BUSINESS
08/28/2013 07:31 am ET Updated Aug 28, 2013

Doubling The Minimum Wage May Seem Insane, But It Happened In 1949

AP

Even as he’d confidently promised before television cameras in January that he would deliver an astounding increase in the minimum wage, the president knew it would be a difficult fight. Unprecedented federal debt and thorny unemployment weighed heavily on Washington, both cautioning against forcing businesses to give low-paid workers a raise.

The president's own top economic expert had told him the government shouldn’t further distort the dynamics of the free market. Big business was adamantly against the plan.

And Congress? That lot of obstructionist conservatives and their “do nothing” attitude would relish any chance to get in the administration’s way, especially if its members could call him a “socialist” and once again bring up his controversial universal health care plan.

So it was in 1949, when President Harry Truman (D) declared the federal minimum wage ought to be nearly doubled, from 40 cents an hour to 75 cents. Using a measure of what minimum-wage earners could purchase with that amount compared with the rest of society, the 1949 increase is roughly the equivalent of a wage today jumping to $10.70 from $5.70.

As labor activists across the U.S. begin a round of Labor Day strikes this week in a bid to increase the wages of low-paid workers, raising the minimum wage from $7.25 to $15 has become a rallying cry of the boldest proposals. With most political forecasters declaring President Barack Obama’s more modest call for a minimum wage raise to $9 dead in the water, the idea of more than doubling the minimum wage is generally dismissed as fanciful.

But it's not unprecedented.

This is the story of how, in spite of sustained political opposition, a presidential administration was once able to give the most downtrodden American workers an 87.5 percent pay increase.

To earn minimum wage in 1949, especially for those who had a family to support, was to live in want and poverty. At a time when the social safety net largely did not provide housing, a worker would have needed to save nine years’ worth of full-time wages to buy a four-room house. As a result, minimum-wage families lived in slums. An hour’s pay of so-called starvation wages, 40 cents, was enough for a worker to buy two Happy Meal-sized McDonald’s hamburgers and 13 ounces of Coke.

In spite of that, Congress had refused to raise the minimum wage from its 1938 level in both 1947 and 1948.

The country was facing a turbulent economic time, with deep recessions in both 1946 and 1949. Economists were nervous the U.S. would not keep growing as it had during WWII. Conservatives -- a coalition of Southern Democrats and Republicans -- controlled both chambers of Congress and were vehemently opposed to the president’s extension of Franklin Delano Roosevelt’s New Deal, with the so-called Fair Deal.

After winning his first term in 1948, Truman could have pushed a timid compromise to get a quick victory on the minimum wage. Centrist Republicans had earlier put their support behind an increase to 60 cents.

Instead, he chose the hard way, pushing a minimum wage bill that was unapologetically liberal.

The president pushed for an increase to 75 cents across the board. The White House bill also allowed for industry-specific rates as high as $1 per hour. The law as originally written would have extended minimum wage protections, which at the time covered only one-third of the labor force, to nearly a half of all workers. In a provision companies found especially distasteful, it allowed government agents to sue employers for back wages.

Clark Clifford, Truman’s White House counsel, would later explain the president’s plan as an attempt “to strike a new high ground”

“He wasn’t going to pacify a Republican Congress, whatever he did,” Clifford later wrote.

Historians told The Huffington Post that original minimum wage bill had no chance of passage.

“I don’t think the administration or congressional leadership ever thought they were going to get what they had asked for,” said Mark Byrnes, an associate professor of history at South Carolina’s Wofford College, who authored a book on politics during the Truman years.

Alonzo Hamby, an emeritus professor of history at Ohio University, told HuffPost the original bill was an opening bid in what the White House knew would be months of haggling.

“Truman was an experienced politician who knew he wouldn’t get everything he asked for,” Hamby said. “He took some solace in thinking that he had been in the right to ask for it.”

Immediately, the opposition pounced.

“The South was dead-set against it,” Byrnes said.

Large business interests, including companies like S.C. Johnson, the Metropolitan Life Insurance Co., Standard Oil and General Motors, upped their lobbying against the president’s proposal. The U.S. Chamber of Commerce, representing those large employers, spelled out a detailed case against the minimum wage increase by citing reasons why the idea was bad economics. Both inflation and unemployment, chamber economists said, would rise because of an increase.

In a particularly bombastic pamphlet explaining the organization’s view, the chamber compared the fight for a higher minimum wage to the economic policies of the dictators Hitler and Mussolini. If the federal government “does something” about low wages, it would be no different than “the way Stalin ‘does something’ about eliminating unemployment,” chamber economists wrote.

Lobbies for the cotton, hotel and retail industry also mounted intense campaigns, wining and dining congressmen with annual salaries of $20,000 a year into denying fellow citizens the right to earn slightly more than $1,500 per year.

“This town is jumping with lobbyists on this thing,” an unidentified Democratic congressman told The Associated Press at the time.

Truman and his allies in Congress had expected the pushback. Indeed, historians told HuffPost, it is likely the administration purposely presented such a liberal bill in order to both rouse opposition and overcome it. While making it clear he would not budge on the increase to 75 cents, the president began negotiating away other aspects of the bill in exchange for House votes. In particular, provisions extending the minimum wage to more workers, at first seen as a liberal fantasy in an ill-fated bill, became tokens the president could trade away for House votes.

The legislative horse-trading slowly eroded the opposition, and turned the president’s foes against each other. When it looked like Truman had enough votes, House Republicans presented a face-saving compromise bill that allowed them to claim the wage increase was partly a GOP initiative. It passed the House by an overwhelming 186 to 116.

“That’s an extraordinary tally,” Byrnes, the Wofford college historian, said.

Writing at the conclusion of the 1949 session of Congress, a columnist for The New Republic explained the president’s strategy:

“Truman would ask Congress for about 120 percent more than he expected. Congress, with a great show of indignation, would slash it down to 75 percent ... It’s a funny way to run a country. It’s not the Roosevelt way. But at the close of the session, there the score is. It’s been creeping up. It’s impressive.”

In the Senate, Truman waged a lawmaker-by-lawmaker war of attrition.

The kingmaker of the Senate was Ohio Republican Robert Taft. Truman loathed Taft. Presidential plane staff members would later recount their standing instructions to flush toilets on board the aircraft any time it happened to fly over Taft’s home state of Ohio. (An aide to the senator, for his part, would later describe how Taft once got so angry with the president he ended up with “blood in the nostrils.”)

In spite of personal animosity, Truman and Taft were able to work out a quid pro quo. When the White House got wind that the senator was trying to curry favor with newspaper publishers, the administration let Taft know it would support his amendment to the bill denying the minimum wage to paperboys. Similar deals were hammered out with other senators. Protections for switchboard operators, loggers and farmhands were all sacrificed at the altar of political compromise.

“Whatever the president might have said in public in those days, and whatever those congressmen said in public -- and it was pretty stiff sometimes -- they were able to sit down and do business in the end,” Hamby, the Ohio University historian, said.

The minimum wage bill passed the Senate in by a vote of 50 to 23 and was signed by the president on Oct. 26, 1949.

It wasn’t just political maneuvering that allowed the Truman White House to pass the minimum wage bill, historians noted.

“You can’t simply see Truman as a political animal,” said John Moser, a professor of history at Ashland University in Ohio. “He was genuinely sincere about this.”

Truman, who had been an unsuccessful businessman prior to going into politics, was moved by a deep-seated belief that society needed to do right by its least-fortunate members, historians said. He made it known in Washington that to fight him on the minimum wage would be an affront beyond politics.

“He understood the problems ordinary people have and had a degree of sympathy for them,” Hamby said.

The near-doubling of the minimum wage in 1949 had none of the negative effects critics had predicted. Unemployment did not rise and business activity was not curtailed. A 1954 Labor Department study found at least 1.3 million people received immediate raises as soon as the increase went into effect.

Following the minimum wage victory, Truman failed in passing much of his labor agenda, as domestic policy fell victim to the politics of sustaining the war in Korea after 1950.

Yet Truman was satisfied enough to crow during his last State of the Union address in 1952 that “our democracy has not forgotten how to use the powers of the government to promote the people’s welfare and security.”

The U.S. would go on to experience more than two decades of unprecedented economic prosperity.

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