How to Damage the Economy

Lyndon Johnson does not often get publicly angry at labor, but he was coldly furious last week. Object of his wrath: the striking longshoremen, who had rebuffed two presidential pleas to return to work, were in the fifth week of a senseless strike that halted the nation's waterborne commerce from Maine to Texas. Not only was continuation of the strike "totally unjustified," said the President, but "the injury to the economy has reached staggering proportions."

The senselessness of the strike lay in the fact that most of the locals of the International Longshoremen's Association, beginning with the pace-setting New York local, had accepted new four-year contracts in recent weeks. But negotiations dragged on in Galveston and Miami--and I.L.A. President Thomas W. Gleason kept all his men off the job while waiting for unions everywhere to settle.

To break the impasse, the President named Labor Secretary Willard Wirtz, Commerce Secretary John T. Connor and Oregon Senator Wayne Morse as members of a panel to recommend settlement terms within 42 hours. With that, things began to happen. The National Labor Relations Board, which normally takes weeks to ponder such moves, got federal courts in New York and Baltimore to order the strikers back to work. The union at first ignored the injunctions, but at week's end "Teddy" Gleason, perhaps noting the congressional clamor for a law to forbid another such walkout, ordered his men back to their jobs everywhere except in Texas and South Atlantic ports.

Meanwhile, at the request of the new presidential panel, the Air Force flew planeloads of the union-management negotiators from Texas and Florida to Washington. The panel sat up until just before dawn to hear their views, then gave both sides one hour to take or leave its proposals: a return to work, followed by mediation and arbitration for the West Gulf; 16-man minimum gangs and two hours' pay when weather prevents work for the South Atlantic. The President endorsed the terms and the employers accepted them, but the union turned them down. Negotiations will resume this week.

Shortage of Scotch. With more losses to come, the strike has already dealt the U.S. economy a $2.2 billion blow--$67 million for each day of the strike. Commerce Secretary Connor estimated that 191,000 workers were idled by the strike: not only the 60,000 striking longshoremen, but 38,000 seamen and other maritime workers, 45,000 railroadmen, 48,000 truckers. With 855 ships tied up, U.S. ocean shippers were deprived of 161 million tons of freight. The nation's strangled lines of trade also cost highway carriers 9,000,000 tons of business, railways 7,000,000 tons, and inland waterways 500,000. With exports off by $60 million a day and imports off by $40 million, every day of the strike wiped out $20 million of the U.S. foreign-trade surplus.

As is usual in dock strikes, the biggest losses at home were caused by interruption of commodity shipments. Sugar refineries in New York, Philadelphia and Baltimore laid off 1,700 employees after they ran out of raw sugar. Pepsi-Cola closed its Long Island City bottling plant. Grain exporters estimated that they lost $250 million of January shipments. Cargill Inc., the nation's largest grain exporter, closed elevators in four states, and two soybean plants shut down in Decatur, Ill.

With 23,500 railroad cars immobilized as they awaited unloading in harbors and another 25,000 backed up by an embargo at inland points, car shortages showed up as far inland as Wisconsin. B. Kuppenheimer & Co., a Chicago suitmaker, laid off 200 cutters and trimmed its production 35% for lack of imported fabrics. Textile and shipping employees in Houston and Boston had to go on unwelcome winter vacations. In Miami, a shortage of Scotch threatened vacationers while 200,000 cases lay in six ships in the port.

Coffee Loss. The strike's impact was also felt abroad. Puerto Rico suffered a $150 million trade loss, and Colombia and Brazil lost coffee exports. Reduced shipments of food to India complicated that country's battle with starvation. Volkswagen dealers began to run out of stock in Chicago, Philadelphia and Atlanta, and Volvo's sales to dealers fell 44% in January.

Effects of the strike will linger for weeks. When the I.L.A. struck for 34 days two years ago, it took a month to clear up the log jam of freight in New York. This time, said port officials, the pile-up is so much bigger--dozens of ships, unable to find berth space, have been anchored in the harbor--that eight weeks may be required to clear it away.

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