Welcome to Working History, a production of the Southern Labor Studies Association. Become a member online at www.southernlaborstudies.org. I'm series host Beth English and today I'm speaking with Katherine Reijul, Assistant Professor of History at Fishbrook State University. She's the author of Dollars for Dixie, Business and the Transformation of Conservatism in the 20th Century, published by Cambridge University Press.
Kate Jule, welcome to Working History. Thank you. It's great to be here. Your book Dollars for Dixie looks at the roots of a type of political and economic conservatism in the United States, defined by a number of things, free market capitalism, conservative fiscal policies, and limited bureaucracy, which you, in your book argue, grew in part from an organization based in the South, known as the Southern States Industrial Council, which was organized in 1933.
So, to start us off, could you talk a little bit about and maybe just in broad brush strokes about what the SSIC was, why it was organized, and who comprised the membership of this group? Sure. So, the SSIC was really, it started as sort of an offshoot of the National Association of Manufacturers and is this one guy in particular who really spearheaded the organization with his inner circle of connected industrialists across the region. His name was John Edgerton, and he had been president of NAMM through the 1920s, for 11 years he was president, which in his own way is kind of a remarkable origin story because he was the president of this small, woolen manufacturer, industrial company in Lebanon, Tennessee, the middle Tennessee about 30 miles from Nashville.
It had about 80 employees, but he rose to be the head of this prominent manufacturers organization in the 20s. And he really was a champion of anti-unism during the decade. When the depression hit, and his leadership were rejected, really he was kind of kicked out in 1931. And Edgerton and other industrialists really felt as the New Deal launched that the South needed a strong voice in Washington that NAMM wasn't enough to represent the needs of Southern industry as the New Deal was accelerating.
Though these guys were mostly Democrats, they were business progressives, but they were wary of what the result administration might hand the South in terms of policy. And they also saw themselves as representing Southern industry on the national stage. They modeled themselves after the New England Council, which had formed in the 1920s, to really to confront the flow of textile manufacturing to the South. And so the SSIC represented the ongoing institutionalization of the economic rivalry that was developing and intensifying between the regions in the 1920s.
So they found their impetus to really pull the organization together after the passage of the National Industrial Recovery Act, one of the first programs in the New Deal, part of the first New Deal. And they focused particularly on the idea of wage differentials. They operated like other business associations did, lobbying basically in Washington. And it was really an organization of textile manufacturers.
Not only was this the leading industry in the region, it was also the region, the region's most prominent industry that had the most potential to be transformed by the New Deal. Unlike the lumber industry, for example, or its extracts, which had a majority of interest in the South, textiles had been moving to the South for the previous decade, but the industry as a whole was still dominated by northern interests with factories that paid much higher wages than in the Southern factories. So they saw themselves as most likely to have their arrangements with their workers, their low wages basically, be undermined by the New Deal. Given this, when we think of the backgrounds of the members of SSIC, of its leaders, are they very much sort of cunning out of the typical new South businessmen cohort, if you will, that really was sort of a champion of selling the region as a low wage, unorganized, native labor, all those sort of mantras that you heard a lot at the turn of the century.
Are these guys really still trying to sell that version of the South? Absolutely. These were the are were the boost boosters of the region, most of the members and their names, you know, anybody who's who's read, you know, Stephen Woodward's origins of the New South, looking at the leaders of the SSIC, they will see the names, the same surnames come up over and over again, but they are the sons, the grandsons and the nephews, really of those founders. These were the builders of Southern New South industry, multi-textile leaders.
A few had grown very large, such as bid manufacturing or Avondale mills, the Comers, you know, who were connected to Alabama politics, you know, some of them had multiple sites of production, but it did draw a lot of support from, you know, single factory firms like Edgerton's Lebanon, Willamills. It drew from, I guess, these county seat elite types, right, to use that phrase. These were people who, you know, had some connection to progressivism about, you know, Southern business progressivism in that style. They saw themselves as leaders in their town or in their state.
Some of them also were investors in industry, a lot of bank presidents or retailers joined the SSIC or paid dues in any case. Basically, it drew widely, not only from industrialists, but also anybody who was interested in building the industrial base of the region and making sure that the South remained competitive. Right. And if you could just back up a tiny bit, you had mentioned the National Industrial Recovery Act.
I was wondering if you could maybe for maybe a more general listener who might not be familiar with that. Just explain briefly what that was, you know, the codes, quote unquote, that came into use as part of that and how these, you know, these textile industrialists would have experienced that. Sure. So the National Industrial Recovery Act is set up the NRA, which is, for my people, it's the National Recovery Administration, not the National Rifle Association.
Right. And other people would know it now, right? Yes. So the NRA allowed businesses to get together, it suspended antitrust laws, it allowed them to share information such as what they pay their workers, what their production costs were, marketing arrangements.
And they basically worked on kind of a voluntary basis so that, you know, an industry where our manufacturer would come, or the leaders of industry, as well as representatives of liberal, come to Washington, they'd sit on a code board. There'd be oftentimes a business association representative present. And they would come to terms as to what constituted fair wages and operating for practices, basically, in each industrial sector. So the textile manufacturers had their own code, lumber manufacturers had their own code, and it really ran the gamut of all of these industrial sectors.
And it could vary very, very complex, very quickly. But for people in the SSIC, these manufacturers, they are going to Washington to meet, and they found themselves to be in the position of a minority, the way that they put it, on these code boards. And so they saw Northern manufacturers setting wages at a rate higher than what Southern manufacturers paid. So they had to increase their wages at a higher percentage than what Northern manufacturers say it would have had to, just because these kind of regional differentials and the costs of doing business, as they said.
And so they saw this as profoundly unfair, that this was basically the brunt of the recovery falling on their shoulders when they were the most vulnerable in the nation, industrial region in the nation. And so they would point to the South's deficiencies. And they generally, genuinely saw themselves going back to this new South ideal. These are also those paternalists, that they were giving their workers a chance to have an industrial life.
But of course, their argument is unfair to make them pay the same rate as industrial workers in the North, who had generations experience in industry, these were people coming from subsistence agriculture, from the hills into the mills in North Carolina, and largely unskilled. And so they had no problem drawing on this idea of deficient Southern labor to make this case that the NRA should have differentials built into it based on region. So the Northern workers would have to pay. So in the textile code, it would be $13 a week, and the South should have a differential where they would only pay $12 a week.
Right. Right. So before we talk a little bit more about what the SSIC was doing during the New Deal, could you explain just a little bit how and why you ended up choosing this particular group to focus on for your study? So it's kind of a funny story.
A friend of mine reminded me of the saying about how your first book as a historian is oftentimes about your family, you're talking about your book. And for me, this is absolutely true. Because my family from Lebanon, Tennessee, Robert John Edgerton's, Lebanon, and William Mill was, and not only that, my grandfather worked there, my great aunt worked there, my dad worked there. So my family were mill workers, basically.
And my dad, he worked there during summers when he was in college, but my grandfather had, his family had moved to Lebanon from the surrounding hills in the 1920s. And when his father was injured, and he actually quit school during the Depression to help support his family and worked in the spinning room at the mill. And he actually started working there after the NRA. And he made what, her week when his former supervisor had made.
Wow. He just had raised that much that just a teenager coming in to work in the mill, what a supervisor used to have made. That was one of the first things he told me. So when I was a student at Vanderbilt, I was taking David Carlton's new South class.
And I went to him and I said, well, you know, my family worked in this mill. And I'm sort of interested in how it fits into the larger history. And David said, I'll never forget that. I was standing up there to get some olive Vanderbilt.
He says, oh, John Edgerton, he was the head of this rather nasty organization. Yeah, that's what I say. And I said, and you're like, ding, ding, ding, ding, ding. I like that.
I will totally, I'll totally investigate that. And it turned out that my uncle had gone to high school with John Edgerton's granddaughter. And so I really became intrigued by this idea that, you know, here is this really powerful industrial figure whose history had no recollection of. And what do you think about the South in general?
You know, I never associated with these types of people yet. These industries were really central to the reorganization of my family's life and to the town and we're really instrumental in building these towns. But if you drive around, you know, these kind of county seats in the South, you'll see civil war generals and you'll see these empty mill buildings. But there's really no popular memory that exists about them and the world that they play.
They're really kind of invisible, both on the landscape and in memory. And so I really became intrigued by, you know, where did these people go? And you know, was this just sort of something that happened and now we're sort of left with these, these empty mills or, you know, is it still vibrant? What kind of legacy did it have?
So I started asking these questions and I found their papers, which are the Tennessee state library and archives and was like, well, I'm just going to go for it. I'm just going to figure out what the story is here. Great. So let's talk a little bit more about the organization then and maybe go back some more into the New Deal and then moving forward as the region sort of moves through the years of World War II.
When we think of the New Deal and we think of Southern Democrats as kind of their own thing in a lot of ways within the Democratic Party, can you talk about how the SSIC was working with or against Southern Democrats generally, but also with other industrial groups active in the South at this time? So as far as other industrial groups went, they didn't have an adversarial relationship with any of them really until the 1950s when they split over foreign trade and trade policy. Instead, they saw themselves as filling in a gap between the national organizations like NAM and its state branches or the US Chamber and the industry specific associations, many of which did have standalone associations for Southern industry. So the SSIC would step in and represent industries that had too few Southern firms to warn their own association, glove manufacturers, for example, Edgerton and other representatives showed up at those code boards meetings to make the case for the Southern wage differential.
Or when it came to the New Deal more broadly, they articulated a Southern specific set of arguments that the NAM or the Chamber could not articulate without damaging their other members. So things about the unique position of the South and its deficiencies. The climate gets too hot and we can't run full year at 100% or our freight rate differentials are put as a disadvantage or the agricultural origin of our labor or the more racist arguments they made about labor. But as for how they worked with politicians to influence the New Deal, it turns out just how they went about this.
They literally wind and dined Southern Democrats. They were very much political insiders. They knew these leaders in Congress, sometimes related to them, and they operated within the networks of the Democratic Party throughout the South. The SSIC's General Counsel, Tyree Taylor, who was with the organization well into the 1950s and maybe in the early 1960s.
He had been a leader in the young Democrats in North Carolina and usually based in Washington, most of the time meeting consistently with Southern leaders. So they really tended to identify with leaders of Congress, these Southern Democrats socially. They moved into some more social circles, attended same social functions, and they really played up the kind of paternalistic language that they shared with Congress. And that they were trying to best represent the South and its needs.
And so these Southern Democrats had to pay attention to what the unique needs of Southern business was alongside the rest of the South. Is this messaging then translate when you have the politicians who are sort of the mouthpieces, if you will, of SSIC and other industrial groups? Is that then translating into how policy is being shaped? Or are these Southern Democrats, especially initially during the early years of the New Deal, just sort of screaming in the forest and not really getting any traction?
Or is this effective, selling this particular view of the region? It was effective with a certain cohort of Southern Democrats. This tactic that they had of hosting these lavish dinners really revealed some of the slits that the Democratic Party had, not just nationally, but in the South as well. There's this fight that John Etrichin got into with a member of Congress, the Firebrand Texas representative, Maury Maverick, which actually where the term political Maverick comes from, he's quite notorious.
Maverick detested the SSIC and what they represented, this kind of elite Southern politics with this paternalistic language. When the SSIC invited him to one of these stick dinners to appeal to them to weaken the New Deal regulations toward the South, Maverick basically went to the press and just excoriated the Etrichin and the SSIC called it Pink Team, lobbying and you know, applying this with stake. In some ways, this fight might seem like it could be cast as the origins of the split of the Democratic Party in the South. But it was more complicated than that.
It was more that the SSIC thought that they could still use the New Deal, right? That they could convince these politicians to just make small changes that would benefit the South, right? They were still Democrats, right? They wanted to attach their wagon to the party and steer it in the direction that would be most beneficial to them to use it to gain competitive advantage or leverage against their competitors.
The irony of this is that this is of course the charge that they're pointing at Northern industrialists, right? That they're trying to use the New Deal to stamp out upstart competitors from the South. So I mean, in many ways, they did fail, right? That they weren't able to stop interventions into the New Deal's wage structure.
With the NRA, you know, they had probably more success, but it might have been more of an accidental success, but the NRA had such internal problems and so complicated and ultimately ruled unconstitutional that anything that these guys were arguing was really not at the root of its failure. But they really weren't able to block the key policies that would impact the South, which were the Fair Labor Standards Act and the Federal Minimum Wage. So they really had to adjust their tactics. Through this process with from the National Industrial Recovery Act in 1933 to the Fair Labor Standards Act in 1938, where are we seeing labor fitting into this story, right?
I mean, are they sort of the counterbalancing argument that, you know, or arguers, I should say to this, you know, when you think of the New Deal as sort of, you know, government mediating between capital and labor in that kind of classic seeing of that time. What's happening there? Because it seems like, you know, in a lot of ways, labor is having these sort of spectacular successes. There's a lot of grassroots organizing.
You have Section 7A, protecting labor rights in the NRA. You have ultimately the Wagner Act and 35 and so on. So, you know, what's happening on that side of it? Are they, you know, is SSIC and labor really budding heads a lot?
Or are they kind of, you know, forging their own paths here? So labor in many ways is central to the story, even though individual laborers don't make a large appearance. So really the labor organizations, you know, they kind of, there's these moments where they mock the SSIC as just sort of another example of what management wants to hand the Southern worker. But they're central because at the root of the story here, it's about what labor and the organization empowerment of labor meant to these industrialists.
So while wage differentials were of concern and later minimum wages that would remake the Southern wage structure, industrials were primarily concerned about the concentrated power of labor and the way that that would unseat them and their power in the Democratic Party. So one of the big puzzles of Southern economic history of course, as centered around why the South has had less success with unionization, right? So it continues up until the present. And we know the stories about, you know, union brigings such as the Chancellor of Burlington Mills strikes and people, failure in the 1940s.
So what this book does is it places Southern businesses, peers of unionization, which they saw not just as an economic threat, but as a social and political one. I would not see these social and political influence that they had at the center of political transformation of the South in the 20th century. And so it's really this that's the crucial step towards political change for these business leaders. This is the path that would lead them to seek out politicians such as very gold water, you know, as a story and a commissioner and Kim Phillips fine has shown, and unionism was key to the invigoration of conservatism and business leaders at the head of that.
And so what this does is it adds kind of the Southern business wing into that story. Of course, as I mentioned, Edgerton had this strong reputation as a crusader against organized labor and he was no less critical of labor going through the new deal. As a matter of fact, when he interviewed his granddaughter, she asked me to find out organized crime connected to labor unions was responsible for his death. He died somewhat mysterious circumstances in 1938.
Basically sounds like he ate a bad hamburger and had food poisoning. But she just absolutely insisted that there was something nefarious that had gone here. So there's clearly there's an adversarial relationship. But beyond those kinds of conspiracies and demonizations, these industrialists really saw labor as people they wanted to cultivate first with that paternalistic language, but also with their commonality as white southerners.
And they saw their workers as potentially malleable recipients of their arguments. These arguments that really changed over time in the way that they approached it. But they would do things like print pamphlets so that employers could put them in their pay envelopes. Pamphlets with titles like the fallacy of the minimum wage and these sort of demonizing language towards the new deal.
So even as the SSIC's arguments and tactics evolved, they always had this kind of educational mission at the center of their activism with their eye on stamping out labor organization. So how does the SSIC's approach come to shape wider views of political economy and move forward the organization's ethos, if you want to call it that in the region, especially then as World War II takes place, the new deal winds down and then into the post four years. So the second part to that question, where does conservatism fit into the story and how are these business, industrialists at the forefront? So the real tension between their pragmatism and their ideology throughout the story and how they get these things to come in line with one another.
So Southern Industries success was predicated on low wages, on this competitive advantage or really a more of a probably appropriate to call it a competitive disadvantage. But rather than highlighting the benefits of their region's industry, the kind of booster behavior we've come used to talking about, they tend to point to the region's disadvantages. It's climate, it's education, it's the background of its workers, it's low wages, great, great structures. All these are problems that the South faced that they pointed out, which is sort of grounded in this kind of bottom line of here's what it costs to do business in our area, but also here are the impediments that we face to making profits.
But at the same time, their conservatism started with cultural and social concerns, that they wanted a hierarchical Southern society in which they occupied positions of economic and social status. In this way, they shared a lot with other kinds of conservatives who didn't have the same sort of economic concerns that they did. Oddly enough, they even shared this with the agrarians. So while these leaders weren't, these business leaders weren't intellectuals, they shared affinities with the kind of Southern exceptionalism that a figure like Donald Davidson trumpeted.
By the 1950s, Davidson saw himself as the lone remaining agrarian, but he saw the SSIC oddly as one of his allies, as another defender of a traditional hierarchical South, particularly when it came to race. The SSIC saw that hierarchical society as key to their competitive advantage in low wages. He likely met the SSIC's rising star, Thurmond Sensing, at National White Citizens' Council meetings, and they really formed a friendship and an alliance. So I tend to think of this marriage as kind of a pre-fusion moment that these regional partisans needed to find common ground between this kind of pragmatic economic argument and this traditional conservatism that could be then married and incorporated into the national movement in the 1950s.
So both Davidson and SSIC affiliates like Anthony Harrigan maintained connections to those national conservative circles from R.C. to Buckley and the National Review. So if the South wants to be considered part of a conservative movement, it needed more than a commitment to traditional hierarchical social arrangements. As Jay Langdell argued, that form of traditional conservative became conservative, became increasingly superfluous to the national movement.
So the SSIC really helped connect those traditional conservative arguments to this emerging idea of free enterprise. Right. And before we talk about free enterprise, which ultimately is a recurrent theme of your book, do you see the civil rights movement and sort of the ramping up of that if we think of it as sort of the long civil rights movement being part of this movement towards, as you called it, a fusion of these disparate groups, but the same kind of thinking that was driving them? For the SSIC, the civil rights movement was really, in their eyes, a confirmation of what they've been saying all along, that they really mobilized beginning in 1933 against federal intervention in the South.
And so it started with minimum wages, you know, in maximum hours and the wage differential. And they were able to shift their focus to civil rights to say, look, see, this is just more of what the federal government has in mind for us. That they want to remake our region to end our, quote unquote, southern way of life and, you know, to completely undermine, you know, southern society. So you know, you can see them mobilizing against the fair employment practices, commission, and attempts to make it permanent after World War II.
That was kind of the first sign of this, but they had already been creating these arguments about the South and free enterprise that they would really look to in fighting civil rights. So they are absolutely committed to white supremacy into segregation throughout that's consistent in their politics and in their worldview, but the arguments that they use to attack the civil rights movement and, you know, the New Deal and the fair deal, that undergoes transformation. So let's get back to the issue of free enterprise. How does this emerge as a key issue or rallying point, if you will, around which, as I see in other groups, focus?
So this transformation or this incorporation of free enterprise takes place really in the late 1930s and early 1940s as they realize that they are going to not be able to stop, you know, this intervention of the federal government into their wages. And they realize that this argument that they've taken about the exceptionalism of the South and its deficiencies, that this is actually going to work against them. One of the key turning points is the report on conditions in the South, the famous report from the National Emergency Council in the preamble to which Roosevelt calls the South the nation's number one economic problem. And what's odd is that that the arguments within that report are the things that the SSIC have been pointing to since 1933 as the reason that they needed a wage differential.
And now that it was being arid by the federal government, they're going, whoa, wait a minute, this is a bad idea. This is not the reputation that we want to develop for our region. And so they begin to shift towards articulating the South as they would in capital letter that the nation's number one economic opportunity, right? In the first year, there's all this potential, you know, human capital that has yet to be unleashed and if only the federal government would treat us fairly, then we could realize all of this economic potential.
And so as those arguments begin to backfire, they begin to turn towards this language of free enterprise. And what they argue is that the South becomes, they hold up the South as a kind of paragon of functioning free enterprise, where you don't have these really entrenched bureaucracies or regulations. New York had longstanding minimum wage laws and worker protections. We don't have that in the South.
And particularly after the war, they're the forefront of passing right to work laws. That it all ties into this idea of the South as the home of free enterprise. And so these are the arguments that they use to reshape their image of the South in the national political eye. I have an entire chapter on freight rates, which, you know, I would joke with my editor that, you know, is trying to make freight rates great again.
I'm just horrible. I try to make, I really try to make them interesting. I do. Because it's really in the freight rate controversy that they realize the power of this argument.
Right. And they begin to go against actually what a lot of those other Democrats are saying that they were so successful in promoting this argument with Southern Democrats that now that they take it up and are saying that we need to protect the South from these unfair freight rates, they're going, no, no, no, no, no, wait a minute. It's, you know, we want to let firms negotiate their own rates with shippers and not have the federal government intervene and regulate those rates that we need free enterprise to set the rates. And so it's a reversal, but it's also a new way to think about the South and its relationship to federal policy and a more positive light.
But in a lot of ways still sort of the same, same messaging, right, except, I'm sorry, not really the same as just saying, but sort of the same thinking behind different messaging is that. Yeah, it's the same bottom line interests, right? Ultimately, it's about local control of wages and operating costs and contracts. But with a very different gloss later the top of it, instead of a kind of paternalistic new South, as the reason for this, it is, you know, free enterprise in particular in the context of the emerging Cold War.
Right. They see this as something that they can really hit show I can still do. Right. So what happens to the SIC and what do you see as it's as a legacy long term?
So for the organization in the 60s, they grow increasingly reactionary, but also more nationally focused. So when it comes to their reactionary politics, some of them are very cognizant of this and they don't want to be seen as a fringe kind of birch like group, but at the same time, they are very committed ideologically or increasingly committed ideologically. They're mentioned actually in the report on assassinations in connection to Martin Luther King Jr's assassination. There is a rumor that circulated that SSIC members were getting together basically a ransom for his assassination.
It's never really followed through. It's kind of unconfirmed, but it is also not surprising given their politics regarding civil rights all along. What it comes to is economics in the 1960s, it shifts really towards small and medium sized manufacturing and particularly anti free trade politics in the international sense that they begin to see the competition that they had offered to the North in the 1920s that they were now falling subject to from abroad in the 1950s. And so they really shift their politics more into that area, but at the same time, they become nationalized and they changed their name in the early 1970s.
They changed a couple of times for a while. They're in educational organizations, but it's the United States Business and Industrial Council, which still exists. It's very different, very much more focused on international trade and the undermining of national wages. And I guess America first kind of follows these that we see coming from the Trump administration that they receive influx of cash from red, milken industries who in the late 1960s is looking to Ronald Reagan, but who was also a strong protectionist.
So they grow more narrow. They grow more reactionary and then they kind of transform over the course of the 1970s and the 1980s into a very, very different organization without that regional basis. But as these voices withdraw as they shift towards these national conversations, I would say that the region that they shaped has continued to play an important role in politics. That there is a legacy about how the South fits into the larger national political economy and culture that they play the role in.
At the end of the book, I suggested that a new voter identity kind of emerges out of this legacy that they left, the cracker barrel vote is what I talked about then, that- Also, Lebanon, Tennessee, right? Yes. It comes while circle, right? Yeah, it comes while circle because the civil war statue and then the cracker barrel, right?
Those are the two poles of southern identity and popular culture, but what's missing is this kind of middle piece of the way that these industrialists built towns like Lebanon that now vote a particular way, but that are sort of married to this kind of booster business climate, political economy of right to work laws and low regulation and low taxation. So even though you don't have those industrialists themselves advocating with the same force at the national level, the politics that they have left and those commitments do remain. Okay, Joel, Dollar's Cambridge University Press. And thank you for listening to this episode of Working History produced by the Southern Labor Studies Association.
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