Revolution at Labor.
A THUMB in the eye to the minimumwage lobby is how most journalists depict the nomination by Presidentelect Donald Trump of Andrew Puzder to the post of labor secretary.
But offering up a fast-food entrepreneur for the labor post does more than offend a particular interest group. The Puzder nomination represents a structural blow to the whole edifice that we have called “labor relations” since the Department of Labor was created more than 100 years ago.
First, consider Andrew Puzder. As the head of CKE Restaurants, a company that directly or through franchises employs 75,000 workers, Puzder has more involvement with labor regulations every day than many executives do in a lifetime. He’s worked with nonunionized labor, not the union establishment.
Next, consider Puzder’s two- dozen-odd predecessors. The progressives who established the Department of Labor, Democratic or Republican, believed that government ought to support the unions and that wage increases were always beneficial. These same progressives also took a top-down approach, reckoning that just a few establishment parties—big Labor, Big Business, the government and maybe an academic or two—could and should determine whether unemployment was 3%, 5% or 10%. Nonunion workers, small-business employers, company owners and innovators—none of these were in the room.
The first labor secretary, William Bauchop Wilson, set the pattern. Wilson had served as secretary-treasurer of the United Mine Workers and then as a congressman representing the 15th district in Pennsylvania. Wilson applied his thumb not to someone’s eye but to the scales of government, tipping them toward organized labor and pushing hard to help coal strikers in Colorado and Michigan. James “Puddler Jim” Davis, Wilson’s successor, came out of the steel mills and also had a political bent, successfully running for the U.S. Senate after his service. (Davis became cosponsor of the Davis-bacon Act, known for forcing wage hikes on small employer-contractors.)
Franklin Roosevelt tapped Frances Perkins. She hadn’t led unions, but Perkins had experience in both academia and government. The New Deal’s labor secretary helped to elevate the Department of Labor from office to edifice. It was during the Perkins era that the Wagner Act, wildly pro-union, became law and the National Labor Relations Board, an independent agency and court system for labor, was created. The New Deal also established the national minimum wage, the very device that Puzder challenges.
Perkins didn’t merely side with union members—she led them. Dur- ing strikes at the Homestead Steel Works in Pittsburgh, the labor secretary marched with workers to assemble at a government site, a U.S. post office, so that she might remind them of the merits of collective bargaining.
The change that voters may have expected didn’t come when Republican Dwight Eisenhower took office. Ike, a conciliator by nature, selected a Democrat and former director of labor for the state of Illinois, Martin Durkin, to lead the department. Even George Shultz, a free-marketer, had more experience in academia than in business when he took office.
persecution of Donovan
Among all of the labor secretaries to date, one stands out: Raymond Donovan, whose main credential was running the business side of Schiavone Construction in New Jersey. Ronald Reagan’s selection of Donovan so irritated prolabor Democrats that even before his confirmation they sought to prove he was some kind of Tony Soprano, operating corruptly. Once Donovan was confirmed, the Democrats kept assailing him. It was Donovan, who, after a Bronx jury had acquitted him of both fraud and grand larceny, posed the poignant question: “Which office do I go to to get my reputation back?” Succeeding labor secretaries have sometimes fought harder for the private sector—the Bush Administration’s Elaine Chao comes to mind.
It takes chutzpah to select for a cabinet post someone from the fast-food industry. Left-leaning periodicals vilify this fast-food executive for sport. But maybe chutzpah is necessary. The fact is that Democrats have long counted on Republican presidential winners’ being too timid to appoint a labor secretary who might challenge Big Labor.
If confirmed, Puzder is likely to do something that demonstrates that the economy expands better without government, powered by those shadowy figures who don’t usually win places at the top table. He’s likely, too, to remind us that a union-tilted Labor Department doesn’t necessarily serve the country best.