Evening star., 1946-01-18
Text of FoirIess and Murray Letters

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The tert OF the letter from
Benjamin F. Fairless, president
OF the United States Steel Corp,
to President Truman tolloWs:
Dear Mr.. President:
Your proposal to me in Washing
ton last evening that the wage de-
mand of the United Steelworkers
OF America -CIO be settled on the
basis of wage increase of 1872
cents an hour, retroactive to Jan
uary /, 1916, cannot, I regret to say,
be accepted by United States Steel
Corp. for the reasons set forth be-
low:
AS you must be aware, your pro-
posal is almost equivalent to grant.
ing IN full the unions revised de-
mand of a wage increase of 1917
cents an hour, which was advanced
by Phillip Murray, the president
OF the union, at our collective bar
gaining conference with the union
IN New York a week ago today. In
our opinion, there is no Just basis
from any point of view for a wage
increase to our steel workers of the
large size you have proposed, which.
If put into effect, is certain to result
IN great financial harm not only to
this corporation but also to users of
steel in general.
AS I have tried to make clear TO
you and other Government officials
during our conferences in Washing
ton over the past few days, there is
a limit in the extent to which union
wage demands can be met by us.
We reached that limit when we
raised our offer to the union last
Friday from wage increase of 1871
cents an hour to one of IS cents an
hour. This would constitute the
highest single wage increase ever
made by our steel-making subsidi-
aries. Our offer of Is cents was
equivalent to meeting 500 of the
unions original excessive demand of
a 81 day general wage increase.
Our offer met 75To of the unions
flnal proposal of wage increase of
1914 cents an hour. A wage in
crease OF 15 cents an hour, such as
we offered, would increase the direct
labor costs of our manufacturing
subsidiaries by approximately $780,
OOOOOO year. That Is a most sub
stantlal sum, and does not take into
account the higher costs we shall
have to pay for purchased goods and
services, when large wage increases
generally become effective through
out American industry, as is inevi-
table after substantial increase in
steel wages.
Cites Murray's Position.
AS you know, collective bargaining
negotiations with the union broke
down at the White House yesterday
afternoon, because Mr.. Murray then
refused to bulge from his position
that a countrywide steel strike
must take place, unless steel workers
are granted general wage increase
of 1912 cents an hour Our offer of
a wage increase of Is cents an hour
was again rejected by the union.
The union threatened to 60 ahead
with its program for a national
steel strike at midnight next Sun
day, although such a strike will be
a clear violation of the no-strike
provision contained in our labor
contracts with the union, which
continue by their terms until Octo-
Der IS, 1946.
From the outset, we have recog-
nlzed how injurious a steel strike
will be to reconversion and to the
economy of this whole country. Most
industries are dependent upon a
supply of steel for their continued
operations. We have done every
thing reasonably within our power
to avert such strike. If a strike
occurs the responsibility rests with
the union. ----
When the Government at the
eleventh hour informed us about a
week ago of its willingness to sane
tion an increase in steel ceiling
prices, we at once resumed collec-
tive bargaining negotiations with
the union. Such price action by the
Government was recognition by i'll
of the right of the steel industry to
receive price relief because of past
heavy increases in costs, something
which the steel industry for many
months has unsuccessfully sought to
establish with the OPA.
Some Pertinent Facts.
I should like again to point out
some pertinent facts relative to the
wages of our steel workers.
Since January, 1941, the average
straight-time hourly pay, without
overtime, of our steel workers has
increased more than the 80 per cent
increase in the cost of living during
that period recently computed by
Government authorities. Steel work
ers' wages have kept pace with in
creased living costs. Such average
straight-time pay in our steel-pro-
ducing subsidiaries was S1.14 an hour