received with favor by the great body of employees must be based upon the right of workingmen to organize and their right to know the true condition of the trades which may be involved. To be successful both sides must meet on a common basis at short range, imbued with a desire for fairness and candor, and a determination to reach fair conclusions. There must be discussions, which will give opportunity for giving and taking arguments, for learning each other's point of view, and for being influenced by reasonable conditions. It is the opinion of the board that these conditions can best be met through the medium of industrial agreements between employers and employees, by which all disputes shall be referred to boards of conciliation and arbitration made up in part of employers and in part of employees. This method of settling labor disputes has been pursued with great success in England, where its use has led to a desire, on the part of employers, for the organization of their employees, because of the greater facility afforded for an open exchange of views to a settlement of hundreds of disputes without recourse to strikes or lockouts, and to industrial peace, which has been of inestimable value to manufacturers and to hundreds of thousands of workingmen. Whether this method of settling industrial disputes shall become general in this country must lie with the employers of labor. It is for them to decide whether, in the face of changed and changing industrial conditions, they are willing to open the way for free discussion and intercourse, even though it involves a surrender on their part of what they deem their rights.

ADVANTAGES AND DIFFICULTIES OF ARBITRATION.

Extract from Report of Mr. JOSEPH D. WEEKS to Governor of Pennsylvania, 1878.

There are two, possibly three, objects sought in the formation of boards of arbitration and conciliation. The first is to prevent differences between employed and employers from becoming disputes, and leading to strikes and lockouts; and the second is to settle disputes that have unfortunately arisen, and to put an end to sirikes and lockouts, should they occur. The third, object which is possibly included under the first mentioned, is to promote mutual confidence and respect between these two classes. The only sufficient reason for the adoption of the principle is that it accomplishes these purposes.

Whether it has accomplished these objects in the trades in which it has been fairly tried in England can be judged by the facts set forth in the preceding pages of this report. For myself, I do not hesitate to say that it is not only the best method yet devised, but the only rational one for adjusting the relative rights of employers and employed under the present constitution of industrial society. In making this statement, I do not forget the method by strikes and lockouts, nor do I consider it. These methods are neither rational nor civilized, A victory or defeat for either side, under the pressure of strikes or lockouts, neither proves or disproves the justice of a position assumed; but it is fair to infer that an award given by a board of arbitration, after due consideration, would be as near just and right as it is possible for human judgment to reach. It is to be observed, also, that a decision of a board should not be, and in most cases is not, regarded as a victory by one side or a defeat by the other. There is no exultation over victory, no smart over defeat, nor a determination to wait for a convenient season and revenge. The burning questions that arise are settled in a friendly manner. Another advantage of a permanent board of arbitration, with stated meetings, is that it furnishes an opportunity, seldom possessed without these, for the workmen to obtain a knowledge of the needs of trade and the demands of the future both upon them and the manufacturers. Labor troubles are as often the result of a lack of information as to the true state of a trade as of any other one thing. It is true that workmen may be told the facts rendering a reduction necessary; but they are not inclined to credit them, and believe that affairs are not as represented. In the working of the English boards, especially in fixing prices, notice is taken of the state of trade and competition with other countries and other districts, and the information thus gathered, not by the employer members, but by the board, is brought to bear in the settlement of wages. * * *

This suggests another and a most important advantage of these boards. Accepting the fact that unions of workmen exist, and will doubtless continue to exist, it is only through boards of arbitration or conciliation of some kind that the trades unions and those employers can meet except as

1 Report of New York Board of Mediation and Arbitration, 1900, p. 52.