1946 - Commerce

Commerce

Housing shortages and pent-up demand for consumer goods lead to runaway prices and rising wage demands in much of the world.

Some 260,000 electrical workers strike Westinghouse and General Electric January 15, and more than 750,000 steelworkers walk off the job January 19 in the biggest strike thus far in U.S. history (see General Motors strike, 1945). Ford Motor Company and Chrysler Corp. settle their strike with the United Automobile Workers (UAW) in January, agreeing to pay another 18½ cents per hour (an increase of 17.5 percent), but they do not agree to hold down the prices of their cars. A wage-pattern formula announced by President Truman February 14 entitles labor to 33 percent wage increases that equal the rise in the cost of living since January 1941. Steel makers agree February 16 to grant an 18½¢-per-hour wage increase that raises workers' pay to $1.09 per hour and passes the cost along by raising steel prices by $5 per ton (see 1952). An employment act passed by Congress February 20 declares that maximum employment must be the government's policy goal.

President Truman reestablishes the Office of Economic Stabilization February 21 to control inflation (see 1943). He names former advertising executive Chester Bowles, 45, to head the office.

General Motors resolves its strike by the UAW March 13, granting a wage increase half a percent higher than the company's initial proposal, but strikes idle some 4.6 million U.S. workers during the year with a loss of 116 million man-days, the worst stoppage ever. Unions were unable to strike during the war, wages have failed to keep pace with price increases, and workers make up for lost time.

U.S. troops seize the nation's railroads May 17 in the face of imminent strikes. Troops seize American soft coal mines May 22 to end a strike begun April 1. John L. Lewis has brought his United Mine Workers back into the American Federation of Labor (AFL) late in January (see 1936). Speaking to a joint session of Congress May 25, President Truman says the railroad strike is no ordinary labor-management dispute; he asks Congress to let him draft railroad workers into the army, interrupts his speech to accept a note, announces that a brief strike has been settled on terms acceptable to the president after he has recommended wage boosts, but his threat to draft workers costs him the support of labor leaders and liberals in the fall elections. John L. Lewis leads his membership out on strike again November 21 in defiance of a federal injunction and is fined $3.5 million December 4; the workers return to the pits December 7.

The Office of Price Administration (OPA) expires June 29 when the president vetoes a Compromise Price Control act; Congress revives the OPA July 25 with a new Price Control act.

Canada institutes family allowances (see Britain, 1945). Sales of children's shoes jump from 762,000 pairs per month to 1,180,000 as parents receive financial aid.

Parliament votes February 13 to repeal the British Trades Disputes Act of 1927, legalizes certain kinds of strikes, and lifts most restrictions on labor unions' political activities.

The British Government takes over the Bank of England February 14.

Economist John Maynard Keynes, 1st Baron Keynes, dies at Firle, Sussex, April 21 at age 62, worn out from his labors during the war.

France nationalizes the Banque de France, the 82-year-old Société Générale and other banks pursuant to legislation enacted last year by the Parlement. The four commercial banks that are taken over account, with the Banque de France, for half the assets and liabilities held by the nation's banks.

Parliament nationalizes the British coal industry in May with a law that is to take effect January 1, 1947.

May Day celebrations in Japan bring out hundreds of thousands of workers waving red flags and demanding recognition of their new labor unions, higher pay, and better working conditions (see 1947).

Moscow announces August 8 that 200 key East German industries will be brought under Soviet control; the nationalized industries will be turned over to the East German government in 1953, Moscow promises.

Hungary suffers the worst inflation in world history as the gold pengo of 1931 falls in value to 130 trillion paper pengos in June. The government prints 100-trillion pengo notes.

High meat prices bring demands that President Truman resign, but prices soften when the government withdraws from the market in the summer and prices break when the OPA removes price ceilings in the fall.

President Truman issues an executive order November 9 lifting all wage and price controls except those on rents, sugar, and rice.

The U.S. inflation that will continue for decades begins December 14 as President Truman removes curbs on housing priorities and prices by executive order. President Roosevelt's inflation control order of April 1943 kept prices from climbing more than 29 percent from 1939 to 1945 as compared with a 63 percent jump in the 1914 to 1918 period, but Truman is more worried about a possible postwar depression than about inflation.

Wall Street's 50-year-old Dow Jones Industrial Average reaches a post-1929 high of 212.50, falls to 163.12, and closes December 31 at 177.20, down from 192.41 at the end of 1945.