The Industrialists: How the National Association of Manufacturers Shaped American Capitalism

Abstract

Before reading Jennifer Delton's book, I thought of the National Association of Manufacturers (NAM) as a parochial, nationalist, protectionist, conservative organization that fought furiously against unions and was founded by midsized midwestern companies in the 1890s to promote American manufacturing goods overseas. This view, which I imagine is common among labor historians, is not entirely accurate. The NAM was more complicated than that, as Jennifer Delton demonstrates in her highly informative study of the association from its founding until today.To begin, although the large majority of the association's members were small and midsized manufacturers, it also enrolled the presidents of the largest manufacturing corporations in the United States. During its most influential period, in the early twentieth century, it was led by David Perry, who owned the country's largest carriage-manufacturing plant. Perry's factory covered six city blocks in Indianapolis and employed 2,800 workers. Perry also owned and directed other companies. Small companies paid low annual dues to the NAM; large ones paid far more and, not surprisingly, carried greater weight in the association's decision-making. The NAM was not exclusively midwestern either. On the contrary, the initiative for the association came from southern manufacturers as well as Ohioans; consequently, the membership encompassed both Republicans and Democrats. The formation of the NAM in 1895 was part of the larger bonding of southern and northern institutions a generation after the Civil War. It is also a mistake to view the association as systematically protectionist. Denton explains that the NAM was often internally divided on the question of tariffs, as one would expect from a mixed group of southern and northern manufacturers, and consequently often opted not to take a stand on that subject.The NAM led the Open Shop Drive against AFL unions beginning in 1903 and remained unqualifiedly hostile to unions through the mid-1930s. Over time, however, the association's leaders and staff moderated their stance. While some of the members never changed their views, the NAM staff who helped shape the Taft-Hartley Act conceded the legitimacy of unions and collective bargaining in exchange for sharp limitations on union practices. Denton describes the 1947 law as “a peace of sorts, a settlement, in NAM's long-running war against big unions” (136).By the 1980s the NAM was led by a Democrat: Alexander Trowbridge, an Allied Chemical executive who had previously served as secretary of commerce in the Johnson administration. Its chief economist, Jerry Jasinowski, was a former aide to Senator Hubert Humphrey, who in that capacity had helped craft the Humphrey-Hawkins Full Employment Act in 1978. Although the association opposed that law, NAM leaders testified in favor of affirmative action policies in the 1970s and 1980s and even earlier strove to persuade its members to hire, retain, and promote African Americans, other minorities, and women. Ultraconservatives always had a home in the NAM, Denton notes, but after World War II its officers and especially the staff were “more pragmatic, more influenced by business and management schools, and less committed to ‘rugged individualism’ ” (188).From its founding the NAM consistently pressed for promotion of foreign trade throughout the world, including with the Soviet Union as early as the 1920s and the Peoples Republic of China beginning in the 1970s. The association officially supported the Marshall Plan, the Bretton Woods Agreement, the General Agreement on Tariff and Trade, the International Chamber of Commerce, the World Court, the Organization for Economic Cooperation and Development, and even the United Nations, despite resistance from more than a few of the members. The NAM was an early and consistent proponent of globalization.By the 1980s, however, the association was in a quandary. As a conservative business group, the NAM ardently supported Ronald Reagan in the 1980 presidential election and in most realms loyally supported his administration. Yet much like conservative Christians, who received little beyond words from the administration, the triumph of Reagan and his ideas “offered very little to old-line manufacturers, NAM's bread-and-butter” (265), Denton observed. The widespread plant closings of the 1980s hurt not only millions of factory workers and American unions but also NAM members who were the targets of hostile takeovers. In fact, by the mid-1980s the NAM had much in common with the AFL-CIO. Both were trying to protect “smokestack” industries, both were losing members, and both were alienated from their historical political parties. NAM president Trowbridge reached out to AFL-CIO president Lane Kirkland to see if they could “bury the hatchet.” Although nothing came out of this entreaty, the gesture itself was a sign of NAM's dilemma. Denton argues that Reagan's economic policies favored real estate, finance, and technology sectors, while giving little to traditional manufacturing firms (266).Although the NAM revived during the Clinton administration, by the turn of the twenty-first century the organization was a shadow of its former self, with fewer members and less influence than the US Chamber of Commerce, the Business Roundtable, the National Federation of Independent Businesses, or the Conference Board. “Having tied its fortunes to economic globalization, having welcomed into its fold companies from other countries [such as Toyota], having shared its know-how over the decades with foreign manufacturers, NAM constantly pushed beyond the ‘National’ in its name and eventually created a world where it no longer makes sense to talk about US manufacturing, or any other nation's manufacturing” (316), Denton concludes.This insightful history of the National Association of Manufacturers belongs on labor historians’ bookshelves along with other such fine studies of US business, including Judith Stein's Pivotal Decade, Marc Linder's Wars of Attrition, and Kim Phillips-Fein's Invisible Hands.