Monday, August 24, 2009

Beyond the f-word: The Odenheimer Plan

by the Sandwichman

Below is the proposal made in November 1932 by Sigmund Odenheimer, a New Orleans cotton manufacturer and written up by Thomas Dabney in a book titled Revolution or Jobs?. Back in the Great Depression, even capitalists proposed radical solutions to unemployment!
We are confronted with a great emergency. It is said that the unemployed in this country equal in numbers the unemployed in all European countries. Nothing appears to be in sight to alleviate this condition. From a humanitarian standpoint, it is the most severe shock we have yet experienced. Viewing it in the light of safety to our institutions, and of the permanence of our present civilization, it is a menace of incalculable proportions. From what I can learn, the problem is growing worse.

There is only one remedy, and I propose that remedy.

It is, Jobs for every one, every week in the year.

We will need legislation to open these jobs; we will need an amendment to the Constitution.

That amendment would give Congress the power to legislate on hours of labor.

Only our government can meet our need in this critical time.

This amendment passed, Congress would create an 'Hours of Labor Commission.' The members would be appointed by the President, and would be responsible to him. The law would make it mandatory that one week after the Commission was appointed, it would issue a proclamation that the hours of labor in all industries, work shops, stores, etc., employing a minimum number of persons—say five—should not exceed a certain total a week.

Penalty for violating this law would be fine AND imprisonment for the employer.

The work-week would be just long enough to give jobs to every one. My estimate is that we need a 20-hour week now. Industry and business could operate as many hours a week as they wish; they would only have to put on more shifts.

This regulation of the work-week would be permanent. The Hours-of-Labor Commission would make the work-week short or long, as economic conditions changed. No matter how much or how little production—that is, work—there was, everybody who wanted a job would have one. We would lose the long line of unemployment; never again would we fall a victim to that unnecessary stupidity.

The present emergency justifies the immediate calling of Congress to pass on the submission of the Constitutional amendment to the Legislatures of the different states. It justifies the immediate convening of the Legislatures, to take action on the amendment.

With everybody employed, the nation would be freed of the terrific strain that is now almost causing it to fly into a thousand pieces, like a crystallized wheel.

The country would be freed of the burden of public and private contributions to support the destitute.

The unemployed would be freed of the misery of doubt about the next meal.

Those who are employed would be freed of the agony of fear that they will lose their jobs.

We would have a confidence which, by comparison with our present condition, would be the return of prosperity.

We would see an immediate pick-up in consumption, for two reasons:

First, employment, even on part-time, would give our present unemployed more money to spend than they now have under the piddling dole of the Reconstruction Finance Corporation;

Second, those who are employed would feel free to spend their hoardings for things they need but are doing without, because they would not be afraid of being thrown upon the street to-morrow.

I do not propose that a full week's pay should be given for a part-week's work. That would be a shock to the economic system which I do not believe it could stand without preparation.

It may be said that this plan would put no more purchasing power into the country than it now has, because it merely divides the present wages among more persons. That is true, in theory, and it would be true in practice, but only for a short time.

I believe that consumption would be so increased by the removal of the fear to spend, that there would be an instant increase in production. This would mean a call for more man-power, which would mean a longer work-week and more pay.

I believe that business would be so stabilized by this confidence, and by the elimination of dumping and rushing upon greater losses, that all employers would be justified in immediately increasing wages at least ten per cent, and probably twenty-five per cent, or even more, after a few weeks.

As conditions improved, I believe we would work into a higher rate of pay than we have seen in the past. The trend of wages has been upward for a century, and if we help that trend, we will be contributing impressively to the development of our country, the enjoyment of its resources, and the living standards of the people who would measure their wealth by consuming power, not by the standards of the past.

2 comments: said...

Wow! If a proposal is made by a New Orleans cotton manufacturer in 1932, that must make it right, just as Chapman being an early 20th century neoclassical theorist must make his proposals right.

Sandwichman said...

"This will be my last comment on this for some time, as, sorry, this issue is simply one that I am not all that worked up about one way or the other."

"Not all that worked up," you say? Hmmmm.