By John Kretzschmar
The writer is director of the William Brennan Institute for Labor Studies at the University of Nebraska at Omaha.
Labor Day is our only national holiday dedicated to those who sell their intelligence, experience and strength to earn a living. The national holiday was created in 1894 during the Gilded Age, following the Civil War. Twelve-hour days and seven-day work weeks were common. Child labor was also commonplace. The 1910 Census revealed that 1.7 million children between ages 5 and 10 were “gainfully employed.” It was a time characterized as having “robber barons,” “huddled masses” and not much in between. It was a period of hyper-partisanship and strong anti-immigrant emotions.
During the Gilded Age, the economy rapidly grew and GDP soared. The challenge to the nation’s founding ideals was that most of the wealth created was accumulated by the elite few, while the many toiled in poverty. Briefly stated, there were policies in place that put “too much wealth in too few hands.” It was an example of the challenge that President Abraham Lincoln noted when he observed: "There has never been but one question in all of civilization -- how to keep the few men from saying to the many men, `You work and earn bread and we will eat it.'"
Jay Gould, a robber baron of the era, bragged in 1886 that he was unconcerned about a pending strike by union laborers on one of the many railroads he ran. When asked about his fears of a strike, Gould remarked he had none, because he could “hire one half of the working class to kill the other half.”
That callous indifference to his employees’ well-being was symptomatic of the Gilded Age. It gave rise to the growth of labor unions. The American Federation of Labor was formed in 1886. It was the same year as a national push to create the eight-hour work day.
The popular reaction against the growing influence of big business in public policy was everywhere. By 1890, Congress had passed the Sherman Anti-Trust Act. In 1892, the Populist Party held its founding convention on July 4 in Omaha. And in 1894, after 23 states had celebrated their own Labor Days, President Grover Cleveland signed a bill creating a national holiday dedicated to the contributions of everyday wage earners.
The importance of celebrating the contributions of wage earners in creating better lives for their families and communities was a natural reaction to the economic inequities that were essential to the Gilded Age.
The labor movement is about leveling playing fields and removing barriers to the American Dream. Unions were created to help everyday employees gain a meaningful voice in jointly determining their future quality of life. To accomplish that, employees formed labor unions and collectively bargained with employers to create legally binding contracts covering wages, hours and terms of employment.
Challenging the political economy of the Gilded Age proved difficult. In the leadup to the 1896 presidential election, William McKinley’s campaign manager famously noted, “There are two things that are important in politics. The first is money, and I can't remember what the second one is.” Corporate money was going to McKinley’s campaign, while his challenger, Nebraskan William Jennings Bryan, was bereft of the same level of support from big business.
Fast forward to 2019. The economy is growing and unemployment is low, just as in the Gilded Age. But just as President Lincoln noted, income inequality is an issue that needs solving. Judging by history, the only time when real income, adjusted for inflation, doubled for the entire workforce was in the period following World War II. Union density peaked in the U.S. Some refer to this period as the “Good Old Days.”
Organized labor remains a public good. It benefits both wage earners and businesses. We know that the best friend of Main Street merchants is a well-paid workforce. Please keep that in mind as you celebrate Labor Day.