Rocky Mountain Radicals: Labor’s Rich & Powerful Allies

MHS ArticleNew in the Spring edition of Montana: The Magazine of Western History

The labor movement in the Gilded Age and New Deal era found an unlikely pair of allies in a wealthy miner and his nephew.

James A. Murray started his business empire with a few dollars in his pocket in 1863 prospecting in Rocky Mountain mining camps along Mullan Road. Over the next fifty-eight years he built a fortune that today would exceed $2.0 billion and stretched from Seattle to San Diego, and from San Francisco to Wyoming. Murray was a staunch advocate for labor and never stopped supporting their cause as anti-union corporations enveloped the American West. He funded a radical pro-labor newspaper affiliated with the Wobblies during the height of labor strife in World War I, and extended his radical legacy with a significant bequest to his equally radical nephew, future U.S. Senator James E. Murray.  The younger Murray rose to the top of Eamon de Valera’s support group in the U.S. and became the Senate’s strongest proponent of labor and progressive politics from  the New Deal Era until the dawn of the Civil Rights movement.

The story of the radical Murray family is told in depth for the first time in a beautifully illustrated twenty-page article in the Spring 2016 Edition of Montana: The Magazine of Western History. Copies of the Spring edition can be purchased individually from the Montana Historical Society.  The publication is also available in over 700 libraries across the globe. Find a copy near you on the World Catalog.

Coming next year: The biography of radical Copper King James A. Murray will be published by Montana Press Publishing Company in the Fall of 2017.

Tax History 101 for CBS Debate Moderators

Nancy Cordes, CBS Congressional correspondent, and a moderator at this cordesweekend’s Democratic Presidential debate, was shocked and amused at Bernie Sander’s response to her question about the top rate in his tax plan. Sanders’ remarked that it would not be as high as President Eisenhower’s ninety percent (90%) top rate – adding a humorous note that he was not as big of a socialist as was Ike.  Cordes’ amusement revealed that she either knew little about the history of tax policy in this country, or she is personally opposed to raising tax rates – neither being a good quality for a moderator.

The history of tax policy in this country is critical to understanding many of the issues that are highlighted in presidential debates. Income inequality, the cost of higher education, and the lack of funding for veteran’s programs are all tied to dramatic, and relatively recent reductions in tax rates applied to the wealthiest Americans.

The History of Income Tax Rates in America

Federal Income tax was reinstated in this country in 1913 after a nineteen-year hiatus, and by 1917 the top marginal tax rate jumped to 67% on income above $2.0 million per year (the equivalent of $35 million in 2013). The top rate dropped significantly leading up to the Great Depression, before rising again to fund F.D.R.’s New Deal.

Figure 1 below provides the tax rate applied to the highest income bracket (in blue)and the tax rate applied to households with annual incomes of $500,000 (adjusted each year to 2013 dollars and illustrated in red). Note that the differential in tax rates on the wealthiest Americans (making over $500,000) were reduced starting in the Kennedy administration and eliminated completely by the end of Reagan’s first term.

Figure 1

The chart illustrates several important points:

  • Bernie Sanders and others speaking to a higher tax rate for the 1% have history on their side (sorry Nancy, but you should have done your homework on this).
  • Brokaw’s “Greatest Generation” was served by federal programs funded through tax rates that placed a greater burden on the wealthiest Americans.
  • Medicare, aimed at serving the aging members of the Greatest Generation, was adopted at a time when tax rates focused on the wealthiest Americans.
  • Recent decreases in tax rates and elimination of free tuition (1) followed the adoption of the Civil Rights Act, denying minorities the educational opportunities afforded to the Greatest Generation and Baby Boomers.
  • Practically every presidential candidate, and debate moderator, lived during a time when tuition was free at public universities (or just a fraction of what it is today).

Figure 2 below compares the top tax rate and the top income bracket since 1913. The top income brackets are adjusted to 2013 dollars and displayed on a logarithmic scale.

Figure 2

Going forward, perhaps the questions for presidential candidates should be:

  1. “Why shouldn’t Millennials benefit from educational opportunities afforded to the Greatest Generation and Baby Boomers?
  2. Why should free college tuition, withheld from minorities prior to the Civil Rights Act, be denied to minorities after passage of the Act?
  3. Why aren’t the tax rates and tax brackets that served the Greatest Generation and the Baby Boomers not being used for the benefit of Millennials?

(1) The University of California system is used to illustrate the end of free tuition in public universities.

Note: Historical tax rates can be found at the Tax Foundation.

Book Review: When Mandates Work: Raising Labor Standards at the Local Level

when_mandates_workWhen Mandates Work [1] is a good resource guide for use in cities and airports located in primary urban markets. Most of the research centers on San Francisco, which likely applies to cities like Seattle, Portland and San Diego and their airports. The content of the book is drawn from individual journal articles written by several different authors, so the content varies dramatically from chapter to chapter.

Part one of the book looks at living wage ordinances in cities and airports. Significant benefits are found in terms of reduced turnover rates and improved employee morale. For restaurants in one study, price increases  of 2.8 percent occurred, which is remarkably similar to estimates on anticipated cost increases derived using MIT’s living wage models.[2] As an aside, I am confounded that there is not bi-partisan support for living wages at fast food restaurants across the country. Why any fiscal conservative would not want the fast food industry to stand on its own, and stop using federal subsidies to bolster worker’s living standards, is incomprehensible.[3] Every fiscal hawk should be wagging their finger at Ronald McDonald to get off the public dole!

Part 2 covers health care benefits and Part 3 provides execution strategies – including the use of Community Benefit Agreements (CBAs).

Anyone looking at CBA’s for their city should take a close look at the CBA negotiated with Twitter in San Francisco. The hearings on this document are readily available on-line in City archives. Twitter clobbered the City in negotiations. Adding insult to injury, the primary beneficiary of Twitter’s move to the City’s central business district (building owners) did not participate at all in the CBA.

If you are on a budget, review the table of contents and search for the individual journal articles that comprise this book which are relevant to your situation, and download those individually (most libraries provide patrons with access to JSTOR – the primary database for academic journal articles).


[1] Michael Reich, Ken Jacobs, and Miranda Dietz, eds., When Mandates Work: Raising Labor Standards at the Local Level (University of California Press, 2014).

[2] http://livingwage.mit.edu/

[3] McDonald’s has in the past directed employees to federal assistance programs through their employee hotline.

Historical Amnesia: The Humphrey-Hawkins Act, Full Employment and Employment as a Right (Ginsburg, 2011)

President Jimmy Carter signs Humphrey-Hawkins.

From the article abstract:

Economist William A. Darity has proposed a federal job guarantee with decent wages for all job seekers, an idea with deep, but largely forgotten, roots in US history. The article briefly explores some New Deal job-creation efforts and President Franklin Roosevelt’s proposal for an Economic Bill of Rights. It then focuses on two major attempts to secure full employment through legislation. The Full Employment Bill of 1945 was defeated; the compromise, the Employment Act of 1946 did not have full employment as its goal. After years of struggle, a much-weakened Humphrey-Hawkins Full Employment and Balanced Growth Act of 1978 passed, but then was violated and virtually ignored. Full employment shifts power from capital to labor, so major opposition can be expected from efforts to obtain it. Proponents need more power and a strong movement, including at the grassroots level, pushing for jobs for all–not just jobs for me or my group. Publicizing the benefits of past job programs and reintroducing the idea of a decent-paying job as a right are suggested, as well as making decent jobs for all the center of economic policy. This requires a fundamental break with neoliberalism and reallocating political power away from big business and Wall Street toward middle and working-class people and the working- and non-working poor.

Link to full article: http://www.njfac.org/bpe-ginsburg.pdf

The Missed Opportunity for an Economic Budget

JamesEMurrayFullEmployment“There is something wrong with the distribution of income in our economy. Not enough of the income created by production gets into the hands of those that will spend it back into production.

Senator James E. Murray, 1945 [1]

The end of World War II placed employment at the top of the national agenda. Seasoned lawmakers and experienced public officials had lived through the burst of an employment bubble after WWI, twenty-five years early, and the Great Depression that followed.

President Roosevelt, during his annual message to Congress, proposed a “Second Bill of Rights” to guide Congress in establishing “a standard of living, higher than ever know before.”

The rights included:

  • The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;
  • The right to earn enough to provide adequate food and clothing and recreation;
  • The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;
  • The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;
  • The right of every family to a decent home;
  • The right to adequate medical care and the opportunity to achieve and enjoy good health;
  • The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment;
  • The right to a good education.[2]

Senators Harry Truman (D-MO) and Senator James E. Murray (D-MT) presided over a Senate subcommittee focused on the first point, to provide employment opportunities for all Americans. When Truman left the Senate for the Vice Presidency, the responsibility for shaping legislation fell to Murray. In 1945, Murray, Chairman of the Senate Committee on Education and Labor, drafted Senate Bill 380, the “Full Employment Act of 1945” and found bi-partisan co-sponsors in Senators Wagner (D-NY), Thomas (D-UT), O’Mahoney (D-WY), Morse (R-OR), Tobey (R-NH), Aiken (R-VT), and Langer (R-ND).

S. 380 sought to go beyond the reactionary work-relief measures crafted after the Great Depression, by taking advance measures to avoid depression and unemployment altogether. A critical element of this proactive approach was for the President to prepare a separate “National Production and Employment Budget” (Economic Budget), apart from the regular budget, that prescribes a “complete and well-rounded program for maintaining full production.” Murray believed that the Economic Budget would focus lawmakers on substantive employment policy matters every year, as opposed to merely limiting the discussion to meaningless campaign rhetoric every presidential election. [3]

During the subsequent debates of S. 380, the bill was watered-down, the Economic Budget was dropped, as was “Full” from the title. The Employment Act of 1946, adopted and signed into law, created policy objectives similar to those outlined in F.D.R.’s Second Bill of Rights, but it fell short in focusing Congressional attention on the economy and unemployment.

An annual Economic Budget is a concept worth revisiting. It could pull the nation’s most important issue off the campaign trail and put it back into halls of Congress where it belongs. It would serve as a central point to discuss living wages, work-visas, public service employment and corporate out-sourcing.

[1] James E. Murray, “A Practical Approach,” The American Political Science Review 39, no. 6 (December 1945): 1119–26.

[2] http://www.ushistory.org/documents/economic_bill_of_rights.htm

[3] Murray, “A Practical Approach.”