Coal: New Fuel for Inflation?

As volatile as the explosives they work with, coal miners have a long history of blasting the best-laid plans of mine operators, coal users and U.S. Presidents. For the past month the United Mine Workers, torn by dissension and corruption, have been negotiating with the mine owners to formulate a new labor contract and avoid a strike on Thursday, Sept. 30, when the present pact expires. Though a peaceful settlement seems likely, nobody is discounting a walkout that could threaten the nation's critical need for electric power and jar the Administration's new economic policies.

Coming in the midst of President Nixon's wage-price freeze, the situation poses an immediate challenge to the Administration's goals. U.M.W. President William Anthony ('Tony") Boyle has said that he will try to make any benefits effective immediately by seeking an exemption from the freeze--a request that is sure to be turned down by the Cost of Living Council. Even if the miners agree to wait until the freeze ends on Nov. 13, their pay boost will probably have to be ruled on by whatever wage-price review board may be created during Phase II of the Administration's program. The miners' demands include 1) daily wage increases ranging up to $13 over three years, bringing the pay for the highest-ranking workers to $50 a day; 2) a doubling, to 80-c- of the "royalty" on each ton of coal that the operators pay into the union pension fund; 3) paid sick leave and improved welfare benefits.

Any settlement along those lines would probably be greater than the inflationary contracts agreed to recently in steel, copper and aluminum. Those industries settled for rises in wages and benefits of 30% or more over three years. The miners argue that all the increases provided in their present contract have been eaten up by inflation. Largely as a result of productivity gains, today's 100,000 miners produce more than did the 400,000 men who worked in the industry in 1950. The operators could certainly live with a fat pay increase. Last year the after-tax earnings of seven major mining concerns doubled to $47 million. The rising need for electric power practically insures that demand for coal will continue increasing at its present annual rate of 4.5% for a long time to come.

Yet even a peaceful labor settlement would be no guarantee against trouble. The union is ripe for rebellion. Admirers of Joseph Yablonski, the assassinated U.M.W. official who lost a presidential race to Boyle in 1969, have maintained their dissident organization called Miners for Democracy. The Labor Department is now in court seeking to force a rerun of the 1969 election on grounds that it was conducted illegally. Boyle is under indictment by the Justice Department, charged with illegally using union funds for political contributions. To add to Boyle's problems, another bloc called the Black Lung Association has threatened wildcat strikes if he does not raise his wage-and-benefit demands even further.

Testing Credibility. Boyle faces still another major test: President Nixon's post-freeze policies aimed at curbing inflation. If the White House stands by its pronouncements, any wage-review board would have to reject a settlement in the 30% area. The union's reaction to that, warns Boyle, would be to "fight." At worst, a strike could result in a power shortage, forcing the Government to take over the mines and possibly bring in troops to work them. That would further inflame organized labor and might vitiate the President's entire economic program.

If the Administration backed down in its first important wage confrontation, the consequence could be shattered credibility. The miners are by no means the only workers pushing for "more." The International Longshoremen's Association, representing 45,000 dockhands from Maine to Texas, stands ready to walk out when its contract ends Oct. 1. If negotiations collapse, a nationwide dock tie-up is possible; stoppages by West Coast dockers have closed down ports since July 1. The major East Coast demand is the expansion of a featherbedding wage guarantee to compensate union members for work lost because of containerization.

In addition, the Brotherhood of Railroad Signalmen may also strike on Oct. 1 unless its present wage rate of up to $3.78 an hour is raised by a huge 54% over a little more than three years. Contracts are also running out in the aerospace industry. The International Association of Machinists and Aerospace Workers and the United Auto Workers are bargaining with McDonnell Douglas and Lockheed Aircraft. A prime demand: enriched cost of living benefits.

Obviously, organized labor has not fallen in line with the President's wishes. The Administration's response will test its ingenuity and determination to make its policies succeed.

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