The Wage Stabilization Board (WSB) was an

independent agency A regulatory agency (regulatory body, regulator) or independent agency (independent regulatory agency) is a government authority that is responsible for exercising autonomous dominion over some area of human activity in a licensing and regulati ...

of the

United States government The federal government of the United States (U.S. federal government or U.S. government) is the national government of the United States, a federal republic located primarily in North America, composed of 50 states, a city within a fede ...

whose function was to make wage control policy recommendations and to implement such wage controls as were approved."Executive Order 10161, September 9, 1950," John Woolley and Gerhard Peters, The American Presidency Project, no date. There were two agencies with the same name. The first, the National Wage Stabilization Board, was the successor to the National War Labor Board, and existed from January 1, 1946, to February 24, 1947. The second, the Wage Stabilization Board, was a part of the

Office of Defense Mobilization The Office of Defense Mobilization (ODM) was an independent agency of the United States government whose function was to plan, coordinate, direct and control all wartime mobilization activities of the federal government, including manpower, economic ...

and existed from September 9, 1950, to February 6, 1953.

National Wage Stabilization Board

The first agency, known as the National Wage Stabilization Board, was established by President

Harry S. Truman Harry S. Truman (May 8, 1884December 26, 1972) was the 33rd president of the United States, serving from 1945 to 1953. A leader of the Democratic Party, he previously served as the 34th vice president from January to April 1945 under Franklin ...

within the

United States Department of Labor The United States Department of Labor (DOL) is one of the executive departments of the U.S. federal government. It is responsible for the administration of federal laws governing occupational safety and health, wage and hour standards, unemploym ...

in on January 1, 1946. The purpose of the new agency was to continue the work of the National War Labor Board.

Executive Order In the United States, an executive order is a directive by the president of the United States that manages operations of the federal government. The legal or constitutional basis for executive orders has multiple sources. Article Two of th ...

9809, issued on December 12, 1946, abolished the National Wage Stabilization Board effective February 24, 1947.

Wage Stabilization Board

The Korean War broke out on June 25, 1950. After an initial (and significant) surge of

inflation In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reductio ...

, President Harry S. Truman's war

mobilization Mobilization is the act of assembling and readying military troops and supplies for war. The word ''mobilization'' was first used in a military context in the 1850s to describe the preparation of the Prussian Army. Mobilization theories and ...

effort began to achieve some success in stabilizing the American economy.Hogan, p. 353-355. On September 8, 1950, the U.S. Congress enacted the

Defense Production Act The Defense Production Act of 1950 () is a United States federal law enacted on September 8, 1950 in response to the start of the Korean War.Congressional Research ServiceThe Defense Production Act of 1950: History, Authorities, and Considerati ...

. The Act gave the President statutory authority to order companies to do business with the United States in order to furnish equipment and services needed for national defense; to establish federal agencies as needed to implement the Act; and to allocate resources, personnel and funds to ensure national defense needs were met. However, the Act tied wage controls to prices. If any price ceiling was imposed, the government was required to issue regulations and orders stabilizing wages in the affected industry. The next day, President Truman issued

(EO) 10161, which established the

Economic Stabilization Agency The Economic Stabilization Agency (ESA) was an agency of the United States Government that existed from 1950 to 1953. The creation of the ESA was authorized by the Defense Production Act (, 64 Stat. 798), which was signed into law by President ...

(ESA) to coordinate and supervise wage and price controls. Utilizing the wage and price control model developed in World War II, the Truman administration created two sub-agencies within ESA. The

Office of Price Stabilization An office is a space where an organization's employees perform administrative work in order to support and realize objects and goals of the organization. The word "office" may also denote a position within an organization with specific dut ...

(OPS) was given the power to regulate prices, while the Wage Stabilization Board (WSB) oversaw the creation of wage stabilization rules. The division of labor was specifically designed to unlink wages from prices. If prices rose automatically with wages, the inflationary spiral would continue unabated. Placing the onus solely on workers to keep wages low risked the wrath of labor, a lesson the administration had learned from the WWII experience. Delinking wages and prices leveled the playing field. Both workers and employers would now be forced to justify, independently, the wages and prices they demanded. The Wage Stabilization Board was authorized to control wages only for hourly employees. However, the WSB's authority in this regard was extremely limited.

Structure

The

had overall authority to coordinate and implement wage and price policies. Within ESA were three sub-agencies: *The Office of Price Stabilization (OPS), which recommended price control policies to the ESA, and implemented policies which ESA had approved. *The Wage Stabilization Board, which recommended wage control policies to the ESA, and implemented policies which ESA had approved. *The Office of the Housing Expediter (OHE), which recommended rent control policies to the ESA, and implemented policies which ESA had approved. The WSB had nine members. Three members represented the public, three represented labor, and three represented business and industry.Loftus, Joseph A. "Truman Setting Up Price Unit with Ching Slated As Head." ''New York Times.'' September 30, 1950. Initially, the WSB's three "public" members were

Cyrus S. Ching Cyrus S. Ching (May 21, 1876 – December 27, 1967) was a Canadian-American who became an United States, American industrialist, federal civil servant, and noted trade union, labor union mediation, mediator. He was the first director of the F ...

, director of the Federal Mediation and Conciliation Service;

Clark Kerr Clark Kerr (May 17, 1911 – December 1, 2003) was an American professor of economics and academic administrator. He was the first chancellor of the University of California, Berkeley, and twelfth president of the University of California. Bi ...

, professor of industrial relations at the

University of California, Berkeley The University of California, Berkeley (UC Berkeley, Berkeley, Cal, or California) is a public land-grant research university in Berkeley, California. Established in 1868 as the University of California, it is the state's first land-grant u ...

; and

John Thomas Dunlop John Thomas Dunlop (July 5, 1914October 2, 2003) was an American administrator, labor economist, and educator. Dunlop was the United States Secretary of Labor between 1975 and 1976 under President Gerald Ford. He was Director of the United Sta ...

, a professor of economics at

Harvard University Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of higher le ...

. The three labor representatives were Harry C. Bates, president of the

International Union of Bricklayers and Allied Craftworkers The International Union of Bricklayers and Allied Craftworkers (BAC) is a labor union in the United States and Canada which represents bricklayers, restoration specialists, pointers/cleaners/caulkers, stonemasons, marble masons, cement masons, ...

;

Emil Rieve Emil Rieve (June 8, 1892 – January 24, 1975)Saxon, "Emil Rieve, Unionist, Dies," ''New York Times,'' January 26, 1975. was an American labor leader. He was president of the Textile Workers Union of America (TWUA) from 1939 to 1956, a vice preside ...

, president of the

Textile Workers Union of America The Textile Workers Union of America (TWUA) was an industrial union of textile workers established through the Congress of Industrial Organizations in 1939 and merged with the Amalgamated Clothing Workers of America to become the Amalgamated Clo ...

; and Elmer Walker, president of the

International Association of Machinists The International Association of Machinists and Aerospace Workers (IAM) is an AFL–CIO/ CLC trade union representing approx. 646,933 workers as of 2006 in more than 200 industries with most of its membership in the United States and Canada. Or ...

. The three business representatives were Henry B. Arthur, manager of the research department at meat processor Swift & Co.; J. Ward Keener, vice president of the B.F. Goodrich tire company; and Reuben B. Robinson president of the Champion Paper Co. The WSB was politically divided, however. On April 21, 1951, President Truman issued Executive Order 10233, which reconstituted the Wage Stabilization Board. Its members increased from nine to 18, and it was now given the power to issue recommendations and reports directly to the President in wage disputes.

History

The reconstituted board did not retain all its powers for long, however. Executive Order 10276, issued on July 31, 1951, established the Office of Rent Stabilization. The new office was given the WSB's rent control powers, as well as given new powers to encourage the construction of rental units in areas near defense industries. By the end of 1951, the Office of Rent Stabilization had controlled the rent for 6.8 million rental units. On October 19, 1951, the WSB issued its first wage dispute resolution case. On August 30, 1952, Truman signed Executive Order 10390, which provided for alternate members for the WSB.

Abolition

On February 6, 1953, President

Dwight Eisenhower Dwight David "Ike" Eisenhower (born David Dwight Eisenhower; ; October 14, 1890 – March 28, 1969) was an American military officer and statesman who served as the 34th president of the United States from 1953 to 1961. During World War II, ...

issued Executive Order 10434, which effectively abolished the Wage Stabilization Board.Loftus, joseph A. "White House Ends All Wage Control, Many Price Curbs." ''New York Times.'' February 7, 1953.

References

Bibliography

"Executive Order 10161. September 9, 1950." John Woolley and Gerhard Peters, The American Presidency Project. Santa Barbara, Calif.: University of California (hosted), Gerhard Peters (database). No date.
Accessed June 2, 2007. *Hogan, Michael J. ''A Cross of Iron: Harry S. Truman and the Origins of the National Security State, 1945-1954.'' New York: Cambridge University Press, 1998. *Marcus, Maeva. ''Truman and the Steel Seizure Case: The Limits of Presidential Power.'' New York: Columbia University Press, 1977. *''The National Wage Stabilization Board, January 1, 1946-February 24, 1947: A Documentary History of the Board Together With Brief Explanations of Its Formation, Organization, and Activities.'' South Hackensack, N.J.: F. B. Rothman, 1973. *Pierpaoli, Paul G., Jr. 'Truman's Other War: The Battle for the American Homefront, 1950-1953."'' ''OAH Magazine of History.'' 14:3 (Spring 2000). *Pierpaoli, Paul G., Jr. ''Truman and Korea: The Political Culture of the Early Cold War''. Columbia: University of Missouri Press, 1999. {{Authority control Defunct agencies of the United States government History of labor relations in the United States Defunct independent agencies of the United States government Government agencies established in 1945 Labor relations organizations Wages and salaries