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From Socialist Appeal, Vol. III No. 50, 14 July 1939, p. 4.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).
The new law which abolishes the prevailing wage on W.P.A. construction projects by decreeing that all W.P.A. employees must work a full 130 hours monthly for the subsistence relief wage is part of a long-term, deliberate plan to smash the wage levels in the construction industries. Like any other similar plan, directed toward a particular industry, this means the attempt to decrease the share of the workers in the total national income, and to increase the relative share drawn by the bosses.
This plan has, also, a political as well as an economic aim. Its author, once more, is none other than Franklin D. Roosevelt. Roosevelt has been preparing for the present smashing blow by several years of skillful publicity and build-up. He and his aides have been regularly making speeches, the latest of his own only a few weeks back, on the problem of what is wrong with housing. Beneath layers of rhetoric, the answer always seems to be: wages are too high.
Right now, the Monopoly Committee is conducting hearings on the housing and construction industry. Time and again the experts and witnesses come back to the theme: wages are too high.
The real political purpose is clear. The New Deal’s housing program, to which has been devoted huge mountains of ballyhoo, is an utter flop. Roosevelt needs a scapegoat, and he is trying to find one in the construction workers.
The government itself recognizes that at least one-third of the nation lives in sub-normal housing, unfit from the points of view both of hygiene and comfort. Nevertheless, nothing is done about it. The scattered and advertised projects of the Roosevelt administration are not enough to make up for the additional housing that each year falls below the level of decency.
Is there any truth that high hourly wages are actually to blame?
It is true that hourly wages – though not at all annual wages – are comparatively high in the building trades, and this naturally enters into the cost of housing. But consider:
The cost of financing a $5,000 house or $5,000 unit of an apartment dwelling, figuring in primarily interest and the other secondary bank charges, runs anywhere from about $3,000 to $7,500. The financing charges, that is, reach up to one and a half or more times the initial cost of the house itself! And for this enormous sum, the banks, with their monopoly of credit, do absolutely nothing in terms of socially productive work. All of this money is directly or indirectly sweated out of the labor that goes into building the house and that of the person who inhabits it.
Labor receives in wages a mere 20% to 40% of the initial cost. Who, then, deserves to receive major blame in this comparison?
But the financing charges are only a small part of the story. The profits of the great building materials corporations (U. S. Gypsum, Johns-Manville, American Radiator, etc.) have continued in the millions virtually all through the crisis. Inflated land prices line the pockets of real estate operators and speculators. In every building operation, contractors and sub-contractors take their big slice of profits. An ever greater percentage of real estate taxes, reflected in the cost of housing and rent, go to interest payment on bonds held by the big banks and the Sixty Families and to other uses of no conceivable benefit to the people.
In a true analysis, made in the light of social functions performed, labor, which gets no profit and asks no interest, is the least burdensome item in the costs of housing.
The truth is that not labor but a decadent capitalism stands irremediably blocking the road to an adequate, or even one-tenth adequate, housing program. Among all the fakes of the dead New Deal, none has been more hopeless or more hypocritical than its housing plans.
The new regulation, which went into effect July 1st, amounts in effect to a cut of from one-third to two-thirds in the hourly wage rate. As I write this column, the workers concerned are replying to Roosevelt’s move in their own proper language: a militant and rapidly spreading strike. All the machinery of Roosevelt’s relief administration is being brought into line to smash the strike.
Roosevelt, however, counts on a special factor to aid him. The hourly rates for these skilled workers have been in the past far higher than those for the other W.P.A. workers. Roosevelt thinks that he can exploit this as an apparent “injustice,” and drive a wedge between the two sections of W.P.A. workers.
There is an injustice, it is true. But the injustice lies not in the fact that the construction workers have a high rate – it is after all low enough – but in the miserable, starvation rate at which the bulk of the W.P.A. workers are paid. This has been, unfortunately, too often forgotten by the construction workers who have been too narrowly concerned with their own craft interests. A lasting victory in the present battle needs the fused strength of all of the relief workers. And this requires broadening the fight to include the burning demands for the lifting of the wage rate of the lower W.P.A. brackets.
If the construction workers inscribe on their own banner the demand for Thirty-Thirty – $30 minimum weekly wage, 30-hours maximum weekly hours – for all workers, they will find allies in the millions to back them in their own defense pf the living standards of the American working class.
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