The Progressive Democracy of James M. Cox
Chapter Six - How He has Dealt with Industrial Relations
HOW HE HAS DEALT WITH INDUSTRIAL RELATIONS
The story of the result of Governor Cox's treatment of industrial issues is told in his parallel of statements from Thomas J. Donnelly, Secretary of the Ohio Federation of Labor, and W. S. Thomas, a leading manufacturer.
Statement by Donnelly:
"Before Ohio had a Workmen's Compensation Law, only twenty per cent of the injured workers, or the widows and children of deceased workers, were paid any compensation or damages. Eighty per cent got nothing whatever. When Cox was first elected governor, about five per cent of the workers of Ohio were covered under an optional Workmen's Compensation Law. His first move as governor was to insist upon the passage of a Workmen's Compensation Law that would benefit all the workers. In this he met with powerful and bitter opposition. But through his determined efforts the opposition was overcome and the law was passed. To-day the Ohio State Insurance Fund is the largest carrier of workmen's compensation insurance, public or private, in the world. More than a million dollars a month is being collected by this fund, all of which is paid out for compensation and medical treatment for the injured workers or the dependents of those who are killed in the course of employment. This law supplied such an urgent need in the state that the employers and the laboring people of Ohio now look upon it as an accomplishment that outshines any other achievement in the state's history.
"The report of the legislative agents of the Ohio State Federation of Labor show that fifty-six laws in behalf of laboring people were passed during Cox's three terms as governor. Among these were laws forbidding the exploitation of women and children and limiting their hours of labor, providing for mothers' pensions, providing for safety codes to protect life, limb and health and numerous other beneficent measures."
Statement by Thomas:
"His strong sense of right and wrong, and the exercise of an unusual common sense, together with his frankness and courage in expression, have been the controlling factors in his successful relationship with the business interests of the state.
"A single example of his wisdom will illustrate this. For years organized labor and organized capital in Ohio have met during he sessions of the general assembly in what seemed to be a necessary antagonism. This was evidenced by the opposition of each to the proposed measures of the other. The result was ill feeling and little accomplished for either. It was Governor Cox's suggestion that these organizations, represented by the State Federation of Labor and the Ohio Manufacturers' Association, through their executive officers, should meet together and discuss pending legislation relating to the interest of either. Finally this plan was adopted, and it is the testimony of those participating tat it did much to avoid misunderstandings, and contributed a great deal towards sane and safe legislation. There is not known any instance of this plan being adopted in any other state of the Union. The fruit of this sensible procedure is that there are no laws in Ohio that hamper industry, impede business or endanger property interests, and at the same time the state is foremost in legislation that promotes social welfare, gives labor its due, and helps the weak and needy.
"A man who has occupied this position without interruption during three administrations would be a failure at the very outstart if he resorted to devious conduct or political duplicity. He has but one master--the people at large. To reach this position he had to have courage, be truthful, exercise sound and practical business judgment, and at the same time have a vision looking to the betterment of the condition of his fellow-man."
The cornerstone of the labor legislation is the Workmen's Compensation Law, the story of which is told in the state archives, in the messages to the Ohio General Assembly. At the beginning of his first term as Governor in 1913, Governor Cox said:
"It would certainly be common bad faith not to pass a compulsory Workmen's Compensation Law. No subject was discussed during the last campaign with greater elaboration, and it must be stated to the credit of our citizenship generally that regardless of the differences of opinion existing for many years, the justice of the compulsory feature is now admitted. Much of the criticism of the courts has been due to the trials of personal injury cases under the principles of practice which held the fellow-servant rule, and assumption of risk and contributory negligence to be grounds of defense. The layman reaches his conclusion with respect to justice along the lines of common sense, and the practice in personal injury cases has been so sharply in conflict with the plain fundamentals of right, that social unrest has been much contributed to. A second phase of this whole subject which has been noted in the development of the great industrialism of the day has been the inevitable animosity between capital and labor through the ceaseless litigation growing out of these cases. The individual or the corporation that employs on a large scale has taken insurance in liability companies, and, in too many instances, cases which admitted of little difference of opinion have been carried into the courts. The third injustice has been the waste occasioned by the system. The injured workman or the family deprived of its support by accident is not so circumstanced that the case can be contested with the corporation to the court of last resort. The need of funds compels compromise on a base that is not always equitable. Human nature many times drives sharp bargains that can hardly be endorsed by the moral scale. In the final analysis the cost of attorney fees is so heavy that the amount which finally accrues in cases of accident is seriously curtailed before it reaches the beneficiary. These three considerations clearly suggest the lifting of this whole operation out of the courts and the sphere of legal disputation. And then there is a broader principle which must be recognized. There is no characteristic of our civilization so marked as the element of interdependence as between social units. We are all dependent upon our fellows in one way or another. Some occupations, however, are more hazardous than others and the rule of the past in compelling those engaged in dangerous activities to bear unaided the burden of this great risk, is not right. The Workmen's Compensation Law in this state, which, however, lacks the compulsory feature, has made steady growth in popularity. The heavy decrease in rates clearly indicates economy and efficiency in the administration of the state liability board of awards. The compulsory feature, however, should at once be added. I respectfully but very earnestly urge its adoption amendatory of the present law with such other changes as experience might dictate.
"The objective to be sought is the fullest measure of protection to those engaged in dangerous occupations with the least burden of cost to society, because after all the social organization must pay for it. The ultimate result of this law will be the reduction in death and accident because not only the humanitarian but the commercial consideration will suggest the necessity of installing and maintaining with more vigilance modern safety devices.
"Government as a science must make its improvement along the same practical lines which develop system, simplification, classification of kindred activities, and better administrative direction in the evolution of business. A private or corporate enterprise is compelled to promote in the highest degree both efficiency and economy because its income is subject to the hazards of business. Government without this spur of necessity because its revenue is both regular and certain, does not effect reorganizations and combine common activities so readily. One reason, of course, is that new legislation is required and that is not easy at all times. Wherever human energies are now being directed toward more efficient public service, we find the consolidation under one administrative unit or bureau of all departments which deal either in direct or different manner with the same general subject. Investigation develops many duplications in both labor and expense in the departments of the state. No business institution would continue such a policy and recognizing now the importance of conducting the business of the commonwealth along the same modern and efficient lines of private and corporate operations, there is submitted herewith to your honorable body two recommendations which, in my judgment, are of tremendous importance, namely, the creation of an Industrial Commission and a Department of Agriculture. The first named organization would combine every existing department which deals with the relation between capital and labor. It is certainly a logical observation that the department heads clothed with the responsibility of details will find it extremely difficult to rise to the moral vision necessary to construct and conserve policies dealing with big things. Besides duplication of service is a waste of both human energy and state funds."
In summing up the results of a single year of Workmen's Compensation Law, the Governor at the beginning of 1915 said:
"The humane results of the Workmen's compensation Law have been so widespread and the wisdom of the people in changing the constitution so as to make this plan compulsory has been so completely demonstrated that manufacturer and employee now join in praise of the act. While the liability insurance companies contend that the State could not administer this trust and that the cost would run into millions of dollars per year, the experience of the first twelve months shows the cost of the administration to be approximately $160,000; and the claims, running far in excess of 50,000 in number, have been adjudicated with such promptness as to justify in the fullest measure the soundness of the State plan. The balance in the fund December 15, 1914, was $2,418,414.07. The number of accidents is diminishing and the cost to the employer is decreasing; so that both lower rates and larger compensation seem assured. As one who passed through the stormy period that led to the passage of this law, I urge upon you the extreme importance of the highest manifestations of vigilance, patriotism and humanity in order that the fundamentals of this beneficent legislation may be preserved. Under the pretext of improving the law it can be easily emasculated. Ohio assumed the lead in this legislation, and if the fundamental principle is maintained here, the plan, by its demonstrated worth, will be adopted elsewhere. This means the ultimate loss of ill-gotten millions by potential interests that have grown rich from the tears, blood and maimed bodies of our working people. They will not give it up without a continued struggle. Your duty to humanity and to your State calls for extreme watchfulness.
Though he suffered defeat for re-election in 1914, neither the Industrial Commission Law nor the Workmen's compensation Law nor any other major piece of social legislation was disturbed by his successor. In reviewing four years of the history of the law at his re-accession to power in 1917, he said:
"Since the adoption of the law there have been 300,000 industrial accidents and only seventeen suits have been brought against employers who paid into the state insurance fund. There was but one single verdict rendered by the court against the employer in the list of seventeen and that was for $2000. Five cases were settled out of court, four were decided in favor of the employer, one was dismissed by the employee, one was dismissed by the court and four are still pending. More than one thousand firms carry their own insurance under state consent, and against these institutions but five suits have been brought. Against the employers who have reinsured with the liability insurance companies, eight suits have been instituted, making a total of thirty law suits from all sources. These figures are procured from the official records of the Industrial Commission."
Two years later, in 1919, a further chapter is given:
"The experience of our state with the Compulsory Workmen's Compensation Law bears so vitally on the industrial life of our people that it is deemed proper to report the outstanding features of the situation. The amount of money in the fund held by the State as trustee for the injured workmen and their dependents, as of date, January 2, 1919, was $15,401,429.74. So carefully measured has been the cost of human justice that employers pay a smaller premium-rate in Ohio than elsewhere, and the injured workmen and their dependents are given larger compensation. A dramatic circumstance which bears eloquent testimony in behalf of this law is here recited: Not long since a workman was injured in a factory through which runs the boundary line between Ohio and Pennsylvania. The accident occurred a few feet east of our state, but the poor fellow crawled back onto the soil of Ohio because he knew the difference between our law and the law in Pennsylvania. As a further evidence of the basic soundness of the law and the character of its administration, I have directed the Industrial Commission to have an actuarial audit of the fund in its charge, with the imposed condition that the Ohio Federation of Labor, the Ohio Manufacturers' Association and the State Auditor be consulted in the employment of the most competent actuary, obtainable outside the state service, to do the work."
This, then, is the story, but not all of it. Having its genesis in the meetings between labor and capital, there has been worked out by the two an elaborate code of safety rules which have been officially promulgated by the commission and have the binding effect of law. To-day capital and labor will demand of his successor that his heart and mind be in accord with the program carried to fruition in his six years as Governor. There are other points in his service, briefly covered here, in these lists:
Laws Pertaining to Business
A public utilities law providing property re-valuation as a basis for rate making.
Provision for court appear from the utilities commission decision to the court of final jurisdiction, preventing delay and loss.
Prohibition against injunction on rate hearing without court investigation.
A uniform accounting system applied to utilities.
A state banking code with close co-operation with the federal reserve system, bringing all private banks under state supervision.
State expenditure on a budget system to reduce cost of government and lessen taxation.
A blue-sky act to encourage proper investment and protect against fraudulent securities.
A State Industrial Commission with powers to handle all questions affecting capital and labor, with a state mediator as the keystone.
Complete survey of occupational diseases with recommendation for health and occupational insurance.
Full switching crew in all railroad yards.
Strengthening the user in the state of railroad safety appliances.
A full crew law.
Twenty-four foot caboose.
Reduction of consecutive hours of employment for electric railroad workers.
Obstruction of fixed signals prohibited.
Safeguarding of accidents in mines by proper illumination.
Extra provision for dependents of men killed in mines.
Increased facilities for mine inspector operation.
Protection of miners working toward abandoned mines.
Elimination of sweatshop labor.
Provision for minimum time pay day.
Prohibition of contract labor in workhouses.
Provision for minimum wage and nine-hour working day for women.
Eight-hour working day on all public contracts.
Codification of child laws with establishment of child welfare department.
Compulsory provision for mothers' pensions.
Verdict by three-fourths jury in civil cases.
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