Director General, and that the increases when made would be retroactive to the beginning of federal control (January 1, 1918), together with an assurance that the Director General's "cabinet" would include as Director of Labor the chief executive officer of one of the railroad labor unions, cleared the atmosphere. While there was some dissatisfaction when the wage increases were announced in May, it was not serious, and further upward revision in the wages of the dissatisfied classes effectively checked the tendency to fight for the higher scales of compensation then applying to the war industries. On the whole, the attitude of labor in 1918 was one of loyalty to the Administration and of willingness to work faithfully so that the railroads could meet the stupendous war-time transportation demands.

Following the signing of the armistice on November 11, the situation quickly changed. The cool reception which was accorded to Mr. McAdoo's proposal that federal control should be extended five years, or to the close of 1923, indicated clearly that Congress, responding to insistent public opinion, would adopt legislation under which the railroads would be returned to private management as soon as the transfer could safely be made. In May, the President announced that the railroads would be returned to their owners by the end of 1919.

The employees had fared so well under federal control, and their leaders had found it so much easier to obtain concessions from the Director General than from the railroad managers under

former private control, that early in 1919 they adopted a policy of attempting to get as much more in further wage increases and favorable rules as was possible to obtain from the Administration while it continued in existence. Under such circumstances, Mr. Hines, who succeeded Mr. McAdoo as Director General on January 11, 1919, was confronted with a difficult task in holding these demands within reasonable bounds and in maintaining the morale of employees. He could not invoke the spur of patriotism, so effective in 1918. The war was over and it had been won. Profiteers and others had made and were making fortunes. Labor outside of railroad service was still receiving war-inflated wages. It was natural then that the railroad workers should exert every effort and should use the entire strength of their organizations to obtain the greatest possible advantage while conditions were favorable for the purpose."

*It is not without significance that the leaders of the railroad unions and a large body of the membership indorsed the movement for permanent nationalization following the war experience. This sudden shifting of position on the part of the leaders, most of whom had previously been opposed to the policy, can be interpreted as a shrewd estimate of what federal management meant to them. They had had their first taste in the Adamson Act. Upon this as a foundation they built up their powerful national organization of the war time, under the sympathetic observation of the first Director General and with the active assistance of his Director of Labor. It is no exaggeration to say that the gains made by railroad labor during the 26 months of federal operation in the power of collective bargaining, in the development of union organization, in the standardization and nationalization of practises and policies, were greater than in the entire previous period of their existence. That they desire to perpetuate these gains under private operation is no more than human.'' Railroads and Government, F. H. Dixon, p. 189.

Following the general wage advances and the general adoption of the basic eight-hour day in May, 1918, there was a cycle of additional increases. The shop crafts were the first to receive attention on July 25, 1918; then the clerical forces and maintenance of way employees on September 1; then the telegraphers and signalmen on November 16; and then the station agents on November 23. In 1919, the following additional supplements to General Order 27 were promulgated granting higher wage rates and favorable working rules for the classes of employee specified:

Supplement 14, January 25, employees of police department.

Supplement 15, April 10, enginemen and firemen. Supplement 16, April 14, conductors and trainmen. Supplement 17, April 14, Pullman conductors and porters.

Supplement 18, April 14, restaurant and dining car employees.

Supplement 19, April 14, express service employees.

With the issuance of the last of these supplements the Director General announced that the "war cycle" of wage increases had been completed and that any further increases would have to be considered in the light of new conditions."

*In the spring of 1919 retail prices for everything the laboring man had to buy were continuing to rise, and further increases were then predicted. The great question that then confronted me at that time was whether I would shape my policy as to encourage and apparently render inevitable a still further increase in the cost of living, or whether I would shape it so as not to be an influence in that direction. I felt that the country was involved in a vicious upward spiral at that time; that

The announcement, however, did not deter the formulation and presentation of new wage demands from practically all classes of employee. The shop crafts were more insistent than other classes and in August, 1919, forced the issue by a threat to strike when the demands were not granted. The situation became so serious that President Wilson found it necessary to intervene in support of the Director General and a nationwide strike was averted by a compromise offer which gave the men a fraction of the increases

every upward change that was made involved some other upward change, which always translated itself into a still higher cost of living. If railroad wages were increased it would mean similar increases in rents and in retail prices pretty shortly. And if they were increased, and if wages were increased again as a result thereof, it would mean another increase in retail prices. And under the conditions as they existed in the spring and summer of 1919, on a rising market of retail prices, practically any pretext was seized upon as a reason for an additional increase in prices. In view of that situation I reached the conclusion that if I could hold the level of railroad wages where it was I would render a very important public service, so I took the position that I would not favor a general increase in wages. But while in 1919 the condition was as I have described, and while I felt and saw with perfect clearness what my policy ought to be, it was quite clear that I could not ignore all complaints as to wage inequalities or working conditions. There were not only numerous extreme demands being pressed on behalf of various organizations and employees, but there was the most extreme agitation going on within the organizations, agitation of the most extreme kinds; the most extreme types of labor agitators were at work and were threatening to overthrow the more conservative and experienced leaders who in my opinion were endeavoring, in the interest, not only of the laboring man, but of the public, to help control a situation of very great difficulty. In that situation I felt that it was of the highest importance that I should consider with patience and justice any claims that were made for readjustments in wages and in working conditions while still insisting I did not feel a general increase ought to be made in the level of wages.'' (Testimony of Walker D. Hines, former Director General, before Senate Committee on Interstate Commerce, January 24, 1922).

demanded. The men at first refused to accept the Director General's decision, but after the President had taken a hand in the affair, and the whole subject was given much publicity, the leaders prevailed upon the militant minority of the union membership to make the best of the award. With the moderate increase in wages, was coupled an assurance of a national agreement which meant as much, if not more, to the organization than wage rates. This agreement will be referred to in detail in another part of this chapter.

While these negotiations were in progress the executive officers of the shop crafts had much difficulty in restraining a substantial part of their members. Within their ranks were many who were radical in view and some of them aspired to overthrow and supersede the leaders then in office. As a result there were many unauthorized strikes of shopmen throughout the country, all of which were without sanction of their executive officers. These officers did all that they could do to restrain the men and induce them to return to their jobs and await the outcome of orderly negotiations, and the Director General notified the strikers that their demands as a whole would not be considered until all of the strikes were terminated. While a few of the strikes were serious in their effects, most of them were sporadic and brief.

These unauthorized strikes, however, were not wholly on account of wages. Out of the 33 strikes among railroad and express service employees but 10 related specifically to wage rates. The ma