(Cambridge Studies On The American South) Katherine Rye Jewell-Dollars For Dixie - Business and The Transformation of Conservatism in The Twentieth Century-Cambridge University Press (2017) PDF

DOLL ARS FOR
DIXIE
Business and the Transformation of
Conservatism in the Twentieth Century
K AT H E R I N E R Y E J E W E L L
i
Dollars for Dixie
Organized in 1933, the Southern States Industrial Council’s (SSIC)

adherence to the South as a unique political and economic entity lim-
ited its members’ ability to forge political coalitions against the New
Deal. The SSIC’s commitment to regional preferences, however, trans-
formed and incorporated conservative thought in the post–World War
II era, ultimately complementing the emerging conservative movement
in the 1940s and 1950s. In response to New Dealers’ attempts to
remake the southern economy, the New South industrialists –heirs of
C. Vann Woodward’s “new men” of the New South –effectively fused
cultural traditionalism and free market economics into a brand of
southern free enterprise that shaped the region’s reputation and polit-
ical culture. Dollars for Dixie demonstrates how the South emerged
from this refashioning and became a key player in the modern con-
servative movement, with new ideas regarding free market capitalism,
conservative fiscal policy, and limited bureaucracy.
Katherine Rye Jewell is Assistant Professor of History at Fitchburg

State University.
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Cambridge Studies on the American South
Series Editors
Mark M. Smith, University of South Carolina, Columbia
Peter Coclanis, University of North Carolina at Chapel Hill
Interdisciplinary in its scope and intent, this series builds upon and extends
Cambridge University Press’s long- standing commitment to studies on the
American South. The series offers the best new work on the South’s distinctive
institutional, social, economic, and cultural history and also features works in a
national, comparative, and transnational perspective.
Titles in the Series
Robert E. Bonner, Mastering America: Southern Slaveholders and the Crisis of
American Nationhood
Ras Michael Brown, African-Atlantic Cultures and the South Carolina Lowcountry
Christopher Michael Curtis, Jefferson’s Freeholders and the Politics of Ownership
in the Old Dominion
Louis A. Ferleger and John D. Metz, Cultivating Success in the South: Farm
Households in Postbellum Georgia
Craig Friend and Lorri Glover, eds., Death and the American South
Luke E. Harlow, Religion, Race, and the Making of Confederate Kentucky,
1830–1880
Ari Helo, Thomas Jefferson’s Ethics and the Politics of Human Progress: The
Morality of a Slaveholder
Karlos K. Hill, Beyond the Rope: The Impact of Lynching on Black Culture and
Memory
Katherine Rye Jewell, Dollars for Dixie: Business, Political Economy, and the Rise
of Conservatism in the Twentieth-Century South
Susanna Michele Lee, Claiming the Union: Citizenship in the Post–Civil War South
William A. Link and James J. Broomall, eds., Rethinking American Emancipation:
Legacies of Slavery and the Quest for Black Freedom
Scott P. Marler, The Merchants’ Capital: New Orleans and the Political Economy
of the Nineteenth-Century South
Peter McCandless, Slavery, Disease, and Suffering in the Southern Lowcountry
James Van Horn Melton, Religion, Community, and Slavery on the Colonial
Southern Frontier
Barton A. Myers, Rebels against the Confederacy: North Carolina’s Unionists
Thomas Okie, The Georgia Peach: Culture, Agriculture, and Environment in the
American South
Damian Alan Pargas, Slavery and Forced Migration in the Antebellum South
Johanna Nicol Shields, Freedom in a Slave Society: Stories from the Antebellum South
Brian Steele, Thomas Jefferson and American Nationhood
Jonathan Daniel Wells, Women Writers and Journalists in the Nineteenth-
Century South
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Dollars for Dixie
Business and the Transformation of
Conservatism in the Twentieth Century
KATHERINE RYE JEWELL
Fitchburg State University
vi
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© Katherine Rye Jewell 2017
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vi
For Mrs. B. K. Hall

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x i
Contents
List of Figures page x

Preface xi
Abbreviations xvii
Introduction: The New South and the New Deal 1
Part I Working within the New Deal 19
1 The New South and the NRA 21

2 Southern Industry and the Southern Region 63
3 Confronting the “Wagner Monstrosity” 94
Part II Free Enterprise and the South 129
4 Creating the Nation’s Economic “Opportunity” No. 1 131

5 Rates, War, and the Turn to Free Enterprise 164
6 The South as the “Bulwark of Democracy” 202
7 Downplaying Dixie 243
Epilogue: The Politics of Free Enterprise 270
Bibliography 291
Index 311
ix
x
Figures
1 “No One Could Object to That,” Birmingham

Age-Herald, February 18, 1934 page 40
2 Total donations to SSIC, 1934–1938 125
3 Railroad donors vs. donations to the SSIC, 1934–1947 182
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xi
Preface
The Lebanon Woolen Mill employed generations of my family. Founded

in 1906 in middle Tennessee, it lured residents of surrounding Wilson
County, who traveled to the larger town in search of work when times
got hard. My great-grandfather was one of those. He lost his hand in
his mobile steam-powered sawmill in 1921 and moved the Jewell fam-
ily from a nearby rural hamlet to seek employment in Lebanon. My
grandfather dropped out of high school in 1931 to help the family make
ends meet. He found a job in the mill’s spinning room, where raw wool
became yarn for the blankets produced at the plant on the outskirts of
Lebanon’s town center. In the 1940s, my great-aunt Bettye Kate became
the mill’s office manager, a job she held for more than forty years. My
father did his stints as a mill employee: at age twelve he mowed Howard
K. Edgerton’s lawn, who was then the mill’s president and the found-
ers’ son and nephew; during summers in high school and while a stu-
dent at Vanderbilt University he ran rewinder machines and hauled bales
of wool.
Lebanon changed dramatically over these years, despite the mill’s con-
tinued presence in the town’s economic life. More plants came to the city,
including Luxe Timepieces and Hartmann Luggage. Grateful for Luxe’s
decision to locate a plant there, city officials allowed the company to set
up production in the high school gymnasium while awaiting completion
of a permanent plant. Yet the service economy began to rival industry
as the main source of employment in middle Tennessee, as elsewhere
in the South. As a child in the 1980s and 1990s, I watched Lebanon
transform, its town square atrophy, and business activity move to the
big box stores and fast food chains near the interstate highway exit. As
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xii Preface
a student at Vanderbilt, one of my professors, David Carlton, told me of

John Edgerton, one of the brothers who founded the Lebanon Woolen
Mill. Edgerton, whose nephew’s lawn my father had mowed, served not
only as president of the National Association of Manufacturers (NAM)
in the 1920s but also founded an organization that promoted the South’s
industrial economy and conservative economic policy: the Southern
States Industrial Council (SSIC). I thus became interested in how the mill
and its founders had disappeared from local memory. Lebanon’s local
economic history jumps from the once famed Mule Day to the outlet mall
by I-40; few testaments to its industrial past remain.
The statue of a local Civil War general anchors the crumbling central
square, which is populated by antique markets and empty storefronts, a
hollow echo of the square’s past civic activity and commerce. This quint-
essential square, featured as Miranda Lambert’s backdrop in her 2007
country music video, “Famous in a Small Town,” evokes images of sim-
pler times and places, but it masks the economic transformation and con-
tinued challenges faced by Lebanon and places like it.1
The family that in 1906 established one of Lebanon’s most prominent
businesses, the Lebanon Woolen Mill, and ran it for more than seventy
years, the Edgertons, is no longer famous in this (now large) town. John
Edgerton had surveyed his native South for opportune sites for invest-
ment. Native North Carolinians, he and his brother chose Lebanon
because of its access to wool. While running the mill, John emerged as
a spokesman for welfare capitalism, mill-village paternalism, and anti-
unionism, and he became NAM president in 1922.2
1 Miranda Lambert, “Famous in a Small Town,” Crazy Ex-Girlfriend, Columbia
Nashville, 2007. Music Video. Dir., Travis Howard (Sony BMG Entertainment, 2007),
YouTube video, 4:01, posted by mirandalambertVEVO, www.youtube.com/watch?v=_
xjy6EuMPGA.
2 George Tindall, The Emergence of the New South, 1913–1945 (Baton Rouge: Louisiana
State University Press, 1967) 71, 109. Edgerton served on the Food Administration under
Herbert Hoover in World War I and as chairman for the European Relief Committee’s
Tennessee chapter; Edgerton communicated with Hoover during his tenure as Secretary
of Commerce regarding economic conditions. As president of NAM, Edgerton coordi-
nated several committees to work with the government regarding business and industry.
When Hoover became president, Edgerton contributed to the Reconstruction Finance
Conference and sat on the National Re- Employment Committee. John Edgerton to
Herbert Hoover, 19 March 1921; Herbert Hoover to John Edgerton, 24 September 1926;
Box 185, Commerce Papers, Herbert Hoover Papers, Herbert Hoover Presidential Library,
West Branch, IA (Hereafter cited as Hoover Papers; Hoover Library). See also materials
related to Edgerton in Hoover Presidential Papers–Secretary’s File, Box 543; President’s
Personal File, Box 80; Campaign & Transition Correspondence, Box 20. Angela K.
Smith, “John Emmett Edgerton,” Tennessee Encyclopedia of History and Culture Online,
University of Tennessee Knoxville, 2010, http://tennesseeencyclopedia.net.
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Preface xiii
No statue of the mill’s founder resides in the city square next to that
of the Civil War general. The woolen mill is quiet. It is the site of an occa-
sional wedding or business venture, devoid of the whirring machines that
shaped the lives of so many. Few Lebanon residents remember that such
a mill ever existed, let alone those county boosters and mill owners who
built it, promising to use the profits to construct a hospital, improve pub-
lic health, and process the area’s raw materials. The sheep, which grazed
the surrounding rocky hills that were unsuitable for cash crops and large-
scale agriculture, no longer dot the landscape or provide the wool the
factory once spun and wove into blankets. The town’s southern identity
is defined less by the industrial life that had dominated for a century than
by the Cracker Barrel country store (the sign of which features a real per-
son, “Uncle” Hershel, who was one of my grandfather’s fishing buddies).
Today, in the early twenty-first century, Lebanon, a community of
around 25,000 residents, is a bedroom town for commuters to booming
Nashville and is also the destination for residents of the surrounding hills
who come to shop at the large Wal-Mart or to work in the town’s remain-
ing manufacturing establishments. The area’s most prominent products
are not the woolen blankets, suitcases, or gears that used to be churned
out from local mills. Instead, Lebanon’s most visible exports are the road-
side Cracker Barrel restaurants.3
In 1969, a group of Lebanon businessmen founded Cracker Barrel.
Decorated with antiques and old photos, the restaurants boast home-
style cooking and, in adjoining stores, sell kitschy knick-knacks, most
of which are “Made in China.” Cracker Barrel’s corporate headquarters
reside on Hartmann Drive in Lebanon, named for Hartmann Luggage,
which has since closed its area manufacturing facilities and been acquired
by Samsonite, leaving only an outlet store selling the leather goods.
Cracker Barrel stores sell a different version of the South’s economic his-
tory, eliding the manufacturing that shaped communities like the restau-
rant chain’s home base.4
3 Towns like Lebanon and cities like nearby Nashville have, for more than a century, lured
rural migrants, and linked the industrial capitalism of urban spaces to the agricultural
countryside. See Louis Kyriakoudes, The Social Origins of the Urban South: Race, Gender,
and Migration in Nashville and Middle Tennessee, 1890–1930 (Chapel Hill: University of
North Carolina Press, 2003).
4 For the service economy’s rise in the South, particularly Wal-Mart, and its links to the
southern and Ozark culture, see Bethany Moreton, To Serve God and Wal-Mart: The
Making of Christian Free Enterprise (Cambridge, MA: Harvard University Press, 2009).
Recent scholars have examined the mythical South, particularly its commodification, but
questions regarding southern identity have been a frequent topic among southern histo-
rians and regional observers for some time. W. J. Cash, The Mind of the South (reprt.,
vxi
xiv Preface
The marketing of ambiguously regional nostalgia has not solved the

town’s mixed manufacturing fortunes. Multinational corporations move
in and out from the industrial parks at the edge of town, lured by short-
term tax breaks, cheap labor, and an antiunion climate. In 2009, Dell
Computer sold its recently built plant in the area after having received
$800,000 in tax breaks to locate there. Lebanon’s economic patterns are
shaped more by shifts in global capital and markets than by the devel-
opmental strategies of homegrown industrial elites. Workers at the Dell
plant received management and production directives from distant cor-
porate managers. Lebanon’s identity as a southern town is more a matter
of nostalgia than of economic structure and business ownership.5
This book thus has two origins. First, it emerged from my inquiry into
how economic changes transformed the city of Lebanon, and my family’s
livelihoods with it. Yet this book is about more than the influence of this
one town; it is about the role that New South industrialists played in
reshaping southern politics and notions of regional identity in the New
Deal and post–World War II eras. And so, second, this book is driven by
an intellectual question that developed as I pursued my research on the
SSIC. How does an organization, which begins as an entity to protect
southern business from national economic norms, become an advocate
of national values and in the process reenvision the region’s place and
significance within the nation?
I first wrote about the SSIC in a seminar paper for Lou Ferleger in
2004. I am indebted to Lou for his guidance, encouragement, and sup-
port. Lou has an uncanny ability to identify the crux of a problem or
1941, Garden City: Doubleday, 1954); John Egerton, Americanization of Dixie: The
Southernization of America (New York: Harper’s Magazine Press, 1974); Fifteen
Southerners, Why The South Will Survive (Athens: University of Georgia Press, 1981);
Dewey Grantham, The South in Modern America: A Region at Odds (New York: Harper
Collins Publishers, 1994); John Shelton Reed, Minding the South (Columbia: University of
Missouri Press, 2003; James C. Cobb, Away Down South: A History of Southern Identity
(New York: Oxford University Press, 2005); Karen Cox, Dreaming of Dixie: How the
South Was Created in American Popular Culture (Chapel Hill: University of North
Carolina Press, 2011). Recent books have examined southern foodways. Scholars note
how Cracker Barrel promotes racialized and cultural notions of regional fare. See Angela
Jill Cooley, To Live and Dine in Dixie: The Evolution of Urban Food Culture in the
Jim Crow South (Athens: University of Georgia Press, 2015); Marcie Cohen Ferris, The
Edible South: The Power of Food in an American Region (Chapel Hill: University of
North Carolina Press, 2014); David Shields, Southern Provisions: The Creation and
Survival of a Cuisine (Chicago: University of Chicago Press, 2015).
5 “Dell Sells Tennessee Remanufacturing to GENCO” Press Release, Dell Computers, 16
July 2009. www.dell.com/learn/us/en/uscorp1/secure/2009-07-16-dell-sells-tennessee-
remanufacturing.
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Preface xv
argument, and I have benefited tremendously from his insights. Bruce

Schulman tolerated my bad music binges when I had the office next to
his, which alone should be testament to his patience and kindness, but
I am most grateful for his generosity, advice, and mentorship, all of which
shaped me as a scholar and a person. Some of my fondest memories of
the weeks I spent at the Tennessee State Library were the evenings with
my undergraduate professor, David Carlton, at Bongo Java discussing
freight rates and smokestacks. Not only did David set me on the path
to study the SSIC; he has inspired me consistently to pursue rigor and
depth in my scholarship and teaching, and I am lucky to be able to call
him a friend. Hugh Davis Graham moved me to add a History to my
already-declared Anthropology major. I am honored to have had him as
an advisor, and he is missed.
I am grateful to many for guidance and scholarly and personal advice.
I’m indebted to the other members of my dissertation committee, Jon
Roberts and Sarah Phillips, whose comments and questions sharpened
my thinking and directed the revisions that would culminate in this book.
I received invaluable mentoring, both personal and professional, from
Nina Silber, Julian Zelizer, Robyn Metcalfe, John Thornton, and Linda
Heywood.
This project would not have been possible without the patient advice
of series editor David Moltke-Hansen. I’m grateful to the series editors,
to Lew Bateman for his guidance through the publication process, and
to the anonymous readers whose thoughtful comments guided my addi-
tional research and writing.
The History Department at Boston University provided travel and dis-
sertation completion funding for the foundational research that would
lead to this book. I also received tremendous assistance from the archives
and libraries consulted throughout this project, including the Tennessee
State Library and Archives and the archivists there, Shaun Hayes at the
American Heritage Center at the University of Wyoming, the librarians
at the University of Alabama, University of Virginia, Vanderbilt, UNC–
Chapel Hill, the Birmingham Public Library, and the other facilities I fre-
quented and contacted in the process of this research.
I received invaluable editorial assistance from Sarah Gallick,
Carolyn Richardson, and Mary Hansen. Several people read the entire
manuscript, or individual chapters, at various stages and listened as
I parsed various arguments, passages, and ideas along the way. My
thanks especially to Ellen Wald, Joe Jewell, and Kristen Miller. I have
benefited from the advice and support of others who have read chapters
xvi Preface
at various stages of this project, including Elizabeth Tandy Shermer,

Michael Bowen, Katie Cramer Brownell, Thomas Underwood, Jay
Langdale, III, David Svolba, Scott Huffard, Daniel Burge, Lisa Hurley,
David Mislin, David Atkinson, Lily Geismer, Julia Azari, and Patricia
Arend. In the case of conference papers I presented on this topic, com-
menters provided insightful advice that shaped the revisions. Among
them were Gavin Wright, Richard Follett, Kari Frederickson, Joseph
Crespino, and Sven Beckert. I am also grateful to the scholars affiliated
with OSSECS (formerly SIP), who have guided me professionally and
offered camaraderie and advice along the way. Jane Xiang and Audrey
Girouard helped me hone the data and evaluate the geographic con-
tours of SSIC membership.
Scholarly projects are indeed the makings of a village, and mine has
some marvelous residents, including Stephen Perkins- Argueta, D. J.
Cash, Anne Blaschke, Zack Smith, Francois Lalonde, Scott Marr, and
at Fitchburg State, Christine Dee, Ben Lieberman, Rod Christy, Sean
Goodlett, Eric Budd, Paul Weizer, Kisha Tracy, and many others.
But of course, we do not live for books alone, although perhaps in
my family they constitute a rather large portion of our waking hours.
I have grown up surrounded by big questions, intellectual and artistic
curiosity, and discussions around the dinner table regarding titles, plots,
writing techniques, and the pursuit of craft and story. The instigators of
these are my parents, Carla and Joe, who also treated me as an equal in
political debates from the time I could talk, and I owe everything to them.
I look forward to seeing the continued growth of three other works that
I produced while writing this book. Leo arrived shortly after completing
chapter three of the dissertation, Oona just weeks after submitting my
manuscript for review, and Niamh was so kind as to be a week late so
I could finish my index. And to the one who fixes things, asks me hard
questions, and is my companion and true love, Conor –you’re simply
the best.
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newgenprepdf
Abbreviations
AAA Agricultural Adjustment Act

ACMA American Cotton Manufacturers Association
AFL American Federation of Labor
CIO Congress of Industrial Organizations
CTI Cotton Textile Institute
FEE Foundation for Economic Education
FEPC Fair Employment Practices Commission
FLSA Fair Labor Standards Act of 1938
GATT General Agreement on Trade and Tariffs
ICC Interstate Commerce Commission
NAFTA North Atlantic Free Trade Agreement
NAM National Association of Manufacturers
NIRA National Industrial Recovery Act of 1933
NLB National Labor Board (under the NIRA)
NLRA National Labor Relations Act of 1935, also
referred to as the Wagner Act
NLRB National Labor Relations Board
NRA National Recovery Administration
SCHW Southern Conference for Human Welfare
SGC Southern Governors Conference
SSIC Southern States Industrial Council
SWPC Smaller War Plants Corporation
TVA Tennessee Valley Authority
UMW United Mine Workers
USBIC United States Business and Industrial Council
UTW United Textile Workers
WPA Works Progress Administration
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1
Introduction: The New South and the New Deal
From the 1880s, the developers of the South’s most prominent industries
tended to be men new to the region. Although they cloaked their profit-
seeking in the paternalistic guise of “uplift” and progressive improvement
for southern workers, these boosters and manufacturers often were not
homegrown elites. Many, such as the Pelzers of South Carolina and the
Loves in North Carolina, were transplants from other regions and had
no connection to the South’s plantation past. Such builders and operators
of Dixie’s mills promoted a modern, economically distinctive, and indus-
trially significant South. They and other post-Reconstruction boosters
campaigned for industrial development and challenged the region’s eco-
nomic base in agriculture while also consuming nearby crops and natural
resources. New South industries processed the cotton, wool, iron ore,
coal, timber, and other raw materials grown, mined, drilled, or hewed
from Dixie’s land.1
The industrialists who directed this work increasingly receded from
view in the post–World War II era. Research parks and large industrial
establishments built by corporations such as DuPont, Firestone, and
1 In 1921, Broadus Mitchell argued boosters had philanthropic intentions in attracting

business and industry to southern locales following the Civil War. Business progres-
sives posited that industrialization could solve social problems. Mitchell praised indus-
try’s benefits and described the appearance cotton mills in the South as a “revolution
from above.” Broadus Mitchell, The Rise of Cotton Mills in the South (reprt., 1921,
Columbia: University of South Carolina Press, 2001). David L. Carlton, “The Revolution
from Above: The National Market and the Beginnings of Industrialization in North
Carolina” in David Carlton and Peter Coclanis, eds., The South, the Nation, and the
World: Perspectives on Southern Economic Development (Charlottesville: University of
Virginia Press, 2003) 136–138.
1
2
2 Introduction: The New South and the New Deal
General Motors, or later by Volkswagen and BMW, overshadowed what

by then had become the South’s traditional industrial economy. As a
result, a simplistic binary of a mythical, preindustrial South and the new,
highway-linked, and suburbanized Sunbelt dominates popular memory.2
A complex history of political activism, regional protectionism, and
economic identity, rooted in southern manufacturers’ experiences with
the New Deal, remains hidden from view. Historians’ dual emphases –
either on the areas reshaped by federal infrastructure investments and
defense contractors or on the booming suburbs and demographic shifts
that reconfigured the region’s political culture –have tended to obscure
the role played by traditional New South manufacturers, and indeed the
continued significance of regional economies, cultures, and politics in the
nation. Those business leaders continued to shape Dixie’s economy and
southern politics during the New Deal and for decades after World War
II. These later generations reprised their forebears’ efforts to develop the
region and its significance within the nation.3
In particular, New South industry’s experience with the New Deal
influenced American political history and the place of the region within it.
Historians of business and the New Deal have investigated the response
of business and corporate leaders, from sector-leading firms to small
businesses, to policy innovations of the 1930s. The sum of such inquiry
has revealed, as historian Colin Gordon described, business’s reaction
as being ultimately fractured and “fickle,” despite policy support for
business’s desire to rein in destructive competition that had exacerbated
economic woes. Yet the South’s leading industrialists proved remarkably
flexible to the changing policy environment. The South’s business elite
2 Kari Frederickson, Cold War Dixie: Militarization and Modernization in the American

South (Athens: University of Georgia Press, 2013); Marko Maunula, Guten Tag,
Y’all: Globalization and the South Carolina Piedmont, 1950–2000 (Athens: University
of Georgia Press, 2009). The emergence of the South’s modern transportation system was
as contested as its evolving political identity, as captured by historian Tammy Ingram.
Tammy Ingram, Dixie Highway: Road Building and the Making of the Modern South,
1900–1930 (Chapel Hill: University of North Carolina Press, 2014).
3 Bruce Schulman, From Cotton Belt to Sunbelt: Federal Policy, Economic Development,
and the Transformation of the South, 1938–1980 (New York: Oxford University Press,
1991); Kevin Kruse, White Flight: Atlanta and the Making of Modern Conservatism
(Princeton, NJ: Princeton University Press, 2005); Matthew D. Lassiter, The Silent
Majority: Suburban Politics in the Sunbelt South (Princeton, NJ: Princeton University Press,
2007); Kenneth T. Jackson, Crabgrass Frontier: The Suburbanization of the United States
(New York: Oxford University Press, 1987); Michelle Nickerson and Darren Dochuk,
eds., Sunbelt Rising: The Politics of Space, Place, and Region (Philadelphia: University of
Pennsylvania Press, 2011).
3
responded to the New Deal by swapping regional and interest-based

and trade association-style lobbying for symbolic politics backed by the
rhetoric of free enterprise. New South industrialists translated activism
from the back rooms of Washington to public advocacy and marketing
of regional opportunity. Without the ability to secure separate treatment
in policy for the South’s wages and labor market, manufacturers looked
to rebranding their region’s status vis-à-vis the nation and crafting policy
at the local and state levels to support this narrative. As this story reveals,
the South’s modern political history is inextricably linked with economic
interest groups, the New Deal, and business’s interpretations of policy
and economic alterations.4
Dixie’s economic and industrial transformation in the mid-twentieth
century and the accompanying revolutions in southern identity and pol-
itics are also rooted in the Great Depression. Yet that cataclysm was
by no means the first displacement, resulting from industrial capital-
ism, to confront the South and its “respectable” educated class. In the
1930s, industrialists –individuals who, despite the importance of their
businesses, had never seemed quite of the South –became the region’s
ardent champions, seeking profits and infrastructure to guide the region to
prosperity. John Edgerton, the president of Tennessee’s Lebanon Woolen
Mill, had been ousted from his position as NAM president in 1931 in the
midst of economic crisis and criticism of business leaders as “economic
royalists.” He recognized that southern manufacturers, as other business
interests, sought to evade the emerging New Deal regulation of wages
and hours, but his region’s needs differed from those of other parts of
the country. He reasoned that these economic distinctions could be polit-
ically useful but were not in the NAM’s power to exploit. He organized a
new business association, the Southern States Industrial Council (SSIC),
so southern manufacturers would not have to rely on national business
4 The SSIC reflected long- standing regional divisions between business interests, the
contrasts between which had fueled southern boosters writing in publications like
Manufacturers’ Record. Robert Wiebe, Businessmen and Reform: A Study of the
Progressive Movement (Cambridge, MA: Harvard University Press, 1962), 11– 12;
Colin Gordon, New Deals: Business, Labor, and Politics in America, 1920– 1935
(New York: Cambridge University Press, 1994), 281; Ellis Hawley, The New Deal and
the Problem of Monopoly: A Study in Economic Ambivalence (New York: Fordham
University Press, 1995); Robert Collins, The Business Response to Keynes, 1929–
1964 (New York: Columbia University Press, 1981); Jennifer Klein, For All These
Rights: Business, Labor, and the Shaping of America’s Public- Private Welfare State
(Princeton, NJ: Princeton University Press, 2010); Kim Phillips-Fein, Invisible Hands: The
Making of the Conservative Movement from the New Deal to Reagan (New York: W.
W. Norton & Company, 2009).
4
and trade associations to represent the South’s particular and peculiar

interests. Founded in Chattanooga in December 1933, the SSIC mobi-
lized to defend the South’s control of labor and competitive advantage –
low wages, access to cheap raw materials, and the mill village. As a result,
the organization and its leaders facilitated a transformation in southern
political and business culture.5
Dollars for Dixie argues that southern industrialists, heirs of the “new
men” of the New South (both literally and figuratively), responded to the
New Deal by gradually shedding their allegiance to a unique, separate
southern economy. When the New Deal commenced, southern manufac-
turers mobilized to maintain and promote a kind of domestic protection-
ism to safeguard their established industries. They wanted regulations
and policies to treat the South independently, to account for what they
portrayed as the region’s deficient industrial sector. Capitalists in this sep-
arate economy, a system putatively shaped by paternalistic obligations
and different methods of capitalization than those deployed by northern
industry, argued that southern manufacturers cared more for their com-
munities’ health, wealth, and culture than for profit maximization –an
artful rather than factual depiction designed to woo political allies. These
industrialists’ critiques emerged not because the Democratic Party was
insufficiently conservative –although that argument would surface in
the latter half of the 1930s –but rather because national policy and the
power structure and rhetoric of southern politics were unresponsive to
the demands of organized southern interests, nor were they adequate to
the economic changes envisioned by southern manufacturers. To protect
New South industry and to promote homegrown capital, the SSIC turned
increasingly, if haltingly, to the language of free enterprise and identified
5 The “collapse of white unity” and resulting southern class structure of bourgeois town
people and a mill-village proletariat, which industrialists attempted to preserve in the
1930s, produced its own anxieties that preceded the rise of federal intervention in the
southern economy. David L. Carlton, Mill and Town in South Carolina, 1880–1920 (Baton
Rouge: Louisiana State University Press, 1982), 3–5, 6, 9–10. David Goldfield places the
transitional pivot for the true emergence of a “New South” as the Great Depression, although
southern cities continued to be dominated by the values established when cotton fields dom-
inated the region. Still, the Depression and New Deal halted the region’s national conver-
gence, in many respects. David Goldfield, Cotton Fields and Skyscrapers: Southern City and
Region (Baltimore: Johns Hopkins University Press, 1989). In some ways, the SSIC reflected
similar sentiments that prompted the organization of NAM, an organization of “indepen-
dent industrialists … who most successfully translated their dislike for large combinations
into effective antitrust lobbying.” In the 1930s, however, it was cooperation between north-
ern corporations and the federal government at the expense of smaller, regional competitors
that southern industrialists feared. Wiebe, Businessmen and Reform, 14.
5
in national conservative circles the allies that would aid their quest to
promote the South as the nation’s number-one economic opportunity.6
A range of policy battles in the 1930s and 1940s led southern indus-
try’s representatives to promote a revolution in the idea of the South and
its economy. Policy interventions and the nationalization and interna-
tionalization of the southern economy diluted the political salience of an
underdeveloped, misunderstood, and native-born southern population.
Manufacturers thus converted from regional defenders, insistent on a
separate, “infant,” southern economy, to free-marketeers, advocates of
economic liberalism or neoliberalism, as some might call it. In the pro-
cess, they shaped the South’s brand of free enterprise. Southern manu-
facturers became purveyors of free enterprise ideology when they failed
to preserve the region’s separate economy and had to find new leverage
amidst new arrangements in policy and economics.7
Scholars have suggested that neoliberalism had roots in south-
ern planter aristocratic paternalism, marked by devotion to “property
rights, hostility to [the] federal state for other than military purposes,
faith in punitive governance as the key to social order, and enthusiasm
for international trade.” Yet the line from antebellum planters to post-
Reconstruction politics to the Republican Party’s southern strategy
is not so straight. Industrialists’ paternalism emerged gradually from
the 1880s and 1890s as a response to populist challenges from below.
Manufacturers adapted to maintain hold of the social and economic
arrangements of the economy they built to replace the region’s planta-
tion past. Subsequent generations of mill owners, managers, bankers, and
6 Joseph Crespino, “Mississippi as Metaphor: Civil Rights, the South, and the Nation in
the Historical Imagination” in Matthew Lassiter and Joseph Crespino, eds., The Myth of
Southern Exceptionalism (New York: Oxford University Press, 2009). For the New South
industrial elite’s origins, see C. Vann Woodward, Origins of the New South 1877–1913
(Baton Rouge: Louisiana State University Press, 1966); Don Doyle, New Men, New Cities,
New South: Atlanta, Nashville, Charleston, Mobile, 1860–1910 (Chapel Hill: University
of North Carolina Press, 1990); Edward Ayers, The Promise of the New South: Life After
Reconstruction (New York: Oxford University Press, 1992).
7 This book uses “industrialist” and “manufacturer” interchangeably, even as many in
the implied group were allies of, not engaged in, manufacturing. Manufacturers is the
broader term, but the council identified itself as an “industrial” organization, even though
it attracted members from beyond industrial production. SSIC leadership and mem-
bership comprised industrialists, manufacturers of a range of products, as well as the
financial interests, construction companies, retailers, and other business associations that
supported the council. Moreover, “manufacturers” and “industrialist” can be understood
to stand in for the class identity, since these town folk descended from bourgeois mer-
chants, tradesmen, bankers, and mill owners who nurtured industrial capitalism in the
region.
6
manufacturers looked outward, toward the nation. Their conservatism

was not planter traditionalism dressed up in new garb. Instead it devel-
oped out of the mill village during the first three decades of the twenti-
eth century into a modern southern conservatism crafted for industrial
and global capitalism. Industrialists who took this road still shared other
white southerners’ insistence on segregation, but they did so through new
language and new political avenues, with economic priorities very differ-
ent from those of late nineteenth-century Bourbon leaders.8
Unlike the previous generation of “county seat elite,” or “small town
rich men,” whose localism superseded aspirations of cultural advance-
ment and national political power, industrialists in the SSIC sought
regional competitiveness and extensive and networked sources of home-
grown capital, all of which would wield significant policy influence on
Capitol Hill, whether regarding minimum wage legislation, industrial
self-government, collective bargaining, or international trade. While the
SSIC represented a continuous tradition in southern politics of disrupt-
ing “solid” Democratic control, the organization’s influence reflected
deeper changes at work in the southern economy and its place in the
nation. As the Depression and New Deal unfolded, southern manufac-
turers emerged as important, if overlooked, actors in influencing south-
ern politics and economic transformations and in raising the South’s
national significance. They reprised southern business leaders’ flirtation
8 Citing Anthony Harrigan, the SSIC’s spokesman in the 1960s and 1970s, historian Nancy
MacLean notes that “none of the [American] right’s founders and few of its key movement
builders have seen a contradiction between their core catechism of capitalist freedom and
the South’s traditions.” Nancy MacLean, “Southern Dominance in Borrowed Language: The
Regional Origins of American Neoliberalism” in Jane Collins, Michaela di Leonardo, and
Brett Williams, eds., New Landscapes of Inequality: Neoliberalism and the Erosion of
Democracy in America (Santa Fe, NM: School for Advanced Research Press, 2008), 23, 25–
26. Paternalism in the southern context generally denotes the social control implemented by
rural landowners targeting black and white agricultural workers, which extended post–New
Deal amid southern elite’s efforts to block replacements such as Social Security. Lee J. Alston
and Joseph P. Ferrie, Southern Paternalism and the American Welfare State: Economics,
Politics, and Institutions in the South, 1865–1965 (Cambridge: Cambridge University Press,
1999), 2. As historian Randall Patton has established, certain localities differed from the
South’s tendency to look outside for investment and developed innovation locally, as in
the tufted carpet industry in Dalton, GA, which took the form of “indigenous entrepre-
neurship.” SSIC leaders tended to focus myopically on replicating the conditions that had
led to the success of New South industry, which meant putting a premium on public rela-
tions efforts to promote the South’s opportunities. Randall Patton, “Regional Advantage in
the New South: The Creation of North Georgia’s Carpet Industry, 1945–1970” in Phillip
Scranton, The Second Wave: Southern Industrialization from the 1940s to the 1970s
(Athens: University of Georgia Press, 2001), 84–85; Randall Patton, Carpet Capital: The
Rise of a New South Industry (Athens: University of Georgia Press, 1999).
7
with the Republican Party that had occurred with William Howard Taft’s
candidacy and southern Hoovercrats, but this time with more profound
results.9
Although southern manufacturers responded to the New Deal by
retreating to sectionalism, they would continue to redefine the South’s
economy and politics vis- à-
vis the nation. New South industrialists
broke early with the New Deal Democratic coalition and ushered the
regional elite in their shift to the antistatist, business-backed challenge
to bureaucratic growth in the 1930s and 1940s. Southern industrialists
participated in diverse, and sometimes contradictory, networks of right-
leaning pundits, intellectuals, business leaders, and politicians. As busi-
ness leaders participated in funding a host of organizations designed to
promote conservative policy, southern manufacturers strategized how to
find a place in this emerging landscape of political insiders, intellectu-
als, foundations, and lobbying organizations. SSIC leaders, based in the
New South industrial economy, thought they could leverage their alli-
ances with agricultural interests and politicians to sway the New Deal to
serve the continued growth of southern capital by maintaining a uniquely
southern voice.10
9 Tindall notes that “sectional divisiveness” declined following Hoover’s discrediting after
the economic collapse in 1929, but momentarily. The southern “county seat elite,” the
post-Reconstruction “banker-merchant-farmer-lawyer-doctor-governing class,” held
economic and political power across the South. Many historians use the term to refer
to elite planters and merchants, ruling from social standings in counties dominated by
agriculture, an identity and worldview that has little relationship to industry and New
South boosters, who were a generation removed, and had no direct experience with the
Civil War or Reconstruction. Later generations, such as those who made up the SSIC,
had moved in increasingly national circles. George Brown Tindall, The Disruption of the
Solid South (New York: W. W. Norton, 1972), 19, 24, 28, 30. To illustrate the South’s
debut as a major player in the nation’s industrial economy, Tindall cited Edgerton’s elec-
tion as NAM president as a “significant token” of the South’s “industrial emergence,”
tugging “Southern business, as [Woodrow] Wilson had pulled Southern politics, toward
the national orbit.” Tindall, The Emergence of the New South, 71, 618. Scripto, Inc.
executive Rip Blair was a New Deal Democrat, but his company supported the SSIC in
1934, 1935, 1938, and through the later years of World War II. Boosters in Marietta,
GA, exemplified the complicated worldview of southern manufacturers, as they lured
defense-related investment to their locality. Thomas A. Scott, “Winning World War II in
an Atlanta Suburb,” in Scranton, The Second Wave, 2.
Doyle described the New South business elites’ achievements in the “creation of a vast
10
network of towns and cities that had been integrated into a regional and national econ-
omy by rail, steamship and telegraph,” and these achievements “linked their agenda
for economic development to programs for social reform,” including educational and
humanitarian missions characterized by “new paternalism.” Doyle, New Men, New
Cities, New South, 313, 315–16. Howell John Harris, The Right to Manage: Industrial
Relations Policies of American Business in the 1940s (Madison: University of Wisconsin
8
Part I of this book opens with Dixie’s manufacturers mobilizing

to defend a separate regional economy and to work within the early
New Deal as the National Recovery Administration (NRA) attempted
to address the ills of the nation’s industrial economy. As reform pro-
gressed through the National Labor Relations Act of 1935 (NLRA),
southern manufacturers grew increasingly restive in a political coalition
that appeared to target the South’s competitive advantage and labor-
management relations and threatened to upend the region’s social and
racial hierarchies. Manufacturers’ failures in the 1930s to modify the
New Deal to their liking led these men to seek political allies to preserve
existing industries as well as to promote homegrown capital and outside
investment. These failures also led southern industrialists to reconcile
their Jeffersonian impulses with modern free market economics and the
language embraced by business conservatives to challenge the New Deal.
Their responses to the Fair Labor Standards Act of 1938 (FLSA), freight
rate revision, and World War II mobilization yielded a southern conser-
vatism infused with the language of free enterprise, in which the South
emerged as the Nation’s No. 1 Economic Opportunity.11
Part II examines the SSIC’s efforts to undermine what the organiza-
tion deemed bureaucratic overreach and protect “southern” interests
via national alliances. Through activism regarding the Fair Employment
Practices Commission (FEPC), postwar labor reform, and Congress of
Industrial Organizations (CIO) organizing in the region, the council
became a lobbying group that consciously connected previously explic-
itly southern concerns to the modern conservative movement. SSIC lead-
ers sought a conservative leader and party, promoting the candidacy
of third-party, and eventually Republican, candidates while continuing
Press, 1982), 185–198. The SSIC participated in business efforts to convert the American
public, and workers in particular, to free enterprise complementing business leaders’
efforts to foster the growth and success of the conservative movement. Phillips-Fein,
Invisible Hands. Southern manufacturers moved between libertarianism and tradition-
alism. Although they rarely used these terms, they were avowedly conservative, con-
tributing to the notion that conservatives offered an “ideology that was largely hidden
from view as it developed.” Manufacturers had to reconcile their southern worldview
with economic self-interest. Jennifer Burns, “Review: In Retrospect: George Nash’s ‘The
Conservative Intellectual Movement in America since 1945’” Reviews in American
History 32, no. 3 (September 2004), 459.
The Southern Governors’ Council was another organ for this booster message, but
11
business leaders had specific quarrels with the kinds of policies the governors advo-
cated to lure investment. See Southern Governors Conference Records (1939–1943) in
Frank M. Dixon Gubernatorial Papers, Alabama Department of History and Archives,
Montgomery, AL.
9
to advocate for federal economic policies that would benefit southern

manufacturers –a group that also evolved as the southern economy diver-
sified in the post–World War II era, a process driven by non-commodities-
intensive industries. Southern manufacturers crafted a practical, political
rhetoric that connected the language of free enterprise to the needs of
the southern economy, joined networks of conservatives, including tra-
ditionalists, and ushered the South’s industrial elite into the conservative
movement in the 1950s.12
The SSIC’s efforts were both productive and futile: southern boost-
ers and business leaders gained greater coherence in their branding of
their region, and they modernized southern conservatism in ways that
garnered allies in the national movement. Reliance on the language of
free enterprise diminished the SSIC’s core mission of regional protec-
tionism but expanded and diversified its support network. Many mem-
bers remained personally progressive, confronting entrenched political
machines at the local and state levels and favoring a two-party South.
Being for industrial growth, they were wary of labor legislation and an
expansive welfare state. At the same time, the SSIC and southern con-
servatives tied the national movement to the South’s politics of white
supremacy and defense of segregation. This commitment continued as a
“second wave” of industrialization contributed to cultural dislocations
in the South, and southern industrialists attempted to carve out a place
within these changes. In the process, southern business leaders supported
southern politicians such as Strom Thurmond, who would embrace the
SSIC’s members’ view of free markets, antiunion politics, and states’
rights.13
The South’s traditionalists, particularly the intellectual spokesmen among them

12
who revered the South’s agrarian past, tended to criticize capitalism and therefore to
remain “superfluous” to the conservative movement. John J. Langdale, III, Superfluous
Southerners: Cultural Conservatism and the South, 1920–1990 (Columbia: University of
Missouri Press, 2012). David C. Perry and Alfred J. Watkins refer to six pillars of Sunbelt
growth: “agriculture, defense, advanced technology, oil and natural gas, real estate and
construction, and tourism and leisure.” See discussion of Perry and Watkins in the con-
text of Sunbelt scholarship in Nickerson and Dochuck, Sunbelt Rising, 7. David C. Perry
and Alfred J. Watkins, eds., The Rise of Sunbelt Cities (Beverly Hills, CA: Sage, 1977).
13 Schulman, From Cotton Belt to Sunbelt, ix. Southern conservatives’ reactions to the New
Deal are well established in political history, but most historians have focused on the failure
of liberalism in the region, or on congressional opposition, rather than on southern indus-
trialists specifically. Roger Biles, The South and the New Deal (Lexington: University Press
of Kentucky, 1994); Patricia Sullivan, Days of Hope: Race and Democracy in the New Deal
Era (Chapel Hill: University of North Carolina Press, 1996); Anthony J. Badger, North
Carolina and the New Deal (Raleigh: North Carolina Department of Cultural Resources,
Division of Archives and History, 1981); Ira Katznelson, Fear Itself: The New Deal and the
01
Understanding the SSIC’s activism completes the story that C. Vann
Woodward told the first part of: the story of new men of the New South,
which had been in the making since the end of Reconstruction. SSIC lead-
ers built on previous entrepreneurs’ quest for an industrial, modern South,
using familiar depictions of the South’s industrial economy. The region’s
industry was small-scale and underdeveloped; the workers were untrained
and lacked industrial backgrounds, having recently moved from fields to
factories; the climate was hot and the roads unpaved; the railroads were
expensive; the region was rich in raw materials but low in human capi-
tal. Modernizers claimed to build industry to aid regional development,
provide work for the agricultural poor, draw investment to and build cap-
ital sources within the region, and erect Dixie’s industrial base. Having
survived populist challenges to modernity, an industrial social order and
“town” people helped guide the South’s economic development.14
This strategy of depicting the South and its economy as developing
seemed to be working by the 1920s, when northern textile firms increased
their investment in southern plants. Firms moved spindles southward in
greater numbers, and by the decade’s end the South boasted more spin-
dles than the North. Dixie’s mills specialized in coarse products and grey
goods; finer, high value-added textiles tended to remain a northern spe-
cialty. Innovation stayed north of the Mason-Dixon line, as well. Textile
machines, imported from Massachusetts, whirred in southern Piedmont
mills; the gray goods often produced at such establishments headed north
to be processed and finished into finer, market-bound products.15
Origins of Our Time (New York: Liveright Publishing Corporation, 2013) establish the
limitations liberals faced in challenging conservative control of New Deal funds at the state
and local levels and alleviating the cycle of low wages and poverty. For business and the con-
servative movement, see Phillips-Fein, Invisible Hands; Joseph Crespino, Strom Thurmond’s
America (New York: MacMillan, 2012); Moreton, To Serve God and Wal-Mart, 205.
14 Woodward, Origins of the New South, 319. Carlton, Mill and Town in South Carolina,
270– 272. The benevolent image modernizers and capitalists crafted of themselves
did not go unchallenged, as documented by southern labor historians in particular.
On southern labor movements, see F. Ray Marshall, Labor in the South (Cambridge,
MA: Harvard University Press, 1967); Gary Fink, Race, Class, and Community in
Southern Labor History (Tuscaloosa: University of Alabama Press, 1994); Janet Irons,
Testing the New Deal: The General Textile Strike of 1934 in the American South
(Urbana-Champaign: University of Illinois Press, 2000); John Salmond, The General
Textile Strike of 1934: From Maine to Alabama (Columbia: University of Missouri Press,
2002); Clifford M. Kuhn, Contesting the New South Order: The 1914–1915 Strike at
Atlanta’s Fulton Mills (Chapel Hill: University of North Carolina Press, 2001).
15 David Koistinen, “The Causes of Deindustrialization: The Migration of the Cotton
Textile Industry from New England to the South,” Enterprise and Society 3 (September
2002). Historians have weighed the influence of location theory, relating to cost of
1
The SSIC straddled two different “New Souths,” the first dating from
the post-Reconstruction era, the second from the post–World War II
emergence of the Sunbelt, as suburbanization and international compe-
tition transformed the region yet again. In the 1950s, the South experi-
enced declines in manufacturing similar to those the North had seen in
the 1920s, as ongoing movements in industrial capitalism, particularly as
regards the cotton textile industry, reached the South. Yet defense-related
research and production, and the location of military bases, invigorated
specific areas, such as Huntsville and Houston, leading to a more diverse
southern economy. The SSIC’s membership in the 1950s mirrored the
shifting industrial landscape. New South commodity- based industries
remained central to the organization, but the changing distribution of
SSIC member firms over time reveals the alliances between New South
industrialists and national corporate interests investing in the South. In
the twenty-first century, the global South competes on the basis of cheap
labor for commodities-intensive industrial production.16
production and access to markets, and social and political assumptions of owners in the
movement of spindles southward, in addition to the role played by technological innova-
tion in the industry and rising global competition. See Alice Galenson, The Migration of
the Cotton Textile Industry (New York: Garland, 1985); Nancy Frances Kane, Textiles in
Transition, Technology, Wages, and Industry Relocation in the U.S. Textile Industry, 1880–
1930 (Westport, CT: Greenwood Press, 1988); Beth English, A Common Thread: Labor,
Politics, and Capital Mobility in the Textile Industry (Athens: University of Georgia Press,
2006); Timothy Minchin, Empty Mills: The Fight against Imports and the Decline of
the U.S. Textile Industry (Lanham, MD: Rowman & Littlefield Publishers, 2013); Sven
Beckert, Empire of Cotton: A Global History (New York: Alfred A. Knopf, 2014).
The South has been a “sphinx” on the land, as described by historian David Potter. David
16
M. Potter, “The Enigma of the South,” in Potter, The South and Sectional Conflict (Baton
Rouge: Louisiana State University Press, 1968). See also Michael O’Brien, The Idea of
the American South, 1920–1941 (Baltimore: Johns Hopkins University Press, 1979).
Numan Bartley named the period of 1945 to 1980 “the New South.” Bartley’s dynamic,
flexible, and modern New South was the Sunbelt –conservative, but where desire for
economic progress mitigated backward responses to desegregation and moderates val-
ued modernization over white supremacy. Although the region’s new suburbanites in the
1970s were “more provincial, more religious, and more conservative,” they shopped at
the same chain stores, watched the same programs on television, and “even voted for
politicians who were as bland as those elsewhere.” Numan V. Bartley, The New South,
1945–1980 (Baton Rouge: Louisiana State University Press, 1995), xxi, 449; Beckert,
Empire of Cotton, 396, 429; James Cobb and William Stueck, eds., Globalization and
the American South (Athens: University of Georgia Press, 2005); Maunula, Guten Tag,
Y’all. Wright, “Afterword” in Scranton, The Second Wave, 286. Southern agriculture and
plantations also experienced a revolution in the 1930s and 1940s, which “convulsed”
the region, gutting the sharecropping system and contributing to further migration and
mechanization. Jack Temple Kirby, Rural Worlds Lost: The American South, 1920–1960
(Baton Rouge: Louisiana State University Press, 1987), 52–53.
21
The SSIC also straddled two eras of southern politics. The tepid
progressivism of mill managers of the early twentieth century gave way to
an embrace of modern conservatism following World War II. Prompted
by the New Deal to resolve the ongoing conflict between, as historian
William A. Link put it, “the paternalism of reformers and the localism
and community power of traditionalists,” southern industrialists turned
to the language of free enterprise. In so doing, business leaders helped
reshape the politics of the New South into the politics of the Sunbelt.
As mill-village paternalism declined, southern manufacturers neverthe-
less maintained their mission to retain low wages but redefined southern
interests away from the defense of traditional social hierarchy toward the
prevention of bureaucratic involvement in the region’s economic affairs.
Even as traditional southern industries became a less dynamic part of the
southern economy, eclipsed in attention by the booming Sunbelt defense
industry, which emerged between 1945 and 1960, the ideas that southern
industrialists promoted remained central to Dixie’s economic identity.17
Between the 1930s and the 1970s, the SSIC evolved from a regional
offshoot of NAM into a powerful political lobbying group for south-
ern business and then into the United States Business and Industrial
Council (USBIC), a manufacturers’ association representing the interests
of small and medium-sized firms nationally. Because of the organization’s
regional roots and identity, a form of protectionism existed at the center
of the SSIC’s activism throughout its history. In the 1930s, manufactur-
ers worked within the New Deal, despite their criticisms of it, to guard
what they argued were the South’s fledgling industries, which had grown,
unlike the North’s, without the benefit of tariffs. While maintaining this
focus on competitive advantage, SSIC leaders later downplayed notions
of a deficient South and increasingly depicted the region as a haven for
17 William Link, The Paradox of Southern Progressivism, 1880– 1930 (Chapel Hill:
University of North Carolina Press, 1992), xii; V. O. Key, Southern Politics in State
and Nation (New York: Alfred A. Knopf, 1949); Joseph Crespino, “Strom Thurmond’s
Sunbelt: Rethinking Regional Politics and the Rise of the Right,” in Nickerson and
Dochuk, Sunbelt Rising, 61. For the transformation of racial politics, with specific ref-
erence to the SSIC, see Jason Morgan Ward, Defending White Democracy: The Making
of a Segregationist Movement and the Remaking of Racial Politics, 1936–1965 (Chapel
Hill: University of North Carolina Press, 2011). On the shift from white supremacy to
segregationist politics, see Lassiter and Crespino, The Myth of Southern Exceptionalism,
9; Carlton, Mill and Town in South Carolina, 6, 109–110, 225. For the merging of evan-
gelical Christianity and free enterprise as it relates to the Sunbelt, see Darren Dochuk,
From Bible Belt to Sunbelt: Plain-Folk Religion, Grassroots Politics, and the Rise of
Evangelical Conservatism (New York: W. W. Norton & Company, 2010).
3 1
free enterprise –the nation’s best economic opportunity, not anymore its

chief “economic problem.”18
In the 1940s, New South industrialists promoted the South’s “business
climate,” touting the region as an attractive place for investment, defined
by low taxes, lenient regulation, cheap labor, and state and local invest-
ment in infrastructure and human capital. Yet achieving widespread
acceptance of the politically useful definition of region that the SSIC pro-
moted proved a hollow victory. Southern industrialists’ identity and class
consciousness, which had defined these men’s response to the New Deal,
no longer dominated. The commodities-oriented industrial economy of
the New South declined, although the region continued to attract mature
industries and cycles of capital movement.
Defense spending in the region did not catalyze a reprised wave of
industrialization. Outside of specific areas receiving infrastructure and
defense-related investment, defense spending in the region was unsettled,
illustrated by the rise and subsequent ebb in contracts during and after
the Vietnam War. It was not defense spending that fueled the revolutions
in the southern economy that the SSIC confronted. Rather, they grew
from the nationalization, globalization, and diversification of Dixie’s
industrial base. Companies that had formed the SSIC’s core membership
disappeared amid international competition, mergers and buyouts by
national and international firms, and loss of market share.19
Nickerson and Dochuk, Sunbelt Rising, 16. Recent scholars have attempted to define as
18
well as complicate the idea of the Sunbelt, a political and economic concept that emerged
in the late 1960s. Kevin P. Phillips, The Emerging Republican Majority (New Rochelle,
NY: Arlington House, 1969); Kirkpatrick Sale, Power Shift: The Rise of the Southern
Rim and Its Challenge to the Eastern Establishment (New York: Random House, 1975).
Bruce Schulman argues that federal involvement in the region helped new Whigs gain
power, referring to the political class that replaced the Black Belt elite. This group cer-
tainly included many SSIC members as the organization transformed from representing
older style New South industries to more diversified interests, but they remained wary
of the uneven distribution of federal largesse and infrastructure investment. Schulman,
From Cotton Belt to Sunbelt. Elizabeth Tandy Shermer explains how local boosters in
the Sunbelt shifted from the idea of “buying payroll” to promoting a beneficial “business
climate.” Elizabeth Tandy Shermer, Sunbelt Capitalism: Phoenix and the Transformation
of American Politics (Philadelphia: University of Pennsylvania Press, 2013), 147–148.
David L. Carlton, “The American South and the U.S. Defense Economy” in Carlton
19
and Coclanis, eds., The South, the Nation, and the World, 159–162. The rise of the
Sunbelt led to several discussions regarding the nature of interregional conflict in the
1970s, yet unlike the 1930s, the balance seemed more favorable to the South and Sunbelt
when it came to economic growth and opportunity. Raymond A. Mohl, Searching for
the Sunbelt: Historical Perspectives on a Region (Knoxville: University of Tennessee
Press, 1990).
41
The SSIC thus reflected the southern business class’ efforts to adapt to
altering economic patterns and to redefine the region and economy as the
South converged with managerial capitalism and underwent an agricultural
revolution in the mid-twentieth century. SSIC leaders’ depiction of the South
as a free market haven belied a more complex story of capital flight, local
boosterism, and changing market and regulatory structures that shaped the
South’s transformations. Despite southern governors’ and regional boosters’
triumphant narratives about the growth of the region’s industry, in reality
the industrial base diversified away from traditional New South commod-
ity-intensive industries, though incomes derived from manufacturing in the
region still depended on churning out low-value added products for sale in
largely unprotected markets, much like the agricultural commodities pro-
duced in the late nineteenth century. The SSIC helped shape the idea of the
Sunbelt, but many prominent SSIC members failed to maintain their places
in the turbulent southern economy, while others, such as Monsanto and
Milliken & Co., grew into multinational corporations.20
In the 1960s, SSIC leaders continued to protect and promote specific
industrial interests, although in a different iteration than in the 1930s.
Amid rising international competition that undermined traditional New
South industries’ competitiveness, SSIC leaders redefined their mission as
advocating for small and medium-sized manufacturers under assault from
competition abroad. As the group relinquished its sectionally based argu-
ments, leaders renamed the SSIC the USBIC in the early 1970s. Financial
support surfaced from South Carolina textile manufacturer and conser-
vative philanthropist Roger Milliken, and the USBIC continued –despite
it free market rhetoric –to advocate for limitations on international trade
and tariff protection for American industries.21
The southern economy has been distinctive, defined by its labor pool, market access, raw
20
material availability, and infrastructure. Gavin Wright argues that the South’s economy
“was a particular configuration that derived its identity through its interaction with
national and international economies in particular epochs” and its labor market set it
apart. Gavin Wright, Old South, New South: Revolutions in the Southern Economy
Since the Civil War (New York: Basic Books, 1986), 4, 7.
“About Us,” USBIC, www.americaneconomicalert.org/aboutus.asp; Alan Tonelson, The
21
Race to the Bottom: Why a Worldwide Worker Surplus and Uncontrolled Free Trade Are
Sinking American Living Standards (Boulder, CO: Westview Press, 2000). For the devel-
opment of national business organizations that represented large corporate interests, see
Benjamin C. Waterhouse, Lobbying America: The Politics of Business from Nixon to
NAFTA (Princeton, NJ: Princeton University Press, 2014). Other organizations had also
emerged to promote free enterprise; see Moreton, To Serve God and Wal-Mart, 146–148.
The SSIC had already become a narrowly focused organization. Its protectionist trade
5 1
The USBIC also continued to work with the conservative movement

and the New Right. Anthony Harrigan, who frequently contributed to
National Review and other prominent conservative and mainstream pub-
lications, took the organization’s helm in the early 1970s and found a
niche among other national organizations. The USBIC developed an iden-
tity primarily as a conservative critic of trade policy, but it also criticized
federal regulatory expansion and, in the 1980s, affirmative action to pro-
mote racial equality. The early twenty-first-century version of the organi-
zation supported research by Alan Tonelson that critiqued international
free trade agreements such as the North Atlantic Free Trade Agreement
(NAFTA), but the organization maintains no specific link to the South.22
Southern exceptionalism may be a myth that obscures the nation’s cul-
pability in perpetuating racial inequality and lack of opportunity. Often,
the boundaries of regional history artificially divide the country and erro-
neously assign innocence and accountability in the perpetuation of struc-
tural inequalities and racial discrimination. Yet contests over definitions
of region –including the SSIC’s waning emphasis on a separate South –
provide a lens for understanding how politically motivated groups, in
this case business leaders, understood, articulated, and redefined their
interests as the federal government expanded and rising global competi-
tion and capital flight reshaped the South’s economy. Region and market
orientation are important categories in the analysis of business’ participa-
tion in conservative organizing from the mid-twentieth century.23
policy advocacy distanced it from mainstream business organizations, which tend to

favor global free trade. Paul Krugman traced Milliken’s support for protectionist groups,
including the USBIC, writing, “Milliken is the most important contributor to the United
States Business and Industrial Council, a lobbying group that was originally formed to
oppose the New Deal but which in recent years has devoted its energies to opposing
free trade.” Krugman suggests that the group influenced Pat Buchanan’s politics and
protectionism. Paul Krugman, “Who’s Buying Whom?: The Milliken Man March on
Washington” Slate, September 26, 1997, www.slate.com/articles/business/the_dismal_
science/1997/09/whos_buying_whom.html.
Nicholas Laham, The Reagan Presidency and the Politics of Race: In Pursuit of
22
Colorblind Justice and Limited Government (Westport, CT: Praeger, 1998), 98. After
Milliken’s death in 2010, Milliken & Co. ceased its support for protectionist trade pol-
icy. Bob Davis, “How a U.S. Textile Maker Came to Embrace Free Trade” Wall Street
Journal, May 4, 2015.
Stephen Prince, Stories of the South: Race and the Reconstruction of Southern
23
Identity, 1865–1915 (Chapel Hill: University of North Carolina Press, 2014); Richard

Franklin Bensel, Sectionalism and American Political Development, 1880– 1980
(Madison: University of Wisconsin Press, 1984); Lassiter and Crespino, The Myth of
Southern Exceptionalism; Byron E. Shafer and Richard Johnston, The End of Southern
61
Still, regional identities are fluid. The SSIC’s definition of what states
constituted the South changed over time. Initially, the SSIC represented
the “thirteen southern states.” By the end of the 1930s the “South”
expanded to fifteen states, and then sixteen. Oklahoma, West Virginia,
and Maryland were the latecomers, added to the eleven states of the
Confederacy, Kentucky, and Missouri. Such additions occurred almost
thoughtlessly, without acknowledgment that the idea of a fixed, sepa-
rate South was unraveling. Because the SSIC membership depended on
voluntary dues rather than regular subscriptions, donations fluctuated
with political issues that dominated national politics as well as with
the fortunes of specific industries and areas. Simultaneously, changes in
membership yield a historians’ boon: shifting origins of support reveal
subregions and sectors where SSIC activism was appreciated and the
changing intraregional and economic dynamics that informed the coun-
cil’s activity.24
The Americanization of Dixie that observers would chronicle in the
1970s depended more than many knew on the groundwork laid by
the SSIC and its efforts to equate the South with free enterprise and
opportunity. Dixie did not just become Americanized and vice versa;
the economic structures and ideas on which it had existed as a separate
region had been undermined. Free enterprise rhetoric replaced defenses
of mill village paternalism and facilitated the redefinition of the South’s
economy from colonial, backward, and underdeveloped into the Sunbelt
“business climate.” John Egerton observed in 1974 that “the South can-
not survive without industrialization –and may not survive with it.” The
destabilizing effects of the “new carpetbaggers,” building new corporate
centers and investing in real estate, had been unleashed on the region,
Exceptionalism: Class, Race, and Partisan Change in the Postwar South (Cambridge,
MA: Harvard University Press, 2006); Joseph Lowndes, From the New Deal to the New
Right: Race and the Southern Origins of Modern Conservatism (New Haven, CT: Yale
University Press, 2008). The Sunbelt has emerged as a “culturally defined place” within
“the nation’s collective imagination.” Southern business leaders played a role in crafting
this definition. As a region on the industrial frontier, defined by its economic deficiencies,
business leaders undertook the task of remaking this regional identity into a positive,
into an opportunity for the nation, yielding the Sunbelt “as a political-economic space
and an imagined modern place” that includes the South alongside the Southwest and
West. Nickerson and Dochuk, Sunbelt Rising, 4–18.
SSIC Account Books, SSIC Oversized Items, Papers of the Southern States Industrial
24
Council Records (1933–1973), Tennessee State Library and Archives (hereafter cited as
SSIC Papers). All documents courtesy of the Tennessee State Library and Archives.
7 1
prompted by the redefinition of the South’s economy and promotion

of its beneficial business climate. The region’s core industrial leaders,
ironically, by seeking to promote the growth of southern capital, set in
motion a process that would aid in the death of the economic identity
they had seen as the foundation of a modernizing, prosperous Dixie.25
25 Kim Phillips-Fein, “Conservatism: A State of the Field,” Journal of American History, 98,

no. 3 (December 2011), 742; Matthew Lassiter, “Political History Beyond the Red-Blue
Divide,” Journal of American History, 98, no. 3 (December 2011), 761; Egerton, The
Americanization of Dixie, 108.
81

91
Part I
WORKING WITHIN THE NEW DEAL
We’ve hocked our Sunday pants to please the NRA,

but if this ends our peeling off we have no word to say.
If we should tell you of our griefs we could a tale unfold
that would fade Job clean off the lot and leave the half untold.
Our bank went bang right in our face and called our notes when due
and when we urged that others pay we found their banks broke too.
We figured work most every day so close we fared to win
and found some dear competitor could make us look like sin.
The folks that once sent orders in now have no word to say,
but that darned fellow, Please Remit, writes to us every day.
–J.D. Sargent, North Carolina Granite Company to Sen. Josiah
Bailey, December 25, 1933. Josiah Bailey Papers 108.
19
02
1 2
The New South and the NRA
In July 1933, shortly after Congress passed the National Industrial Recovery
Act (NIRA), national headlines heralded the cotton textile industry for coop-
erating to ban child labor and for raising wages by as much as 30 percent
and cutting hours by 25 percent. The NRA permitted businesses, trade orga-
nizations, and labor representatives to confer and agree on industry-specific
wages, rates, and minimum prices for each industrial sector, practices that
antitrust laws passed during the Progressive Era had previously prohib-
ited. Steelworkers would have their own wage, as would textile workers,
lumber cutters, miners, and so on. Some codes, such as for textiles, allowed
wage differentials based on region. Cooperating firms could display a Blue
Eagle symbol, an advertisement that the business engaged in fair practices.
Enforcement also took place within the code authority, which trade associ-
ations often controlled, with a goal of curtailing competition and regulating
production, both long-standing goals of industrial and trade associations.
For textile manufacturers, a “sick” industry beset by destructive competition,
the NRA offered a respite, higher profits, and a renewed public image.1
1 “President Signs the Textile Code; First Major Pact.” New York Times, 10 July 1933. The
Supreme Court ruled several times on the practices of trade associations and sharing of
statistical reporting among member firms. A series of decisions in the mid-1920s reversed
past precedent, and, “By 1925, then, the business community had a fairly clear view of
the boundary line separating lawful from unlawful trade association activity. If the infor-
mation was past-rather than future-oriented, was presented as aggregate-, industry-wide
data rather than just to association members and, above all else, made no effort to recom-
mend future pricing or production decisions to industry members, the reporting system
would likely meet with Court approval.” However, as Shaffer notes, addressing declining
prices and maintaining competitive stability remained difficult. Still, business leaders pre-
ferred collectivist approaches to obtaining stability and were open to working with state
21
2
22 The New South and the NRA
The NRA provided stability to the cotton textile industry and other
sectors struggling amid spiraling wages and prices. Prices rose and plan-
ning for future production became more predictable. For low- wage
industries, in particular, the NRA raised wages to a significant degree,
in some cases as much as 60 percent, although total increases varied by
industrial sector. Overall, the NRA narrowed the divide between north-
ern and southern wages, which had been historically divergent but had
widened during the depression. But the spirit of cooperation that the
press celebrated was not without challenge.2
The SSIC emerged by December of 1933, just six months after the law
went into effect, and the organization’s genesis had roots in the specific
concerns raised by southern manufacturers as the NRA went into effect.
Many feared that northern competitors would use their influence in the
Roosevelt administration to stamp out southern competition, particu-
larly in textiles. Their organization, the SSIC, would voice the “southern
industrial position” to members of Congress and the administration and
act as a collective regional voice to augment the position of what often
were weaker southern-based trade associations, if Dixie’s industries had
a voice at all. Criticisms from southern manufacturers emerged gradually
and were not a knee-jerk, conservative response to the New Deal. As
this chapter explains, southern manufacturers sought to use the NRA to
achieve long-standing goals, despite their worries that the codes disad-
vantaged the South.
In founding the SSIC, Dixie’s industrialists hoped to modify the NRA
to suit their needs. Manufacturers mobilized to prevent further erosion of
the South’s separate wage structures; to reduce hypercompetition and spi-
raling prices and wages, which had plagued their low-wage, commodities-
intensive industries; and to prevent the unification of the South’s labor
market with the nation’s. They wanted to limit wage and hour regulations
while also preserving industrial self-government under the law. This polit-
ical agenda required a deft approach. To build a campaign on behalf of
southern industry, manufacturers relied on the power of southern congres-
sional leaders to secure greater representation for southern manufacturers
machinery. The NIRA allowed wider sharing of future pricing and production informa-
tion. Butler Shaffer, In Restraint of Trade: The Business Campaign Against Competition,
1918–1938 (Lewisburg: Bucknell University Press, 1997) 21–25; 75–76, 105–109.
2 Wright, Old South, New South, 216–217; Shaffer, In Restraint of Trade, 106–107; Eric
Rauchway, “Reflation and Recovery in the 1930s and their Implications for the 2000s”
in Bruce Schulman, ed., Making the American Century: Essays on the Political Culture of
Twentieth Century America (New York: Oxford University Press, 2014), 219–220.
3 2
The New South and the NRA 23
on code boards and thereby preserve and advance wage differentials.

Dixie’s industrialists needed to consolidate power across sectors and
couch their message in language that would win them allies among south-
ern representatives, whose electoral success depended on southern labor, a
constituency that strongly favored the New Deal.3
Suspicion of outsiders and northern competitors’ influence in the NRA
stirred southern manufacturers’ NRA critiques and their formation of the
SSIC. But those suspicions grew from deeper convictions that moderniza-
tion in the South should be directed by local elites who could preserve
the South’s social and cultural values and industrial future. Maintaining
social control of labor, a power that preserved low industrial wages, was
these elites’ core priority in their attempts to modify the New Deal. To
achieve this end, southern manufacturers amplified the popular myth of
the New South boosters of the previous century. In their eyes, they, or
their fathers and grandfathers, had brought industry to the region to pro-
vide improvement and alleviate poverty and ignorance, and to provide
the region with homegrown capital. They would continue to guide the
region if they could maintain control of labor and influence state and
local incentives for investment, remaining free from outside interference.
Yet, given the troubled nature of southern industries and the poor sta-
tus of business leaders, these self-proclaimed representatives of southern
manufacturing settled for working within the president’s proposed pro-
grams, even if they resented meddling administrators’ attempts to remake
the southern economy. At the same time, the SSIC developed a defensive
rhetoric about the South and its economic needs that set Dixie’s manufac-
turing sector apart from the nation’s.4
3 Wright, Old South, New South, 199, 223. Ellis Hawley explains that, above all, business
leaders sought to use the machinery of government to curb destructive competition, but
regional tensions related to wage differences factored into the difficulties of associational
solutions to economic depression from the start. Hawley, The New Deal and the Problem
of Monopoly, 27, 222. See also Louis Galambos, Competition & Cooperation: the
Emergence of a National Trade Association (Baltimore: Johns Hopkins Press, 1966);
Louis Galambos and Joseph A. Pratt, The Rise of the Corporate Commonwealth: U.S.
Business and Public Policy in the Twentieth Century (New York: Basic Books, 1988);
Robert Sobel, The Age of Giant Corporations: a Microeconomic History of American
Business, 1914–1970 (Westport, CT: Greenwood Press, 1972).
4 The SSIC represented, as James Cobb explained, the “power structure reflecting the
interests of what [Atlanta Constitution editor] Ralph McGill described as the ‘small
town rich man.’ ” James Cobb, Industrialization and Southern Society, 1877– 1984
(Lexington: University Press of Kentucky, 1984) 149. Modernization is distinct from
development, although southern industrialists often used the terms interchangeably,
a fact stemming from the unevenness of the southern economy. Jack Temple Kirby
42
The Southern Textile Industry

in the Depression
During the depths of the Depression in 1931 and 1932, politicians,
newspaper editors, and commentators excoriated business, particularly
big business, for causing the Great Depression. Critics cited business
leaders’ greed as central to the economic collapse. Politicians who had
strong ties to business circles, particularly Herbert Hoover, received criti-
cism for falling prey to business’s commitment to laissez-faire economics
and failing to achieve recovery. Business leaders, critics charged, offered
no helpful solutions to the crisis, even as the Roosevelt administration
crafted the NRA and its cartelization of industry to woo business sup-
port. Smaller southern manufacturers did not escape the finger of blame.
The troubles of the cotton textile industry, the region’s most prominent
industry, also explains the public relations problem that southern manu-
facturers faced when they raised criticisms of the NRA, a program that
sought to stabilize troubled industries.5
Although cotton textile manufacturers across the country had taken
voluntary steps to curb night work and other cost-cutting strategies that
exacerbated overproduction and hypercompetition in the late 1920s, a
glut of goods still plagued the industry. The number of spindles in oper-
ation decreased, but overtime work and the “stretch-out” –a term for
scientific management mechanisms to achieve more output per man-hour
and reduce costs –continued, and noticeably so in the South. The stretch-
out helped incite a wave of textile strikes in 1929, but workers had little
explains, “Development … is a set of ideal social goals … it aims to feed everyone;

to eliminate unemployment, poverty, inequality; and to secure political and economic
independence. Modernization, on the other hand, has often widened class and income
inequities, fixed many people in unemployed poverty, and bred economic and political
colonialism.” Kirby generalized that “roughly between 1920 and 1960 the American
South was modernized; it was not developed.” Kirby, Rural Worlds Lost, 119. Daniel
Immerwahr defines modernization as a “political vision: the desire to achieve a partic-
ular social configuration in which institutions are oriented toward industry, governed
by urban norms, shaped by bureaucratic practices, and centralized to a certain degree,”
and he situates modernization within development, which does not necessarily entail
the centralization of institutions. Daniel Immerwahr, Thinking Small: The United States
and the Lure of Community Development (Cambridge, MA: Harvard University Press,
2015) ix–x.
5 One example of such a headline came from the New York Times, which reported pro-
gressive Republican Senator Hiram Johnson of California calling for Roosevelt’s election
in the 1932, “ ‘Divine Right of Business to Exploit’ Must Be Ended.” New York Times, 5
November 1932.
5 2
The Southern Textile Industry in the Depression 25
power or organizational backing to challenge mill owners, who often met

labor protests with violent reprisals.6
Southern manufacturers cited several reasons for the persistence of such
practices. For the mills that had already closed or dramatically reduced
production, scarce capital and credit meant that increased demand for cot-
ton goods such as household towels, sheeting, or undergarments would
prove difficult, if not impossible, to meet. At the same time, plants needed
to produce enough goods to meet payroll. Workers, already struggling to
make ends meet on lower wages, manufacturers argued, would find it dif-
ficult to get enough work to survive if managers cut back hours. As the
woes of the “sick” textile industry made national headlines in 1932, many
southern workers were taking home wages of less than twenty cents an
hour. Perpetually deficient per capita income in the South regressed toward
Reconstruction-era levels, falling back to 55 percent of the national aver-
age as the Depression deepened. The paltry incomes of southern workers
offered evidence of business greed.7
Southern manufacturing had been growing for decades, but the method
of its growth was controversial. Northern mills resented competition
from the region’s low-wage labor and competitive practices. In the 1920s,
many northern textile firms migrated southwards or invested in mills in
the region, and by the end of the decade the majority of the nation’s spin-
dles operated south of the Mason-Dixon Line. In 1925, New England
manufacturers and all six governors formed the New England Council
to adapt to competition from the “warmer temperatures and cheaper
costs” that led to the exodus of many plants out of the region. Even
though many northern firms invested in southern plants in the 1920s,
the region’s low wages degraded prices, particularly with rising interna-
tional competition. In short, the rise of southern spindles threatened the
6 Thomas Ferguson, “The Coming of the New Deal” in Steve Fraser and Gary Gerstle,
eds., The Rise and Fall of the New Deal Order, 1930–1980 (Princeton, NJ: Princeton
University Press, 1989), 17. Economic historians name the textile industry as one of
the shrinking industries as demand shifted to goods defined by “affluent consump-
tion” and goods such as processed foods eclipsed raw material demands for textiles
and lumber. Michael A. Bernstein, “Why the Great Depression Was Great: Toward
a New Understanding of the Interwar Economic Crisis in the United States” in
Ibid., 36–37.
7 “Average Hour Wage Rates Paid Common Labor,” Statistical Abstract of the United
States, 1933, 55th Number, United States Department of Commerce, (Washington,
DC: Government Printing Office, 1933), 299. Per capita income was above the 1880 level
of 51 percent, and Cobb notes that it has risen to 62 percent by 1920, then decreased
again. Cobb, Industrialization and Southern Society, 36.
62
stability of “restrictive and cartelization efforts of the dominant firms in

the industry.”8
In March 1932, the Cotton Textile Institute (CTI), a textile manu-
facturers’ organization that had formed in 1926 to confront destructive
competition, convened to address the ongoing crisis in the sector. The
CTI’s president, George Sloan, declared that capacity reductions would
raise prices and thereby increase wages. Yet without the possibility of
stronger enforcement of fair competition, Sloan could offer only hopeful
predictions. Overproduction continued, and southern workers churned
out cotton goods that further deflated prices. Textile unemployment
reached close to 40 percent in northern mills, which had long been pro-
testing the upstart competition from cutthroat southern establishments.
In the South, as labor found common voice to protest working conditions
and demand better pay and more humane hours, the poor states of life
and work in mill villages continued to be a public-relations disaster and
the source of labor unrest.9
For southern textile workers in the 1920s, although capacity expanded
in response to increased demand following the Great War, their ability to
make a decent living did not expand apace. While output rose by as much
as 50 percent –a result of efficient machinery and the stretch-out –wages
lagged far behind. Capital movement stemmed from the desire among
investors to take advantage of low-wage labor together with mechanized
production. The region’s unskilled, cheap labor attracted investment, but
work life remained relatively unchanged. The greater availability of tex-
tile work that resulted from capital mobility had little upward pressure
on wages because labor remained available and cheap given the region’s
agricultural plight.10
The predicament of southern agriculture during the decade, includ-
ing rock-bottom commodity prices, meant that poor southerners, both
white and black, looked to industrial employment to supplement family
incomes. Despite near-starvation wages, lint-filled air on textile factory
8 “Cotton Textile Gain Predicted by Sloan: Institute Head Cites Influences at Work and
Urges Refusal of Below-Cost Sales,” New York Times, 21 March 1932; Shaffer, In
Restraint of Trade, 204.
9 English, A Common Thread, 129. For Sloan’s leadership and conditions in the “sick”
textile industry in the 1920s, see Salmond, The General Textile Strike of 1934), 1–6.
New England Council, “History,” http://newenglandcouncil.com/about/history. See also
10
David Koistinen, Confronting Decline: The Political Economy of Deindustrialization

in Twentieth-Century New England (Gainesville: University Press of Florida, 2013);
Timothy W. Vanderburg, Cannon Mills and Kannapolis: Persistent Paternalism in a
Textile Town, (Knoxville: University of Tennessee Press, 2013), 98.
7 2
floors, and the paternalism of southern mill villages, unskilled workers

sought manufacturing work. The availability of labor meant manufac-
tures met little pressure to change their hiring practices. White workers
could gain entry to the factory floor; black workers, if hired at all, were
consigned to lower-paying janitorial services or manual labor. Southern
mills’ isolation favored employers: at Cannon Mills in North Carolina,
managers simply threatened to evict from the mill village workers who
organized or threatened to strike, knowing that they would have to move
many miles to find industrial employment elsewhere. Owners often suc-
ceeded in crushing labor uprisings by using their power with elected offi-
cials or hiring private security forces.11
As the Depression gripped the nation, textile workers, along with semi-
skilled and low-skilled workers in other industries across the country,
confronted substantial layoffs, but textile unemployment outpaced that
of other sectors of the economy. The sector’s problems of overproduction
and cost cutting, which included the slashing of wages, contributed to the
downward spiral of the nation’s consumer economy and compounded the
economic crisis. The industry needed help, and it was clear to southern
manufacturers that the federal government would need to be involved.12
In the South, textile leaders had attempted to confront pernicious prac-
tices, launching a number of state-level campaigns to ban night work and
child labor during the 1920s. Yet their paternalistic labor management
policies exerted social control alongside progress. Moreover, attempts
to end child labor and hypercompetition proved ineffectual and lacked
enforcement. Beset by excess capacity, rising foreign imports, and new
competitive materials like rayon and jute, the textile industry welcomed
cooperative solutions. Their own CTI failed to combat declining profit-
ability, and the NRA seemed a logical step out of the crisis. CTI leaders
looked to policymakers to address the situation by modifying existing
For the CTI’s efforts to control competition, see Gordon, New Deals, 98–99. For more
11
details on migration, see Jacquelyn Dowd Hall, et al., Like a Family: The Making of a
Southern Cotton Mill World (Chapel Hill: University of North Carolina Press, 1987),
197. Additional data on spindles in United States Congress House Committee on Labor,
To Regulate the Textile Industry: Hearings on H.R. 238, 10–26 May 1937 (Washington,
DC: Government Printing Office, 1937), 163.
A number of southern governors attempted to reign in destructive practices and put
12
a floor under wages, such as O. Max Gardner in North Carolina, and “industrialists
Charles Cannon and Ben Gossett took the lead in getting the CTI to restrict production.
Eighty percent of the industry cooperated in this and a further cutback, but prices still
were not stabilized by 1932. It was clear that only some form of national government
sanction would bring noncooperators into line.” Badger, North Carolina and the New
Deal, 5.
82
laws and passing new reforms. NRA cartelization allowed industry leaders
to set minimum prices in collaboration, which promised to thwart anti-
competitive practices that had driven deflation.13
These factors explain why textile industry leaders, despite concerns,
cooperated with Franklin Roosevelt’s first attempt to bring order to
industrial production. Southern manufacturers’ initially complied with
NRA codes, beginning with signing on to the NRA’s initial President’s
Re-Employment Agreement in the summer of 1933, prior to the
organization of individual industry codes. Outright resistance would
only add to business’s poor public reputation. Politically and practi-
cally, many southern manufacturers, as loyal Democrats, wanted to
see President Roosevelt succeed and their region receive some much
needed government aid, provided white elites could control disburse-
ment of funds.14
Southern textile leaders publicly supported the bill. In June 1933,
shortly after President Roosevelt signed the NIRA into law, William
Anderson of Georgia’s Bibb Manufacturing, declared it a “revolution-
ary bill” designed “to get the wheels turning” in the American economy.
The textile producer and American Cotton Manufacturers Association
(ACMA) president assured his employees that textile industry repre-
sentatives intended to “join hands with the President whole-heartedly”
to bring about industrial recovery. Anderson hinted to his company’s
officers that the measure might result in the implementation of more
machinery, thus leading to a reduction in overall number of workers
13 William Link described paternalistic reformers as “often erratic” as they “embraced

uplift and progress, yet believed in a hierarchy of race and culture; how they were fervent
advocates of democracy, yet also endorsed measures of coercion and control … reform-
ers wanted uplift and improvement but wanted to limit local participation and control.”
Link, The Paradox of Southern Progressivism, xii, 175–176. Scholars have also debated
the NRA’s effects on price setting and cartelization, particularly relating to the diversity
of products and ability to promote recovery of a healthy economic system. See Gordon,
New Deals, especially chapter 5; Christina D. Romer, “Why Did Prices Rise in the
1930s?” Journal of Economic History 59, no. 1 (1999), 167–199; Shaffer, In Restraint
of Trade, 110–113. One contemporary observer wrote that “fair trade practice” came
to mean “limiting losses or ensuring profits,” and led to rationing of production, price
manipulation once excess capacity had been eliminated, and the continuation of various
unfair practices. Charles Frederick Roos, prepared for the Cowles Commission, 1935,
NRA Economic Planning, (Bloomington, IN: Principa Press, 1937), 343–360. http://
cowles.econ.yale.edu/P/cm/m02/.
Butler Shaffer describes business response to the NRA as “irrepressible excitement”
14
because it endorsed “government-enforced ‘business self-regulation,” fulfilling hopes for

measures to curb competition. Shaffer, In Restraint of Trade, 108.
9 2
employed. Nevertheless, he assured his employees that “all the President

wanted to do was put two crews of people to work where one had been
at work before.”15
Indeed, textile firms counted among the first adopters of a code. Under
George Sloan’s leadership, the CTI drafted one of the first codes for the
cotton textile industry, a code that was friendly to management prefer-
ences. The relatively young CTI sought price and profit stability, goals it
had pursued during the cutthroat competition of the 1920s. The NRA,
by suspending the antitrust limitations that had thwarted the CTI’s pre-
vious efforts, allowed manufacturers to share information related to cost
of production and raw materials as well as pricing. The CTI remained
skeptical of the NIRA’s Section 7a allowing collective bargaining, but
the textile industry code proved to be one of the NRA’s early successes.
How well the NRA overcame the problems the CTI had faced remained
to be seen, particularly regarding regional noncompliance and ongoing
competition.16
Yet sectional divisions plagued the CTI and the NRA cotton textile
code board early on. Anderson, for example, hid from his workers his
profound distrust of federally directed reform. The NIRA, he feared, took
too large a step toward federal intervention in the economy. Anderson
and his allies preferred state-level regulations and local control of labor,
which allowed for small and southern firms’ maneuverability under pro-
duction and pricing schemes. Cooperation stemmed from their hope
that by adhering to the CTI-drafted code they could reap the benefits
of relaxed antitrust laws. Moreover, they could capitalize on the good-
will generated by their compliance to limit the effects of minimum wage
agreements on southern branches of the industry. Southern manufactur-
ers saw the law as the best chance at industrial self-government; it could
also preclude more intrusive reforms. Still, disillusionment rose within
the Institute’s ranks, frustration with NRA practices and provisions, and
15 William Anderson, ACMA unpublished minutes, Macon, GA, 20 June 1933. James
McDonald Comer Avondale Office Files, 1920–1958, Collection 7 Folder 146 Box 14
Archives, Birmingham Public Library (hereafter cited as Donald Comer Papers 7.Folder.
Box). Enforcement regarding labor practices tended to be friendly to manufacturers
because it was filtered through locally arranged labor boards. Badger, The New Deal and
North Carolina, 31.
Lassiter and Crespino, The Myth of Southern Exceptionalism, 9. Galambos, Competition
16
& Cooperation, 126–135. For more on Hoover’s associative arrangements, see Kenneth
Finegold and Theda Skocpol, State and Party in America’s New Deal (Madison: University
of Wisconsin Press, 1995), 55–56.
03
members’ annoyance at the CTI’s inability to achieve concessions from

government administrators on wider wage differentials.17
The situation called for a different kind of industrial organization,
and the SSIC fit the bill. The SSIC could curry favor among political
representatives by donning a cooperative attitude. It could sway politi-
cians by combining collective southern manufacturing perspectives on
New Deal measures, thereby serving an underlying goal of preserving
special treatment and low wages. Furthermore, the SSIC could work with
existing trade and business associations to amplify the voice of industry
in Washington.
On December 19, 1933, around 100 manufacturers came together at
the invitation of former NAM president John Edgerton and Tennessee
Manufacturers Association secretary C. C. Gilbert. Edgerton and Gilbert
gathered leaders of textile plants, steel producers, furniture makers, and
a range of other manufacturers in the region purportedly in support of
the New Deal and the NIRA. Textile leaders, including Anderson, were
instrumental in convening the SSIC, bringing together manufacturers and
prominent regional business leaders who were interested in preserving
the South’s separate labor market. The group gathered as an offshoot of
a South-wide industrial conference and presented their new organization
as “infant” southern industry’s protector.
Edgerton and Gilbert were savvy political insiders. Their involvement
in business associations taught them how to navigate Washington circles.
Edgerton, given his experience as NAM president, understood how to
sidestep concerns about the practices at southern mills and not to appear
as if he and his colleagues were trying to undermine northern industries –
or, more importantly, alienate powerful political allies in the Democratic
Party. Thus, cooperation served as the overall theme of the meeting. The
coordinators declared that they did not wish to threaten recovery or to
supplant established industrial organizations. The assembly resolved to
recognize the economic emergency in the same terms used in NIRA’s
preamble and pledged their cooperation. SSIC organizers claimed they
had no wish to challenge the New Deal. But they were dissatisfied with
the representation southern firms received from trade associations and
national business representatives, such as the NAM or the Chamber of
The CTI organized during the 1920s to confront overcompetition in the textile indus-
17
try, but its preferred methods violated antitrust laws. Of the two older cotton textile
manufacturers associations, the National Association of Cotton Manufacturers (NACM)
represented northern interests, and the ACMA represented southern firms. The CTI and
ACMA would merge in 1949. Galambos, Competition & Cooperation, 270–271.
1 3
Commerce, in the crafting of NRA codes. Cooperation seemed likely to

realize business’ long-cherished hope of industrial self-regulation, a goal
that trumped securing wage differentials for southern industries.18
Wage differentials existed in the code, but southern manufacturers
made sure to highlight the gains in southern wages compared to northern
increases. Under the NRA, wages and prices rose quickly and steeply. In
textiles, the code set the minimum wage at $13 a week. Southern workers
received $12 a week minimum, a $1 wage differential based on region.
According to industry-gathered figures, under the NRA, average hourly
earnings in the North between July 1933 and August 1934 rose 48.8 per-
cent for male workers and 61.3 percent for female workers. In the South,
hourly wages increased 70 percent for men, and 100 percent for women.
Southern wages grew more in proportion to northern wages despite the
$1 differential, because pre-NRA rates had been much lower there than
in other regions –a fact that manufacturers often ignored in touting their
cooperation and modification of business practices with the law.19
Edgerton’s woolen mill illustrated the changing patterns of work dis-
tribution after the codes went into effect. Prior to adopting the code, his
mill commonly sent piecework to elderly women occupying their chil-
dren’s mill village houses. While they rocked and watched the grand-
children, as Edgerton described their work life, they could earn a small
sum to augment the family’s wages. These women often worked forty
hours per week, but Edgerton considered himself to be engaging in “phil-
anthropic” activity by employing their services. He described the work-
force at his woolen mill as being divided into “two classes,” and little old
ladies could work in “comfortable” jobs “reserved for them” to “make
some contribution to the family expense.” This second class made $6 per
“Resolutions Adopted at the Organization Meeting in Chattanooga,” 19 December

18
1933, SSIC Papers Box 3, Folder 2.

Edgerton defended his practice of hiring grandmothers at $6 a week before a Senate hear-
19
ing. Statement of John Edgerton, “The Effect upon Southern Industry of Majority Rule
under NRA,” in U.S. Senate, Hearings on the National Recovery Administration before
the Senate Finance Committee, 12 April 1935, Reprinted by the SSIC, SSIC Papers Box
3, Folder 2. In 1932, average wages per hour for male weavers in the cotton goods sector
stood at 31.4¢ per hour, down from 40¢ in the previous year. Average hours per week
declined from the first decade of the century but stood at 53.1 per week. U.S. Department
of Commerce, Statistical Abstract of the United States, 1934, 56th Number (Washington,
DC: Government Printing Office, 1934) 297. Between 1933 and 1934, across manufac-
turing sectors, average hourly earnings rose 9¢ per hour after a sharp decline in 1931.
Average weekly hours, also across all sectors, dropped from 38.1 in 1933 to 34.6 in
1934. Susan B. Carter et al., eds., U.S. Department of Commerce, Historical Statistics of
the United States: Earliest Times to Present (Washington, DC: GPO, 2006), 170.
23
week prior to the NRA, a practice that diminished after regulations went
into effect, because such workers could not be transferred to jobs on the
shop floor. Workers earning NRA wages would take home much more
than the pieceworkers; many mills, including Edgerton’s, installed labor-
saving machinery to avoid increased labor costs for unskilled workers.
Still, in some southern plants take home pay nearly doubled for labor,
particularly for unskilled workers. A new hire in 1934 at John Edgerton’s
woolen mill, for example, earned $1 more per week than an experienced
spinner made prior to the NRA. Such increases occurred across south-
ern industrial sectors. Among hosiery producers, wages rose more than
twenty cents per hour, up 30 percent.20
Mills managers’ circumventions weakened wage increases for individ-
ual workers. Hour reductions, in particular, undermined wage increases,
which were impressive in the aggregate. Congress and the Roosevelt
administration intended that weekly hour reductions would help spread
the work over more employees, reducing unemployment. For individual
workers, wage gains thus proved less dramatic than the numbers touted
by industrialists suggest. At Virginia’s Dan River Mills, where hourly
wages increased by nearly 50 percent, the average number of work hours
per week decreased, resulting in a net wage gain for workers of only
11 percent. Meanwhile, consumer prices increased, thereby reducing
industrial workers’ purchasing power.21
Manufacturers’ overarching purpose in securing wage differentials
was to preserve the South’s labor market and cheap labor advantage
over other regions. Reduced labor costs encouraged investment in the
region and built southern sources of capital. The South had few features
to attract industry –its infrastructure, freight rates, and rurally based,
unskilled workers did not appeal to investors –so Dixie’s competitive
advantage was its cheap labor. This was Dixie’s main allure for employ-
ers, and the region’s industrialists organized to preserve it.
Rather than confronting the South’s economic deficiencies, the SSIC’s
message differentiated the southern economy for political purposes. Like
the New England Council, upon which Edgerton and his cohort modeled
James Jewell, Personal Interview, Lebanon, Tennessee, 23 March 2008. U.S. Senate
20
and House of Representatives, Senate Committee on Education and Labor and House
Committee on Labor, Joint Hearings on the Wage and Hour Bill, 75th Congress, 2nd
Sess., S. 2475 and H.R. 7200 (Washington, DC: GPO, 1937), 782.
Ronald Heinemann, Depression and New Deal in Virginia: The Enduring Dominion
21
(Charlottesville: University Press of Virginia, 1983), 54; Shaffer, In Restraint of Trade,

21–25, 75–76.
3
the SSIC, the organization would promote the South’s industrial future
and protect that future from being undermined by policies emanating
from Washington. SSIC leaders sought to close “gaps in the industrial
frontier,” as the Nashville Banner stated, but to do so in a way that pre-
served southern social patterns and hierarchies as well as patterns of
rural life and industry. SSIC leaders would do nothing to undermine the
South’s class structure, and they positioned themselves as possessing dif-
ferent values than northern capitalists.22
Still, southern industrialists mobilized to defend recently developed labor
management structures. The SSIC was a modern political response to a
modern economic reform, even though the organization’s arguments were
couched in traditionalism and assumptions about a separate South. Labor
management practices that southern industrialists employed, such as deter-
mining wages by race and gender, were not vestigial holdovers of the under-
developed, unmodernized South. Rather, these practices were implemented
in recent decades, as the region industrialized, and reflected managerial
impulses to control labor and prevent unionization. Manufacturers mobi-
lized to defend the social and class hierarchies of the New South and the mill
village, which were the arrangements that guaranteed the South’s economic
advantage in low wages as managerial capitalism moved southward.23
Alongside pursuing policy goals, SSIC leaders attempted to brand
southern manufacturing as providing humane workplaces that fit a
modern civilization. For southern industrialists, modernization and tra-
ditional values were not at odds. SSIC leaders blended these priorities
and invoked southern economic exceptionalism to preserve the South’s
low-wage labor advantage. This tactic would serve the long-term priority
of growing the South’s financial and investment base. But first, Edgerton
and his allies had to build their organization to sway policy in the South’s
favor and to mend the region’s reputation.24
“South’s Industrial Council” Nashville Banner, 6 March 1934. Reprinted by SSIC. SSIC
22
Papers Box 3 Folder 5.

Gavin Wright explains, “Segregation was indeed a long tradition, but separate wage-rates
23
were part of a new tradition, created by more than a half-century of southern industri-
alization on a segregated basis.” Wright, Old South, New South, 197; Brian Kelly, Race,
Class, and Power in the Alabama Coalfields, 1908–21 (Urbana-Champaign: University
of Illinois Press, 2001); “South’s Industrial Council,” Nashville Banner, March 6, 1934.
Mill hands often lived as second-class citizens in southern towns and cities, and devel-
24
oped a class consciousness of their own. See Carlton, Mill and Town in South Carolina,
1880–1920; Hall et al., Like a Family; Kuhn, Contesting the New South Order; Michelle
Brattain, The Politics of Whiteness: Race, Workers, and Culture in the Modern South
(Princeton, NJ: Princeton University Press, 2001). Douglas Flamming reinforces the idea
that mill village paternalism was a conduit for traditional values and social control,
43
Building a Membership Base
The nature of trade and business association representation, experiences
under specific codes, and dissatisfaction about the representation of
southern manufacturing prompted industry leaders to join the SSIC.
Textile manufacturers, representing the South’s most prominent
industry, set the organization’s tone and financed the SSIC in its early
years. Existing business and trade associations proved inadequate, in par-
ticular, in securing wage differentials for southern plants, representatives
of which often were outnumbered by northern manufacturers on code
boards and trade associations. The SSIC, which represented all indus-
trial sectors in Dixie, positioned itself to promote wage differentials in
industry-specific NRA codes and to increase southern representation on
code authorities across industrial sectors.
Other business associations nearly broke apart because of disputes
between regional interests, which added to the sense that the South
needed its own industrial representative that consolidated power across
industrial lines. One North Carolina clothing manufacturer lamented
that even after fifty years of development, southern firms drew “snickers”
from competitors who lacked “sympathy and understanding” of Dixie’s
sad circumstances. Manufacturing was relatively new in southern states,
he argued, and drew from a labor force with agricultural backgrounds.
These factors, along with southern mills’ rural locations and isolation
from other industrial establishments, weakened their position in trade
associations. Southern industrialists needed the SSIC to make a case
for better regional representation on code boards, and the organization
could do so effectively because it was a single voice that spoke with the
combined power of “isolated” industries.25
Even though many industrialists found workarounds to NRA codes,
southern manufacturers voiced concerns about the NRA. Discontent
emerged from traditional exemplars of New South commodity-oriented
arguing, “Welfare capitalism originated essentially as a labor market phenomenon, but,

once established, its programs served as conduits through which conventional values
and patterns of behavior flowed. As a result, paternalism emerged both as a modern
industrial system and a powerful cultural force.” Industrialists developed this system
because of their desire for labor market stability among workers, and it “marked a fun-
damental shift toward modern capitalist relations and an increasingly sophisticated free-
labor outlook among the southern plain folk.” Douglas Flamming, Creating the Modern
South: Millhands and Managers in Dalton, Georgia, 1884–1984 (Chapel Hill: University
of North Carolina Press, 1995), 121, 141.
J. B. West, Mt. Airy Clothing Manufacturing Co. to Bailey, 23 October 1933, Josiah
25
Bailey Papers 167.
5 3
Building a Membership Base 35
industries. The SSIC owed its first three years of existence to the sup-
port of textile, iron and steel, lumber, furniture, and petroleum and coal
producers –industries that focused on processing the region’s abundant
raw materials. Of the first SSIC donors, 33 percent were from textiles.
Forest products, which included furniture, followed textiles with 10 per-
cent of donors. Chemical producers, including fertilizer manufacturers,
proved generous despite their smaller numbers. Chemical executives
donated more funds than those in forest products, although they con-
stituted only 6.5 percent of members. These industries, in particular,
depended on keeping wages low to maintain competitive market posi-
tion. Early members sought powerful representation that could help
secure wage differentials under code authorities, but it took time for this
counterforce to coalesce.26
SSIC leaders struggled to be a common voice for Dixie’s manufactur-
ing sector, because southern industries were not uniformly integrated into
the national marketplace. Some textile industries were well nationalized,
relying on their New York merchandising offices to move goods for fur-
ther finishing or sale. Other sources of SSIC membership were widely
varied in production, marketing, and business organization, ranging from
furniture to tobacco manufacturing. Southern furniture manufacturers
tended to make “cheap and medium grade household furniture” destined
for local markets. These bedroom and dining pieces were sold to mostly
southern consumers who could only afford the cheap veneers that more
upscale buyers often considered tacky. Southern manufacturers tended to
make cheaper goods in general, which added a smaller amount of value
to the raw materials being processed.27
Interregional competition also influenced membership. The lumber
industry in the South faced growing competition from the large forest
product sources in the Northwest and internationally. Conversely, North
Carolina tobacco manufacturers led the country in cigarette produc-
tion and were the South’s leading example of a modern “big business.”
Consequently, variation in sources of competition and factors affecting
production cost made articulation of a South-wide argument difficult.
26 Howard W. Odum, Southern Regions of the United States (1936; reprt., New York:
Agathon Press, 1969), 445. Contributions from forest products rose during the 1930s as
the pulp and paper industry moved southward, notably with Union Bag & Paper’s estab-
lishment in Savannah in 1936, a company that would become a generous SSIC donor.
See William Boyd, “The Forest Is the Future?: Industrial Forestry and the Southern Pulp
and Paper Complex,” in Scranton, The Second Wave, 169.
J. T. Ryan, unpublished address, “Statement of the SFMA Relating to a Code of Fair
27
Competition for the Furniture Industry, NRA, 5 October 1933, Josiah Bailey Papers 167.
63
SSIC leaders could overcome these differences by appealing to regional

solidarity, glossing over intraregional differences. Although SSIC lead-
ers highlighted common economic factors, the strongest rallying points
for southern industrialists proved to be character, identity, history, and
regional pride because they saw these as the foundation of their compet-
itive advantage –their control of labor.28
Despite the association’s diverse membership, SSIC leaders’ anti-NRA
activism voiced the preferences of the South’s most prominent industry.
As previously noted, textile firms made up the majority of the SSIC’s
412 initial donors, with no industrial sector coming close in number of
donors or amount of donations. The industry also dominated the SSIC’s
leadership, with textile officials constituting more than half of the exec-
utive committee. Two SSIC executive vice presidents, Donald Comer
and William Anderson, represented two of the South’s largest textile
firms: Alabama’s Avondale Mills and Georgia’s Bibb Manufacturing. The
largest contribution to the SSIC in 1934 came from Alabama’s Selma
Manufacturing, a fabric producer that was a prominent site of labor
strikes that year. Textile interests, more than any other, defined “south-
ern” economic priorities.
Geographically, membership tended to reflect the dominant indus-
tries in each state, with a few exceptions. Textile producers comprised
more than 50 percent of Georgia’s SSIC members, a cotton-growing
state where textiles dominated in industrial Piedmont areas. Chemical
manufacturers comprised the largest portion of Tennessee’s member
industries, followed by textiles. Though each state offered only a few mem-
bers, forest producers dominated the membership of Florida, Mississippi,
and Louisiana. Three of Florida’s four members were lumber companies.
The state’s largest contributor, and only firm not in the forest products
sector, was Gulf Fertilizer of Tampa. Virginia and Texas members came
from varied industrial activities, mirroring these states’ more diversified
industrial economies. In Virginia, 22 percent of members were not indus-
trial establishments; they were business associations, distributors, indus-
trial suppliers and wholesalers, or other professionals such as attorneys,
architects, or engineers. In North Carolina, 80 percent of SSIC donations
came from textile producers, even though the state boasted the region’s
home-grown “big” business, tobacco. Because tobacco production was
On the tobacco and cigarette industry, see Carlton, “The Revolution from Above: The
28
National Market and the Beginnings of Industrialization in North Carolina,” 73–98;

Gordon, New Deals, 66–67.
7 3
Building a Membership Base 37
a largely southern-based industry, it did not suffer from nonsouthern

competition on code boards at the levels that the textile manufacturers
did. R. J. Reynolds contributed generously to the SSIC, but the tobacco
company’s donations were not remarkable and were not accompanied by
management’s involvement in the council.29
Membership was meager in Arkansas, Florida, Missouri, and
Mississippi in the SSIC’s first year, given the nature, or underdevelopment,
of industry in those areas. Donors from the upper and western South
would increase rapidly in 1935 as the council capitalized on industries’
growing unhappiness with the NRA and New Deal regulations. What
early members shared was that a focus on processing locally sourced raw
materials, often importing mature industrial technology to build their
plants. Even though they were divided by industry, state, organization,
and marketing, SSIC member firms shared a reliance on low-wage labor.
These industrial leaders all desired a strong voice to argue for a wage
differential.30
Membership grew largely by word of mouth and through press cov-
erage. Vice President William Anderson took right away to promoting
the council as a facilitator of intraregional cooperation. He wrote Tom
Marchant, head of the southern-based ACMA (the National Association
of Cotton Manufacturers represented the industry’s northern branch),
and encouraged cooperation with the NRA. “If [the SSIC] should turn
out to be what it promises to be,” Anderson noted, “it may be the very
vehicle through which we of the South can work in attempting to have
our interests protected.” The council, he decided, would not be limited by
the concerns of trade associations and would be able to represent all lines
of manufacturing in the South, not just textiles.31
Furthermore, the SSIC would make up for the NAM’s shortcomings.
Anderson argued that the NAM, under Robert Lund’s leadership, had
taken its eye off the ball and failed to protect southern manufacturers.
SSIC leaders would do what NAM would not: make New Deal pro-
grams, especially the NRA, work in the South’s favor. Leaders justified
SSIC Account Books, 1934–1945. R. J. Reynolds gave $100 in 1934 and 1935, but
29
increased donations in 1936, likely resulting from the SSIC’s antiunion activism. Other
tobacco donors included American Snuff of Memphis, which gave $100 each year, and
Larus & Brother Co., of Richmond, makers of Edgeworth Pipe Tobacco.
Southern industrialists also made good use of state governments to facilitate devel-
30
opment and modernize local economies, Carlton and Coclanis, “The Uninventive
South?: A Quantitative look at Region and American Inventiveness,” in Carlton and
Coclanis, The South, the Nation, and the World.
Anderson to Marchant, 9 February 1934, Donald Comer Papers 7.104.6.
31
83
the SSIC’s existence on the grounds that national associations could not
properly defend the needs of southern industries. SSIC leaders saw them-
selves as taking up the cause pioneered by their fathers and grandfathers
who had built the New South. Once again, southern industrialists would
help redeem the region.
A Distinctive Economy
In the late nineteenth century, New South boosters promised to invig-
orate the region’s economy despite limitations in labor, infrastructure,
market access, and the dominance of a cash crop–intensive, agricultural
economy. Distinct from local traditionalists who looked warily at outside
reform, boosters heralded the promise of industry to provide “uplift” and
often embraced progressive reforms to solve the South’s problems in edu-
cation, health, or moral fortitude. Mill villages provided ready sites to
steer the region’s populace toward modernity, according to New South
boosters. SSIC leaders embraced these sentiments with the goal of secur-
ing wage differentials for southern industries. The South was exceptional
and deserved special treatment, SSIC leaders argued, because its economy
possessed a different character than the North’s. The South’s industry,
they contended, was in its infancy. The 1930s heirs of New South boost-
ers clung steadfastly to the promise of progress that their forebears made,
and they highlighted the region’s persistent backwardness to suit their
political ends: to modify the New Deal to accommodate their preferred
patterns of labor-management relations and the region’s labor market.
Southern dissatisfaction with the NRA emerged from prominent indus-
tries, such as textiles, but the revolt extended across most lines of Dixie’s
manufacturing sectors. Thus the SSIC used a simple, consistent argument
to unify regional criticisms of the New Deal.32
SSIC co-founder Donald Comer’s Alabama family was “long identified with its own
32
brand of humanitarian and enlightened business progressivism.” William D. Barnard,

Dixiecrats and Democrats: Alabama Politics, 1942– 1950 (University: University of
Alabama Press, 1974), 117–118. For the challenges facing New South industrial develop-
ment, see Cobb, Industrialization and Southern Society, 1877–1984, 10–26. Many SSIC
founders and early members qualified as southern progressives and liberals. Michael
Breedlove argues that Donald Comer, an SSIC founder, qualified both as progressive
and New Dealer. Michael Breedlove, “Donald Comer: New Southerner, New Dealer”
(Ph.D. Dissertation, American University, 1990), 12–13. SSIC rhetoric often resembled
“problem South” depictions from southern liberals and progressives, of which Natalie
Ring offers a comprehensive interpretation. “An equally powerful and opposing set of
representations about the South as a backward region played counterpoint to the nos-
talgic image of the reconciled New South and distorted the nation-state’s myth-making
9 3
A Distinctive Economy 39
The Birmingham Age-Herald published a cartoon in February 1934

that represented SSIC leaders’ infant industry argument. (Figure 1) Set
in a restaurant, the cartoon shows an overfed and fleshy man, tagged
“Northern and Eastern Adult Industries,” digging into his dinner at
the “Recovery Table” while a hungry child, labeled “Southern Infant
Industries,” armed only with a bib and a spoon, is too small and help-
less to even reach the top of the table. Even while the gluttonous diner
enjoys his feast, however, he has noticed two figures conversing in the
background, at the entrance to the NRA Kitchen. A genial gentleman rep-
resenting the “Southern States Industrial Council” proffers a high chair
labeled “Differentials” to General Johnson, the NRA administrator, who
is dressed as the restaurant chef. The SSIC representative explains, “We
want this for the child to use.” The caption reads, “No One Could Object
To That.” The cartoon depicted the differentials as a reasonable solution
to the imbalance in industrial conditions; wage differentials addressed
regional inequities within the NRA.33
Revisiting Alexander Hamilton’s language in his 1791 Report on
Manufactures, which advocated for tariffs to shield “infant” manufac-
turing against imports produced with “superior skill and maturity,” the
cartoon presented its case for wage differentials as a matter of common
sense. Like American industries of the Early Republic, compared with
Great Britain, manufacturers in the South lacked sufficient economies
of scale and human capital to compete with established northern and
midwestern industries. “No One Could Object” to a measure that sought
to help a disadvantaged region reach the level of industry found in other
sections.34
The cartoon, like the SSIC, did not point to any single enemy of the
South; both simply suggested a measure to adjust for natural conditions
efforts to construct a more benign social memory of the Civil War and its consequences.”
SSIC leaders straddled these narratives in the 1930s to achieve political goals. Natalie
J. Ring, Region, Empire, and the New Liberal State, 1880–1930 (Athens: University of
Georgia Press, 2012), 5–6. For southern progressive crusades and their limits, see Link,
The Paradox of Southern Progressivism, passim.
“No One Could Object to That,” Birmingham Age-Herald, 24 February 1934, Reprinted
33
by the SSIC. The cartoon appeared in the Avondale Sun, the monthly company publica-
tion for Donald Comer’s Avondale Mills and was distributed to workers at the compa-
ny’s nine plants. The Avondale Sun, 17 March 1934, Volume 9, Number 19, p. 2. The
Avondale Sun, 1932–2006, from the B. B. Comer Memorial Library Avondale Mills files,
hosted by Birmingham Public Library Digital Collections, www.bplonline.org.
Alexander Hamilton, Report on Manufactures: Communication to the House of
34
Representatives, December 5, 1791, presented in Congress by Mr. Smoot, reprinted

(Washington, DC: GPO, 1913), 38–39.
04
Figure 1 Unknown artist. “No One Could Object to That,” Birmingham Age-Herald,
February 18, 1934.
Source: Illustrator unknown. Courtesy of Tennessee State Library and Archives,
Nashville, TN, Papers of the Southern States Industrial Council Records (1933–1973),
Scrapbook, December 1933 –April 1935.
1 4
of inequality so that all regions could prosper under the New Deal. The
SSIC reprinted the cartoon and disseminated it widely, mailing it to
congressional representatives and employers, who could distribute it to
workers in southern factories. The cartoon’s simplicity reflected the nar-
row concerns of the newly formed SSIC, the organization’s approach to
modifying the New Deal, and the priority of securing wage differentials
among southern manufacturers who donated to the council. Demands
for treating South as a separate economic region united southern manu-
facturers regardless of industry.
To preserve low wages, the SSIC’s central goal, manufacturers depicted
the South as separate economically and socially, with divergent labor,
production costs, market access, transportation costs, and culture –or
“civilization,” as it was called at the time. The standard SSIC-articulated
rationale for special treatment relied on the idea that the South was not
fully modernized: laborers in the South’s infant industry had not become
accustomed to industrial life and could not compete against northern
labor. The SSIC’s continued depiction of the South as an infant, disad-
vantaged by its adult neighbors, was an appeal for the administration
to limit regulations in the South to allow its industrial base to develop.
Southern elites, free from onerous regulations, could thus steward the
section’s progress and cultivate southern labor. SSIC leaders referred to
their labor pool’s “subnormal” members to justify wage differentials.
“Subnormal” workers, they implied, referring to women and African
Americans, deserved lower wages than adult white men did. Infant indus-
try implied lower efficiency of labor; unskilled workers could not earn
similar compensation because their inefficiency undermined the value
added to southern goods, which were already coarser than goods pro-
duced in the North. Babies could not produce at the same rate as, and
with the efficiency of, adults. Southern manufacturers neatly sidestepped
the issue of destructive interregional competition by pointing to their
region’s deficiencies.35
Moreover, SSIC leaders insisted that the NRA, as staffed, unduly
harmed the South’s infant industry while privileging more developed
areas. To preserve the South’s industrial economy and its competitive-
ness, the region needed to preserve its low wages. Northern competi-
tors, SSIC leaders charged, used the NRA to undermine this advantage,
35 “Resolutions Adopted at the Organization Meeting in Chattanooga.” References to the

quality of southern labor appeared frequently in correspondence among manufacturers
and in speeches shared among them and with southern members of Congress. See letters
in DC 7.146.12.
24
a charge with some merit. Textile leaders, in particular, drafted their

code with interregional wage competition in mind, along with confront-
ing overproduction and overcapacity. Even though industrialization in
the South followed distinctly localized patterns, with, as one historian
explained, “southern entrepreneurs, businessmen, and community lead-
ers” seeking industrialization that befitted local circumstances, they
shared a similar strategy of luring “an existing and mature capitalist
system.” Southern industrialists, combined in the SSIC, identified the
availability of low-wage labor as a central factor in this process of
industrialization. As SSIC vice president Donald Comer insisted, “This
differential in wage cost has been an absolute requisite in the cost of
production in the South.” To account for uneven industrialization across
regions, he argued, the NRA required a leveling mechanism. Comer
and his SSIC allies protested that they sought to restore “fair” competi-
tion, since NRA codes privileged northern, urban interests over south-
ern ones by setting wages at levels closer to non-southern branches of
industry.36
The “infant” industry defense of wage differentials pervaded the
SSIC’s official statements, leaders’ testimonies before Congress and code
boards, and members’ letters to southern representatives. Other “natural”
causes defined the southern economy as separate. Climate, in SSIC rhet-
oric, ranked high among the list of factors that limited a worker’s ability
to apply “steady and constant labor.” Heat and humidity meant lower
fuel costs in the winter but lower levels of productivity in the summer,
manufacturers argued. SSIC leaders painted production cycles as subject
to the seasons as much as agriculture’s –a disingenuous, if not outright
misleading, statement. A more convincing argument was that climatic
effects, such as the lack of harsh winters requiring heating fuel or abun-
dant local food sources, alongside seasonal market fluctuations for
southern-produced goods, decreased the overall cost of living, and there-
fore southern workers required less in wages for a comfortable existence.
The desire to grow southern consumption motivated manufacturers’ call
for holding prices down in aggregate; for southern workers to buy the
products of southern mills, prices needed to stay accessible, thus further
36 Shaffer, In Restraint of Trade, 202– 205. Pamela C. Edwards, “Entrepreneurial

Networks and the Textile Industry: Technology, Innovation, and Labor in the American
Southeast, 1890–1925,” in Susanna Delfino and Michele Gillespie, eds., Technology,
Innovation, and Southern Industrialization: From the Antebellum to the Computer
Age (Columbia: University of Missouri Press, 2008), 160–161. Comer to Lister Hill, 5
January 1934, Donald Comer Papers 7.138.18.
3 4
justifying the need to keep cost of production low via lower minimum
wages for the region.37
Geography factored into SSIC leaders’ arguments, as well. C. C. Gilbert
identified market distance and low levels of consumption in the South as
among the region’s disadvantages. The North’s large metropolitan areas,
Gilbert argued, were “logical” markets for manufactured products, but
distance from these markets put southern manufacturers at a disadvan-
tage. Location and the structure of freight rates burdened southern indus-
try and outweighed competitive advantage in lower wages. After a 1920
Interstate Commerce Commission (ICC) revision, class rates from South
to North tended to be higher per mile. Southern manufacturers pointed
out this fact to highlight that regional economic conflict persisted, and
that the South lagged behind the nation in development even as com-
modity and special rates varied, often in their favor. The higher cost of
transportation, Gilbert continued, “makes it extremely difficult to plan
production on a large scale because of inability to control or gauge possi-
ble consuming power. Where unit production must be held down, the per
unit cost of manufacture necessarily is increased.” Southern industrialists
defined protective measures as anything that maintained their ability to
keep wages lower than their northern counterparts’ rates.38
SSIC leaders based their case for special treatment for the South on
the idea of innate differences between city and rural workers and the
value of the products they produced. “In textiles [northern industries]
have been used to making fine sheer garments or expensive designs,”
C. C. Gilbert explained, and “they are used to handling silks and sat-
ins, so schooled that they can move from textile mills into watch mak-
ing and tool making.” In fairness, he asserted, southern manufacturers
could not pay workers who made a rough jute bag, a pair of overalls,
or a work shirt the same amount for loom hours as those making fine
silk, voile, or chiffon garments. Southern mechanization, worker skill,
and specialization had not evolved to parity with the North, the SSIC
maintained, thus justifying a wage differential. This interpretation was
prevalent in the letters business owners penned to their political repre-
sentatives. The southern protest emerged because of structural differ-
ences between northern and southern industrial economies. The NRA
sought to equalize wages across region with the goal of raising levels
of southern consumption, but it also undermined the South’s primary
“Resolutions Adopted at the Organization Meeting in Chattanooga.”

37
Gilbert to Comer, 4 December 1934, Donald Comer Papers 7.113.19.

38
4
competitive advantage. On top of these concerns, southern manufacturers

added cost of production. Unit production cost, a by-product of worker
efficiency, labor costs, and value of products, was higher in the South
because the region’s industries produced goods with lower value added
by manufacture. Southern manufacturers hoped that by pursuing wage
differentials they could highlight such pernicious challenges to federally
mandated regulation of wages.39
SSIC leaders deployed these economic arguments frequently and added
manipulative statements to promote the idea of a disadvantaged South
being developed by benevolent industrialists. While these arguments aug-
mented SSIC representatives’ demands for wage differentials, they also
depended on the negative reputation of southern industry. SSIC leaders
walked a fine line between defending low wages and further diminish-
ing southern industry’s reputation. SSIC leaders attempted to justify low
wages in southern industry by assuming an air of benevolent paternalists.
But such posturing served a larger political purpose by highlighting the
South’s economic fortunes vis-à-vis the nation. The invocations of south-
ern culture and difference, often tinged with sentimentalism, disguised a
calculated strategy to make the region appear uncompetitive. After all,
how could the South’s infant industries compete with the mighty, mature
industries of the north?40
John Edgerton viewed NRA attempts to enforce wage equality as a
campaign to protect northern industry from southern competition. He
accused the administration of having a paternalistic attitude toward
the South, which undermined southern leadership. “In their minds,” he
told SSIC members, “our factories and places of business are filled with
Negroes, little children and illiterates … who must be emancipated by
the reforming hands of a more humanitarian and enlightened section of
the country.” Edgerton reported that one northern manufacturer told
him, “ ‘I don’t propose to allow the Negro labor of the South to degrade
that of other sections of the country.’ ” While this statement suggests that
Edgerton’s arguments about southern labor backfired, compounding the
negative image of southern industry and labor, it served the SSIC presi-
dent’s goals by highlighting the separate southern economy. He and his
organization aimed to keep the status of southern workers under the pur-
view of Dixie’s local elites so that these men could guide industrial devel-
opment as they saw fit while also maintaining control of labor. As long as
Ibid.
39
“Resolutions Adopted at the Organization Meeting in Chattanooga.”

40
5 4
Achieving Special Treatment: The SSIC in Washington 45
they could prevent the administration from meddling in the South’s labor
market, all would be well.41
SSIC leaders promoted their organization as the best advocate for
preserving the southern labor market and its “character.” National
business associations focused too heavily on “principles,” they charged.
The NAM could offer no mediation for the South’s problems under the
NRA. Disgruntled southern manufacturers relied on their trade associ-
ations –whether organized by region, as with the Southern Furniture
Manufacturers Association (SFMA), or nationally, as with the CTI –to
articulate their desire for wage differentials and greater southern repre-
sentation on code boards. These associations, however, could not speak
for southern industry as a whole, and neither could they promote a polit-
ical economy that would increase the South’s prospects for beneficial
economic development. Regional associations, such as the SFMA, the
Southern Pine Association, and the Southern Garment Manufacturers
Association, had to contend with powerful national trade associations
dominated by non-southern competitors. The SSIC could speak with
authority for wage differentials on behalf of manufacturing across the
region, adding power to the arguments of associations serving particular
industries in the region. Members of the SSIC’s Washington office and
John Edgerton pursued wage differentials with vigor throughout 1934.42
Achieving Special Treatment: The SSIC

in Washington
Boasting a growing membership and well-honed arguments, the SSIC
emerged in Washington as a robust lobbying organization. SSIC leaders’
first order of business was to improve southern representation on individ-
ual code boards. During testimony before code authorities and in hear-
ings on the NRA before the House of Representatives, John Edgerton and
the SSIC’s representatives deployed the infant-industry rhetoric to high-
light the South’s lack of representation. Donald Comer reviewed mem-
bership on 210 selected code boards, composed of 2,033 manufacturers
Finegold and Skocpol, State and Party in America’s New Deal, 10–12; Schulman, From
41
Cotton Belt to Sunbelt, 29; Biles, The South and the New Deal, 111; John Edgerton to
Constituency, 14 April 1934, SSIC Papers Box 3, Folder 2.
The Vice President of the Southern Pine Association wrote of the competitive disad-
42
vantage faced by the southern lumber industry under the code. H. C. Berckes, “Wage
Differential Essential to the Progress of the South,” Manufacturers’ Record 103
(September 1934), 18–19.
64
and trade association representatives. Of these members, he testified, only

181 came from one of the “thirteen southern states.” Comer testified that
148 out of the 210 code authorities –70 percent –lacked a single south-
ern representative. Because only 8 percent of code representatives hailed
from southern states, C. C. Gilbert argued, “Industry in the South is abso-
lutely helpless.”43
Edgerton, Gilbert, and other SSIC leaders undertook a two-pronged
approach to better southern treatment under the early New Deal. First,
they presented their claims of unfair representation and regional classifica-
tion errors to NRA administrators; second, they took it upon themselves
to represent grievances regarding southern representation on specific
code authorities. Minority status on NRA industrial code authorities
meant that unique southern needs had only a small voice in the delibera-
tions of industry-wide wage rates and prices. Code board representation
varied by industry, but the SSIC made a case for discrimination that could
apply to any regional industrial establishment. Essentially, the SSIC could
peddle the same “discrimination” argument to any code hearing.
SSIC representatives hung their argument that the South suffered
from discrimination on the number of southern representatives on
code boards. As SSIC representatives argued repeatedly, the South was
home to a greater number of factories than the North and Midwest
in the cotton goods sector of textile manufacturing. All other sectors
except lumber were in the minority. The South was home to only 30
establishments producing woolen goods –including John Edgerton’s
own Lebanon Woolen Mill –compared to 352 establishments in the
Northeast and 61 in the Midwestern states. In furniture production,
an industry that SSIC spokesmen cited often for difficulties under the
NRA, the South hosted 406 establishments, compared to 1,521 in the
Northeast and 1,296 in the Midwest. Lumber and timber products
had 7,959 establishments in the South, compared to 1,580 and 1,093,
respectively, in the Northeast and Midwest, but southern plants tended
to be much smaller than their non-southern counterparts. The SSIC
collected data from across industrial sectors to make a general case
for southern discrimination on boards and to call for the protection of
minority interests.44
Gilbert to Anderson, 28 February 1934, Donald Comer Papers 7.116.2. Donald Comer,
43
“Code Authorities” speech before the Meeting of the Southern States Industrial Council,
Birmingham, AL, 26 February 1934, SSIC Papers Box 3, Folder 2.
Robert Sidney Smith, Mill on the Dan: A History of Dan River Mills, 1882–1950
44
(Durham, NC: Duke University Press, 1960), 393–394.

7 4
Labeling her facts “pertinent, potent, pungent,” SSIC director of research

Margaret Mager published the following figures to attest to the meager
wage differentials included in codes. “Of the 524 codes approved to June
7, 1934 (including supplementary codes and codes with labor provisions
only) only 247 provide a differential in wages between the South and other
sections! [Mager’s emphasis]” Analyzing code authority membership as a
whole, Mager continued to build the argument for discrimination. Less than
half of codes included a differential for southern industries. Furthermore,
“Of 3,186 total membership on code authorities,” Mager reported, “only
298 are from the South! Less than 10 percent!” That 10 percent was dis-
tributed amongst many different code-making bodies where they consti-
tuted an insufficient minority, insufficient in most cases, Mager argued, to
have any impact on code board decisions. Industries from other sections,
because they occupied the majority on most code boards, could overrule
southern representatives.45
Defining what constituted “southern” presented problems for indus-
trialists arguing for a southern wage differential. SSIC publications
stated which states the organization represented, though the list would
change. In 1934, the SSIC represented “the thirteen southern states,”
which included Kentucky and Missouri. Oklahoma and West Virginia
would later be included. The problem arose, Mager pointed out, when
individual codes “classified border Southern states as ‘northern,’ thus
causing hardship to many manufacturers.” Mager’s research concluded
that sixty-seven codes considered Kentucky a northern state, and twenty-
six, twenty-eight, and twenty-seven, respectively, considered Virginia,
Arkansas, and Texas as northern. Fifty-two of Oklahoma’s governing
code authorities considered that state’s industries as northern establish-
ments. Mager asked code board members to keep the council informed
of upcoming hearings in which they could have some impact. Naturally,
many industries in border states wanted to access the differential rates,
but many shied away from classification as a “southern” state. Western
states’ business leaders, such as in Texas, Oklahoma, and Missouri, how-
ever, were more likely to join the SSIC than states such as Maryland and
West Virginia, bordering the North.46
Margaret Mager, “Facts: Pertinent, Potent, Pungent.” Research Division, Nashville,

45
Tennessee. Publication of the Southern States Industrial Council. 20 June 1934, SSIC
Papers Box 3, Folder 3.
Mager, “Facts.” Gilbert to Comer et al, 16 October 1934, Donald Comer Papers 7.119.13.
46
H. W. Ellerson to Edgerton, 12 October 1934, Donald Comer Papers 7.119.13.

84
Mager’s research informed SSIC testimony for industrial sectors with

southern branches. SSIC leaders spent most of their time in Washington
advocating for industries without “adequate” representation on code
board hearings, meaning that they represented industries without a
southern-based trade association. By November 1934, the council had
appeared at various code hearings on behalf of twenty-five groups of
southern industrialists at various code hearings. One such request came
in September from the cotton glove industry’s southern members. These
manufacturers were at a distinct disadvantage to their more numer-
ous northern and midwestern counterparts. The South possessed nine
glove and mitten manufacturing establishments, compared to thirty in
the North and seventy-six in the Midwest. With only 7 percent of the
nation’s 115 cotton glove manufacturers located in Dixie, southern glove
manufacturers requested the SSIC’s representation at their code hearing
in Washington to strengthen their appeal for a regional wage differen-
tial. SSIC efforts for the southern glove manufacturers revealed the orga-
nization’s strategy of being useful to industrial sectors where southern
representatives were in the minority on code boards and lacked a strong
business association to represent their demands, or where southerners sat
in the minority in those associations.47
The glove board’s hearings considered several plans for the industry
code’s future. In the existing code, glove manufacturers agreed to pay a
minimum of 32.5 cents per hour for skilled labor, while unskilled received
30 cents. The South received no differential in the agreed rate. On top of
that rate, the code authorities granted a temporary “stay” that provided
for a $1 per week differential. The glove code board met to consider the
maintenance of wage rates as established under the “stay,” or to increase
the minimum rate overall but still allow for the $1 differential. Though
the differential would continue under the new plan, southern glove man-
ufacturers, with SSIC support, resisted efforts to raise their wages in any
manner. C. C. Gilbert reported to the SSIC’s Board of Directors that their
efforts were successful, in that they were able to halt the increase, and he
noted the $300 given to the organization in appreciation for the SSIC’s
47 Gilbert, Report to SSIC Board of Directors, 9 November 1934, Donald Comer Papers
7.124.14. Odum, Southern Regions of the United States, 440. In 1935, there were 115
cotton glove manufacturers listed, up from 91 in 1933. Therefore, in 1934 southern man-
ufacturers likely comprised an even smaller percentage of cotton glove manufacturing,
nationally. In 1935, the industry employed 8,040, down from 8,586 in 1933. The value
of products produced had risen, however, from $16,012,000 to $18,433,000. United
States, Bureau of the Census, Statistical Abstract of the United States, 1938 (Washington,
DC: GPO, 1939), 759.
9 4
testimony. Similar thanks arrived from a satisfied southern member of the

Pulp and Paper Code.48
The SSIC’s goal, to stop wage increases without damaging the reputa-
tion of southern manufacturing, was as much about public relations as it
was political lobbying. In testimony and speeches, SSIC leaders avoided
criticizing the NRA’s approach to recovery, signaling the SSIC’s pragmatic,
limited political strategy, one calculated not to ruffle the feathers of poli-
ticians, and which reflected business’ desire for anticompetitive measures.
In private, SSIC founder John Edgerton embraced this approach grudg-
ingly, conceding the complex economic and political atmosphere. Donald
Comer observed that collective industrial opinion fell closer to their
own personal attitudes, which welcomed the NRA –with qualifications.
Only once during testimony, Comer reported later, “did I hear the policy
advocated of ‘Every fellow for himself and the Devil take the hindmost,’
and this utterance provoked little or no applause.” SSIC leaders were
heartened, however, to observe southern manufacturers’ general opinion
that industrial control and regulation should be narrow in scope. On
this point there tended to be consensus about the dangers of government
power when it came to hour and wage regulations –only industrial lead-
ers, they argued, should set wages and self-regulate. Painting a picture of
benevolent employers who only wanted to protect their workers’ jobs,
SSIC leaders hid their mission to keep wage rates low to draw industry to
the region. They sought to weaken the impact of New Deal regulations
on the southern economy in order to preserve the status quo while main-
taining their paternalistic public image, hoping to prevent more drastic
regulation of the economy.49
In this manner, in 1934, SSIC leaders carefully prevented the expansion
of their organization’s focus while many industrialists complained in pri-
vate about New Deal programs. Most of all, the council crafted a plan to
secure special treatment for the South on a piecemeal basis. John Edgerton
Gilbert, Report to SSIC Board of Directors, 9 November 1934. By November 1934 the
48
SSIC had received close to $17,000 in contributions. Individual contributions rarely

exceeded $100; many were $25 or less. In 1934, Newton Glove of Newton, North
Carolina, gave $25 to the SSIC, increased to $40 in 1935 and $50 in 1936 (continuing at
that level for several years) SSIC Account Books, 1934–1946.
Comer to Anderson, Barr, Marchant, et al, 10 March 1934, Donald Comer Papers
49
7.146.12. White workers, who largely accepted federal activism on behalf of labor,
accepted such interventions, similar to their employers, on “distinctly regional and
racialized terms. As southern whites have also expected the state to reflect their under-
standing of an appropriate racial order, and these views persisted [long after the textile
strike of 1934].” Brattain, The Politics of Whiteness, 50.
05
stressed to fellow industrialists that the task of securing adequate wage

differentials was a “big one,” and that they should focus on protecting the
South and its industrial potential under the NRA. Confronting further
possible federal involvement in the economy required a soft approach,
which sometimes meant acceptance of the administration’s ministering
to southern states. Other challenges, such as the South’s minority status
on code boards and preservation and expansion of wage differentials,
necessitated a stronger, collective resistance. Edgerton pledged in public
and private to remain focused on wage differentials so as not to lose sight
of an achievable goal. The SSIC might not be able to block the Tennessee
Valley Authority (TVA), for example, but it could modify certain laws to
maintain a core competitive advantage.50
Yet internal bickering among southern manufacturers (whom SSIC
leaders were trying to court as donors) about the overall usefulness of the
NRA yielded a politically oriented, driven SSIC leadership and precipi-
tated a stronger iteration of southern economic exceptionalism. Textile
interests proved the most difficult to wrangle into common purpose, even
on the issue of wage differentials. Debate grew heated enough for one
board member to describe textile interests as being in discord on the
subject, citing three large Nashville textile manufacturers who opposed
the SSIC’s activism on the matter. Secretary C. C. Gilbert attributed such
opposition to manufacturers’ high regard for their workers’ abilities; they
felt their workers deserved a higher wage. SSIC leaders tried to use such
disunity over the NRA to highlight the SSIC’s mission of uniting southern
manufacturers around a platform of southern protection. Manufacturers
who differed from the SSIC on wage differentials, such as those Gilbert
cited, embraced a view of southern industry, its labor, character, and
mode of operation, as distinct from other regions. Their “regard” for
workers’ skill, Gilbert explained, stemmed from the selectivity southern
manufacturers employed in hiring workers: they were able to reserve the
highest paid jobs for the most “deserving,” who, in their minds, were
white men.51
SSIC leaders like Gilbert envisioned a stronger organization that
defended the South, its history and traditions, and its economic place
within the nation. The SSIC depicted a homogenous South dominated
Ibid. Edgerton, Minutes of Board Meeting, Birmingham, Alabama, 19 March 1934,

50
Donald Comer Papers 7.116.2. Edgerton to Comer, 11 November 1934, Donald Comer
Papers 7.124.14.
Comer to Anderson, 28 June 1934, Donald Comer Papers 7.104.7. Gilbert to Comer, 28
51
November 1934, Donald Comer Papers 7.113.19.

1 5
Growing Distrust 51
by people of “Anglo- Saxon blood,” believing in one God and “one

fundamental philosophy of life.” SSIC members indeed tended to espouse
a common social worldview. To SSIC members, the South was demo-
cratic, God-fearing, liberty-loving, and proud of its traditions. SSIC lead-
ers touted southern exceptionalism, even if members differed on matters
of policy. The SSIC’s architects hoped that their glossing over different
interpretations of the NRA and other New Deal programs would unite
manufacturers as southerners first and then build a coalition to pre-
serve the South’s labor market and paternalistic management practices.
Underneath these invocations of southern pride and identity remained a
central goal: maintaining low wages, the basis of the “southern way of
life” –at least in the mill village.52
Growing Distrust
By mid-1934, the SSIC’s leaders and membership voiced more frequent
New Deal criticisms. Although Edgerton, Comer, and Anderson formed
the SSIC to work within the New Deal and the NRA to secure protections
for the South’s manufacturing sectors, few successes emerged. Moreover,
SSIC leaders suspected that administrators promoted an image of the
South as backward or exploitative of labor, damaging not only the South’s
established economic interests but also the region’s ability to recover.
Ironically, New Dealers voiced similar depictions of the South’s
deficiencies. Tensions continued to rise, indicating that the true debate
between SSIC leaders and New Dealers was about policy, not differing
conceptions regarding the nature of southern industry. Southern indus-
trialists reacted strongly against any criticism of their region’s industrial
practices, even as they simultaneously relied on the depiction of their
region’s industry as in its “infancy.” William Anderson illustrated this
view when he stated, “to decry or condemn the mill village would be
to deplore the industrial development of the South.” SSIC and southern
industrial leaders’ criticism of administrators focused on apparent mis-
understandings, willful or not, of the South and its character, and they
hoped that this strategy would achieve their policy ends.53
52 “Address of John E. Edgerton before the Conference on Business & Industry,” Atlanta,
GA, 22 May 1934. Southern States Industrial Council Publication, SSIC Papers Box 3,
Folder 2, 4.
Anderson to Comer, 23 June 1933, Donald Comer Papers 7.146.6. This suspicion of
53
“New Dealers” preceded the return within the Roosevelt administration to a stron-
ger antimonopolist view of the greed of corporate capitalists, a suspicion that had not
25
The Depression strained mill owners’ contention that mill village

corporate welfare could provide the best outcomes for southern workers.
Rising tensions with labor sharpened industrialists’ emphasis on south-
ern solidarity. The outbreak of the twenty-two-day Textile Workers Strike
across the South in September 1934 inflamed these manufacturers’ sense
that they needed protection from outside interference. Southern gover-
nors called up the National Guard to quell the unrest and violent repri-
sals from management sympathizers. The strikes lasted less than a month
and were regarded as a failure for the United Textile Workers of America
(UTW), but southern manufacturers’ crackdowns on labor belied these
artfully projected images of paternalist employers and instead revealed
their anxieties about loss of political and economic power and the
“southern way of life,” which they sought to “protect and defend.” These
tensions between image and reality were at the heart of the disputes that
continued to emerge among SSIC leaders, NRA administrators such as
Hugh Johnson, and other members of Roosevelt’s administration.54
SSIC leaders employed manipulative depictions of labor to achieve
their policy goals. Economics and culture, from their perspective, were
too intertwined to allow for outside interference. Only southerners could
understand the delicate balance between industry and agriculture that the
region required to maintain its cultural integrity and economic prosper-
ity. On the surface, it seemed an odd turn of events. Industrialists in Dixie
had called for greater convergence with the nation. Even as one-party
politics consolidated in the late nineteenth and early twentieth centu-
ries, business leaders had exhibited “restlessness” with the Democratic
Party and sectionalism. The New Deal presented a new and formida-
ble enemy: Washington-based bureaucratic centralization loomed as a
challenge to industrialists’ ability to preserve their labor-management
disappeared among liberals in the early part of the New Deal. Southern manufacturers,
even business progressives, suspected any reform that was not associationalist –with
protections for southern wages –as dangerously liberal. Reformers might be well inten-
tioned, even misguided, but manufacturers mobilized nonetheless to maintain the South’s
industrial status quo, for all its problems. Alan Brinkley, The End of Reform: New Deal
Liberalism in Recession and War (New York: Vintage, 1996), 48–49.
54 See Irons, Testing the New Deal. Douglas Flamming argues, “The Great Depression of
the 1930s revealed clearly what southern managers and millhands had failed to recog-
nize or refused to acknowledge –that corporate paternalism could not withstand a sus-
tained economic downturn,” and the economic crisis “began to sever the bonds between
the mill and its workers.” Flamming, Creating the Modern South, 188–189. Finegold
and Skocpol identify the NRA as causing a political break between the New Deal and
business, but business could not block legislation given Roosevelt’s popularity. Finegold
and Skocpol, State and Party in America’s New Deal, 12.
3 5
Growing Distrust 53
arrangements based on social and racial hierarchies. Though southern

industrial leaders were intent on modernizing their region and reversing
agriculture’s dominance, they also sought to maintain social and cultural
continuities, such as racial preference in hiring and separate wage and
work structures for white men, women, and African Americans. Although
New Dealers tended to avoid the issue of racial discrimination in hiring
and distribution of relief, southern manufacturers were wary.55
Dixie’s defenders had political goals as well. They wanted to ensure
that the South had adequate representation in the crafting and admin-
istration of economic policy. Southern industrialists interpreted federal
efforts to address economic malaise as outside meddling and potentially
disastrous for southern political power. General Hugh Johnson, the
NRA’s appointed chief, was perhaps southern manufacturers’ friendliest
ally in the administration. Nevertheless, the SSIC quickly grew disen-
chanted with Johnson’s management. He seemed to embody the South’s
problem of lack of representation in the administration.
As an army officer, Johnson had worked with the War Industries
Board to coordinate economic mobilization during World War I, and
he promised to apply this experience in economic planning to the NRA.
As SSIC leaders began to take an active stance against the adminis-
tration of certain codes, they expressed mixed feelings about General
Johnson. Johnson’s initial welcoming attitude toward southern concerns
gave way to statements that aroused Edgerton’s suspicions about the
administration’s plans for the South. In April 1934, Edgerton reported
being “very cordially received by everybody in the NRA administration
from General Johnson down to the doorman.” They all had “expressed
themselves as being without reservation in thorough sympathy with the
objectives sought by us and in agreement as to the basic facts.” When
he called on General Johnson in May 1934, however, Johnson’s greet-
ing annoyed Edgerton. “I want to congratulate you gentlemen,” Gen.
Johnson had stated, “upon the progress the South has made under the
New Deal. In my opinion the South today is the brightest spot on the
horizon and came out from under the [D]‌epression before any other
section of the country.” Johnson’s statement placed Edgerton in a tough
spot. On the one hand, Edgerton concurred with the idea that the South
was the best place for industry in the future. On the other, he resisted the
55 Dewey Grantham, The Life & Death of the Solid South: A Political History (Lexington:
University Press of Kentucky, 1988), 61, 111. Gilbert to Comer, et al. October 16, 1934,
Donald Comer Papers 7.113.19. Edgerton to Comer, 10 August 1934, Donald Comer
Papers 7.113.19.
45
notion that the South had returned to prosperity or that the NRA, or the
New Deal, had been responsible for any recovery. Edgerton still wanted
increased exemptions for southern industry. Admitting that the NRA
proved beneficial would undermine this goal. Johnson’s willingness to
promote his own program and his penchant for overgeneralization put
Edgerton on the defensive. The SSIC president still perceived significant
challenges for southern industry, and he warned the SSIC’s constituency
that misinformation about the South circulated “in the highest circles in
Washington.”56
Edgerton suspected that administrators feigned agreement with his
concerns and that a larger agenda awaited once the New Deal sufficiently
placated intransigent southerners. Above all, Edgerton believed that the
administration advanced this hidden agenda using misinformation about
the South that had been promulgated by scheming competitors who had
been complaining about rising competition from Dixie for a decade.
Edgerton voiced his suspicion that Roosevelt’s cabinet members talked
out of both sides of their mouths. He complained, “most people now
are talking one way in public and another way in private.” Indeed, the
Roosevelt administration sought to curry favor from conservative south-
erners such as Edgerton, particularly those in business, whose cooper-
ation facilitated the NRA. Edgerton’s fears, however, tended to create
specters of jealous northern manufacturers. In his view, misinformation
from competitors seemed to flow directly to administrative bureaus in
Washington. The SSIC, he explained, could serve as educator to the mis-
informed administration.57
In July 1934, Edgerton made his case for a stronger southern voice
in crafting policy in Manufacturers’ Record, a widely read publica-
tion among southern manufacturers that had preached the New South
“creed” since 1881. Edgerton declared that there remained a “tremen-
dous job of education to do” to dispel the “delusion” that because south-
ern branches of an industry might be prospering, the South had somehow
emerged from the Depression. Edgerton’s larger concern was that rumors
of southern “recovery” would prompt more government intervention. To
counter this possibility, he emphasized the South’s distinctiveness, unity,
and the need for limits to outside intervention, come what may. “We
will rise or fall together,” he wrote, because the South “is so different, its
Edgerton to SSIC constituency, 14 April 1934; Edgerton to Comer, 9 May 1934, Donald
56
Comer Papers 7.113.19.

Ibid.
57
5
Growing Distrust 55
problems and difficulties and requirements are so distinct except as to

those genuinely fundamental things that bind us together as a nation.”
The economy’s continued plight, Edgerton argued, did not call for more
government involvement. Government intervention could too easily serve
the needs of non-southern interests.58
Despite the political power of southern representatives in Congress,
SSIC leaders feared the formation of a New Deal coalition founded on
the demands of labor. In particular, SSIC leaders warned that liberals
and union organizers would achieve a national minimum wage. Already,
NRA wage scales set by northern industry and labor, as William Anderson
explained, were “striking directly at the South.” General Johnson proved
a worrisome ally on this point. Although he had shown support for the
council’s position, Anderson noted that he had “given voice to the idea
[of a uniform wage scale],” and might not prove reliable in the future.
Indeed, Anderson told Donald Comer that he was “confidentially
advised” that during a meeting between General Johnson and a group
of industrialists at Hot Springs, Virginia, the NRA chief stated, “Industry
in the South has been built up on the degradation of southern labor.”
Such charges reflected the influence of labor leaders, SSIC representatives
argued, and ignored the benevolent role of paternalistic manufacturers
like themselves.59
William Anderson and his fellow SSIC leaders feared that other
administration officials would seize control of the NRA and promote a
plan more in line with the demands of union leaders and radical thinkers.
In the early New Deal, doubts still remained about capitalism’s future,
and proposals circulated for stronger reforms, such as the creation of a
social safety net and federal intervention in economic affairs, to constrain
the worst effects of industrial and corporate capitalism. These planners
could prove more dangerous than unwitting and clumsy figures such as
General Johnson, in Anderson’s view. Potential disaster loomed for the
South, he and others feared, if the favorite policies of Secretary of Labor
Frances Perkins and Undersecretary of Agriculture Rexford Tugwell
gained ground in the administration. Southern leaders could hobnob
and jawbone with a few jolly administrators, creating personal connec-
tions and pleading their case. If the New Deal turned away from this
58 Ibid. Edgerton, “To Protect the South from Discrimination” Manufacturers’ Record, July
1934, Reprinted by SSIC, SSIC Papers Box 3, Folder 3. Paul M. Gaston, The New South
Creed: A Study in Southern Mythmaking (New York: Alfred A. Knopf, 1970, 2002), 70.
Anderson to Comer, 2 July 1934, Donald Comer Papers 7.104.6.
59
65
more “personal” style of administration, William Anderson warned, and

embraced “bureaucracy,” the South would be at a severe disadvantage.60
Such a disadvantage under a bureaucratic federal welfare state could
produce dire consequences, according to SSIC depictions. Instead of recog-
nizing the differences between the South and other sections, SSIC leaders
charged, the NRA and the FDR administration sought to erase differences
and remake the South on a northern model or even promote the region’s
complete return to an agricultural economy. The American Federation of
Labor (AFL) and its “host of academic allies” exercised influence over
administrators, who saw an opportunity to “reform the backward South.”
Because few administrators were of southern background, Council leaders
found most of the officials who rendered decisions in code hearings to be
as ignorant as the most vilified cabinet members.61
By labeling administrators as “ignorant,” SSIC leaders disguised their
antipathy toward liberals in an attempt to “educate” the unknowing
about the true needs of the South. Secretary of Labor Frances Perkins
served as SSIC leaders’ key example of an “ignorant” cabinet member
granted inordinate power over the South. In May 1933, after touring
some southern states, Secretary Perkins suggested that stimulating the
American economy would “put shoes on the South.” Southern defend-
ers saw her statement as a slight to the South’s intelligence and civili-
zation and as revealing her witlessness. A lumberman complained to
North Carolina Senator Josiah Bailey, “It seems hard to understand that
anyone, particularly one holding an important political position, would
make such a mistake.” Edgerton linked Perkins’s statements to the larger
problems the South faced under the NRA. Edgerton complained, “the
chief difficulty is that the controlling powers in the NRA are from other
sections … and have the same misinformation and misunderstanding as
that exhibited by a distinguished member of the President’s Cabinet who
did not know until recently that the people of the South wear shoes.” If
Frances Perkins mischaracterized the South’s footwear, she and others
like her had no hope of understanding with any accuracy the region’s
complex freight rate, climate, and labor differences.62
Anderson lamented that the “ ‘personality’ feature of NRA is passing,” and predicted “we
60
are headed for the Bureaucracy type of administration. If I am correct in this, we had best
get everything we can while the getting is possible.” Anderson to Comer, 25 July 1934,
Donald Comer Papers 7.104.5.
Gilbert to SSIC constituency, 19 October 1934, Donald Comer Papers 7.113.19.
61
62 Frank Cox to Bailey, 26 May 1933, Josiah Bailey Papers, 342. Edgerton, “Address before
the Conference on Business & Industry,” 4. Gilbert to SSIC constituency, 19 October 1934.
7 5
Growing Distrust 57
Even though southern manufacturers and industrial boosters had

often supported reforms to improve public health, education, and wel-
fare among the South’s poorest residents, they exhibited little or no
tolerance of outside attention to the region’s deficiencies. Perkins’ com-
ments sparked southern manufacturers’ antipathy toward non-southern
liberals who promoted the idea of a “problem South,” even though
southern manufacturers used the idea themselves to obtain special treat-
ment for the region under the NRA. By claiming that only southern-
ers could understand the South, SSIC leaders hoped to preclude further
interference. Without a close, clear understanding of the South and its
traditions and the interrelatedness of low southern wages with condi-
tions, customs, and traditions, as Edgerton argued before SSIC members,
these (perhaps) goodhearted but misled officials would level wage rates
across regions, unionize southern labor, and disrupt natural competitive
balances.63
While Secretary Perkins’s comment about southern shoes raised the
hackles of regional boosters, no administrator garnered more suspicion
from southern industrialists than Rexford Tugwell. Before the NRA,
Tugwell supported the idea of industrial coordination and the legalization
of activities that had previously violated antitrust laws. In private, Tugwell
had voiced criticisms similar to those of southern industries, arguing that
the NRA had let big businesses outnumber small firms on code boards.
Nevertheless, SSIC leaders suspected that Tugwell was hostile to business
and industry. Several southern congressmen resented Tugwell’s promotion
to Undersecretary of Agriculture in the spring of 1934. Senator “Cotton”
Ed Smith of South Carolina led a campaign to block the appointment.
Tugwell’s agricultural policies caused the SSIC representatives to believe
the economist sought to effect a radical restructuring of the American
economy. Indeed, Tugwell believed that a “faulty institutional structure”
caused the economic crisis and that the Constitution needed updating
to fit an industrial society. SSIC leaders regarded Tugwell’s intentions as
nothing less than the upending of the American social order. SSIC leaders
often referred to Tugwell as the most offensive member of Roosevelt’s
Southern lumber and timber companies also sought exemptions from code rules, appealing
directly to the president since they did not have adequate trade association representation to
argue at the code board level. The president denied the petition from H. A. Taylor of Greensboro
Lumber Company in October 1933. Executive Order #6346, Public Papers of the Presidents of
the United States: F.D. Roosevelt, 1935, Volume 4 (New York: Random House, 1938), 541.
63 Natalie Ring, The Problem South: Region, Empire, and the New Liberal State,
1880–1930 (Athens: University of Georgia Press, 2012).
85
administration, using him as a symbol for all that was wrong with the
New Deal’s approach to economic planning.64
Centralized economic planning, southern manufacturers feared,
threatened small-scale, specialized manufacturing in favor of commod-
ity production and export. Donald Comer warned John Edgerton that
one of Tugwell’s colleagues, economist Mordecai Ezekiel, made sev-
eral alarming comments about the South. Ezekiel had suggested that
the South reduce its production and import more paper from Norway,
thus providing an opportunity to balance paper imports with exported
cotton. Comer believed the two administrators were happy to sacrifice
minority southern industries in the quest to achieve broader goals. Comer
grumbled that the paper idea “is just a fair sample of what Ezekiel and
Tugwell would like to hand the South.” Edgerton responded in kind, tell-
ing Comer, “That man Tugwell gives increasing evidence of being a public
menace. You show him up in your letter to be about as morally unsound
as he is economically.”65
SSIC leaders argued that the FDR administration was increasingly led
by conniving Tugwells rather than bumbling Johnsons. “But from my
contacts with those in Washington who are engaged in manufacturing
the new social order,” Edgerton concluded to Comer, Tugwell represented
the more “typical characteristics” of Roosevelt’s advisers. The only dif-
ference among cabinet members was in their “degrees of radicalism.” As
he explained their motives, “Except for a few powerless individuals who
have been called in to give respectability to and confidence in what is
being done, they are all driving toward the same destructive end and
that is the ultimate federalization of the processes of production and dis-
tribution.” Edgerton argued that economists and administrators such as
Tugwell and Ezekiel would destabilize the South, economically, morally,
and spiritually. Antistatist sentiments, by the summer of 1934, were on
the rise among SSIC leaders and members.66
Some prominent SSIC members suggested even more hostile theories
about the New Deal. Among them was the elderly Ellison Smyth, who
had built South Carolina’s Pelzer Manufacturing Company, one of the
largest cotton textile manufacturers in the South, with mills housing
64 Smith’s primary objection to Tugwell, reportedly, was that Tugwell was “not a dirt farmer.”
Bernard Sternsher, Rexford Tugwell and the New Deal (New Brunswick, NJ: Rutgers
University Press, 1964), 155, 162, 253.
Comer to Edgerton, 14 August 1934; Edgerton to Comer, 14 August 1934, Donald
65

Ibid.
66
9 5
Growing Distrust 59
around 136,000 spindles. Along with other textile manufacturers, Smyth

insinuated that the Department of Agriculture falsely assessed the cost of
the Agricultural Adjustment Act’s (AAA) processing tax to manufactur-
ers. He concluded that the administration aimed for nothing less than a
complete reorganization of the southern economy. Smyth was convinced
that administration members deliberately clouded facts to advance a
politically motivated agenda to restore the South as a primarily agricul-
tural region.67
Politics were never far from economic considerations. Members of
FDR’s brain trust, Smyth believed, targeted the South unfairly because
of its conservatism. Not only were New Deal planners acting on poor
information, industrialists charged, but the NRA’s outcome might
harm the cotton farmers who supplied manufacturers with their raw
material. These southern businessmen, irked that they had set aside
ideological and political concerns to cooperate with the NRA, planned
to protest New Deal proposals they believed might weaken or erad-
icate southern industry. Certainly, Smyth rightly attributed politi-
cal motivations to New Deal administrators and FDR, who sought
to triangulate southern Democrats into a New Deal coalition. The
key issue for southern business leaders remained the preservation of
autonomy.68
SSIC leaders avoided direct conflict with New Dealers by pointing
to northern competitors as the source of the South’s problems with the
NRA. Throughout 1934, SSIC leaders charged northern competitors
with malicious intent toward southern prosperity –a danger that grew
given their power with Washington insiders. Leaders hoped that if the
SSIC could serve as the voice of the South’s industrial future, the helpful
aspects of the NRA might be preserved. These leaders believed that north-
ern competitors, particularly in textiles, resented the rise of the South as
an alternative location for manufacturing. Furthermore, northern and
eastern domination of code boards represented the overwhelming power
of large industrial companies over small and medium-sized competitors
in the NRA –a condition that doubly disfavored the South, SSIC leaders
Ellison Smyth to Josiah Bailey, 2 February 1935, Josiah Bailey Papers 344.

67
68 Ibid. Smyth had a long history of clashing with populists, and had clashed with Benjamin
“Pitchfork” Tillman when his supporters tried to extend support to mill workers. Smyth
rebuffed charges that he fired workers for political activism, and supported conservative
politicians in North Carolina. Archie Vernon Huff, Greenville: The History of the City
and County in the South Carolina Piedmont (Columbia: University of South Carolina
Press, 1995), 229–230.
06
argued. These conditions, they maintained, hearkened back to the dark

days of defeat during Reconstruction.69
Strident SSIC rhetoric against the NRA and New Deal did not go
unnoticed in the southern press. The organization quickly established a
reputation in the South and in national policy circles. The Birmingham
News reported that the council’s general tenor at an organizational meet-
ing characterized the NRA as a second “March to the Sea.” SSIC repre-
sentatives used “misinformed administrators” as code for liberals intent
on raising southern wages. Competitors, industrialists warned, were dia-
bolically exacerbating the South’s poor industrial reputation in order to
keep industry concentrated in the Northeast. The consequences would
be, Edgerton concluded, referring to the South under Reconstruction,
that southern industrialists would soon find themselves “again compelled
to eat the crumbs that drop from the tables of our richer neighbors.”
H. J. Penn, president of Gem-Dandy Garter Company, a North Carolina
manufacturer subject to the Suspender and Belt Code, expressed a sense
of having been granted a “stay of execution” when his code authority
placed a hold on revisions to their wage differential until a hearing could
be held. The men on Penn’s code authority, he reported, told southern
suspender and belt manufacturers, “You are Geographically mis-located.”
An executive order denied Penn’s petition for exemption from his indus-
try’s code in September 1933, and the manufacturer turned to the SSIC
for help. Penn’s early resentments, and those of southern manufacturing
sectors that did not have representatives on code boards to argue for
southern differentials, prompted the creation of the SSIC.70
Conclusion
Franklin Roosevelt saw the NRA as a way to integrate (and ingratiate)
corporate leaders into the New Deal. Business executives organized
to harness the NRA to achieve long- standing anticompetitive goals.
When it came to economic recovery, SSIC leaders cooperated with the
NRA and preferred it to a national minimum wage, but they preferred
Gaston, The New South Creed, 13.

69
70 “NRA Likened Here to ‘March to Sea’.” Birmingham News, 18 April 1934. Edgerton to
SSIC constituency, 14 April 1934, Donald Comer Papers 7.113.19. “[Our competitors]
are against us,” Penn continued, “for the simpler reason that we are practically the only
one of any consequence who manufacture in the South.” H. J. Penn to Bailey, 26 April
1934, Josiah Bailey Papers, 167. Executive Order #6296, September 18, 1933, Public
Papers of the Presidents of the United States: F.D. Roosevelt, 1935, Volume 4, 538.
1 6
Conclusion 61
microeconomic solutions for the South’s economic woes. While they

acknowledged that southern industry suffered from destructive compe-
tition, they sought to maintain and advance southern competitive advan-
tage by protecting and promoting industries where the South could be
competitive and develop in a localized, specialized, and individualized
manner. Southern factories would process the region’s abundant natural
resources, turning lumber into furniture, spinning harvested cotton into
simple garments or sheeting, and fabricating transportation equipment
to ship southern-made goods to other markets. Southern manufactur-
ers’ vision of decentralized industry, refining and processing the region’s
raw materials, dominated prescriptions for political economy, but was
masked as attempts to preserve southern “civilization.” Naturally, these
men (and they were mostly men) wanted to preserve their positions of
social and political power, but they also saw this power as the key to
preserving low-wage labor.71
Although NRA planners targeted the South’s low-wage labor system,
southern manufacturers proved savvy in both their management and
political responses. Southern firms maintained enough flexibility because
of widespread unemployment to avoid the NRA’s weak and haphazard
oversight. Many firms sidestepped regulations by cutting hours. Workers
thus tended to see only modest increases in take-home pay as hourly
wages increased. Even with such workarounds, the SSIC’s arguments
grew more antistatist as the NRA began to crumble under congressio-
nal scrutiny and judicial review. Still, southern economic exceptionalism
shaped SSIC leaders’ approach to congressional leaders, particularly
given the rapidly changing policy environment. As President Roosevelt
addressed the NRA’s problems in 1934 and recommended reorganiza-
tion, SSIC representatives clung to the Blue Eagle as their best hope to
exempt the South from more “meddlesome” legislation, even if it had sig-
nificantly “reduced the operating advantage that the South has enjoyed
over New England.” Southern industrialists looked to southern legisla-
tors to protect Dixie’s industries’ interest in solidarity as southerners.
Manufacturers worked within the New Deal, but their concerns mounted
71 In this manner, southern industrialists shared concerns, at least in identifying the con-
centration of power in northeastern capital as dangerous, with progressive reformers,
effectively embracing an associationalist method to maintain decentralized industry, a
characterization that applied particularly to textiles –although southern manufactur-
ers were primed to see their industries and wages as vulnerable within any centralized
bureaucracy. Brinkley, The End of Reform, 5, 58–59.
26
that economic planning threatened the South’s wage structure and the
region’s future development.72
From the SSIC’s beginning, the organization’s founders hinted that
their underlying goal was to promote free markets, prices set by sup-
ply and demand, and to augment their ability to make products more
cheaply and efficiently. In private conversations, they made it clear that,
if necessary, they would seek to achieve these goals without the support
of the Democratic Party. Early in 1934, just a few months after founding
the SSIC, John Edgerton wrote to Donald Comer that he saw signs that
“our people” –meaning southern industrialists –were “awaken[ing]”
to the idea that “they can’t merely rely on the Lord and the grand old
Democratic party to take care of them.”73
Yet Edgerton and his allies remained cautious. Business bore the brunt
of the blame for the Depression, and southern manufacturers found few
allies in Washington, DC. Though they were open to political alliances
that would achieve their ends –by retaking the Democratic Party from
its growing northern, urban base, fostering the growth of the GOP in the
region, or developing a third party –they pursued policy advocacy with
care, first lining up allies, issue by issue. Other than a vague vision for
southern industrial development, the SSIC offered no practical alterna-
tive to address economic problems; as such, the organization prioritized
cultivation of political ties to alter existing policy or to exploit as new
proposals arose. The SSIC leaders believed that they could still influence
the Democratic Party, even as it began to reflect the concerns of north-
eastern constituencies and labor. To combat that trend, the SSIC doubled
down on sectionalism.
72 Wendy Wall, Inventing the “American Way”: The Politics of Consensus from the New
Deal to the Civil Rights Movement (New York: Oxford University Press, 2008), 49.
Comer to Anderson, 4 March 1935; Comer to Anderson, Cannon, Marchant et al. 5
March 1934, Donald Comer Papers. 7.116.2. H. P. Taylor to Bailey, 12 March 1935,
Josiah Bailey Papers, 168.
Edgerton to Comer, 26 March 1934, Donald Comer Papers 7.107.5.
73
3 6
Southern Industry and the Southern Region
On March 6, 1935, the D&W Shirt Company closed its doors, seemingly
for good. D&W provided the majority of the industrial jobs in Lowgap,
North Carolina, a township in the Blue Ridge Mountains near the
Virginia border, halfway between Galax, Virginia, and Mt. Airy, North
Carolina. Truman Woodruff, D&W’s president, cited NRA-mandated
minimum wages and maximum hours as the reason for the closure. He
protested that setting a thirty-six-hour workweek and a 10 percent wage
increase in the garment industry was the “straw” that broke his facto-
ry’s back. Already struggling under the declining profits of textile work
reaching back to the 1920s, he complained that the “High Ups” in each
industry “could see no interest save their own, and the blessed welfare of
New York and up North.” Their goal, he continued, was to “whip little
business.”1
Woodruff began his business as a merchant of locally grown Galax
leaves. He had built his business and expanded into apparel manufac-
turing, hiring far more workers at his mill than he had picking leaves to
sell. Before the Depression, D&W employed approximately eighty-five
women and sixty men. The company downsized and adapted its produc-
tion of work shirts in response to the Depression. With these arrange-
ments, the shirt company had managed to employ sixty-five women and
eight men at a “living wage” for fifty-five hours per week. Woodruff
1 T. N. Woodruff to Bailey, 16 April 1935, Box 345, Josiah Bailey Papers, Duke University
(hereafter cited Josiah Bailey Papers, box number). Declining profits in textiles during the
1920s had led to the development of an alternative trade association, the Cotton Textile
Institute. Galambos, Competition & Cooperation.
63
46
64 Southern Industry and the Southern Region
considered his wages and hours “fair,” given the destitution from which
his predominantly white workforce had emerged. Most workers had nei-
ther skills nor background in industrial work. He described his plight,
and the position of his workers and company:
Here we are (or rather were) in a little country community, away up in the moun-
tains, where people can live well and comfortably on less than half what the city
employee can, and we are forced to pay just as much per hour as the plant located
in Richmond, Nashville, or Atlanta, and have the additional expense to truck our
raw material and our finished product to and from the railroad, 15 miles away,
over a rough unimproved dirt mountain road, and these employees naturally
slow in the head and hand, cannot now, nor never would be able to turn out more
than two thirds as many garments per hour as the quick, alert, raised to it, and
trained to it, town and city reared employee.
Woodruff, like many other southern industrialists, cast himself as the pro-
tector and benefactor of his employees and community, a role he argued
was under assault from the NRA and northern competitors.2
Although the codes helped stop the downward spiral of wages and
prices, criticism grew among small businesses, consumers, labor circles,
as well as southern manufacturers. Complaints from small businesses and
manufacturers formed the core of the protest to the NRA –Woodruff
was not alone. Southern manufacturers, however, voiced specific criti-
cisms based on the South’s particular economic conditions and history.
Northern plants, they complained, had grown in the nineteenth century
under tariff laws protecting them from competition abroad; southern
plants were late to develop, and their only advantages were cheap labor
and access to raw materials. Northern business, Woodruff and others
argued, sought to put the “squeeze” on upstart neighbors in Dixie, and
Washington policymakers provided the means to threaten southern
industry.3
The South received such attention not just because per capita income,
in many areas, was half the national average, but because the region’s
economy differed in structure from the rest of the nation. In many
ways, Dixie’s economy was exceptional, but not in the sense of it being
2 Woodruff to Bailey, 16 April 1935.

3 Ibid. Woodruff’s company later reopened long enough to pay dues to the council in 1936,
and was listed as employing between thirty-five and forty workers in the North Carolina
industrial directory in 1938. North Carolina Department of Environment and Natural
Resources, Industrial Directory and Reference Book of the State of North Carolina,
1938 (Durham, NC: Christian Printing Co., 1938), 40, in North Carolina Digital State
Documents Collection, PDF, OCLC 6153387, North Carolina Digital Collections, North
Carolina Department of Natural and Cultural Resources, http://digital.ncdcr.gov.
5 6
Southern Industry and the Southern Region 65
enviable. Extractive, cash-crop agriculture, exacerbated by sharecropping

and tenant-labor systems, had depleted the soil and worsened conditions
for southern farmers. Few rural areas had access to electricity, and exist-
ing power sources tended to be costly. Many cultural observers surmised
that the South had been left behind by modernity –a fate exemplified by
the Scopes “Monkey” trial of 1924 that showcased southerners resist-
ing modern science. Such issues, including the long-standing problem of
rock-bottom commodity prices and overproduction, loomed large in the
minds of New Deal planners as they drew up the AAA, TVA, and plans
for rural electrification, to bring rural southerners and farmers into the
consumer economy.4
Southern defenders of differing stripes bristled at the notion of out-
siders ministering to the region’s problems. In the 1930s, SSIC leaders
envisioned a broad coalition of support for their program against federal
interventions in the southern economy. In the depths of the Depression,
any number of improbable alliances seemed possible. The weaknesses
and failures of various efforts to save “rural civilization” by prominent
intellectuals brought about unexpected associations among advocates for
southern decentralization and economic experimentation. As this chapter
demonstrates, SSIC leaders tried to build a wide coalition of guardians
of the South, but cooperation foundered on divergent interpretations of
the NRA, the New Deal, and visions for the region’s future. In particular,
as NRA challenges grew, SSIC leaders found themselves defending the
program from fear of what would replace it if it were scrapped. SSIC
leaders asserted the idea that their profits were secondary to their desire
to preserve the “southern way of life.” This position grew more farcical
as their antipathy toward the New Deal grew, yet this rhetoric remained
a political imperative in order to maintain alliances with representatives
in Washington.
The SSIC politicized the cultural commitments of southern traditional-
ists more effectively than the intellectuals, poets, and writers at Vanderbilt
University, the so-called Agrarians. At the same time, SSIC leaders had to
choose when to court or alienate potential allies –whether they were
Democrats and New Dealers, industrialists who defended agricultural
policies, or critics of industrial life. The SSIC’s official positions translated
justifications of economic arrangements into cultural and ideological
4 A variety of southern intellectuals also confronted the tensions between modernism and
the “New South creed” in this period. See Daniel J. Singal, The War Within: From Victorian
to Modernist Thought in the South, 1919–1945 (Chapel Hill: University of North Carolina
Press, 1982).
6
terms. Results were mixed, and SSIC leaders had to settle for clarifying
what groups could be counted on to prevent further reforms.5
The SSIC and Southern Intellectuals

Southern liberals, such as Howard Odum and the social scientists at
his Institute for Research in Social Science at the University of North
Carolina at Chapel Hill, founded in 1924, confronted the region’s lack
of education, racial caste system, and poor quality of life. Regionalism,
Odum’s multidisciplinary framework, advocated social and economic
improvement by rejecting sectionalism and coordinating cooperation
through large- scale planning and understanding of geographical and
social diversity. At times, industrial representatives, prominent liberals,
and academics met to confront the South’s problems, although these
groups offered vastly divergent approaches and solutions. The idea of a
“problem South” had long been a point on which southern liberals, as
well as outsiders interested in the region, could agree. This group tended
not to include industrialists.6
Southern manufacturers’ commitment to maintaining a hierarchical
social order placed them in the traditionalist camp, though industrial-
ists shared some affinities with progressive and liberal reformers such
as Odum’s social scientists. The SSIC’s plan for economic development,
in bare outline, appeared similar to Odum’s regional planning, which
sought to “balance between the new and the old, the rural and the urban,
the agrarian and the industrial, the folkways of the people and the tech-
nicways found by new advances in science.” While the SSIC never pub-
lished a vision or plan for economic development, in numerous public
statements and appearances by leaders and invited speakers the organi-
zation communicated the vision of decentralized industry. This version
of decentralization focused on preserving the industries that processed
southern raw materials close to their source, whether cotton fibers,
iron ore, or harvested timber, as well as on the building of new types of
industries in the region that produced consumer goods to market close
to home. As one SSIC founding member, a shoe manufacturer, explained,
“Our market is the agricultural West and South –as they prosper, we
5 Shaffer, In Restraint of Trade, 13–15.

6 For a comprehensive study of regionalism, see Michael C. Steiner, Regionalists on the
Left: Radical Voices from the American West (Norman: University of Oklahoma Press,
2015). Notably, Natalie Ring connects discussion of the South’s problems with the devel-
opment of U.S. imperialism in the global South. Ring, The Problem South.
7 6
The SSIC and Southern Intellectuals 67
prosper. We have encouraged decentralization of industry –the movement

of industry into rural sections has been sound and wholesome.”7
Divisions over industry’s effect on agriculture, as well as continued
inequities in education and wages, prevented the emergence of a common
southern voice. As one historian explained, “Odum departed from the
New South line by portraying the southern social order as fundamen-
tally defective.” The social order, for New South manufacturers, ensured
a constant source of cheap labor and the stability of racial and class hier-
archies. Although Odum and southern manufacturers both occupied elite
positions in the region, possibilities for alliance were slim. Industrialists
embraced sectionalism whereas Odum rejected it. Odum viewed the
industrial leaders with skepticism, and “he suspected that their ultimate
role in southern history would not be as agents of advancement, but as
allies of conservatism.” Yet, other possibilities for alliance emerged, if
fleetingly.8
SSIC leaders expressed similar cultural values as those espoused by
the Agrarians. These writers, artists, and social scientists at Vanderbilt
University in Nashville criticized industrial capitalism and celebrated
7 R. E. Blake to Josiah Bailey, 10 October 1933, Josiah Bailey Papers, Box 167. Harvey Kantor
suggests that conservatives and liberals seemed to be housed in Vanderbilt and UNC,
respectively. Harvey A. Kantor, “Howard W. Odum: The Implications of Folk, Planning,
and Regionalism,” American Journal of Sociology 79, no. 2 (September 1973): 284–285.
Traditionalists, such as the Agrarians and in particular Donald Davidson, clashed with
the progressive sociologists. For Davidson, southern traditionalists were “conservative,
religious, possessed of a historical sense, and given to the sacredness of the individual and
a sense of place” and favored segregation; sociologists, and Odum, were, to Davidson,
“progressive, scientific, and ahistorical, and [Odum] had little regard for the integrity of
the place of the individual.” Sociologists also favored integration, and traditionalists were
wary that they saw the South “as a gigantic laboratory for social experimentation” in the
1920s and 1930s. Fred C. Hobson, Tell About the South: The Southern Rage to Explain
(Baton Rouge: Louisiana State University Press, 1983), 181. Manufacturers preferred to
maintain the status quo because it delivered a stable labor force without access to social
or political power.
8 See Ring, The Problem South. Singal, The War Within, 124, 125. Industrialists differed
from social scientists and liberals over how to address social problems. Industrialists,
for many reasons, insisted on pursuing development first, including the introduction
of synthetics and other replacement fibers to cotton, and sorting out the ramifications
later. These ideas were discussed at a symposium at Duke University in November 1938,
attended by Secretary of Agriculture Henry Wallace, The Progressive Farmer editor
Clarence Poe, and CTI leader Claudius Murchison along with Odum. Odum presented
his paper, “Toward a Balanced Regional and National Economy,” folder 629, Howard
Washington Odum Papers, 1980–1982. The Southern Historical Collection at the Louis
Round Wilson Special Collections Library, University of North Carolina–Chapel Hill,
Coll. No. 03167. Symposium details printed in “Southern Economic Problems Discussed
in Symposium,” Duke Alumni Register, November 1939, 301.
86
the agrarian-rooted culture of the South, notably defended in the 1931

collection of essays, I’ll Take My Stand, which constituted a traditionalist
southern manifesto even if it was not clear if the contributors spoke for the
old planter elite or the “plain white farmer.” In this group the SSIC found
champions of the traditional values that manufacturers’ claimed to embrace.
The SSIC sought allies who were committed to the idea of progress while
preserving certain aspects of what they called “southern civilization” and
the southern “way of life.” The SSIC believed that a healthy industrial sec-
tor could provide a backbone to preserve the kinds of values the Agrarians
sought to defend, although the Agrarians would have disagreed.9
Business leaders thus straddled the sectionalism and cultural conser-
vatism at Vanderbilt and the programmatic, practical response of the lib-
erals at Chapel Hill. Though many SSIC leaders and members qualified
as progressives or even New Dealers, given their tepid support of the
NRA, the organization advocated a conservatism grounded in political
pragmatism and a sense of what policies would enhance southern eco-
nomic development. At the same time, SSIC leaders distanced themselves
from national business leaders and associations, embracing ideas about
the South’s separate history and economy and claiming to value preser-
vation of the social status quo over the pursuit of profits and industrial
expansion.10
9 Hobson, Tell About the South, 213. Warren never linked Agrarianism with New Deal
criticism. Emily Bingham and Thomas A. Underwood, eds., The Southern Agrarians
and the New Deal: Essays After “I’ll Take My Stand” (Charlottesville: Published for
the Southern Texts Society by the University Press of Virginia, 2001), 4, 6–7; Donald
Davidson, Regionalism and Nationalism in the United States: The Attack on Leviathan
(1938 reprt., New Brunswick, NJ: Transaction Publishers, 1991); Twelve Southerners,
I’ll Take My Stand: The South and the Literary Tradition (1930, rept., Baton
Rouge: Louisiana State University Press, 1977).
One could say that the Agrarians, the South’s most prominent traditionalists and section-
10
alists in the 1930s, harbored a stronger antistatism than manufacturers did: these groups
shared a distaste for the hegemony of the State, but traditionalists feared the cultural
implications of capitalism whereas industrialists were bourgeois and capitalist. Yet the
SSIC, like other southern defenders, was not only defensive, it also attempted to “negoti-
ate the South’s entry into the national hegemony on different terms than that hegemony
was offering,” yielding the set of modern paradoxes that continue to confront those who
consider southern history as told by traditionalist conservative and free-market purvey-
ors. Gaps between traditionalists and industrialists lessened as modernity encroached
on the South and the specters of a growing bureaucratic state (with integrationist
impulses) and global communism created common cause. Paul A. Bové, “Agriculture
and Academe: America’s Southern Question,” boundary 2, Vol. 14, No. 3, The Legacy of
Antonio Gramsci (Spring, 1986): 174–175, 177. SSIC leaders had more in common with
southern progressives such as Edwin Mims at Vanderbilt, who saw himself as a kind of
“press agent” to revive the South’s tarnished image after the 1920s, than they did with
9 6
Beyond Nashville and Chapel Hill, SSIC leaders’ mission to preserve

southern civilization built on concurrent efforts among prominent leaders
in the South and mingled with several strains of interwar cultural move-
ments. Council leaders looked to build a community of public figures who
wanted to improve the South’s economic prospects and maintain what
they perceived as the region’s peculiar advantages and unique character.
Other prominent figures were also seeking to better the South, though
not via commodities-intensive industrial development. Regionalism, a
movement among social scientists, writers, and artists, took many forms
in the South by the 1930s. Some presented potential avenues of develop-
ment and cooperation for southern industrialists and their metropolitan
or economic development plans, while others celebrated rural life. Such
concurrent developments helped the SSIC and its leaders define a cultural
mission for the organization as well as a defense of industry, even if no
political collaborations emerged.11
Hugh MacRae, a North Carolina engineer, businessman, and philan-
thropist, corresponded often with council leaders. His association with
South Carolina seed manufacturer and SSIC inner circle member David
Coker grew stronger through participation in the Southeastern Council,
which at the time of the SSIC’s founding was founding a Rural Life pro-
gram. MacRae aimed to diversify southern agriculture to attain social
betterment for farmers. He believed prosperity and scientific achievement
would serve humanitarian goals, resembling earlier progressive solutions
to southern poverty. He preferred voluntary and philanthropic sources
of relief over government programs funded by taxation. MacRae also
used the language of southern “civilization” to explain and justify his
economic program. He articulated “Four Essentials to Civilization” that
would ease southern economic woes; these included the development
of homegrown industry, abolishing the tenant system in agriculture,
Odum, who, as Hobson explains, appeared as the South’s “diagnostician and healer” and
who recommended “rigorous planning.” Hobson, Tell About the South, 184–190.
George B. Tindall explained, “For a decade [prior to 1931] regionalism had occupied the
11
pages of literary journals and had been implicit in the publication of ‘little magazines’
of regional import both in the South and elsewhere; it became the subject of discussion
among geographers, anthropologists, economists, political scientists, and sociologists;
it was attracting more technical consideration under the heading of ‘regional planning,’
although this usually meant metropolitan planning first.” Howard Odum attempted to
found the Council on Southern Regional Development, but failed. George Tindall, “The
Significance of Howard W. Odum to Southern History: A Preliminary Estimate,” Journal
of Southern History 24, 3 (August 1958): 294, 299. See Robert L. Dorman, Revolt of
the Provinces: The Regionalist Movement in America (Chapel Hill: University of North
Carolina Press, 1993).
07
diversifying agriculture and orienting crops to local needs, and cultivating

a cultural and intellectual “awakening.” For contemporary defenders
of southern social patterns, preservation of the “southern way of life”
tended to translate into preservation of competitive advantage, and, for
some, keeping a “humane” and local-based society, even if the reality
for workers differed from the representations of these self-appointed
guardians.12
SSIC leaders and social reformers shared a remarkably similar affinity
for preserving southern “civilization,” but the means of preservation and
trajectories of development they envisioned proved to be quite different.
MacRae’s Penderlea colonies were an experiment in communal living
funded by generosity and –its leaders hoped –an infusion of support from
the federal government that supported local autonomy. In March 1934,
Penderlea was coming under federal control, weakening MacRae’s alter-
native vision. As MacRae noted to an SSIC director in South Carolina,
Penderlea was undergoing an “overdose of federalization” from the
Division of Subsistence Homesteads, the agency under the Department of
the Interior tasked with resettling struggling farm workers, unemployed
urban dwellers, and destitute workers from hard-hit industries. By May
1934, MacRae had resigned as manager of Penderlea and left control of
the project to the Division of Subsistence Homesteads.13
The timing of Penderlea’s woes proved beneficial for the SSIC. Still
committed to southern “civilization” as an overriding goal alongside pro-
moting a beneficial relationship between agriculture and industry, SSIC
leaders Donald Comer and David Coker began to doubt that MacRae
could offer an alternative for poor southerners. The failure of Penderlea
and other communal approaches to a solution for Depression-induced
poverty seemed to support the indictment of federally directed efforts
for relief and reform. David Coker, whose family had made its fortunes
in developing cottonseeds with the Coker Pedigreed Seed Company,
Hugh MacRae, Wilmington, NC, 17 October 1934, in David Coker, item 152 (1934–
12
incoming). James Lide Coker Papers, 1800–1947, South Caroliniana Library, University
of South Carolina, Columbia, TN. Hereafter cited David Coker Papers.
MacRae to Coker, 7 August 1934, Wilmington, NC, item 119 (1934–incoming), David
13
Coker Papers. See Paul E. Mertz, New Deal Policy and Southern Rural Poverty (Baton
Rouge: Louisiana State University Press, 1978); Ann Cottle and University of North
Carolina, Wilmington, The Roots of Penderlea: A Memory of a New Deal Homestead
Community (Wilmington: Publishing Laboratory, Dept. of Creative Writing, University
of North Carolina Wilmington, 2008); Thomas Everett, “Penderlea, an Experiment
in Community Education” (Ph.D. Dissertation, University of North Carolina, Chapel
Hill, 1942).
1 7
was primarily interested in preserving agriculture. But with Penderlea’s

troubles, he looked to the SSIC as a potential representative for the proper
balance of agriculture and industry. Together with Donald Comer, these
two prominent industrialists helped legitimize and promote the organi-
zation in industrial circles as a defender of the South’s economic and
social future. Even though they differed with many SSIC leaders over
agricultural reform, developments within their community of reformers
and elites bolstered the manufacturers’ organization.14
Additionally, strange congruencies between the SSIC’s rhetoric and
Agrarian Donald Davidson’s warnings about the New Deal emerged.
In the summer of 1933, before the SSIC launched its mission to limit
the New Deal, Davidson, referring to the administration’s programs for
recovery, remarked that “most of our saviors do not bother to include
sectionalism in their programs. They are under the delusion that the
United States are a compact and well unified body, neat and coherent
as a European state.” SSIC leaders sought to have such regional differ-
ences recognized by recovery measures, and they mirrored Davidson’s
concerns that the New Deal privileged one section over another. These
voices remained divided despite a common interpretation of Roosevelt
and the New Deal. Davidson criticized the “semblance of unity which the
industrial apparatus has set up,” meaning that he did not recognize the
SSIC’s insistence on the separateness of the southern economy and saw
manufacturers’ cultural commitments as hollow, merely masking efforts
to exploit southern labor.15
SSIC leaders and the conservative Agrarians agreed that the South’s
economic woes stemmed from the “bitter harvest of Appomattox,”
which the North continued to exploit. In seeking an industrial South, the
SSIC founders might have been seeking the “wrong kind of unity” with
national trends that Davidson feared. Though their vision for the South’s
economic future differed, SSIC leaders and Davidson agreed that it should
be separate from the nation’s. Politically, they concurred as well that the
“national program” privileged one region over another. Davidson and
southern manufacturers agreed: the South’s future depended on main-
taining social and racial hierarchies.16
14 Paul Conkin, Tomorrow a New World: The New Deal Community Program (Ithaca,
NY: Published for the American Historical Association by Cornell University Press,
1959), 278.
Donald Davidson, “Sectionalism in the United States,” in Bingham and Underwood, The
15
Southern Agrarians and the New Deal, 51.

Ibid., 61.
16
27
Modern southern conservatism of the mid-twentieth century did not

coalesce because of the discovery of some deep affinities and views of
southern traditional culture, as if such beliefs came from the southern
soil itself: its proponents aligned because of the development of similar
interpretations of how New Deal policy would affect the South, both cul-
turally and economically. Yet in the 1930s they remained utterly divided
by their views on capitalism, and it would take the rise of the threat of
expansionist communism to bring them together.
In concrete terms, the SSIC’s vision differed from the Agrarians’ in that
manufacturers, naturally, saw industry –and a particularly southern brand
of managerial capitalism –as the only potential savior for the South. And the
SSIC held more influence in the political arena than poets and writers did,
despite the poor reputation of business in the Depression, though Davidson
shared the SSIC’s distrust of leftists, socialists, and communists. For the most
part, his aversion to industry drew from fear of the plutocracy he claimed to
observe north of the Mason-Dixon Line. The Agrarians proved too fractured
in their specific recommendations during the New Deal to mount a political
movement, but they did advocate “a political order in which moral and reli-
gious values take precedence over ever changing governmental policies.” The
gap between Agrarian and industrial programs was too wide to bridge in the
1930s, though the SSIC’s headquarters were located in downtown Nashville,
less than three miles from the Agrarians’ Vanderbilt sanctuary.17
Chief among the SSIC leaders’ self- prescribed duties, along with
promotion of industrialization, was to correct notions that the South
should remain an agricultural region. Southern industrialists suggested
that the Roosevelt administration was paying off northern industry at
the expense of southern interests and thereby attempting to keep Dixie
primarily agricultural. At the SSIC’s February 1934 organizational
meeting of approximately one hundred industrialists in Birmingham,
Alabama, George H. Armistead, editor-in-chief of the Nashville Banner,
praised the gathered group and affirmed the South’s industrial heritage.
Armistead argued that the South progressed so rapidly “that we do not
catch, perhaps, its full meaning and mission.” Industrial progress, he told
the group, was sweeping away mistaken views about the South that had
hampered regional development. These erroneous views included belief
in the South’s innate agricultural character. “Misrepresentation and igno-
rance,” Armistead complained, “are responsible for the impression so
Ibid., 16. Paul V. Murphy, The Rebuke of History: The Southern Agrarians and American
17
Conservative Thought (Chapel Hill: University of North Carolina Press, 2001).

3 7
widely prevalent among the youth of the South today that the Old South
was a land of statesmen and orators, but that it was bereft of business
leadership, that it lacked creative genius and industrial vision.” Armistead
moved to set the record straight. The South emerging in the 1930s was
not “new”; it was a renaissance of the region’s early industrial origins.
He claimed the region as a pre-Revolutionary pioneer of industrial devel-
opment. Armistead christened the council’s vision for industrial develop-
ment, declaring that the SSIC was reinvigorating economic growth that
had been derailed by the Civil War.18
For Armistead and the southern industrialists gathered in Birmingham,
the South’s “stability and vitality” depended on carving out special pro-
tections for southern industry within legislation and limiting the further
expansion of reform (namely federal sanctioning of collective bargain-
ing). Similar to the Agrarians, these industrialists embedded their section-
alism within nationalism. The SSIC’s vision for the southern economy
included economic independence, agricultural and industrial coopera-
tion, and diversification in manufacturing. Diversification and the SSIC’s
industrial vision, as represented by Armistead, reinforced southern indus-
trialists’ call for a wage differential to protect regional values, traditions,
and economic prosperity. The South as an economic unit had a negative
trade imbalance with other sections, he argued. Only a structural realign-
ment between agriculture and industry could solve the region’s deficit.
“Diversification is the golden key to progress and stability,” Armistead
declared.19
SSIC leaders portrayed preservation of wage differentials as tanta-
mount to the preservation of southern civilization, a blending of cultural
and economic imperatives. Nevertheless, John Edgerton and his cohort
still faced the task of securing practical solutions for the problems of
southern industry and dealing with the troublesome NRA. Edgerton’s
concern, moreover, only continued to rise as 1934 drew to a close.
Despite having called the NRA a failure, Edgerton, Donald Comer, and
other council leaders publicly supported the extension of the NRA with
certain “reasonable” modifications to protect the South. Privately, they
voiced significant concerns. Their support of revision and renewal of the
NRA rested on the question: If not the NRA, then what?
George H. Armistead, “Address at the Meeting of the Southern States Industrial Council,”
18
Birmingham, Alabama, 26 February 1934. SSIC pamphlet, SSIC Papers Box 3, Folder 2.
Ibid.
19
47
The NRA Revision Debate

Roosevelt’s Fireside Chat of September 30, 1934 launched a series of
disappointing events for the South’s defenders. In the address, Roosevelt
proposed to reorganize the NRA and endorsed shorter hours, minimum
wages, and collective bargaining for workers. In particular, industrialists
feared an expansion of the NIRA’s Section 7a, which allowed for the lat-
ter. The reorganization agenda included replacing Johnson as NRA chief,
making codes simpler and less monopolistic, and strengthening protec-
tions for small business, labor, and consumers. FDR targeted noncompli-
ant employers who did not live up to the spirit of the law. He declared
that an employer who “denies freedom of organization to his employees,
or fails to make every reasonable effort at a peaceful solution of their
differences, is not fully supporting the recovery effort of his government.”
Roosevelt presented a bold challenge to opponents of his programs for
reform. The debate over the NRA’s future, as the program grew increas-
ingly unpopular and ineffective, demonstrated the SSIC’s problematic
strategy of translating defense of economic arrangements into cultural
terms. The debate also revealed the SSIC’s deficiencies: the council offered
no program for recovery that any political leader could embrace, even as
concerns about future New Deal proposals mounted. As the NRA grew
more contested, the SSIC attempted to represent all sides of the debate –a
losing proposition.20
To show his spirit of support and cooperation with Roosevelt’s plan,
John Edgerton departed for Washington, DC, to confer with NRA offi-
cials about how the proposed reorganization would affect southern
industry. Edgerton’s testimony to Congress, and the responses of other
southern industrialists to his attempts to represent the region, epitomized
the difficulties still facing southern cooperation. In particular, southern
industrialists objected to stronger government “interference” with busi-
ness. Industrial self-regulation, Donald Comer argued, should take pre-
cedence over any government action. He explained, “Should a mill here
and there get its average wage rate out of line or out of step, I think that
we can depend upon the people who work in those particular mills to
look after that matter themselves.” Comer, along with other SSIC leaders,
Franklin Roosevelt, “On Moving Forward to Greater Freedom and Greater Security,”
20
Fireside Chat, 30 September 1934, in “Fireside Chats of Franklin D. Roosevelt,”

Transcribed by Franklin D. Roosevelt Presidential Library and Museum, hereaf-
ter referred to as FDR Library. John Edgerton, “Very Important,” Memo to SSIC
Constituency, 1 October 1934, SSIC Papers Box 3, Folder 2.
5 7
The NRA Revision Debate 75
rejected methods that restrained competition in wages. As the adminis-

tration pursued NRA revision, southern industrialists walked a fine line.
In their attempts to block robust economic intervention and to protect
associational approaches to recovery, SSIC leaders articulated stronger
antistatist rejections of the New Deal while attempting to preserve what
they liked of the NRA. Southern manufacturers focused on the practical
implications and arrangements of policy, rather than ideology, but the
NRA revision initiated a revision in this strategy.21
Some SSIC leaders recognized the need for a positive alternative to
the New Deal. Donald Comer suggested the SSIC recommend a plan for
regional recovery that would bolster Dixie’s advantages in labor costs
with locally based revitalization, absent any federal oversight that might
threaten the social status quo. Comer’s antistatism arose from fear that
southern workers would unionize under stronger federal support for col-
lective bargaining. He presented the case as a matter of worker choice
versus union and government compulsion. Instead of government over-
sight and planning, Comer praised the “natural process” whereby work-
ers “selected” their places of employment and thus competition between
firms would produce wage self-regulation. Such a system, he explained,
would keep labor cheaper in the South, thereby preserving the region’s
competitive advantage, while also maintaining workers’ right to “choose”
an employer. As he told his fellow SSIC vice president William Anderson,
workers would gravitate toward factories where their services were more
“appreciated” and conditions were more humane, eliminating the need
for costly regulation of industrial practices. Though Comer’s recommen-
dations looked to be laissez-faire with a southern accent, his approach
reflected both his economic preferences and his desire to protect paternal-
istic labor relations of southern mill villages against unionization, which
the SSIC saw as the greatest threat to Dixie’s separate labor market.22
Not all southern industrialists saw doom in NRA revision. The pres-
ident’s Fireside Chat heartened some, particularly manufacturers who
interpreted the president’s actions as supporting peace between manage-
ment and labor. Many assumed that Roosevelt planned to address prob-
lems of labor unrest plaguing southern mills, particularly textile mills,
throughout 1934. Strikes occurred in the South during the 1920s, often
Edgerton, “Very Important.”

21
22 This strategy also represented years of experience. Comer had accepted state-level child
labor laws in the 1920s as a way to “forestall more radical change.” Breedlove, “Donald
Comer,” 86. Comer to Anderson, Cannon, Marchant, Henry, Gossett, 4 October 1934,
67
resulting in violent clashes between management-hired thugs and striking

workers, and increased again after the NRA empowered workers and
organizers targeted ununionized southern textile mills. Characterizing
union unrest as primarily a northern phenomenon fomented by “for-
eign” labor was a popular weapon among southern employers to under-
mine strikes. B. B. Gossett, former president of the ACMA and of North
Carolina’s Gossett Mills, found encouragement in Roosevelt’s statements
about the need for fair profits for business and Roosevelt’s stated belief
that individual initiative would drive the nation toward recovery. Gossett
especially appreciated the president’s call for peace between workers and
capital.23
Indeed, days after the speech, the president and Secretary of Labor
Frances Perkins helped broker a truce between workers and management
in response to the walkout of more 376,000 textile workers in the North
and South. Even though the strikes strengthened congressional efforts for
stronger labor legislation, the president’s actions in response to the strikes
that autumn bolstered southern manufacturers’ hopes that the admin-
istration accepted arguments that the region’s industrial life and future
economic development required special protections. First, however, man-
ufacturers had to ensure that the reform measures they most feared were
not put into action, and they made a strident case that invoked specific
notions of southern civilization.24
During the NRA reorganization, SSIC leaders identified which ini-
tiatives threatened the South’s low wages while attempting to preserve
certain NRA benefits, such as promotion of price stability. SSIC leaders
sought to ensure that their favorite aspects of the NRA were not sub-
sumed in the reorganization. To this end, Edgerton declared the South
in total opposition to the direction in which the New Deal was moving.
He wrote that the South, without fearing loss of material advantage in
the face of defending principle, “is awakening rapidly now to the fact
that it must now both speak and act if our American democracy, the
constitutional rights of the States and their citizens, and our southern
Anglo-Saxon civilization and ideals are to be preserved.” Edgerton pro-
claimed that the South was emerging to a position of power and respon-
sibility. The South, he asserted, “naturally shrinks in its pride from the
strange substitutions offered by the Frankfurters, Cohens, Corcorans,
23 B. B. Gossett to Sloan, Gardner, Cannon, 1 October 1934, Josiah Bailey Papers, 344.
John Edgerton, “Very Important.”
“Both Industry and Labor Hail Roosevelt’s Truce: No Compulsion Implied” New York
24
Times, 2 October 1934.
7
and Tugwells,” referring to Roosevelt’s ally on the Supreme Court, Justice

Felix Frankfurter, advisors Thomas Corcoran and Benjamin Cohen, and
economist Rexford Tugwell. Such rhetoric, Edgerton hoped, would lead
policymakers to move cautiously in the reorganization, and he promoted
fears of what might replace the NRA if it disappeared.25
Allegations that the government would go into competition with private
industry, circulating among manufacturers, reflected their distrust of both
the administration and non-southern competitors. The SSIC’s Nashville
headquarters received numerous complaints from southern businesses
claiming that the federal government had opened plants in direct com-
petition with them –claiming TVA-run plants made furniture, jute ties
for the U.S. Postal Service mails, or mattresses for government facilities.
Such letters expressed concerns based in ideological opposition to federal
involvement. SSIC leaders echoed their sentiments. “From Jefferson to
[Theodore] Roosevelt and from Hamilton to Hoover,” Edgerton declared
to SSIC members, “no National Democratic or Republican platform has
ever been so contemptuous of American traditions and institutions,”
adding, “Only Socialists and the wilder elements have had such stupid
courage.” Edgerton could cite only a few instances of “government com-
petition,” but he warned that should the NRA be abolished and replaced
with a new program, unconstitutional legislation would emerge.26
Despite concerns that northern competitors had seized the NRA for
their own advantage, southern industrialists clung to it as the last embod-
iment of associative industrial practices. “There’s too much hysteria in
Washington,” William Anderson explained to his fellow SSIC vice pres-
ident Donald Comer, ignoring the strident warnings of revolution com-
ing from the SSIC’s president and founder. With his allies on the SSIC
Executive Board, Anderson wanted to quell NRA criticism so that it would
not be replaced with stronger legislation. Southern manufacturers sought
to preserve NRA- negotiated industry agreements that brought price
stabilization, while also allowing them to expand their ability to adjust
25 Edgerton to SSIC constituency, 18 December 1934, Donald Comer Papers 7.124.14.

Corcoran and Cohen, in particular, would come to represent to southern manufacturers
and the public the temporary resurgence of antimonopolists and a liberal network within
the administration after the recession of 1937. This early episode laid the ideological
groundwork among conservatives that would coalesce into the anti–New Deal coalition.
Brinkley, The End of Reform, 48–58.
John Edgerton, “What Price Recovery?” to constituency. August 17, 1934, SSIC Papers
26
Box 3, Folder 2. This article was also printed in the popular regional publication along-
side a letter from Harry Byrd criticizing the “autocratic” power of federal bureaus.
Manufacturers’ Record, Vol. 103, July 1934, 18–19.
87
machine hours in the face of temporary crises. Seasonal adjustments and

other fluctuations in the business cycle were natural, and he feared that
replacement legislation would interfere with ongoing workplace adapta-
tions to a changing regulatory environment. Industrialists’ entreaties such
as those by Anderson reflected a belief that the administration planned
to intervene more in the region. The reorganization increased fears that
the administration ignored southern manufacturers’ repeated warnings
about altering the NRA before it had a chance to work.27
Roosevelt’s Fireside Chat of September 30 targeted rising business crit-
icism of the NRA, a trend that the founding of the SSIC exemplified. One
reporter mused that business had been effectively on strike for months
and that employers were really asking for restraint in reforms and a more
conservative recovery plan. The reporter was correct. Anderson worried
that criticism of NRA overreach would lead to a broader NRA reor-
ganization along lines to which business would object even further. He
warned that to “pitch it out the front door” would mean the return of
the worst economic conditions just “as we made our way back to our
desks after doing the ‘kicking out job.’ ” The NRA codes, to Anderson,
held industry in an artificial condition of stability. Although not ideal,
he preferred the NRA to the unmitigated disaster that threatened if it
failed. For southern manufacturers, especially in textiles, economic stabil-
ity trumped all other concerns. Roosevelt’s address split business groups
into those who wished to preserve the NRA and those who sought its
demise, whatever replacement came. SSIC leaders attempted to straddle
these two camps.28
Vice presidents Comer and Anderson spilled a copious amount of ink
between them debating how to keep the NRA provisions they liked while
ditching the rest. Anderson proposed the elimination of service codes. He
and many others perceived little benefit in regulating barbershops, burger
joints, and drug stores. For what remained, Anderson favored NRA
extension in its present form only with intrastate business omitted from
oversight. Most southern manufacturers abhorred the NIRA’s Section 7a
that allowed for collective bargaining, but they admitted that keeping it
would be easier than trying to rewrite or clarify it. And because the NRA
had helped stabilize prices and addressed child labor –a practice that
Anderson to Comer, 18 March 1935, Donald Comer Papers 7.116.1. “End of Boycott
27
and Price Fixing Considered by NRA” New York Times, 5 October 1934. “Roosevelt
Drafts Speech to Nation to Answer Critics” New York Times, 20 September 1934.
“ ‘Dr.’ Roosevelt’s Replies Puzzle Some ‘Patients’ ” New York Times, 7 October 1934.
28
Anderson to Comer, 18 March 1935, Donald Comer Papers 7.116.1.

9 7
had been a major public relations problem for southern industry (if not a
grave concern for child welfare) –a good proportion of southern manu-
facturers supported extension in some form. Codes to regulate child labor,
a low minimum wage, and rules on maximum hours and machine hours
seemed acceptable to the majority of the SSIC’s membership. Without the
NRA, textile manufacturers feared the return of cutthroat competition,
noting increased cheap imports from Japan. Although the NRA had its
problems, more than half of the SSIC’s members conceded that the law
allowed for the “intelligent and orderly” conduct of business.29
Still, this majority was scant. When questioned by Senator William
King of Utah at a Senate hearing on the NRA’s continuation, John
Edgerton presented figures evincing southern industrialists’ divided opin-
ions about the NRA. Among the SSIC’s membership, 56 percent favored
modification or outright extension while 44 percent wanted to let the
NRA expire. This relatively even division of opinion meant Edgerton
had to split hairs to maintain his self-proclaimed position as representa-
tive of all southern industry. To this end, Edgerton recommended exten-
sion with modification in his congressional testimony. Senator Robert
M. LaFollette Jr. of Wisconsin queried what percentage of southern man-
ufacturers approved of wage and hour provisions. Edgerton reported
that among the roughly one-third favoring extension with modifications,
92.2 percent were in favor of maximum hours. A robust 93.7 percent
approved of some form of minimum wage provision to prevent cutthroat
competition, but 88 percent also agreed that regional wage differentials
should be included. In general, SSIC members disapproved of the more
government-centered control mechanisms of the NRA, such as price fix-
ing and distribution control, as long as the South, or at least small and
rural localities, received adequate exemptions from northern-set wages.
These demands produced a seemingly paradoxical combination of a pref-
erence for free markets and competition and government protection for
southern industry.30
The idea of southern discrimination served to enhance SSIC leaders’
criticisms of the fairness of the New Deal toward the South. Edgerton
Comer to Anderson, Cannon, Marchant, Henry, Gossett, 4 October 1934, Donald

29
Comer Papers 7.104.5. Edgerton to Comer, 22 November 1934, Donald Comer Papers
7.113.19. Anderson to Comer, 18 March 1935, Donald Comer Papers 7.116.1. Anderson
to Bailey, 4 April 1935, Josiah Bailey Papers, 182.
John Edgerton, Committee on Finance, Investigation of the National Recovery
30
Administration, Vol. 2, Hearings before the Committee on Finance, United States Senate,
5–16 April 1935, 74th Cong., 1st Session, S. Res. 79. (Washington: USGPO, 1935), 1617.
08
stated that cotton industrialists in the south raised wages by 70 percent

between July 1933 and August 1934, whereas other areas only increased
wages by 48.8 percent. Edgerton expressed resentment that the Federal
Emergency Relief Act (FERA) distributed relief funds to states based on
cost of living, but minimum wage decisions ignored the same standards.
FERA allocated to state relief projects an average of $12.05 per family in
the fourteen southern states, compared to $24.10 per family in the rest of
the country. If the federal government recognized the South’s agricultural
background, lower worker efficiency, higher unit cost, and lower costs
of living when allocating relief funds, Edgerton argued, why not ensure
fair and consistent wage differentials? As Edgerton saw it, if he could
preserve protections for southern manufacturers under the New Deal, he
could quell criticisms of the NRA without risking replacement with more
onerous legislation. He could also make the case that the South received
unfair treatment under federal programs, which served his larger ideo-
logical mission. Though his argument seemed to suggest that the South
demanded a greater share of federal aid, Edgerton’s true purpose was to
highlight the inherent unfairness of the federal dole.31
Testimony from other southern manufacturers demonstrated the tenu-
ous line that Edgerton had to walk to hold his intraregional organization
together, as well as the lack of consensus about the NRA among busi-
ness leaders in general. Northern interests seemed amenable to blanket
regulation of hours and wages. The National Association of Furniture
Manufacturers (NAFM), which represented the northern and midwest-
ern branches of the industry, called for the discontinuation of the NRA,
declaring that the codes were “futile” and required “omniscience to say
nothing of omnipotence on the part of any administration to have suffi-
cient knowledge” of various industries and their interrelationships. The
NAFM representative testified that “even a Philadelphia lawyer could
not have followed our code” and suggested that an outright minimum
wage law might prove a more straightforward and accessible alternative.
Though southern manufacturers did agree that a national minimum wage
was preferable, both national and southern furniture representatives
concurred that the NRA damaged their industry. The SFMA, the south-
ern voice of furniture manufacturers, suggested the NRA was respon-
sible for the closing of more than forty mills in North Carolina alone,
thus halving of the value of production in the state. A Bylo Furniture
31 Ibid. By 1935, the SSIC had already expanded its definition of the South from thirteen to
fourteen states, having included Missouri.
1 8
Manufacturing Company executive and SSIC member declared that his

experience under the NRA in Statesville, North Carolina, had been disas-
trous. Because large manufacturers could afford modern equipment, he
argued, the NRA skewed conditions in their favor. Increased employment
under the NRA increased output, he explained, so large businesses with
greater economies of scale could drive small competitors out of business.
Overall, manufacturers diverged by sector and region when it came to
how the NRA should be revised or replaced.32
Only southern fertilizer manufacturers overwhelmingly supported
the NRA’s continuation because they had few non-southern members on
their code board with whom to battle over regional wage differences.
The industry’s poor performance because of agricultural decline placed it
among the most desperate for federal intervention. A member of the fer-
tilizer board, representing its thirty-four members –fifteen small compa-
nies, eight medium, and eleven large –praised the code. He testified that
no price fixing had taken place in the industry. Fertilizer production had
decreased precipitously since 1929 among the 835 members of the code.
Fertilizer code members were overwhelmingly southern, including firms
such as Standard Fertilizer of North Carolina and Decatur Fertilizer of
Alabama. Appearing “strongly” in favor of the NRA, the fertilizer indus-
try representative declared that under the code the “little fellow is getting
a better break.” Among chemical producers, SSIC membership remained
relatively low until 1937, given the concentration of fertilizer manufac-
turing in the South; only twenty-seven firms in chemicals supported the
SSIC in 1934, and thirty-nine in 1935 –and even fewer from the fertil-
izer subcategory. Fewer than ten fertilizer-manufacturing firms lent their
support to the SSIC before 1938, though there were more than 400 such
firms in the South. With the Northeast and Middle States boasting only
127 and 52 fertilizer manufacturers, respectively, southern fertilizer com-
panies could control the code to meet their interests.33
Despite varying opinions on NRA revision, the controversies over how
to proceed revealed the emergence of a broader New Deal critique, espe-
cially concerning the president’s character and intentions. “Roosevelt’s
egotism is unbounded,” wrote Francis B. Gault, president of the North
32 SFMA to Bailey, 27 March 1935, Josiah Bailey Papers, 168. Bylo Furniture Manufacturing
Company to Bailey, 9 April 1935; F. B. Gault, North Carolina Lumber Company to
Bailey, 11 April 1935, Josiah Bailey Papers, 231.
C.G. Crockett, letter submitted to Committee on Finance, Investigation of the National
33
Recovery Administration, Vol. 2, Hearings before the Committee on Finance, United

States Senate, 1742; Odum, Southern Regions, 442.
28
Carolina Lumber Company, a longtime booster and progressive voice

in the state. Gault’s company shut down for two years in the midst of
the Depression and few programs out of Washington gave him hope.
“Our President is undoubtedly a man of very fine character and good
intentions, but with all seems to be an idealist and an arrogant politician,
obsessed with the one idea of gaining power at any cost –rule or ruin.”
Employers’ basic rights were under attack, critics declared, including the
right to individual contracts with employers, protection of employees
from outside agitation, and the rights of a minority against majority rule.
These concerns motivated SSIC leaders to consolidate support among
business and politicians by enhancing their ideological message, and they
began to envision a broader program for their organization, whatever the
fate of the NRA.34
This program relied on a network of national business associations.
The SSIC could better justify its existence by pursuing specific regional
protections that members demanded, leaving the national associations
to make the case for piecemeal reform. Henry Harriman, president of
the United States Chamber of Commerce, for example, testified that the
NIRA attempted too much and inspired unrealistic expectations. The
NRA should have developed gradually, he explained, allowing business
leaders to have a stronger voice. He explained, “The policy adopted in
the enthusiasm of the moment was one of codifying the entire Nation
and of bringing under the wings of the ‘blue eagle’ industries both large
and small; both intrastate and interstate.” The experiment, he concluded,
worked both good and evil. He affirmed the NRA’s ability to correct
bad business practices and suggested specific reforms, including applying
codes only to interstate commerce and limiting government involvement
in the modification of codes. SSIC leaders charged northern industry
with using the NRA to undermine southern competitiveness, but they
were happy to let the national organizations criticize the New Deal while
southern manufacturers pursued their own protections.35
Ibid. Charles B. Gault, “Gault, Francis Beers,” Dictionary of North Carolina Biography:
34
Vol. 2, D–G, Volume 2, William S. Powell, ed. (Chapel Hill: University of North Carolina
Press, 1986), 288. Gault may have been progressive in his political orientation, but the
southern lumber industry tended to be beset by low wages and poor benefits, and owners
“exploited racial divisions and vagrancy laws to ensure a cheap and quiescent work-
force.” Gordon, New Deals, 67.
Henry Harriman, Committee on Finance, Investigation of the National Recovery
35
Administration, Vol. 2, Hearings Before the Committee on Finance, United States Senate,
5–16 April 1935, 2038.
3 8
Pink Tea Lobbying 83
With the limitations of the NRA revision debate revealed, the SSIC
continued its mission to “protect and defend” the South, leaving national
organizations to address constitutional concerns. While southern manu-
facturers fought to preserve their firms’ survival by protecting predictable
business conditions through price controls and price-fixing agreements,
they also realized that they themselves lacked sufficient clout within
the system to control regulations in their favor. Although SSIC leaders
acknowledged and agreed with the constitutional questions about the
New Deal posed by business conservatives, they chose to act along more
practical lines. SSIC leaders’ ideological rhetoric against the New Deal
grew more heated as 1935 neared, but regional concerns and the rheto-
ric of southern civilization still dominated the SSIC’s attempts to court
political allies.36
Pink Tea Lobbying

In the spring of 1935, the SSIC appeared coherent and well-funded, and
it garnered the attention of many southern members of Congress. SSIC
leaders had become masters at playing defense, but they lacked any posi-
tive alternative to the New Deal. Preservation of low wages remained the
SSIC’s primary purpose, but this goal was gilded within the desire to pre-
serve a separate, special southern economy and culture. While the NRA
debate revealed that SSIC leaders espoused antistatist critiques of the
New Deal, their organization struggled to move its criticisms from out of
the conference rooms to sway the public and policymakers. By focusing
on a defensive strategy, the SSIC began to subtly reorganize allies and
opponents according to their New Deal positions. Several key relation-
ships and a public fight with Texas representative Maury Maverick illus-
trated the SSIC’s political network as it emerged in early 1935.37
Southern industrialists, particularly cotton textile manufacturers,
had celebrated having a Democrat in the White House after years of
Republican rule. Tyre Taylor, general counsel for both the SSIC and the
ACMA, lauded the president’s recovery program and visionary rhetoric.
Taylor had told the Virginia Young Democratic Club in August 1933 that
the Democratic Party and Roosevelt charted a course for American civi-
lization. Industry, in his opinion, offered the best remedy for the South’s
deficiencies in education, public health, and prosperity. Only industry
Shaffer, In Restraint of Trade, 16.

36
Wiebe, Businessmen and Reform, 82–84.

37
48
could restore employment, purchasing power, and faith in progress, as

he saw it. Taylor cast his lot with Roosevelt and the Democrats, telling
the assembled group, “We are no longer a party of protest, but a party
charged with one of the most poignant responsibilities in human history.
If Franklin D. Roosevelt fails, the America that most of us know and
believe in fails.”38
Taylor embodied the shift taking place among southern manufac-
turers. Only a few years after praising Roosevelt, Taylor protested that
through the New Deal a “demagogue named Roosevelt was enabled to
smear business as a whole.” In the first days of the New Deal, Taylor saw
no conflict between the national party and southern values. Prominent
southern industrialists had helped put the Democratic Party in power
and were key members of the New Deal coalition; they felt that the pres-
ident owed the South favors for its solidarity. Given the concessions the
administration made to the South throughout the New Deal, they were
correct in assuming powerful conservative southerners held the power to
influence reform –even if manufacturers did not achieve the extensive
wage differentials they desired. Southern Democrats’ personal prestige
remained tied to the success of the Roosevelt administration. Until 1935,
many manufacturers found it easier to work for beneficial programs and
legislation from within the system than from without. Though southern
leaders such as Taylor grew incensed at the president and his administra-
tion, these regional powerbrokers hoped that they could hold southern
congressional leaders close and continue to influence legislation.39
Many southern senators and congressmen were among Roosevelt’s
strongest supporters. Even Senators Carter Glass of Virginia and
Josiah Bailey of North Carolina, two of the Senate’s most conservative
Tyre Taylor, the General Counsel for the ACMA and later for the SSIC, acted as an orga-
38
nizational link between business leaders and political backrooms in the 1930s through
the 1950s. He helped found the Young Democratic Clubs, and served as its president.
He coordinated his Democratic Party activism with Senator Harry F. Byrd in Virginia
and the Shelby Dynasty in North Carolina. In 1932, he told Byrd that he and the Young
Democratic Clubs saw the senator as the best candidate for president, and lamented the
chaos of Democrats in Congress, citing business concerns about Congress and Hoover’s
failure to balance the budget. Tyre Taylor to Harry Byrd, 9 May 1932, Byrd Papers,
Box 151. Tyre Taylor, “Address of Tyre Taylor, President, Young Democratic Clubs of
America, to the State Convention,” Richmond, Virginia, 16 August 1933, unpublished
speech, Tyre C. Taylor Papers, Collection No. 131, East Carolina Manuscript Collection,
J.Y. Joyner Library, East Carolina University, Greenville, NC (hereafter referred to as
Tyre Taylor Papers).
Tyre Taylor, “[SSIC General Counsel] Report from Washington,” undated, Tyre C. Taylor
39
Papers.
5 8
southern members, voiced their early support of the president, though

not without reservations. As the economic emergency entered its fourth
year, conservative convictions were not always indicative of an indi-
vidual’s general hostility toward the New Deal. Senator Bailey exhib-
ited optimism for the Democratic administration, although he reserved
the right to review and question each measure. “In due season,” Bailey
wrote in May 1933, “I will be found amongst the foremost defenders
of the President, and by reason of having shown a reasonable amount
of intelligence, will be in position to do him much better service than
those who blindly accept whatever he set down.” Although he criti-
cized certain New Deal programs, and by April 1934 was charging the
New Deal with giving in to “radicalism” and advancing “Communistic”
plans, Bailey supported key components and welcomed federal funds
for his home state.40
Senator Glass appealed to industrialists’ progressive mindset while
also promising a conservative approach to reform. He offered tepid sup-
port for Roosevelt’s election but turned down the position of Secretary
of the Treasury under FDR, a post he had held under Woodrow Wilson.
Glass’s political philosophy resembled that of other southern progres-
sives. As Wilson did, he favored the expansion of regulatory powers to
ensure public health and safety. Glass also defended Jeffersonian princi-
ples and individual rights. Glass advocated “Fair play, equal opportunity,
the elimination of privilege and corruption” along with freedom from
coercion. Reform should secure “safe and impartial conditions” without
compromising liberty, in Glass’s view. To preserve liberty, the state should
refrain from interfering with the day-to-day operations of industry and
commerce. In Glass’s assessment, the NRA violated these principles. He
criticized the administration’s early record, perhaps inspired by personal
indignation when the administration failed to consult him on matters of
banking and currency. Yet southern politicians, even Glass, were beholden
to Democratic power brokers to preserve their positions within the party.
Most importantly, they wanted federal relief for the needy in their states
and districts.41
Bailey to Governor Doughton, 10 May 1933, Josiah Bailey Papers, 106. Josiah Bailey,
40
“Liberty vs. Communism,” Manufacturers’ Record, Vol. 103, April 1934, 16.

A. Cash Koeniger, “Carter Glass and the National Recovery Administration,” South
41
Atlantic Quarterly 74, 3 (1975): 351. See correspondence from businesses in Virginia to

Glass, Carter Glass Papers, Box 315, University of Virginia. Glass, quoted in Rixey Smith
and Norman Beasley, Carter Glass: A Biography (New York: Longmans Green and Co.,
1939), 357.
68
By 1935, after the 1934 midterm election gave the administration a

strong endorsement, conservative criticism grew. Senators Glass, Bailey,
and Harry F. Byrd of Virginia suspected the Roosevelt administration of
attempting unconstitutional grabs at political power, a position voiced by
the SSIC’s leadership as well. Even before the NRA’s reorganization, Glass
characterized the program as collectivist, reflecting radical, not progres-
sive, influences. The Virginia senator disparaged the NRA codes govern-
ing his publishing business, and he told Gen. Hugh Johnson, “Your blue
buzzard will not fly from the mastheads of my two newspapers.” As the
NRA’s measures began to affect Virginia businesses, Senator Glass’s view
of the NRA Blue Eagle grew more sinister and he warned Hugh Johnson
that the blue buzzard was “fast becoming a bird of prey.” As criticism
of the codes grew, and court challenges proceeded to the NIRA’s consti-
tutionality, southern conservatives felt more emboldened to criticize the
NRA’s efficacy. Stronger opposition, however, threatened to eradicate the
protections that industrialists sought to preserve, which meant extending,
at least in some form, the NRA. The NRA was doomed, clearly, so south-
ern manufacturers approached directly in order to shape, or limit, future
reforms that would affect the South. In so doing, they would complicate
their insistence that the South acted as a solid unit. Instead, they would
highlight the political divisions among the South’s political class.42
John Edgerton’s brief but public fight with freshman Texas congressman
Maury Maverick in the spring of 1935 revealed SSIC lobbying activities.
Maverick, described as a “rebel against southern and national traditions and
policies he deemed archaic and reactionary,” rose quickly to prominence in
the House’s “liberal bloc.” He became one of the strongest populist voices in
Congress and gained a reputation as an iconoclast. He detested bureaucratic
excess and has been credited with coining the term “gobbledygook” to describe
the impenetrable language of laws and regulations. His name, following the
family’s reputation in Texas for individualism, became synonymous with polit-
ical outsiders who do not conform to Washington’s insider culture. He wanted
the government to work for the people, and, in his opinion, manufacturers and
business interests represented the worst kind of influence on politics.43
Koeniger, “Carter Glass and the National Recovery Administration,” 351. Glass in
42
Heinemann, Depression and New Deal in Virginia, 55–56. For more on the role that
southern conservatives played in limiting reform during the New Deal, see Ira Katznelson,
Fear Itself: The New Deal and the Origins of Our Time (New York: Liveright Publishing
Corporation, 2013), especially Parts I and II.
“Original ‘Maverick’ Was Unconventional Texan,” 5 September 2008, National Public
43
Radio, www.npr.org/templates/story/story.php?storyId=94312345.
7 8
The SSIC epitomized precisely the southerners to whom Maverick

objected the most: wealthy, established, and aristocratic-minded elites
who touted southern exceptionalism. He placed the blame for the South’s
problems on “homegrown reactionaries who scapegoated, preaching a
martyred South persecuted by northern capitalists, to divert attention
from their own entrenched interests.” To the SSIC, and especially to John
Edgerton, Maverick was the voice of the upstart, uncouth politics of the
backcountry. His communication style offended industrialists’ sensibil-
ities. The clash with the Texan illustrated the SSIC’s attempts to pro-
pagandize broadly to southern representatives using wealth and social
status –and the degree to which critics such as Maverick saw through
the orchestrations.44
The SSIC’s Washington dinner in April 1935 was an attempt to rally
southern representatives against reforms that would affect southern
industry and result in what white southern elites perceived as violations
of sacred political principles. Council leaders had discussed entertaining
southern congressmen before but had decided their organization and its
program was not ready for such public display. By March 1935, council
leaders felt secure enough to present southern representatives with their
arguments. Edgerton invited all southern representatives to dine with
council leaders, including House Speaker Joseph W. Byrns of Tennessee,
Senators Kenneth D. McKellar and Nathan L. Bachman of Tennessee,
Richard Russell and Walter George of Georgia, and Alben Barkley of
Kentucky. Representatives from southern states included Tennessee’s
B. Carroll Reece and Samuel McReynolds and Georgia’s Robert
Ramspeck. With the SSIC’s growing reputation in Washington as a rep-
resentative for southern industrial opinion, Edgerton and council leaders
aimed to sit southern congressmen down and explain industry’s position.
Not content with preaching to the choir, the SSIC did not limit the guest
list to like-minded politicians and extended invitations to antagonists as
well. The SSIC hoped to appeal to southern solidarity to influence policy
and the extension of the New Deal.
When the SSIC invited all southern representatives in Congress to a
dinner, Maverick’s temper flared. The invitation offered him an opportu-
nity to criticize the SSIC and lobbyists. The liberal House member told
the press that he was “sick and tired of all this pink tea lobbying around
Congress.” Referring generally to the increase in lobbying with its lure of
44 Stuart Weiss, “Maury Maverick and the Liberal Bloc,” Journal of American History 57,
4 (1971): 880, 888.
8
fine dining and good drink, Maverick used the SSIC invitation to condemn
the practice. “We are called together and given a free meal,” he declared,
“and thereafter a nice talk and told we are fine boys and, of course, will
vote right and in a patriotic manner –that is, according to the special
interest that invites us out.” Maverick reported being treated as if he were
in need of a free meal. He refused the invitation, using the press, declar-
ing, “I shall decline your invitation to accept dinner at one of the local
hotels, unless I can be permitted to pay for my own food. I earn $10,000
a year as a Congressman –enough to buy food.”45
Maverick’s protest offended Edgerton, and the SSIC president
responded publicly. He chastised Maverick as an inexperienced outsider,
unfamiliar with the workings of Washington. Representing the SSIC, he
wrote, “in this newspaper ‘blast’ … [t]‌he reporter was kind enough to
explain that you are a freshman congressman … presumably so the public
would understand why you sicken and tire so quickly of public service.”
Edgerton put himself forward as an old hand in Washington, offering
advice to a new member who did not understand social graces. “We do
not question your right to exhibit publicly your contempt for ordinary
social amenities,” he wrote. “We even concede that it is not an altogether
unworthy ambition to be a precedent-smasher, tradition inverter, and the
founder of new social customs for the guidance of future statesmen.”
Rebuffing Maverick’s aspersions on SSIC intentions, Edgerton continued,
“we do deplore the implication that it is an unsafe thing for a member of
Congress to expose himself to the influence of a good steak and the infor-
mation which he often gets in connection therewith.” Edgerton wrote,
“we also question both the propriety and your right to impute sinister
designs to this or any other group’s courteous invitation to public ser-
vants to dine with them. The only ‘special interest’ we have is that of the
welfare of Southern industry.” Maverick’s reply: “Phooey.”46
Maverick recognized that the dinner was political lobbying guised in
social niceties and southern hospitality. One newspaper editor noted the
SSIC’s not-so-stealthy purpose, writing, “Propaganda sifted through soft
lights, laughter, and music is ever so much more convincing.” He con-
tinued, “Many a man who could not be bought for millions has been
tempted by a good steak.” The dinner went forward without the blustery
Texan.47
“Tea Totaler,” Philadelphia Record, 30 March 1935.

45
46 Ibid.
“A Good Steak,” Pittsburgh Post-Gazette, 10 May 1935.
47
9 8
While purportedly meeting to secure the South’s economic future,

Edgerton and SSIC leaders began the dinner with another message. The
purpose they proclaimed –one to which Maverick would have objected
vehemently –was to build common cause and identify threats posed to
their common heritage. Edgerton addressed the gathered with rever-
ence, expressed his gratitude, and called the meeting a “coming together
of Jeffersonian equals.” The problems facing the nation, he explained,
pertained uniquely to the South, and southerners bore a “peculiar posi-
tion of responsibility.” Not only were southern industrialists responsible
for the economic welfare of the South, both past and present, Edgerton
explained, but they also guarded the region’s most sacred traditions and
principles –the principles of Jefferson, Madison, and Washington, as he
named them. Edgerton’s address to southern congressmen revealed the
antistatist political majority he and his allies sought to build, even as he
disavowed manufacturers’ profit motive.48
Edgerton insisted that economic interest alone did not motivate his
organization, but it was committed to preserving the South’s social status
quo. “We are not willing to trade moral and spiritual values for mere eco-
nomics,” he declared, as he stood in the banquet hall of Washington, DC’s
New Willard Hotel, site of the dinner. The woolen manufacturer insisted
that he and other Dixie industrialists would sacrifice profit for the sake
of defending the region’s cultural integrity. His statements revealed the
lengths to which southern manufacturers would go to protect their inter-
ests, even proclaiming that their profits came second to the lofty goals
of preserving culture and tradition. Certainly, Edgerton kept the SSIC’s
policy goals in mind, the goals that he had pursued on behalf of southern
industries in code hearings. To appeal to the gathered crowd, Edgerton
avowed that he was no carpetbagger or scalawag industrialist who
wanted to remake Dixie in the North’s image. He calculated that promot-
ing himself as a southern patrician was the best strategy to prevent fed-
eral intervention in the southern economy. If the assembled politicians,
who were enjoying a delicious steak courtesy of southern manufacturers,
trusted industrialists to care for the South’s workers, all would be well.49
Observers in both Washington, DC and in southern states understood
the political nature of the SSIC’s Washington dinner and manufacturers’
increasingly anti–New Deal stance. Grove Patterson, editor of the Toledo
John Edgerton, “Address to Southern Representatives,” 25 April 1935, SSIC Papers Box
48
2, Folder 2.
Ibid.
49
09
Blade, concluded in his syndicated column that the dinner signified a

larger political development. “Originally the Southern States were pretty
strongly with the Democratic administration,” he wrote. “Now they are
turning away from it, and with good reason.” Some, such as Ralph Smith
of the Atlanta Journal, expressed disbelief that business leaders had the
gall to recommend an alternative path to recovery. “Really it is almost
funny to see and hear votaries of practices that led the country to the
brink of ruin strutting and declaiming, now that they feel secure,” he
wrote, describing Edgerton and his allies as parading “like lords of cre-
ation and declaiming as if they had the recipe for recovery and everlasting
prosperity.” Edgerton realized that he and the SSIC had a selling job to do
if they were to maintain the South’s separate labor market, which meant
distancing themselves from national business and appealing to solidarity
as southerners.50
Still, this approach reversed the organization’s professed spirit of
cooperation of just a year prior. Edgerton used racial, religious, and cul-
tural arguments within his appeals to regional solidarity in order to pre-
serve southern economic arrangements and the social system that helped
manufacturers control labor. Edgerton linked the defense of economic
principles with constitutional principles, and these would win out over
economic expediency and even recovery. “We of the rank and file of the
South,” he explained, attempting to indicate the SSIC’s wide support
among southerners, “do not believe that there is anything of such unusual
character in this latest emergency as to justify or call for deliberate con-
traventions or circumventions of the American Constitution or other
radical departures from established customs in treating extraordinary
conditions.” He mocked the idea of planned economies, declaring that
it had no place in the American system and an idea with such “foreign
suggestion … does not appeal naturally to most Anglo-Saxon minds.”
In 1935, the SSIC’s focus remained on “saving” the South from well-
meaning but misguided New Dealers.51
Edgerton and his SSIC allies cast politics as a matter of sectional com-
petition. Northern do-gooders swarmed to the South, he asserted, “to
tell us how backward we are and how old-fashioned and out-of-date it
is to be drinking water, going to church, working, praying, and actually
liking anybody who has more than we have.” While Edgerton protested
Grove Patterson, “A Study of the New Deal” in Newark Star-Eagle, 29 April 1935. Ralph
50
Smith, “Crackerland in Washington,” Atlanta Journal, 1 May 1935.

Edgerton, “Address to Southern Representatives.”
51
1 9
Conclusion 91
against meddlers who brought the wrong kind of “uplift,” he also rejected
economic populism. Private capital offered better, more rational solutions
than “political profiteers in social discontent.” Claiming to speak for all
American industry, Edgerton invoked their fear of the “hostile attitude of
Government itself” toward business. “Drastic” and “crippling” measures
were preventing the return of business confidence and therefore slowing
recovery.52
To SSIC leaders’ frustration, a strong majority of southerners remained
overwhelmingly supportive of the president and the New Deal, a fact that
did not escape the council’s critics. A Spartanburg, South Carolina res-
ident wrote that at the Washington dinner “not only did Mr. Edgerton
and [railroad executive and SSIC vice president] Mr. [Fitzgerald] Hall not
represent the South; they misrepresented it.” Rather, the writer explained,
the majority of South Carolinians were in support of the New Deal.
Furthermore, in North Carolina, an editor at the Fayetteville Observer
rejected Edgerton’s assessment of moral and spiritual values. “Moral val-
ues, spiritual values and mere economics are not such aspects of human
life that can be neatly kept in entirely separate boxes,” he wrote. “No
nation or section can claim high moral and spiritual values if its leaders
are careless or complacent about ‘mere economics’ in an economic order
which dooms a great part of the people to living levels below those of
health and decency.” The midterm elections in 1934 had confirmed this
level of support in the South, with Dixie’s residents turning out to sup-
port the New Deal at the polls, overwhelmingly.53
Conclusion
It was becoming clear by mid-1935 that southern solidarity was not
sufficient to hold together a political coalition. Not only were southern
liberals rebuffed by the SSIC’s ministering, but the organization’s rising
antistatist rhetoric alienated allies interested in using the federal govern-
ment to address the South’s agricultural poverty. Criticism of the SSIC’s
emerging anti–New Deal politics also appeared from within the ranks of
the SSIC. Prominent supporter David Coker distanced himself from the
organization. The South Carolina seed manufacturer maintained a suspi-
cious attitude toward labor unions, surmising, one historian explained,
Ibid.
52
53 A Spartan, “Not the Voice of the South??” Spartanburg Journal, 2 May 1935; “Mere
Economics” Fayetteville Observer, 3 May 1935.
29
that unions took away wages and wealth from agricultural workers. He
also opposed greater government relief spending and consented to serve
as an agricultural consultant to the SSIC as well as a regional vice presi-
dent for South Carolina. Coker appeared before the gathering of south-
ern representatives in April 1935, but he wearied of Edgerton’s strident
rhetoric.54
Coker disagreed with the SSIC regarding the AAA’s processing tax,
which he saw as a necessary evil to help farmers who lacked purchas-
ing power or reasonable prices for their commodities. Coker also took
issue with Edgerton’s insistence that the South had a homogeneous pop-
ulation and warned him that this notion supported dangerous assump-
tions that “we have no negroes or negro problem.” For Coker, industry
ignored the issue of race to its detriment. Above all, he criticized the “con-
frontational” tone SSIC leaders took in speeches. He advised Edgerton,
“Broadcast denunciations by special interests will not serve a good
purpose.” Although Coker was no ally of Maverick, his estrangement
from the council demonstrated the cautious approach Edgerton and his
supporters had to take so as not to alienate loyal Democrats with their
criticism of their party’s first president since Woodrow Wilson. Coker’s
defection also revealed the difficulty of maintaining a coalition across
southern industry. Allies among agricultural interests, in particular,
proved the most difficult to win and retain, mostly because of the sector’s
destitution and willingness to accept federal intervention.55
Outside the South, observers saw southern industrialists as touting
cultural traditionalism and continuity with the Old South. One news-
paper editor in Minnesota characterized the council as “comprising the
traditional old southern Democratic aristocracy.” The SSIC aroused fur-
ther protest when Representative Andrew J. May of Kentucky placed
Edgerton’s comments in the congressional record. The Gazette of
Hastings, Minnesota, reported that Edgerton’s remarks revealed “that
the southern industrial reactionaries are in complete and open revolt
against everything in the New Deal that is progressive, even though they
have been strong party Democrats from time immemorial.” Yet the SSIC
still offered few alternatives other than to criticize existing policies; the
David L. Carlton, 1935 narrative accompanying the David Coker Papers.

54
In analyzing Edgerton’s strategy, Coker asserted, “As a great many of our social and eco-
55
nomic troubles are due to the negro and as the genesis of the cotton industry itself is due
largely to his presence, I hardly think he can be completely overlooked.” David Coker
to C. C. Gilbert, 22 April 1935, item 52; David Coker to John Edgerton, 4 May 1935,
Nashville, TN, item 70 (1935–outgoing), David Coker Papers.
3 9
Conclusion 93
organization’s activism was negative, emerging in response to, rather

than on behalf of, policy.56
Although SSIC leaders received hearings from many southern represen-
tatives, the organization lacked enough political support in Washington
to sway policy. During the 1930s, too many voices were trying to speak
for the South –either to address internal problems by cooperative means
or to defend the region despite its economic underdevelopment and pov-
erty. SSIC leaders’ assertions appeared cynical and inadequate to meet
southern deficiencies in infrastructure, human capital, agricultural wage
parity, and economic development. Moreover, the SSIC failed to prevent
the passage of the reforms they feared would replace the doomed NRA.
Despite these failures, SSIC leaders continued to tout southern solidarity
and exceptionalism, turning away from potential allies in national busi-
ness circles in response to the Wagner Act in 1935. Nevertheless, southern
manufacturers identified an increasingly ideologically oriented rhetoric
for their organization, which would continue to grow as they confronted
federal labor legislation.
“Weekly Resume,” Hastings Gazette (Hastings, MN), 10 May 1935.

56
49
Confronting the “Wagner Monstrosity”
In January 1937, Thurmond Chatham, a North Carolina blanket

manufacturer, expressed his sympathy for General Motors’ chief Alfred
Sloan. Workers at the Flint, Michigan, facilities were in the midst of
a forty-four-day sit-down strike. In the days following a violent clash
between workers occupying a plant and police who tried to storm the
building, Chatham wrote, “The GM strike has a great more to it than
the average person realizes.” He judged, “if the government is going to
become by law empowered to immediately enforce settlements of labor
disputes, I think we will see such a wave of strikes as possibly never seen
before, and the result could be far reaching and terrible to our recovery.”
He denounced workers’ occupation of plants, declaring that such tactics
were justification for auto manufacturers’ withdrawal from union nego-
tiations. Other southern manufacturers used the incident to further their
case against what they felt had been the “rushing through” of Frances
Perkins’s favored legislation “seemingly on the spur of the moment.”
Southern industrialists loathed the National Labor Relations Act of 1935
(NLRA, also known as the Wagner Act), which strengthened the NIRA’s
failed efforts to federally sanction collective bargaining and inserted fed-
eral power into what mill owners considered local and voluntary negoti-
ations between employer and employee.1
Although labor organizers made few inroads in the South, and were
unsuccessful in mobilizing effectively at the national level in the 1930s,
1 Thurmond Chatham to Bailey, 27 January 1937, Josiah Bailey Papers, 347. Chatham’s
company employed nearly 2,000 workers in 1938, meaning that his company would have
been a ripe place to increase union membership for the textile union. North Carolina
Industrial Directory and Reference Book, 215.
94
5 9
Confronting the “Wagner Monstrosity” 95
southern manufacturers feared such an outcome that would enhance

worker militancy. Southern manufacturers appealed to state and local
authorities to help them put down strikes in their plants both before and
after the Wagner Act, with greater success than their northern compa-
triots. In 1936 the CIO turned its attentions toward southern mills. The
passage of the NLRA swelled the ranks of the SSIC, the South’s most
vocal antiunion lobby. Membership in the SSIC soared in 1936, with
donations drawn in by Edgerton’s practiced antilabor rhetoric, messages
that he had honed during his days as the head of the NAM in the 1920s.
By November 1942, the United Textile Workers organized nine southern
mills and represented 6,000 workers –a small percentage of an indus-
try that employed more than 300,000 workers at the end of the 1930s.
Southern manufacturers, although they sought stability and to rein in
competition, were reluctant to hand off the power to control labor and to
maintain social stability to institutions outside of the South.2
After the Wagner Act’s passage and before the sit-down strikes, SSIC
pamphlets decried the influence of labor in the Roosevelt administra-
tion, reflecting southern manufacturers’ ongoing concern about the pos-
sible growth of nationally influential labor organizations. Such concerns
also reflected the lack of agreement in the business community regard-
ing the benefits of unionization, a development that tended to indict the
entire New Deal project. The SSIC’s Nashville headquarters distributed
these publications widely, to members and potential members and to all
southern representatives in Congress. One SSIC missive declared that the
organization would “oppos[e]‌with all our strength those legislative and
administrative parts of the New Deal program.” Ratcheting up the SSIC’s
previous rhetoric regarding the NRA, the letter warned that the admin-
istration’s programs to aid economic recovery, albeit misguided and
not malicious, were dangerous and anti-American. New Deal reforms,
crafted by “alien hands in the workshop of an irresponsible Brain
Trust,” would not only socialize private industry but also undermine the
Constitution itself. Gone were the SSIC leaders’ condescending exten-
sions of “education” to “ignorant” but well-meaning administrators. The
2 Nelson Lichtenstein, Labor’s War at Home: The CIO in World War II (New York:
Cambridge University Press, 1982), 10–11; Henry Harriman, Committee on Finance,
Investigation of the National Recovery Administration, Vol. 2, Hearings Before the
Committee on Finance, United States Senate, 5–16 April 1935. For the problems the
AFL and, notably, the CIO faced in organizing the South’s textile workers in the 1930s,
see Robert H. Zieger, The CIO, 1935–1955 (Chapel Hill: University of North Carolina
Press, 1997), 74–78. NAM continued to be an “antilabor stalwart.” Gordon, New Deals,
205, 206.
69
96 Confronting the “Wagner Monstrosity”
SSIC’s anti–New Deal position after the demise of the NIRA seemed to
offer a possible alliance with non-southern conservatives. SSIC leaders
looked at the 1936 General Motors strike with horror, as the natural
outcome of socialistic policies such as the Wagner Act, and they declared
that they stood in solidarity with management and employers across the
country. But this appearance of unity proved only superficial and lacked
organization.3
Labor organizers’ failure to recruit southern workers highlighted
southern representatives’ antiunion sentiments. Labor’s failures, however,
obscure the divisions among business interests, and more importantly
the way that southern manufacturers’ responses to the Wagner Act grew
from their search for “fair” treatment in programs to confront hypercom-
petition. Business leaders were varied in their responses to the Wagner
Act, a divergence that is partly explained by the strategies employed by
specific regions’ industrial sectors and their representatives.4
Southern manufacturers argued that Dixie’s manufacturing sector was
too different from northern models to create common cause. J. Spencer
Love of North Carolina’s Burlington Mills expressed his outrage at the
GM strike, but observed differences between the “average” organization,
typified by northern corporations, and southern textile mills such as his
own. He wrote,
There is little or no parallel between our organization and General Motors
from the standpoint of capitalization, set-up, or anything else. Our organization
has depended a great deal more on personnel than in the average organization
because we have had no financial background or anything else and everything
has been built by personal effort, whether it was financing, personnel, or brick
and mortar.5
Northern industries, with vast sources of capital and technology, in

Love’s view, could not appreciate the “personal” relationship between
southern manufacturers and their labor, their community, and their
investors. SSIC leaders tactically differentiated their own interests from
3 It is rare to visit an archive of southern congressional leaders from the 1930s through
the 1960s and not encounter SSIC publications and pamphlets in the papers, whether the
leader was conservative or liberal. “What Is the SSIC? Its History in Brief,” September
4 Southern business, like national business interests, had a similar nonideological response
to the Wagner Act because they remained focused on securing anticompetitive mecha-
nisms. Gordon, New Deals, 3.
5 J. Spencer Love to James Lee Love, 21 December, 1936, James Spencer Love Papers,
1851–1980, The Southern Historical Collection, University of North Carolina–Chapel
Hill, 1–114.
7 9
Confronting the “Wagner Monstrosity” 97
those of northern industries and rarely referred to the national business

associations in 1936, the Chamber or the NAM, as they had in 1934.
Such efforts added to the instability and of the business response to the
New Deal. Although SSIC leaders remained in state-level positions with
these organizations, they felt that southern experiences with labor orga-
nizers required explicitly regional representation, from leaders who could
articulate arguments specific to the South.6
SSIC leaders interpreted the NLRA as another tool for northern com-
petitors to stymie the growth of southern industry. Again, SSIC leaders
turned to southern exceptionalism to make their case against the mecha-
nisms of reform. SSIC adviser and spokesman, Gustavus Dyer, a profes-
sor of political science and economics at Vanderbilt University, argued
that the social homogeneity of southern industrial workers would block
unionization, though he never acknowledged the deficiencies of Dixie’s
industrial life. Moreover, southern manufacturers attempted to balance
their traditionalist and modernizing impulses, a sometimes Herculean
task. Such balancing also proved politically unproductive, particularly as
their criticisms of federal sanctioning of collective bargaining grew more
heated.
Indeed, southern manufacturers’ experiences with the NRA shaped
the SSIC’s response to the Wagner Act. The Wagner Act further convinced
SSIC leaders that the South would never receive fair treatment in a recov-
ery program designed to promote the interests of New York City rather
than those of Nashville, Norfolk, or Natchitoches. Southern manufactur-
ers saw the law as another weight around the neck of Dixie’s industry,
orchestrated by politically connected northern competitors. SSIC leaders
spewed harsh rhetoric against proposals they argued were incompatible
with American democratic principles –ideologically oriented arguments –
yet they continued to rally support by appealing to regional solidarity.
The more they invoked the supposed threat posed by cultures outside
their narrow definition of “southern civilization,” the more they hoped
to divide and conquer workers, keeping them loyal through paternalistic
overtures and promises of a cultural status quo. Manufacturers’ efforts,
in the end, were less ideological than they were politically practical in an
atmosphere that seemed to call for regional solidarity.7
6 Marshall, Labor in the South, 173–174; William J. Cooper and Thomas E. Terrill, The
American South: A History, Volume 2, 4th ed. (Lanham, MD: Rowman & Littlefield,
2009), 712; Love to James Lee Love, 21 December 1936. Gordon, New Deals, 1.
7 Michael Honey, Southern Labor and Black Civil Rights: Organizing Memphis Workers
(Urbana: University of Illinois Press, 1993); Brattain, The Politics of Whiteness; Daniel
89
Yet the failures of 1935, which yielded a stronger replacement of the

NRA’s Section 7a in the form of the Wagner Act, precipitated organiza-
tional and strategic changes in the South’s self-appointed industrial rep-
resentative. SSIC leaders realized that they required a different strategy if
they were to influence policy. Basing policy recommendations on social
and cultural arguments proved ineffective. SSIC leaders’ appeals to south-
ern solidarity to achieve a preferred political economy began to weaken
with their reaction to the Wagner Act. As the NRA faded into the back-
ground, southern manufacturers’ rhetoric would grow more ideological
and political than cultural, reactionary, and sectionalist, and they devel-
oped a stronger critique of the Democratic Party’s direction. Still, the SSIC
would face limitations in building a conservative countermovement.8
Southern Labor under the NRA

The spirit of “cooperation” that SSIC leaders claimed to possess toward
associative measures under the NRA did not extend to the NIRA’s Section
7a that allowed workers to form unions and required employers to rec-
ognize their choice and engage in negotiation. In particular, southern
manufacturers tried to undermine and ignore the rulings of the NRA’s
appointed labor disputes body, the National Labor Board (NLB). Though
SSIC leaders proclaimed their desire to support the administration, the
NRA and the NLB revealed these manufacturers’ insistence on maintain-
ing employer control of labor, to the detriment of curbing competition.
Manufacturers tried to leverage the law to maintain control of the
shop room floor as, in 1934, workers invoked their newly sanctioned
right to organize. Union organizers targeted the relatively nonunionized
South, where employers used an array of tactics to undermine NRA
wage increases and other regulations. In addition to reclassifying work-
ers as “learners,” who were thus excluded from the NRA wage mini-
mums, textile manufacturers cut hours, thereby maintaining low wages
or reducing them even further. Frustrated workers welcomed the United
Textile Workers of America (UTW), which sent organizers to the region’s
mills to elect union representatives. In response, several prominent textile
mills refused to acknowledge the UTW as the workers’ representative in
Clark, Like Night and Day: Unionization in a Southern Mill Town (Chapel Hill: University
of North Carolina Press, 1997).
8 Gordon, New Deals, 204; Harry A. Millis and Emily Clark Brown, From the Wagner Act
to Taft-Hartley: A Study of National Labor Policy and Labor Relations (Chicago: The
University of Chicago Press, 1950), 33–34.
9
Southern Labor under the NRA 99
collective bargaining. To undermine the UTW, mill owners encouraged

employees to join welfare capitalist– style company unions. Southern
industrialists, particularly those in cotton textiles, tended to interpret
Section 7a as recognizing only the collective bargaining rights of workers
in individual mills, to bargain for that mill alone and not for other work-
ers at the same company or in the same industry; industrial unionism,
they argued, received no endorsement in the law. The strike of more than
a quarter-million workers in the summer and fall of 1934, mill owners
argued, resulted not from any honest grievance among their workers, but
from the presence of radicals who took advantage of their labor’s igno-
rance in such matters.9
The NLB exacerbated employers’ frustrations even though the body
lacked sufficient power to force intransigent owners to bargain with
employees. Created in August 1933 by the Department of Labor and
the NRA, the NLB received orders to settle controversies stemming from
different interpretations of the NIRA’s Section 7a. The NLB consisted of
seven members representing labor and capital, including the American
Federation of Labor’s William Green, United Mine Workers (UMW)
President John L. Lewis, and the heads of General Electric, Standard Oil
of New Jersey, and Filene’s of Boston. President Roosevelt appointed the
members and named Senator Robert L. Wagner of New York as chair.
In February 1934, Roosevelt issued an executive order to strengthen the
NLB’s authority to punish employers who did not recognize employee-
chosen representatives for collective bargaining. Manufacturers pro-
tested the strengthening of enforcement mechanisms by the president.
The NAM responded that the NLB interfered with “sound employment
relationships.” Such charges seemed extreme given the continued chal-
lenges to enforcement under the NLB. Despite the prestige and power of
the board’s members, the NLB proved too weak to mediate disputes. Its
members engaged in frequent disagreements with NRA leadership, par-
ticularly with General Hugh Johnson, who had proved to be a friend of
management in labor relations.10
The problems that plagued the NLB did little to lessen southern
manufacturers’ complaints about the body. Chief among the disputes
regarding the NLB was which organizations would be allowed to bar-
gain on behalf of a company’s workers –company unions sanctioned
9 Phillip Wood, Southern Capitalism: The Political Economy of North Carolina 1880–1980

(Durham, NC: Duke University Press, 1986), 67.
Millis and Brown, From the Wagner Act to Taft-Hartley, 23.
10
01
by management or independent, employee- selected unions. Southern

industry considered their region lacking in representation on the NLB as
in the NRA in general. Industrialists insinuated that this lack of balance
weakened their ability to promote the “proper” form of labor represen-
tation for their workers. The NLB proved to be a weak enforcement
mechanism on employer practices –it removed only four Blue Eagles
in its ten-month existence; southern industrialists saw the board as a
harbinger of the treatment the South would receive under New Deal
industrial policy to come.11
SSIC statements continued to invoke the South’s socially and cul-
turally distinct southern labor force and mill village paternalism. SSIC
leaders issued dire warnings of socialist and communist designs on the
part of labor leaders, exaggerating the threat to U.S. institutions and the
South’s “native” labor and raising specters of revolution and disaster
should unions gain a foothold in politics. Nashville Banner editor George
Armistead addressed a gathering of SSIC constituents in February 1934.
His words reflected industrialists’ related attitudes of paternalism, jin-
goism, and fears regarding labor organizing. He praised southern work-
ers’ innate wisdom but cautioned the gathered industrialists that these
employees required guidance. He proclaimed that the South’s workers
produced high-quality leaders and therefore did not require the services
of outside labor organizers who would only undermine local leadership
and stir up trouble and un-American divisiveness. Armistead reinforced
the notion that labor unrest stemmed from outside influences, asking, “Is
it not a suggestive fact that nearly every great labor disturbance in the
last ten years has been fomented by self-imported leaders from the North
and East, or Communists from Russia?” Southern workers, he argued,
required employer- provided opportunities and education to stave off
these disturbances. Armistead touted the paternalism and social control
of the mill village to combat union organizers.12
For SSIC leaders, the primary means to confront these “ravenous pre-
tenders” was to prevent them from being able to lay claim to southern
identity and thereby maintain social order and control of their workforce,
but new arguments began to filter into its publications. SSIC adviser Gus
Dyer worked assiduously to separate labor leaders –outsiders, non-
southerners –from southern workers. Dyer warned against cooperation
11 John Kennedy Ohl, Hugh S. Johnson and the New Deal (Dekalb: Northern Illinois
University Press, 1985), 198.
George H. Armistead, “Address before the Southern States Industrial Council,” Birmin
12
gham, AL, 26 February 1934, SSIC Papers Box 3, Folder 2.

1
0
with labor organizers, denouncing them as “chiselers” disloyal to state

and region and painting southern workers as potential dupes of cunning
outsiders. Dyer called employers the victims of “lawless raids on prop-
erty” provoked among employees by a faulty assumption –a “halluci-
nation” –that employers determined wages. He argued that markets,
not capital or the arbitrary dictates of employers, determined wages, and
honest businessmen should never pay a higher wage than what the mar-
ket dictated. This more stridently anti–New Deal rhetoric existed along-
side southern manufacturers’ cooperative statements about the NRA and
the Democratic Party. Dyer’s statements revealed the lack of agreement
regarding the New Deal among southern manufacturers and their advis-
ers. Manufacturers mobilized to preserve the separate southern labor
market, but they diverged on what policies and protections were nec-
essary to achieve this goal. Dyer, with his warnings about government
intervention in the economy, pushed for an outright anti–New Deal posi-
tion for the organization.13
In his statements, Dyer struck at one of the underlying intentions of
the New Deal: the increase in purchasing power for the average American
worker to combat underconsumption. This motivation, SSIC leaders
believed, represented the interests of northern industry, not southern. Yet
such writings introduced an ideological character that had not existed
in statements regarding the NRA. Only markets could determine prices
and wages, in Dyer’s view, and therefore the task of increasing consump-
tion was outside the purview of government. Dyer’s pronouncements
were a core feature in the SSIC’s public outreach: the organization pub-
lished numerous pamphlets with his writings and sent them to southern
congressional leaders and to thousands of businesses across the South.
Dyer also made frequent public appearances at civic clubs throughout
the SSIC’s territory. SSIC leaders did not see these two approaches to the
NRA as contradictory; they merely saw certain aspects of the law, namely
Section 7a, as violating the principles of associative self-government by
business. As their activism against union organizing revealed, however,
the SSIC and its members relied on a narrow set of arguments, based in
notions of southern culture, to win allies –a losing proposition. Their
motive to preserve the South’s separate labor market offered no palatable
alternative, and they continued to act out of fear that unionism would
interfere with the right to manage.14
Gustavus Dyer, “Collective Bargaining” from The American System of Industrial
13
Freedom and the New Deal, SSIC pamphlet. March 1934, SSIC Papers Box 3, Folder 3.
Ibid. Gordon, New Deals, 236.
14
2
0
1
One incident exemplified the inefficacy of the NRA and NLB and
the intransigence of southern employers in refusing to work with labor
organizations for economic stability. SSIC member firm Harriman
Hosiery Mills in Tennessee, with other textile manufacturers in the
South, began implementing its code’s wage and hour provisions in 1933.
Yet Harriman refused to recognize the employee-elected union sanc-
tioned under Section 7a. Workers in the mill began a strike on October
26, 1933, after which the NLB stepped in to help with negotiations
between labor and management. After appearing several times before
the regional Labor Board in Atlanta and the NLB itself, the company
continued to refuse to recognize any “unapproved” union or to con-
tract, or even enter arbitration, with such a body. Further exhibiting the
difficulty in interpreting Section 7a, Harriman’s general counsel stated
that “collective bargaining does not mean that an agreement is always
arrived at; we may trade, haggle, jockey over terms, but not reach an
agreement.” Their starkly different interpretation of collective bargain-
ing reflected industrialists’ “flexibility” under Section 7a, and thus the
unevenness in its application.15
Despite the NLB’s involvement in negotiations between management
and labor, a deal proved difficult to arrange. On February 2, 1934, the
NLB reprimanded Harriman for bad faith in rejecting “at the eleventh
hour” an agreement with the union. The American Federation of Full
Fashioned Hosiery Workers filed an appeal with President Roosevelt
on behalf of Harriman’s workers in March. Roosevelt notified the
NLB of his “serious concern” over the workers’ charges. He turned
the matter over to the Department of Justice for possible prosecution
and called on the National Compliance Board to review the compa-
ny’s Blue Eagle qualifications. Although the Department of Justice
found no evidence for criminal charges in the union’s accusation that
the mill had abducted union representatives upon the NRA’s removal
of Harriman’s Blue Eagle, the mill announced that it would close its
doors. Critics charged that Harriman shut down to drive off labor
organizers.16
15 “Rejects Offer in Hosiery Strike” New York Times, 13 March 1934. Herman Feldman,
“What is Unionism’s Future? NIRA Raises a Huge Question” New York Times, 4
February 1934. Gordon, New Deals, 206.
Both the Atlanta Labor Board and NLB upheld Harriman workers’ choice of the
16
hosiery union. “Order Prosecution of Harriman Mills: NRA Officials Act on President’s

Instructions Following Charges by Workers” New York Times, 14 March 1934. C.F.
Hughes, “The Merchant’s Point of View,” New York Times, 29 April 1934.

3
0
1
To explain the mill’s closing, the hosiery manufacturer cited order

cancellations by customers because of the Blue Eagle withdrawal, partic-
ularly one order for 30,000 dozen stockings. Mill representatives stated,
“[W]‌e regret we have to close, but the actions of General Johnson and
the NRA have convinced us that they intend to wreck this concern and
make its operation impossible.” Despite the administration’s attempt to
levy a stern punishment on Harriman, the mill received considerable
support from other local merchants. Approximately sixty local busi-
nesses removed the Blue Eagle from their shop windows in solidarity
with Harriman Hosiery Mills. In a telegram to General Johnson and
President Roosevelt, the merchants stated that the mill not only served
as a central feature in the area’s economy, but it had also operated in
compliance with the code provisions. Harriman blamed Section 7a alone
for causing complications. The local merchants declared they would defy
code provisions for their businesses if Harriman remained shut. Closing
the mill, one businessman protested, would ruin the town.17
The Harriman case exhibited not only the NLB’s lack of enforcement
capabilities but also confirmed southern industrialists’ fears regarding
labor and the administration’s recovery program. Harriman’s counsel,
T. Asbury Wright, employed the SSIC’s common refrain about labor
unrest. In a letter to General Johnson, Wright insisted that the Blue Eagle
should be the property of “law abiding” citizens. Instead, unions, he
argued, used the symbol to “browbeat and bulldoze” honorable employ-
ers to bend them to the will of exploitative union organizers. Wright pro-
tested that the AFL, John L. Lewis, and George L. Berry, president of the
International Pressmen and Assistants Union, wielded inordinate influ-
ence on the NLB. That is why, Wright declared, only Pierre DuPont, whose
brother Irénée was in the midst of forming the conservative American
Liberty League, represented industry. The NRA eventually negotiated an
agreement between management and labor at Harriman and reinstated
the company’s Blue Eagle. Nevertheless, within the Roosevelt administra-
tion and Congress, the case sowed doubt about the NLB and NRA’s abil-
ity to secure union representation for industrial workers. By extension,
industrialists doubted the federal government’s ability to adjudicate such
disputes or consider employers’ concerns with fairness. The Harriman
incident also revealed the lengths to which southern manufacturers
17 “Give Up Blue Eagles at Harriman, Tenn.,” New York Times, 27 April 1934; “Harriman
Mills Threaten Closing Over Loss of Eagle” New York Times, 24 June 1934; “Plant
Doors Shut by Harriman Mills as Answer to NRA,” New York Times, 26 June 1934.
4
0
1
would go to preserve local power against the “outside” influence of union

organizers.18
John Edgerton, as SSIC president, took great interest in the Harriman
case, citing the NLB’s lack of fair consideration for employers. In July
1934, Edgerton addressed the council’s constituency, declaring that every
employer of labor in the South should be interested in the trouble at
Harriman. Edgerton considered the removal of the Blue Eagle an exam-
ple of an “unwarranted exercise of arbitrary power,” which violated the
rights of not only the company but also the 623 workers who decided
not to strike. In particular, he resented the request by the NRA to inves-
tigate the mill’s operation and accounts while the Roosevelt adminis-
tration ignored petitions by non-striking employees. Constitutional and
antiunion arguments shaped Edgerton’s rhetoric as he took aim at collec-
tive bargaining, using the divide-and-conquer strategies familiar to mill
owners in their dealings with labor at the plant level. He appealed to the
“best” workers to show their patriotic duty in being reasonable about
wages and hours, but he also issued veiled threats about relocating plants
to places where labor proved more docile.19
Edgerton reserved his sharpest criticism for the bureaucratic process
that he argued had exacerbated the situation. “From my observations
during several visits to NRA headquarters,” Edgerton told his constitu-
ents, “the sole functions of the army of assistants, deputy administrators,
investigators, boards, and committees, which throng the Department of
Commerce Building in wasteful excess of public necessity is to gather
facts, figures, and arguments to support decisions already made by the
Chief administrator or those which he contemplates making.” These
number crunchers, Edgerton charged, merely gathered data to prop
up existing policy, not to seek the truth. The NRA was a bureaucratic
nightmare, he declared, echoing other critics, and it wasted energy and
money on matters with little or no bearing on labor-management rela-
tions. Furthermore, Edgerton argued, the NRA’s actions in the Harriman
case weakened the NRA code structure by undermining individual codes’
authority to rule on wage and hour violations. Edgerton concluded that
18 Ibid. On the American Liberty League’s founding, Phillips-Fein, Invisible Hands, 3–13.
Andrew W. Cohen emphasizes the modern corporate regime’s “violent, contingent, and
contested” emergence. Also, see Cohen for the ethic associations of trade unionism.
Andrew W. Cohen, The Racketeer’s Progress: Chicago and the Struggle for the Modern
American Economy, 1900–1940 (Cambridge: Cambridge University Press, 2004), 2.
“Plant Doors Shut by Harriman Mills as Answer to NRA,” New York Times, 26 June
19
1934. For the strategies used to divide labor, see Kelly, Race, Class, and Power in the
Alabama Coalfields, 1908–21.

5
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1
the NLB violated due process by assuming the role of the judiciary in
hearing evidence, ruling, and meting out punishment to Harriman.20
Edgerton used the Harriman case to further justify the SSIC, which he
hoped would come to represent all southern industry as the NAM did
for national industry. As Edgerton viewed the national situation, north-
ern competitors, whose workers were already unionized or received
higher wages, would find little reason to protest if their southern com-
petitors faced similar pressures, especially given their competitive advan-
tage in labor costs. Edgerton and SSIC leaders declared their continued
commitment to the president’s recovery program but also made their
cooperation conditional on recognition of the South’s differences. They
attributed labor unrest to the troublesome “vocational agitator” led by
a “small, blind and bull headed group of labor leaders.” Strikers’ goal
in the South’s textile plants, Edgerton argued, was to impose a closed
shop on the entire region and to put labor in control of industry. Closed
shops required that all employees join the union, regardless of desire,
augmenting the power of labor to negotiate with management. Edgerton
called upon “enlightened, patriotic, and sober citizens of this country,
and especially of the South,” to stand against “un-American” move-
ments among radical organizers, who he argued stood in the way of
the Roosevelt administration’s recovery efforts. Northern cities might
be lost, in Edgerton’s perspective, but he could still fight to preserve the
South’s separate labor market.21
Some prominent southerners, even those sometimes amenable to
the SSIC’s arguments, found Edgerton’s remarks about labor entirely
farcical, along with the SSIC’s entire approach to carving out “protec-
tions” for the South under the NRA. One newspaper editor objected to
Edgerton’s tactics and suggested that “Mr. E” not rest his case on the
“rather cruel plea that the South should remain unattractive for work-
ers to keep alien people from coming here.” Alabama syndicated colum-
nist and professed (but fair-weather) New Dealer, John Temple Graves
II, after hearing Edgerton warn of the consequences of not heeding the
South’s differences, wrote: “In other words, the southern laborers must
be kept under working conditions so harsh and unattractive that laborers
from elsewhere will have no temptation to move South.” Graves rejected
Edgerton’s recommendations for allowing business leaders alone to
determine wages, hours, and prices, as well as the emphasis on southern
John Edgerton, “The Harriman Trouble and its Implications,” SSIC pamphlet, 24 July
20

Ibid.
21
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1
difference. “[Edgerton’s] idea is a perfect example of a cure being worse

than a disease,” he continued. “There are so many good arguments for
retaining wage differentials for the present that it is amazing to find so
many bad arguments.” Wage differentials might be necessary, and union
organizers might be causing more harm than good, Graves asserted, but
he protested SSIC leaders’ insistence that the South’s deficiencies justified
lower wages and poorer working conditions. The SSIC was not without
allies, but the poor working and living conditions of southern workers
could not be ignored. Competitive advantage might sway management
to thwart labor organizing, but it made for hollow rhetoric in public
debates.22
Even with such warnings against Edgerton’s antilabor crusade emerg-
ing from purported supporters, the SSIC president continued to promote
the image of benevolent southern employers who cared for their work-
ers –this, in contrast to “impersonal” labor-management relations in
the North. He appealed to southern New Dealers, hoping to convince
them that unionization would only harm southern workers by forcing
employers to do away with corporate welfare, such as the employee ben-
efit and savings plans he had implemented at the Lebanon Woolen Mill.
The administration had to side with employers and dispel the agitators
in order for the SSIC to lend its full support to the New Deal. Edgerton
warned that if the administration failed to curb these “self-seeking inter-
ests” by combating the AFL and union organizations’ “special privilege,”
then the New Deal would be “a house of cards built on the sands of injus-
tice.” Any oversight in the quest for economic stability other than asso-
ciative self-government by business, even that of the powerless NLB, was
unacceptable to Edgerton. Though prominent southerners (and potential
supporters) such as Graves rejected such criticisms of the New Deal, as
the administration and Congress addressed the weakness of the NLB in
mid-1934, southern manufacturers continued to turn to their sectional
arguments.23
Alternatives to Section 7a
With daily evidence of the NRA’s impotence, Senator Robert F. Wagner,
a Democrat from New York, attempted to strengthen the NLB’s
22 “A Significant Meeting …,” unnamed editor, 23 May 1934, SSIC Scrapbook 18. John
Temple Graves II, Birmingham Age-Herald, 24 May 1934.
John Edgerton, “The Textile Strike” SSIC pamphlet, 20 August 1934, SSIC Papers Box 3,
23
Folder 2.

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Alternatives to Section 7a 107
enforcement authority. As NLB chairman, Wagner had grown frustrated

with General Johnson and the board’s inability to adjudicate labor dis-
putes and enforce rulings. To combat these problems, Wagner proposed a
Labor Disputes Bill in March 1934 giving the NLB exclusive jurisdiction
over enforcement of Section 7a and the authority to determine whether an
employer should allow one union to represent workers. Wagner designed
the bill to prevent employers from forcing company unions and to ensure
that employers acted in good faith in negotiations. Business leaders mobi-
lized against the bill because they knew that the administration would
have to take some action, given the outbreak of strikes during the spring
of 1934. Despite such business protest, southern employers continued to
differentiate southern labor from the nation’s, dividing business interests
by region. They appealed to workers and politicians as southerners to
block further unionization. Discussions of strengthening labor legislation
heightened regional arguments and separated the SSIC from other poten-
tial allies in business circles.24
The trade-off between economic stability and collective bargaining
became more unbalanced for southern manufacturers as they feared
losing control of labor, even though southern employers were more
successful in blocking union membership. Southern furniture manufac-
turers declared Wagner’s proposal “dangerous.” Furthermore, markets
for furniture remained depressed in 1935, though other industries had
experienced some improvement. Mebane Furniture Company’s president
declared the Wagner proposal as the most extreme, disastrous, and com-
prehensive attack on industry that he had seen. Although he conceded
that the NRA had secured benefits for some industries, he observed no
positive results for the furniture sector. A North Carolina chair manu-
facturer expressed concern for small and medium-sized manufacturers.
Statesville Chair employed between 175 and 200 workers, and its pres-
ident declared that no labor trouble existed in his plant. Rather, “unity”
among workers and employers prevailed despite the Depression; his
employees and stockholders were prepared to suffer together until the
economy improved. The NRA provided adequate protections for labor,
he argued, and workers received a greater share of profits than ever
before. Southern manufacturers uniformly depicted industrial conditions
as harmonious, with union activity only inspired by outside interference.
24 By June 1935, a formal NLRB had removed twenty-four Blue Eagles for Section 7a
violations. With the NIRA’s end, the new Board moved beyond mediation of labor dis-
putes toward stronger enforcement of fair labor practices and representation. Millis and
Brown, From the Wagner Act to Taft-Hartley, 25–26.
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1
Employers appealed to employees through continued paternalistic rhetoric

and a sense of shared cultural tradition. Whether it was employers’ strike-
breaking tactics or the power of workers’ rejection of outside organizers,
the 1934 strikes produced only negligible gains for labor in southern
mills.25
While branding union activists as meddling outsiders, southern
industrialists painted themselves as friends of their honest, God-fearing,
Anglo-Saxon workforce. As long as policies in Washington favored loyal
workers, they argued, there would be no “trouble.” Yet trouble continued,
with tragic results for workers in many instances. J. Spencer Love, whose
North Carolina Burlington Mills saw violent clashes between deputy
sheriffs and striking workers during the 1934 textile strikes, argued that
the NLB under Wagner’s chairmanship caused more labor unrest than
any other agency in history. Love charged Wagner with giving encour-
agement “in all sections of the country to the worst sort of agitators
and racketeers.” Love praised the gains of labor through collective bar-
gaining but also called for gradualism. He affirmed that labor deserved
to achieve better pay, benefits, and working conditions. Nevertheless, he
concluded that private labor organizers fattened their pocketbooks and
might “develop Bolsheviks” out of southern labor. Wagner’s bill, Love
concluded, clothed a political power grab in the guise of “worthy ideals,”
placed undue control of industrial organizations in the hands of labor
organizers, who sought political power, and left workers vulnerable to
exploitation by employers or labor leaders.26
Love, whose family roots were not in the South, epitomized the New
South industrialist of the 1920s. His family established Burlington Mills
to seek profits, using capital from the local Chamber of Commerce, and
benefited from cheap southern labor. The company expanded during the
Depression by expanding production into synthetic silks. He and his allies
relied on maintaining a separate southern labor pool and used social and
cultural arguments to pursue their goal of sustaining the South’s labor
cost advantage, particularly given the region’s few other advantages. Love
had no allegiance to the South’s plantation past or to the Lost Cause; he
25 Gordon, New Deals, 204; Mebane Furniture Company to Bailey, 16 March 1934, Josiah
Bailey Papers, 342. T. G. Shelton to Bailey, 7 April 1934, Josiah Bailey Papers, 343.
Love to Bailey, 16 March 1934, Josiah Bailey Papers, 342; Hall et al., Like a Family,
26
328–342; Burlington Industries, Inc., J. Spencer Love, 1896–1962: The Spencer Love
Story (Burlington, NC: Burlington Industries, 1962). During the 1934 strikes, FDR tried
to aid strikers, and the CTI blocked his efforts. The cotton institute’s power reflected the
NIRA’s limits: it was a cooperation between government and business, and business had
the upper hand.

9
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1
preferred the social control of the mill village because it was efficient and
kept labor costs low. He loathed union organizers because they threat-
ened to upend his source of control, the hierarchical southern social and
class structures, and to raise wages.
Love had allies in his antipathy toward labor organizers and Wagner’s
efforts to strengthen enforcement for collective bargaining. Wagner’s
NLB proposal proved to be the tipping point for many southern industri-
alists in supporting the New Deal. A McEwen Knitting Company official
from North Carolina expressed sympathy with the New Deal’s address
of dire economic conditions, but he could not support Wagner’s proposal
because it would destroy progress toward recovery. Another hosiery man-
ufacturer added, “Wagner’s bill will add very materially to the now back-
breaking burdens which have been placed on our business in the last
year by legislation.” Insufficient time had passed, one textile manufac-
turer professed, for the administration to understand all the implications
of the bill’s proposed measures. “We know that great strides have been
made towards recovery since the inauguration of our President, whom
we all support,” another hosiery manufacturer in Hickory, NC, declared.
This support aside, he charged that Wagner’s bill punished industry and
management and gave labor an unjust advantage. “We know that there
have been abuses in our industrial system,” he explained, “but no such
drastic legislation as the Wagner Bill is necessary to correct the evils.”
Among southern industrialists, even those who lauded New Deal efforts
to date, labor legislation raised concerns for future stability.27
Edgerton envisioned alternate methods to achieve peaceful employer-
employee relations. He based them on his appeal for “social harmony,”
co-opting the language of labor organizers to his own ends. After assert-
ing the Anglo-Saxon character of his workforce and threatening that
immigrant workers would flood the “homogenous South” if labor legis-
lation passed in Congress, Edgerton spent the spring of 1934 attesting to
the successful programs he had implemented in his own mill. Rather than
27 McEwen Knitting to Bailey, 22 March 1934; Thomas Webb, Locke Cotton Mills, Yarns
and Fabrics, Concord NC to Bailey, 26 March 1934; Shelby Cotton Mills to Bailey, 26
March 1934; G&H Hosiery to Bailey, 29 March 1934, Josiah Bailey Papers, 343. The
Federation of Hosiery Workers indicated that their support for the New Deal would be
weakened should Congress fail to show its support for organized labor. “We can assure
you continued success for the NRA and the continued faith and support of labor depends
on the correction of the NRA’s deficiencies, a goal we believe the Wagner bill will accom-
plish. … Deny [dismissed workers’] appeal for relief and their hope and zeal will also be
lost to the ‘New Deal’ ” Federation of Hosiery Workers to Bailey, 26 March 1934, Josiah
Bailey Papers, 343.
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1
recognizing labor’s right to organize, or endorsing legislation to rationalize

and provide clear lines for adjudicating labor disputes, southern industri-
alists emphasized welfare capitalism. In his own company, the Lebanon
Woolen Mill, Edgerton implemented employee benefit programs
including profit sharing, employer-sponsored savings accounts, and –the
most popular practice among other industrialists –weekly prayer ser-
vices. Edgerton even visited England to share his program with other
industrialists, and Manufacturers’ Record featured his efforts.28
Edgerton’s pronouncements regarding his mill management reflected
his underlying belief in the importance of social and cultural common-
alities to a harmonious workforce and economic prosperity; they also
evinced his essentialist view of race. Edgerton predicted a South utterly
undermined and culturally transformed if industry did not receive ade-
quate protections. Workers, he insinuated, “would have to speak 7 or 8
languages,” and southerners would be forced to “accustom ourselves to
alien standards, customs and philosophies.” Edgerton implied that this
state of affairs already existed in northern and midwestern cities, which
had taken a very different path to industrialization. Edgerton believed the
social composition of his mill contributed to his success as an industrial-
ist. He lauded his own program: “As we contemplated,” he gushed, “the
employees go to their work with love and good will in their hearts and
a song upon their lips.” Although his depiction of his workers appeared,
at best, manipulative and misleading, his views coincided with the selec-
tive employment practices of southern employers, who hired African
Americans, generally speaking, for only the most menial positions.29
Industrialists who extolled the virtues of paternalism and business
progressivism believed tranquility in their plants depended on ethnic
and social homogeneity; not coincidentally, manufacturers also often
exploited racial divisions in labor to thwart early efforts at unioniza-
tion. By building industry out of a war-ravaged region, a New South
Stuart Brandes, American Welfare Capitalism, 1880–1940 (Chicago: The University of

28
Chicago Press, 1970), 5–6; Sanford M. Jacoby, Modern Manors: Welfare Capitalism
since the New Deal (Princeton, NJ: Princeton University Press, 1997); Klein, For All
These Rights, 54; “Edgerton Workers Hold Chapel Service in Factory Daily,” Atlanta
Journal, 20 May 1934.
“A Significant Meeting…,” unnamed editor, 23 May 1934, SSIC Scrapbook 18. In 1954,
29
under the leadership of Edgerton’s brother, the only black employees at the Lebanon
Woolen Mill occupied the janitorial staff. Anecdotal evidence suggests that by the mid-
1960s the Lebanon Woolen Mill employed mostly black women in spinning, rewinding,
and weaving. Lebanon Woolen Mill 50th Anniversary Annual, 1954, author’s personal
collection.
1
had emerged, and manufacturers alone, as Edgerton suggested, echoing

decades of New South booster rhetoric, had provided uplift for the
poverty-stricken South. Interference in industry’s ability to dole out ben-
efits to “deserving” workers threatened more than the South’s economic
future, Edgerton warned; interference endangered the region’s culture.
Labor policy struck directly at the heart of southern mill owners’ man-
agement practices. If workers could organize for better wages and work-
ing conditions and break free of the mill village, manufacturers’ methods
of social and economic control would be undermined.30
The defeat of Wagner’s preliminary bill in June relieved industri-
alists, but their respite was short-lived. The president signed Public
Resolution No. 44 (H.J. Res. 345, 73rd Congress), a compromise mea-
sure that preserved workers’ right to strike and allowed the president
to create boards to oversee disputes under Section 7a of the NIRA and
facilitate mediation. Soon after, the president signed an executive order
abolishing the NLB and implementing the National Labor Relations
Board (NLRB), which decentralized labor boards and oversight. Varied
interpretations of labor law emerged, enforcement continued to be
weak, and problems beset the program. Senator Wagner drafted leg-
islation that would establish a national labor policy that stood fully
behind the rights of labor and thwart employers’ traditional methods
for preventing unionization. Edgerton’s belief that the administration
sought to upend southern social arrangements remained a central
feature of SSIC publications and pronouncements. Edgerton warned
southern manufacturers that “unless the intelligent interest of the
South awakes, and awakes quickly, to the situation that confronts it in
these peculiar ways, the influences tending to destroy our industry and
make impossible the South’s future development will soon be beyond
control.”31
Edgerton’s remarks reflected manufacturers’ desire to maintain con-
trol over economic development in the South and the direction of capital
investment. Labor legislation threatened not just industry’s profitability
based on cheap labor. The proposed bill endangered the South’s separate
labor market, and few possibilities to limit the law’s application emerged,
unlike in the case of wage differentials under the NRA or with the weak
enforcement power of the NLB. The Wagner Act also revealed the SSIC’s
limits of sectionalism. Edgerton resolved to build a more comprehensive,
Flamming, Creating the Modern South.

30
Edgerton to SSIC constituency, 20 June 1934, SSIC Papers Box 3, Folder 3.

31
2
1
antistatist platform for his fledgling organization, grounding his rhetoric

in a mix of economic and cultural arguments.32
The SSIC after the Wagner Act

In July 1935, President Roosevelt signed Wagner’s NLRA into law. The
Wagner Act provided protection for workers to organize as well as clear
definitions of unfair practices on the part of employers, strengthening
the rights established in Section 7a. Paradoxical arguments emerged in
response to the law. Developments within the labor movement toward
industrial unionism based on individual merit and less on “customary
power and prestige” based on racial and ethnic community traditions
further challenged the efficacy of standing welfare capitalist practices. In
the South, employers’ tactic was to use white racial and social solidarity
to prevent unionization. The end of the NRA, though its demise had been
orchestrated by business interests, ushered in a stronger, labor-backed
demand for a welfare state that would also facilitate consumption for
workers.33
The Wagner Act also provided clear means for enforcement, not just
mediation, in the matter of labor disputes. SSIC leaders invoked the
same paradoxical arguments to prevent unionization in southern indus-
tries that they had honed under the NRA. In doing so, they revealed the
increasing difficulty of maintaining traditional modes of life while pro-
moting the modernization of the southern economy. On the one hand,
they claimed to disdain the “paternalism” of labor unions that assumed
the ignorance of southern workers; on the other hand, they attempted
to implement their own form of “protection” of seemingly defenseless
employees. Not only were southern employees “predominantly of one
blood, of one God, and of one flag,” as Edgerton repeatedly asserted, but
SSIC leaders also declared that the South was the repository of the most
32 Millis and Brown, From the Wagner Act to Taft-Hartley, 25–26. Southern workers were
not unified in their preferences for or against unions. Rather, workers tended to be polar-
ized over unionization, even in the same mill village, and often drew distinctions between
themselves and outsiders. Flamming, Creating the Modern South, 208.
The welfare state facilitated cooperation among corporate managers and industrial
33
unions, eclipsing the former “labor question” that had driven the antiunion activism of
groups like the NAM. Steve Fraser, “The ‘Labor Question,’ ” in Fraser and Gerstle, The
Rise and Fall of the New Deal Order, 66–68, 77. Colin Gordon argues another paradox
existed: the Wagner Act reflected business politics and demands for economic stability;
the New Deal was not necessarily antibusiness even if business rejected its proposals.
Instead, business protested the Wagner Act “because they could not agree among them-
selves over the utility and costs of unionization.” Gordon, New Deals, 238.

3
1
The SSIC after the Wagner Act 113
“truly American” values. Such values, they declared, would prevent the
South’s “native labor” from turning to unions for representation.34
Such pronouncements were more assertions of hope than belief, since
manufacturers knew that a majority of southern workers supported
the New Deal and the president. The SSIC’s antilabor spokesmen tried
to paint union organizers as un-American, revisiting the kind of jingo-
istic rhetoric Edgerton used in the 1920s as NAM president, when he
earned his reputation as an enemy of union activity. Union organizers,
he argued, who came from “other sections,” were “composed largely of
foreign elements who do not understand and are not sympathetic with
our American institutions.” SSIC pamphlets proclaimed the need to pro-
tect southern labor “against the manipulation and exploitation of any
Organized Labor Aristocracy” and to vigorously preserve “harmonious
and mutually profitable relations between employers and employees.” In
the eyes of SSIC writers, southern industry had already expended suffi-
cient effort and made enough concessions to attract and support its work-
force; any further allowance for the activities of unions would undermine
their relationship with workers.35
Employers invoked paternalism, claiming they defended southern
labor, but also insisted that southern labor was savvy and able to nav-
igate the complexities of the modern shop floor. Eliding these inconsis-
tencies, Edgerton and the SSIC created a dramatic image of a unionized
southern workforce. They based such arguments on more than fears of
racial mixing or social change: they believed that the South’s ability to
industrialize and develop economically depended on the regional labor
market, which collective bargaining would undermine. Beyond the shrill,
reactionary criticism of unions, the SSIC’s interpretations of labor linked,
inextricably, notions of social homogeneity and economic advantage.
They nevertheless developed a trenchant critique of collective bargaining.
Southern manufacturers’ paternalistic rhetoric alienated potential
political allies. Senator Wagner calculated that excluding agricultural
workers from the bill, though he regretted the decision, would keep
southern Democrats on board –and he was correct. The House required
only a voice vote to pass the bill, though some southern Democrats
abstained. The vote was 63-12 in the Senate. Edgerton’s invocation of a
separate South precluded any possible collaboration with non-southern
Southern States Industrial Council Declaration of Policy, 28 December 1934, SSIC

34

Ibid.
35
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1
conservatives. Southern manufacturers’ emphasis on southern traditions,

a separate economy, and worker docility exacerbated regional political
divisions.36
Rather than mobilizing a broad nationwide conservative opposition
to the Wagner Act, the SSIC leaders relied upon and promoted regional
differences. SSIC leaders and membership sharply distinguished south-
ern labor from northern and depicted their region as a stronghold of
independent thought. The South, unlike the North, they contended, was
uniquely qualified to resist such legislation. Indeed, by the end of 1935,
after a meeting of more than 500 southern industrialists in Birmingham,
the SSIC leadership concluded that “the South … can still speak with-
out fear of loss of some material advantage,” unlike northern companies,
which southern manufacturers saw as in the grip of labor organizers.
Southern manufacturers, SSIC leaders believed, would have to pursue
their own case against the Wagner Act.37
The Wagner Act’s southern critics sent a stream of letters to congressio-
nal offices protesting the law’s “one-sided” nature. Prior to 1935, workers
struggled to establish a uniform right to organize for better wages, hours,
or working conditions, but manufacturers argued that this bill privileged
the rights of workers over the rights of management. The industrialists
based their argument on the prohibition of particular tactics that employ-
ers used to circumvent outside union activity in their plants. In particular,
the NLRA prohibited yellow-dog contracts, in which workers agreed not
to join a union; it also outlawed specific interferences with “the right of
workers to choose their own collective bargaining representatives,” such
as the formation of company unions without a vote. Wagner Act critics
saw these measures as applying specific limits to employers, while allowing
employees not just the right to strike but the ability to negotiate all aspects
of employment contracts. As a Thomasville, North Carolina furniture
manufacturer explained, “The bill is one sided, because in effect it restrains
the employer from interfering with the organization of his employees, but
at the same time it does not restrain the racketeering labor organizations
Congressional Record-74th – 1st Session, 19 April 1935 (Washington, D.C.: Government

36
Printing Office, 1935 6014.

Southern solidarity was not necessary to pass the Wagner Act, but it became more import-
37
ant in blocking the Tydings Amendment, which would have undermined the closed shop
and limited union power. Key southern Democrats blocked the amendment, with only
Bailey, Byrd, Glass, and McKellar voting for it. Katznelson, Fear Itself, 259. For more
on senate opposition, see Lichtenstein, Labor’s War at Home, 128; John Edgerton, “A
Significant Meeting and Some Afterthoughts,” to SSIC constituency, 23 December 1935,
SSIC Papers Box 3, Folder 2.

5
1
from coercing the employees into joining certain labor unions.” Southern
employers criticized the Wagner Act, as other business leaders did, for cre-
ating uneven power for workers at the expense of employers. But beyond
this legislative critique, southern manufacturers worried more that the bill
would undermine their unofficial, locally based methods of labor control.38
Many southern textile manufacturers remained bitter after the UTW’s
organizing effort in 1934. “Flying squadrons” of hundreds and occa-
sionally thousands of textile workers traveled the South’s highways to
spread the strike information, closing down several mills. Alarmed by the
strikes, the North Carolina manufacturer foresaw demonstrations in his
own plant as the natural result of allowing union organizations to con-
tinue their activities. Looking back at the textile strikes, the manufacturer
surmised, “These [outsiders] undertook to go into peaceful communities
and force employees to strike.” He argued that the Wagner Act would not
control the more violent, radical purveyors of unionism and would harm
the honest workers seeking to sign contracts with employers. Southern
industrialists contended that the NLRA removed employers’ right to pre-
vent outsiders from organizing workers, and manufacturers attempted to
distribute this message widely.39
SSIC leaders used their organization’s access to the management offices
of southern plants to distribute publications declaring that the NLRA
violated the constitutionally defined division of powers. The SSIC issued
a pamphlet entitled “The Wagner Monstrosity and Its Implications,”
which the Nashville office sent to more than 10,000 employers in the
South. It asked, “What are we going to do about it?” The publication
called the bill “the most audacious test applied to the common people’s
capacity for indignation,” and declared that it “will fall heaviest on this
section, as was intended.” Although the authors suggested no remedies,
SSIC leaders argued that the NLRB granted unconstitutional power to
bureaucrats, who had the ability to investigate, decide, and enforce rul-
ings on employers.40
38 Standard Chair Company to Franklin Roosevelt and Bailey, 20 April 1935, Josiah Bailey
Papers, 345. Salmond, The General Textile Strike of 1934, 46–47.
Janet Irons explained the tension between union organizers and textile manufactur-
39
ers: “[T]‌he flying squadrons also provoked a powerful response from mill owners, who
flooded the offices of southern governors with telegrams describing the strikers as ‘ruth-
less marauders’ who went from mill to mill ‘crushing doors, pulling switches, blocking
gates, intimidating and closing plants,’ creating a ‘reign of terror’ in the South.” Irons,
Testing the New Deal, 128.
“The Wagner Monstrosity and Its Implications: What Are We Going to Do About It?,” 5
40
July 1935, SSIC Papers Box 3, Folder 2.

6
1
The SSIC also tried to reach workers directly. The organization took
it upon itself to “educate” southern labor about the threat to freedom
that unions posed in a series of pamphlets for members to include in
employees’ pay envelopes. Southern labor, the SSIC contended, should
understand how unions enslaved workers for the “benefit of a few.” These
pamphlets also declared employers’ commitment to abide by the NRA’s
provisions. The pamphlets’ primary purposes, however, were to decry
union’s empty promises and to caution that there was “no more marked
degree of ‘bondage’ than that of membership in a labor organization.”
The SSIC sought to turn southern workers against union leaders not only
by comparing them to slave masters but also explaining, “A labor union
is good only for the officers or executives in charge, who reap the greatest
benefits and who render the smallest service. Southern Labor is succeed-
ing, and is happy in its success, because of the principle of the freedom of
contract which it has enjoyed.” How many of these pamphlets actually
reached workers’ pay envelopes is unclear, but these efforts to influence
workers suggest that the SSIC sought allies beyond elite circles.41
SSIC leaders believed in the power of mill village paternalism. As one
official commented at the SSIC’s annual meeting in 1935, “Let us quit
thinking of ourselves as ‘the industrialists.’ Every person engaged by and
with us in the employment of a joint industrial operation is much enti-
tled to the distinction.” Such a sentiment, perhaps noble in appearance,
suggested that the SSIC’s search for allies and the organization’s poor
position in public opinion –and increasingly in the mill village itself –
exposed industrialists’ inability to look beyond their social power to con-
trol workers and sway policy.42
SSIC leaders reaffirmed their organization’s importance in influenc-
ing the region’s political representatives. The SSIC wagered that unity
of southern labor and employers, as well as the region’s social character,
would unite political resistance to the New Deal’s expansion. Leaders
promoted the council as “a medium through which its industry and busi-
ness can speak with one voice.” Racial unity, council spokesmen argued,
trumped any divisions between white southerners, economic or other-
wise. Racial unity had, since the days after Reconstruction, translated
into partisan unity at the national level in the South. The New Deal, par-
ticularly the NIRA’s Section 7a and the Wagner Act, had shaken the faith
Ibid.
41
42 Annual meeting minutes, 15 December 1935; John Edgerton, “What is His Record,” 7
January 1936, SSIC Papers Box 3, Folder 2.

7
1
of the Democratic Party’s most ardent southern supporters. Although

himself a Hoovercrat, Edgerton explained, “Many have felt so humiliated
and betrayed by their [Democratic] party that they couldn’t talk without
gulping apology.” The council’s president hoped to rely on social and cul-
tural sentiments to encourage his organization’s constituents to pressure
their representatives.43
SSIC public statements took a strongly critical stance on the Wagner
act and, in private, SSIC leaders revealed that they rejected the New Deal
entirely. Gone were the pronouncements of goodwill and cooperation of
1934. The council’s secretary, C. C. Gilbert, protested the broad powers
granted to the NLRB and warned that it would subject employers to
unjust investigation and waste resources attempting to regulate peaceful
workers. When the House passed the Wagner Bill, Edgerton complained
that the bill “illustrates [the] damnable species of politics by which our
country is now governed,” indicating his belief that the administration
and Congress had gone past the brink and would not be able to win
back the support of southern industrialists. Only cooperation between
southern employers and employees could possibly scale back such legis-
lation, and Edgerton hoped the SSIC could further such cooperation as
common cause.44
Yet the SSIC showed no signs of supporting efforts, spearheaded by
the DuPont-backed American Liberty League, to challenge Roosevelt in
1936. SSIC leaders still looked to the Democrats, hoping to work within
the party to turn back the New Deal. At the SSIC’s annual meeting in
1935, Edgerton declared confidently, “There has never been any question
as to what the real Anglo-Saxon South thinks about most of what has
been going on in the name of the political party which it has nurtured
so long. It has been only a question of developing in the face of many
discouragements the courage to express its untrammeled thoughts.” After
congratulating himself and his organization for their courage, Edgerton
stated his true purpose. Southern industrialists, he asserted, needed to
reclaim the Democratic Party, “which was born of the womb of the South
“What Is His Record,”; “A Significant Meeting.” Edgerton also blamed on fear and greed
43
among many southerners for their passive acceptance of New Deal plans. “Many, of
course, have been profiting directly as office and job holders, while many more have been
actually feeding at the lavish hand of government. These can hardly be expected to bite
the hand that feeds them. Others are afraid of political reprisal which is always common
to the period in any nation’s life when the liberties of the people are succumbing to the
encroachments of autocratic powers. Many are the fears that are felt as democracies
perish and constitutions crumble.”
Edgerton to Gilbert, 21 June 1935, Donald Comer Papers 7.124.14.
44
8
1
and nurtured at its breast.” In order for the party to reclaim southern
industrialists as enthusiastic supporters, Edgerton predicted, “it will be
obviously necessary for the people of this deluded section to rise up in
their pride and indignation, and demand without compromise that the
party renounce its treacherous cohabitations with socialists and reds.”
His condemnation of the South for voting solidly with the New Deal
elided any argument that southerners welcomed reform. He asserted that
the Democratic Party should “return to the platform with which it won
the confidence of the people, and reaffirm its faith in American institu-
tions including the sanctity of a solemn oath.”45
Several prominent southerners looked upon the SSIC with wariness
and expressed their feelings in public. Birmingham columnist John Temple
Graves II considered himself a New Dealer and criticized the SSIC for its
strident rhetoric. To avoid ignoring the SSIC altogether without embrac-
ing the council as the sole representative of business, Graves critiqued
the SSIC in his weekly syndicated column. “This column has too many
friends in business,” he wrote, “and too sincere an appreciation of what
business men have accomplished for this country not to deplore the lead-
ership which is taking them today into a political struggle for which they
have obviously so little talent.” Graves admitted the New Deal’s “vulner-
ability” in many respects, but he declared that deploying the SSIC’s strat-
egies big business would “defeat its own ends and … help the very parties
it is meant to hurt.” He argued that American businessmen, including
southern industrialists, seemed not to have learned the lessons of the col-
lapse of 1929, and had not yet realized the “ ‘crack-pottery’ that went on
in the days of wild prosperity.” The SSIC represented, Graves asserted, a
persistent resistance to recognition of “problems that persist today and
safeguards that need to be taken for tomorrow.” Such sentiments revealed
that the South’s industrial leaders might win allies on certain issues but
that southern politics had not reorganized into pro–and anti–New Deal
camps – yet.46
For their part, labor organizations and their press offered scathing
criticism of the SSIC. The Muscle Shoals Labor Advocate named John
Edgerton a “Labor Hater,” who drew his terminology from “the old lexi-
con” of the NAM. When Edgerton called for a regional wage differential
to protect the South’s competitive advantage, the Nashville-based Labor
45 “A Significant Meeting,” 23 December 1935; “What Is the SSIC,” SSIC pamphlet,

September 1935, SSIC Papers Box 3, Folder 2.
John Temple Graves II, “This Morning,” Birmingham Age-Herald, syndicated. 18
46
December 1935.

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1
Advocate, another union publication, interpreted his remarks as demands

for “more and more ‘stretch out.’ ” In the SSIC complaints against dis-
criminatory freight rates, the labor publication saw a desire for Congress
to support pet projects in the South. The SSIC sought to “Arouse the
South to fight for its logical industrial development –for there are still
many ‘poor whites’ left.” The Labor Advocate reported on Gus Dyer’s
January 1936 talk regarding worker protections before a Chamber of
Commerce meeting. The Chamber met to discuss an organizing drive
by the Tennessee Federation of Labor. The Advocate, in tongue-in-cheek
style, reported: “Summed up, Dr. Dyer’s constructive remarks were as
follows: [long blank paragraph].” Following the blank space, the reporter
added, “Charles C. Gilbert, secretary of the Tennessee Manufacturers
Association [and SSIC Secretary], spoke, and added nothing to Dr. Dyer’s
constructive remarks above.” Both the SSIC and labor organizations saw
no meaningful dialog forthcoming between employers and employees.
The SSIC treated labor organizations as conniving and un-American;
labor unions saw the SSIC as seeking only to further exploit labor and
increase profit margins.47
The Wagner Act precipitated a shift in SSIC tactics toward building
public appeal and stronger alliances. In a public relations campaign that
included employer- distributed pamphlets, newspaper editorials, and
speeches at local chambers of commerce, auxiliary clubs, and Kiwanis
meetings, southern industrialists struggled to convince southern employ-
ers and their labor force that management had employees’ best inter-
ests at heart. Although SSIC leaders failed to mount a collective southern
industrial campaign to oust labor organizers from their region, individual
mill owners proved successful in thwarting unionization, and southern
workers often rejected union membership. Despite the strikes of 1936
and 1937 and the CIO’s growth in the region, labor organizers never
posed a significant challenge to southern industrial arrangements.
After several campaigns, using southern organizers whenever possi-
ble, the Textile Workers’ Organizing Committee reported that 15,000
southern cotton mill hands –roughly 20 percent –had joined the union,
but only 15 percent of those members paid dues consistently. Southern
UTW members rarely worked in closed shops, and employers regularly
submitted complaints about the union to the NLRB. CIO organizers
experienced somewhat greater success in Alabama’s iron and steel plants,
47 “7 Points in ‘Labor Hating’, Muscle Shoals Labor Advocate, January 1936. “Dr. Dyer
Would ‘Protect Workers’ ” Labor Advocate (Nashville, TN), 13 August 1936.
0
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but racial antagonism hampered any unity among workers. From SSIC
leaders’ point of view, southern workers preferred private, welfare-
capitalist programs despite the lack of evidence at the polls that southern
workers rejected the New Deal.48
Questioning the Democrats

Southern manufacturers grew restless within the Democratic Party,
despite the SSIC’s efforts to reclaim it. Although many of Dixie’s congres-
sional leaders largely concurred with the SSIC’s depiction of southern dis-
crimination, votes on New Deal legislation continued to include southern
yeas. As the vote for the Wagner Act revealed, southern Democrats lined
up behind New Deal initiatives so long as they did not undermine white
supremacy. Conservative southern Democrats limited reform, though not
to the extent that manufacturers wished. SSIC leaders watched the emerg-
ing conservative coalition in Congress with interest, cheering southern
congressional leaders who criticized the administration. Yet few issues
emerged to cause politicians to reject entirely the slate of policies emanat-
ing from Washington, and the SSIC grew increasingly frustrated with the
Democrats. One member explained, “I have been voting the Democratic
ticket a little longer than FDR, but I am tired and earthly sick of see-
ing this Republic plunging headlong into hell upon the instructions of a
gang of experimenting brain trusters handed to a rubber-stamp Congress
through the medium of President Roosevelt.”49
Throughout the debates over labor legislation and the NRA’s reorga-
nization, southern industrialists proved the most willing among the polit-
ically active citizens in the South –those who were not disenfranchised
by Jim Crow laws and other methods –to abandon the old Democratic
Party. Although the New Deal would leave the region’s political arrange-
ments intact, the early intransigence of southern industrialists indicated
their willingness to abandon traditional party affiliation.
Some southern elites considered leaving the party early on. Edgerton,
along with other prominent business leaders, publicly supported Hoover in
1928, having seen the New York Catholic Al Smith as a wholly unsuitable
48 Marshall, Labor in the South, 171, 188. Judith Stein, “Southern Workers in National
Unions: Birmingham Steel Workers, 1936– 1951” in Robert Zieger, ed., Organized
Labor in the Twentieth-Century South (Knoxville: University of Tennessee Press, 1991),
183–222.
Grantham, The South in Modern America, 133–134; Hughes & Ray to Bailey, 25 May
49
1935, Josiah Bailey Papers, 346.

1
2
Questioning the Democrats 121
candidate. Regional and cultural tensions divided the Democratic Party

in the 1920s, but the Depression and the New Deal introduced reasons
for elite white southerners to abandon the party permanently. By 1936,
pronouncements declaring the Democratic Party as hopeless grew more
frequent and public. James Stahlman, Nashville Banner publisher and
strong SSIC supporter, indicated his discontent with the Democrats when
he declared, “There isn’t any chance of cleaning up the Democratic Party
from within.” He pointed specifically to the influence of northern, urban
areas on the party. “It has been Tammanyized to the last precinct,” he
declared, referring to the Party’s growing base among northern and urban
labor. He included the president on the list of troublemakers, concluding,
“There is no longer the Democratic Party of Jefferson and Jackson. It is
the radical party of Roosevelt, Farley, Frankfurter, Tugwell, and Wallace.”
Southern industrialists likewise resented Roosevelt’s advisers and their
experiments in reform, particularly as they affected the South.50
During the buildup to the 1936 presidential election, Stahlman
observed these loosening ties. He told a Portland, Oregon newspaper edi-
tor, “There is tremendous opposition [to FDR] in a number of quarters,
leading off with the business element, of course. The lawyers and pro-
fessional people are also against him and while their votes won’t change
any of the Southern electoral votes, Roosevelt will not get the popular
vote in this territory as he did four years ago.” Stahlman expanded on
his sentiments in a letter to Vice President John Nance Garner, who
favored a balanced budget. “It seems to me the Southern conservatives
are being played for prize suckers,” Stahlman declared, with charac-
teristic bombast. He suggested the possibility that certain political ele-
ments within and outside the South preferred a Labor Party and would
leave the Democratic Party to the conservatives. He further insisted that
50 In 1928, the Tennessee State Republican Headquarters reported to Hoover’s campaign

that Edgerton, a “prominent Democrat, is strongly in favor of Mr. Hoover for president.”
The letter named Edgerton as a personal acquaintance of Hoover’s, as Edgerton had
served on the Food Administration and various committees while Hoover was Secretary
of Commerce. Edgerton pledged, if Hoover would send a personal request, to use his
public position to speak on behalf of the Republican. Despite his “lifelong affiliation
with and attachment to the Democratic Party,” Edgerton supported Hoover. Col. H. A.
Mann to Hoover, 1 September 1928, Campaign and Transition, Box 20; Edgerton to
Hoover, 2 September 1928, Campaign and Transition, Box 20; Hoover Papers; Hoover
Library. James Stahlman to Robert L. Garner, 25 July 1936, James G. Stahlman Papers
Box VIII, Folder 1. Vanderbilt University Special Collections, Nashville, TN, (hereafter
cited as Stahlman Papers). The inclusion of Frankfurter is somewhat anomalous, given
that when FDR appointed Frankfurter to the Supreme Court in 1938, he proved to be
more conservative than other justices and often extolled a balanced budget.
21
conservatives look beyond historical allegiances and declared, “If southern

conservatives insist on living in the past, they can retain a few high
sounding principles but I think they will be of no importance in the fight
between the newly aligned conservatives and radical groups.” The SSIC
attempted to remain nonpartisan, and in the 1930s its leaders did refrain
from endorsing political candidates. Nevertheless, they endorsed conser-
vative resistance to New Deal programs and legislation.51
Despite Roosevelt’s landslide reelection, southern conservatives
expanded their resistance after the election. On January 20, 1937, Franklin
Roosevelt was sworn in for his second term. He immediately took aim
at the Supreme Court, which had struck down several of his New Deal
initiatives. Less than a month after inauguration, he announced his plan
to expand the Supreme Court from nine to fifteen judges. Opponents
accused him of trying to “pack the court” so it would be more favor-
able to New Deal legislation. The Senate rejected the bill in July, but
the measure lived on as an example of New Deal overreach. The SSIC’s
political stance against “radical” measures strengthened with Roosevelt’s
campaign to reorganize the Supreme Court. Edgerton condemned the
president’s plan in several southern newspapers as an attempt to “cud-
gel” the court into acquiescence. Edgerton declared, “No such mandate
has been given to anybody. No matter how sympathetic he may be with
the general policies of the present administration, or with its high objec-
tives, no member of the US Congress who has his country’s welfare at
heart will look at this revolutionary proposal from a partisan, political
viewpoint.” Not even the most dedicated New Dealer, from Edgerton’s
perspective, should support such methods. Edgerton praised Senator
Carter Glass in particular for his stance against the court reorganization
plan, but the SSIC president also attempted to appear above the political
fray. Supporters of organized labor were proponents of “Communism,
Fascism, and Nazism” and spread prejudice and intolerance, Edgerton
argued.
Other southerners, particularly in the Deep South, feared the decamp-
ing of business from the Democratic Party. Frederick Sullens, editor at
Mississippi’s Jackson Daily News, renounced the idea that the South
might abandon the Democrats as a result of labor legislation. “Edgerton
Stahlman’s predictions proved entirely erroneous. In Mississippi, fewer than 5,000 of

51
the state’s approximately 163,000 voters supported the Republican ticket. In Tennessee,
Stahlman’s home state, Landon fared better, but still 68 percent of Volunteers voted FDR.
James Stahlman to Donald J. Sterling, 4 August 1936, Stahlman Papers VIII-1. Stahlman
to John Nance Garner, 19 August 1936, Stahlman Papers VIII-5, 6.

3
2
1
of SSIC is doing some rampaging against what President Roosevelt wants

to do to the US Supreme court,” he wrote. “This is the same President
Edgerton who was rampaging against FDR last year. Not much of his
propaganda gets into print. The South is still solidly Democratic.” In this
case, Sullens seemed to protest too much, lending credence to the idea that
political change was possible as a result of New Deal antipathy in south-
ern sectors. He gleaned –correctly –that southern business leaders would
vote with the GOP if a suitable candidate emerged. The editor rejoined
his statements later in the month, declaring, “Mr. Edgerton, you flood the
desk of the editor twice per week with your ignorant thoughts. Right at
this moment of writing you are mildly suspected of being a Republican.”
Defenders of white supremacy and Jim Crow, such as Sullens, remained
tied to the Democrats and only protested when Congress attempted to
address lynching in the South.52
Nonetheless, Edgerton focused on southern Democrats as the means
for pushing back the New Deal. The SSIC president depicted southern
congressional representatives as soldiers in a battle for the core values
of the South and the nation. He established committees of industrial-
ists in each congressional district to influence representatives. With his
experience as head of a missionary committee for the United Methodist
Church and his record of implementing religious services in his own mill,
Edgerton called upon industrialists to serve social needs through their
local churches. He was shocked by attitudes on display toward religion
during his testimony before the House and Senate Labor Committees’
joint session on the pending Fair Labor Standards Act (FLSA) in June
1937. Edgerton declared, “The slightest reference to the church or to any-
thing of a sacred nature brought smiles of derision to the faces of a few
members of the committees, and titters from the vocational claque which
attends such hearings.” The SSIC president interpreted his cold reception
Edgerton invoked the founding fathers in making his appeal. “The spirit of partisanship,
52
against which George Washington inveighed so earnestly in his Farewell Address, was
never so rife in our nation as it is today, and has been during the past few years. That fact
constitutes the chief obstacle to sane solutions of our national problems. In this writer’s
view, no person is capable of clear thought or safe leadership whose heart is full of hatred
or the essence of prejudice and intolerance.” Edgerton to SSIC constituency, 30 June
1937, Donald Comer Papers 7.131.11; John Edgerton, “Against the Plan,” 11 February
1937. Appeared in Gastonia Gazette, Nashville Banner, Knoxville Journal, Johnson City
Press, Jackson Sun, Columbus News Record. Frederick Sullens, “The Lowdown on the
Higher Ups,” Jackson Daily News; “He’s Bellyaching,” Jackson Daily News (Jackson,
MS), 24 February 1937. Sullens had a reputation as a virulent white supremacist, and
he represented the reactionary southern populist who looked warily at industrialists’
intentions.
4
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1
as the result of “not only an appallingly impoverished mental condition,

but a spirit of cynicism indigenous to Communistic soils.” Edgerton asked
his constituents in the SSIC to provide their elected officials with “infor-
mation and moral support” to protect the people “against all dangers
that threaten.” The stakes, as Edgerton depicted them, included not only
the South’s industrial prosperity but the very heart and soul of American
democracy.53
Other southern voices looked for accord among advocates for the
South’s economic prosperity. John Temple Graves II attempted to call for a
united front in the face of southern industrial and agricultural woes. Such
a front could produce sane, practical recommendations to the region’s poli-
ticians. Though he often criticized the SSIC, he did not want the Democrats
to lose the backing of business. Graves lamented, “The political solidarity
of the section does not prevent the existence of a great schism with respect
to the economic policies of the new deal; most of the economically pow-
erful hate the policies like poison and most of the politically powerful are
faithful to them unto death.” He declared that the SSIC, under the “genius”
of John Edgerton’s leadership, proved “effective in the interests of Southern
industry but is too honestly hostile to most of the new deal economics and
to the union labor development to lie down with the other myriad lambs
of other persuasions.” The possibility of cooperation and compromise,
by 1937, seemed distant, and the lack of unity among southerners might
destroy the region’s political power, Edgerton feared.54
SSIC membership rose steeply, coinciding with southern industrialists’
resistance to the Wagner Act. The council neither required nor requested
annual dues and sent its literature and announcements to any firm or indi-
vidual who requested materials. The SSIC did solicit and receive funds,
amounting to sums from $5 per year to $500 and upward. The number of
regular subscribers nearly doubled from 653 to 1,186 between 1935 and
53 Ibid. Legislative correspondence from SSIC members across issues bears remarkable sim-
ilarity. Each member of congress in SSIC member areas received statements; letters from
industrial constituents often used language similar to that which appeared in official
SSIC statements. Though it is difficult to trace a direct influence, and the similarities
also reflect similar interests rather than directives, it is clear that the SSIC embodied and
amplified a similar message as industrialists across the South, and organized their col-
lective voice into an interest group that reached into the offices of legislators across the
South with common voice.
Graves lamented the “million interests of the different parts and groups of the South,
54
intervening wherever possible to prevent competition among the parts from destroying
or limiting the whole.” John Temple Graves II, “The South Today: A Southern Regional
Clearing House” Southern Newspaper Syndicate, 11 July 1937, SSIC Scrapbook, Vol. 16.

5
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1
Donations to SSIC, 1934–1938
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
$0
1934 1935 1936 1937 1938
Textiles Total Donations
Figure 2 Total donations to SSIC, 1934–1938.
Source: By the author. Data courtesy of Tennessee State Library and Archives,
Account Books (compiled).
1937, as southern industrialists learned what services and opinions the

council rendered. SSIC leaders testified that the organization had between
6,000 and 8,000 members, although this estimate likely represented the
SSIC’s mailing list rather than regular donors. The SSIC could obfuscate
on this point given that it did not require dues. Monetary support, how-
ever, was significant. Regular dues, rounded, amounted to $46,100 in
1936, while other donations increased total income to $54,500. Regular
dues in 1936 had increased more than $12,000 from 1935 levels and
reached $53,000 by 1937, with $63,000 in total donations. SSIC contri-
butions grew across all non-textile sectors of southern industry in 1935
and 1936.55 (Figure 2)
Textile firms remained the largest donors to the SSIC, followed by
petroleum and coal producers. In each industry, the line of support
followed a similar pattern. Only donations from chemical producers
remained relatively flat, likely given the industry’s high capital require-
ments, which meant that there were fewer large firms in the South
compared with textiles. After an upswing in SSIC support in the first
three to four years, donations reflected the general economic health of
member firms rather than any change in the SSIC’s reception. Even so,
growing SSIC support across the South could not counter the dramatic
SSIC Account Books, 1934–1936.

55
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1
electoral support Roosevelt and the New Deal received at southern polls.
In Alabama, 86 percent of voters cast ballots for Roosevelt in 1936.
Although the UTW and other unions never achieved the levels of south-
ern membership sought by their leaders, southerners remained among the
nation’s strongest New Deal supporters.
By 1937, southern industrialists who signed on with the SSIC sup-
ported the organization’s mission and political message and hoped that
rank-and-file southerners could be convinced that the region needed to
stand in unity against outsiders. The council’s leadership, however, rec-
ognized that the appeals to southern solidarity that they used to court
congressional support fell flat. Manufacturers’ defense of “unmitigated
economic privilege,” as one Mississippi newspaper editor put it, by appeal-
ing to social and cultural unity worked with certain southern members of
Congress, but the message lacked sufficient power to counter the SSIC’s
image as champions of the wealthy and of exploiters of southern labor.
Popular attention turned from the ills of urban industrial life to the desti-
tution of southern agricultural and mill workers, as in the documentaries
You Have Seen Their Faces by Erskine Caldwell and Margaret Bourke-
White and Let Us Now Praise Famous Men, by James Agee and Walker
Evans. With public and political scrutiny centered on the problems of
southern economic life, Dixie’s manufacturers had little capital on which
to rest their case that their mills were humane and their workers happy. It
became increasingly clear that to block reform, southern manufacturers
required a conservative defense of local government rooted in something
more than social and cultural pride. But what that “something” was still
eluded them.56
Conclusion
Debates over unionism, despite strong reactions from businesses of all
regions, failed to produce any viable political or legislative alternative.
In particular, SSIC leaders’ sectionally based defensiveness precluded any
Edgerton heralded the chemical industry as the best hope for industrial progress. He
56
explained, “the chemist is the answer to those who would feed and clothe the South
and at the same time preserve the texture of her personality, to those who would keep
her romance and at the same time give her an economic footing on a par with the rest
of the nation.” Advances in cellulose, slash pine, soy bean by-products, alcohol from
sugar cane, and tung oil would help industrial leaders develop the South’s industrial base
in a way that complemented the region’s agriculture, while at the same time preserv-
ing southern social and class hierarchies. “The South, Cinderella Land” Vicksburg Post
(Vicksburg, MS), 21 June 1937.

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Conclusion 127
hearing at a national level. Given the South’s entrenched poverty and well-
publicized history of child labor, low wages, and poor working conditions,
southern industrialists were unlikely to find an extensive national audi-
ence. They failed to make common cause with other conservative busi-
ness leaders because they sought to preserve the southern labor market
and their ties to powerful southern Democrats. Yet it was significant that
the SSIC emerged as an anti–New Deal voice. The NRA, southern indus-
trialists had charged, privileged northern and eastern industries and was
prepared to sacrifice the South’s industrial future. The evolution of federal
labor policy between 1934 and 1935 further convinced these southerners
that malicious labor organizers and political radicals held greater sway
with the Democratic president than the southern branch of the New Deal
coalition. Northern competitors used the New Deal to erase the South’s
historical competitive advantages, which had grown more threatening in
the years preceding the economic crisis. SSIC leaders criticized New Deal
policy and attempted to exempt southern manufacturers from measures
that they rejected, but their arguments lacked ideological coherence and
instead relied heavily on perceived cultural differences. Even as business
opposition to the New Deal coalesced across the nation and influenced the
rhetoric of southern manufacturers, the SSIC sought no common cause in
order to maintain its identity as a specifically southern advocate.57
By 1937, SSIC leaders insinuated that the Roosevelt administration
could no longer be counted on to respect common ties as Democrats and
honor the South’s traditions. Rather, it was apparent, in their estima-
tion, that the New Deal, the Brain Trust, and even the president himself
sought to remake the South in the North’s image, or at least to return the
region to its agricultural roots if it did not fall in line with the direction
desired by labor organizers. These increasingly strident protests indicated
that southern manufacturers were revealing their long-standing discom-
fort with reform, and they were transitioning toward new strategies to
affect policy. Two developments would serve as proof that they needed
to adapt: first, the National Emergency Council’s (NEC) Report on
Economic Conditions of the South, which publicized the South as the
“Nation’s Economic Problem No. 1”; second, the return of minimum
wage legislation in the debate over the FLSA, which shattered industri-
alists’ hopes of working within the New Deal to secure protections for
the South and their economic vision. The inability of conservatives to
Melvyn Dubofsky, The State & Labor in Modern America (Chapel Hill: University of
57
North Carolina Press, 1994), 207.

8
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1
counteract Second New Deal reforms convinced SSIC leaders that they
had to find a way to live within the regulations, modifying them where
they could. Political and rhetorical failures, not economic malpractice,
they reasoned, limited their options. The failure of economic excep-
tionalism to sway reform left this politically connected group open to
new arguments and new allies. These potentialities took time to culti-
vate and develop into a challenge strong enough to reorient politics in
Dixie. Manufacturers increasingly embraced the idea of free enterprise
and recast the South as the nation’s purest free market rather than an
economic, social, and cultural outlier.

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1
Part II
FREE ENTERPRISE AND THE SOUTH
The Southern States Industrial Council is not just another industrial orga-
nization seeking to do what other industrial organizations are doing … it
seeks the cooperation of all. The life and progress of each is dependent on
the life progress of the others. This is the message that the [SSIC] is seek-
ing to carry to the schools, the churches, the farmers, the teachers clubs,
women’s organization and all other organizations. The message is that the
material welfare and progress of all groups are dependent on the protec-
tion of the fundamental principles of business that are essential to the effi-
ciency of industrial progress … The foundation on which the [SSIC] takes
its stand and from which it makes bold to declare its patriotic mission and
great objective is the American Constitutional system of government, the
foundation of which was declared by Thomas Jefferson in the Declaration
of Independence.
–Gus Dyer, “The Nature and Purpose of the Southern States
Industrial Council,” Editorial, News Bulletin, No. 30,
January 15, 1948
129
0
3
1

1
3
Creating the Nation’s Economic “Opportunity” No. 1
After 1936, southern manufacturers’ critique of New Deal reforms

represented the political tenor amid the president’s court-packing plan and
his efforts to “liberalize” southern representation in Congress, the 1937
economic recession, the publication of the NEC’s Report on Economic
Conditions of the South, and growing conservative opposition to reform.
A diverse array of southerners defended the region from the president’s
characterization as the “Nation’s No. 1 Economic Problem” in the lead-
up to the publication of the Report, and the SSIC joined in the conver-
sation. To counteract the president’s statement, the council attempted
to maintain ties with powerful southern politicians and liberal groups,
such as the Southern Conference for Human Welfare (SCHW), which
met in Birmingham in November 1938, an interracial meeting attended
by prominent southern liberals and First Lady Eleanor Roosevelt, as well
as intellectuals, all seeking to improve the region’s human capital and
reputation.1
Although SSIC leaders viewed the SCHW and the president’s actions
toward the region with open suspicion, the council’s reorientation of its
rhetoric constituted a practical, defensive strategy. SSIC leaders’ invoca-
tion of free enterprise emerged from specific policy battles rather than
1 William Leuchtenburg, The White House Looks South: Franklin D. Roosevelt, Harry
S. Truman, Lyndon B. Johnson (Baton Rouge: Louisiana State University Press, 2005),
84–98, 104–110, 113–115. In many ways, the SSIC’s development of a new reputation for
the South responded to outsiders placing the region within a national context and charging
Dixie with degrading the nation. David L. Carlton and Peter A. Coclanis, Confronting
Southern Poverty in the Great Depression: The Report on Economic Conditions of the
South with Related Documents (Boston: Bedford Books of St. Martin’s Press, 1996), 1–9.
131
2
3
1
132 Creating Economic “Opportunity” No. 1
shifting ideology, informed by a general sense of how to promote the

South’s advantages. Yet the early, narrow applications of free enterprise
produced few victories beyond the modification of certain reforms.
Industrialists struggled to find arguments that would derail federal
minimum wage policy. The SSIC’s rhetorical alterations also took place
within a rapidly transforming political and economic climate result-
ing from the undermining of the South’s labor market and rising inter-
national competition. As a result, SSIC leaders folded economic and
cultural priorities together, while recognizing the emergence of allies
outside the South.2
Out of a constellation of reactions to policy developments and the emer-
gence of federal minimum wage policy, the SSIC grew more cohesive in
its response to the New Deal. But individual issues and regional interests
produced practical responses that complicated the emergence of a conser-
vative counterrevolution. Southern manufacturers needed an organization
to help them adjust to –not just to try to modify or block –policy. The Fair
Labor Standards Act of 1938 (FLSA) transformed southern wages to meet
national standards. While some southern mills maintained their paternalis-
tic methods of labor management, including the mill village and corporate
welfare, the FLSA undermined these systems. Navigating a new policy envi-
ronment complicated the SSIC’s rhetorical evolution toward free enterprise
and complicated the SSIC’s emerging depiction of the South as the “Nation’s
Economic Opportunity No. 1.”3
Southern industrialists still worked within the New Deal by secur-
ing amendments and exemptions to proposed legislation rather than by
launching a countermovement. Although qualified, leaders’ and members’
acceptance of minimum wages in principle represented the SSIC’s moder-
ate compromise with the FLSA. SSIC leaders pursued modifications of the
law and educated southern employers on how to adapt to it while also
launching a public relations campaign on behalf of southern industrial
development. Free enterprise resonated strongly with SSIC leaders, but
political, policy, and economic realities complicated the organization’s
2 Brinkley, The End of Reform, 229.

3 Elizabeth Fones-Wolf, Selling Free Enterprise: The Business Assault on Labor and
Liberalism, 1945–60 (Urbana- Champaign: University of Illinois Press, 1994), 7– 8.
Cannon Mills was one company that maintained its paternalism well past the FLSA, and
though management protested the FLSA as destructive, the law had little effect on profits.
Others, such as Dan River Mills, began to shift toward different management practices,
including industrial democracy. Vanderburg, Cannon Mills and Kannapolis, 100–101,
214, 215–216.

31
Failing Strategies 133
transformation. The demands of protecting established southern industry

outweighed the need for ideological consistency.4
Failing Strategies
On May 27, 1935, a day known as “Black Monday” among New Dealers,
the Supreme Court invalidated the NRA in Schechter Corp. v. United
States. The court attacked the central premise of state and federal mini-
mum wage laws, and minimum wages became a key campaign issue for
Roosevelt in 1936. Emboldened by Roosevelt’s landslide reelection, the
president and Secretary of Labor Frances Perkins continued to pursue
the promise Roosevelt had made to her at her appointment: they would
secure a floor under wages and a ceiling over hours, as well as ensure the
complete abolition of child labor in the United States. A bill Perkins had
“tucked away in her desk drawer” emerged in Congress in May 1937,
sponsored in the Senate by Alabama Senator Hugo L. Black, a longtime
advocate of the thirty-hour work week, and in the House by William
P. Connery, a representative from Massachusetts. The first version of the
Black-Connery bill called for boards to set wages in industries where rates
fell below the cost of living and proposed a 40 cent per hour minimum, a
forty-hour work week, and a minimum age of sixteen to be able to work.
The bill received several hearings and adjustments, and in July 1937
became bottled up in a House committee. Conservative opposition, par-
ticularly after the president’s move to “pack” the Supreme Court, aided
the bill’s demise. The president, Secretary Perkins, and the Department of
Labor would try again. But in the meantime, federal minimum wages and
maximum hours became central targets of business’ criticism of the New
Deal’s leftward drift and its alternative vision of the American economy.5
The administration pursued its plans to confront employers engaged
in –as the president put it –“chiseling worker’s wages or stretching
workers’ hours.” Meanwhile, although a business critique grew, south-
ern manufactures disagreed over goals and strategies to protect southern
4 Carlton and Coclanis, Confronting Southern Poverty in the Great Depression, 8– 9;
Wright, Old South, New South, 236–237, 218; Phillips-Fein, Invisible Hands, 58; Brian
Doherty, Radicals for Capitalism: A Freewheeling History of the Modern American
Libertarian Movement (New York: Public Affairs, 2007), 58; see also Daniel P. Gitterman,
“Making the New Deal Stick? The Minimum Wage and American Political History,”
Journal of The Historical Society 12, no. 1 (2012): 47–78; Ira Katznelson, Kim Geiger,
and Daniel Kryder, “Limiting Liberalism: The Southern Veto in Congress, 1933–1950,”
Political Science Quarterly 108, no. 2 (Summer 1993): 283–306.
5 Arthur M. Schlesinger, The Age of Roosevelt (Boston: Houghton-Mifflin, 1960); 277–281.
4
3
1
wages against further legislation. For conservative manufacturers, the

Black-Connery bill merited a counterassault of ideas, but these industri-
alists found few options to which to turn. “Free enterprise” did not fully
take shape until 1936 and 1937, and even then it appeared in limited
applications. To the SSIC’s leaders, free enterprise did not connote an
Eden-like market utopia to contrast with the machinery of the regulatory
state. The SSIC’s and others’ early adoption of free enterprise connoted
antistatist arguments against minimum wage proposals, but such invoca-
tions lacked coherence, particularly because manufacturers maintained
hopes of achieving some resurrection of an associationalist approach to
management of the economy to curb destructive competition.6
Opponents to the Black-Connery bill strengthened their ideological
arguments while calling for patience in advancing reforms, but this strat-
egy had limits. Southern conservatives maintained old arguments along-
side the new. SSIC leaders who testified in congressional hearings for
a regional minimum wage differential argued, along with the CTI, that
the bill’s administrative provisions were dangerous and unconstitutional.
Even as their anti–New Deal rhetoric mounted, particularly after the
president’s attempt to “pack” the Supreme Court with allies, SSIC leaders
continued to rely on arguments honed during the NRA. In particular,
southern manufacturers’ efforts to block, modify, and amend wage and
hour legislation revealed the unsettled context in which they adapted to
emerging wage policy.
Industrialists’ incoherence on wage policy resulted from persistent
internal divisions. One divide involved government action on farm prices,
a subject that had led to earlier defections among the SSIC leadership.
Some prominent manufacturers in the SSIC accepted government action
to confront the crisis in agriculture. Donald Comer, who had helped
found the SSIC, possessed wealth built on the plantation system and
invested in industry. He and his allies argued that industrial jobs offered
significant advantages over farmwork. Southern agricultural workers
remained some of the most impoverished in the nation, and manufactur-
ers argued that promoting industrial work precluded the need for further
6 Wendy Wall explains that the term “free enterprise,” used synonymously with “private
enterprise,” appeared 114 times in the New York Times in 1937, and 220 in 1940.
DuPont, General Motors, the American Liberty League, NAM, and the U.S. Chamber of
Commerce proved instrumental in advocating this more positive assertion of the nation’s
core economic principles, diversifying the terminology linked to liberalism. Wall, Inventing
the “American Way,” 49, 50–62; Franklin D. Roosevelt, Public Papers, VI, May 24, 1937
(New York: Random House, 1937), 209–214; Fones-Wolf, Selling Free Enterprise, 1–2.

5
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1
welfare spending or regulation of industry. Comer told Alabama Senator

John H. Bankhead and Representative Lister Hill that regulations should
wait until the farm wage had been raised “somewhere nearer to what the
industrial wage already is.” Congress, he argued, should “leave the more
controversial question of wages to a time when we can approach the
matter with less feeling of sectionalism and with the greater purpose of
getting at the real social rights in the matter.”7
Comer’s argument that agricultural problems superseded the plight of
southern factory workers, unsurprisingly, failed to divert reforms target-
ing industrial wages. He maintained that industrial prices should reflect
production cost and value-added by manufacture, both of which were
lower in the South than elsewhere because of the availability of cheap
commodities. By this logic, to address industrial wages and prices with-
out attention to agriculture would corrupt the price system. Most SSIC
leaders remained conspicuously silent on these suggestions, never echoing
Comer’s concerns. The business progressives in the group, such as Comer,
detested unionism but consistently supported higher prices for farm
products. Other manufacturers favored cheap commodities over all else.8
Where Comer and SSIC leaders did agree was in their vision for the
South’s industrial and agricultural future, in which the two sectors would
balance one another. These manufacturers viewed the best prospects for
industrial development as closely linked to agricultural production; fac-
tories located near productive resources could process raw materials, or
northern firms could locate plants in the South to produce agricultural
implements and farmhouse supplies. They agreed that resisting national
minimum wage and hour laws meant preserving the South’s best oppor-
tunity for future economic development while protecting existing plants.
7 Southern industrialists peppered their representatives in Washington with arguments that

the administration missed an opportunity to aid farmers, who were at a greater disadvan-
tage than manufacturing employees. Comer to Lister Hill, 13 May 1936. Breedlove cites
Donald Comer’s reluctant acceptance of government-established limits on wage and hour
legislation as the lone factor keeping him ranked as a moderate, although Comer could
be considered a New Dealer when it came to agricultural policy. Breedlove, 340, and for
agricultural reform, 233–254.
8 Comer to Hill, 13 May 1936. Although he did not denounce the organization and
remained a financial supporter, Comer avoided several attempts by various SSIC leaders
to reinstate him as an SSIC board member or executive officer. He avoided dues contribu-
tions by citing Avondale Mill’s financial troubles, but his other correspondence suggests
that he was annoyed by the SSIC’s stubborn refusal to moderate its position on agricul-
tural policy. Comer to Edgerton, 9 September 1937, Donald Comer Papers 7.131.11.
David Coker to Donald Comer, May 6, 1936, item 52 (1936–outgoing), David Coker
Papers.
6
3
1
Moreover, the SSIC tended to focus on matters of national policy rather

than on local and state-level boosterism out of necessity: they did not
want to be seen as speaking for one southern subregion over another.9
Even these minimum wage critics offered compromises. Southern
industrialists claimed to support laws that mitigated destructive compe-
tition and resisted the notion that they sought to siphon off industrial
jobs from the north by undercutting wages. At the same time, they were
suspicious of federally mandated boards enforcing such regulations and
opposed a national minimum wage that would raise southern payrolls to
national parity. Thus a limited role for government regulation of wages,
hours, and workplace practices existed within SSIC leaders’ definition
of “free enterprise.” These limits would continue to allow for low-wage
industry in the South centering on the processing of regional raw mate-
rials, with wages accounting for industrial sector, shipping costs, and
market distance. Consequently, southern industrialists’ response to the
Black-Connery proposal in 1937 was not a clarion call to arms for con-
servatives; it was an appeal for associationalism as antimonopolist sup-
port resurfaced in the administration –a proposal that had failed under
the NRA, industrialists convinced themselves, because of inattention to
regional differences and natural market conditions.10
One reason for this compromise was manufacturers’ belief that they
could limit effects of wage law by modifying its oversight. With the local
enforcement of wage policy that industrialists recommended, south-
ern employers expected to be able to transfer the “burdens of displace-
ment” of minimum wages onto less skilled workers or employees lacking
social and political capital. Manufacturers could remove restrictions
9 See James Cobb, The Selling of the South: The Southern Crusade for Industrial Development,
1936–1980, 2nd ed. (Baton Rouge: Louisiana State University Press, 1993). Comer to Terry,
1 November 1938, DC.142.16. Comer continued to view the southern economy as a largely
colonial one, writing, “The national policy regarding cotton since the Civil War has impov-
erished both our land and our people and the industrial North and East today will continue
to support laws and the regulation of laws that will keep us in the position of supplying
raw products and spending our money for the things they make.” Comer to Hugo Black,
11 December 1936, Donald Comer Papers 7.138.2. The stakes for pursuing industry varied
across the region, with underindustrialized states such as Mississippi requiring a more robust
program than in the more developed states of the Piedmont and the diversified economies of
the border states. Thus, the SSIC’s reference to balancing agriculture with industry tended to
be vague, glossing over these intraregional differences. Cobb, The Selling of the South, 15.
Brinkley, The End of Reform, 49; Claudius Murchison, U.S. Senate and House of
10
Representatives, Senate Committee on Education and Labor and House Committee on

Labor, Joint Hearings on the Wage and Hour Bill, 75th Congress, 2nd Sess., S. 2475 and
H.R. 7200 (Washington, DC: GPO, 1937), 815; Comer to Lister Hill, 13 May 1936,

7
3
1
on jobs normally reserved for blacks and increase mechanization. The

industrialists lacked, however, conceptual or practical links between their
antiregulatory, antistatist, Jeffersonian perspectives and their associa-
tionalist approach to policy, designed to preserve such racial and social
practices in wage setting. Even if industrialists agreed on a broad vision
for southern economic development rooted in balancing agriculture with
industry, the SSIC’s public statements offered no positive affirmation of
this formula. The organization’s leaders watched as the administration
pursued replacements for the NRA, calling such efforts the reincarnation
of the “NRA wolf” in “baby sheep’s clothing” because of its failure to
adequately account for regional differences, but these men failed to pro-
duce a coherent strategy or rationale to block reform.11
The SSIC identified the South’s paramount problem as its prevailing
image as a low-wage, exploitative region, which presented problems both
for the development of industry and for existing firms. The image, the
council argued, invited “meddlesome” legislation, which received support
from some of SSIC leaders’ closest contacts in Washington, DC. In pri-
vate correspondence with Donald Comer, SSIC president John Edgerton
lamented an advertisement by a southern branch of the Chamber of
Commerce using the phrase “cheap and docile labor.” Even other business
associations promoted a damaging image, he complained. Manufacturers
also wanted to preserve existing industries and homegrown sources of
capital, not to compete for labor with national corporations relocating to
areas with established plants. “Free enterprise,” by the SSIC’s definition,
would maintain local control in wage setting and enhance the growth of
southern capital, leaving outside investment to be cultivated at the state
and local levels.12
Although beginning to grasp the idea of free enterprise, SSIC leaders
developed no alternative vision of the southern economy in the midst of
southern agriculture’s continued plight and the need to confront revised
proposals of the Black-Connery bill. They realized that the arguments
they had used to promote wage differentials during the NRA, such as
the South as an infant industrial region, were no longer effective, and yet
11 John Edgerton, “NRA Wolf Being Reincarnated in Baby Sheep’s Clothing” SSIC Press
Release No. 119, 3 August 1935, Josiah Bailey Papers, 168; Gilbert Fite, Richard
B. Russell, Jr., Senator from Georgia (Chapel Hill: University of North Carolina Press,
1991), 162; Badger, North Carolina and the New Deal. For southern industrialists’
response to the FLSA and labor practices and expectations, see Wright, Old South, New
South, 224–225.
Edgerton to Comer, 9 July 1937, Donald Comer Papers 7.131.11; Wright, Old South,
12
New South, 223; Tindall, The Emergence of the New South, 534–535.
8
3
1
political realities necessitated their continuance of these positions. The

SSIC had to adapt, but cautiously, so as not to alienate its political allies.
The organization had to prove its value to its constituency while also
developing strategies that would enable the formation of a broader eco-
nomic vision and the rollback of regulations.
The SSIC and the Black-Connery Bill

The SSIC’s response to proposals that would lead to a national mini-
mum wage demonstrated the paucity of the organization’s arguments
and the limits of southern exceptionalism based on the notion of south-
ern “discrimination” by outsiders. Testifying before a joint session of the
House and Senate Labor Committees regarding the Black-Connery bill
in June 1937, Edgerton and his allies maintained their familiar depiction
of the South and its position vis-à-vis the national economy. Experience,
Edgerton explained, had taught southern industry that boards sitting in
Washington did not appreciate what the South’s conditions could accom-
modate in wages and hours. “What southern industry is mortally afraid
of,” he asserted, “is the result of domination of all industry in the United
States by a board with headquarters in Washington; be it a five-man
board or any other kind of a board. Inevitably, the majority of such a
board would represent majority interests in other sections with which the
South must compete.”13
Southern manufacturers’ testimony regarding the Black-Connery pro-
posal was manipulative and often misleading, disguising antistatism in
the garb of sectionalism and paternalism, echoing previous NRA testi-
mony. Southern branches of many industries, particularly textiles, were
indeed the targets of minimum wage policy by northern firms, who took
aim at the region’s lower labor costs because they depressed prices and
led to overproduction. Yet southern manufacturers proved equally able
to downplay self-interest amid declarations of humanitarian goals and
calls for equality. In an attempt to appear benevolent, Edgerton vowed
he would accept wage and hour legislation that was fair to all industries
(a bill he doubted could ever be crafted), and that he would support
any proposal with benefits that would accrue to all regions and work-
ers. These boards, he argued, could not appreciate labor differences
in ways that industrialists could. In particular, such boards catered to
the management-worker relations of northern and eastern businesses;
Edgerton, Joint Hearings on Wage and Hour Law, 11 June 1937, 822.

13

9
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1
The SSIC and the Black-Connery Bill 139
southern employers had a different relationship with their employees.

Edgerton argued that southern employers considered workers’ “physical
and moral” needs along with the competitive demands of industry. The
Black-Connery proposal forced employers to focus solely on workers’
needs for “sustenance,” not their cultural and spiritual lives, as, in his
view, a benevolent employer should. Edgerton’s arguments still linked
economic and social obligations, a tired and redundant tactic in 1937.14
SSIC leaders often equated the Black-Connery proposal to the defunct
NRA. They hoped to use the NRA’s unpopularity to sink the new pro-
posal for a federal minimum wage. Edgerton described the bill as an
NRA reincarnation in “more virulent form.” During Senate and House
hearings, SSIC leaders claimed that Black-Connery reprised the NRA and
northern industrialists’ efforts to destroy southern competitiveness alto-
gether. John Edgerton professed that northern industry had “lost out” to
the South and “are anxious to retard by every means possible the natural
progress and development in that part of the country which offers greater
advantages than the old, worn-out sections.”15
SSIC Vice President Fitzgerald Hall resurrected another argument from
the NRA debates. He claimed that wages paid by southern manufacturers
were 41.2 percent of the value added to a product by manufacture, com-
pared with 39.4 percent in the North and East. He reported that in 1935
northern manufacturers’ net income was 4.4 percent of total product
sales, compared to 3.4 percent for southern manufacturers. Hall argued
that southern manufacturers proved more generous to workers than their
northern counterparts were. These well-worn arguments sounded hollow,
given the well-documented paucity of southern wages and poor work-
ing conditions. Southern industrialists lacked any persuasive argument
to keep Dixie’s wages intact; consequently, they doubled down on the
sectional arguments of the previous five years.16
Such legislation, Edgerton argued, would prove unnecessary if busi-
ness were allowed to develop “naturally.” Wages were increasing more
rapidly in the South than in any other region, he continued, and this
progress should not be interrupted. In textiles, between 1933 and 1937,
the average wage had increased 47.8 percent in the South, compared
with only 34.9 percent in the North. Edgerton failed to mention that the
Ibid.
14
Ibid., 822.
15
Ibid. Fitzgerald Hall before southern senators and representatives, June 1937, SSIC
16

0
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1
southern wage had a far greater deficit to balance and that the NRA had
significantly raised southern wages via collective agreement. Nor did he
account for decreases in wages in the South following the NRA’s demise.17
Such decreases occurred more often in the region’s unskilled industries and
to a greater extent than among northern counterparts. Rather than acknowl-
edge these points, the SSIC president sought to depict supporters of wage and
hour legislation as jealous, uncompetitive, and bent on destroying their younger
industrial regional rival. Edgerton made no effort to claim that markets set
wages, though this idea circulated thanks to SSIC adviser Gus Dyer. Edgerton
continued to insist that wage legislation emanated from jealous competitors.18
In the fight against federal minimum wages, SSIC leaders faced stron-
ger pushback from liberals than they had during the NRA hearings.
Congressman Albert Thomas, a Texas Democrat elected in 1936 (who
became skilled at directing federal investment to his Houston district), ques-
tioned Edgerton on how the SSIC calculated the differences in regional costs
of living, and he doubted that the SSIC president could prove significant
differences between regions. Edgerton refused to estimate a percentage dif-
ference, instead referring to precedents set by the natural processes. Thomas
questioned, “When you mean a differential in living costs, don’t you
mean … that a man in the South because of the warm climate and cheap
land, can starve to death cheaper down there than he can starve to death
in the North; isn’t that what you mean?” Thomas characterized mill-
subsidized housing as nothing more than a “shotgun shack” for $6 per
month. Edgerton protested that his mill provided comfortable duplexes, but
the Texas congressman continued to point out Edgerton’s lack of quantita-
tive support for his argument, declaring, “When it is all said and done, you
don’t know about this alleged differential between the North and the South.
You know it exists, but you are just not able to put your finger on these
elements that make up the difference.” Edgerton replied that he had not cal-
culated the difference, and he reiterated his testimony that a differential did
exist and substantially affected what rates could be offered in the South.19
Ibid.
17
18 Ibid. In the cotton garment industry, northern producers decreased wages, but did so to
a lesser degree than southern manufacturers did. One-third of reporting northern plants
decreased wages by less than 7.5 percent, compared to only one-seventh of southern ones,
the remainder of which increased wages by between 7.5 percent and 37.5 percent, with
14 percent lowering wages by greater than 37.5 percent. U.S. Bureau of Labor Statistics,
Monthly Report, April 1937 (Washington, DC: Government Printing Office, 1937), 836.
Ibid. Transcript, Mrs. Albert (Lera) Thomas Oral History Interview I, 11 October 1969,
19
by David G. McComb, LBJ Library. Online: www.lbjlib.utexas.edu/johnson/archives

.hom/oralhistory.hom/ThomasL/Thomas-L.PDF. Vote on S. 2475, Saturday, 31 July

1
4
In the July vote on the Black-Connery bill, seventeen southern senators

voted for the bill, with nine against. The only southern states with both sen-
ators opposed were South Carolina and Virginia. Robert Reynolds, a North
Carolina Democrat, voted for the bill as a marker of his strong New Deal
support, even as powerful conservative forces in the state circled around the
state’s other senator, Josiah Bailey. SSIC General Counsel Tyre Taylor and
other influential Democrats in the state briefly attempted to convince North
Carolina’s former governor O. Max Gardner, a business progressive and
mill owner, to challenge Reynolds, particularly after Reynolds supported
Roosevelt’s court-packing plan. But Taylor and his allies backed off, not
wanting to split the Democratic Party. Opposition to the Black-Connery
proposal proved much stronger in the House, and proponents of federal
minimum wage legislation struggled for nearly a year to pass a bill.20
The first Black-Connery bill encountered stiff opposition and would
fail that summer, but dire predictions emerged from southern manufac-
turers about their industries’ fate if the law passed. History would repeat
itself, one textile manufacturer warned, if Congress granted competitors
a national minimum wage. “We certainly don’t want anything that we are
not due,” one manufacturer wrote his senator, “but you and I know that
our forefathers, by hard work and perseverance, built up this country
after the Yankees had rather thoroughly subdued us. I for one am not
anxious to see them handed the power to subdue us again.”21
Being subdued meant that manufacturers would continue to adopt
“labor saving devices” and “abandon the good old fashion southern cus-
tom of being easy and lenient on labor by hiring two men to do the work
one man does in the north.” A lumber manufacturer estimated that “forty
percent of workers would be let go,” and the remaining 60 percent would
“really have to produce.” New Dealers, these manufacturers argued,
would force southern employers to drive their workers harder and lay
off unskilled workers while introducing more advanced machinery. In
the meantime, organizations such as the SSIC, while seeking to preserve
1937, 78th Congressional Record –Senate (Washington, DC: United States Government

Printing Office, 1937), 7957.
Count of southern states includes Oklahoma, West Virginia, and Missouri, since those
20
states had representatives on the SSIC’s board. Bankhead (D-AL) and Russell (D-GA)
did not vote, nor did Caraway (D-AR) or Holt (D-WV). Julian M. Pleasants, Buncombe
Bob: The Life and Times of Robert Rice Reynolds (Chapel Hill: University of North
Carolina Press, 2003), 120–121.
John C. Shepherd Lumber Company to Bailey, 12 June 1937, Josiah Bailey Papers, 347.
21
2
4
1
southern competitive advantages, were looking for fresh arguments and

allies to block reform.22
Indeed, drafters of the bill that would become the FLSA clearly tar-
geted low southern wages, even though the final version included many
amendments and compromises, implemented gradually with an initial 25
cent-an-hour floor for wages to be increased incrementally to 40 cents
by 1941. Even with a slow rollout of wages, southern manufacturers’
wages fell under initial minimums in large numbers. Indeed, as historian
Gavin Wright explained, “few employers outside the South were affected
by these rates. Of the 690,000 workers earning less than thirty cents
an hour in the spring of 1939, fully 54 percent were southern.” Despite
the predictions of doom, industry did not disappear from the southern
landscape. Manufacturers reserved these higher-paying jobs for whites,
further displacing black workers.23
The debates over the bill revealed that southern industrialists under-
stood that minimum wages would undermine socially and racially strati-
fied southern payrolls and threaten employers’ image as paternalistic –an
image they had attempted to maintain despite the economic crisis. Work
in southern mills remained determined by race and gender. During the
Depression, amid spiraling prices and wages and as unemployment
soared, employers no longer felt the need to ensure workers’ loyalty with
corporate welfare. Still, manufacturers attempted to maintain an air of
benevolence. One North Carolina executive exhibited this tendency to
opt for cheap labor while simultaneously arguing for the right to pay
certain workers an even lower wage. “We now employ fifteen to twenty
negro laborers who are paid at the rate of 25 cents an hour” he wrote,
implying that this was a generous wage for “subnormal labor.” The exec-
utive touted the kindness he had shown his employees in times of sickness
to “look after their welfare.” Should the FLSA raise the wage to 40 cents
per hour and limit hours to forty per week, he warned, employers would
no longer be able to look after workers’ “welfare,” forcing them to hire
only the most efficient.24
Manufacturers did not hide their intention to respond to minimum
wage legislation by cutting benefits and firing “substandard” workers.
22 Thurmond Chatham, Chatham Blankets to Bailey, 17 June 1937, Josiah Bailey Papers,
348. Shepherd Company to Bailey, 12 June 1937. J. Perkins of Tobacco Hogshead
Materials to Bailey, 30 May 1938, Josiah Bailey Papers, 351.
Wright, Old South, New South, 219.
23
See Carlton, Mill and Town in South Carolina, 1880–1920; Hall, et al, Like a Family.
24
Dillon Supply Company to Bailey, 25 May 1938, Josiah Bailey Papers, 351.

3
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Although relegating black workers to the most menial, lowest-paid tasks

and firing them in exchange for white workers was not solely a southern
phenomenon, Dixie’s industrialists unabashedly declared their unwill-
ingness to pay all workers the same wage. The legislation, the North
Carolina manufacturer cited above concluded, would “necessitate the
discharge of certain of those we now keep on our payroll who are not
worth the twenty-five cents an hour.” Such statements underscored south-
ern employers’ refusal to pay African Americans wages that they deemed
appropriate only for white labor and exposed the unwinding of the mill
village under way across the South. Hypercompetition and declining
prices precipitated the end of corporate welfare and undermined the mill
village, although owners would claim federal minimum wages as the
cause. Moreover, what became apparent in the months leading up to the
FLSA’s passage was that arguments honed in resistance to the NRA were
no longer effective against national minimum wage legislation. Southern
manufacturers would have to adapt, whether they liked it or not.25
Other industry concerns filtered into manufacturers’ arguments against
the FLSA. Along with familiar arguments based on the region’s infant
industrial status, cost of living, distance from marketing and distribution
centers, and higher freight costs, seasonal fluctuations also factored into
the litany of protests southern industrialists registered against a national
minimum wage. In 1937, many argued that a federal law ignored varia-
tions in the business cycle that required seasonal additions to daily hours.
Thurmond Chatham, a North Carolina blanket manufacturer and for-
mer Woolen Wage & Hour Board member, noted that blankets sold pri-
marily in autumn months and that it was “imperative that we be allowed
to run continuously at peak seasons because if we cannot turn out the
goods our costs are increased and that cuts down consumer buying. It
seems plain to me,” he continued, “that this is plainly a wages and hours
bill and that it was never intended to put further restrictions on indus-
try.” Chatham protested that his mill already paid above-average wages
and that his 700 workers would be adversely affected by the legislation.
Another SSIC member, P. H. Hanes, son of the founder of the successful
North Carolina textile firm bearing his name, protested the bill’s limita-
tion of shifts and argued that such measures would “undoubtedly” result
in increased unemployment “under the present depressed conditions.”26
25 Ibid. Gunnar Myrdal, An American Dilemma: The Negro Problem and American
Democracy (New York: Harper Brothers, 1944).
Chatham responded directly to a proposal from Congressman Alfred L. Bulwinkle
26
(NC-D), who represented the heavily textile Tenth (redistricted to Eleventh) District that
41
Yet SSIC leaders approved of the goals of minimum wage legislation.

Legislation should curb disgraceful abuses of labor, they argued. Donald
Comer expressed this preference to Edgerton, writing, “My idea all along
has been that this legislation should seek only to prevent flagrant exploita-
tion as regards wages but be more specific in its correction of the abuses
in the case of hours and ages.” Even those who were not former progres-
sives expressed similar desire for legislation to allow for the curbing of
destructive competition. A North Carolina textile manufacturer surveyed
opinions among manufacturers in his state and concluded that, although
many industrialists opposed regulation, many felt that laws were needed
to “bring about greater uniformity in textile wages and protect those
employers, now paying reasonable wages and operating reasonable hours
and who desire to do so, from the unfair competition of those mills which
pay niggardly wages and run long hours.” Some mills, the manufacturer
argued, cut wages and lengthened hours after the NRA’s demise. These
“weak mills” threatened the overall health of the region’s industry by
promoting cutthroat competition.27
Textiles had long been a “sick” industry, and endemic competitive
practices proved difficult to eradicate. Some manufacturers did continue
to pay wages at NRA-mandated levels after the program had ended, but
many employers cut rates. The specter of competition loomed, partic-
ularly with an influx in 1936 of cheap cotton textiles from Japan. But
southern manufacturers were intransigent against federal regulation of
wages. They opposed wage uniformity most of all. Opponents to federal
wage legislation lacked any coherent alternative, other than association-
alist approaches, to solve hypercompetition and pernicious industrial
practices.
Pursuing a Countermovement
Conservatives saw reason to hope in December 1937, when Senator
Josiah Bailey of North Carolina led six senators in protest against the
New Deal with their “Declaration of Principles.” Rather than “experi-
menting” further, Bailey and his associates, Senators Harry Byrd, Edward
included Gastonia. Bulwinkle proposed an amendment to the wages and hours bill that
would prohibit work in textile mills between midnight and 6 AM. Chatham used the
example to illustrate the inherent unfairness of the proposed bill. Chatham to Bailey, 17
December 1937; P. H. Hanes to Bailey, 17 December 1937, Josiah Bailey Papers, 349.
Comer to Edgerton, 9 September 1937, Donald Comer Papers 7.131.11. Wright, Old
27
South, New South, 217.

5
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1
Pursuing a Countermovement 145
Burke of Nebraska, Royal Copeland of New York, Joseph Tydings of

Maryland, and the lone Republican, Arthur Vandenberg of Minnesota,
declared on the Senate floor: “Without criticism of policies attendant
upon the former emergency, we recognize that a repetition of those poli-
cies would not serve again and moreover is out of the question. It ought
to be borne in mind that private enterprise, properly fostered, carries the
indispensable element of vigor.” Responding to FDR’s call for an invest-
ment of private capital, the conservative senators proposed a recovery
plan for American business. This plan included a revision of capital gains
and undistributed profits taxes, the reliance on the capitalist system, a
return to self-dependence, as well as the preservation of and reliance on
private enterprise and initiative. Such arguments resonated with man-
ufacturers who feared the establishment of a permanent bureaucratic
state.28
The “Declaration” reinvigorated the political activism of business
interests. The protest of conservative southern politicians indicated that
there were senators –and powerful ones –amenable to the principles
that the SSIC touted: limited regulation, lower taxes, balanced budgets,
limits to social welfare, and the promotion of private capital in the South.
Potential New Deal challengers existed among southern Democrats, but
manufacturers needed better arguments to appeal to senators and repre-
sentatives who wanted to protect their seats. Bailey, the organizing force
behind the manifesto, felt emboldened only because he would not face
reelection until 1942. He had won reelection in 1936 on his record of
support for the New Deal. Just days after his reelection, however, he com-
municated to other conservatives that he would pursue anti–New Deal
positions. SSIC leaders concluded that their cultivation of Bailey as an
ally had been rewarded.
Southern manufacturers rallied to support the Declaration. SSIC
cofounder and cotton textile manufacturer William Anderson congrat-
ulated Bailey, stating, “For some time I have been carrying on a vigor-
ous campaign to stir up the business men of this country and have them
furnish to Members of the Congress the facts concerning business in the
28 See Fite, Richard B. Russell, Jr.; James T. Patterson, Congressional Conservatism and
the New Deal: The Growth of the Conservative Coalition in Congress, 1933–1939
(Lexington: University of Kentucky Press, 1967); Bailey, “Declaration of Principles,”
20 December 1937, Josiah Bailey Papers, 475. See also, Turner Catledge, “10 Points
Drafted,” New York Times, 16 December 1937. The SSIC protested the undistributed
profits tax even though it had been significantly watered down during deliberations.
David M. Kennedy, Freedom from Fear: The American People in Depression and War,
1929–1945 (New York: Oxford University Press, 1999), 280.
6
4
1
various sections of the country and the various types of business endeavor,
and to offer such suggestions as to them seemed pertinent and wise.”
Anderson assumed that southern members finally accepted manufactur-
ers’ recommendations. Another SSIC member appeared rapturous over
the “Declaration,” calling it the “first real ray of hope.” He applauded
Bailey on his and the other signatories’ “backbone.” An Atlantic Coast
Line Railroad official, a generous SSIC donor, called the Declaration a
“masterpiece” and declared that “all ‘enterprise’ wants is a chance. … If
the Government expects business to improve, it should stay out of busi-
ness, because it is impossible for any legitimate business to even expect to
compete with the Government. The business of Government is to govern,
and if it does that properly it will have its hands full [original empha-
sis].” Letters praising the “Declaration” poured in to signers’ offices from
business.29
Still, the New Deal’s strength in the South meant that consistent polit-
ical allies proved difficult for the SSIC to find. Representatives who drew
electoral support from agricultural areas needed a good reason to risk
alienating voters. Senator Allen Ellender of Louisiana was a prime exam-
ple of a reluctant ally. Sometimes a Huey Long–type populist, sometimes
a New Dealer, always a defender of segregation, he was “lukewarm, at
best” on the FLSA. But he was suspicious of business interests, particu-
larly Wall Street bankers whom he saw as having extorted farmers with
high interest rates. Ellender “preferred the old way of setting rates, by
the law of supply and demand.” But in 1937 and 1938, SSIC leaders did
not use this argument against the FLSA. They continued to tout south-
ern economic exceptionalism and celebrated their paternalism, a position
Ellender’s constituents despised.30
Other southern politicians proved equally difficult to win over. SSIC
Secretary C. C. Gilbert indicated that the stand taken collectively by the
southern governors in support of wage and hour legislation caused him
“deep disappointment and apprehension.” Gilbert wrote to Senator Bailey
to beg him to oppose the proposed legislation, warning that its passage
“will definitely make the South the stepchild of the nation,” and would
threaten the “free and complete development” of the region’s “natural
29 Anderson to Bailey, 8 January 1938; W. H. Morrison, Davis Cabinet Company to

Bailey, 4 January 1938; William Peck, Atlantic Coast Line Railroad to Bailey, 20
January 1938, Josiah Bailey Papers, 170; Ronald L. Heinemann, Harry Byrd of Virginia
(Charlottesville: University Press of Virginia), 79–81.
Thomas Becnel, Senator Allen Ellender of Louisiana: A Biography (Baton Rouge:
30
Louisiana State University Press, 1995), 77–78.

7
4
1
and economic” advantages. The governors pushed strongly for a revision

of freight rate differentials by the Interstate Commerce Commission, and
Gilbert feared that they would trade support for the FLSA with action
on the freight matter. Bailey consoled Gilbert, assessing the governors’
statement as of little consequence and disavowing knowledge of any such
trade. Southern solidarity, the SSIC hoped, would commit southern repre-
sentatives such as Bailey to their cause and vision for southern industrial
protection and further development.31
The 1937 recession gave the president’s critics an opportunity both to
proclaim that the New Deal was bad for the country and to create a coa-
lition to block further reforms. The GOP’s weakening western progres-
sive “impulse” brought Senators such as Idaho’s William Borah into the
developing coalition. The coalition successfully stymied several of FDR’s
domestic initiatives in 1937, and southern senators blocked antilynch-
ing legislation. The FLSA was a rare exception, although conservatives
amended it significantly.32
The SSIC built its reputation as an ardent defender of southern values,
southern economics, and southern industry. Its leaders remained hopeful
that they could recapture the Democratic Party for the South; in fact,
many were convinced that southerners would never vote any other party
into office. Rather than pursuing coalitions with rural-based leaders and
business groups from outside the South, SSIC leaders continued to defend
what they considered peculiarly southern economic considerations. At
least for the time being, this calculation moderated the organization’s
economic conservatism, if not its social and cultural traditionalism.
Southern manufacturers could not lessen their efforts to appear as benev-
olent, paternalistic employers out of political necessity.
Allies expected such attitudes to continue. Senator Bailey addressed the
annual SSIC dinner for southern congressmen in May 1938, as he had in
years past. At this dinner, Bailey exhibited a familiar paternalism. Bailey
extolled the South’s virtues, as he understood them, referring to wisteria,
the great river, and southerners “who live beautifully; the little children,
its negroes, its mules, its dogs. (Laughter.)” Bailey exuded the kind of defi-
ant confidence in the South’s white elites around which the SSIC hoped to
rally southerners of similar mind. The SSIC and Bailey relied on a sense
“Southern Governors Back FDR Wage-

31
Hour Measure” Florence Morning News
(Florence, SC) 8 January 1938; Gilbert to Bailey, 17 January 1938, Josiah Bailey Papers,
170; Bailey to Gilbert, 3 February 1938, Josiah Bailey Papers, 171.
Clyde Weed, The Nemesis of Reform: The Republican Party During the New Deal
32
(New York: Columbia University Press, 1994), 185–190, 178, 193.

8
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1
of common ancestry and place, and appealed to elites’ sense that their
social as well as economic power had to be preserved. Bailey praised
the region’s Americanism, its devotion to the Constitution, and even its
“depravity,” joking, “they can’t reform us and they can’t reconstruct us.
(Laughter).” Paternalism continued to appear in SSIC leaders’ and their
supporters’ statements, which complicated cross-regional alliances. But
a shift toward a more critical, activist stance on the New Deal among
southern manufacturers had taken hold. Opposition, however, required
allies –allies who were not southerners and who would not appreciate
allusions to Reconstruction.33
Leadership changes began to reshape the SSIC and its approach to politi-
cians. Fitzgerald Hall assumed the presidency after John Edgerton’s resigna-
tion in the early months of 1938. Though Edgerton resigned purportedly to
attend to Lebanon Woolen Mill, it is likely his poor health led to his reduced
public activity. He suffered a fatal heart attack on August 4, 1938, at the
age of fifty-eight, only a few months after giving up the SSIC presidency as
well as his position leading the Tennessee Manufacturers Association. Hall,
an executive for the Nashville, Chattanooga & St. Louis Railroad, did not
have Edgerton’s national reputation, who had served as a NAM president.
Yet Hall’s connections with southern industry and his Nashville ties made
him the clear choice to succeed Edgerton.
Hall knew that the council and its allies in Congress were in the minority,
but he held out hope that they could use their allies in Washington to build
a countermovement. He told Senator Bailey, “Perhaps as never before we
in the South in particular are dependent on a relatively few great men to
pull us through the present crisis.” He continued, “But I am sanguine to
believe that you, Sen. George, Sen. Byrd, and a few others, can stem the
tide until people come to their senses.” Common sense would prevail,
Hall argued, and the country would soon realize the illogic of the New
Deal. In 1938, these conservative southerners anticipated a political reor-
ganization that would turn the tides in their favor. Byrd, Bailey, Hall, and
SSIC leaders called for a new “Solid South,” one that would stand against
outsiders’ efforts to remake the region.34
33 Josiah Bailey, “Address to Annual Dinner of the Southern States Industrial Council and
Southern Representatives in Congress,” 25 May 1938, SSIC pamphlet, SSIC Papers Box
1, Folder 4.
Fitzgerald Hall to Bailey, 8 November 1938, Josiah Bailey Papers, 11; Bailey to Harry
34
Byrd, 22 November 1938, Josiah Bailey Papers, 476. John Edgerton’s granddaughter
asked this author to investigate whether union organizers had been involved in her
grandfather’s death, a rumor that circulated for many years. No evidence suggests
Edgerton’s demise stemmed from anything other than natural causes, but the rumor

9
4
1
But conservative industrialists, angry at federal wage policy, faced

continued political problems even with the growth of a conservative coa-
lition. Dixie, for all the SSIC’s assertions that it was a bastion of tradition
and conservatism, boasted a fair number of liberals and New Dealers.
Alabama, sometimes called the most liberal state of the Deep South, was
represented by Hugo Black, the Senate’s champion of wage and hour
legislation. In August 1937, FDR rewarded Black with an appointment
to the Supreme Court. Alabama’s governor appointed his wife, Dixie
Bibb Graves, to fill Black’s vacant seat. After several months of vigorous
support of the New Deal, Senator Graves resigned in January, making
way for the appointment of another Roosevelt supporter, Representative
J. Lister Hill, a fifteen-year veteran of the House.
In the April election, Hill defeated a candidate backed by conservative
rural and industrial interests and went on to serve in the Senate for the
next thirty-one years. A stalwart New Dealer, Hill helped push through
the FLSA, which gained momentum after Florida Senator Claude Pepper
defeated an anti–New Deal challenger in the Florida primary in May
1938. Southern liberals in Congress, such as Hill and Pepper, helped pro-
mote the idea that southern wages had to rise. With such strong New
Deal support in Congress emanating from the South, the SSIC had to find
a strategy to challenge wage legislation that did not smack of reactionary,
backward-looking opposition, playing into the worst characterizations of
southern industrialists.35
Unlike liberal adversaries, the SSIC lacked an underlying set of ideas
to shape the political economy. The SSIC’s lone academic adviser, Gus
Dyer, did not move in prominent intellectual circles. As the writings of
British economist John Maynard Keynes became more influential in
the late 1930s, conservatives struggled to produce a similarly coherent
points to the hatred and high emotions that existed between him and union officials.
Harriet Lancaster, interview by author, Lebanon, TN, 12 March 2006; “Terry Takes
Over New Duties Today,” Kingsport Times, 1 February 1938; “State Industrial Leader
Succumbs,” Kingsport Times, 5 August 1938. The term “Solid South” has long been
“of questionable value to the historian,” but in the late 1930s it seemed to be a reality
that prevented the region’s manufacturers from achieving their policy goals. Woodward,
Origins of the New South, 75.
Schulman, From Cotton Belt to Sunbelt, 72. Hugo Black pushed for Edgerton to name a
35
rate, to which he responded, “$11 or $12.” Edgerton also declared that he would prefer
to see the creation of a new agency to oversee these minimums rather than turn oversight
over to the Department of Labor or the NLRB. John Edgerton, testimony before Joint
Hearings Before the Committee on Education and Labor, United States Senate and the
Committee on Labor, House of Representatives on Wage and Hour Law, S. 2475 and
H.R. 7200, 75th Cong, First Sess., 11 June 1937, 804.
0
5
1
set of ideas that reflected their wide range of concerns. Austrian and
London-based free market economists remained more reactionary than
practical in their responses. Laissez-faire and associative practices had
each fallen out of favor, and southern business conservatives needed a
forward- looking alternative. While southern traditionalists critiqued
industrial capitalism and Enlightenment humanism, southern business
conservatives sought a middle ground. They strategized once to adapt to
modern capitalism, solidify their bourgeois values, and preserve a sense
of the “southern way of life.” At the same time, they had to adapt to polit-
ical realities in the South.36
Congressional votes on the FLSA reflected urban- rural divisions.
Representatives whose seats depended on a strong working-class vote
tended to support the bill; opposition to the FLSA tended to emerge from
areas where white legislators benefited from the suppression of black
voters, or from districts where representatives felt secure in their seats.
In North Carolina, for example, four “yea” votes came from represen-
tatives of the industrialized areas of Asheville, Raleigh, High Point, and
Greensboro. They faced close races for reelection or were New Dealers
with strong connections with the administration. Three “nay” votes from
the North Carolina delegation came from members who would run unop-
posed for reelection in November; a fourth voted against the bill but was
reelected by a three-to-one margin. The fifth “nay” came from J. Walter
Lambeth of the eighth congressional district, who had worked in the
furniture-manufacturing industry and drew support from Thomasville.
The FLSA vote revealed that southern representatives anticipated turn-
out of low-wage voters, and they voted against the bill only when they
felt safe from a worker-based challenge at the polls. Without an overtly
pro-business coalition in the Congress, the SSIC had to moderate its mis-
sion. The council had to offer services to its members to adapt to the
legislation. Unable to kill the bill, it pursued regional wage differentials
and attempted to limit enforcement of the act through administrative
methods. After more than a year of debate, Congress passed the FLSA,
also known as the Wages and Hours Bill. On June 25, 1938, FDR signed
Brinkley, The End of Reform, 66. Conservative business leaders were not the norm,
36
though they would be instrumental in funding a conservative intellectual counterinsur-

gency. Robert Collins argued that business leaders adopted a modified acceptance of
some Keynesian principles, which would facilitate business- government- labor coop-
eration following World War II. Phillips-Fein, Invisible Hands; Collins, The Business
Response to Keynes, 1929–1964; Angus Burgin, The Great Persuasion: Reinventing Free
Markets since the Depression (Cambridge, MA: Harvard University Press, 2012).

1
5
it into law. Democrats voted fifty-five to eighteen in favor of the bill in the
Senate, but only 44 percent of southern Democrats cast a “yea” vote.37
Business leaders and conservatives flocked to the SSIC as the proposal
became law. In strongly pro-FLSA states such as Oklahoma and Louisiana,
where the manufacturing base remained small, manufacturers turned to
the SSIC for representation. Donations to the SSIC increased during 1937,
stemming from both reactions against the Wagner Act and the ensuing
wave of strikes that resulted, as well as the SSIC’s strong advocacy for a
regional wage differential. In Oklahoma, donations quadrupled from 1936
to 1937, and in Louisiana, 1936 donations of around $3,000 increased to
$4,000 in 1937. In Alabama, where five representatives voted “yea,” with
only one “nay” and three abstentions, donations between 1936 and 1937
increased 20 percent, reflecting manufacturers’ increasing turn toward the
organization that offered the best articulation of their policy positions.38
Although manufacturers would have to adapt to federal regulation
of wages and hours, SSIC leaders hoped to use their failure to defeat the
FLSA to craft a conservative political countermovement along ideological
lines. Their best hope for a conservative alternative to the New Deal came
from the senators who had proffered the “Declaration of Principles.”
Southern manufacturers began to develop conservative and business-
oriented positioning that would encourage such a countermovement,
although the details of any plan they had for recovery remained murky.39
Meanwhile, the conservative coalition in Congress bolstered SSIC
leaders’ hopes for FLSA modifications and the blocking of further
reforms. Stronger business critiques of macroeconomic management and
a reconsideration of business- government relations by several parties
helped reestablish the Republican Party as a competitive entity follow-
ing the 1938 midterm elections. Roosevelt’s attempts to challenge con-
servative southern congressmen in the midterm elections backfired. In
37 Robert K. Fleck, “Democratic Opposition to the Fair Labor Standards Act of 1938,” The
Journal of Economic History, 62, no. 1 (2002): 25–54; Andrew Seltzer, “The Political
Economy of the Fair Labor Standards Act of 1938,” The Journal of Political Economy,
103, no. 6 (1995): 1302.
SSIC Account Books, 1933–1945.
38
Weed, The Nemesis of Reform, 762–763. Seltzer explains, “Because far more testimony
39
[concerned the ‘unworkable, un-American, impractical, and dangerous’ aspects of the

bill rather] than the direct effects of the act, it is difficult to dismiss as solely being a cyni-
cal attempt to mislead colleagues or constituents. Rather, it is likely that these statements,
at least in part, reflect sincerely held ideological believes about an ideal state of the world
and the role of the FLSA in such a world.” Seltzer, “The Political Economy of the Fair
Labor Standards Act of 1938,” 1304, 1307, 1321–1322.
2
5
1
the November election, only one FDR-backed southern challenger of an

anti-FDR incumbent won. Democrats lost six Senate seats and seventy-two
House seats, mostly among New Deal Democrats. Southern Democrats
held their positions of power on committees such as the House Ways
and Means and Appropriations in the Senate, having benefited from a
reduced electorate, white primaries, and one-party rule in the region and
thus maintaining electoral longevity and therefore institutional seniority.
Conservative resurgence in Congress encouraged SSIC leaders to con-
tinue their efforts to promote their agenda among southern representa-
tives in Washington, even as they had to adapt to wage legislation.40
Modifying the FLSA
While SSIC leaders had attempted to modify NRA regulations by simply
increasing southern representation on code boards, the FLSA provided
no similar avenue for manufacturers to preserve Dixie’s low wages and
socially stratified labor market. Conservatives had weakened the bill sig-
nificantly, limiting its application to roughly one-fifth of workers, and
securing exemptions for certain occupations, as well as wage adjustments
for cost of living and higher freight rates in the South. To appeal to south-
ern opponents, FDR had stated that there could not possibly be “unifor-
mity” in wages across the United States, this in his address to Congress
in January 1938, in which he reintroduced the wage and hour bill. But
the FLSA, despite being amended and weakened, began to reshape the
South’s wages.
As federal wage policy chipped away at the South’s separate labor
market, SSIC leaders had to carefully position the organization to be
effective in the long term. While the opposition’s rhetoric became more
ideological, the SSIC’s methods appeared more practical and cooperative.
Instead of focusing on the unjust treatment of the South, of which they
remained convinced, SSIC leaders embraced the language of free enter-
prise to characterize southern industrial relations and pushed to clarify
and adjust the law to limit application to southern workers.41
The SSIC’s Executive Vice President, Louisville-based former NRA
board member Prentiss Terry, embodied the SSIC’s efforts to help its
Southern Democrats were a thorn in the side of the Roosevelt administration. Katznelson,
40
Fear Itself.
Franklin D. Roosevelt, “Annual Message to Congress,” January 3, 1938, online by
41
Gerhard Peters and John T. Wooley, The American Presidency Project. www.presidency
.ucsb.edu/ws/?pid=15517; Gitterman, “Making the New Deal Stick?” 76.

3
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1
Modifying the FLSA 153
constituents adapt to the legislation and to move the council in line with
other advocates for southern development, downplaying the image of
intransigent business leaders. Terry, a longtime government employee
and Rotarian, maintained an extensive network of southern intellectu-
als, business leaders, and government administrators, including Elmer
Andrews, the wage and hour administrator. In November 1938, Terry rep-
resented the SSIC at the inaugural meeting of the SCHW in Birmingham,
which was formed to address issues raised by the Report on Economic
Conditions of the South. His leadership reflected new directions in SSIC
activities and political lobbying.42
To inspire SCHW members, and to declare industrialists’ commitment
to the South, Terry heralded a new day for the region. He extolled the
virtues of the “romantic old South” as a “glorious epoch in American
history” but declared that a new South had arrived. Acknowledging that
the South’s jealous competitors had biased the Roosevelt administration,
Terry charged that such accusations “helped more than harmed.” He rea-
soned that national attention made the South take stock and offered a
publicity opportunity. In fact, he declared, “We could not have planned
or paid for such an effective advertising campaign.” Terry reaffirmed
to the gathered group of mostly liberal southerners that the South was
the “Nation’s Number One Economic Hope.” He and SSIC spokesmen
attempted to build a more public relations–oriented organization that
could pursue economic and industrial development for the region in con-
cert with the SCHW, the SGA, state Chambers of Commerce, and civic
groups.43
Terry’s address revealed how southern manufacturers were abandon-
ing paternalism as both a labor management tool and an explanation of
southern industry’s differences from national norms. For management,
Terry laid out a set of obligations to achieve just and beneficial industrial
relations. Management had to “ ‘get along’ with its own folks by giving
consideration to their welfare and their interests as a day to day part of
42 John Egerton, Speak Now Against the Day: The Generation Before the Civil Rights
Movement in the South (Chapel Hill: University of North Carolina Press, 1995),
167–184.
Prentiss Terry, “Industrial Relations and the American System of Free Enterprise.” 24
43
October 1938. Speech given before the National Association of Commercial Organization
Secretaries, New Orleans; also delivered at the SCHW, Birmingham, AL, Donald Comer
Papers 7.142.16. Howard Odum told Terry that the SCHW, along with “twenty other
groups,” would undermine his Council on Southern Regional Development, and that the
SCHW would lead to some nice pronouncements but achieve little. Odum to Terry, 15
August 1938, in Tindall, “The Significance of Howard Odum to Southern History,” 300.
4
5
1
doing business, and not waiting until a crisis arises.” He affirmed that the
majority of employers pursued fair and just treatment of their employees,
but a small minority ruined the reputation of all. Terry extolled employ-
ers’ virtues, depicting a group that was more than capable of achieving
the vision he laid out. “Most employers,” he argued, “do not want to
practice paternalism, but fraternalism, to seek the job security of their
employees by collective effort –the well-being of one through the well-
being of all.” He rejected the idea of jobs as a “social obligation” as well
as the theory that workers should be able to command a certain percent-
age of a company’s profits. Terry wavered between believing employers
had social obligations to their workers –he sought to paint employers
in a benevolent light but not in old-fashioned paternalism –and the eco-
nomic laws that he argued governed the setting of wages.44
Combining these impulses, Terry implied that economic leaders were
the best guardians of free enterprise. He rejected the idea that job creation
stemmed from “social considerations,” emphasizing production needs
instead. By filtering out socially motivated reasons for building indus-
try –a prominent feature of past “New South” boosterism –he plot-
ted a new course. Market forces, he promised, would undermine union
organizers, rather than attacks on labor leaders as outsiders, foreigners,
or non-southerners. Experience, Terry argued, would demonstrate the
theoretical fallacy that labor organizations should “have the economic
power to command anything they want regardless of the rights of oth-
ers.” Profits must be earned by greater productivity, he explained, and
could not be dictated by the demands of organized labor. In the end, the
utopian dreams of these manipulative organizers, he exclaimed, would
meet their inevitable fate and be “an illustration of a beautiful theory
destroyed by a nasty little fact.” Pragmatism and the laws of supply and
demand, he argued, would win out over social obligation and sentiment.
In 1938, such language and ideas of free enterprise began to replace old
appeals to social cohesion and paternalism in SSIC rhetoric.45
Terry offered a rosy forecast if government let free enterprise work. If
management and workers recognized the rights of the other and acted in
democratic spirit –meaning that each side received an equal voice without
the interference of a government arbiter –employers and “their cowork-
ers” could solve any problem that might arise. Tensions, Terry explained,
did not stem from employers or employees, but from government. The
Terry, “Industrial Relations.”

44
Ibid.
45

51
FLSA’s “one-sided” nature, he charged, citing the “doubts surrounding its

administration,” resulted in increased discord in industry. He suggested
that Congress reexamine the FLSA and introduce “corrective legislation
which will bind the Act and its administration so as to protect the rights
of employees, employers, and the public alike.” Terry and the SSIC did
not call for overturning the FLSA but sought to introduce limitations and
“protections” to keep the voice of employers in line with that of labor;
namely, they argued for the elimination of governmental interference in
the setting of hours and wages, and the negotiation of contracts between
management and employees.46
To this end, SSIC representatives worked to limit the wage and hour
law. In January 1939, the SSIC’s new president, Edward J. McMillan,
president of Knoxville’s Standard Knitting Mills, lobbied for an amend-
ment excluding clerical workers from the provisions of the act. Elmer
Andrews, the first administrator of the wage and hour division, heard the
petition and agreed to consider the amendment, which exempted cleri-
cal employees and office workers paid by salary. These employees, who
received paid vacations and sick days, would not be eligible for wage
and hour oversight. The amendment’s supporters contended that office
employees did not produce or participate in the distribution of products
for sale in interstate commerce and therefore were not subject to the
law. The division adopted the exemption, and SSIC leaders heralded their
organization’s role in influencing the decision. But other concerns still
confronted members.47
The question of southern discrimination in wage and hour setting had
not disappeared, and the SSIC remained vigilant in pursuing a wage dif-
ferential. Under the FLSA, the SSIC leaders aimed to represent the needs
of small and medium-sized industries located outside of the core indus-
trial centers of the North and East rather than to pursue the wage dif-
ferential on a strict North-South binary. As an example of willingness to
reach out beyond the South, SSIC leaders supported the northwestern
lumberers who objected to FLSA hour limitations, based on the seasonal
nature of their industry. Given textile industry’s continued dominance
of the council, SSIC leaders lobbied in the interests of low value-added
Ibid.
46
Gilbert to SSIC constituency, 29 January 1939, SSIC Papers Box 3, Folder 1; Report
47
issued by Administrator Philip B. Fleming, together with some comments by Mr. J. H.
Ballew and C. C. Gilbert, 26 October 1940, SSIC Papers Box 3, Folder 1; Margery
Bensey, Park City: A Knoxville Neighborhood History (Charleston, SC: The History
Press, 2012), 28.
6
5
1
industries that primarily processed raw materials, which they argued

would be most adversely affected by provisions of the FLSA.48
The Wages and Hours Administration in the Department of Labor set
up specific industry committees to oversee the establishment of wages.
Each committee would administer the increase of wages in its designated
industry from the initial 25 cent minimum to the 40 cent rate. When
Industry Committee No. 1 proposed to increase textile wages to 32.5
cent per hour in July 1939, SSIC officials protested that such a minimum
would adversely affect the South. Even though the rate was less than the
40 cent minimum permitted by the law and only 2.5 cents higher than the
30 cent rate proposed by southern textile representatives in the commit-
tee, few industry leaders endorsed the modified wage, preferring to resist
outright or remain silent.
SSIC General Counsel Tyre Taylor testified before the Wages and
Hours Administration as general counsel for both the SSIC and the
ACMA. Taylor pointed to the lack of representation of “cotton growing
states” on the committee, since twelve of the twenty-one members were
from states where cotton was not the staple crop. C. C. Sheppard, SSIC
vice president and president of the Louisiana Central Lumber Company,
appeared on behalf of the SSIC. He argued that if the wage increased,
small mills would be unable to compete. Margaret Mager, the SSIC’s
research director, followed up Sheppard’s testimony with her conclusion
that 319 southern towns in which small mills were located would be
adversely affected.49
Opponents still noted the sectional and emotional nature of the SSIC’s
activism to resist regulation. Liberals, including Frank Porter Graham,
president of the University of North Carolina at Chapel Hill, testifying
on the committee recommendation, acknowledged the need for slow and
steady action in the textile industry so as not to disrupt a sector plagued
by “overcapacity and instability.” Graham characterized opposition as
articulated “bitterly rather than wisely but always as certain to destroy
or cripple industry in general or some industry in particular.” Supporters
of the federal minimum wage emerged from industry circles as well, par-
ticularly those that might suffer from wage competition. North Carolina
48 P. O. Davis to Comer and Southern Governors’ Conference, 20 May 1939, Donald
“Textile Wage Rise Opposed by Council,” New York Times, 6 July 1939; “Roosevelt
49
Expresses Belief in Dixie Need of Wage Differential,” Jackson Clarion-Ledger (Jackson,

MS), 2 August 1939; “The Wage-Hour Discussions,” Anniston Star (Anniston, AL), 9
July 1939, Josiah Bailey Papers, 353.

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1
textile manufacturer Hyman Battle of Rocky Mount Mills supported

the committee’s recommended wage. He argued, “It is my belief that the
opposition to this minimum wage is merely a subterfuge that the oppo-
nents are trying to create enough sectional feeling to assist them in repeal-
ing the law.” The SSIC’s appearance of moderation, it seemed, did not
fool opponents. Pursuing modifications still constituted an attack on the
principle of federally mandated minimum wages.50
When the SSIC’s petition for the clerical worker exclusion succeeded
in October 1940, council leaders rejoiced and publicized their success to
constituents. In the SSIC’s fourth official brief submitted to the Wages
and Hours Administration, drafters stated that they did not intend to
limit regulations on employees whom Congress had wished to protect
under the law. Yet SSIC representatives argued that the law left adminis-
trators with too much power. Administrators were attempting to act as
“umpire between industry and labor,” a role beyond their authority. Any
action by the wages and hours administrator that went beyond determin-
ing abuses of the law, SSIC leaders asserted, such as the setting of new
wages, infringed upon the powers of Congress.51
The SSIC could only modify and critique the law, given the lack of
a cross-regional conservative alternative. Every attempt to undermine
and repeal the law failed. Despite these limitations, the SSIC’s approach
complemented conservative developments in the late 1930s. Southern
conservatives focused on harnessing state governments for economic
development. At the national level, they pushed to modify federal reg-
ulations, supporting the tactics of conservatives in Congress. The FLSA
proved disappointing and even galling for southern manufacturers, but
their representative organization found purchase in the altered political
and economic landscape. Their emphasis on market conditions and free
enterprise provided a strong base from which to move forward, even
50 Testimony of Frank Porter Graham, U.S. Labor Department Wages and Hours Division,
19 June 1939, Folder 953, Scan 20, Frank Porter Graham Papers, Southern Historical
Collection, University of North Carolina–Chapel Hill, Chapel Hill, NC (hereafter cited
as Frank Porter Graham Papers); Hyman L. Battle to Frank P. Graham, 20 June 1939,
Folder 952, Scan 6, Frank Porter Graham Papers.
“Supplemental Brief of SSIC on Petition for the Issuance of Regulations Defining
51
Executive, Administrative and Professional Employees,” 10 August 1940, SSIC Papers

Box 3, Folder 3. Donald Comer, representing the ACMA, objected to the minimum wage
by citing greater competition from new materials such as jute. He protested the bureau-
cratic rulings of the law and argued that Congress should set wages and hours. Donald
Comer, Statement, U.S. Labor Department Wages and Hours Division, sent to Frank
P. Graham, Folder 952, Scan 35–46, Frank Porter Graham Papers.
8
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though rhetoric alone could not secure the full slate of FLSA modifications
that SSIC leaders sought.
Free Enterprise and the Nation’s No. 1

Economic Opportunity
The NEC’s Report on Economic Conditions of the South, released in
the summer of 1938, sent shock waves across the region. Prepared at
the request of President Roosevelt, the Report represented the collected
observations and opinions of southern liberals concerned with regional
poverty. It criticized the South’s dependence on outside capital invest-
ment as degrading the nation’s prosperity and called upon the federal
government to intervene. In order to increase regional purchasing power,
drafters recommended redistributing national wealth to the South as
relief dollars, combined with narrowing the North-South wage differ-
ential. Other than agreeing that the region required greater homegrown
sources of capital, southern manufacturers resented the NEC’s findings
and pursued a public relations campaign to rebrand the South’s economic
reputation, particularly to defend existing industries and wage structures
as politics shifted in new directions following the 1936 election. While
members of Roosevelt’s administration debated the role of government
in the economy in the wake of the 1937 recession, business leaders in the
South concluded from the Report, and their association of it with a grow-
ing liberal influence in the administration, that they needed an alternative
plan to instill confidence in the region’s manufacturing sector.52
Introducing the Report, President Roosevelt described the South as
“the Nation’s No. 1 Economic Problem.” This characterization catalyzed
emerging strains of conservative economic thought in the South, turning it
into opposition to the New Deal nationally. Although manufacturers, for
many reasons, remained fragmented, particularly over agricultural pol-
icy, the Report helped SSIC leaders maintained previous antistatist federal
involvement in the economy, but they had yet to connect that antistatism
to the idea of free enterprise with any specificity. New rationales against
federal economic policy would emerge haltingly as southern industrialists
responded to what they saw as an assault on the pillars of Dixie’s eco-
nomic growth and “southern civilization.” They understood that the fed-
eral government’s focus on changing the South’s low wages would cause
dramatic shifts in Dixie’s economy. While SSIC leaders could not predict
Brinkley, The End of Reform, 39–47.

52

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Free Enterprise and the Nation’s No. 1 Economic Opportunity 159
how the suggested changes would affect their interests, the Report fostered
an important move in their rhetoric. The industrialists’ emergent language
drew from the idea of “free enterprise,” with its emphasis on free, unregu-
lated markets –a move that would bear fruit in years to come.53
A war of words broke out among government officials and southern
business leaders over the Report. Fitzgerald Hall, the SSIC’s president
and head of the Nashville, Chattanooga & St. Louis Railroad, confronted
Lowell Mellett, the NEC’s executive director. Hall attempted to under-
mine the Report’s conclusions about the low earnings of southern labor
by criticizing the document’s color-blindness. The Report, indeed, in bas-
ing its analysis of the poverty of the South on geographical factors, did
not address racial inequality, although it was not in this regard that Hall
criticized the document. He argued that the average income and standard
of living were generally lower among blacks than among whites, and
that white southerners were burdened with the care of a proportionally
larger black population. “The problem is nationwide,” Hall asserted, “for
the relative economic position of the race is the same in every section
of the country, but is simply more noticeable in the South.” He agreed
that cooperation was necessary, but he pointed to further impediments
to southern development erected by non-southerners. Hall criticized the
Report for not investigating the South’s freight rate structure with any
thoroughness. Upon close analysis, he argued, the structure was far more
complicated than Washington insiders implied. Hall believed that south-
ern industrialists, who understood the South’s peculiar conditions, were
best equipped to confront the regional economic problems –not bureau-
crats stationed in Washington, DC.54
53 The Report cited “meager facilities” for research and development that would yield new
industries “especially adapted to the South’s resources.” SSIC leaders resented this sug-
gestion in particular, as this had been the goal they pursued in the development of their
region. Carlton and Coclanis, Confronting Southern Poverty in the Great Depression,
1–6, 76. Wright describes how federal policy “destroyed the logic of the family labor
system, and the ‘passing of the mill village’ followed soon after,” with similar disruption
of the plantation system. Thus, “Having little of the old low-wage economy to protect,
southern property owners opened their doors wholeheartedly to outside flows of capital,
government funding, and high paid labor.” Southern industrialists, unlike planters, were
“fragmented and ineffective,” especially regarding minimum wage legislation. Wright,
Old South, New South, 12–13, 15, 226.
Fitzgerald Hall, “Comments on the Report on Economic Conditions of the South,” 7
54
September 1938, SSIC Papers Box 3, Folder 3. Mellett’s response and Hall’s rejoin-
der can be found in Carlton and Coclanis, Confronting Southern Poverty in the Great
Depression, 139–148. Other southern intellectuals and leaders reacted negatively to the
Report, but without the SSIC’s vitriol. Howard Odum told an audience of industrialists,
0
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The SSIC, along with other prominent southern organizations such as

the Southern Governors’ Association (SGA), undertook a public relations
blitz that emphasized the South as the nation’s economic opportunity
No. 1 or, as Hall put it, the “No. 1 economic hope of the nation.” SSIC
leaders maintained that decentralization of industry, facilitated by the
South’s labor market and lower cost of living, offered greater prospects
for national prosperity than the continued reliance on the overcrowded,
overindustrialized northeast. Moreover, these men argued that the South
was a market for goods, and that they could avoid the image of “disrupt-
ing” northern industry with the lure of cheap wages by promoting the
location of branches of northern plants in the South. Southern industri-
alists asserted that protected labor markets and an investment-friendly
business environment would solve the South’s economic and social prob-
lems. Arguments centered on culture and tradition thus took a backseat to
political economy and antiregulatory positions in official SSIC statements
and policy publications. SSIC leaders and other industrial boosters elided
their region’s history of labor exploitation and instead emphasized the
South’s economic potential and “true” American spirit. Southern indus-
trialists began to abandon their reliance on the idea of a deficient South
to limit reform and constructed instead a positive image for the region.55
For southern industrialists’ vision to be legitimate, it had to transcend
reactionary, defensive statements and provide a bold, clear plan for the
future. Laissez-faire was too passive; the SSIC portrayed a policy land-
scape that would allow business to use government to incentivize devel-
opment while also precluding liberal reforms that would promote social
and racial equality and unify the South’s wages with the nation’s. SSIC
scientists, and scholars that the Report cataloged the South’s deficiencies “very well.” It
reflected his own thesis about “the fundamental lack of balance as reflected in our super-
abundance of physical and human resources alongside their misuse and waste and our
deficiencies in capital, technological, and institutional wealth.” But Odum also declared
that the time for “cataloguing” deficiencies was over, and such activities had “already
been featured enough to justify our proceeding … to meet the needs of the situation.”
He recommended education, research, public investment, and federal spending for build-
ing of infrastructure, social security, and relief. Howard W. Odum, “The Promise and
Prospect of the South,” address to Oklahoma Academy of Science, 2 December 1938,
Stillwater, OK, Odum Papers, Folder 629. Southern Historical Collection, University of
North Carolina–Chapel Hill.
Franklin Roosevelt, accompanying the Report, 5 July 1938, Carlton and Coclanis,
55
Confronting Southern Poverty in the Great Depression, 43; Kantor, “Howard W. Odum”
285; Howard W. Odum and Harry Estill Moore, American Regionalism: A Cultural-
Historical Approach to National Integration (New York: H. Holt and Company, 1938);
Prentiss Terry to Comer, 31 October 1938, DC 7.134.21.

1
6
Conclusion 161
leaders attempted to recast the region’s economic history as an economic

Cinderella story. In this narrative, built on the myth of the New South,
Dixie emerged from its backwardness to be the model for industrial and
economic development for the entire nation. Southern industrial leaders,
with their technological knowledge and access to capital, would merge
native agriculture and industry to complement the region’s natural abun-
dance, labor, and potential for growth. Supportive state and local gov-
ernments would create a public policy environment friendly to business
investment.
In articulating this vision, SSIC leaders relied on a set of ideas loosely
characterized as “free enterprise,” a phrase that emerged rapidly in the
mid-1930s in business circles. Its proponents used it to respond, as his-
torian Wendy Wall explained, to “mutualistic New Deal and CIO visions
of the nation by emphasizing individual rights and the libertarian dimen-
sions of ‘freedom.’ ” Southern manufacturers, building on rhetoric from
conservative corporate leaders and business associations, charged that
New Deal policies undermined local, state, and regional autonomy and
endangered southern industrial growth. These men’s vision for economic
policy accepted a role for government, so long as it catered to the busi-
ness climate industrialists wanted to create –one that preserved labor
markets and the existing social hierarchy. Localities would be free to craft
appeals for investment according to local customs and without federal
interference. In this way, southern businesses would be able to ensure
the “rights of employers.” Yet southern manufacturers’ full embrace of
the term had been complicated by the emergence of federal minimum
wage legislation, and the idea of building the “nation’s No. 1 economic
opportunity” depended on the debates and strategies that minimum wage
debates rendered passé.56
Conclusion
By 1938, SSIC leaders used the term “free enterprise” with regularity.
Previous citations of “natural” differentials between North and South
Wall, Inventing the “American Way,” 48–49. For how boosterism developed along in the
56
Southwest and emerging Sunbelt, see Shermer, Sunbelt Capitalism, passim. The SSIC’s
version appeared more diffuse and less specific than what emerged in Phoenix, because
the organization attempted to represent the entire South and thus elided specific devel-
opment plans (which would differ based on subregion and potentially place members in
competition) and focused on policy that would benefit the entire region and its various
subsectors of industry.
2
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1
became examples of a functioning free enterprise system, with national

implications. Prentiss Terry characterized the situation facing free enter-
prise in October 1938 as the “literal maintenance or overthrow of
it,” declaring that the country faced its most serious crisis since 1861.
In a public relations blitz in late 1938, Terry warned numerous audi-
ences: “[S]‌trike at the American system of free enterprise and you strike
at the very foundation of our social and economic structure.” Industrial
relations were on trial, he argued, and individual responsibility would
suffer at the hands of government interference as a centralized and con-
trolled bureaucracy. Although the SSIC continued to build regional soli-
darity and to promote the South as a site for economic expansion, SSIC
leaders also moved their ideological rhetoric in a national direction. They
began to appeal to American principles over southern values and pursued
political goals that would benefit small and medium-sized businesses over
the dominance of large manufacturers.57
Yet SSIC leaders resisted the temptation to expand their broader
political program in more ideological directions. Terry, who defended
free enterprise from federal intervention, also sought to help members
adapt to FLSA regulations. Terry left the council for a job in the wages
and hours administration in December 1938. Terry would later work
in the Department of Commerce, continuing his string of government
jobs, but he left a legacy at the SSIC of implementing a stronger public
relations mission and pursuing the image of the Nation’s No. 1 Economic
Opportunity to increase economic development. Wages and hours legis-
lation, for all the protests registered by SSIC members, remained a fact
with which they had to contend. Southern economic exceptionalism,
articulated in arguments such as “regulation without representation,”
had failed to stop this legislation.58
Congress yielded no strong political alternative that satisfied southern
industrialists. Moderation might serve the needs of southern industry in
the short term, but the region’s manufacturers yearned for a stronger
platform to challenge the New Deal. No longer seeking to work within
the New Deal, by the late 1930s, despite appearances to the contrary,
they sought to dismantle it. Meanwhile, as the FLSA targeted the South’s
low-wage labor market, southern industrialists found alternatives to pro-
tect and promote regional development.
Terry, “Industrial Relations.”

57
Terry to Comer, 1 December 1938, DC 7.142.16.

58

3
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1
Conclusion 163
The Report on Economic Conditions of the South and the FLSA

introduced new imperatives to preserve the organization’s economic vision
for the South. Even though the SSIC and southern liberals appeared to
share common cause on many of the concerns raised in the report, such
as discriminatory freight rates and difficulty accessing markets, they dif-
fered over how the government should approach these issues. As the SSIC
confronted these issues, alongside other proponents of southern industri-
alization, the organization’s ideological opposition to government inter-
vention in the economy, based in arguments to defend free enterprise,
became more coherent and consistent.
The SSIC’s main problem was that it did not boast a broad base of
support because of a narrow focus on the South and its established indus-
tries. Although the SSIC’s efforts to modify the FLSA introduced new tac-
tics that downplayed sectionalism, these interventions still lacked strong
enough arguments to garner support beyond the South. Politically, SSIC
leaders lamented the “Solid South,” but for practical reasons they would
not attempt to support a political alternative to the Democratic Party
until nearly a decade later.
Conflicts with other advocates for southern development, especially
the SGA –which SSIC leaders believed mistakenly used southern defen-
siveness, particularly on the issue of freight rates –also limited the emer-
gence of a political alternative. The outbreak of World War II provided
the SSIC with new areas to define and test their ideological arguments,
turning the organization’s purpose to national concerns. The FLSA had
inspired the adoption of free enterprise in SSIC leaders’ political rhetoric,
but these men had not fully tested this rhetoric in a wide range of policy
questions, nor had that language developed a specific enough meaning to
carry an entire program. That process had yet to unfold.59
E. J. McMillan at SSIC Annual Meeting, 26 January 1939, SSIC Papers Box 1, Folder 4.
59
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Rates, War, and the Turn to Free Enterprise
On November 5, 1940, Franklin Roosevelt became the first president

in American history to be elected to a third term, much to the cha-
grin of conservative southern manufacturers. At his State of the Union
address following the election, he recommitted to his vision of reform
in the midst of rising international tensions by outlining what he called
the Four Freedoms: Freedom of Speech, Freedom of Worship, Freedom
from Want, and Freedom from Fear. FDR’s opponents noted that only
the first two freedoms were guaranteed in the First Amendment to the
Constitution. The last two were New Deal constructs and fanned conser-
vatives’ fears that they could expect more government intervention in the
midst of world war. And in fact, by the end of 1941 –following Japan’s
attack on Pearl Harbor, the United States’ declaration of war, and the
subsequent declaration by Germany –the United States was committed
to World War II, with renewed federal interventions in hiring and wages.1
The Four Freedoms captured public imagination and anchored the war
effort. The Saturday Evening Post commissioned beloved artist Norman
Rockwell to paint four covers depicting the Four Freedoms, which ran in
February and March 1943. The edition with a cover dedicated to “Freedom
from Want” also contained an article by Louisiana governor Sam Houston
Jones titled, “Will the South Bolt the New Deal?” New Dealers seemed to
want to include “social equality” as a goal of the war, he charged, and this
offended Jones’s segregationist prejudices. Claiming to represent the entire
1 Franklin D. Roosevelt Annual Message to Congress, January 6, 1941, Records of the
United States Senate; SEN 77A-H, Record Group 46, National Archives, Washington,
DC, www.ourdocuments.gov/doc.php?doc=70.
164

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Rates, War, and the Turn to Free Enterprise 165
South, Jones wrote, “The New Deal Democrats have their method of solving
the race problem, and we have ours.” He saw southern white voters as fed
up with the New Deal and its social and economic engineering. Jones called
for a break with the Democratic Party and demanded a presidential candi-
date who spoke “our language,” whether he was “a Democrat, a Southern
Democrat, a Republican, or a Mr. No-Party-At-All.” Jones’s predictions
were premature, and the Solid South continued to vote Democrats into
office. No two-party South seemed feasible. Whether or not they were New
Dealers, a number of southern interest groups resented wartime efforts at
ensuring equality for African Americans, as well as the continued efforts by
the administration to regulate wages, hours, and prices.2
Jones’s pronouncement reflected the conclusions of southern manu-
facturers about the New Deal and its intentions toward the South. He
garnered support from influential New Orleans manufacturers, and
southern industrialists thought he might prove useful in blocking New
Deal reforms at the state level and in helping southern members of
Congress avert further legislation. But Jones was a liability. He embodied
many of the problems manufacturers faced in delivering their message
about what was best for the South. Most notably, they charged that Jones
had it all wrong when it came to freight rates –a seeming reversal among
the southern manufacturers who complained when Jones protested that
southern rates were too high. Southern manufacturers had long cited the
relative costs of moving southern-produced goods and raw materials to
markets. In seeking to limit the NRA, they used high transportation costs
to point to the region’s colonial and infant status. But the issue became
a lightning rod for controversy in the early war years and revealed the
rapid changes taking place among the South’s industrial representatives.3
SSIC board member and Louisville & Nashville Railroad president
James B. Hill penned a response to Jones’s article and distributed it
to all southern governors and senators, who were in the midst of a
campaign to reverse freight rate “discrimination” against the South.
Hill declared himself in line with the overall sentiment of Jones’s piece.
This was even though he too had been “raised a Democrat” by a father
who had served in the Confederate Army, and father and son, as many
other southerners had, took “refuge in the Democratic Party.” The time
2 Sam H. Jones, “Will the South Bolt the New Deal?” Saturday Evening Post, 6 March
1943, 20–21.
3 Michael L. Lurtz and Morgan D. Peoples, Earl K. Long: The Saga of Uncle Earl and
Louisiana Politics (Baton Rouge: Louisiana State University Press, 1991), 148–150.
61
166 Rates, War, and the Turn to Free Enterprise
for refuge had ended, Hill implied, writing, “Too many of them [white
southerners] still reside there because of the holding power of the mere
name.” Though he did not “class” himself as a Republican, he registered
as an Independent. Hill’s problem with Jones’s piece was not his depic-
tion of Democrats, or of the New Deal, but the governor’s assertion that
the freight rate structure “constitutes an odious barrier which causes a
discrimination of swindling proportions against the South and in favor
of the industrial east, much to the detriment of the Southern territory
in developing industry.” Hill cited freight rate “intricacies” and asked
the governor to consider several documents detailing the nature of the
southern rates and the potential harm that might come from revision
by Congress.4
Southern railway executives and industrialists protested Governor
Jones’s reliance on the old saw that the South was a colonial economy,
meager in land, labor, and capital. Jones wrote that the freight rate struc-
ture perpetuated the South’s inability to compete with national industry.
“It means, indeed,” Jones wrote, “that Southern factories must remain
few and far between and that we must continue to ship our sulphur
and hides and furs, our cotton and many other agricultural products,
to the industrial areas of the North and East, where they are processed
and the rich cream of ‘value-added by manufacturing’ skimmed off.”
Jones repeated the notion that the South’s industry concentrated on the
rough processing of raw materials to be turned into consumer goods
elsewhere.5
Yet Hill’s railroad served world-leading manufacturers located in the
South, and he named among them Alcoa, Burlington Mills, Monsanto
Chemical, and Union Bag & Paper, each of which represented the larg-
est manufacturer or plant in their respective industries. Southern man-
ufacturers, particularly SSIC leaders, disseminated depictions of the
South’s “infant” industry, but ongoing development led to alterations in
these definitions of the region’s industrial sector. Indeed, of the list of
world-leading industries in Hill’s report, twenty-three out of the thirty-
five companies listed were SSIC donors, and many of their executives
served in high positions in the organization, as well as other trade associ-
ations. In the 1940s, SSIC leaders mobilized to defend existing southern
4 James B. Hill to Sam H. Jones, 15 March 1943, copy, with attachments, in Lister Hill
Papers, Box 124, Folder 114. Lister Hill Papers, W. S. Hoole Special Collections Library,
University of Alabama, Tuscaloosa (hereafter cited as Lister Hill Papers). Jones, “Will the
South Bolt the New Deal?” 21.
5 Ibid.

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Rates, War, and the Turn to Free Enterprise 167
manufacturing as well as future investment, not just to protect fledgling

southern plants from northern wage structures.6
Whatever the situation of Dixie’s manufacturing, it did not benefit
short-or long-term growth, or existing industries, to have the region
appear laggard and the subject of discrimination. Some of the misconcep-
tions about freight rates, as Hill explained, stemmed from the improve-
ment in business conditions because of the war, particularly in the case
of well-established southern industries. They complemented the efforts
of other conservative business organizations, such as the NAM, but also
articulated a specifically southern message. The scope, as well as the foun-
dation, of their organization was shifting. Free enterprise became their
central principle, shared with other conservative business lobbyists, such
as NAM members. Still, among southern industrialists, the idea remained
defined through specific policies, even as it grounded the SSIC’s depiction
of the southern economy.7
As the war progressed, the SSIC continued to host annual Washington
dinners for southern congressional leaders to promote southern industrial
positions on policy. Yet changes were taking hold in this movement of
manufacturers. As in the case of other free-market groups, the years of
the war incubated southern manufacturers’ plans for a greater political
and public presence. In the course of identifying broader economic argu-
ments that would benefit southern development and preclude reforms they
opposed, SSIC leaders stumbled into arguments that downplayed southern
exceptionalism in favor of free enterprise, the fifth freedom to be added
to Roosevelt’s four. Embracing free enterprise, for southern manufacturers
in the SSIC, was not a matter of intellectual rebirth, but rather the result
of a series of confrontations with policy, beginning with the FLSA and
extending through the war years. During the late 1930s and early 1940s,
free enterprise replaced the rhetoric of southern economic exceptionalism
among the South’s politically active manufacturers with implications for
both the SSIC’s policy recommendations and its political organizing.8
The SSIC coalesced around the idea of free enterprise, but contro-
versies over freight rate “discrimination” revealed fractures among
6 Ibid. A. R. Smith, memorandum to James B. Hill, enclosed in Hill to Jones, 15 March
1943, copy in Lister Hill Papers, Box 124, Folder 114; Lizabeth Cohen, A Consumer’s
Republic: The Politics of Mass Consumption in Postwar America (New York: Vintage
Books, 2003), 102.
7 James B. Hill to Sam H. Jones, 15 March 1943.
8 For the origins of the Mont Pélerin Society, a transatlantic group of economists that
would define neoliberalism, see Burgin, The Great Persuasion.
8
6
1
the South’s ardent defenders. The question was how to best advocate
for the South’s continued economic development while also protect-
ing established industries. SSIC leaders resisted freight rate revision
because they feared undermining negotiated rates for existing manu-
facturers. Such resistance threatened to alienate the SSIC’s allies among
the southern governors as well as potential members from fledgling
industries without such rate advantages. Invoking free enterprise
helped the SSIC appear less intransigent, less defensive, and the idea
reshaped positions in a range of policy areas, leading to more coherent
interpretations of laws. Its emergence also made southern manufac-
turers’ strategy of working within the boundaries of the New Deal
obsolete.
As Jones did in “Will the South Bolt the New Deal?”, SSIC leaders ques-
tioned their own political strategies. Would they accept government largesse
when it benefited their companies or reject it on principle? Would they accept
continued wage and hour regulations in exchange for guaranteed profits and
war contracts? Such questions led SSIC leaders to seek practical examples to
make their case that free markets would grow the South’s industrial econ-
omy. Furthermore, these developments created a foundation for the SSIC to
move its organizational operation beyond the South, appealing for support
from a wider network in the postwar conservative movement.
War spending, particularly the distribution of defense contracts and
price controls, further convinced southern manufacturers that govern-
ment spending always played favorites among regions and that it was
time to roll back the New Deal. At the same time, the war increased
attention on the national implications of a socially and economically
laggard Dixie. The issue of defense contract distribution led the south-
ern industrialists to discover a broader cohort of potential allies among
small and medium-sized manufacturers and plants, a group that might
not respond to southern exceptionalism but would support arguments
based in the notion of free enterprise.9
9 The SSIC joined other corporate leaders who rejected WLB and NLRB policies and rul-
ings. While avoiding the overt antiunionism voiced by SSIC leaders and members, even
many “liberal” corporations initiated policies designed to weaken unions and contain them.
Harris, The Right to Manage; Jacoby, Modern Manors; Jefferson Cowie, Capital Moves:
RCA’s 70-Year Quest for Cheap Labor (Ithaca, NY: Cornell University Press, 1998). As
Andrew Workman demonstrates, John Edgerton’s old association, the NAM, and the SSIC
agreed on wartime procurement policy. Notably, each association reworked its public rela-
tions and internal organization during the war years. Andrew Workman, “Manufacturing
Power: The Organizational Revival of the National Association of Manufacturers, 1941–
45,” Business History Review, 78 (Summer 1998): 279–317.

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Freight Rates as Transition 169
The SSIC emerged from the war more ideologically consistent and
emboldened by the war’s aims, ready to leave behind restrictive regional
arguments to federal policies. SSIC leaders attempted to seize the idea
of decentralization and promote their version of it in the South; they
weakened their depictions of a separate regional economy, even before
reforms, the war, and defense spending undermined it in actuality. SSIC
leaders embraced rhetoric infused with free-enterprise language, solidify-
ing the transition begun during their response to the FLSA. They reinter-
preted southern history and economic identity, downplaying the region’s
image of laziness and lack of business leadership. They grew more aggres-
sive in their interpretation of federal involvement in the economy, argu-
ing that dating back to the Civil War, federal mismanagement had kept
the South an economic laggard, rather than climate, geography, railroad
exploitation in freight rates, or other “natural” features of southern liv-
ing. Though southern identity and southern interests remained fixtures of
the SSIC’s activities, the organization’s purpose transformed.10
Freight Rates as Transition

The freight rate debates of the late 1930s and early 1940s stemmed from
ICC policy updates and the expansion of southern manufacturing. Until
1920, southern railroads set most rates in the South, and these lines
shipped the majority of intraregional freight. The ICC rarely intervened
in rate setting within the region, but the Transportation Act of 1920 gave
the ICC greater jurisdiction to institute rate investigations. In the 1920s
and 1930s, it conducted several investigations into the South’s prevailing
inflated class rates, as reported in many industrial and political publica-
tions and speeches.
Stung by a series of decisions rendered by the ICC between 1925
and 1931, southern protests against “discriminatory” freight rates
increased. Manufacturers objected to a new and complex system of rate
10 Liberals used the war to further highlight the South’s problems. Frank P. Graham told
students at Tuskegee Institute in Alabama, “The Southern people despite all their faults
and failures, have heroically risen from the ruins of war and reconstruction, and yet,
despite a great tradition, find themselves under severe handicaps which constitute a
national economic problem emphasized by the war.” He cited freight rates, tariffs, and
maldistribution of wealth in industry and agriculture, as well as racial inequality, as the
region’s key problems, and he declared that equal opportunity in the South would make
a “freer and nobler America,” and help in “winning the war and winning the peace.”
Frank Porter Graham, “Founders Day address at Tuskegee Institute,” 2 April 1944,
Folder 4579, Scans 1–6, Frank Porter Graham Papers.
0
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determination that they considered ill-suited to the industrializing South.

Rate inconsistencies between regions developed as the South’s products
became a greater factor in national commercial activity. As one observer
noted, “A muddle of compromise, the system adjusts by complicated
formulae the price patterns of an older economy to the needs of new
industrial growth.” The South, advocates argued, was being punished for
being slow to industrialize. The transportation system emerged to suit an
agricultural region –not an industrial one.11
Freight rate rules set by the ICC were complicated and discussed in
impenetrable technical terminology such things as territories, tonnage,
basing points, blanketing rates, and distance scales. Despite the issue’s
complexity, self-appointed southern defenders used freight rate discrimi-
nation to argue for excluding the region from objectionable components
of the New Deal. The SSIC, most prominently, in 1933 and 1934 cited
discrimination in cost of shipping and proximity to markets as a major
reason for maintaining and expanding minimum wage differentials under
the ill-fated NRA. SSIC leaders circulated a list of southern “facts” to sup-
port their argument against federal intervention in the region’s labor and
industry: climate, “homogenous” population, low cost of living, “subnor-
mal” labor, and general lack of economic development –what SSIC lead-
ers referred to as the region’s “infant” industry. These arguments reflected
the prevailing ideas of a deficient South and its ill-treatment at the hands
of federal regulators.12
The freight rate disparity made an excellent political cudgel for SSIC
leaders. The issue, however, was more complicated than the SSIC and
other advocates presented it. Nevertheless, they could rely on the techni-
calities of rate setting to obscure their objective of preserving special rates
set with railroads while also using “discriminatory” rates to block other
reforms. The reason for rate complexity rests in the differences among
class, special, and commodity rates on shipments within the South and
to points outside the region. Class rates, the rates for goods grouped
according to similar characteristics, it was true, were higher on freight
traveling from the South to other regions. In many cases, an equidistant
route received a much higher rate from a southern to a northern city
than from one southern city to another. Yet regional commodity rates, the
rates charged to specific or related commodities, were comparatively low.
Robert Lively, “The South and Freight Rates: Political Settlement of an Economic
11
Argument,” The Journal of Southern History 14, no. 3 (1948), 178, 193. Lively criticized
later efforts to equalize class rates.
Margaret Mager, “Facts: Pertinent, Potent, Pungent,” 20 June 1934.
12

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Computed as an average of class and commodity rates, southern freight

rates were not much more than 5 percent higher than the average of all
rates across the nation. SSIC leaders could use the issue as an example of
the South’s mistreatment by the administration, which fitted their strategy
of working within the New Deal to carve out preferences for the region.
As southern governors and congressional leaders began to address the
problem of rates, southern manufacturers grew concerned that a revi-
sion –particularly the one set by Congress –might harm existing negoti-
ated commodities rates, and they began to rethink their position.13
A first round of ICC revisions proved uneventful, and most south-
ern manufacturers supported the changes. Class rates were important
to a diversifying economy. Goods shipped under such rates were of a
greater variety and included valuable, high-grade manufactured prod-
ucts. In 1937, an SGA- convened Southern Governors’ Conference,
seeking to maximize the shipment of higher-value manufactured goods
from the South (to promote diversification of industry), pursued a revi-
sion in interterritorial class rates and distance scales. A TVA transporta-
tion economist and future ICC chair, J. Haden Alldredge, contributed a
report, complete with economic evidence submitted by southern states.
The Alldredge report, which the TVA issued in six editions between 1937
and 1943, argued that the South’s primary problem with freight charges
was the surprisingly low rates on shipments within Official (i.e., north-
ern) Territory compared with southern and southwestern shipments into
Official Territory. Essentially, the North and Midwest could ship cheaply
within their own territory, whereas the South and Southwest encountered
barriers to trade both within and to points outside of their regions.
Alldredge’s report concurred with years of complaints from manufac-
turers that they had operated under higher transportation costs. Though
some states had lowered costs, as Alabama had done when Donald
Comer’s grandfather was governor, the region as a whole faced higher
rates when shipping outside the South. Moreover, the findings affirmed
that these higher rates damaged economic development. Alldredge con-
cluded that cost differentials for shipping goods over similar distances
“hampers, discourages, and retards” southern and western manufac-
turing. These arguments appealed to SSIC industrialists’ diagnosis of
13 Joubert prefaced his study of the southern rate structures, “It is a mistake to argue
that Southern freight rates are a wicked design purposely rigged to retard the South.”
Rather, he highlighted the geographic, market, and transitions in the economy that led
to distortions and discriminations. William Joubert, Southern Freight Rates in Transition
(Gainesville: University of Florida Press, 1949), vii, 342–380.
2
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1
the South’s economic lag and coincided with their hopes for a robust
industrial sector that could process the region’s natural resources into
industrial and consumer goods.14
SSIC leaders adopted the term “decentralized industry” for this vision
of southern manufacturing’s future. The SSIC’s spokesmen deemed
freight rates on traffic to central markets to be integral to this economic
vision. Some revisions in the freight structure were achieved in 1939
with the SGA’s efforts, but the matter was not yet settled. Southern class
rates remained higher in comparison with other territories. SSIC leaders,
however, had found strong allies for southern industrial development in
the SGA. Though united by their common vision for southern economic
development, unity between the SSIC and the SGA did not extend to pol-
icy as further revisions went forward.15
The ICC began an investigation of rates to prevent Congress from
intervening, and it held a series of hearings between 1941 and 1944.
Business support for freight rate alteration changed dramatically during
this ongoing Class Rate Investigation in the early 1940s, and the SSIC
served as the most vocal opponent of SGC-recommended revisions. Why
the reversal? SSIC leaders and their allies, from 1941 onward, opposed
further freight rate revision, citing the natural evolution of beneficial
commodity rates in the South, changes that favored southern industry.
The SSIC’s advocacy on the issue revealed the organization’s base in
established southern industry and these interests’ alliance with railroads.
The organization mobilized to coordinate further conversation on the
issue and to publicize leaders’ criticisms. In December 1941, the SSIC
organized the Southern Transportation Conference in Birmingham to air
the South’s transportation problems. Railroad executives, traffic manag-
ers, and industrialists testified regarding freight rate discrimination, which
produced occasional heated exchanges. At the heart of these confronta-
tions were disagreements over whether freight rate equalization would
benefit future industrial development or whether accompanying increases
in commodity rates would outweigh class rate revisions, thereby undoing
existing industries’ negotiated rates.16
J. Haden Alldredge, “Economic Conditions of the South,” Southern Democrat (Oneonta,

14
AL), 8 December 1938.
Ibid.
15
For a useful discussion of the freight rate investigations, and particularly the role of
16
Georgia’s Governor Ellis Arnall, see Harold P. Henderson, The Politics of Change in
Georgia: A Political Biography of Ellis Arnall (Athens: University of Georgia Press,
1991), 116–136.

3
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1
Southern carriers, supported by the SSIC, sponsored these discussions

of rate revision. Walter R. McDonald of the Georgia Public Service
Commission voiced the strongest support for the SGC petition. Although
McDonald praised the SSIC’s efforts to counter “present-day dangerous
trends, of which awareness alone can preserve our American institutions,
and our democratic government,” he declared that he found it “abhor-
rent” that any school of thought could exist that opposed the southern
governors’ conclusion in the pending rate investigation. He challenged
other attendees, stating, “Within the bounds of propriety and decorum,
may I remind you that there are those active in the promotion of this
meeting,” referring SSIC’s Traffic Committee members, “who have under-
taken to discount, if not debunk, the efforts of the SGC to bring about
economic equality.” Such “sabotage,” he charged, favoring low commod-
ity rates to the South’s detriment, would “serve only to draw our natural
wealth into the North for processing to our further impoverishment.”17
Alvin Vogtle, DeBardeleben Coal Corporation traffic manager and
an active opponent of the southern governors’ position, refuted the
McDonald’s figures, charging that the governors’ case rested on only a
handful of commodities. Rather, he explained, the discussions for revi-
sion appeared “against a backdrop of ‘damn Yankee discrimination,’
and, with a subject so technical, so complex, and so easily misunder-
stood, and with our hereditary prejudice against the North –which
dates from the Civil War, and the carpet-bagger regime of reconstruc-
tion days –our Southern people became so inflamed on this question.”
The case, in other words, had been built up by impetuous, emotionally
irrational southern defensiveness without full examination of the data.
For Vogtle, examination of market factors should and would temper the
firebrands who saw mistreatment of the South at every turn. He implied
that cooler heads would recognize the value of remaining an unregu-
lated free market or, rather, a market not forced to adhere to northern-
dictated wages and rates.18
A dismayed McDonald protested to the gathered group, “I thought
that we were coming over here to meet on common ground, and discuss
a common problem, fairly and honestly, and not organize a campaign
of resistance.” He said that he had come to the conference against the
advice of his coworkers and was now chagrined to find that the SSIC was
17 “Proceedings,” in the Southern Transportation Conference: South’s Industrial Economy

in Relation to the Pending Rate Investigation, under the Auspices of the Southern States
Industrial Council (Birmingham, AL: SSIC publication, 1941).
Ibid.
18
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1
“controlled by the railroad interests of this section.” McDonald’s charges

were not without merit. Railroad donations increased considerably with
the SSIC’s advocacy of positions close to their own. Indeed, many prom-
inent regional railroad executives served as leaders since the council’s
founding, including its second president, Fitzgerald Hall of the Nashville,
Chattanooga & St. Louis Railroad. McDonald was right: clearly,
SSIC leaders organized a campaign of resistance. The Transportation
Conference organizers hoped that the SSIC Traffic Commission’s exten-
sive research would convince rational men of business to join their side.
Nevertheless, freight rates, however dry the subject, were not exempt
from the passions of southern defensiveness.19
SSIC leaders thought that one argument overall would rally the various
groups: an appeal to antistatist and free-market ideas. As one presenter
explained, “We are all in this larger hole together, and while industry
will do everything possible in cooperation with the railroads to keep the
railroads out of government ownership, industry also wants to keep itself
out of government ownership and control and needs the help of the rail-
roads and others in doing so.” New Orleans pen manufacturer, conser-
vative political activist, and SSIC board member John U. Barr echoed
Gus Dyer, the Vanderbilt professor and longtime SSIC economic adviser.
Dyer called for a return of “constitutional rights to business.” He argued
that “this is no time … to tie up business in all sorts of restrictions …
I say, free the railroads of unwarranted restrictions they have had put on
them, and tell them to go to it.” While factions disagreed about the level
to which freight rates had hampered southern development, or over the
interpretation of data, debate participants tended to agree that the New
Deal specifically and government interference generally disadvantaged
the South.20
In 1943, the TVA released another report that bolstered the argument
for Congress to legislate a national class rate equalization. The TVA
report called for rate unification and suggested that the “regionalized”
rate structure impeded “national productiveness.” The report provoked
another firestorm of criticism from southern manufacturers and railroad
representatives. Birmingham traffic manager, A. J. Ribe, dismissed the
TVA report as “ ‘piffle’ and ignorant bliss,” declaring it the “most asinine
document I have ever read.” The report, in the context of wartime, com-
pounded Ribe’s antipathy toward federal bureaus and the “thousands of
McDonald, ibid.
19
Badger, North Carolina and the New Deal, 42. Dyer, in “Proceedings.”
20

5
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1
‘crack-pots’ twaddling in various Government Bureaus trying to solve

all problems by the ‘slide-rule’ method,” as Ribe colorfully put it. He
suggested that the draft board turn its attention to the men employed
in government bureaus as an example of “wastage” of manpower. Ribe,
along with other southern manufacturers, ardently opposed the proposed
legislation.21
That year, 1943, newly appointed SSIC Director of Research Thurman
Sensing reframed the freight debate to match the SSIC’s emerging rheto-
ric of free enterprise. Rather than belaboring statistics and tables, Sensing
boldly declared that freight rates did not impede southern industrial
progress, nor did rates discriminate against southern shippers in practice.
Sensing sidestepped charges that resistance to freight rate adjustment privi-
leged established southern industries over new development, declaring that
rate parity would cause more harm than good to the South. Sensing argued
that the true source of the South’s relative poverty was federal involvement
in the economy, not innate regional deficiencies. Discrimination occurred
in federal taxes and expenditures, he declared, not freight rates.22
Sensing developed a standard narrative about the South’s past that
invoked free enterprise. He recast the South’s economic lag as a result,
not of low levels of capital and business activity or even interference
from jealous competitors, but of federal meddling in the region dating
to Reconstruction. Until the establishment of the income tax, in Sensing’s
determination, revenues from customs, duties, and excise taxes “definitely
discriminated against low income groups and therefore against the whole
southern region.” He also cited discrimination in federal expenditures
toward the South, especially Civil War pensions and interest and amorti-
zation of public debt. Sensing reiterated the SSIC’s traditional arguments
about comparative costs of living; $300 per year, he argued, might be suf-
ficient to maintain the same standard of living for a farmer in Mississippi
as for a shopkeeper in New Jersey earning four or five times that amount.
Certainly, Sensing agreed that the South lacked comparative wealth, but
he was “unable to accompany [the SGC] on their long jump to the conclu-
sion that the transportation policy of the South has been the main cause of
southern poverty.” He appealed to long-held southern political traditions
21 Tennessee Valley Authority, Regionalized Freight Rates: Barrier to National Produc

tiveness, 78th Congress, 1st Sess., House document 137. A. J. Ribe to R. A. McCaffrey, 22
April 1943; A. J. Ribe to Lister Hill, with enclosures, 24 April 1943, Lister Hill Papers
Box 124, Folder 114.
Thurman Sensing, “What About Freight Rates and Southern Progress?” SSIC publica-
22
tion, 3 September 1943, SSIC Papers Box 4, Folder 2.

6
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1
but also introduced an alternative to white supremacy as a concept around

which to base conservative arguments against New Deal liberalism.23
Sensing attempted to reverse the South’s reputation as merely a source
of raw materials. Contrary to the ICC study to which he referred, Sensing
argued that the South was not being “drained” of its raw materials, and
he cited the study’s examination of 31,860 carloads originating in the
South. More than half of these loads, 56 percent, terminated in the South,
meaning that the raw materials sourced in the South remained in the
region to be processed into industrial or consumer goods. Forty percent
went to northern states; the rest traveled west. Furthermore, he argued,
coal accounted for half of the carloads headed north. For the rest of the
materials –mostly lumber and its products, such as plywood –Sensing
argued that these could not be classified as raw materials. In fact, Sensing
argued that complaints about freight rate discrimination damaged and
discouraged the development of southern industry, not the rates them-
selves. Sensing and his compatriots in the SSIC rejected the colonial label
for the South’s economy, declaring that reputation as bad for business.24
Other manufacturers sounded similar concerns. Numerous business
leaders wrote Senator Lister Hill of Alabama, one of the key sponsors of the
freight rate legislation. They voiced concerns that existing commodity rates
would be revised upward, particularly on coarse materials such as pig iron,
coke, sand and gravel, and pulpwood. SSIC members writing to Hill pro-
tested that the existing rate structure might have flaws but was not deserv-
ing of wholesale revision. The Depression created numerous burdens for the
railroads and shippers, but the war had reversed this trend. Most described
the rate structures as “practical, experienced and fair” and charged that the
proposal for equalization of freight rates seemed to rest on a theory that
made no promise, as one manufacturer put it, of “economic improvement
to the effected [sic] groups.” Those dependent on cheap shipping for raw
materials claimed that equalization of class rates would “naturally” lead
railroads to raise the commodity rates, which would be “detrimental to the
Southern industry as a whole.” Though spokesmen for the railroads and
the SSIC tried to downplay the South’s image as a primarily raw materials–
producing area, core southern industries still depended on commodity rates
because many of the region’s industries processed products from farm and
mine into goods for sale in both southern and national markets.25
Ibid.
23
24 Ibid.
Fred H. Marshall, Marshall Lumber & Mill Co., Montgomery, AL to Lister Hill,
25
11 October 1943, Lister Hill Papers, Box 124, Folder 117; Henry Ware, Miller and
Company, Inc., to Lister Hill, 1 October 1943, Lister Hill Papers, Box 124, Folder 116.

71
SSIC members also criticized the method of rate revision, fearing the
politicization of an issue better left to industrialists and experts. Most
protested that Congress should not be in the business of “rate-making”
and that, as one grain processor explained, “The years of experience
and knowledge of the entire Nation’s transportation setup [the rail-
roads] and the geographical problem of each section within itself is
sufficient evidence that [the rate structure] should not be molested.”
In other words, railroads had accumulated decades of data on mar-
kets and geographic conditions, and were best equipped to set rates,
not Congress. The ICC “has the respect of both shippers and carri-
ers,” a cast-iron-pipe manufacturer wrote, and revisions should not
be legislated. The vice president of the Southern Kraft Division of
the International Paper Company declared that the proposal was a
drastic change “by legislative fiat.” Even if previous revisions secured
by the SGC had produced beneficial results, the paper manufacturer
explained, the success “should not cause us to lose our balance and
go after a wholesale general revision of our rates in the South and
Southwest, resulting in real hurt to these sections.” Alex Hancock of
the Hancock Company, a general contractor in Mobile, Alabama, went
further and protested the proposal as “drastic legislation,” suggest-
ing that no agency could regulate rates. The proposal that any agency
could, he wrote, “I feel is rather bureaucratic.”26
Beyond the sense that Congress would not have a benevolent atti-
tude toward the South, a number of manufacturers’ protests against
class rate equalization invoked a nascent version of free-market ide-
ology. The president of Alabama By-Products, whose company dealt
in ammonia, benzol, coke, and tar, declared that southerners wanted
“flexible” rates to allow “the free movement of products from producer
to consumer.” The railroads bore this obligation, with the ICC provid-
ing oversight to make sure shippers lived up to their responsibilities. He
declared that Alabama was “making great progress towards a balanced
economy” among agriculture, industry, and labor, and that “some arbi-
trary rule or theory of rate making” should not be allowed to interfere.
Other manufacturers echoed the call for “flexibility” in rate setting.
While many of the protests emerged from dealers and processors of raw
materials, these manufacturers found representation of their arguments
in even stronger form from the SSIC, the widely accepted representative
B. McCall, Western Grain Company to Lister Hill, 6 October 1943; W. D. Moore,
26
American Cast Iron Pipe Company to Lister Hill, 5 October 1943, Lister Hill Papers Box
124, Folder 116.
8
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1
of southern industry, as well as many other trade associations in the

South.27
Economists would later concur with the SGA and not the represen-
tatives of established southern industries. A Duke University professor,
writing in concert with analysts who studied the rate issue in 1947, con-
cluded that though class rates were indeed higher, exception, commodity,
and column rates all tended to lower the actual rate paid by shippers
in the South, whether on intraregional or on interregional shipments.
But given that these rates were negotiated, it was “cold comfort” to new
industrial sectors seeking to locate in these areas with higher class rates.
Individual cases also gave testament that not all manufacturers in the
South participated in beneficial negotiated rates. The economist criticized
both southern manufacturers and southern governors for their depiction
of the issue in the 1930s: they either gave the matter too much weight as
a barrier to economic growth or oversimplified the rate issue for political
gain. Yet whatever the motives of those criticizing the rate system, he
concluded, rates had retarded southern industrial development.28
Nashville was a long way from Geneva and Paris in 1938, where
opponents of Keynesian economics began to organize, but southern busi-
ness leaders were developing their ideas along similar lines and operating
within a broader circle of conservative activists. During the freight rate
debate, SSIC spokesmen attracted the support of philanthropic conser-
vative businessmen interested in building institutional support for free-
market ideas. Albert C. Mattei, president of the Honolulu Oil Corporation
and future founder of the Foundation for Economic Education (FEE), a
libertarian public outreach organization, donated $2,000 to the SSIC in
1942 and later joined the board of directors. In arguing that equalization
threatened to destroy the rate system established by years of negotiation
and the natural evolution of prices, SSIC leaders manipulated the freight
rate controversy to provide the conservative free-market movement with
a perfect example of a functioning free-enterprise system –an idea as
mythical as the Lost Cause, but nevertheless one that held significant
sway in the public imagination. The narrative asserted that prior to 1920,
freight rates had been set without bureaucratic interference, resulting in
a mutually beneficial rate system that reflected the natural contours of
J. W. Porter, Alabama By-Products Corporation to Lister Hill, 11 October 1943, Lister

27
Hill Papers Box 124, Folder 117; Prince DeBardeleben, Alabama Fuel & Iron Company
to Lister Hill, 8 October 1943, Lister Hill Papers, Box 124, Folder 116.
Frank. L. Barton, “Economic Effects of Discriminatory Freight Rates,” Law and
28
Contemporary Problems, 12, no. 3 (Summer 1947): 507–531.

9
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southern geography and industry. Federal meddling, Sensing charged,

disrupted a natural, functioning free-enterprise system.29
Free enterprise set freight rates, in Sensing’s view. “Rather than dis-
criminate,” he explained, “southern freight rates vary, just as the cost
of electricity varies, just as the price of oysters and oranges and shoes
and stoves and watermelons and lobsters varies in different regions of
the country.” In this vision, the federal government provided distant
oversight, via the ICC, ensuring that rates and practices did not get out
of hand or so competitive as to be destructive to the flow of goods to
markets. Market forces set the prices of commodity shipments –manu-
factured, agricultural, or otherwise –depending on intraregional supply
and demand. “Open competition and free enterprise are great levelers
of prices,” Sensing explained. “So it is with freight rates.” To a grow-
ing number of southern manufacturers, the negotiated commodity rates
for raw materials and manufactured products represented the natural
evening-out of prices and competitive conditions. Higher prices, Sensing
argued, also guaranteed profits for southern railroads, which were essen-
tial to industrial development. Downplaying discrimination in freight
rates also served a public relations function: it helped refashion the South
as the “Nation’s Economic Opportunity No. 1” by shifting rhetoric away
from the region’s deficiencies and toward its potential.30
The SSIC, after publication of the Report on Economic Conditions of the
South in 1937, joined in a region-wide effort to stimulate southern develop-
ment and counteract what many southern leaders felt were damaging stereo-
types. The main problem with these movements, in the view of SSIC leaders,
was that the various groups lacked unity. The SSIC, after all, represented
established southern industries. Leaders declared that they stood for south-
ern development, but they often placed the needs of existing plants over con-
ditions that would further new development. Prentiss Terry described these
efforts in a letter to Birmingham journalist John Temple Graves II. After
listing interested organizations such as the SGA, the Southeastern Council,
the council of Southern Regional Development, the All-South Council at
Dallas, the SSIC, and the upcoming SCHW in Birmingham, he wrote:
And that is the crux of the trouble with the South –many organizations of a
local, state, trade and south-wide nature, all working alone and unto themselves
29 Richard Cockett, Thinking the Unthinkable: Think-Tanks and the Economic Counter-

Revolution, 1931–83 (London: Fontana Press, 1995), 55–56. See Phillips-Fein, Invisible
Hands, chapters 1 and 2.
Sensing, “What About Freight Rates and Southern Progress?” 8–9.
30
0
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1
in their various spheres of activities and areas without sufficient coordination

or cooperation between or among them. It seems to me that the time has come
when southern leaders must evolve a closer basis of cooperation for the solution
of human and economic problems common to the southern states, by the crys-
tallization of opinion among southern people of a consciousness of the South as
a regional unit.
Terry lamented the “man-made handicaps” imposed on the South, but

he echoed the belief that attention focused on the South would even-
tually highlight the region as “the No. One Economic Hope, the No.
One Business Opportunity, the No. One Area of Promise, of the Nation.”
Closer coordination among interested elites, he hoped, would allow the
realization of this goal.31
It is significant that the SSIC and the SGA were in opposition on
the issue of freight rates. The SSIC and the SGC could both be consid-
ered booster groups, each seeking to attract investment by promoting
the South as having a beneficial business climate. Manufacturers were
divided, as historians have documented, and their divisions stemmed
from their inability to reach consensus on what policies would preserve
and promote the South’s manufacturing sector. The freight rate contro-
versy revealed the difficulty of balancing the policy demands of exist-
ing industries and boosters, though these groups often overlapped. The
SSIC’s purpose remained to develop the region’s industrial economy and
to advocate for the region through public relations strategies. But the
SSIC invoked free markets to defend existing industrial sectors, not to
promote new developments and lure capital investment. Moreover, the
debate placed manufacturers at odds with their closest allies in Congress.
To pursue political connections and to build a political movement, they
needed to create more coherence.32
31 Prentiss Terry to John Temple Graves II, 3 October 1938, Donald Comer Papers
7.134.22.
John Temple Graves II published a well-
32
received article in the New York Times
Magazine in September 1938, and the SSIC added to the positive tone he set. Graves
acknowledged the attention granted to the South, writing, “Not since the Civil War
have Americans been so conscious of the South. Nor has the South been so aware of
itself.” Graves heralded a “southward march of industry” that accelerated during the
Depression years and developed southern resources such as yellow pine and agricul-
tural and natural resources beyond cotton. John Temple Graves II, New York Times
Magazine, 11 September 1938, 4; Wright, Old South, New South, 226. Industrialists
within the SSIC were also divided on the issue of freight rates. Former SSIC vice pres-
ident Donald Comer coordinated with the SGA in seeking congressional revision of
rates. The disagreement helped distance him from the organization. Joubert, Southern
Freight Rates in Transition, 339.

1
8
SSIC leaders denied that their position against freight rate legislation
represented anticompetitive motives in favor of railroads, even though
transportation interests clearly saw the SSIC as an ally. Sensing defended
railroad revenues as key to southern industrial development. More
railroads supported the SSIC in the late 1930s and early 1940s, and
their donations soared, peaking in 1943 during transportation revision
bill deliberations. Major lines such as the Louisville & Nashville, the
Illinois Central, and the Atlantic Coast Line donated generously to the
SSIC in 1943. While railroad companies represented only 1 percent of
SSIC donors in 1943, their combined contributions represented more
than 6 percent of funds received by the Nashville office for that year
(Figure 3). Sensing explained, “Southern railroads are naturally anx-
ious to see industry prosper in the South. Why should they want to kill
the goose that lays the golden egg? Transportation is the only thing
they have to sell.” Sensing warned that under equalization railroads
would lose revenue, which would damage the transportation system
and “cripple” the South’s leading industries. Consumers would suffer
while northern manufacturers would reap the benefits, as they would
receive larger reductions in rates while prices would remain largely
unchanged.33
In 1943, SSIC president Rush Cole, a vice president of Monsanto
Chemical Company and general manager of its phosphate division,
disseminated this refashioned view of freight rates to serve the cause
of southern industrialization. The South depended on free functioning
railroads, as well as on public perception that the region had the poten-
tial to grow. Cole, writing for Monsanto’s house publication, Monsanto
Magazine, depicted the South as primed for development. No longer the
destitute region of Gone with the Wind, Cole argued that the South was
“flush with war contracts” and an influx of wartime labor. He depicted
a region bright with industrial know-how and rich in untapped raw
materials. He celebrated Monsanto’s new plants and the levels of pro-
duction of wood pulp, phosphorous, and cotton. He dismissed the idea
of freight rate discrimination as a “misconception” and a “fallacy” and
predicted that existing rate differences would “add their encouragement
to Southern enterprise.” For southern manufacturers such as Rush Cole,
Ibid., 10. The L and N’s role in the SSIC reflected the long-standing influence of the rail-
33
road, and others like it, in southern development and politics and the economic identity
of the region. In seeking monopoly in Kentucky in the 1870s, “the L and N managed to
identify its cause with that of the downtrodden South.” Woodward, Origins of the New
South, 7.
2
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1
Railroad Donors vs. Donations to the SSIC, 1934–1947

7.00%
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946
1947
% of Donors % of Donations
Figure 3 Railroad donors vs. donations to the SSIC, 1934–1947.
Source: By the author. Data courtesy of Tennessee State Library and Archives,
Account Books (compiled).
continually emphasizing freight rate discrimination was simply bad for

business and undermined their public rebranding of the South. Cole saw
no inadequacy with the South’s transportation system for the develop-
ment of new industry.34
The rate issue faded after May 1945, when the ICC ruled that all
class rates should be uniform. In 1947, the Supreme Court upheld the
ruling and removed the last obstacle to equality of class rates among
three geographical areas –South, North, and West. In simpler terms,
the ICC began dealing with class rates on a nationwide basis rather
than by region. The SSIC would not get its way on the matter of freight
rates. Yet these debates clarified the fact that ardent sectionalism –the
preserving of regional economic and cultural interests –limited the
SSIC’s ability to attract conservative allies. Albert Mattei and other
potential non-southern allies instead looked to the FEE, founded in
1946, as an avenue for the spread of free-market economics. Mattei
34 Robert Rush Cole, “Southern Plenty for Post-War Plowshares” Monsanto Magazine,
August–September 1943.

3
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1
remained a generous donor and an honorary board member, but the

SSIC’s regional mission proved too limited to promote free enterprise
beyond the South.35
The SSIC remained a protectionist organization. Leaders promoted
policies to preserve existing industries even as they embraced the brand
of free enterprise for the South, rather than relying on southern economic
exceptionalism. SSIC leaders remained convinced that the South would
not receive equal or fair treatment, a point of view that began to attract
weary New Dealers. In January 1942, the SSIC reprinted a column by
their now-stalwart ally, John Temple Graves II. Graves wrote a regular
column in the Birmingham Age-Herald, in which he praised efforts to
raise southern interests in Washington to benefit the nation. In particu-
lar, he noted the contradiction between strong southern representation
in Congress and the absence of southern control of federal bureaus and
agencies. He remarked that Washington, DC had once been a “quiet
Southern town on the Potomac,” but that in 1942, “It is not quiet. It is
not Southern. And it is not a town. It is a bustling, fighting city that was
once Southern.” Furthermore, he remarked,
What is left of the South in Washington is in an anomalous position. The South
in large measure controls Congress. The Speaker of the House is Southern. The
majority leader of the Senate is Southern. The majority of the Major committee
chairmanships are held by Southerners … But “down town” –in the departments
and agencies –where fundamental decisions of policy are made, the South is in
the minority, very definitely in the minority. In many of the key agencies the South
is not even represented.
Graves’s concerns related to bureaucratic control over wartime agen-

cies, in which “only an occasional [Franklin Porter] Graham of North
Carolina or [Donald] Comer of Alabama can gain admittance.” Beyond
concerns over distribution of defense contracts, Graves argued that the
lack of educational opportunities in the South hampered the region’s
ability to seat representatives on these administrative bodies –whose
members tended to hail from Harvard, Yale, and other prestigious north-
ern universities. SSIC leaders concurred with Graves’s assessment, partic-
ularly in his application of these arguments to the South during wartime.
Even with political power balanced in favor of the South, and a conser-
vative alliance functioning in Congress, the established bureaucracy of a
welfare state meant the SSIC’s members had to contend with continued
regulation of wages and hours. As the war progressed and reshaped the
Sensing, “What About Freight Rates and Southern Progress?” 14.

35
4
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1
southern industrial economy and the region’s labor force, new concerns
emerged among the region’s manufacturers.36
Free enterprise set freight rates, in SSIC leaders’ new rhetorical strategy,
but it did not provide the region with greater access to war contracts. The
war presented SSIC leaders with the paradox of maintaining an anti–New
Deal stance while arguing for wider distribution of war contracts. This
activism contradicted leaders’ emerging position that free enterprise would
ensure equal distribution and fair competition. The war would have a sig-
nificant influence on the SSIC’s activism. It helped leaders identify and con-
solidate their vision for the South’s economic future, as well as solidify the
SSIC’s position on federal intervention in the economy and the South –that
no good could come of it. Wherever the federal government intervened in
the economy, they argued, the South was unlikely to receive fair treatment.
Pursuing Decentralization through

Wartime Mobilization
For southern industrialists, particularly those with small plants, the war
seemed to confirm the SSIC’s position that any government attempt to man-
age the economy inherently disadvantaged the South. The SSIC officially
supported the war and private mobilization, but defense procurement activ-
ities, as leaders interpreted them, confirmed their beliefs about the treatment
the South would receive from “down town” Washington, as Graves had put
it. Business leaders, particularly corporate executives on the staff of the War
Production Board (WPB) in Washington, favored the established industries
that SSIC leaders had long charged with benefiting from federal largesse.
While business, in general, experienced a resurgence in status stemming
from war production, the war also facilitated southern employers’ contin-
ued efforts to reshape the South’s economic reputation. Furthermore, the
war emboldened southern manufacturers’ attempts to define decentralized
industry differently from the way liberals invoked the term, which empha-
sized federal support and planning. If the federal government were to be
active in the economy, even if for defense, southern manufacturers argued
that policies should benefit the development of southern industry just as
tariffs and subsidies had promoted northern industrial growth.37
36 John Temple Graves II, “This Morning” Birmingham Age-Herald, 24 January 1942.
Reproduced by the SSIC, SSIC Papers Box 4, Folder 1.
The war did not abate booster efforts to lure industry to their communities, and they
37
sought corporate-
friendly policies during the disruptions to capital in the 1940s.

5
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1
Pursuing Decentralization through Wartime Mobilization 185
The war and wartime bureaus such as the National War Labor Board
extended New Deal programs’ intervention in wage rates and shop-floor
disputes and invited labor and business participation in “nationalizing
a conception of routine and bureaucratic industrial relations” emerging
since the Wagner Act. Conflicts, particularly regarding small business
efforts, arose regarding policy, and fears of inflation weakened federal
calls for wage increases. For the SSIC, however, concerns regarding mobi-
lization pertained not to small business alone, but rather to the nation-
alizing forces that leaders saw as inadequately mindful of the nature,
structure, and orientation of southern industry and its future growth and
development of homegrown capital.38
Southern manufacturers recognized that war investment would prove
transient. In 1940, an SSIC letter to its membership declared that the
region had failed in its efforts to develop industries with “Southern cap-
ital, rather than relying upon established organizations elsewhere to set
up branches in this section.” Moreover, southern manufacturing had
shown a “neglect of basic economic and industrial research designed
to provide new and commercially profitable uses for the products of
our farms, mines, and forests.” Lack of industrial research hampered the
development of a “better balanced economy,” SSIC leaders pointed out,
and no federal program emerged to tackle that problem. Decentralization
of industry took on different meanings during the war years: it meant
developing industry and products that were better suited to the South’s
raw materials and manufacturing environment –the so-called balanced
economy approach; it also referred to the equal distribution of defense
contracts outside established industrial centers, which would, in turn,
benefit established firms as well as promote the growth of new ones.
Southern manufacturers feared, from the first days of conflict, that war
contracts would not alleviate the region’s deficiencies in capital and
innovation.39
Established industries in the South focused on promoting policies to protect their wages,
which rose during wartime, and advertised the benefits of southern contracts. Shermer,
Sunbelt Capitalism, 72–73, 90.
38 Employer representatives on the NWLB tended to be New Dealers, a “minority wing of
the business establishment,” who preferred the large-scale bureaucratization to rationalize
labor-management relations. The NWLB also included liberal southerner Frank Porter
Graham, who supported racial equality, a wartime goal southern manufacturers resented
as an intrusion into local affairs. Lichtenstein, Labor’s War at Home, 51–53, 70–71, 82.
Southern manufacturers had good reason to worry. Many plants built during the war
39
were shuttered during reconversion. Shermer, Sunbelt Capitalism, 72; Harris, The Right
to Manage, 41–42; SSIC Letter Service, 14 September 1940, SSIC Box 3, Folder 3.
6
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1
SSIC leaders may have resented the administration’s depictions of

the South as an economic problem, but with war mobilization, man-
ufacturers attempted to use those criticisms to the region’s advantage.
They largely ignored what historians have viewed as strong concessions
to business interests in favor of war mobilization, namely the financial
reward of war production and the protection from risk. Manufacturers
viewed these concessions as obligatory on the part of government, and
they wanted the South to receive its “fair share” of contracts. While the
South benefited from wartime industrial policy and federal investment
during the war –overturning SSIC predictions –the war did not alter the
region’s dominant industrial pattern. Although SSIC often stood for a
“more industrialized, more enlightened, more affluent South,” the coun-
cil’s regional defensiveness shaped its wartime critiques of government
action. The war also enhanced the SSIC’s activism on behalf of estab-
lished southern industries and for the decentralization of the wartime
economy, as SSIC leaders called it.40
The idea of decentralization of industry, as invoked by SSIC leaders,
grew more complex during wartime. Industrial expansion did occur in
the South with federal defense-related expenditures in the region, but
growth tended to be “site-specific and localized” in effect. Federal invest-
ment spurred growth in established port cities and remote, inland loca-
tions. Contrary to SSIC industrialists’ hopes, defense spending produced
an “ambiguous legacy, injecting income but, outside certain locales, doing
relatively little to develop skills, institutions, or entrepreneurship.” These
unaccomplished goals served as the central feature of what SSIC leaders
referred to as decentralized industry.41
Industrialists’ references to decentralization denoted protection of
existing industries and the building of new ones, which would be drawn
to the area by its attractively low labor costs, natural resources, and
friendly business environment. The War Production Board (WPB) and
Smaller War Plants Corporation (SWPC) defined the term differently. War
planners decentralized munitions plants for defense reasons. The WPB
and SWPC also sought to distribute contracts across regions, and the
SWPC’s existence suggested the political support smaller manufacturers
received, though insufficient to their demands. Furthermore, the SSIC’s
definition was a long way from the academic applications advanced
40 Schulman, From Cotton Belt to Sunbelt, 124; Scott, “Winning World War II in an Atlanta
Suburb,” 2; Carlton, “The American South and the U.S. Defense Economy,” 158, 162.
Harris, The Right to Manage, 41–42; Scranton, The Second Wave, xi; Scott, “Winning
41
World War II in an Atlanta Suburb,” 2.

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1
by social scientists and regional planners. SSIC interests wanted local

control, whether to use policy to lure investment or to maintain employ-
ers’ leverage over labor, not development sparked by outside planning.
SSIC leaders were unwilling to see the federal government and regula-
tions grow any more intrusive, whatever the cause. The further planners
were removed from manufacturers, SSIC leaders cautioned, the more
they would undermine the southern manufacturers’ vision for decentral-
ized industry.42
SSIC leaders welcomed defense contracts to the region, if distributed
“fairly” (though they never defined what fair distribution would look
like). Moreover, contracts combined with continued regulations and
reforms were objectionable. The reputation of business improved during
the war years, but southern manufacturers argued that they could not
capitalize on a revitalized reputation, an assertion designed to increase
support for revising labor laws. SSIC leaders highlighted continued wage
and hour regulations as evidence that pressure groups, such as unions,
continued to maintain control of key administrators and policymakers.
In the way that southern manufacturers had perceived no commonality
with northern industry on the issue of labor organization in the 1930s,
during wartime they could not envision a platform that would yield allies
from non-southern areas regarding decentralized procurement, not even
from small and medium-sized manufacturers. Southern manufacturers
argued that, once again, northern industry used its influence in politics to
gobble up subsidies –in this case, war contracts.43
SSIC leaders also sought to be of use to their organization’s members.
Shortly before Pearl Harbor, the SSIC sponsored a series of “defense clin-
ics” in cooperation with the Office of Production Management (OPM)
to combat “serious problems” arising in the distribution of materials and
contracts. After the United States entered the war at the end of 1941,
The SSIC advocated local control and the value of cultural institutions alongside “decen-
42
tralization,” but the SSIC preferred to maintain social control by elites, not to promote
democracy and shared resources. Localism and decentralization also influenced com-
munity development in the global South in the same period, a movement distinct from
the development goals of local manufacturers in the U.S. South and which shared more
with agricultural and community planning and linked to liberals like Odum. Immerwahr,
Thinking Small, 46.
Jonathan J. Bean argued that the SWPC failed in its mission, nationwide, to decen-
43
tralize industry, explaining, “the wartime placement of defense contracts and loans
matched the regional distribution of manufacturing prior to the war.” Jonathan Bean,
Beyond the Broker State: Federal Policies Toward Small Business, 1936–1961 (Chapel
Hill: University of North Carolina Press, 1996), 118, 123. See Lichtenstein, Labor’s War
at Home.
81
the SSIC depicted systematic unfairness to the South concerning contract

distribution and infrastructure investments, and advocated for southern
industries to receive their “fair share.” Three issues dominated leaders’
rhetoric about defense contracts and the South, all of which revealed
their inability to relinquish fully the idea of the disadvantaged South,
despite its potential problems for the region’s industrial image and the
cultivation of allies.
First, SSIC spokesmen argued –as they had done since the begin-
ning of the New Deal –that distribution of federal defense spending, as
with relief expenditures, disadvantaged southern states. Not only could
Congress and executive bureaus not be trusted to evenly distribute funds
on a per capita basis; they also failed to exercise restraint and common
sense in the allocation and spending of federal tax revenues. The South,
the SSIC argued, already suffered disproportionately from New Deal reg-
ulations, and war production would only compound these problems. For
this reason, SSIC General Counsel Tyre Taylor declared that the South had
a “special stake” in the decentralization of defense production. The New
Deal had already upended the South’s low-wage advantage by national-
izing wages. The SSIC also feared the federal government becoming the
controlling interest in southern manufacturing. Southern manufacturers
wanted to maintain control in their mills and to break up the harmonious
relationship, as they saw it, between large, northern and midwestern cor-
porations and the federal government, which required equal distribution
of contracts to the South to amplify Dixie’s representation in defense
procurement. Federal involvement in shaping the southern economy at
the microeconomic level, without advice from southerners, according to
SSIC rationales, would undermine the conditions necessary to lure busi-
ness investment to rural areas.44
Second, SSIC leaders argued that southern manufacturers experienced
greater hardship because of shortages in raw materials as raw materi-
als were reallocated to defense manufacturing and away from consumer
goods. Small southern and rural manufacturers had fewer resources to
weather such disruptions, they argued. Tyre Taylor, in a press release,
stated of decentralization, “If it can be made to work, it will prevent the
closing of hundreds of small plants which now have no defense orders
and are unable to obtain raw materials for their normal peacetime pro-
duction.” The uneven distribution of war contracts to areas outside the
South, SSIC leaders maintained, placed greater disadvantages on southern
Tyre Taylor, Press Release, 10 October 1941, SSIC Papers Box 4, Folder 1.
44

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1
industries that depended on the availability of raw materials, particularly

small plants that were still experiencing depression conditions. More
even distribution of contracts could alleviate these problems. The SSIC
thus pursued close cooperation with OPM officials in the Division of
Contract Distribution; they invited representatives to the SSIC’s annual
meeting and to special clinics in several southern cities in 1941 to explain
to attendees the distribution of defense contracts and how industries
might go about securing them.45
Third, SSIC leaders protested federal funding of improvements in
transportation infrastructure in the North and East, which they argued
concentrated industry –especially the defense industry –in those regions.
An example of proposed improvements was the St. Lawrence Seaway,
a system of canals, dams, and other infrastructure for the movement of
goods between the Great Lakes and the St. Lawrence; a number of hydro-
electric plants would be installed as well. The Seaway proposal revisited
long-standing divisions among regional business interests, as well as large
and small firms. Although the Senate defeated the project (as a treaty with
Canada) in 1934, the proposed waterway received renewed attention as
a tool of national defense. The SSIC cooperated with other organiza-
tions in the National St. Lawrence Project Conference in 1941. The meet-
ing drew representatives of state-level Chambers of Commerce, carrier
associations, and other trade associations. Meeting organizers published
the concerns discussed about the project (a pamphlet later reprinted and
distributed by the SSIC). The attendees protested that the St. Lawrence
Seaway would not contribute to the current war effort, arguing it would
be completed by 1947 at the earliest and that the project would, rather,
be a “positive hindrance” to the war effort. The St. Lawrence Project
Conference pointed to the channel’s limitations, since only 30 percent of
worldwide tonnage, and 5 percent of U.S. shipping, could navigate the
seaway at the stipulated depth of twenty-seven feet.46
The St. Lawrence Seaway proposal intensified protests made by
southern industry in their fight over freight rates: Congress unfairly
spent American tax dollars to benefit the citizens, manufacturing, and
commerce of select areas, routinely neglecting the South and West.
Whereas beneficial commodity rates had mitigated the effects of freight
rate discrimination, no free- market mechanism could counteract the
Ibid.
45
Wiebe, Businessmen and Reform, 22–23. (“For National Defense?” undated article,
46
National St. Lawrence Project Conference, Washington, DC, published as a SSIC pam-
phlet, 12 August 1941, SSIC Papers Box 3, Folder 5.
0
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1
influence the seaway would have on the location of industry. Either the
seaway would exist, and threaten southern industry, or it would not.
Participants in the conference protested the proposal as unfair, declaring,
“Eighty-five percent of the cost of the project to the Federal government
would, in all probability, be paid by taxes collected from those living
in an area which will receive no benefits, and will even be damaged by
its construction.” Conference attendees protested that weather condi-
tions would limit the seaway’s operation in winter: for five months out
of the year it would be an “ice-way,” they charged. Seaway promoters,
they implied, used the war emergency to benefit privileged areas without
adding to the war effort. The project would produce no airplanes, guns,
or tanks. The uneven distribution of tax dollars to areas outside the
South, they maintained, while within the powers of Congress and the
Constitution, demonstrated the tendency of the national government to
disadvantage the southern economy in favor of northern industry. Such
arguments against the seaway highlighted the SSIC’s conviction that the
South would always fare poorly in federal intervention in the economy
and revealed the organization’s continued emphasis on the disadvan-
taged South.47
SSIC leaders walked a tenuous line in their approach to defense spend-
ing. They criticized the continuation of New Deal reforms in the con-
text of war, yet they also believed the South’s small and medium-sized
plants should receive “fair” shares of defense contracts in recognition
of the South’s lack of economic development. These points contradicted
other positions, such as the one on the seaway. SSIC president Thomas
Wallner criticized President Roosevelt for continuing to wage an “inter-
nal economic revolution” at the same time as he fought a “foreign war,”
complaining that the president believed “Come hell or high water … the
New Deal must go on.” To insist on receiving government expenditures
seemed to amount to asking the federal government to subsidize regional
development, but SSIC leaders disavowed such a position. SSIC activism
for war contracts instead resembled leaders’ earlier demands for equal
distribution of relief funds to the South, contradicting their recent pro-
tests against relief and regulation as damaging to free enterprise. SSIC
leaders continued to balance the needs of existing industries while pursu-
ing polices to promote industrial growth. They focused on using the war
to roll back the New Deal; their attachment to decade-old arguments
against the Roosevelt administration revealed the SSIC’s slow change in
Ibid.
47

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9
rhetoric –a shift that would not take significant hold until Thurman
Sensing became executive director.48
Moreover, the SSIC failed to make political headway or attract
allies who might aid their quest for more southern defense contracts.
Small plants, as Congress recognized early on in the acceleration of
defense production, received fewer than their fair share of contracts,
while also suffering from disruptions in supply of raw materials. SSIC
secretary C. C. Gilbert cited an industrial survey conducted by the
council’s research division that reported that more than 1,000 indus-
trial concerns in fifteen southern states faced closure or had already
closed their doors due to the inability of small plants to obtain con-
tracts. Although Congress also expressed concern about the problems
of small business and defense, particularly after the findings of a spe-
cial Senate commission headed by James Murray of Montana, the SSIC
remained dissatisfied with the distribution of contracts to small plants.
SSIC leaders criticized regulation, price controls, and wage and hour
policy rather than directing their animosity toward the large corpora-
tions that received the bulk of contracts. Large manufacturers existed in
the South, too, and SSIC leaders wanted to keep such generous donors
in the organization’s fold.49
In May 1942, the SSIC declared its intention to wage an “aggres-
sive and militant campaign” to “save Southern Industry from gradual
annihilation” as a result of rising challenges. While the New Deal had
alarmed southern industrialists, war production heightened their sense
that southern industry would be sacrificed to the war. Centralization,
combined with the political motivations of labor organizations and the
Democratic Party, further threatened to exacerbate industrial imbalances,
they warned. The war years convinced SSIC leaders that organized labor
had succeeded in “wresting control … of the conduct of the war away
from elected representatives,” and that the underlying ideology of free
enterprise and the profit motive would be thoroughly trounced under
the boots of war production practices. If southern workers proved more
efficient, they argued, then they should receive contracts by the rules of
Wallner to southern employers, 13 March 1942, SSIC Papers Box 4, Folder 1.

48
49 One newspaper dubbed the Aid to Small Business measure proposed by House and
Senate Committees a “spread-the-work-and-save-little-business-program” after the
first year of defense spending allocated 75 percent of supply contracts to only fifty-
six concerns. “31 Small Plants Win Arms Orders” New York Times, 22 October 1941.
“Sen. Murray Charges Defense Directors Slights Small Plants; Asks Funds for study,”
New York Times, 25 September 1941. Bean, Beyond the Broker State, 123–124.
2
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the free market, even if it meant granting contracts to plants without

unionized workers.50
The war posed organizational and rhetorical challenges for the SSIC.
The council’s leaders opted for a piecemeal approach to securing benefi-
cial arrangements; they did not develop a coherent public relations mes-
sage on southern opportunity, despite their previous calls to develop the
notion of the South as the “Nation’s Economic Opportunity No. 1.” Yet
the organization was changing. The SSIC lengthened its list of demands
and concerns, consolidating a list of grievances such as the mounting
national debt, inflation, and tax burdens. The war added to upward pres-
sures on southern wages: as labor migration increased and men enlisted
or were drafted in service, the labor pool continued to contract. In 1943,
the SSIC addressed its officers, directors, and members, declaring, “The
greatest single inflationary force now operating is the fantastic wages paid
in war plants.” Manufacturers also noted that war opportunities were
“luring workers away from the farms.” Even liberal southern representa-
tives, they argued, could see that labor organizations had wrested control
of defense manufacturing and the Democratic Party and demanded ever-
increasing wages. Another official SSIC statement read, “while Senator
Pepper (!) [sic.] and others have condemned the vocal labor leader John
L. Lewis’ defiance of the Government as sabotage bordering on treason,
the fact of the matter is that the present situation is the logical, natu-
ral, clearly foreseeable, and indeed well-nigh inevitable outgrowth of the
New Deal labor policy during the past ten years.”51
The council sought to unburden southern industry of New Deal
legislation, and defense mobilization lent another justification for this
Wallner to southern employers, 13 March 1942. Despite the efforts of state manufac-
50
turers associations, chambers of commerce, and trade associations, the SSIC argued that
greater effort was needed to ensure that “Southern industry, in its entirety, gets a square
deal.” SSIC to Industrialists of the South, 5 May 1942, SSIC Papers Box 4, Folder 1. SSIC
leaders argued that government involvement inherently distorted the free market, which
ran directly counter to their longtime foe Maury Maverick, who would again emerge as
a critic of the SSIC’s arguments when he was appointed in late 1943 as administrator
of the Smaller War Plants Corporation and declared, “free enterprise is preserved by the
government.” Maverick in Bean, Beyond the Broker State, 113.
SSIC to members, 6 May 1943, SSIC Papers Box 4, Folder 1. Lewis’s challenge to pro-
51
Roosevelt CIO leadership rattled business leaders. Lewis would be less willing to cede
union demands and to adhere to a no-strike pledge in favor of government or business
preferences for wartime labor management. By 1943, war production wages were high,
but labor leaders who hoped to use their support of war efforts to influence policy would
be disappointed, and the NWLB refused to set “uniform national pay standards,” except
in regionally divergent industries, such as textiles, thus drawing further ire from southern
manufacturers. Lichtenstein, Labor’s War at Home, 76, 82, 110–114.

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Attacking the Leviathan 193
purpose. SSIC leaders argued that in a time of war, decentralization and

relinquishing of federal control would increase the efficiency of defense
production and thus were a matter of patriotic duty. Although the SSIC
believed that the limitations imposed by the National War Labor Board,
the War Production Board, and the Office of Price Administration were
useful and necessary in wartime, the tendency of government since 1933
had been toward greater centralization and regimentation. SSIC lead-
ers predicted that if the council did not succeed in its efforts to slow
the accelerating pace of New Deal legislation, the result would be “the
destruction of the Middle Class” and outright confiscation of wealth.52
Attacking the Leviathan

For southern manufacturers, the war did not so much as define which
aspects of the New Deal they liked and disliked; rather, the conflict pro-
vided a new context with which to challenge reform. SSIC leaders used
the war to attack the New Deal, including the expansion of FLSA hour
regulations. Bureaucratic regulations, they argued, undermined the war
effort. Underneath these concerns for defense preparation were apprehen-
sions about the war’s impact on domestic manufacturing and the South’s
labor market. SSIC leaders and members feared that extensive federal
involvement in the economy along the lines already witnessed during the
New Deal meant that wartime controls would elevate the power of labor
Katznelson and colleagues argue that the war broke southern Democrats’ voting pat-
52
terns, resulting from the South’s weakness in a wartime economy that depended on large
capital and labor in addition to labor’s enhanced power amid labor shortages, and thus,
“In this more uncertain moment of rapid economic and central state expansion, the
South redrew the line between those aspects of the New Deal it would tolerate and
those it could not, and it rejected even those arrangements that had permitted the South
to vote with the national party in pre-1938 labor votes.” Southern manufacturers, with
long-standing antipathy toward unions and rising dissatisfaction under minimum wages,
had already begun to question the logic of southern political solidarity with the national
party. Katznelson et al., “Limiting Liberalism: The Southern Veto in Congress, 1933–
1950,” 23–24, 32; Tyre Taylor to SSIC members, 15 October 1943, SSIC Papers Box
4, Folder 2; SSIC Committee on Labor Relations, Report to the Board of Directors,
November 1944, SSIC Papers Box 4, Folder 3. Although defense mobilization would
not challenge the corporate order, as New Dealers intended, southern manufacturers
found the bargain struck between military planners and corporate providers not to their
advantage, even if “[t]‌he military services … were not part of the New Deal coalition,”
nor did they have an “agenda for displacing corporate prerogatives through their man-
agement of mobilization.” Brian Waddell, “Economic Mobilization for World War II and
the Transformation of the U.S. State,” Politics & Society, 22 (June 1994), 170. See also
Paul A. Koistinen, Arsenal of World War II: The Political Economy of American Warfare,
1940–1945 (Lawrence: University of Kansas Press, 2004).
4
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1
to dictate terms of employment with defense contractors. Furthermore,

SSIC public statements posited that the United States’ domestic indus-
try would be dramatically reshaped under Lend-Lease, as the program
to supply Great Britain and the Allied war effort increased demand for
industrial products. “In all probability,” an August 1940 SSIC Bulletin
read, “the defense program is only in its beginnings and the industrial
map of the United States may be substantially remade before another
disarmament conference is held.” Wartime corporatism, southern manu-
facturers feared, would not only enshrine aspects of the New Deal that
they despised but would further privilege large, non-southern firms at the
expense of smaller, regional ones.53
The New Deal, as southern manufacturers tried to paint it, was for
emergency economic conditions. With the implementation of Lend-Lease,
they argued, the emergency had shifted to war preparation. Additionally,
war, they hoped, would prompt policymakers to roll back reform while
also promoting the South as the nation’s no. 1 economic opportunity.
SSIC leaders understood that defense production would significantly
increase industrial activity, and they used war mobilization to highlight
oversight of regional advantages. Yet manufacturers had not yet fully
relinquished old arguments, particularly since human capital in the South
remained deficient, although they continued to leverage the South’s prob-
lems to attain political goals. Defense demands would strain facilities and
require additional skilled labor, labor that might not be readily available
in the South. Since “fairness” required even distribution of contracts, the
administration would, they hoped, be forced to capitulate on wages and
hours. In April 1941, SSIC leaders promoted an amendment to the FLSA
among southern congressional leaders to increase the forty-hour week
to forty-eight. Although wartime working hours in manufacturing jobs
increased an average of 7.1 per week, the law never changed to reflect
these increases.54
SSIC leaders considered their FLSA proposal an opportunity to rein-
vigorate support for the SSIC, which had flagged as wartime production
increased. As Nashville lawyer and SSIC counsel Charles L. Cornelius
told his associate, C. C. Gilbert, “If our Southern Congressmen were fully
acquainted with the benefits which would follow from [the forty-eight-
hour amendment] I think they would welcome the opportunity to lead
SSIC News Service, 15 August 1940, SSIC Papers Box 3, Folder 4.

53
54 David Roediger and Phillip Sheldon Foner, Our Own Time: A History of American
Labor and the Working Day (New York: Greenwood Press, 1989), 259.

5
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1
Attacking the Leviathan 195
the fight in Congress.” He continued, highlighting the public benefits:

“[T]‌heir efforts would not only receive nationwide publicity but in my
opinion would receive the plaudits of both industry and the rank and
file of the working class.” Workers could earn more per week, Cornelius
argued, and industry could counteract labor shortages. Such a movement,
he implied, would benefit the SSIC’s struggling bank accounts by renew-
ing members’ commitment to provide financial support.55
SSIC leaders criticized the FLSA’s central goal of enhancing produc-
tivity and consumption. Cornelius cited current events, arguing that
expanding the workweek to forty-eight hours would protect productivity
and allow for defense production to continue. A forty-hour week ham-
pered productivity, SSIC leaders argued, and thereby threatened defense.
While many industries could, in theory, implement shifts up to forty-eight
hours while paying overtime, depressed conditions meant that “the vast
majority are unable to do this, by reason of the increased cost,” Cornelius
wrote, adding, “Under the present conditions, the working of overtime
at a wage rate 1½ times that ordinarily in force is adding greatly to the
cost of National Defense.” Three years prior, SSIC leaders maintained, the
surplus of skilled workers called for such a limitation measure to put peo-
ple back to work. By 1941, circumstances had changed. Unemployment
decreased with defense production, Cornelius explained, and the crisis
shifted to the lack of available skilled workers. He posited that adding
eight hours to the work week would yield the same effects as a 20 percent
increase in the availability of trained workers. Such rule changes, SSIC
leaders’ logic went, would restore the natural flexibility of the economic
system. They wanted to prove their organization’s usefulness and demon-
strate that its Washington office provided unique services to the manu-
facturing sector. The SSIC had to show it could draw investment to the
region, but it also had to shield the region from further regulations to be
of use to existing manufacturers who funded the organization.56
Once the United States entered the war formally, the council argued
that allowing “free enterprise” to set wages in war industries was essential
for victory. SSIC representatives used the war to make their case against
further regulation, and, in particular, to push back against existing labor
legislation. In March 1942, SSIC president Thomas Wallner appeared
before the House Naval Affairs Committee to press his case for the forty-
eight-hour revision and a limitation on strikes in defense plants. Wallner,
Charles L. Cornelius to Gilbert, 11 April 1941, SSIC Papers Box 3, Folder 2.

55
Ibid.
56
6
9
1
addressing the committee, accused strikers at plants with naval contracts

of working against the life-and-death struggle of the war. He asked the
committee to recall Navy representatives’ testimony that 4,000 workers
were currently on strike in plants with naval contracts and that, since
Pearl Harbor, naval production had lost more than 70,000 man-hours to
strikes. He challenged the Committee, asking, “Does that look to you like
a contribution to Victory? It doesn’t to me or to those for whom I speak.
It looks more like France –politics as usual –like dangerous compla-
cency, or worse, in high places.”57
Building on this rhetoric, Wallner and SSIC leaders used the war to
recast their antipathy toward reform as patriotically motivated. They
portrayed national security as another sacrificial lamb on the altar of
reform. Wallner concluded, “What we need now is a great release of the
nation’s energies; not restraints, whether by unreasonable ceilings over
hours, requirements that workers must pay tribute to some private orga-
nization for the right to work; or by any other means.” Wallner empha-
sized rights-based language to make his case and portrayed industry as
dangerously limited by regulations in pursuing mobilization. “We have
really been trying to fight this war with one hand tied behind our back,”
he declared, “and wars are not, never were, and never can be won that
way.” In painting wartime mobilization as threatened by labor disputes
and political maneuvering, Wallner strategized that he could make a case
for craven motivations on the part of the administration. By Wallner’s
definition, the Roosevelt administration’s defense-mobilization plan con-
tinued the Democratic Party’s same “spend and spend and elect and elect”
priorities that had hampered recovery and placed unnecessary burdens
on the growth of industry in the South. But translating these criticisms
into political power and policy remained unrealized.58
Making Political Hay in Wartime

SSIC leaders sought to make political progress by seeming to speak for
the de-politicization of industrial policy. Industry was the linchpin of
the war effort, SSIC leaders argued, and too many politically motivated
57 Statement of Thomas J. Wallner, President, Southern States Industrial Council, Before the
House Naval Affairs Committee, 24 March 1941. Reproduced by the SSIC, SSIC Papers
Box 4, Folder 1.
Ibid. See also, Hearings Before the Committee on Naval Affairs of the House of
58
Representatives on Sundry Legislation Affecting the Naval Establishment, 1941–[1942],

Volume 1, Issues 1–89 (Washington, D.C.: GPO, 1942).

7
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1
Making Political Hay in Wartime 197
forces threatened the delicate balance manufacturers achieved, such as

with the freight rate revision. The SSIC depicted industrial managers
in wartime having to achieve a precarious balance regarding material
demands, governmental regulation, and technological change amid ris-
ing wartime production needs. Meanwhile, SSIC leaders argued, labor
bosses and bureaucrats pulled the industrial manager in several direc-
tions, taxes threatened profitability, and “Brain Trusters” continued to
seek social improvement. SSIC leaders insisted that labor unions’ political
motivations, along with capitulation from a Roosevelt administration,
threatened national priorities. While bureaucrats and labor bosses reaped
all the benefits, industrial managers encountered increasing regulations,
material shortages, and responsibility for employees. If the system, SSIC
leaders argued, restored adequate power to the industrial sector and let
manufacturers cooperate free of burdensome regulations, eventually their
freedom would benefit all.59
Despite southern strength in Congress, consistent political representa-
tion for their positions proved difficult for the SSIC to cultivate. Senator
Byrd, a reliable conservative ally, suggested that U.S. military defeats could
be blamed on work hour ceilings. Congressional support for the work
week revision remained sparse, however, and attention to the plight of
small business would come only later in the war years. Southern gover-
nors, although generally conservative and in favor of promoting industrial
development, pursued a position counter to the recommendations of the
SSIC in the matter of freight rates. The issue’s complexity and general inac-
cessibility to the general public stymied the SSIC’s ability to wage a public
relations effort to pressure the governors and congressional representatives
to back off uniform equalization. Rising conservatism in Congress offered
hope for southern manufacturers, but not to the extent that they desired.60
Although the SSIC remained officially nonpartisan, private conversa-
tions suggested that many leaders had already abandoned the Democratic
Party. One prominent representative gave both public and private voice
to these sentiments. James Stahlman, publisher of the Nashville Banner
59 “Too Much Cooperation,” Cartoon, January 1943, reproduced by the SSIC, SSIC Papers
Box 4, Folder 2.
Roediger and Foner, Our Own Time, 259. In 1944, the Senate appointed a Special
60
Committee to conduct hearings on the problems of small business. “Problems of

American Small Business,” testimony before Small Business in the Changing War
Program: Hearings Before the United States Senate Special Committee to Study and
Survey Problems of American Small Business Enterprises, Subcommittee on Complaints,
78th Congress, 2nd Sess., 3 May 1944. (Washington, DC: USGPO, 1944).
8
9
1
and an avid SSIC supporter, abandoned FDR in 1936 and reluctantly

supported Wendell Willkie in 1940. Stahlman consistently searched for
the most conservative candidate. Willkie, by 1942, also disappointed
Stahlman –along with other conservatives and Republicans –with his
liberal positions. Writing while Willkie was visiting Russia and China
as Roosevelt’s “personal representative,” Stahlman criticized Willkie’s
internationalism and support of FDR. Stahlman expressed his disgust
with both Willkie and New Deal liberalism to Banner editor Alvand
Dunkleberger. He told Dunkleberger that Willkie “is trying to be an
ultra, ultra liberal and is outdoing even the New Deal.” He blustered,
“The next time Willkie opens his bazoo let him have one right between
the eyes.” The Banner’s conservative editorial position voiced similar
points of view offered by prominent southern figures such as Stahlman’s
friends in the SSIC. These elite southerners chafed at the direction of the
national Democratic Party, but they found few friends in the GOP. If the
Democrats had been co-opted by organized labor, southern manufactur-
ers and their allies argued, the Republicans maintained their own New
Deal–like ideas and could likewise not be trusted to pursue conservative
principles. Southern conservatives would watch with interest as the GOP
drifted rightward in the coming years, but it was not yet a vehicle for
their anti–New Deal positions.61
The feeling was mutual in the GOP. Not only were many Republicans
critical of the South’s violations of African Americans’ civil rights, but
party leaders did not see southern manufacturers as a constituency they
could cultivate. The Republican Party’s presence in the South varied from
state to state, with stronger support in border states and an almost non-
existent presence in the Deep South. GOP staffers noted that industri-
alists seeking favors would gain more from access to senior members
of Congress, who tended to be from the South, and that manufacturers
favored those in power only as it helped their interests. Manufacturers
seemed to be fair-weather friends, not reliable supporters. Jake Newell,
chairman of the North Carolina State Executive Committee, which fielded
GOP senate candidates more often than did any other state committee,
wrote Republican National Committee Chairman Joseph W. Martin Jr.
and illustrated this perspective. “Since the South started on an industrial
career,” he wrote, “a new combination of faces has appeared in our midst.
It is composed of some of those who have in the past fattened at the
Federal pie counter and desire to feed again, and some of those who have
Stahlman to Alvand Dunkleberger, 9 October 1942, Stahlman Papers, VIII, 6.

61

91
Making Political Hay in Wartime 199
come into North Carolina seeking advantage of the opportunities they

believe exist here.” These grasping individuals either wanted to keep the
party small enough to control it or went to Washington “seeking favors
for themselves, or ladling out patronage to themselves or their favor-
ites,” and neither group, he declared, was “worth a damn” to the GOP.
“Real” Republicans in the state would not accept leadership if it came
from manufacturers.62
But Republicans were not to blame for the South’s woes –that charge
southern industrialists placed at the feet of the region’s one-party sys-
tem, and they fantasized about building a second party. The chumminess
between the Democratic Party and the labor movement, they argued, was
the fault of the South’s own southern representatives. SSIC official state-
ments declared, “It is a fact that without the steady and undeviating sup-
port of the ‘Solid South,’ [labor policy] could never have been sustained
through successive presidential elections.” The New Deal would soon
be a permanent fact, one SSIC dispatch cautioned. If the few allies left
in Congress “fail to get necessary corrective legislation now,” the warn-
ing continued, “it will be because certain of our Southern Senators and
Representatives continue on this issue to adhere to the New Deal-Labor
party line.” Legislation permitting “labor dictatorships” needed revision,
SSIC leaders argued. They proposed outlawing strikes during wartime
and instituting antiracketeering measures, suspending mandatory over-
time up to forty-eight hours, and prohibiting the unionization of super-
visory employees. The war produced an organization centered on labor
reform. Its leadership equated the New Deal’s consequences with John
L. Lewis’s wartime strikes.63
While the SSIC turned its attention to more national matters of labor
legislation without specific reference to defense of the South, other
southerners were coming to share their anti–New Deal position. John
Temple Graves II, the sometimes critic and sometimes supporter of the
SSIC, declared in his 1943 book on the South’s contributions to the war
effort that he no longer considered himself a New Dealer. He wrote that
he was formerly “one of the Woodrow Wilson half who believed that
62 Jake F. Newell to Joseph W. Martin, Jr., 23 July 1941, Joseph Martin Papers, Stonehill
College, North Easton, MA, Box 16, Folder 8.
SSIC to officers, directors, and 3,200 members, 6 May 1943, SSIC Papers Box 4,
63
Folder 1. For history of BAWI, see Cobb, The Selling of the South. “Southern Vote for
Republican Candidates for U.S. Senate, 1914–1960,” in Richard K. Scher, Politics in the
New South: Republicanism, Race, and Leadership in the Twentieth Century, 2nd ed.
(Armonk, NY: M. E. Sharpe, 1996), 126. Regional blue-collar wage differentials per-
sisted through the 1970s. Wright, Old South, New South, 263.
02
the physical science which was bringing men closer together, making the
world and its states smaller and smaller, calling for mass consuming to
market its indispensable mass production –needed a strongly umpir-
ing government.” Given that assumption, he wrote, “I looked upon the
Roosevelt Revolution as a thing necessary … even if a little of the liberty
had to be lost. Without a new deal, I thought, the free enterprise system
in America could not survive.” He felt that with the war, it was time for
the revolution to end. Graves declared he agreed with those who sought
to “put the Dealers out.”64
The national attention paid to the South in the late-1930s, though
negative, unified several disparate groups seeking to uplift the region. The
war augmented these developments. Graves noted, “The South came to
war in 1941 more aware of itself as a region than it had been since 1861.
A major item of awareness, happily was of its sins. It was confessing to
bigotry, neglect, injustice, and sloth. But another item was a conviction
of discrimination, old and new.” In the South as the rest of the coun-
try, incomes rose, women entered the workforce in greater numbers, and
labor experienced greater mobility. The war signaled the centrality of the
maintenance of low wages to the South’s economic development, as SSIC
leaders envisioned it. Perceived discrimination in tariffs and freight rates,
or in the distribution of relief dollars, united southerners and turned their
attentions toward the region’s ills. “Discrimination” in defense contracts
and the limitations facing small and medium-sized manufacturers deep-
ened their antipathy toward liberal Democrats, labor unions, and the
New Deal.65
Conclusion
Advocating for defense contract distribution in the South complicated
the SSIC’s preference for a hands-off federal government, but war pro-
duction complaints added to leaders’ notions that federal involvement
in the economy would inevitably damage the region. Southern gover-
nors had taken southern defensiveness in the freight rate matter too
far, in their opinion. The SGA abandoned economic rationality and the
needs of existing industry and allowed Congress to meddle in southern
affairs. SSIC leaders adopted free enterprise in limited quantities and in
specific applications, such as to protect established southern industries.
John Graves, The Fighting South (New York: G.P. Putnam’s Sons, 1943), 115.

64
Ibid., 58.
65

1
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2
Conclusion 201
Free enterprise, in early SSIC use, did not convey underlying economic
principle. The SSIC, in its advocacy for southern war contracts, remained
a decidedly southern organization. Still, a subtle and important shift
occurred among its leadership, particularly in their embrace of antistatist
rhetoric.
While the SSIC continued to represent established southern industry,
particularly commodities-intensive sectors, it equated the preservation of
southern interests and free markets with national ideals. If localism and
free markets reigned, then all their previous concerns about preserving
southern traditions would become moot. Each state and region would be
allowed to determine its own affairs, including the setting of freight rates.
The federal government would distribute largesse, when necessary –such as
during wartime, to build a temporary military arsenal –without attempting
to engineer social results. Even as the more aggressive economic planners
and antimonopolists of the New Deal, such as Rexford Tugwell, exerted
less influence on national policy, free-market conservatives condemned fis-
cal policy and the expansion of the welfare state. Crafting a movement that
spoke both to regional defenders and across isolationist and internationalist
lines proved difficult.66
Nevertheless, during the war years SSIC leaders focused more on pub-
lic relations, particularly with the 1943 addition of youthful, energetic
leadership. Thurman Sensing articulated this new public relations pur-
pose for the SSIC, and he linked it to emerging conservative economic
thought. Although unsuccessful in the freight rate case, the arguments
developed in response to national class rate equalization would provide
a powerful basis for future conservative intellectual and organizational
cooperation. The extension of New Deal regulations during the war pre-
sented another arsenal of policy experiences to bolster their conservative
arguments. With time, SSIC leaders would reorient their regional defen-
siveness toward a national purpose: in the late 1940s and early 1950s,
they would remarket the South as the “bulwark of democracy,” a repos-
itory of the nation’s core values, around which a conservative movement
could coalesce.67
Brinkley, The End of Reform, 267.

66
67 In 1936, James Stahlman referred to the South as a “bulwark against all efforts to break
down those things which are so fundamental in our national life,” but at that time he
lamented the South’s weakness. The SSIC would reinvigorate the bulwark idea as con-
servative allies emerged, when the South no longer “succumbed to the siren song of
patronage and the dulcet voice over the radio.” Stahlman to Robert L. Garner, 25 July
1936, Stahlman Papers VII-1.
2
0
The South as the “Bulwark of Democracy”
In January 1947, SSIC Director of Public Relations Thurman Sensing

announced that Indiana had joined the South. The Indiana House of
Representatives, led by a Republican majority, had recently passed a res-
olution declaring, “states which elect not to participate in grants-in-aid
programs may receive the money they would have received had they taken
part.” In other words, Indiana demanded return of federal taxes paid by its
residents so the funds would not be redistributed to other “needy” states.
Sensing lauded Indianans for seeing “the fallacy and danger of relinquish-
ing control to the central government [of] powers which the Constitution
retained to the States.” Indiana representatives sought to prevent local
incomes from being drained to the poorer South, but Sensing ignored this
fact and declared that Indiana’s stance against subsidies meant the state
could now be considered “southern” –a status he considered an honor.
Any state rejecting federal largesse could claim the southern mantle.1
By 1947, a coherent, ideological depiction of the southern economy
emerged from SSIC leaders. “We are fed up with subsidies, doles and
1 Thurman Sensing, “Indiana Joins the South,” “Down South” 20 April 1947, SSIC Papers
Box 5, Folder 3. According to one local newspaper, in defending votes like that of the
Indiana House, Rep. Clare Hoffman of Michigan told Speaker Rayburn that Midwestern
Republicans “will get along all right when they get off their shoulders the burden of
taxes to support you people in the South.” “Hoosier Voice is Heard,” 20 February 1947,
Tipton Daily Tribune, Tipton, Indiana. Conservatives would continue to laud the deci-
sion, including FEE president Lawrence Reed, who declared that the country would be
on better footing in 2009 if it had followed Indiana’s lead in 1947. Lawrence Reed, “A
Trillion Wrongs Don’t Make a Right” 17 February 2009, www.fee.org/publications/
detail/a-trillion-wrongs-dont-make-a-right. In April 1947, however, Indiana’s governor
appealed to the federal government for flood aid.
202

3
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2
The South as the “Bulwark of Democracy” 203
paternalism,” Sensing declared. “We are no one’s stepchild. We have

grown up.” Sensing rejected the SSIC’s previous reliance on the South’s
“infant” status. His “South” became an ideological rather than historic or
geographic construction. This new southern identity took shape slowly,
invoked only in particular policy conversations and with specific political
allies. Yet this redefined identity would yield, by the late 1940s, a modern
conservative organization committed to branding the South as a haven
for free enterprise. SSIC leaders subsumed their cultural and social predi-
lections under the color-blind mantle of free enterprise2
Four contemporary developments illustrate the southern manufactur-
ers’ growing commitment to free enterprise and the SSIC’s quest for a
conservative political realignment: the debates over bills for a perma-
nent Fair Employment Practices Commission, a recurring proposal to
extend wartime oversight of equality in hiring among government con-
tractors into peacetime; SSIC leaders’ attempts to rebrand the south-
ern economy; the CIO’s Operation Dixie and the passage of the Labor
Management Relations Act of 1947 (Taft-Hartley); and the SSIC’s efforts
to recapture the Democratic Party in 1944, when members sought to
draft their conservative ally, Senator Harry Byrd, and –four years later –
when Strom Thurmond launched his bid for president under the States’
Rights Democratic Party. These episodes reveal the contested emergence
of free enterprise as a uniting force on the right. The SSIC had to con-
vince southern manufacturers that an ideological turn would successfully
defend existing industries while also promoting policies that would help
the region’s economy grow without sacrificing southern “civilization.” To
do that, SSIC leaders sought a delicate balance as they pursued members
who demanded that the organization persuade Congress to dismantle
New Deal regulations and defend segregation as well as protect mem-
bers’ specific interests, such as blocking federalization of tideland oil or
preserving the South’s labor market. As traditional invocations of south-
ern identity and protectionism failed, manufacturers turned increasingly
to free enterprise.
Meanwhile, the federal minimum wage, farm subsidies, and mechani-
zation chipped away at the region’s agricultural arrangements and labor
market. Southern industry as a whole, not just defense-related manu-
facturing, transitioned toward new markets and adapted to a changing
labor pool. Southern industrialists’ management practices increasingly
resembled national ones. If the New Deal offered a sea change in policy
2 Sensing, “Indiana Joins the South.”

4
0
2
204 The South as the “Bulwark of Democracy”
that reoriented southern business leaders politically, the postwar years

unleashed transformations in the southern economy that further destabi-
lized notions of regional identity and economic interest.3
In the late 1940s, the priorities that informed free enterprise –free
markets, low levels of regulation, the ability for localities to compete
for investment –replaced mill village paternalism and underdevelopment
as the SSIC’s justifications for opposing economic reforms, regulations,
and federal intervention. Free enterprise rhetoric itself was not an agent
of moderation, as SSIC leaders’ anti–civil rights activism –undertaken
outside of their official positions in the council –demonstrated. But the
rhetoric’s adoption revealed southern manufacturers’ practical responses
to a changing political and social environment, their desire to preserve
the South’s economic reputation, and the political aspirations of the SSIC.
In this reformulation of southern exceptionalism, what was good for the
South was good for the nation.4
Defending Localism: FEPC and Civil Rights

The SSIC, by the mid-1940s, had grown significantly and established a
solid base of support among southern manufacturers. The war years saw
3 Toby Moore explains that in cotton textiles, the post–World War II era “ushered the
industry and its workers from an avowedly southern form of welfare capitalism to a
lukewarm variant of the Fordism of the rest of the country.” Toby Moore, “Dismantling
the South’s Cotton Mill Village System” in Scranton, The Second Wave, 115. Gavin
Wright notes, the abolition of the South’s low-wage market via New Deal policies meant
that the southern political and economic leadership “no longer had strong interests in
regional isolation from outside labor and capital markets.” Wright, Old South, New
South, 238. The breakup of the cotton sharecropping system undermined the South’s
isolated labor market, allowing political and economic transformation and for the rev-
olutions of the civil rights movement to take hold with the power of rural white elites
destabilized. Nancy MacLean, “From the Benighted South to the Sunbelt,” in Harvard
Sitkoff, ed., Perspectives on Modern America: Making Sense of the Twentieth Century
(New York: Oxford University Press, 2001), 218.
4 As James Cobb notes, “Henry Grady and the early twentieth century boosters who fol-
lowed his lead experienced little difficulty in crusading for industrial development while
extolling the merits of white supremacy. After World War II, however, mounting civil rights
pressures complicated efforts to pursue economic growth. As the postwar apostles of
industrial expansion came under increasing critical national scrutiny, they seemed to con-
front at last the oft-postponed decision between emotional attachments to yesterday and
grand ambitions for tomorrow.” James C. Cobb, “Yesterday’s Liberalism: Birmingham
Business Leaders and Desegregation, 1950–1963” in Elizabeth Jacoway and David R.
Colburn, eds., Southern Businessmen and Desegregation (Baton Rouge: Louisiana State
University Press, 1982), 151; Michael Bowen, The Roots of Modern Conservatism: Dewey,
Taft, and the Battle for the Soul of the Republican Party (Chapel Hill: University of North
Carolina Press, 2011), 180.

5
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2
Defending Localism: FEPC and Civil Rights 205
an increase in regular donors, from an average of 1,100 regular, annual

donors before the war to 1,500 during the war. This occurred despite the
organization’s troubles with securing adequate leadership. Before Thurman
Sensing directed SSIC public relations, the first man in the role exhibited
public drunkenness and caused some embarrassment for the organization.
The wartime growth in donors did not carry forward. Decline in financial
support stemmed from a confusing postwar political environment in which
the SSIC attempted to rebrand itself. The continuation of the New Deal
during the war, and particularly a wartime measure to enforce equality in
hiring on federal defense contracts, exacerbated southern manufacturers’
fears of federal intervention in the South’s economy and culture.5
The FEPC embodied SSIC leaders’ prior concerns about liberal-
orchestrated “meddlesome” federal wage and price controls, bureaucrati-
zation, and centralization, all of which interfered with local “customs.” The
FEPC fit neatly within the SSIC’s increasingly ideological narrative about
bureaucratic excess that violated the freedom of employers and local affairs.
Yet as the SSIC’s activism against congressional and presidential efforts to
enact a robust, permanent FEPC reveals, the language of free enterprise
permeated manufacturers’ arguments slowly and only on select policy
questions. Political expediency demanded that SSIC leaders still rely on the
idea that the South suffered unduly at the hands of bureaucrats. They used
the argument to solidify relationships with southern Democrats. Yet, after
the war, when business capitalized on its revitalized reputation and Cold
War tensions contributed to a conservative resurgence, SSIC leaders would
adopt revised, color-blind rhetoric regarding the FEPC that complemented
the emerging business and conservative crusade to roll back the New Deal.6
5 SSIC Account Books, 1941–1947, SSIC. The SSIC retained the services of North Carolina
attorney and former member of the State House of Representatives for Caldwell County,
Percy W. Meekins, to head up public relations activities in January 1945. By January
1946, the Washington office registered concerns that Meekins “had acquired a drinking
habit, and that for the past several weeks his conduct had been such that he thought it
best to let Mr. Meekins go.” Executive Committee Minutes, 29 January 1946, SSIC Papers
Box 6, Folder 1.
6 The paradoxes in the SSIC’s positions on right-to-work laws and FEPC resembled the ten-
sions that Friedrich Hayek argued existed between “true liberalism” and conservatism. In
1956 he wrote, “A conservative movement, by its very nature, is bound to be a defender of
established privilege and to lean on the power of government for the protection of privi-
lege. The essence of the liberal position, however, is the denial of all privilege, if privilege is
understood in its proper and original meaning of the state granting and protecting rights
to some which are not available to others.” The SSIC attacked the “privileging” of labor
by government policy, yet leaders mobilized to protect elite manufacturers’ power to set
wages by enacting laws for their protection. “Foreword to the 1956 American Paperback
6
0
2
The FEPC originated in Franklin Roosevelt’s Executive Order #8802

in 1941, which banned hiring discrimination by defense contractors. The
president charged the FEPC with overseeing compliance with the order.
The first commission lacked sufficient means of enforcement and suffered
from scant staffing and funding. President Roosevelt strengthened the
FEPC in 1943, requiring that all government contracts include a non-
discrimination clause. Labor and civil rights leader A. Phillip Randolph,
whose activism had spurred Roosevelt to enact the wartime measure,
pressured the Truman administration to extend and strengthen the FEPC
in peacetime. Truman’s National Council for a Permanent FEPC thus
campaigned during Congress’s 1945– 1946 session for a compulsory
FEPC, which would enable the body to issue cease-and-desist orders
to employers. The Rules Committee failed to produce a bill for a vote,
but more groups were calling for attention to unequal hiring of African
Americans. Although Truman allowed the order to expire, the issue pro-
voked a strong response from southern business leaders.7
SSIC leaders offered scattershot and sometimes contradictory argu-
ments to oppose the FEPC’s extension. In 1944, Thurman Sensing equated
the FEPC to New Deal administrations that damaged southern employers
and their rights. He blithely sidestepped the issue of hiring discrimination
as either not widespread or, paradoxically, as being in the best interest of
blacks. In the same way that opponents to antilynching legislation dismissed
mob violence as the work of a few bad seeds, while implying that organized
crime pervaded northern cities, southern employers wished to block the
FEPC as misplaced given government’s proper roles and the nation’s other
problems. Sensing dismissed the proposal as one of many futile attempts
to alter racial attitudes among white southerners, though he tried to assert
that southerners cared about the “general prosperity of the Negro race.”
Above all, Sensing resented the enforcement mechanisms proposed in the
bill for a permanent FEPC that Congress considered during 1945.8
Edition” in Friedrich A. Hayek, The Road to Serfdom: Text and Documents, ed. Bruce
Caldwell (Chicago: University of Chicago Press, 2007), 46.
7 Michael Klarman, From Jim Crow to Civil Rights: The Supreme Court and the Struggle
for Racial Equality (New York: Oxford University Press, 2004), 185. A. Phillip Randolph’s
personal support for socialism and his call for a march on Washington inflamed southern
industrialists’ feelings about the FEPC, and they charged that the bill, like the original
executive order, was a mere political stunt to curry support for the president from specific
interest groups.
8 Thurman Sensing to Officers and Directors, 17 March 1944, SSIC Papers Box 4, Folder 3.
Thurman Sensing, “The FEPC is Purely Political” News Bulletin, No. 152, 1 January 1952,
SSIC Papers Box 1, Folder 2 [repeated title of a press release from November 1949].

7
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2
H. R. 2232, the bill for a permanent FEPC, emerged from Truman’s

Committee on Fair Employment Practice. The proposal empowered the
commission to issue “affirmative action and cease and desist orders.”
Employers would have had to challenge rulings against their hiring prac-
tices in the Circuit Court of Appeals. Southern manufacturers supplied a
range of arguments to stop the bill. Some opponents declared that they
approved of the prevention of discrimination but objected to the enforce-
ment mechanism. Such tepid support for equality in hiring was a cynical
use of the idea of “fairness.” SSIC member B. O. Cone of the Crawford
Manufacturing Company in Richmond, Virginia, told South Carolina
Senator Olin Johnston, “I believe in ‘Fair Employment Practices’,” but
he entreated the senator to vote against the bill and trust that manufac-
turers would uphold national ideals. With the war emergency ended, he
wanted to roll back federal oversight of the economy. Cone protested
the extension of a broad range of wartime regulations, such as the FEPC
and the OPA, into peacetime. Other southern manufacturers agreed. One
Birmingham SSIC donor explained that citizens “tolerated [bureaus] as a
war necessity and without honest complaint, but government by bureaus
is not the democratic way.”9
Regarding the FEPC, the SSIC built opposition to the commission’s
permanence by appealing to white racial solidarity and hostility to
bureaucratic growth, cobbling together an unwieldy coalition. Southern
politicians responded to segregationist arguments against the law,
which they feared would undermine white supremacy; non- southern
Republicans such as Robert Taft supported the arguments about bureau-
cratic overreach. SSIC leaders focused on wooing the former group by
appealing to their shared identity and racial solidarity.
The 1945 bill to establish a strong, permanent FEPC united opponents
of racial equality, though they differed on other aspects of the Democratic
Party’s agenda. The FEPC proposal, SSIC leaders hoped, would convince
southern politicians of the dangers of the New Deal. Sensing concluded
that the “ ‘Solid South’ complex has cancelled the effectiveness of the
9 A. Bruce Hunt, “The Proposed Fair Employment Practice Act; Facts and Fallacies,”
Virginia Law Review, 32 (December 1945): 3. B. O. Cone to Olin Johnston, 27 March
1945, Olin Johnston Papers, University of South Carolina, Box 7; L. W. Morgan to Lister
Hill, 5 July 1945, Lister Hill Papers, Box 140, Folder 26. Jason Morgan Ward discusses
the SSIC’s attempts to unite southern elites against the 1945 proposal in light of the war’s
ideological battle for democracy and that the proposal “presented an opportunity to rec-
oncile the segregationist position with a more transcendent rhetoric of individual liberty.”
Ward, Defending White Democracy, 78, 82.
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2
Southern vote and now that we have occasion to stand up and defend
certain principles and ideals that should be called ‘American’ and cer-
tainly can be called ‘Southern’, we find our selves with few ‘friends in
court.’ ” Southern representatives, he charged, had to defeat the bill, even
though many had sold their souls to the New Deal coalition. Given this
context, SSIC members appealed to southern representatives on the basis
of southern, not American, solidarity. Despite resenting Lister Hill’s lib-
eral positions, an SSIC donor told the Alabama senator, “You have done
a service to your constituency and to the entire South” in blocking a per-
manent FEPC. Manufacturers’ letters to the segregationist senator often
invoked ideas about racial hierarchy and fears of “social inter-mingling,”
knowing that Hill might not be amenable to arguments that the FEPC
was as odious as the New Deal.10
In approaching liberals, some southern industrialists made antibu-
reaucratic arguments, but they understood that this approach was not the
key to Hill’s and others’ support. Southern politicians’ cooperation with
employers stemmed, rather, from similar views on race and a common
desire to avoid outbreaks of violence for the sake of economic prosperity,
if not for black victims. Even supporters of civil rights, such as North
Carolina’s Frank Porter Graham, avoided endorsing the FEPC to prevent
violent white backlash. Graham and racial moderates in the South pre-
ferred a gradualist approach to addressing inequality and dismantling of
segregation.11
While most southern Democrats in 1945 based their FEPC opposi-
tion on white supremacy and in defense of segregation, SSIC leaders
hoped to use the bill to win converts to southern manufacturers’ long-
standing allegations of bureaucratic overreach. Rush Cole, Monsanto
vice president and president of the SSIC at the time, wrote to all south-
ern congressional leaders: “The people of the South, who are certainly
the best friends the Negro has, are terribly disturbed over this proposed
10 R. R. Cole to Olin Johnson, with enclosure, 30 March 30 1945. Olin S. Johnson Papers,
Labor, Fair Employment Practices, folder 2 of 4, 1945; Benjamin J. Davis, Jr., “FDR
Crusades for a Permanent FEPC,” Daily Worker, 31 October 1944, UAW Research Files,
Box 11, Folder 17; Leo Karpeles to Lister Hill, 23 May 1945; W. S. Edwards, Jr. to Lister
Hill, 17 May 1945. Opponents also differentiated the quality of white versus black labor.
A Birmingham car dealer argued that black workers were less valuable, writing, “I cer-
tainly do not want to have to employ colored employees for jobs that can be much more
efficiently filled by white people,” and he continued, “neither do my employees want to
be associated with the colored employees.” M. M. Argo to Lister Hill, 26 March 1945,
Lister Hill Papers, Box 140, Folder 24.
J. E. Smith to Lister Hill, 5 June 1945; G. F. Browning, Jr. to Lister Hill, 16 May 1945,
11
Lister Hill Papers, Box 140, Folder 24.

9
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2
legislation. They have the definite conviction that any such action 7
should be left to the individual states.” The law also would “stir up racial
dissension,” Cole charged, a common warning from segregationists.
SSIC leaders again issued charges of southern “discrimination,” paint-
ing the FEPC as another ploy by jealous economic competitors to cast
the South in a negative light and limit the region’s ability to compete in
a free economic arena. SSIC leaders returned to traditional arguments
honed during a decade of activism against the New Deal to block a per-
manent FEPC.12
A congressional conservative coalition blocked the bill. This alli-
ance agreed that the FEPC, as SSIC leaders put it, violated the rights of
employers in making hiring decisions. Business associations from across
the South echoed such sentiments, including lumber trade associations,
grocers’ associations, the Alabama Food Council, and local and state-
level chambers of commerce. Support was forthcoming from the con-
servative wing of the GOP, as well. Although he approved of the idea of
improving equality in hiring, Republican Senator Robert Taft of Ohio
also resisted attempts to strengthen the enforcement mechanisms of the
bill on the grounds that the FEPC violated states’ rights and carried the
powers of government too far.13
Yet the political context and southern manufacturers’ segregationism
limited the SSIC’s ability to create a wider network of allies. Even though
the FEPC failed, southern manufacturers realized that they needed more,
and more consistent, allies. The SSIC’s central office sent out thousands
of leaflets on the topic. On top of the 2,900 letters sent to organizations
asking for opposition to the bill, Tyre Taylor, the SSIC’s general counsel,
contacted 130 business interests personally. The SSIC and other busi-
ness organizations promoted a southern filibuster of the bill in 1945.
Nevertheless, the bill’s southern opponents made few organizational
12 Rush Cole to Olin Johnston, 20 March 1945; J. C. Self to Olin Johnston, 17 March
1945, Olin Johnston Papers, Box 7; Gilbert to SSIC contributor, 19 May 1945, SSIC
For more examples of reactions to the law in its various iterations, see folders on FEPC
13
in Boxes 3, 7, 22. Lister Hill’s papers contain numerous statements and resolutions by
Alabama trade associations. Some support for the bill does appear, mostly from the state’s
NAACP chapter and Birmingham Council for a Permanent Fair Employment Practice
Committee, whose board of directors included several NAACP leaders. See Lister Hill
Papers, Box 140, Folders 23–25. For Taft’s efforts to promote a noncompulsory FEPC, as
well as his concerns about the 1945 bill, Timothy N. Thurber, Republicans and Race: The
GOP’s Frayed Relationship with African Americans, 1945–1974 (Lawrence: University
Press of Kansas, 2013), 9–10.
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links with allies outside of the South. This was despite similar reliance on
constitutional arguments by Senator Taft.
Southern manufacturers’ responses to the FEPC, although they con-
tained constitutional arguments similar to those voiced by congressio-
nal conservatives, maintained a distinctively southern character. Charles
Long, president of the Long-Lewis Hardware Company and longtime
SSIC donor, criticized the establishment of “a wide spread peace time
bureaucracy” that existed only to “protect the schemes of shysterism and
black-mail.” Moreover, he continued, “It would also pull down all of our
efforts to preserve free enterprise and the right of employers to use their
own sound judgment in selecting loyal and capable employees.” He pro-
tested that strikes and “race troubles” would “evolve from [the FEPC’s]
enforcement” and the FEPC would never accomplish its intended goals.
Although Long’s statements reflected the growing dissemination of free
enterprise rhetoric to confront the New Deal’s continuation and prevent
federal intervention in the South’s system of segregation, few others made
similar links between FEPC and free markets. As SSIC reactions to the
FEPC demonstrated, the shedding of sectionalist language and positions
proved to be a halting process. The complicating fact was that racial
solidarity remained the strongest link between anti–New Deal manufac-
turers and their representatives in Congress.14
The 1945 FEPC proposal convinced SSIC leaders that an explic-
itly southern defense against federal interference must be maintained
because their sway with southern congressional leaders depended on
being in lockstep regarding white supremacy. In 1946, newly elected
SSIC president Remmie Arnold declared that southerners alone had
experience and wisdom in regionally appropriate employment practices,
and that property rights –of both employers and employees –meant
nothing to the FEPC administrators. Southern experience, in his opinion,
justified racially based employment practices, just as a sense of unique
southern labor conditions supposedly fostered opposition to the Wagner
Act. Referring to a bill to establish a permanent FEPC, Arnold stated,
“We of the South have been severely criticized for our opposition to
this measure. We have passed through experiences in the past which
give us knowledge of bureau control never known by other sections of
the country, and God willing, we will never lend our aid to the creation
of such a monstrosity as this bill would establish.” Only the South, he
Minutes, Meeting of Board of Directors, Jacksonville, FL, 19–20 November 1945, SSIC
14
Papers Box 2, Folder 1; Charles A. Long to Lister Hill, 19 March 1945, Lister Hill
Papers, Box 140, Folder 24.

12
suggested, knew the dangers of bureaucratic control –a nod to the specter

of Reconstruction.15
That few southern manufacturers relied on free enterprise to win
allies regarding the FEPC in 1945 and 1946 is surprising given the SSIC’s
active embrace of the term regarding minimum wages and freight rates.
Yet the organization’s strategy to block the FEPC evolved as proposals
continued to appear. The changes in rhetoric and worldview taking hold
among SSIC leaders became clearer when President Truman renewed
his efforts for a permanent FEPC beginning with the Special Committee
on Civil Rights report in 1947. In Truman’s February 2, 1948, “Special
Address to Congress on Civil Rights,” the president set ten priorities for
improving civil rights in the nation, including antilynching legislation,
franchise protection, and an end to discrimination in interstate transpor-
tation. The fifth priority was the establishment of a permanent FEPC. The
FEPC failed repeatedly in Congress, but Truman’s support of the measure
invigorated southern resistance to any attempt to regulate employment
and hiring practices.16
Several southern congressional leaders called on the SSIC to testify
in the matter, including civil rights opponent Senator Richard Russell of
Georgia. If the FEPC brought the SSIC closer to southern representatives,
particularly the powerful Russell, Arnold was only too happy to render
service. Even as SSIC leaders used the FEPC to solidify relations with
powerful southern politicians, the conservatism of the postwar years and
the revived political and public reputation of business facilitated a shift
away from sectionally based SSIC arguments. As potential allies emerged
touting an antibureaucratic, anti–New Deal message, especially groups
such as the FEE and the NAM, SSIC leaders increasingly painted the
FEPC as part of a liberal and left-wing agenda, reversing the tactics they
used in response to the 1945 proposal, which relied more heavily on the
myths of Reconstruction.
Sensing remained a committed segregationist who sidestepped the
moral bankruptcy of his defense of Jim Crow. He paraded his argument
that “the South has no race problem” in numerous publications and
Remmie Arnold, address at a dinner meeting of southern congressmen, Washington, DC,

15
published as SSIC pamphlet, 17 January 1946, SSIC Papers Box 5, Folder 1, p. 4, SSIC
Remmie Arnold to Directors of the SSIC, 2 July 1947, SSIC Papers Box 5, Folder 2;
16
Harry S. Truman,” Special Message to the Congress on Civil Rights,” 2 February 1948.
Online by Gerhard Peters and John T. Woolley, The American Presidency Project. www
.presidency.ucsb.edu/ws/?pid=13006.
2
1
public speeches. Sensing believed that white elites in the South bestowed
segregation on a grateful African-American population and that segre-
gation in no way equaled “discrimination.” He considered separation of
the races to be a “moral obligation” and that “segregation is the only
natural way in which two races can live together.” When he did admit any
problem, he implicated the nation, which wanted to make an example
of the South without addressing problems regarding crime and poverty
elsewhere. Segregation, he maintained, was an acceptable alternative to
Ku Klux Klan–type methods, which he declared were “no more repre-
sentative of Southern thought and feeling in the questions of race than
the slum gangs are representatives of social life in New York City.” His
arguments were rife with faulty assumptions and disingenuous state-
ments that distanced him and his organization from contemporary busi-
ness associations, even if they shared similar views on the New Deal and
bureaucratic overreach.17
At the same time, Sensing’s arguments privileged racial harmony for
the benefit of business, revealing that southern business leaders partici-
pated, if reluctantly, in the tendency among the South’s urban, middle-
class moderates to promote the image of racial harmony even if local
circumstances belied this depiction. Sensing’s writings revealed an emerg-
ing strategy to transform the region’s political culture, in which propo-
nents of economic development invoked color-blind arguments against
desegregation to appear more in line with national priorities and values.
The SSIC’s new president in 1948, R. Kirby Longino, founder of New
Orleans dairy distributor Longino & Collins, echoed Sensing’s tactics by
implying that the FEPC’s consequences would affect the entire nation,
not just the South. While he referred to the bill as “anti-Southern legis-
lation,” he pointed out that the “dangers inherent in the thinking which
dominates those who have sought to impose this type of legislation on
us” threatened the “economic and social future of the South –and the
Nation.” Longino directed his appeal to southern Democrats and other
members of Congress who had voted for the Taft-Hartley Act. He hoped
that these politicians would recognize the need to limit the FEPC, as
17 Thurman Sensing, “Concerning: Jim Crow,” essay for publication, SSIC Papers Box 6,
Folder 1. For more on the moderates in the South regarding civil rights, see Matthew D.
Lassiter and Andrew B. Lewis, The Moderates’ Dilemma: Massive Resistance to School
Desegregation in Virginia (University of Virginia Press, 1998); Joseph Crespino, In Search
of Another Country: Mississippi and the Conservative Counterrevolution (Princeton,
NJ: Princeton University Press, 2007); W. A. Pittman (S.H. Kress & Co, Charleston, SC)
to Olin Johnston, 21 April 1945, Olin Johnston Papers, Legislation, 1945 (Labor, Fair
Employment Practices, f. 2 of 4), (hereafter cited as Olin Johnston Papers).

3
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2
they had in the case of the Wagner Act. In his eyes, the two proposals
garnered radicals’ support, and both would lead the nation in a socialist
direction.18
SSIC leaders capitalized on anti-FEPC sentiment to further their larger
political agenda. In a letter to all SSIC donors in 1948, Longino noted that
an unnamed “leading industrialist of the South” linked anti–civil rights
forces in the Democratic Party to New Deal opposition. Longino reported
that the manufacturer stated, “The ‘Revolt of the South’ goes back sev-
eral years to the time when patriotic Southern Senators and Congressmen
determined that we had followed the New Deal path of socialism too
long.” This revolt won numerous victories, including “defeat of a perma-
nent FEPC, repeal of OPA controls, enactment of the Case Bill, the Hobbs
Bill, the Portal to Portal Law, the Taft-Hartley Law, tax relief, and other
measures.” SSIC leaders strategized to block the FEPC by linking it with
threats that they claimed endangered the entire nation. In this reversal of
previous strategy, Longino and his allies judged that allies outside of the
traditional southern Democratic base were emerging and could assert
their opposition to laws on more than a sense of shared race, history, and
geography.19
When the issue arose again in 1950 and 1951, SSIC leaders relied on a
now-standard line on the FEPC that embodied their new formulation of
states’ rights. Yet the FEPC never emerged as an issue that would bring
nonsouthern conservatives into alignment with manufacturers organized
in the SSIC. The proposal’s unlikely passage, plus the issue’s inefficacy
in building allies, explains the FEPC’s diminished place in SSIC writings
after 1948. Although Sensing praised southern members of Congress
Alton Hornsby, Jr., “A City That Was Too Busy to Hate: Atlanta Businessmen and
18
Desegregation” in Jacoway and Colburn, Southern Businessmen and Desegregation,

120–136; Kirby Longino to Fielding L. Wright, 21 January 1948, SSIC Papers Box 5,
Folder 3. For Republicans’ assessment of civil rights and their divided support for the
FEPC, with some members citing enforcement provision as an “unwise and unjustified
expansions of federal power,” see Bowen, The Roots of Modern Conservatism, 46–48;
Thurber, Republicans and Race, 7–19.
R. Kirby Longino, “An Industrialist Speaks to Industrialists,” letter to SSIC constituency,
19
21 June 1948, SSIC Papers Box 6, Folder 1. The Case Bill referred to a proposal in 1946
to strengthen limits on labor, which Truman vetoed, but reemerged in the later Hobbs
Bill, see Gary A. Donaldson, Truman Defeats Dewey (University Press of Kentucky,
2000), 63–64, n.12, 230. The Portal to Portal Law limited wage and hour regulations
so it was not mandatory to pay workers traveling from one point to another. United
States Congress Senate Committee on Labor and Public Welfare, To Clarify the Overtime
Compensation Provisions of the Fair Labor Standards Act of 1938, as Amended (U.S.
Government Printing Office, 1949) 142; Daily Report on Labor-Management Problems
(Bureau of National Affairs, 1947) 56.
4
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2
for blocking the “obnoxious, bureaucratic FEPC measure, now being

proposed again,” when Truman once more raised the proposal, Sensing
invoked national ideals to sidestep the charges of discrimination leveled
at the South’s employers. “It is not a question of race, creed, color or
national origin as its proponents so glibly recite,” he charged, continuing,
“it’s a question of freedom of choice by the individual –for we must not
forget that if the government can tell the employer whom he must hire,
it can also tell the employee for whom he must work. Then where’s your
individual freedom?” Moreover, he expressed annoyance that few allies
emerged to help the SSIC and its friends block such proposals. When it
came to the FEPC, he concluded, “it must apparently be the people of the
South who block it.” Sensing retreated reluctantly to southern identity
in this case, a dramatic reversal from his previous entreaties to southern
representatives based on shared identity. At the same time, he advanced a
color-blind argument that would come to dominate SSIC rhetoric regard-
ing race relations.20
The communist threat provided a more useful link to conservatives
than overt invocations of southern tradition. SSIC leaders attempted to
uncouple their opposition to the FEPC from a separate southern history
in order to appeal to non-southerners and states’-rights supporters in the
context of the Cold War. Any state could enact its own FEPC, Sensing
declared, and those that did would become vulnerable to communist sub-
version. Indeed, several states passed their own laws, including New York,
Massachusetts, and Washington. Sensing denied that states’ rights was a
peculiarly southern obsession, writing, “the preservation of states’ rights
is just as important to Maine and California as it is to Alabama and
South Carolina.” When he did invoke the South, he elided the issue of
the South’s racial inequality and tried to paint the region as more truly
American. “If states’ rights has been considered mainly an issue raised by
the states of the South,” he wrote in a SSIC press release, “it is because
the people of the South have more consistently adhered to the princi-
ples implied therein and have more clearly seen the dangers involved in
departing therefrom. So much more to the credit of the South!”21
The political landscape bolstered SSIC efforts to block FEPC. With pow-
erful southerners in Congress to block most civil rights legislation, emphasis
on the FEPC proposals declined as a centerpiece of SSIC activism. Only a
20 Thurman Sensing, “The Test of Freedom,” News Bulletin, No. 102, 1 February 1951,
In debating the implications of New York’s FEPC law, Rep. John Rankin of Mississippi
21
declared, “the FEPC law in New York has dug a veritable storm cellar for every

5
1
2
few articles in the organization’s bimonthly Bulletin, distributed widely to

southern business and political leaders, featured the FEPC as a concern.
Instead articles headlined “We Must Pay as We Spend,” preaching against
federal deficit spending, or “Our Freedoms are in Peril,” criticizing Truman’s
nationalization of the steel industry in response to strikes during the Korean
War, dominated the Bulletin. When the Bulletin did include the FEPC, it
tended to be listed under Tyre Taylor’s “Report from Washington,” in which
he commented on southern congressional leaders’ efforts to block propos-
als; or Thurman Sensing included FEPC in his editorials, such as when he
portrayed Truman’s civil rights goals as a political power grab “to further
centralize complete control over the lives of the people in a bureaucratic
government.”22
SSIC leaders consciously linked FEPC to Cold War concerns in the
council’s program. In the SSIC’s annual Declaration of Principles, set by
the board of directors, FEPC appeared implicitly under the heading of
proposals that violated the “Rights of the Individual.” The list included
the United Nations Human Rights Council, neatly couching opposition
to measures that might threaten to expose segregation’s inequalities and
denial of civil rights as support of individual rights and conservative crit-
icism of the UN’s violation of state sovereignty. At the same time, efforts
to increase the council’s public visibility centered on dissemination of the
messages of free enterprise and of the South as an opportune place for
development.23
Communist in America who wants to go there and seek employment.” John Rankin
remarks before the House of Representatives, 6 August 1948, 94 Congressional Record –
House (Washington: United States Government Printing Office, 1948), 10110. Thurman
Sensing, “States Rights is a National Matter” SSIC Press Release No. 221, 17 October
1948; Thurman Sensing, “The FEPC is Purely Political,” SSIC press release, No. 278, 20
November 1949, SSIC Papers Box 6, Folder 2.
22 The SSIC printed 5,000 copies of the Bulletin in 1951: 1,000 went to the Southern
Railway, 2,000 went to members and 181 copies to southern congressional members, 214
to “house organ editors of member firms,” and 800 to various individuals for “special
reasons,” placed on the mailing list by the Board members or Directors, Thurman Sensing,
Exhibit A, Executive Committee Minutes, 7 May 1951, SSIC Papers Box 2, Folder 1. “We
Must Pay as We Spend” Bulletin, No. 99, 1 December 1950 SSIC Papers Box 7, Folder 1;
“Our Freedoms are in Dire Peril,” Bulletin, No. 133, 15 May 1952, SSIC Papers Box 1,
Folder 2. “Subsidies are Immoral,” Bulletin, No. 154, 1 April 1953; Sensing, “The FEPC
is Purely Political”; “Report from Washington,” Bulletin, 1 January 1952.
“A Declaration of Principles” Board of Directors meeting, Edgewater Park, MS, 22–23
23
May 1952, SSIC Papers Box 2, Folder 2; “Our Implemented Program: to the Employers
of the South,” Letter Service, 1 November 1946, SSIC Papers Box 2, Folder 1. See
Mary L. Dudziak, Cold War Civil Rights: Race and the Image of American Democracy
(Princeton, NJ: Princeton University Press, 2000).
6
1
2
Southern industrialists relied on free enterprise to obscure the appear-

ance but maintain the mechanisms of white supremacy. By the 1960s, in
areas that declared themselves “too busy to hate” –as Atlanta’s Mayor
William Berry Hartsfield phrased it –economic development seemed to
trump segregation among local boosters. This strategy, “invented and
sustained by a moderate coalition born not out of chance but through
careful calculation,” as one historian explains, was a “practical” move on
the part of middle-class whites in southern cities. These moderates had
a clear model in the region’s industrial elites, who exhibited this sort of
practicality in the evolution of their response to the FEPC.24
The transformation in how the SSIC confronted the FEPC was also
a product of the South’s changing labor market and the broader polit-
ical and policy landscape. Federal minimum wages and hours, regula-
tions, and the migration of labor and capital –not civil rights activism
alone –undermined the regional labor market. Southern Democrats
might prove to be allies on the FEPC, but many still supported Truman’s
Fair Deal. A tenuous political situation grew unwieldy, despite coopera-
tion among conservatives in blocking a robust FEPC. As historians have
noted, Cold War fears blunted reform, but arguments against liberalism
grew stronger owing to the growing coherence of business conserva-
tives’ response to the New Deal in the South. SSIC leaders demanded
a party that could offer comprehensive conservative policies, not one
that would roll back one “odious” program out of many. Yet SSIC lead-
ers realized that they still had a public relations problem. The South,
with its poor reputation on many fronts –economic development, vio-
lence toward blacks, and demagogic politics among them –required an
image makeover despite efforts to promote the region as the “Nation’s
Economic Opportunity No. 1.” This rebranding became the SSIC’s cen-
tral undertaking in the 1940s.25
Scholars have cited Ronald Reagan’s failure to consider the controversies of appear-
24
ing at Philadelphia, MS, in 1980 as evidence of the transformation of color- blind

rhetoric. Joseph Crespino, “Ronald Reagan’s South: The Tangled Roots of Modern
Southern Conservatism” in Gil Troy and Vincent J. Cannato, eds. Living in the
Eighties (New York: Oxford University Press, 2009), 28–41; Toby Bates, The Reagan
Rhetoric: History and Memory in the 1980s (DeKalb: Northern Illinois University
Press, 2011), chapter 1. For cohesion of Sunbelt conservatism related to metropolit-
anization, anticommunism, and the defense economy, see Sean P. Cunningham, American
Politics in the Postwar Sunbelt: Conservative Growth in a Battleground Region
(New York: Cambridge University Press, 2014), especially chapter 1.
Segregationist attitudes translated into a defense of “beleaguered rights,” a broader cate-
25
gory than the rights of employers, but nevertheless exhibiting a similar reliance on rights-
based language. Kruse, White Flight, 41.

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Rebranding the South 217
Rebranding the South
A permanent FEPC never became reality, but southern manufacturers
concluded that they still needed a broadened coalition of support for
their political agenda, particularly as the Wagner Act seemed fallible
in the years following the war. To recruit allies to amend the NLRA,
SSIC leaders understood that the South needed a better reputation: no
one wanted to ally with a region that seemed exploitative and produced
cheap goods that undercut competitors. In the mid-1940s, the SSIC refor-
mulated Dixie’s economic deficiencies into positive attributes. Drawing
on the region’s historical differences to provide a cautionary tale of what
might happen to the nation if the New Deal continued, this was a cal-
culated reimagining of the region’s past that differed from the organiza-
tion’s previous depictions. Instead of mobilizing to defend the South as
a backward, underdeveloped region exploited by outsiders, SSIC leaders
built an antiunion coalition by promoting the South’s positive business
climate, a product of state policies and reduced union influence in politics.
The South, which had grown to sixteen states by the SSIC’s definition,
remained the organization’s focus, but its leaders attempted to branch out
to fight “damaging forces” unleashed in the American political system as
a whole. SSIC leaders agreed that a “trend toward centralized control”
had emerged, leading government “away from individual responsibility,
states rights, and local and community self-government.” Enemies of
free enterprise had infiltrated the workings of government, SSIC leaders
argued. These foes remained the same as during the New Deal era: “loud-
mouthed minorities and political pressure groups pulling and hauling for
federal favors.” Continuation of wartime bureaus, such as the OPA, ran-
kled business, particularly as labor demanded higher wages to account
for higher prices that would emerge as price controls faded. SSIC leaders
largely dropped their former arguments emphasizing special protections
for the South, such as wage differentials for the region’s infant industry,
in favor of sweeping arguments invoking national values. In so doing,
they hoped to appeal to those small and medium-sized manufacturers in
other regions who could not weather the challenges posed by organized
labor, bureaucratic oversight, or a federal minimum wage.26
The SSIC’s touting of the South as a separate entity did not disap-
pear, but the organization’s formulation of regional identity was becom-
ing more flexible and ideological. The South and “southern-ness” served
26 Arnold, address at a dinner meeting of southern congressmen, p. 3; Robert Zeiger, The
CIO: 1935–1955 (Chapel Hill: University of North Carolina Press, 1998), 244.
8
1
2
as important transitional ideas in the move toward national appeal for

the SSIC’s conservatism. During the 1930s, the council sought to defend
the South’s “traditions” and “civilization” alongside and, indeed, in con-
nection with economic interest. In the mid-1940s, the South’s historical
experiences, SSIC leaders argued, provided regional representatives with
a unique perspective on the nation’s problems. Rather than retreating
into sectional differences, the SSIC, in its defensiveness, turned outward,
and its leaders invoked notions of shared traditions and history as ratio-
nales to block trends they identified as harmful. Tyre Taylor explained,
“In a profound sense the New Deal is a counter-revolution against the
personal freedom established by the American Revolution. There is, for
example, nothing but black reaction in the assumption –implicit in the
entire New Deal program of regimentation –that the people must live
their lives in a government straight jacket.”27
The South served as a cautionary tale in the SSIC’s official prescrip-
tions for policy. Remmie Arnold expressed this sentiment in 1946 as
he reinterpreted the council’s history of activism against “enemies of
democracy” who wanted to supplant the nation’s founding principles
with “federal paternalism, favoritism, and bureaucracy.” According to
Arnold, the “strength of convictions” and “wholehearted support” of
the South’s residents bolstered the SSIC in its fight against “un-American
activities.” Southerners, he asserted, possessed pure constitutional values
and common sense that would lead the nation. The South’s experience
with bureaucratic administration and federal meddling, SSIC leaders
argued –referring to their interpretation of the South’s experience during
Reconstruction –privileged the section’s opinions over others’. Sensing
asserted that the South, following the Civil War, “had to work its way
out of its problems the best it could,” without the help of Lend-Lease
or “United Nations Rehabilitation and Relief for the South,” and he
argued that the South was better off without these resources. Despite
the hardships of defeat, Sensing argued, the South remained unwilling to
trade its traditions and principles, as he understood them, for “a mess of
pottage.”28
For all the SSIC’s emphasis on southern history and the South’s role
as a “bulwark of democracy,” the organization’s objectives in the late
1940s downplayed regional defensiveness and protectionism. The SSIC’s
Tyre Taylor, “What’s Under the Bed?” 25 May 1944, SSIC Papers Box 4, Folder 3.
27
28 Remmie Arnold, “Chickens Come Home to Roost,” to industrialists of the South, 22

March 1946, SSIC Papers Box 5, Folder 2; Thurman Sensing, “Our Southern Economy,”

9
1
2
Rebranding the South 219
revised position created new points of commonality with conservative

organizations such as the FEE. SSIC leaders pursued an aggressive public
education campaign, one waged through distribution of materials, public
appearances and lectures, and news releases. In 1948 alone, the organiza-
tion sent out more than 50,000 copies of its “Re-Declaration of Rights”
that defined the SSIC’s central beliefs. Thousands of copies of speeches,
bulletins, reprints of articles, and other materials streamed out of the
SSIC’s headquarters in the Stahlman Building in Nashville. Beginning in
1941, SSIC adviser Gus Dyer traveled to five or six colleges in each of
the (then) “fifteen southern states” to preach the SSIC’s message, and the
organization raised more than $9,500 to support an educational pro-
gram. Whereas the SSIC in the mid-1930s rallied southern congressmen
to defend the South’s “moral and spiritual values,” by 1948 council mem-
bers targeted a wider audience with their calls for action against forces
that sought to destroy the “American Way of Life.”29
To complement actions by the NAM, the Chamber of Commerce, the
FEE, and emergent free-market organizations, SSIC leaders reached out
to southern industrialists to ask them to voice support for, or opposition
to, particular policies in Washington by writing representatives. Although
SSIC leaders had not developed a full economic program, they began to
emphasize the need to introduce the public to free-market ideas being
discussed in business circles. In so doing, the SSIC joined the emerging
constellation of free-market and conservative groups and related public-
ity efforts that dotted the American political landscape to confront the
welfare state’s “creeping socialism.” Moreover, New South industrialists
proved they could reach out to workers and communities.30
Truman’s unveiling of his twenty-one-point program for a “Fair Deal”
elicited condemnations from southern business conservatives alleging
unsustainable government spending and bureaucratic bloat. While criti-
cizing the complicity of southern congressional leaders in the “Fair Deal
Oligarchy,” SSIC leaders charged the Truman administration with vio-
lating American principles in chorus with the president’s critics on the
an address delivered before the Southern Conference on Human Relations in Industry,

Blue Ridge, North Carolina, 19 July 1946, SSIC Pamphlet, 1 December 1946, SSIC
Papers Box 5, Folder 2. See also, Remmie Arnold, “Full Speed Ahead,” in News Bulletin,
No. 3, 1 December 1946, SSIC Papers Box 5, Folder 2.
29 “A Re-Declaration of Rights,” SSIC Pamphlet, 8 January 1948, SSIC Papers Box 2, Folder
1; “Exhibit 2,” Executive Committee Meeting Minutes, 26 April 1948, SSIC Papers Box
2, Folder 1; Wall, Inventing the “American Way,” 34–35.
Executive Committee Meeting Minutes, 21 August 1941, SSIC Papers Box 2, Folder 1.
30
0
2
right. In an official statement, the SSIC declared that Truman adopted

“collectivist policies” that undermined the monetary system, deval-
ued the dollar, and infringed on property rights. SSIC representatives
argued that “fallacious” theories about the neutrality of a national debt
harmed national prosperity. Programs pursued by the Democrats under-
mined local self-government and rendered states “subservient to the will
of federal bureaucrats.” Regulations for wages and working conditions,
SSIC leaders charged, eliminated all equality in contract negotiation and
employee relations in favor of labor. Subsidies, favoritism, and other
aid, the SSIC argued, “seduced” labor and farmers and reduced them to
“slaves to a socialist state.” Government denied individuals their “right
to work,” referring to union shop allowances. Taxes damaged individual
initiative and undermined the profit motive. Lastly, the Truman admin-
istration “by deceit and guile sought to control our educational system,
thereby to lead the American people into the ways of socialism, and to
destroy the American Way of Life.”31
In these protests, SSIC leaders decreased their depictions of the South
as a cautionary tale and instead promoted the region as a reserve of
American ideals. This new role for the South was a dramatic reversal in
the organization’s rhetoric. The SSIC previously interpreted New Deal
economic policy as the Roosevelt administration’s privileging of north-
eastern industrial interests over the South’s, intentional or not. While
southern manufacturers had reason to suspect that New Deal policy
makers targeted southern wages, in the 1940s a different interpretation
emerged.
As the CIO began “Operation Dixie,” a campaign to organize labor
in the South, Virginia pen manufacturer and SSIC president Remmie
Arnold offered this new interpretation. He told a group of executives,
“[The CIO is] coming South because they realize there is more true
Americanism, more real patriotism here than in any other section of the
country, and because they know communism can never be forced upon
this country as long as the people are free to live under the democratic
institutions which have made America great.” Arnold depicted the South
as the repository of these national values. He maintained the mythol-
ogy of Reconstruction to make his point, continuing, “It is my hum-
ble judgment that these carpet-baggers will accomplish no more than
those of 1865.” But he also asserted that the South was more deeply
31 R. Kirby Longino, “Leadership or Unity?” Bulletin, No. 91, 16 August 1950, SSIC Papers
Box 7, Folder 1. “A Re-Declaration of Rights.”

1
2
Principles of Free Enterprise 221
connected to national purposes and ideals, rather than being an outlier

to national trends and victim of discrimination. “The South is strong in
its faith –of God and of those principles which uphold and defend the
rights of the individual,” he declared, “and with God’s help it will remain
American.”32
The SSIC constructed the region as a “bulwark of democracy” against
what it saw as dangerous policies that would allow the infiltration of
socialism and communism. Such a depiction not only enabled southern
manufacturers’ promotion of the region as a good place to do business
by capitalizing on Cold War political culture but also signaled the policies
that the SSIC would pursue to maintain the region’s competitive advan-
tage in low wage labor. The most pernicious threat to this advantage was
the Wagner Act, and in 1946 and 1947, the SSIC campaigned to reform
the law and preserve the “right to work.”
Principles of Free Enterprise: Taft-Hartley

and Operation Dixie
Southern workers’ union membership increased during the war years.
As workers left for military service, the labor market tightened, and
employers had less leverage to thwart union organizing. To confront
this trend, a host of organizations materialized across the region. These
groups relied on the language of free enterprise. Many foes of labor mil-
itarized the term, such as Texas’s Fight for Free Enterprise (FFE), which
used the courts to block CIO organizing in the state. Proposals to reform
the Wagner Act emerged in Congress and would culminate with Taft-
Hartley in 1947. In 1946 and 1947, SSIC leaders relinquished previous
depictions of southern employers’ more “personal” relations with labor,
as well as their emphasis on the structural differences between north-
ern and southern firms and the homogenous and uneducated status of
Dixie’s labor. This transition was not smooth or natural. Blocking fed-
eral support for collective bargaining had been a central component of
SSIC activism since NIRA’s Section 7a helped inspire the organization’s
establishment. Yet postwar political and economic developments yielded
new rhetoric against unionization among the region’s industrial leaders,
as they balanced the logic of appealing to southern politicians against
Remmie Arnold, “The South –Bulwark of Democracy,” address delivered before the
32
Sphinx Club of Richmond, Virginia, 25 April 1946, SSIC Pamphlet, SSIC Papers Box 5,
Folder 2.
2
the pressure to seek allies among emerging business and conservative

associations.33
The SSIC complemented efforts by business and conservative groups,
such as the FEE and the American Enterprise Association (later American
Enterprise Institute), which had mobilized during the war and immedi-
ately after. With time, SSIC leaders connected their particularly southern
concerns to an emerging framework for conservative, business-led activ-
ism. In doing so, the leaders compiled a list of southern issues that could
be defended by promoting free enterprise. Chief among them was the
blocking of a renewed union campaign in the South. As the CIO under-
took “Operation Dixie” to organize southern textile workers in 1946 and
1947, regional industrial and agricultural interests in the South capital-
ized on business’ improved public standing following the war to thwart
the CIO’s efforts.34
The SSIC also served as a platform for established southern manufac-
turers to fight Operation Dixie in ways that differed from the approaches
of national business associations such as the NAM and FEE. Even though
southern manufacturers “promoted a ‘states rights’ program that meshed
neatly with northern businessmen’s efforts to curb unionism,” the South’s
economic conservatism did not completely mirror national business lead-
ers’ rhetoric. Rebranding the South as the haven of free enterprise took
Marshall, Labor in the South (Cambridge, MA: Harvard University Press, 1967)
33
244– 245; “Texas Employers Planned Frame- Up to Kill CIO Drive” Daily Worker
(Columbus, OH), 4 August 1945, “New Anti-Union Outfit Being Formed in Texas,”
Daily Worker, 25 June 1945, United Auto Workers Research Files Box 3 Folder 7,
Walter P. Reuther Library, Wayne State University, Detroit, MI (hereafter cited as UAW
Research Files). The CIO charged FEE with organizing violence against union represen-
tatives in Texas, launching campaigns of a “false and vitriolic” nature, and pursuing “use
of the press and radio to inflame public opinion against the CIO” –tactics similar to
what the SSIC was disseminating across the South. “File Evidence in Texas of Anti-CIO
Conspiracy,” Daily Worker, 7 August 1945, UAW Research Files; Richard Polenberg,
“The National Committee to Uphold Constitutional Government, 1937–1941,” Journal
of American History 52, no. 3 (1965), 582–598.
Fones-Wolf, Selling Free Enterprise. Patterson, Congressional Conservatism and the New
34
Deal, 52. In addition to Congress passing the Smith-Connally War Labor Disputes Act
over FDR’s veto, reconversion to peacetime unleashed further political uncertainty as
fears of strikes prompted business leaders to mobilize. One example of antiunion propos-
als that alarmed the CIO was a bill that reportedly passed through the House Military
Affairs Committee in October 1945, as a strike at General Motors loomed, that “bans
all political activity by unions under penalty of $5,000 fines to be levied against the orga-
nization’s treasury and the individual officers,” which garnered support from “a combi-
nation of antilabor Republicans and southern polltaxers.” “Congressmen and Labor Hit
Bill to Gag Unions,” Daily Worker (New York, NY), 1 November 1945, UAW Research
Files, Box 3 Folder 7. See also Lichtenstein, Labor’s War at Home, 177, 203, 224–227.

3
2
time and careful crafting. The architects had to incorporate the needs
of existing industry while also pursuing a positive reputation for the
region’s business climate. SSIC leaders promoted the region’s competitive
advantages and beneficial business.35
Although ideas about the rights of employers had appeared in the
SSIC’s protests against the Wagner Act, such language took on added
power in the ideological context of the war. Then Gus Dyer pursued a
public speaking tour during which he argued repeatedly before varied
audiences that the “right to work” had become America’s “forgotten
freedom.” Dyer insisted that closed shop practices violated freedom of
contract as a constitutional right as well as undermined the right to pur-
chase services or commodities at fair market values under contractual
agreements. Dyer explained, “No honest man has either an economic or
a moral right to demand more than the market value for anything he
has to sell –to demand more than this is to demand that which does
not belong to him.” Given Dyer’s argument that wages directly reflected
the combination of market price of goods and employee benefits, pol-
icies demanding that wages be similar across region, industry, or even
industrial category, in his opinion, violated this principle. The language
of rights and free enterprise smoothed the transition from specifically
southern-based protectionism to cooperation with other business and
conservative groups following the war.36
As with the FEPC, SSIC leaders were mindful of the political landscape
and the sensibilities of prominent southern politicians. The SSIC’s inner cir-
cle shaped rhetoric to woo southern politicians. Their activism on behalf of
the preservation of low wages by blocking bureaucratic growth, Tyre Taylor
insisted, would rally true conservatives, and their invocation of Reconstruction
appealed to southern politicians who might be wary of industry. Reconstruction
imagery thus pervaded the SSIC’s campaign against Operation Dixie, mirror-
ing the language of southern representatives. Referring to the CIO campaign,
Representative Howard Smith of Virginia asked, “Have the Southern people
become so supine and spineless that they will meekly submit to another carpet-
bagger invasion without raising a voice in protest?”37
35 Tami J. Friedman, “Capital Flight, ‘States Rights,’ and the Anti-Labor Offensive After
World War II” in Nelson Lichtenstein and Elizabeth Tandy Shermer, eds. The Right
and Labor in America: Politics, Ideology, and Imagination (Philadelphia: University of
Pennsylvania Press, 2012), 79–82.
Gus W. Dyer, “The Right to Work –The Forgotten Freedom,” SSIC pamphlet, August
36

Howard Smith in “Operation Dixie –Some Suggested Countermeasures,” Tyre Taylor to
37
SSIC constituency, 8 May 1948, SSIC Papers Box 5, Folder 2.

4
2
With these allies in mind, Operation Dixie appeared in SSIC rhetoric

as a politically orchestrated attack on the South as much as a campaign
to mobilize southern workers. Referring to the CIO as a political action
committee (PAC), Taylor interpreted the recruitment campaign as an
attack on southern congressmen who did not “hew to the CIO-PAC-New
Deal party line.” In pointing to political repercussions, SSIC leaders hoped
to convince southern politicians to “lay an ax” to the system “whereby
Government confers special favors, privileges, and immunities upon the
unions.” Taylor worked closely with members of Congress to promote the
SSIC’s recommendations for labor reform, and he blended constitutional
arguments and southern defensiveness to appeal to Dixie’s politicians.38
Wartime strikes had outraged southern industrialists, but their con-
cerns grew as labor unrest spread after the war’s end. In 1946, strikes
consumed more than 116 million days of work, with 4.6 percent of
American workers participating. While the CIO ran headlong into oppo-
sition to Operation Dixie from the powerful textile industry, the SSIC
ramped up its efforts to amend the Wagner Act. Leaders declared their
support for the Wagner Act’s principle –that collective bargaining was a
right guaranteed to workers as a safeguard against exploitation. But this
was a hollow statement given manufacturers’ opposition to labor’s right
to bargain collectively with federal support. The SSIC’s criticisms of col-
lective bargaining in practice were severe indeed. SSIC leaders declared
that the Wagner Act forged no less than a labor “dictatorship” over lead-
ing American industries and that the law had entirely failed in its central
purpose. Individual employees suffered, disruption occurred in interstate
commerce, and “industrial strife” ran rampant, SSIC leaders contended.
They lay the blame at the feet of labor bosses who abused the trust of
workers and violated their constitutional rights, not to mention the rights
of employers.39
SSIC leaders issued a litany of complaints about the NLRA. The Wagner
Act’s greatest failure, Remmie Arnold charged, was its inability to limit
38 Taylor, 8 May 1946. In 1947, the Board of Directors heard reports how Tyre Taylor,
“working in close touch with Senator Ball and others, is entitled to high commendation
for the valuable services he rendered in the presentation of the council’s program, which,
generally speaking, was fully covered by the new law.” While it is unclear how instrumen-
tal Taylor was in procuring Ball’s support on the specific amendments, the law did reflect
the SSIC’s central positions, particularly relating to weakening the closed shop. Remmie
Arnold, Exhibit 1, Board of Directors Meeting Minutes, Board of Directors Meeting, 31
October –1 November 1947 SSIC Papers Box 2, Folder 1.
Remmie Arnold, “The National Labor Relations Law Must Be Amended” 27 June 1946,
39

5
2
strikes. The number of strikes in 1946 alone, he argued, demonstrated

the fallacy of the Act’s “high-sounding promises.” Union organizers “lull
the people of this Nation into a feeling of false security,” he charged, and
“their real purpose was to establish a power which would permit those
who control this force to contemptuously disregard everything but their
own selfish interests.” In addition to ascribing sinister motives to union
bosses, the SSIC president cited NLRB misadministration of the law, the
authorization of collective bargaining for mutual aid and protection,
and the establishment of standards for unfair labor practices that unduly
punished employers. Wagner’s promise of equality in bargaining between
employers and employees had not been fulfilled, Arnold declared. Instead,
he continued, “the administration of the law has been honeycombed with
favoritism and partiality … [and] the enforcement of the Act has been
as one-sided in favor of organized labor as its provisions would indi-
cate and permit.” Regional boards were “prejudiced and biased” against
employees. Furthermore, the NLRA required employers to bargain with
workers’ representatives but did not require that employees or their
representatives come to the bargaining table. Although Arnold did not
recognize the “partiality and favoritism” that he himself sought for the
SSIC’s member firms, he nevertheless presented an argument resonant
among national conservatives, not just those of Dixie’s industrial elite.40
In the mid-1940s, the SSIC undertook a campaign for two proposed
amendments to the Wagner Act. The first amendment promised to restore
what SSIC leaders considered “true” collective bargaining. This meant
that workers’ conditions could be arranged collectively but individuals
still signed contracts without “pressure” from unions and maintained their
“right to work,” a measure that struck at the closed shop. Individuals,
the SSIC argued, should retain the right to negotiate their own contracts,
regardless of contracts employers made with other employees. The second
amendment targeted NLRB enforcement, charging that it restricted the
free speech of employers who had been prohibited from discussing on
an individual or collective basis “all matters pertaining to labor unions,
40 Work stoppages reached 4,985 in 1946, involving 14 percent of workers. Strike levels
would remain above Depression-era numbers through 1954, reaching a high point in
1952 with 5,117, but never reached the level of worker participation in 1946. No. 257,
Work Stoppages: 1933–1954, Statistical Abstract of the United States, 1955 (Washington
DC: GPO, 1955) 220; Arnold, “The National Labor Relations Law Must Be Amended.”
Friedman demonstrates how a cross-regional antilabor alliance was growing in the post-
war years. Freidman in Lichtenstein and Shermer, The Right and Labor in America. See
also Lichtenstein, Labor’s War at Home.
6
2
labor-management relations and labor contracts.” SSIC leaders wanted to

lobby workers directly when union organizers showed up at their plants.41
A few other suggested amendments arose. Supervisory employ-
ees should be excluded from all provisions, SSIC members argued.
Furthermore, they targeted industrial unionism, insisting that unions
should be subject to antitrust laws and therefore be prohibited from
unionizing entire sectors. The SSIC also supported the prohibition of
secondary boycotts and demanded that the NLRB’s actions should be
subject to judicial review.
Specific union “abuses,” however, were not the SSIC’s true reason for
demanding NLRA amendment. Even after a court held John L. Lewis
in contempt over the 1946 UMW strike, which had served as the SSIC’s
primary example of labor leaders’ abuses, the SSIC still called for changes
in the law. Truman’s breakup of the strike offered no comfort to south-
ern industrialists, who argued that federal bureaucracies could arbitrarily
exercise power over either labor or management. Citing a speech by
Senator Byrd, Tyre Taylor declared that the American populace recog-
nized that unions had become a “Frankenstein” that threatened to destroy
American industry. Even with the UMW’s defeat, something substantial
needed to be done legislatively to curb this power. Regulation was insuffi-
cient, Byrd argued –the power of unions must be “affirmatively reduced.”
SSIC leaders of course also wanted to preserve the South’s low wages and
gain on the already steady relocation of industry southward to access the
region’s nonunionized labor –all the while protecting established south-
ern industries that depended on cheap, docile labor.42
The movement of textile manufacturing from North to South in
the 1920s was merely a prelude to capital flight to come. “What had
been a trickle of manufacturing jobs out of the industrial heartland
became a flood,” as one historian describes industrial relocations in
the late 1940s and 1950s. This development was a disaster for north-
ern cities, but southern manufacturers and local boosters scrambled to
promote the conditions that kept the South’s businesses competitive
and attracted new investment. The “right-to-work” laws that south-
ern states would pass following Taft-Hartley were a product of busi-
ness leaders’ and boosters’ efforts to promote Dixie’s business climate.
Arnold, “The National Labor Relations Law Must Be Amended.”

41
42 Tyre Taylor, “Report from Washington,” News Bulletin, 16 December 1946. The CIO
did develop more effective political operations during the war, but it never established a
national labor party. SSIC leaders were correct to anticipate the labor leaders’ political
aspirations, but overstated union organizations’ success. Zeiger, The CIO, 179–180.

7
2
Southern business leaders, industrial boosters, and state houses pursued

industrial recruitment based on the favorable circumstances the SSIC
attempted to preserve: cheap labor, abundant affordable land, light
regulation, and favorable tax environments and incentives (which were
multiplying in the 1950s, when many states lowered corporate income
taxes). Textiles continued their migration South, along with extractive
industries and manufacturing with increased efficiency in technology,
such as the automotive industry. The SSIC’s vision for southern indus-
trial development seemed to be working. Yet these gains also raised the
stakes for the organization’s policies’ success. Industrialists wanted to
employ, but also to preserve, the region’s surplus, unskilled, low-wage
labor.43
The rhetorical reversal from seeking protection to promoting the
South’s business climate camouflaged the cutthroat competition between
regions of the country. Regional advocacy still cemented the SSIC’s
purpose even as the organization connected southern circumstances to
national priorities and values.44
SSIC leaders thus celebrated the passage of Taft- Hartley –over
President Truman’s veto –as a victory for American business. The 1947 act
banned sympathy strikes and allowed states to pass right-to-work laws,
under which workers could refuse to pay dues to the bargaining agent.
The bill, a culmination of sustained activism of business groups such as
the NAM, chambers of commerce, and the SSIC, reflected union critics’
belief that the power of labor and management had to be equalized. SSIC
leaders congratulated themselves on achieving their goal after constant
effort. Remmie Arnold described the bill as “the culmination of a twelve
year effort on the part of the [SSIC] to have the Wagner Act amended to
restore equality under the law in all employer-employee relations.” Taft-
Hartley returned rights to management, he explained, without reversing
the labor movement. Union shops continued to be permitted in states that
did not pass right-to-work laws –democracy and local preferences, he
explained, would determine the landscape of union regulations, not the
NLRB. Arnold declared Taft-Hartley a “fair law,” one that empowered
individuals to negotiate with employers. Government, management, and
43 Thomas Sugrue, The Origins of the Urban Crisis: Race and Inequality in Postwar Detroit
(Princeton, NJ: Princeton University Press, 1996), 127. Changes in the auto industry pre-
cipitated the growth of production in the South. See Karsten Hülsemann, “Greenfields in
the Heart of Dixie: How the American Auto Industry Discovered the South,” in Scranton,
The Second Wave, 219, 227–228. See also Cowie, Capital Moves.
Tyre Taylor, “Report from Washington,” 16 December 1946.
44
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2
labor received equal responsibility for industrial peace, Arnold claimed.

Taft-Hartley told organized labor that it was now “grown-up” and there-
fore had rights and responsibilities and should not threaten Congress,
the law, or the people. To do so made labor appear to be a petulant
child, he charged. Management also gained new responsibilities, Arnold
explained, particularly in being allowed to “talk” to employees.45
Increasing public outreach became a central focus for SSIC leaders
as they celebrated their victory. The organization’s message targeted
multiple audiences: workers and potential political allies. Management
could speak with workers, using the pay envelope as a place to distrib-
ute free enterprise “education,” a common practice among managers.
The SSIC received constant requests for pamphlets of leaders’ writings
and speeches sized for enclosure with employees’ remuneration. Arnold
underscored SSIC members’ duty as employers and stewards of their
employees’ livelihoods and political activities, but he warned that man-
agement should not be too aggressive. He cautioned, “Your rights under
this new law are largely dependent on the manner in which you measure
up to your responsibilities,” implying that management should not wage
too forceful a campaign against union organizers. He advised industri-
alists to bide their time. Strategically speaking, with the ability to cajole
and persuade workers, southern managers could undermine unionization
efforts by invoking local traditions and obligations. States with lower
levels of unionization, Arnold believed, would demonstrate through their
prosperity the logic of the open shop.46
Boosters and business leaders secured the subsequent passage of right-
to-work laws in many southern and southwestern states, capitalizing on
fears of communism. Individual rights, states’ rights: these themes ran
throughout the SSIC’s continued condemnation of labor organizations
after Taft-Hartley. Unions pursued “centralization” and “compromise”
with socialistic ideas and succor for communists, the charge went. Only
by ranking the “human factor” over all else, Thurman Sensing argued,
would “democracy triumph over totalitarianism.” SSIC leaders linked
antiunionism with Cold War defenses of democracy. By promoting free-
dom of the individual in the workplace, business representatives con-
cluded, they promoted the ideals of individual freedom and states’ rights.
SSIC leaders were not the only voices making such connections, but
southern industrialists’ activism and the terms of the Red Scare that they
Remmie Arnold to SSIC constituency, 1 July 1947, SSIC Papers Box 5, Folder 3.
45
Ibid.
46

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Political Consequences: Seeking a Two-Party South 229
supported had lasting consequences for the nation’s political culture and
the South’s emerging significance to the conservative movement.47
Thurman Sensing emphasized the national importance of the SSIC’s
advocacy of core economic and democratic principles, which –he
thought –found their greatest support in the southern states. Such a
positioning, Sensing hoped, would lead to greater policy influence on
behalf of existing southern industries, from oil in Texas to textiles in
South Carolina. SSIC leaders mobilized to influence the national political
environment, maintaining non-southern newspaper syndication and con-
versing with representatives who were not conservative or southern. The
SSIC continued to seek wider audiences for its economic and political
messages, particularly as the organization connected its program to the
free-market movement, operating under the advice of Austrian econo-
mist Friedrich Hayek. Yet the SSIC continued to be frustrated by the lack
of conservative political leaders. The presidential elections of 1944 and
1948 demonstrated the range of strategies that SSIC leaders were will-
ing to pursue, as well as the shifting postwar partisan environment that
would reshape southern conservatives’ view of national electoral politics.
Political Consequences: Seeking
a Two-Party South
Since the organization’s beginnings, SSIC leaders actively sought to
build a national conservative party. What they lacked, however, was a
leader around which a movement could coalesce –though not for lack
of effort. Congressional conservatives mounted an effective counter to
the New Deal in 1937, and politicians such as Carter Glass, Harry Byrd,
Walter George, “Cotton” Ed Smith, James F. Byrnes, Josiah Bailey, and
Pat Harrison received the SSIC’s approbation. Several factors limited a
comprehensive conservative countermovement, including the South’s
entrenched poverty, President Roosevelt’s popularity, and the strength of
one-party rule in Dixie. Segregation remained entrenched; the New Deal
largely ignored racial inequities. Although many southern representa-
tives recognized the potential links between liberals and civil rights in the
1930s, radical demagogues such as Senator Theodore Bilbo of Mississippi
Thurman Sensing, “Human Relations in the South,” “Down South” 25 April 1948, SSIC
47
Papers Box 6, Folder 1. For more on the cultural context of the Cold War and the nar-
rowing of political dissent to the benefit of conservatives, see Stephen J. Whitfield, The
Culture of the Cold War, 2nd edition (Baltimore: Johns Hopkins University Press, 1996),
10–25. On right-to-work ballot measures, see Shermer, Sunbelt Capitalism, 97–98.
0
3
2
remained in the Democratic camp. While a conservative coalition blocked

further reform, cooperation in stopping a permanent FEPC did not trans-
late into the conservative counterattack on the New Deal and implemen-
tation of the Fair Deal that southern industrialists favored.48
Through the 1930s, the SSIC centered its efforts on reclaiming a
Democratic Party based on “tradition.” Many members doubted they
could convince the rank-and-file southern voter to cast a ballot for any
other party. Roosevelt’s unsuccessful purge of conservative southern rep-
resentatives in the 1938 midterm elections agitated business activists, and
several prominent southerners abandoned the party by 1940. Business
leaders were active in the Democrats-for-Willkie campaign, but gained no
real purchase in the South outside of small circles. For example, Nashville
Banner editor-in-chief and strong SSIC supporter James Stahlman backed
Wendell Willkie in 1940, although he admitted that the man was not his
ideal candidate. The war further highlighted business disapproval of the
Roosevelt administration’s reform of relations between the federal gov-
ernment and Dixie, and the president’s 1944 recommitment to the New
Deal outraged southern business leaders tired of wage and hour regula-
tions and wartime price controls.49
Many conservative southerners lamented the lack of leadership from
within the South. As one Georgia businessman put it, “Fire is being scat-
tered” but “we are not getting anywhere.” Unless a true conservative
declared his candidacy, the Democratic Party would be lost. Conservatives
found much to complain about, but no political alternative to the New
Deal’s strength in the South. Nevertheless, a few Democrats offered possi-
bilities, and the SSIC cultivated these relationships with hopes of yielding
political results.50
Kari Frederickson, The Dixiecrat Revolt and the End of the Solid South, 1932–1968
48
(Chapel Hill: University of North Carolina Press, 2001), 23, 27.

Democrats-for-Willkie had one leader from southern business, John W. Hanes, who had
49
ties to the P. H. Hanes Company and R. J. Reynolds, but he moved in elite New York social
and financial circles and served as the governor of the New York Stock Exchange after
his tenure as Assistant Secretary of the Treasury. John Wesley Hanes, Sr., 31 December
1987, obituary in New York Times. New Deal defection in the South became stronger
with the “non-emergency New Deal” aimed primarily at northern cities, especially as
“minimum wage legislation threatened to erode the competitive advantages enjoyed by
low-wage southern industry.” Anthony Badger, The New Deal: The Depression Years,
1933–1940 (New York: Hill & Wang, 1989), 269, 270; Stahlman to Dunkleburger,
Stahlman, VII.
A. S. Grinalds to John U. Barr, 30 August 1944, Box 171 in Papers of Harry Flood
50
Byrd, Sr., Accession #9700, 9700-b, Special Collections, University of Virginia Library,
Charlottesville, VA (hereafter cited as Harry F. Byrd Papers).

1
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2
SSIC leaders developed close ties with several southern senators, the
closest of all with Senator Byrd. As early as 1935, the SSIC looked to
Byrd as a potential Democratic presidential candidate. Byrd and Tyre
Taylor discussed the inapplicability of party labels before the 1936 elec-
tion, referring to southerners as opposing “collectivism.” In 1940, Taylor
said that he looked upon the Senator as the “logical man” to receive the
Democratic nomination. Byrd possessed all the attributes treasured by
SSIC leaders: he was a staunch conservative, he called for a balanced
budget and restraint in spending, and he opposed expanding the wel-
fare state. He appealed to the antilabor and racially discriminatory senti-
ments espoused by SSIC leaders when he railed against labor leaders and
“minority groups” who were leading the Democratic Party astray.51
Later, the senator called for fiscal restraint in the Marshall Plan and
relief spending overseas. SSIC leaders supported direct confrontations
with communism, but they looked at postwar European governments as
lost causes, hopelessly committed to socialism. The fact that Byrd boasted
of using New Deal funding to create thousands of government jobs for
Virginians failed to discourage the SSIC from courting him as a future
conservative leader; leaders reasoned that at least Byrd recognized the
fallacy of running a deficit to buy foreign allies.
Byrd often declared that he did not want to be president, but he was
honored by repeated attempts to draft him as a candidate and never
issued strong protest against his name being raised. His equivocations
frustrated supporters while also encouraging them. In the ongoing search
for leadership for the Party’s conservative wing, one supporter explained
the situation: “It looks to me as if we need to concentrate and to get
to working together. I cannot see how this is going to be done unless
some leader like Senator Byrd or Senator George … would be willing to
come out and take the lead.” In 1944, Byrd expressed his unwillingness
to enter the national fray, but several leaders held out hope that they
could influence electoral politics in their home states to stymie President
Roosevelt’s intention to run for a fourth term. Byrd never renounced his
candidacy, preferring to court attention and keep his supporters close.
While he enjoyed the limelight, Byrd shrewdly recognized that running
on ideology would mean certain defeat and would damage his powerful
political machine in Virginia.52
Tyre Taylor to Harry Byrd, 15 October 1935, Harry F. Byrd Papers, 151; Tyre Taylor,
51
“Plan for Proposed Magazine,” Harry F. Byrd Papers, 171.

Heinemann, Harry Byrd of Virginia, 238; Grinalds to Barr, 30 August 1944.
52
2
3
John U. Barr, an SSIC vice president and New Orleans pen manufacturer,
was the organization’s most vocal and trenchant conservative critic of
Roosevelt’s presidency, and he led the Draft-Byrd-for-President campaign.
Barr was active in New Orleans politics and was a “leading contributor”
to Louisiana states’-rights governor Sam Jones. State issues, it seemed,
aroused Barr’s extreme language and positions. Although Louisiana’s
notorious governor Huey Long was assassinated in 1935, the mighty
Long political machine lived on, inspiring Barr’s push for a third party.
Referring to Long’s murder in a 1944 letter to Byrd, Barr insisted that “[We
Louisianans] knew by bitter personal experience that alls [sic.] that saved
us in our state was the intervention of the hands of the ‘Grim Reaper.’ ”53
Louisiana’s problems could serve as a warning to the nation, Barr
argued. Organization of conservatives was the key. “We were in the
majority,” he told Byrd, referring to conservatives in Louisiana, “but thor-
oughly disorganized.” Barr and other business conservatives believed that
proper organizational backing, together with the right messenger, would
bring out the American people’s true conservative nature. Barr could not
see how the New Deal or liberalism appealed to southern workers and
the electorate at large. Operating on such assumptions, Barr hoped to
facilitate conservatives’ political and policy preferences by manipulating
the back rooms of power.54
As southern business conservatives planned their strategy to alter
the political field, they faced a tactical decision: promote a conserva-
tive takeover of the Democratic Party or pursue a third-party challenge.
Barr prioritized the cultivation of a conservative leader, whether by
reclaiming the Democratic Party, in forming a third party, or by run-
ning a coalition ticket of conservatives from both parties. Barr and John
W. Breyfogle of The Security News in Topeka, Kansas (the newsletter of
a local fraternal-aid society) discussed the idea for a coalition ticket in
mid-1943. Breyfogle was active in Republican Party politics, and though
he would not publicly support Byrd, in private he discussed running Byrd
as the Republican candidate, particularly when Willkie seemed the likely
choice. Barr, Arnold, and the Draft-Byrd supporters knew they had no
hope of thwarting Roosevelt’s nomination and could muster only a sym-
bolic protest vote.55
John U. Barr to Harry Byrd, 14 July 1944, Harry F. Byrd Papers, 171; Lurtz and Peoples,
53
Earl K. Long, 113.
Barr to Byrd, 14 July 1944.
54
John U. Barr to James M. Thomson, 20 October 1943; John W. Breyfogle to James
55
M. Thomson, 11 August, 13, 21 September, 4, 19 October 1943; A. B. Freeman to James

32
With a leader identified, Barr cited lack of finances in his decision

to focus on reorganizing the Democratic Party along conservative lines
rather than organizing a third party. The Draft-Byrd committee can-
vassed a large number of newspapers to test the waters for a coalition
ticket with Byrd as the Republican candidate. Most responded that it
was too early, that Byrd was too much an unknown to run as a national
candidate, and that southern Democrats might consider running a second
ticket to challenge the national party. In 1944, Barr contented himself
with the possibility that his efforts would weaken New Deal support
among Democrats and perhaps throw the 1944 presidential election into
the House of Representatives.56
At the Democratic convention in Chicago that summer, Louisiana,
Mississippi, Virginia, and the faction known as the Texas “Regulars” sup-
ported Byrd. The Texas Regulars were a group of oilmen and politicians
that included Eugene B. Germany, a politically active Dallas oilman who
had run John Nance Garner’s bid for the presidency in 1940. Germany
and the Regulars resented unionization and the Supreme Court’s 1944
decision in Smith v. Allwright, outlawing the Democratic Party’s all-white
primary. Above all, these oil magnates railed against federal control of
oil-rich lands, and this animated their support for Byrd. The Regulars
dominated the state-level convention and went to the national gathering
determined to secure a conservative candidate. Mrs. Fred T. Nooney, wife
of a construction company owner and a Florida delegation member, pre-
sented Byrd’s name for nomination. In her speech, she named Byrd as the
lone defender of true democracy. Ruth Nooney hailed from Jacksonville,
an urban stronghold of SSIC support that had been the site of several
annual SSIC conferences. In the final count, Byrd received 89 votes to
Roosevelt’s 1,086. Virginia delegates pledged all their electors to Byrd,
and he received a smattering of votes from Florida, Mississippi, South
Carolina, and Alabama.57
The Draft- Byrd-
for-
President movement failed in challenging the
unprecedented fourth nomination of FDR. The Republicans nominated
M. Thomson, 5 October 1943 in Byrd for President Papers re: Thomson, James M.,
Harry F. Byrd Papers, 171. Regarding the response of newspapers to the coalition ticket,
A. W. Grant to James M. Thomson, 14 July 1943 in Byrd for President re: Thomson,
James M., Harry F. Byrd Papers, 171.
Barr to Grinalds, 30 August 1944; Heinemann, Harry Byrd of Virginia, 237–239; John
56
U. Barr to Charles Hall Davis, 5 August 1944, Harry F. Byrd Papers, 171.

See Leuchtenburg, The White House Looks South, 135; Grantham, The Life & Death
57
of the Solid South, 118. Official Report of the Proceedings of the Democratic National
Convention and Committee (National Document Publishers, 1952), 170.
4
3
2
New York Governor Thomas E. Dewey` who ran on an anti–New Deal

platform and was resoundingly defeated by Roosevelt. Although south-
ern conservatives had failed in their challenge to Roosevelt, several fac-
tors provided hope. Barr’s words to a meeting of Byrd-drafters contained
a new resolve:
The Southern States are no longer willing to play stooge for elected Democrats
who attempt to use our party regularity as the means of delivering our party and
country to alien borers from within who seek to capture control for a continua-
tion and enlargement of their diabolically un-American purpose. These minority
groups overplayed their hand and over-looked the fact that we of the South were
American first and Democrat second … The crack-pots and bureaucrats are
doing the revolting [from the Party] because we insist upon them starting their
own party and running as the communists and race inciters they really are.58
Barr hoped that labor and New Deal supporters would simply leave the
party rather than his having to form his own third, conservative party.
The New Orleans manufacturer would continue to fail in finding pur-
chase for his states’-rights allies in politics. In 1948, the flamboyant Earl
K. Long, son and political heir of the legendary Huey Long, would unseat
Barr’s candidate, Governor Jones. Barr’s stewarding of the States’ Rights
Party, also known as the Dixiecrats, in the state that same year would
also fail to meet his expectations. Nevertheless, Barr’s words signaled an
important shift in the SSIC’s political activism. His statement, that south-
erners must act as Americans first and Democrats second, reflected not
only manufacturers’ declining allegiance to party but also SSIC leaders’
realization that they had to seek issues that could build support at the
national level. In short, they needed non-southern allies.59
Yet southern manufacturers’ litmus test of support segregation meant
they could not turn to prominent Republicans, as much as they admired
many, such as Robert Taft of Ohio. In 1947, Gus Dyer appreciated the
John U. Barr, press release, Draft Byrd for President Campaign, 1 June 1944, Harry
58
F. Byrd Papers, 171. Byrd’s supporters cited Theodore Bilbo of Mississippi as the kind of
Democrat not to emulate. The fiery senator gained infamy for his racist and anti-Semitic
comments, but he often voted for reform. One Mississippi Senator Byrd-for-President
Club member wrote Josiah Bailey, “Do the better element [whites] in the South the kind-
ness not to mention a gentleman like Senator Byrd in the same breath with Roosevelt!
I am sure you don’t want to be the ‘Bilbo’ of North Carolina.” John Gibson to Josiah
Bailey, 6 April 1944, Josiah Bailey Papers, 478. Thurman Sensing maintained a personal
relationship with Senator Bilbo based on their shared antipathy toward desegregation.
Thurman Sensing, Jr., personal interview, Nashville, TN, 21 March 2008.
Lurtz and Peoples, Earl K. Long, 148–150. Barr would go on to chair the Federation
59
for Constitutional Government based in New Orleans. “Federation for Constitutional

Government,” 16 June 1960, Campaign Materials, 1956– 1970; Burns, Haydon,

5
3
2
conservative coalition’s power in Congress and how southern Democrats

“lined up” with Republicans on certain issues. But Dyer distrusted these
alliances. Republicans, he alleged, did not truly stand with the South and
its principles. “They rail at the South for voting solid,” he declared, “yet
they have never done anything that would justify the South in voting
any other way.” Republicans supported the FEPC in large numbers, he
explained, and the party “should by no means be accepted, certainly not
by the South, as assurance of peace, prosperity, and Constitutional gov-
ernment.” Several SSIC leaders praised Republicans for their ideological
consistency regarding civil rights, indicating southerners still looked upon
the GOP as the Party of Lincoln. Republicans’ dedication to equal rights
proved an obstacle to bringing the party southward, no matter how much
congruence existed between southern conservatives and Republicans on
economic issues.60
In 1944, southern industrialists vastly preferred Roosevelt’s choice of
Harry Truman as the vice presidential candidate over Henry Wallace, but
once the former Missouri senator succeeded Roosevelt as president, the
SSIC declared him an enemy equal with FDR and even Wallace. Senator.
R. Kirby Longino protested in his Bulletin column after Truman’s 1948
State of the Union address, in which the president introduced his civil
rights program: “The President not only ‘veered a little to the left,’ he ‘out
Wallaced Wallace’ in attempting to stave off political opposition from the
former vice president.” Truman’s Fair Deal promised more of the same
“dangerous” proposals, he surmised, motivated by a Democratic Party
dominated by groups that these politically active southern industrialists
abhorred. Longino explained that Truman “recommends a program of
collectivism and centralization of power that portends a straight-out
socialist state. He recommends public housing, federalized medicine, fed-
eral financial aids to education, a permanent FEPC, extension of rent
controls, increase of minimum wage to seventy-five cents an hour, price
controls and rationing, and continuation of subsidies. This is unadulter-
ated socialism.” Longino went on to describe Truman’s plans for a tax
credit for individuals and dependents as a way to “soak the rich” and as
a ploy to secure voters for the 1948 election. These issues defined SSIC
activism against Truman; his support of civil rights was the least of their
SubSERIES 2b: Campaign for Governor, 1960 Box: 8; C. Farris Bryant Papers, Special
and Area Studies Collections, George A. Smathers Libraries, University of Florida,
Gainesville, Florida. Box 8. Available online, http://ufdc.ufl.edu/UF00083572/00001.
Gus Dyer, “Complacency Would Be Criminal,” News Bulletin, No. 5, 1 January 1947,
60

6
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2
concerns. Maintaining southern wage structures and autonomy from

federal oversight, industrialists reasoned, would maintain segregation
more effectively than blocking one more federal program.61
During 1948, SSIC leaders remained dedicated to the conservative
arguments on which their organization based its reputation –and which
were the primary motivation for their support of the States’ Rights Party.
Southern manufacturers interpreted Democratic support of civil rights
measures, particularly the FEPC, as evidence that the party had aban-
doned economic principles in favor of minorities and political goals. J. H.
Ballew, SSIC junior counsel and former Tennessee state senator, attended
the Democratic National Convention in Philadelphia as an elector-at-
large. He relayed convention details to the Board of Directors, describing
the various fights on the floor over states’ rights and the civil rights plank
submitted by Senator Hubert Humphrey of Minnesota. Ballew editori-
alized in his report of Truman’s nomination and the selection of Senate
Minority Leader Alben Barkley of Kentucky as running mate, calling
the move “a clear-cut victory for the ultraliberal group and the big city
bosses.”62
Democrats’ positions on economic issues drew Ballew’s scrutiny. When
it came to the party platform, Ballew focused on the SSIC’s core economic
concerns and protested “a plank calling for an intensive enforcement of
antitrust laws” while also noting that the platform “pledges a positive
program to promote competitive business and, in a general way, supports
the right of free enterprise.” Ballew interpreted the Democratic platform
as benign in appearance but that it threatened the free market, which he
interpreted as evidence of communist infiltration. For Ballew and other
SSIC members, Truman’s domestic program, civil rights, and other fed-
eral aid could not be squared with a platform that claimed to endorse free
enterprise. Members did not want to see a political victory for civil rights,
even if their central concerns had been paid lip service in the platform.
Yet civil rights was not a straightforward litmus test; rather, it had been
incorporated within a framework of issues that could be considered mat-
ters of “free enterprise.” SSIC leaders believed that their overall program
for limited government –a truly conservative agenda –would eliminate
civil rights gains while allowing a more beneficial political economy for
Longino described the proposed $40 tax credit as “reminiscent of another effort that was
61
made to secure the voters –then it was ‘Forty acres and a mule’ –now it is ‘Forty dollars
and a mule.’ ” R. Kirby Longino, “The State of the Union” News Bulletin, No. 30, 15
January 1948, SSIC Papers Box 5, Folder 3.
J. H. Ballew to SSIC Board of Directors, 16 July 1948, SSIC Papers Box 6, Folder 1.
62

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southern industry, free of federal controls. States’ rights included more

than defense of racial segregation; for southern industrialists, it would
preserve the South’s labor structure and economic future.63
In 1948, the States’ Rights Democratic Party held its first and only
convention in Birmingham, Alabama, and nominated South Carolina’s
Governor Strom Thurmond as its presidential candidate. Thurmond had
not appeared in any SSIC lists of possible future political leaders, either
for the South or for conservatives. As governor he had led as a moderate
liberal; although he favored economic development to address problems
of inequality, his support of Roosevelt and the New Deal had disqualified
him from notice. Yet SSIC industrialists, including cofounder and for-
mer vice president Donald Comer, emerged as strong supporters of the
Dixiecrat movement in the Deep South. Business and industrial support
for the third party reflected the desire for an alternative to a Democratic
Party dominated by New Deal policies and civil rights –whether one
complaint ranked above the other remained unclear, depending on indi-
viduals’ varying priorities.64
In the end, for the SSIC, neither the Democrats nor the Republicans
offered a viable conservative alternative in 1948, and the Dixiecrats reg-
istered only a feeble protest. The SSIC’s president believed both parties
were equally likely to “betray” the South on civil rights. That summer, the
president signed Executive Orders 9980 and 9981, integrating the federal
workforce and desegregating the armed forces. SSIC leaders and other
opponents labeled these “Force Bills,” summoning the embellished ghosts
of Reconstruction. Even if Truman softened the platform on civil rights
to preserve the fractured Democratic Party, his earlier State of the Union
speech and his support for the New Deal had already alienated south-
ern manufacturers from the president. SSIC president R. Kirby Longino
argued that the Democrats were persuaded by labor to attack Taft-
Hartley; special interests controlled the platform and the party lacked any
consistency. Republicans fared better among industrialists on economics.
Longino suggested that the Republican platform offered more benefi-
cial planks for business. He noted that the platform contained a “pledge
of fiscal policies to provide increased incentives for production and
Ibid. SSIC Declarations of Policy, 1952–1958, SSIC Papers Box 2, Folder 3.

63
Thurmond, as governor, supported rolling back the poll tax, stronger prosecution of
64
lynchers, and desegregation of interstate transportation, among other proposals. In

the 1960s, he would become a strong SSIC supporter during his political transition
to the Republican Party. Frederickson, The Dixiecrat Revolt and the End of the Solid
South, 1–4.
8
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2
thrift” promised small businesses to limit “competition by government

organizations.” Neither party appeared to be the defender of free enter-
prise, in all its connotations, that southern manufacturers desired.65
With such assessments, Longino concluded that it was not yet time
for the SSIC to join the political fray. With Taft-Hartley secured, little
more could be gained by working with the leadership of any party. He
advised the SSIC members that business leaders should “keep our powder
dry” and “fight our own battles.” Southern industrialists interested in pre-
serving low wages learned an important lesson, however: segregationist
arguments alone would not secure their economic policy preferences. In
fact, highlighting the racial issue precluded their ability to form alliances
with other business groups in search of a similar political economy. In
the end, the Dixiecrats failed to obtain the 127 electoral votes needed to
throw the 1948 presidential election into the House of Representatives –
Alabama, Louisiana, Mississippi, and South Carolina alone supported
the Thurmond-Wright ticket.66
The States’ Rights Democratic Party never represented SSIC leaders’
vision for a conservative alternative despite support among business lead-
ers. For SSIC leaders, sectional concerns dominated the Dixiecrat move-
ment; it was too mired in the politics and populism of the past. Industrial
leaders in the SSIC, even John U. Barr and Donald Comer, who sup-
ported the Thurmond ticket, wanted a viable political alternative with
national appeal. The SSIC, although it had many members who were
strong Dixiecrat supporters, kept the movement at arm’s length. Of the
third party’s prominent supporters, only Barr had strong SSIC ties. The
Dixiecrats’ muddled extrapolation of white supremacy into positions
syncretic with modern conservatism failed.67
Thurman Sensing, the SSIC’s director of public relations, concluded
that the South’s break with the Democratic Party was a positive develop-
ment for the region and for the nation. He did not see the States’ Rights
Party as a logical step for the political system, but he predicted that a
political realignment would result from the 1948 election. He explained,
“Whatever the names those two major parties adopt, we can be quite
certain that the one will believe in individual freedom, the other in state
planning; the one will believe in states’ rights, the other in centralized
William C. Berman, The Politics of Civil Rights in the Truman Administration (Columbus:
65
Ohio State University Press, 1970), 8. Longino to SSIC constituency, “Keep Your Powder
Dry,” 2 August 1948, SSIC Papers Box 6, Folder 2.
Ibid.
66
Ibid. Crespino, Strom Thurmond’s America, 79–80; 84.

67

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Conclusion 239
government; the one will seek to preserve our constitutional republic, the
other will lead to some form of totalitarianism, call it socialism, commu-
nism, or ‘what-have-you.’ ” Sensing celebrated the potential creation of
a two-party South as a boon for southern industry and free enterprise.68
By 1948, although SSIC leaders continued to invoke the South’s unique
past, their underlying goals and priorities had undergone a subtle, but
significant, transformation. The SSIC increasingly emphasized economic
and ideological arguments and converted sectional defensiveness to serve
national concerns. Because the South was a bulwark of democracy, in the
SSIC’s definition, its influence in a national party would yield beneficial
results for the region and the nation.
Conclusion
In 1952, Herman Edelberg, a representative of the Anti- Defamation
League, commented before a Senate subcommittee that “Mr. Southern
Democrat,” Richard Russell, Jr., had changed his tone on the FEPC.
Edelberg hoped that some southerners had been convinced to accept
some form of the FEPC, at least in an “educational” capacity. Russell,
Edelberg remarked, “is not saying the kind of things that southern
Senators were saying 10 years ago, particularly when he is on a national
program.” Even if the longtime senator from Georgia still railed against
the “Communist-Socialist FEPC” in front of “certain kinds” of audiences
in Florida, when campaigning for the state’s 1952 presidential primary,
the senator seemed more interested in national issues than in race-
baiting. Edelberg and Senator Hubert Humphrey had a brief exchange
over the pejorative connotations of the term “compulsory” when applied
to the FEPC, but Edelberg nonetheless surmised that even Mr. Southern
Democrat might have “finally come around to the view that it would not
be a fate worse than death” to accept some kind of federal oversight on
equality in hiring.69
Edelberg’s hopes, if perhaps unfounded, reflected the moderation in
rhetoric among southern business leaders in the course of the 1940s.
Southern business conservatives acknowledged that they had to temper
68 Thurman Sensing, “Southern Politics,” SSIC Press Release No. 223, 31 October 1948,
Herman Edelberg, Discrimination and Full Utilization of Manpower Resources: Hearings
69
Before the Subcommittee on Labor and Labor-Management Relations of the Committee

on Labor and Public Welfare United States Senate, 82nd Congress, 2nd Sess., on S. 1732
and S. 551 (Washington, DC: GPO, 1952), 318.
0
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their words for national audiences and seek new allies. The 1948 election
convinced them that they had to avoid alliances that would promote a
damaging image of the South as backward and reactionary. Still, business
conservatives’ political networks remained linked to the anti–civil rights
agenda and the sentiments of the many remaining “Misters Southern
Democrat.”
Representative John E. Rankin of Mississippi, a notorious racist who
had refused to sit next to his fellow congressman, Adam Clayton Powell
Jr., because he was black, uttered racial epithets on the floor of Congress.
Rankin revealed his hopes that party realignment would take place if the
election hung. He reasoned that Thurmond would become president “for
the simple reason that every Republican would rather have Governor
Thurmond than President Truman, and every real Democrat would rather
have Governor Thurmond than Mr. Dewey.” Critics cited Rankin as the
prime example that the States Rights Party was “filled by small-minded,
backward-looking Negro haters.” Such critics were correct that it was
“the same economic conservatives in the region who had been looking
for a foothold” against New Deal liberalism who backed the Dixiecrats,
but they did so because of what they saw as the lack of alternatives.70
For southern manufacturers, allies such as Rankin were problematic
not just for their overt bigotry but for their policy stances. Rankin had
been a strong supporter of the TVA and rural electrification. Even if many
shared Rankin’s racist views, as well as his assumption that Thurmond
had broad support, manufacturers felt they had to tread carefully in
public while also convincing southern politicians that existing industries
held the key to economic prosperity. Turning back federal intervention
in minimum wages, unionization, and promotion of economic develop-
ment through incentives and tax reductions, SSIC leaders argued, would
help fight fair employment practices and preserve segregation. Business
required political stability and policy influence; the South had to moder-
ate and modify its rhetoric to build national allegiances.
The 1950 midterm elections saw the defeat of several prominent
southern liberals, such as Claude Pepper in Florida. The GOP made
several inroads in the South, bolstered by Old Guard Republicans in
Congress, best represented by Senator Robert Taft. In 1952, Eisenhower,
John Rankin, 6 August 1948; Adam Clayton Powell Jr., Adam by Adam: The
70
Autobiography of Adam Clayton Powell, Jr. (1971 reprt., New York: Kensington Books,

2002) 73; Crespino, Strom Thurmond’s America, 77. Numan Bartley noted that business
led the Dixiecrat movement and supported economic issues alongside preserving the
racial status quo. Bartley, The New South, 1945–1980, 83.

1
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Conclusion 241
even with his moderate internationalism, won outer southern states and
drew the support of many business leaders in the SSIC, who preferred Ike
to the “egghead” Stevenson, after Russell failed to secure the Democrats’
nomination. The SSIC attempted –with some success –to apply their
economic and political arguments, honed during the New Deal to the
FEPC and labor reform. Nevertheless, southern industrialists’ allegiance
to racist employment practices –for all the lip service to the right to work
and fairness in the workplace –slowed the emergence of a two-party
South and a functional conservative coalition that southern manufactur-
ers clearly desired. SSIC leaders grew increasingly aware of this limitation
and attempted to highlight shared economic interests across regions.
This realization reflected the rising sentiment among business lead-
ers in the 1950s and 1960s that racial discord was bad for business. In
1960, a political scientist observed, “Like the Manufacturers’ Record, the
[SSIC’s] Bulletin avoids discussions of race relations lest the thought of
racial discord discourage industry from moving southward.” Southern
business leaders realized in 1948 that a successful national political bid
for economic conservatism, balanced budgets, and a low-tax, limited reg-
ulatory environment could not be forged with race at the center. Business
activists avoided mentioning the race issue not only for economic reasons
but for political ones as well. As business leaders “kept their powder dry”
on political matters, they appeared to lack political animus in the 1950s.
Yet the activity within business circles belied this image. Southern indus-
trialists were developing political connections and building the rhetorical
arsenal necessary to bridge the gaps among conservatives.71
SSIC leaders deplored the Supreme Court’s decision in Brown v. Board
of Education in 1954, the Civil Rights Act of 1958, and the rescind-
ing of the poll tax, but they avoided allowing these issues to dominate
their commentary or activism. If a larger plan for states’ rights succeeded,
local control in both right-to-work and segregation would be maintained.
The SSIC’s conservatism developed in response to the decline of mill-
village paternalism and the desire to maintain low wages. This occurred
under the influence of free-market economic theory; it did not emerge
Grantham, The Life & Death of the Solid South, 125–126; Marian D. Irish, “Political
71
Thought and Political Behavior in the South,” The Western Political Quarterly 13, no.
2 (June 1960) 409. Southern manufacturers saw no fundamental dissonance in paint-
ing the South as a haven of individual rights while defending segregation. As historian
Jason Morgan Ward demonstrates, the SSIC reflected the widely accepted notion among
white southerners that “modernization and segregation seemed neither incompatible nor
antagonistic.” Ward, Defending White Democracy, 95–97.
2
4
as a component of massive resistance to desegregation. Not surprisingly,

therefore, industrialists’ unity on segregation failed to produce a mean-
ingful political alternative. For SSIC leaders, useful and functional coa-
litions with conservative or isolationist Republicans would come from
activism on economic issues, and their embrace of libertarian econom-
ics, support for traditionalist values, and the critique of internationalism,
especially foreign aid and the United Nations. In the course of crafting
these positions, Dixie industrialists expanded their most important audi-
ence beyond southern politicians to other conservatives, both southern
and non-southern.

3
4
2
Downplaying Dixie
The political and policy battles of the 1940s led manufacturers to

transform their idea of the South. A more flexible, ideological defini-
tion of the region opened opportunities for fusion with individuals and
groups previously precluded by the SSIC’s rigid, geographic, cultural, and
socioeconomic boundaries of “Dixie.” The idea of a continuous southern
tradition had proved fraught with contradiction, bound up in a near-
century of attempts to claim its mantle. For self-appointed representatives
of southern distinctiveness and culture, particularly from an economic
perspective, the ideological recasting of the South as a free enterprise
zone furthered the decline of the idea of the New South and southern
economic exceptionalism. Nevertheless, the SSIC’s view of the South’s
traditions, blended with defenses of free markets and capitalism, super-
seded the views of traditionalist critics of industrialism in the region. In
the aftermath of World War II, the southern business community crafted
a modern southern conservatism that embraced capitalism and industrial
development.1
Fostering this development, the region’s changing economy and polit-
ical climate diversified SSIC membership, particularly as shifts in global
capital reshaped the region. Contributions from large corporations
with southern plants increased, reshaping the SSIC’s activism. Southern
1 Although Agrarianism belonged among the ranks of antimodernist intellectuals in the

twentieth century, John Langdale argues, it ceased to be “influential in the evolution of the
modern American right.” Even with this broader influence muted, Langdale asserts that
Agrarians left a strong legacy of cultural conservatism while revealing tensions between
movement insiders and traditionalist intellectuals. Langdale, Superfluous Southerners, 16,
49, 74.
243
42
244 Downplaying Dixie
business leaders resisted desegregation but downplayed racial politics in

favor of economic development. New “Whigs” sought increased federal
defense spending in the region and pursued public policy to lure capi-
tal investment. SSIC leaders looked beyond state-level policies promot-
ing economic growth and defense spending, and views on desegregation
continued to vary from member to member. Though the organization’s
members often typified this emerging group, they supported the SSIC to
promote federal-level policies that would attract investment in the South.
Motivated by free-market ideology and their vision for national political
economy, the SSIC wanted a two-party South, and its leaders tried to
spark a grassroots movement to this end.2
Inspired by Friedrich Hayek, the movement’s leaders sought to con-
vince “opinion makers” and the general public to support their vision of
economic development. Their efforts complemented the emergence of a
network of conservative organizations in the 1950s. For manufacturers,
preserving the South’s low wages remained central amid increasing eco-
nomic dynamism. Shiny new factories making defense-related products
were welcome, but the SSIC’s members also tasked the organization with
preserving existing industry and the low wages and un-unionized labor
that attracted plants from companies such as General Electric, Chrysler,
and Firestone.
Although cultural traditionalists proved increasingly less essential to the
emerging conservative movement, allies such as the last-standing Agrarian
Donald Davidson expedited important organizational links among intel-
lectuals, movement leaders, and business groups. Davidson, by the 1950s,
was the remaining Agrarian and traditionalist defender, the others having
moved on in their intellectual pursuits and ideological allegiances, particu-
larly regarding segregation, and Davidson worked to resurrect his antistat-
ist writings of the 1930s for new audiences. Former adversaries converged,
particularly around issues of foreign relations and international trade. New
allies for the SSIC emerged on both political and cultural fronts in the
1950s, and these networks served to further nationalize the organization.
With new allies and new goals, the SSIC, with the cooperation of southern
cultural traditionalists and industrialists, facilitated the nationalization of
the modern conservative movement and helped bring the South into con-
versations about a conservative realignment.
2 Southern demagogues like Georgia’s Eugene Talmadge, whose politics were born of the
dirt farm and the demagoguery, were displaced by politicians like Ellis Arnall, who privi-
leged economic prosperity as the salve for the region’s persistent poverty and racial poli-
tics. Schulman, From Cotton Belt to Sunbelt, 128–134.

5
4
2
Public Relations after Hayek 245
The South, these manufacturers posited, was no longer unique and

separate; it had become rhetorically, politically, and economically inte-
gral to the preservation of national values, character, and prosperity. The
New Deal prompted southern manufacturers to embrace a language of
free enterprise, and the evolution of the Cold War after 1947 gave these
arguments added meaning and significance. Challenges to small and
medium-sized manufacturers from increasing imports of cheap manu-
factured goods from Asia added pressure to create cross-regional conser-
vative ties. By the 1950s, the SSIC’s invocation of free enterprise became
consistent and coherent, without the compromises of past policy battles.
The Sunbelt and a refashioned politics to accompany it were emerging,
eclipsing the political strategies espoused by the New South industrial
elite of just a few years earlier.
Public Relations after Hayek

The SSIC’s reimagined public relations role stemmed from a 1948 meet-
ing in London between SSIC Public Relations Director Thurman Sensing
and economist Friedrich Hayek. Sensing traveled to Great Britain to cat-
alog the ill-effects of the emerging social democratic welfare state. As part
of his agenda, Sensing interviewed British politicians and business lead-
ers. He also met with Hayek, who had published The Road to Serfdom
in 1944. Hayek’s writings and speeches had a marked effect on the ener-
getic young SSIC spokesman, who likely first encountered the ideas in
the altered Reader’s Digest format or in a pamphlet distributed by the
NAM. Indeed, Sensing epitomized the kind of reactionary reader whom
Hayek resented –someone who failed to see the warnings and caveats
in the economist’s full work. Sensing seized upon Hayek’s contention
that nations, despite good intentions, inadvertently allowed centraliza-
tion to take over economies and undermine the system of free enterprise,
eventually leading countries down the “road to serfdom.” Great Britain,
in Sensing’s estimation, provided evidence of the results that the United
States could expect, should it continue certain policies.3
Sensing incorporated the lessons he gleaned from Hayek into his sense
of mission. The SSIC’s trend toward coherent invocations of free enter-
prise across policy areas grew stronger with Hayek’s guidance, and the
SSIC’s operations expanded in new directions. Hayek recommended that
3 Burgin, The Great Persuasion, 90. Sensing to Officers and Directors of the SSIC, 23 May
6
4
2
Sensing educate society’s “opinion makers” on free enterprise so that they

would act as the “moulders” of public opinion. Hayek contended that
it was wasteful to attempt to “educate the masses” when so much of
public opinion was shaped by “high brow” writers who embraced social-
ism. Sensing was pleased to report that “I told [Hayek] I had made this
same comment three years ago as concerns our own Southern region.”
He explained to Hayek that the SSIC had trouble getting the “the real
Southern viewpoint printed” in national newspapers and magazines and
that the only southerners who received Pulitzer prizes were “those who
attacked the fundamental Southern beliefs in local self-government and
individual freedom.” According to Sensing, Hayek responded that the
SSIC must develop its own educational program and convert “leaders
in thought,” such as writers and speakers who reached “the masses,” to
accomplish the common goal of spreading support for free enterprise.
Instead, the economist advised Sensing to “look at your newspaper edi-
tors, your commentators on radio and television, your authors, your book
review editors, and others in like position, and see whether they favor the
free enterprise system or are opposed to it.” Hayek suggested that Sensing
assess how these writers might be influencing the public, then work from
there. Upon returning home from London, Sensing began implementing
this plan.4
The first step in the program was to convince “opinion makers” of the
validity of SSIC positions. In 1949, Sensing concluded that public rela-
tions were “practically the sum and substance of what the council exists
for,” but the organization’s primary mission was not to talk directly to
the public. Instead, the SSIC had to work through intermediaries. Sensing
wanted to change “attitudes” among the American people and to build a
conservative grassroots movement, but he continued to set his sights on
promoting the South’s prosperity. Sensing declared that the council had
to inspire the country’s leaders to stop the spread of communism, and
they in turn could influence the public.5
Sensing’s trip to Britain also accompanied conservatives’ wariness of
providing aid to European countries, signing defense over to an interna-
tional alliance, consigning warmaking to president, while also committing
American dollars to an ever-expanding and expensive garrison state. The
4 Ibid.
5 Thurman Sensing, “The Public Relations Aspects of the Southern States Industrial
Council,” Report for Annual Meeting of the Board of Directors, 24–25 January 1949,
SSIC Papers Box 6, Folder 1. Thurman Sensing, Annual Report, Board of Directors
Meeting Minutes, 14 May 1959, SSIC Papers Box 2, Folder 3.

7
4
2
SSIC’s message also capitalized on Cold War tensions in the early 1950s,
when other business organizations, most prominently the NAM, produced
public relations blitzes heralding free enterprise as the best defense against
communism. The council’s objectives for 1950 demonstrated the leaders’
belief that the country had already taken disastrous steps toward social-
ism. The SSIC’s objective to “restore and preserve our Constitutional form
of Government” also required that those who furthered this goal first and
foremost prove allegiance to “God and Freedom –not Security.” Council
leaders assumed that only free enterprise and dedication to religious prin-
ciples could stem the tide of socialism sweeping the country. Truman’s Fair
Deal, SSIC spokesmen pontificated in various publications, would destroy
freedom, as well as the worth and dignity of the individual.6
In 1950, the SSIC proclaimed its mission to preserve the “moral and
spiritual values” at the heart of Western civilization against the ravages
of socialism. The organization existed on the rightward end of anticom-
munist crusades in the midst of the Red Scare of the early 1950s. SSIC
leaders mirrored the era’s most hyperbolic and hysterical pronounce-
ments about the dangers of socialism. Such rhetoric was not new to the
SSIC, although its scope and purpose had been broadened by Cold War
tensions. In 1935, SSIC founder John Edgerton had declared the council
unwilling to trade specifically southern “moral and spiritual values” for
prosperity. The challenges of the post–World War II political landscape
included threats that seemingly dwarfed the New Deal. The evils replac-
ing the New Deal included “confiscatory” tax levels, an exploding federal
deficit, strikes, class and racial divisions, the absence of right-to-work laws
in many states, labor monopolies, bribes masked as subsidies, the United
Nations’ usurping of Congress’s treaty-making role, and the lack of a
“realistic, consistent, comprehensible policy versus communism.” More
than a reflection of rhetorical change, this redefined mission required new
tactics for the organization in light of rising Cold War tensions.7
6 See Elizabeth Fones-Wolf, Selling Free Enterprise; Wall, Inventing the “American Way.”
“1950 Objectives of the Southern States Industrial Council: Implementing the Educational
Program Socialism versus Freedom,” SSIC Papers Box 6, Folder 3.
7 Thurman Sensing remained the most ardent defender of keeping the term “industrial”
in the organization’s name. In 1961, the proposal to change the name to the “Southern
States Council” or the “Southern States Economic Council” surfaced again, and Sensing
protested, citing the suggestion from ten years earlier, and he justified the title’s con-
tinuation because of the reputation the organization had built. Executive Committee
Meeting Minutes, 29 May 1961; “1950 Objectives of the Southern States Industrial
Council: Implementing the Educational Program Socialism versus Freedom,” SSIC pam-
phlet, SSIC Papers Box 2, Folder 3.
8
4
2
A clearer national purpose and expanded public relations did not

immediately translate into additional funding for the SSIC. In the late
1940s, financial difficulties plagued the council, which had amassed large
debts. Its membership base shifted as well; donations decreased and the
council’s board of directors cultivated new supporters. Mergers of mem-
ber firms meant declining support from traditional New South industrial
sectors. Yet it took time to recruit the diversified interests of the “new”
New South. Furthermore, educational programs required additional
funds and put the SSIC in competition with other business organizations.
In 1951, the NAM pursued a capital campaign to raise $5 million, a vast
sum compared with the SSIC’s roughly $90,000 operating budget. Still,
the SSIC remained the fourteenth-largest lobby by spending in 1952, only
four spots behind the U.S. Chamber of Commerce and seven behind the
American Legion. The NAM did not file financial statements.8
Thurman Sensing appealed to the SSIC Executive Committee not to
think of competing with the NAM or the chamber when it came to public
presence and advocated keeping the SSIC’s operations nimble and effi-
cient. He recommended an expansion in public relations efforts through
published materials. The SSIC published out a variety of materials,
including the Bulletin, reprints of Sensing’s “Down South” column, and
various speeches and mailings targeting specific groups. Between January
and May of 1951, the SSIC sent 86,340 pieces of mail, in addition to
regular correspondence and membership solicitations.9
These mailings, Sensing contended, helped “mold the opinion of those
who mold opinion.” He targeted political leaders who could include mate-
rial in speeches, business owners who could include pamphlets in employees’
paychecks, newspaper editors who could use SSIC writings as inspiration
for editorials, and transit stations and other businesses that could leave
circulars for patrons to read in waiting rooms. Of the 5,000 copies of the
Bulletin printed in 1951, 1,000 went to the Southern Railway, 181 to south-
ern Congress members, 214 to editors for member firms’ in house newslet-
ters, and 800 to individuals on the mailing list, with the balance sent out
for “good will” purposes. Receivers of these last copies included secretaries
of state-level manufacturing associations and chambers of commerce, as
8 “Lobby Spending Plunges,” CQ Almanac 1953, 9th ed., 10-578-10-580 (Washington,

DC: Congressional Quarterly, 1954), http://library.cqpress.com/cqalmanac/cqal53-
1365434. Congressional Quarterly reported that the SSIC spent $83,883.56, but not
all of these funds were for legislative purposes. Thurman Sensing, Annual Report to
Executive Committee Meeting, 7 May 1951, SSIC Papers Box 2, Folder 1.
9 Ibid.

9
4
2
well as bottling, banking, farm bureau, and trade associations, groups to

whom the SSIC’s message might appeal. Other copies became enclosures in
solicitation and membership-appeal letters.10
Sensing targeted national audiences. He recommended adding all mem-
bers of Congress, not just southern ones, to the “good will” list, as well as
all college presidents. In particular, he suggested a $3,000 increase in funds
to support a teacher-preacher outreach, hoping to reach schoolchildren
and church congregations with the SSIC’s message of free enterprise. He
proposed a $10,000 budget increase for the SSIC publicity office to sup-
port more writing and speaking appearances. Publicity, including printing
and postage, consistently accounted for between 20 percent and 30 percent
of the SSIC’s operating budget. The budget also expanded with increases in
special programming aimed at specific groups. Not only did Sensing want
to reach a wider audience external to the South, but he and other council
leaders also targeted educators as key “molders” of public opinion. Such
efforts reflected ongoing “educational” campaigns undertaken by lobbying
groups from business and other interests, including the American Medical
Association’s attempts to block nationalized health care.11
Within the expanded public relations effort, Thurman Sensing also
pushed to make the organization more educational in appearance. Such
a move was both practical and strategic. It would expand outreach while
disguising the political nature of the organization by labeling its works
as public service. Accordingly, the SSIC’s Education Program budget
increased from 4 percent in 1952, at its inception, to 14 percent in 1957.
Here, too, Cold War–induced paranoia threaded through the council’s
purpose. SSIC leaders argued that communists used benign-appearing
educational programs to indoctrinate America’s youth. Paul Redmond,
new SSIC president and head of Alabama Textile Mills, concluded that if
socialists went unchallenged in education, American children would be
indoctrinated “with the false philosophy of a ‘more abundant life,’ and
reliance upon government to solve all of life’s problems,” and the country
would be “socialized” in two generations.
The educational program, Redmond contended, was the SSIC’s most
“effective weapon.” SSIC representatives solicited appearances in schools
10 Sensing’s column, “Down South,” would be renamed “Sensing the News” in 1955 and
would be taken over by Anthony Harrigan and made into a radio commentary in the
1970s after Sensing’s death.
Sensing, Annual Report, 7 May 1951. The American Medical Association reported that
11
it spent $39,340.67 of its total $477,951.74 expenditures in lobbying efforts on its

National Education Campaign. “Lobby Spending Plunges.”
0
5
2
and universities, primarily in the South, and “carr[ied] the message of a

free competitive economy to thousands of young men and women.” SSIC
directors distributed transcripts of SSIC publications for broadcast on local
radio, including pamphlets such as “Washington –The Nation’s Economic
Problem No. 1,” “The South Needs No Federal Aid,” and “UNESCO
Would Destroy America.” Each such pamphlet provided an overview of
a specific issue and the SSIC’s position together with entreaties to read-
ers to contact their congressmen. In Sensing’s words, these pamphlets all
“contain[ed] in brief and readable form the truth about the worth of the
individual, the right to work –and countless other messages of the same
fundamental character.” The program corresponded to attempts by other
business organizations to promote free enterprises in the context of the
Cold War while also masking the SSIC’s larger purpose.12
SSIC leaders sought a political outcome. Their public relations efforts
supported their ultimate goal of preserving the region’s low wages and
preventing regulatory expansion through a growing a network of allies.
Above all, public relations brought SSIC leaders in closer contact with
southern intellectuals, local officials, business leaders, and other groups
who accepted the SSIC’s rebranding of the South as the nation’s No. 1
economic hope and repository of national values.
Luring Traditionalists
Thurman Sensing’s 1948 trip to Great Britain resembled that of other
conservatives who toured western Europe’s welfare states in the late
1940s and early 1950s. Russell Kirk mentioned similar visits and pro-
posed to write some “vignettes of welfare states” in 1952. Beyond this
form of “disaster tourism,” so to speak, Sensing and the SSIC partici-
pated in a growing transnational conservative movement and developed
tactics according to recommendations from the movement’s leaders and
organizations. SSIC leaders looked to public relations to build grassroots
support for their conservative message and sought to win support from
conservative intellectuals and activists.13
12 Printed materials in SSIC Papers Box 6, Folders 2, 3; Box 7, Folders 1, 2. These dis-
tributed materials frequently included Thurman Sensing’s “Down South” press releases
and articles or excerpts from the Bulletin. Paul Redmond, President’s Report, Annual
Meeting, May 13, 1954, SSIC Papers Box 2, Folder 2.
Russell Kirk to Anthony Harrigan, 7 August 1952, Box 5, Anthony H. Harrigan
13
Collection, University of Wyoming, American Heritage Center (hereafter cited as

Anthony Harrigan Collection).

1
5
2
Luring Traditionalists 251
An unlikely alliance grew in the 1950s between Agrarian and cultural

traditionalist Donald Davidson and the SSIC. In the 1930s, although the
SSIC reflected the growing regionalism generally associated with cultural
and literary figures, the organization’s vision of the South’s future had
diverged too much for industrialists and Agrarians to find common cause.
By the 1950s, Davidson, a staunch cultural traditionalist, segregationist,
and last Agrarian holdout, sought southern leaders who best understood
the challenges facing the region. Davidson’s search reflected the emerging
strategy among southern advocates in the 1950s to build a strong public
relations campaign on the visibility and rhetoric of charismatic leaders
and speakers. For SSIC leaders, such a campaign would help the orga-
nization address the region in a conservative voice, and with regionally
sensitive rationales, specifically about desegregation and economic devel-
opment. Davidson provided intellectual gravitas and cultural legitimacy
to the SSIC’s modernization-driven focus, and the SSIC provided organi-
zational backing for Davidson’s circle of supporters to demonstrate the
importance of the region to the conservative movement.14
In the postwar years, as national conservative network of intellectuals,
business leaders, and activists took shape, the SSIC fostered important orga-
nizational and social connections on which this movement could grow. For
these links to function effectively, certain intellectual and programmatic
hurdles had to be overcome. Advocates of industrial development targeted
two key groups. The first was southern traditionalists. They posed a unique
problem because many had a history of looking askance at industrial devel-
opment. Southern Democrats opposed civil rights and unions, but they
offered continued support for New Deal and Fair Deal programs that did
not interfere with southern race relations, or limited reform to suit their
racial preferences. The second group consisted of supporters of emerging
conservative and libertarian think tanks, publishing groups, and founda-
tions. Largely from outside the region, they moved in elite, intellectual social
circles that shied away from the overt racism of southern conservatives.
Davidson proved a crucial link between these two groups. For Davidson,
preserving segregation ranked first; for industrialists, segregation served
Nash’s contention that American conservatism contains three impulses –libertarianism,

14
anticommunism, and traditionalism –continues to influence scholars’ understanding of

the movement in the 1950s. George H. Nash, The Conservative Intellectual Movement
in America Since 1945 (reprt. 1976, Wilmington, DE: Intercollegiate Studies Institute,
2006). While scholars have questioned this framework, Davidson certainly represented
the traditionalist camp. Burns, “Review: In Retrospect: George Nash’s ‘The Conservative
Intellectual Movement in America since 1945.’ ”
2
5
economic prosperity. Davidson enjoyed links with other conservatives, and

he could enhance the SSIC’s reputation and network to serve their interrelated
goals. Although their visions for the South differed on occasion, the under-
lying idea of a decentralized, rurally based economy drew Davidson and the
SSIC together. As cultural traditionalists and conservatives in the South dis-
covered common ground, they were able to reach out to non-southern right-
leaning organizations to help bring the South into the modern movement.15
Strange bedfellows the Agrarian and industrialists were, they resented the
New Deal’s intervention in the southern economy equally, although for dif-
ferent reasons. In the 1930s, their visions for the South’s future could not be
married. By the 1950s, southern business and industrial conservatives orga-
nized around the SSIC-articulated libertarian principles that appealed to the
Agrarian Donald Davidson, despite his former antipathy to industrialization.
Both groups defended the South’s social hierarchy. This marriage reflected
the narrowing of the Agrarian circle and Davidson’s anti–civil rights agenda,
as well as SSIC leaders’ desire to cultivate the appearance of intellectual rigor.
Most Agrarians had abandoned the cause, leaving Davidson as its remaining
champion. With the Cold War removing his antipathy toward capitalism,
Davidson’s traditionalism meshed well with the SSIC’s antistatism, an affin-
ity reflected in the professor’s backing of the segregationist organization, the
Tennessee Federation for Constitutional Government. 16
Davidson’s use of a strict interpretation of the Constitution to resist
desegregation led him into conversations with SSIC leaders. His commit-
ment to segregation and his resistance to federal intervention on behalf
of civil rights made him amenable to the SSIC’s platform. For Thurman
Sensing, Davidson’s support confirmed that the SSIC could both promote
economic prosperity and preserve segregation. Davidson attended local
Carlton, Mill and Town in South Carolina, 1880–1920, 10–11; John Egerton, Oral
15
History Interview with Stetson Kennedy, 11 May 1990; Interview A-0354. Southern
Oral History Program Collection (#4007); Davidson to Rubin, 3 January 1955. Box 3
Folder 9, Donald Grady Davidson Papers, Jean and Alexander Heard Library, Vanderbilt
University (hereafter cited as Donald Davidson Papers, box-folder). Davidson considered
Cash’s 1941 Mind of the South to be a characterization of Dixie defined by northern
expectations. Davidson repeatedly argued that true democracy could be found by study-
ing the South and its core principles, as he wrote in Still Rebels, Still Yankees: And Other
Essays (1957; reprt., Baton Rouge: Louisiana State University Press, 1972), 211.
16 Tate to Davidson, 30 March 1937. See Justin Raimondo, Reclaiming the American
Right: The Lost Legacy of the Conservative Movement (Wilmington, DE: ISI Books,
2008). See Patrick Allitt, The Conservatives: Ideas and Personalities Throughout American
History (New Haven, CT: Yale University Press, 2009), 165–169. On Davidson’s intellec-
tual life in the 1950s, see Mark Royden Winchell, Where No Flag Flies: Donald Davidson
and the Southern Resistance (Columbia: University of Missiour Press, 2000), 337–358.

3
5
2
events with Sensing, offered advice, and connected the SSIC’s brash public
relations officer with conservative publishers and intellectuals. Sensing
and Davidson shared a mutual aversion to desegregation and federal
intervention for school integration. Yet it was more than desegregation
that brought these disparate visions together. Traditionalists and business
conservatives spoke in the same language of localism and states’ rights,
even though this language derived from divergent historical and intel-
lectual inspiration. This marriage of convenience between proponents
of southern exceptionalism extended the conservative movement south-
ward and blended the business South’s priorities with national ones.17
Davidson was rigidly attached to traditional southern social and cultural
patterns, but he reached out to national conservatives and brought the SSIC
with him. He pursued avenues for promoting his cultural traditionalism, and
he included Thurman Sensing in his list of associates. He began collaboration
with Russell Kirk and publisher Henry Regnery to found an influential south-
ern literary review magazine in 1955, Modern Age: A Quarterly Review,
which would emerge a few years later. He advised influential professor and
editor of southern literature Louis Rubin not to forget that he had allies,
“increasingly influential” ones, in the North. Davidson referred to the conser-
vative intellectuals, publishers, and writers surrounding Kirk, who could serve
as a “rallying point” for conservatives beyond those with literary interests.18
Davidson advocated regional tradition, including elevating men of let-
ters and southern culture, but he also catered to national audiences to
influence politics. Most importantly, Davidson echoed that the South was
an example for the nation, the message SSIC leaders had been pushing
in their public relations campaign. He also looked to include Thurman
Sensing in the circle of writers: here was a writer with a southern voice
who could represent the South’s traditions to a national audience.
Sensing’s writings were not particularly literary or intellectually com-
plex, but his brand of southern exceptionalism appeared in pieces by
more masterful writers who published in Modern Age. The South, in the
pages of this journal, was not a cultural backwater, but rather a home
for the traditions of Western civilization. Kirk and Modern Age writers
reflected and augmented the SSIC’s vision of the South as the bulwark of
democracy. Defense of tradition motivated national conservative activists
Davidson referenced Sensing as an important local speaker and helped him connect with
17
M. E. Bradford, Russell Kirk, and publisher Henry Regnery. Davidson Papers, Box 3,
Folders 22, 23, 28; Box 43, Folder 13.
Davidson to Rubin, 3 January 1955.
18
4
5
2
and southern free- market conservatives alike. Although these groups

arrived at the same conclusion from different avenues, they nevertheless
advocated a similar role for the South in the nation. The fusion of south-
ern cultural conservatism with national currents clearly inspired Modern
Age’s editorial board, particularly in its intellectual justifications for tra-
ditionalist and libertarian synthesis. Even if relations among intellectual
conservatives was fractious, business and industrial conservatives built
alliances that worked and found avenues through which to disseminate
their depiction of the South vis-à-vis the nation.19
For manufacturers leading the SSIC, cultural traditionalism could
harmonize with their economic vision for the South, though such unity
was not always obvious. Tensions between libertarians and traditional-
ists continued. In 1958, Richard Weaver described the South as a region
resolutely bound to humanism despite the “encroachments of industrial-
ism,” positing that cultural traditionalism and industrialization remained
incompatible. Although often cast as diametric opposites, modernism
and traditionalism coexisted in the politics and worldview of southern
industrialists; they managed to strike a balance, though sometimes ignor-
ing contradictions between their humanistic worldview and their desire
to modernize the South’s economy. Southern capitalists embraced local-
ism and freedom from state intervention and agreed that elites needed to
guide development. Such attitudes created a common ground where the
two strains of conservatism could meet. Conservative intellectuals and
movement insiders needed a constituency for their new conservatism;
manufacturing-focused organizations such as the SSIC proved a fertile
middle ground between intellectual circles and the electorate, where a
grassroots movement could grow.20
19 Davidson to Kirk, 31 August 1954. Donald Davidson Papers 3–8. He spoke specifically
of Robert Penn Warren and Cleanth Brooks at The Southern Review, and John Donald
Wade’s The Georgia Review. Davidson to Kirk, August 31, 1954, Donald Davidson Papers
3–8; Robert Y. Drake, “What It Means to Be a Southerner,” Modern Age (Fall 1958),
348–349; Russell Kirk, “Norms, Conventions, and the South,” Modern Age (Fall 1958),
344–345; Willmoore Kendall, “What Is Conservatism?” Modern Age (Fall 1962), 358;
Louis D. Rubin, Jr., “The Coming Centennial of the Civil War,” Modern Age (Fall 1958),
388; Randall Stewart, “The Achievement of Faulkner,” Modern Age (Summer 1960), 323.
Libertarianism and traditionalism proved the toughest, though necessary, alliance for
20
the writers in Modern Age and served as the subject of much discussion. Frank S. Meyer
explained that traditionalists suspected libertarians of being driven by ideological com-
mitment, often “confounding reason and principle with ‘demon ideology.’ ” Each side,
he argued, sought to claim sole possession of reason, but accommodation and coopera-
tion was necessary to fight the “liberal collectivist Leviathan.” Frank Meyer, “Freedom,

52
Political influence remained SSIC leaders’ ultimate goal; with the

conservative movement growing, these men continued to try to influence
the workings of Washington toward their preferred political economy.
Business needed to take up leadership and, in the SSIC’s view, to use con-
servative momentum from intellectual circles to build political influence
and a successful movement. Donald Davidson recognized, via his conver-
sations with Russell Kirk and others, that a conservative movement was
beginning to coalesce in the mid-1950s, and he was determined to see
the South take a prominent role. Conservatives in the 1950s struggled to
find purchase. Cold War anticommunism blunted reform, but prosperity
did not provide the political animus to roll back the New Deal. The Cold
War, rather than being an alienating force, offered the opportunity to
lure allies outside the South. This political landscape added to the need
for greater public relations efforts, and the growing conservative network
proved invaluable.21
Donald Davidson and conservative commentator Anthony Harrigan
supported Thurman Sensing’s efforts to increase his public appearances.
Harrigan helped Sensing arrange twenty-nine speeches in eleven states
during 1959. As associate editor of the News and Courier in Charleston,
South Carolina, Harrigan supported the council in 1960 and assumed a
more prominent role after 1962. He would later succeed Sensing as exec-
utive vice president and expand the column “Sensing the News” to radio.
Meanwhile, Davidson coordinated with SSIC leaders Taylor and Sensing
to circulate the SSIC’s ideas and publications.22
SSIC leaders cultivated businessmen for a more political role.
Something had to be done, Sensing argued, to counteract labor’s sway
in politics. In the 1958 midterm elections, he cited AFL-CIO support for
199 House candidates, 124 of whom were elected. In the Senate, a similar
ratio reigned; twenty-three out of thirty-four candidates supported by
the AFL-CIO were elected, with total campaign spending at more than
Tradition, Conservatism,” Modern Age (Fall 1960), 355–363; Richard Weaver, “Up from
Liberalism,” Modern Age (Winter 1958–1959), 28.
Davidson to Frank Chodorov, 28 May 1954. Donald Davidson Papers 3–6. Davidson to
21
Kirk, 10 June 1955.
Donald Davidson Papers 3–11; Thurman Sensing, Annual Report, Board of Directors
22
Meeting Minutes, 27–28 May 1960, SSIC Papers Box 2, Folder 3. Conservative col-
umnist Anthony Harrigan began his association with the SSIC in 1962 and would take
Thurman Sensing’s place as public spokesman; see materials in Box 5, Anthony Harrigan
Collection. The Harrigan Collection and the SSIC Papers both contain recordings of
Harrigan’s radio commentaries, “Sensing the News” Boxes 49–51, Anthony H. Harrigan
Collection; SSIC Papers Vault IV-D-1-2v.
6
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2
$1.8 million. Any attitude that business should refrain from politics “was
completely disabused” by the election, he maintained.23
A set of mutually reinforcing observations bolstered Sensing’s hopes
that the SSIC could stimulate momentum for conservative politics inside
and outside of the South. At an informal meeting of business represen-
tatives in Washington, DC, SSIC general counsel Tyre Taylor and the
NAM’s powerful and politically connected head, Laurie C. Battle, were
the lone southern representatives. They heard from other leaders that “the
future of the country now rests in the hands of conservative Southern
Democrats” and that issues extended beyond union organizing. Thurman
Sensing reassured Taylor that the council, to capitalize on such outside
encouragement, was redoubling its efforts to gain greater national sup-
port for the organization.24
Business and the Two-Party South

Blocking desegregation was still part of the SSIC’s platform, but civil
rights tended to take a backseat to labor and regulatory policy debates.
Southern industrialists feared appearing intractable on racial matters, a
reputation that they understood would harm business and opportunity
for growth in the region. Their best chance for retaining local control
was to prevent any outside involvement in the governance or economy
of the South, leaving “states’ rights” to settle the race issue. Preserving
low-wage labor as a means for regional competitiveness remained the
council’s primary objective.
The white South’s intransigence on segregation hampered conservative
fusion, and cultural traditionalists rendered themselves ineffectual to the
movement, but the 1950s provided other issues on which to build coop-
eration. Judging from the doubling of annual SSIC donations between
1947 and 1952, business interest in politics was on the rise. The realiza-
tion of a national conservative movement and a two-party South was not
complete, but specific policy questions, such as international trade pro-
tections for small and medium-sized industry, built a network of allies.25
Tyre Taylor, Annual Report, 15 May 1959, SSIC Papers Box 2, Folder 3.
23
Ibid.
24
Tyre Taylor, Report to the SSIC Board, 15 May 1959. SSIC Account Books, 1947–1952.
25
The “philosophical differences” between Taft and Dewey factions of the GOP played out
in the 1948 election; Michael Bowen, “Getting to Goldwater: Robert A. Taft, William
Knowland, and the Rightward Drift of the Republican Party,” in Elizabeth Tandy
Shermer, ed., Barry Goldwater and the Remaking of the American Political Landscape
(Tucson: University of Arizona Press, 2013), 87–113.

7
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Business and the Two-Party South 257
In the SSIC’s Bulletin during the Truman and Eisenhower administra-

tions, council leaders repeatedly reported on the successes of the conser-
vative coalition in Congress, as well as on promising signs for a two-party
South. SSIC leaders grew increasingly critical of Truman’s conduct of
foreign policy. In 1951, Tyre Taylor criticized President Truman, his
Secretary of State Dean Acheson, and other international leaders for fail-
ing to take a stronger stance against communism. Citing General Douglas
MacArthur’s address to Congress after Truman removed him from com-
mand for insubordination and insistence on widening the Korean conflict,
Taylor declared that “continued appeasement” of communism prevailed
as a vexing issue. Regarding southern Democrats, Taylor suggested that
“there is reason to believe” that they “are finding themselves increasingly
unhappy in the present company” of Truman and his national security
advisers. SSIC spokesmen assumed that such a break would be beneficial
for southern industry and would receive ample support among their con-
stituents. Early in the 1950s, southern business leaders lacked sufficiently
strong relationships with the Republicans to reorganize southern politics,
even as the GOP recorded successes in the upper and outer South in the
1950 midterm and 1952 presidential elections.26
Senator Karl Mundt, a South Dakota Republican, offered an opening
for a North-South conservative convergence in 1951, but white south-
erners’ racial preferences scuttled the plan. Mundt’s National Committee
for Political Realignment pursued a conservative party and concluded
that success would be found by appealing to Midwestern, Taft- style
Republicans and conservative southern Democrats. Mundt’s committee
posited that convergence could be built on states’ rights language and, as
Tyre Taylor quoted, a Republican platform “consistent with the convic-
tions and traditions of the South” that omitted any planks “understand-
ably repugnant to the South.”27
Republicans criticized the plan for these very components, not want-
ing to alienate African-American supporters. The GOP instead pushed for
party development in the South, rather than realignment. Taylor praised
Mundt’s youthful and energetic efforts. The main obstacle, as he saw it,
Tyre Taylor, “Report from Washington,” Bulletin, 108, 1 May 1951, SSIC Papers Box 1,
26
Folder 2.
Rick Perlstein, Before the Storm: Barry Goldwater and the Unmaking of the American
27
Consensus (2001; reprt., Nation Books, 2009), 13; Robert Mason, The Republican Party
in American Politics from Hoover to Reagan (New York: Cambridge University Press,
2011), 141; Tyre Taylor, “Report from Washington” Bulletin, 111, 15 June 1951, SSIC
8
5
2
was that Mundt would have to overcome the “power of the party label,”
but if this could be done, it would extend the coalition, already existing
in Congress, that had been successfully “defeating many of the Socialistic
schemes of the Roosevelt and Truman administrations.” SSIC leaders
realized that for white southern politicians, a political coalition had to
safeguard segregationist arrangements, a priority that still matched their
own preferences.28
The 1952 presidential election strengthened SSIC leaders’ conviction
that the South needed to exercise a stronger sway in national politics.
Eisenhower won six southern states: Tennessee, Virginia, Missouri, Texas,
Florida, and Oklahoma. Though not Deep South states, where one-party
politics and racial disenfranchisement were strongest, it seemed that a
path out of the Democratic Party could be blazed. Ridiculing the idea
of the “Solid South,” SSIC president Paul Redmond concluded that the
election showed that the South, although long “consistently ignored and
rejected,” had emerged as the “chief cornerstone upon which to restore
a government dedicated to upholding the Constitution; the protection of
the rights and privileges of the people; and the repudiation of the philos-
ophy of centralized federal power.”29
A two-party South remained the ultimate goal, but Redmond cele-
brated the inroads already made. He concluded that not since 1928
had the Republican Party shown such strength in Dixie, and he cited “a
change in the political thinking of the Southern people.” For decades, he
declared, the two parties offered a choice between “a National Devil”
and “a National Witch.” The 1952 election showed signs that southern
Democrats could be relied on to vote their conscience and break party
ranks if necessary.30
In 1952, Redmond celebrated the evidence that the region was no
longer solidly “in the bag” for the Democratic Party, and he hoped this
trend would culminate in legislative victories. Interpreting the election as
a sign of “the importance of the power that can be wielded by Southern
Delegations in the coming Congress,” he hoped that congressional con-
servatives would “prevent the scuttling of sound legislation and the impo-
sition of more and more socialism.” Tyre Taylor added to Redmond’s
hopes, stating, “for the first time in a generation, the President of the
Tyre Taylor, “Report from Washington,” 15 June 1951.

28
29 Paul Redmond, “The Voice of the South” Bulletin, 145, 15 November 1952; Paul
Redmond, “A Two Party South” Bulletin, 149, 15 January 1953, SSIC Papers Box 1
Folder 2.
Paul Redmond, “A Two Party South.”
30

9
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2
Business and the Two-Party South 259
United States will be free to act in the best interests of the people –even
including the employers.”31
In 1953, Thurman Sensing evaluated President Eisenhower’s political
philosophy and policies and concluded that he “firmly believes in the free
enterprise system and the rights of state and local government, that is the
basis of American strength.” But by the end of Eisenhower’s first term,
SSIC leaders were visibly frustrated with “modern” Republicanism, par-
ticularly Eisenhower’s failure to roll back the New Deal. Yet Redmond’s
hopes for Congress received encouragement from conservatives who at
once blocked more “radical and hare-brained schemes” and could uphold
Eisenhower’s veto on measures that did make it through both House and
Senate.32
Divided parties offered opportunities and problems for southern
industrialists. The Republican Party split between “representatives of
the Eastern Internationalists” and the “Taft wing of the party,” as Tyre
Taylor put it. Taft was just the kind of conservative that gave southern
industrialists hope for realignment, and his death in 1953 slowed their
efforts to create political change. Thurman Sensing observed a similar
split among the South’s representatives. While the national debt and lack
of fiscal restraint continued to irk conservatives, and civil rights inflamed
southern “massive resistance,” Thurman Sensing declared the Eighty-
third Congress a failure. He lamented, “it would seem, therefore, that the
true conservative in this country has nowhere to turn, no party to which
to give his allegiance, no leadership he can trust.” Conservatives in either
party proved too weak, too divided by region and interests to be of use
to manufacturers seeking to protect established industry in the South.33
31 In 1948, Tyre Taylor reported that “Off the record –and sometimes on –both conser-
vative Republicans and Southern Democrats admit that the present party alignments
do not make any sense. The Tafts and Byrds belong in one grouping; the Peppers and
the Taylors (Hon. Glenn Taylor of Idaho) in another.” Taylor suggested that if southern
Democrats formed an independent party in 1948, the logical outcome by 1952 would
be “the purging of the Republican Party and its reorganization under another name and
along lines acceptable to the South.” Tyre Taylor, “Report from Washington,” Bulletin,
32, 16 February 1948, SSIC Papers Box 1, Folder 2. Louisiana, North Carolina, and
Texas returned margins for the Democratic Party under 10 percent. Paul Redmond,
“The Voice of the South” and Tyre Taylor, “Report from Washington,” Bulletin, 15
November 1952.
Thurman Sensing, “President Eisenhower,” “Down South” 28 June 1953, SSIC Papers
32
Box 7, Folder 2; Tyre Taylor, “Report from Washington” Bulletin, 15 November 1958,
James Stahlman expressed fewer doubts for progress upon Taft’s death, although he
33
considered it a “serious blow to the nation and the world.” He declared, “I don’t believe
0
6
2
Still, SSIC representatives pursued their national legislative activities.

Throughout the decade, Tyre Taylor, the longtime general counsel for
the SSIC, appeared before congressional committees, met with legis-
lators, submitted briefs, and acted not just on behalf of the SSIC but
also for the ACMA. In 1959, he appeared before the Senate Finance
Committee, a Senate Judiciary Subcommittee on constitutional amend-
ments, the House Public Works Committee, and the House Banking
and Currency Committee. Taylor acted on a diverse array of issues: he
promoted protections for the textile industry in the trade act extension
and supported Eugene Talmadge’s proposed Constitutional amend-
ment to restore public education to the states alone, and he opposed
distressed-area redevelopment grants. During the spring 1959 legisla-
tive session, Taylor met with more than fifty representatives and sena-
tors. Together, SSIC legislative activities and the efforts of the business
lobby amounted to a broad-based attempt to block federal interven-
tion in the political economy of the states –whether through federal
investment in job training or land redevelopment –and any union-
backed initiatives.
The SSIC remained a strong antiunion organization. Its leaders no lon-
ger organized to shield the South’s labor market, but rather to promote
the “freedom” of the employer against entrenched interests via right-to-
work laws, a component of state and local policies designed to promote
the South’s beneficial “business climate.” To protest the potential striking
of Title VI of the Kennedy-Ives (later Kennedy-Ervin) bill –so-called Taft-
Hartley “sweeteners” –Taylor met regularly with conservative southern
Democrats.34
Taylor also broadened his legislative influence to non- southern
conservatives. Taylor filed briefs and statements for the Senate Labor
Committee concerning the Kennedy-Ervin bill in 1959 in the wake of
Senate investigations into union practices. The bill attempted to create
a more level playing field in labor governance and prevent communist
the Senate is going to go completely nuts” considering that Republican Senator William
Knowland of California remained, who Stahlman considered a “very high class, able
boy.” Stahlman to William A. Bernerider, September 2, 1953, Stahlman Papers Vol. VIII,
Folder 8; Tyre Taylor, “Report from Washington,” Bulletin, 146, 1 December 1952, SSIC
Papers Box 2, Folder 3; Thurman Sensing, “Come Back, Coalition!” Bulletin, 143, 15
October 1952, SSIC Papers Box 8, Folder 1.
David A. Grossman and Melvin R. Levin, “The Appalachian Region: A National Problem
34
Area” Land Economics, 37, no. 2 (May, 1961), 133–141; Tyre Taylor, Report to the SSIC
Board, 15 May 1959.

1
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2
Foreign Trade and Southern Political Change 261
participation in union activities as well as racketeering and corruption.

Kennedy crafted the bill to be amenable to labor leaders, alienating
antiunion business leaders. The bill passed the Senate eighty- eight
to one, but it died in the House. The SSIC and business interests
demanded tougher action toward unions than what was proposed in
the bill, though their only support came from Barry Goldwater, the
lone vote against the bill in the Senate. Still, antiunion forces blocked
proposals that aimed to amend or eliminate Section 14b of the Taft-
Hartley Act that allowed states to pass right-to-work laws. Eventually,
controls on union activity, in response to charges of racketeering and
undemocratic practices, passed in the Labor Management Reporting
and Disclosure Act (Landrum-Griffin) of 1959. But issues other than
limiting unions created common ground between southern industrial-
ists and the GOP.35
Foreign Trade and Southern

Political Change
Renewed debates regarding trade protectionism strengthened the SSIC’s
hopes for a conservative realignment in Congress and revealed ongoing
divisions among business interests. Southern manufacturers wanted poli-
cymakers to defend southern manufacturing, as northern politicians had
when erecting tariff walls for domestic industries in the nineteenth century.
The political landscape offered some encouragement for those seeking
trade restrictions against rising foreign competition, particularly in textile
manufacturing. Following the presidential election, however, Eisenhower
disappointed SSIC leaders when he lauded the removal of barriers to
international trade. The president’s 1955 State of the Union address
Taylor reported working alongside other “employer-

35
representing organizations.”
He attended twenty-nine meetings, which included eleven NAM Labor Group meet-
ings, five NAM meetings on taxation, and a handful held by the U.S. Chamber, the
Trade Association Information Committee on the Taxation of Cooperatives, and the
Association of Electrical Companies (the last regarding TVA bond revenue). Taylor
touted his leadership of the “Labor Group,” which had orchestrated Taft-Hartley in 1947.
This group comprised of NAM and Chamber representatives, members of the American
Farm Bureau Federation, the National Lumber Manufacturers Association, the CTI, the
American Retail Federation, the National and Southern Coal Producers Association, as
well as affiliates of large corporations including US Steel, General Motors, and General
Electric. The group acted regarding labor legislation with a “high degree of coordination
of activity and strategy,” including as the Kennedy-Ervin bill in 1959. Tyre Taylor, Report
to the SSIC Board, 15 May 1959.
2
6
confirmed SSIC leaders’ long-standing suspicions when he announced,

“We must gradually reduce certain tariff obstacles to trade.”36,37
In 1955, debates over renewal of the Reciprocal Trade Agreements
Act (RTAA) prompted the SSIC to see promising political congruence
among economic interests across regions that aligned along policy, rather
than a sense of cultural affiliation. Council leaders aspired to change the
political status quo by leveraging these policy debates. The RTAA, origi-
nally passed in 1934, gave greater latitude to the president in negotiating
trade agreements, potentially circumventing congressional opposition.
The move, part of the Roosevelt administration’s internationalist foreign
policy agenda in the realm of economics, put access to markets at the
center of the United States’ ability to win allies.
By the 1950s, while the war between the northeastern urban, union
faction and the southern contingent of the Democratic Party continued
to worry conservative and segregationist southern Democrats, interna-
tional trade worsened a similar Republican division. Tyre Taylor reported
from Washington: “Republicans are split right down the middle on the
President’s recommendation for extension of the [RTAA], while the
Democrats are similarly divided over the issue of so-called Civil Rights.”
RTAA negotiations in 1955 occurred in a context of events that helped
drive home to SSIC leaders that their old standby arguments about a
homogenous South –ethnically, politically, and ideologically –no longer
applied. Southerners, SSIC leaders observed, were divided on economic
issues, as were the political parties themselves.38
One- party politics in the South had created a group of fractious
Democratic politicians with conflicting priorities, and the chaotic polit-
ical climate of the 1950s exacerbated the divisions. The “obligatory
stands” for segregation taken by some representatives were no longer
enough to satisfy southern trade protectionists, who threatened to with-
draw their support for southern Democrats. Alabama senator and 1952
vice presidential candidate John Sparkman, in particular, felt the wrath
Portions of this section previously published in Katherine Rye Jewell, “‘Gun Cotton’:
36
Southern Industrialists, International Trade, and the Republican Party in the 1950s”
in Glenn Feldman, ed., Painting Dixie Red: When, Where, Why, and How the South
Became Republican (Gainesville: University Press of Florida, 2011), pp. 201– 219,
selected excerpts. Reprinted with the permission of the University of Florida Press.
Dwight D. Eisenhower, “Annual Message to the Congress on the State of the Union,”
37
January 6, 1955. Online by Gerhard Peters and John T. Woolley, The American
Presidency Project, www.presidency.ucsb.edu/ws/?pid=10416.
Tyre Taylor, “Report from Washington,” Bulletin, 15 January 1955, SSIC Papers Box 1,
38
Folder 2. South Carolina Textile Manufacturers Association to southern textile manufac-

turers, 15 October 1956, Alabama Textile Manufacturers Association Papers, RG 632,
Auburn University Department of Archives and Special Collections.

3
6
2
of indignant industrialists in 1955, when they protested the senator’s

unwillingness to protect their interests.
Alabama industrialists, organized with other Dixiecrats, had attempted,
unsuccessfully, to unseat the state’s liberal senators Lister Hill and John
Sparkman in 1948, and the New Dealers remained a thorn in manu-
facturers’ sides, despite shared opposition to desegregation. Birmingham
manufacturer P. G. Shook, exasperated by his communications with
Sparkman, complained to colleague J. Craig Smith of Avondale Mills,
“I despise him! Give me some ammunition to fire at him.” Sparkman
had infuriated Shook by telling him that the Senate Finance Committee
amendments to the renewal bill would not protect many industries. What
really outraged Shook was that Sparkman ignored the greater issue: the
Senate’s failure to guard domestic industry and curb presidential author-
ity by rejecting the amendment outright. He continued, “[I]‌f he and other
Southern Senators had voted against the Bill the threat to the textile
industry would have been removed.”39
For southern conservatives, a threat arose from increased presiden-
tial power, not only from competition from cheaper labor abroad. The
Alabama senators could have shielded the South, Shook maintained, “by
depriving the President of the power to further cripple the industry by
further reduction in the tariff.” If Alabama’s premier industries could not
rely on the state’s senator in the matter of trade policy, then Sparkman
could not be counted as a friend. “I think he is utterly hopeless,” Shook
declared. “He should be a ‘Senator at large’ representing the whole coun-
try instead of representing the State of Alabama.” Though Sparkman
proved instrumental in bringing rocket research facilities to Huntsville,
this was not the industrial support SSIC leaders sought because it did
little to protect existing industries and their markets. The greatest threat,
however, came from Congress’s willingness to hand over its power to the
president, who could doom southern industry to destructive competition
in the name of international harmony.40
39 Walter Bass and Jack DeVries, The Transformation of Southern Politics: Social Change
and Political Consequence Since 1945 (1976; reprt., Athens: University of Georgia Press,
1995), 58; Frederickson, The Dixiecrat Revolt and the End of the Solid South, 94–95.
Amendments allowed the Tariff Commission to recommend protections if imports were
a contributory, but not primary, reason for an industry’s distress and included an escape
clause appeal for a single line of production –such as cotton towels or velveteen –even
if the industry as a whole remained unscathed. Tariff Commission recommendations
had to be made public before the president’s ruling, a clause intended to increase public
pressure for tariff increases. This weakened version passed the Senate 75–13. P. G. Shook
to J. Craig Smith, 5 June 1955, Donald Comer Papers 7.146.24.
Shook to Comer, 6 June 1955; Shook to Comer, 21 June 1955, Donald Comer Papers
40
7.146.24; Bass and Devries, The Transformation of Southern Politics, 58. Sparkman’s
4
6
2
A long-term view reveals the logical convergence of the interests of

northern and southern manufacturers. Competition from the global
South had been building since the late nineteenth century, when entrepre-
neurs in Asia and South America sought to gain a foothold in the global
cotton trade. The movement of spindles to the U.S. South reflected more
the delayed reaction of the movement of industrial capitalism into the
region because of its low-wage labor than a peculiar, beneficial mix of
culture and climate, as SSIC leaders in the 1930s contended. In the 1930s,
northern textile producers had lamented the political situation in similar
ways that southern producers did in the 1950s.
Northern manufacturers expressed disbelief that southern represen-
tatives did not line up behind the region’s prominent industry. Lawton
Brayton, president of the Northern Textile Association, thanked
Donald Comer for his activism. Brayton had recently met with Ellison
McKissick, SSIC vice president and president of South Carolina’s Alice
Manufacturing. McKissick reportedly told Brayton “that it was very pecu-
liar that an industry as large as the textile industry is … [does] not have
more friends not only in Congress but also in the administrative side.”
Brayton and his associates, particularly Malcolm Chace of newly merged
Berkshire-Hathaway, had been able to secure strong support from certain
northern representatives, including Joseph Martin, the powerful former
House Minority Leader, Speaker, and Republican National Committee
Chairman from Massachusetts. Still, Brayton remarked, “There really is
nobody so far that has stood up and battled for us … particularly true of
some of your influential Southern Congressmen.”41
By 1956, Donald Comer ceased hoping for Congress’s support, and
the textile industry pushed for voluntary agreements with the Japanese.
Neither political party stood for the needs of his industry, he complained.
In the RTAA renewal aftermath, Comer and his allies had traveled to
Washington continuously for eighteen months to try to secure quotas
and were discouraged. “We have had the opposition of the leaders of the
Republican Party, the opposition of the leaders of the Democratic Party,”
he protested. On top of the parties’ failure to protect the cotton textile
industry, manufacturers also faced “the opposition of powerful business
election in 1954, 1960, and 1966 revealed the growing strength of Republican challenges.
In 1954 J. Foy Guin received only 17.5 percent of the vote, but in 1960 Republican
challenger Julian Elgin received 29 percent. By 1966 the Republican challenger received
39 percent.
41 Beckert, Empire of Cotton, 399–400; Northern Textile Association. Lawton Brayton to
Comer, 10 April 1956, Donald Comer Papers 7.146.34.

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2
organizations … interested in building their exports, the opposition of

Walter Reuther and the CIO, the unions for which he speaks, and the
opposition of free traders and world-wide ‘do-gooders’ too numerous
to count.” Comer’s greatest annoyances were representatives’ assurances
that the textile industry was not being hurt and recommendations that
grievances should be directed by petition to the Tariff Commission, a
practice he had already dismissed.42
Comer and SSIC leaders claimed to prefer honest competition of a
free-enterprise system to government “subsidy.” The SSIC saw the RTAA
as an unnatural, bureaucratic system that distorted national free enter-
prise, though organization leaders also realized that Japanese producers
benefited from more attractive labor costs than those in the South. The
region might develop new industrial lines, but what would happen to
existing textile mills and workers? The model of decentralized industry,
built with locally sourced capital, had been the dream of SSIC leaders,
and it was disappearing in a wave of mergers and buyouts.
The textile industry received scant support from national organiza-
tions such as the NAM and the Chamber of Commerce. Both groups
endorsed freer trade, which benefited large corporations that could out-
source production. Charles Cannon, president of one of the largest textile
companies in North Carolina, confided to J. Craig Smith, “I have not
found myself willing to be associated with either one of these organiza-
tions for a long time.” He continued, referring to the split among business
groups on the issue, “I think we were successful in stopping the Chamber
of Commerce from adopting some anti-import quota plan last year, but
I don’t care to pay my money into an organization and then fight them
the rest of the time to protect my position.” Cannon and Comer contin-
ued to give generously to the SSIC because it was an ally in matters of
international trade.43
Consumer and manufacturer boycotts proceeded in the wake of rising
competition. In 1956, state-based resistance sprang up across the South
in the form of laws requiring signs identifying stores that sold Japanese-
made cotton goods. South Carolina and Alabama passed similar laws, and
Georgia, Louisiana, and Mississippi narrowly defeated sign requirement
initiatives. Comer thanked the Chairman of the Alabama Republican
Executive Committee for his help in the matter. Comer blamed the
Donald Comer, “Additional Facts Concerning Japanese Imports,” draft of article for
42
Avondale Sun, 5 March 1956, Donald Comer Papers 7.146.34.

Charles A. Cannon to Comer, 14 December 1956, Donald Comer Papers 7.146.34.
43
62
influence of Eisenhower’s Secretary of State, John Foster Dulles, for the

failure of the signage requirement. “Mr. Dulles is mad” over the Alabama
and South Carolina laws, Comer wrote, but “whether the law is good or
bad is not the fact at hand … the local people are determined to do some-
thing about this matter because they feel that Washington has thrown our
textile industry to the wolves.” Tactics that textile states used to pressure
consumers to “buy American” revealed the growing depth of political
sentiment in the region.44
During the General Agreement on Tariffs and Trades (GATT) nego-
tiations in the summer of 1955, some southern senators pleased indus-
trialists by calling for government action on import quotas for textiles
and the pricing of cotton exports. South Carolina’s Strom Thurmond,
Virginia’s Harry Byrd, and Mississippi’s James O. Eastland defended
their states’ industries vigorously. Although their arguments reflected the
SSIC’s historic reliance on regional solidarity, the underlying protectionist
rationale was based in economics rather than any sense of homogenous,
shared identity. Social and cultural goals would be served by such legis-
lation, preserving local arrangements and the power of industrialists and,
presumably, winning the continued loyalty of textile workers. Japanese
exporters, alarmed by the vehemence of these textile states’ protests,
agreed to enter voluntary quota talks out of “self-preservation.”45
New issues roused southern industrialists and brought them closer to
the national Republican Party, despite its divisions, than the old southern
Democrats, many of whom, the industrialists felt, could not be counted
on to protect American industry. Southern business leaders’ arguments,
though still conservative, broke with those of traditional southern
Democrats by putting racial unity and a traditional social structure to
the service of economic and industrial development, rather than the
reverse. While building bridges to the GOP, and in spite of abandoning
their central emphasis on southern unity, the SSIC also managed, through
Donald Davidson, to capitalize on connections with cultural tradition-
alists. In this way the organization sought to build cooperation within
the conservative movement while simultaneously developing ties with the
Republican Party and non-southern business interests.
The Southern Garment Manufacturers’ Association, which shared many leaders with
44
the SSIC, led the sign movement. Dulles appealed to Gov. Russell Long of Louisiana
personally to stop the law. Sayuri Shimizu, Creating People of Plenty: The United States
and Japan’s Economic Alternatives (Kent, OH: Kent State University Press, 2001),
150. Donald Comer to Claude O. Vardaman, 23 April 1956, Donald Comer Papers
7.146.28–31.
Shimizu, Creating People of Plenty, 113.
45

7
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2
Conclusion 267
Conclusion
Changes in the South’s economy in the 1950s and 1960s opened up new
areas of activism for the SSIC but also weakened the group’s organizing
principle. What had long been the SSIC’s cause –preservation of the South’s
competitive advantage through low-wage labor –had receded in a more
nationally oriented movement that downplayed the region’s economic sep-
arateness. Rising low-wage competition from the global South presented
problems similar to those presented to the North by the growth of southern
industry a generation or two earlier. In cotton textiles, the center of global
production shifted to Asia in the 1950s; likewise, in the 1920s, a previous
generation of northern manufacturers had looked at the southern states as
both an opportunity for investment and a source of dangerous competition.
Though it remained a decidedly southern organization, the SSIC’s changing
nature revealed the Americanization of Dixie in the 1950s.
Ironically, the weakening of the one-party South and the SSIC’s touting
of Dixie as the bulwark of democracy yielded a weaker identity around
which southern conservatives could organize effectively. The idea of an
attractive “business climate” defined the wider Sunbelt, not just the areas
previously dominated by New South industry, such as the Piedmont. The
SSIC’s activism in the 1950s and the focus on international trade served
to narrow the organization’s platform and alienated large corporations
that had once given generously to the council. After the election of John
F. Kennedy in 1960, large corporations found better representatives for
big business’s growing antipathy toward government policy. A new lob-
bying infrastructure took hold among American businesses in the 1960s
just as the SSIC narrowed into a largely single-issue interest group of
small and medium-sized businesses focused on securing tariff protection
from foreign wages, and the group’s leaders found the GOP to be a suit-
able avenue for their policy preferences.46
Internationalists in the Republican Party had not scared away Donald
Comer. Civil rights, social welfare, deficit spending, and unionism con-
tinued to divide the Democrats, and trade issues had prompted alli-
ances between southern manufacturers and protectionist Republicans.
Nashville newspaper publisher James Stahlman wrote to Comer as
the 1956 presidential election neared, “I am glad that … regardless of
46 Beckert, Empire of Cotton, 431. Ben Waterhouse explains the rising antipathy of business
toward the Kennedy administration and the development of the Business Roundtable,
which attracted many of the large corporations that had supported the SSIC in the
1950s. Waterhouse, Lobbying America, 20–25.
8
6
2
what has happened in the textile situation, you are sticking with Ike and
Dick. I am sure they will be elected, but it is going to take the interest
and support of real Americans like yourself to see that the left-wingers,
the Reuthers, and the crackpots don’t take over.” The fears Stahlman
expressed continued to plague southern business leaders until a strong
conservative leader emerged.47
In more ways than one, the business’ branding of Dixie appeared to
be catching on. Senator Barry Goldwater, a Republican from Arizona,
appeared before the SSIC’s annual meeting in Ashville, North Carolina, in
May 1960. There he praised the council’s statement of purpose for plac-
ing free enterprise at the center of the organization’s agenda. He agreed
that it would be proper for southerners and northerners to come together
to “save our Constitution and Free Enterprise System,” and Democrats
and Republicans should forget about party allegiance and recognize that
they were Americans first. Goldwater spoke of the dangers of government
centralization and bureaucratic overreach. He spoke of states’ rights, but
invoked the idea to combat the expanded interpretation of the Interstate
Commerce Clause and the growth of a “cradle to grave” welfare state.
Federal aid to education, to the aged, and the expansion of the welfare
state violated states’ rights, in Goldwater’s formulation. Instead of using
states’ rights as coded language for segregation, Goldwater used the idea
to inspire his business-oriented audience to act and to vote. The SSIC and
national conservatives had secured a language that could contain diverse
right-leaning interests in common cause.48
By the mid-1960s the SSIC attracted support for its positions on taxes,
regulation, federal spending, and welfare programs, as well as for its
advocacy of protectionist trade policies for textile and other industries
experiencing greater competition from international firms, particularly
Japanese cotton textile producers. The SSIC boasted writers whose col-
umns appeared in local dailies and in national conservative publications.
Anthony Harrigan’s columns appeared in the National Review. Southern
business conservatives, cultural traditionalists, and defenders of segrega-
tion found common ground in the SSIC’s states’-rights language. From
their conservative perspective, what was good for the South was good
for the nation.
James Stahlman to Donald Comer, 5 October 1956, Stahlman, VIII, 15.

47
Barry Goldwater, “The Conservative South,” before Annual Meeting of the Southern
48
States Industrial Council, Asheville, North Carolina, 27 May 1960. SSIC pamphlet, SSIC

9
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2
Conclusion 269
While the SSIC’s longtime director of public relations Thurman

Sensing clung to the word “industrial,” it was really the word “southern”
that ceased to define the organization and its mission. The defense of
a separate southern economy with special needs had long since disap-
peared from the SSIC’s agenda. The rightward movement of the business
lobby in the 1960s left the council to contend with a narrow set of issues.
Although the SSIC helped forge the politics of free enterprise, a lack of
regional focus diluted the organization’s mission. In crafting an image for
the region as the “nations No. 1 economic opportunity,” ironically, the
SSIC’s embrace of free enterprise undermined its mission to “protect and
defend” the South and its civilization.
0
7
2
Epilogue: The Politics of Free Enterprise
Southern industrialists’ efforts to protect their labor market from the

interventions of federal policy and from international competition failed.
In the locales from which this business leadership emerged, a new political
constituency arose. The Cracker Barrel voters, as they could be termed,
inhabit the counties and towns left behind by the ongoing movement
of global capital. They are the workers who must search for new jobs
when factories leave and who must increasingly rely on the lower-paying
service sector for employment. These workers’ grievances, however, have
frequently been hidden by electoral realignment and more forceful narra-
tives to explain the disaffection of white votes from the Democratic Party.
Wilson County, the home of Cracker Barrel and also the former site
of John Edgerton’s Lebanon Woolen Mill, is a steadfast Republican
Party stronghold. Yet the workers of Wilson County were not Reagan
Democrats. The county’s GOP allegiance emerged since the 1990s, after
the Lebanon Woolen Mill, and those like it, closed. A southerner, Jimmy
Carter, won the county with 58.4 percent of the vote in 1980. Wilson
County voters narrowly selected Arkansan Bill Clinton in the 1990s,
but rejected neighboring Smith County’s Al Gore, Jr., in 2000. Between
2000 and 2016, Republicans won the county handily as factories, like
a Dell facility, came and went, continually seeking lucrative tax breaks
and providing undependable work for residents. Donald Trump carried
68.8 percent of voters, compared with the Democratic nominee Hillary
Clinton’s 25.5 percent. The politics of white backlash have dominated
historical narratives of places like Wilson County and the South’s elec-
toral transformation in the mid- twentieth century. Reactions to civil
rights, to busing, to the unrest of the 1960s, and more recently to the
270

1
7
2
growth of immigration from Latin America and Asia, remain important

in explaining the region’s electoral shift. But beneath party politics, trans-
formations in global capitalism have yet to be adequately incorporated
into these narratives. The rise of the Sunbelt, its politics, and its economic
contours help to explain the emergence of a new political reality, along-
side the ongoing relationship between business interests and the conser-
vative movement.1
Cracker Barrel voters rejected not only liberal elites, but also conser-
vative and Republican policymakers. The capitalist entities supported by
the politics of free enterprise did not promote the welfare of southerners
and Sunbelt residents. Such voters increasingly felt ignored and subjected
to negative policy outcomes under presidential administrations of both
parties as well as to the movement of capital. The Cracker Barrel vote,
when taking these accounts into consideration, is not simply about reflex-
ive white southern identity, although such categories are intertwined with
economic concerns. It is also about the people and places left behind in
the transformations of global capitalism and the dominance of the poli-
tics of free enterprise.
Business leaders, such as the SSIC’s members, formed part of the reac-
tion against this rising global corporate order with its reliance on the
wages and labor of the global South. The SSIC, first formed to resist fed-
eral intervention in southern wages, became a protectionist organization
against expanding federal regulations and labor policy, as well as to the
lowering of tariff barriers that would subject their low-value added prod-
ucts to competition from cheaper foreign made goods. Their consistent
goals, from the 1930s to the 1960s, were to preserve their labor mar-
ket, to control their labor force, and limit costs and regulations. As they
called for localism and federalism, these business leaders represented an
elite, business-led rejoinder to working-class populism. Yet these business
interests were responsible for the lack of visibility of this political syncre-
tism, given their own rhetoric about the nationalization of the South and
their emphasis on free enterprise. While Cracker Barrel built a successful
1 Tennessee Secretary of State, "President of the United States -Tennessee," Certification of

Election Returns for the General Election November 4, 1980 (Nashville, 1980); Tennessee
Secretary of State, "President of the United States -Tennessee," Certification of Election
Returns for the General Election November 6, 1984 (Nashville, 1984); Tennessee Secretary
of State, State of Tennessee Electors for President of the United States November 3, 1992
General Election (Nashville, 1992); Tennessee Secretary of State, Division of Elections.
Official Results November 7, 2000 General Election United States President, Tennessee
Secretary of State, Division of Elections; “Tennessee Results,” Election 2016, New York
Times, www.nytimes.com/elections/results/tennessee.
2
7
272 Epilogue: The Politics of Free Enterprise
chain by marketing the good old days or rural southern life and down
home cooking, southern manufacturers pursued the nationalization of
their cause and embraced policy that no longer differentiated the South’s
economy.2
In 1960, Thurman Sensing received letters from across the country in
response to his “Sensing the News” syndicated column. Some were praise-
ful, some critical (and some crackpot, of course). “Just the other day,”
he noted in May, “I received letters from the widely separated points of
Fort Lauderdale and Colorado Springs.” The reader from Florida accused
Sensing of lacking “horse sense,” while the Colorado reader praised
Sensing’s enjoyable articles and stated that he hoped for a return to “nor-
malcy,” particularly regarding the Supreme Court’s decision under Chief
Justice Earl Warren, though he did not cite specific cases. The SSIC’s pro-
motion of the South as a bastion of free enterprise reached California,
where one reader declared, “I have been tempted to move somewhere
within the Southern States because your political philosophies are more
in keeping with my Republican background than the hyphenated brand
of Republicanism I find in California.” The letter’s author asked for 1,600
reprints of the SSIC’s pamphlet titled “Inflation,” which argued that ris-
ing prices resulted from increased government spending and welfare. The
writer distributed the piece to the members of the California Association
of Employers to encourage the state to be more southern in its politics
and policy.3
The drift toward national allies promised to transform the SSIC
from a regional organization into an ideologically coherent, rather than
regionally defined, lobby. After a quarter of a century, the SSIC had
gained the attention of business associations promoting the same brand
of free enterprise and free market ideology. The SSIC pamphlet, “The
Fallacy of the Minimum Wage,” would be reprinted in The Freeman, the
Foundation for Economic Education’s journal. SSIC leaders marketed the
South as a haven for these ideas. By the early 1960s, they possessed an
ideological and political, not regional, identity. Unlike during the orga-
nization’s founding years in the 1930s, when the SSIC had attempted to
represent the broad swath of southern industrial opinion to policymakers
2 Such syncretism would not be sustainable. Elizabeth Tandy Shermer explores late-
twentieth-
century “Frankenstein’s Monster” of white homeowners, like the Cracker
Barrel voters, who increasingly rejected “business governance, which seemed incompati-
ble with the free-enterprise conservatism that boosters and CEO’s had trumpeted during
capitalism’s intraregional migration.” Shermer, Sunbelt Capitalism, 303-304.
3 Sensing, Annual Report, 27–28 May 1960.

3
7
2
in Washington, the group had ceased to be geographically bound, despite

its name. The South’s labor market lacked the specifically regional char-
acteristics of decades past. Moreover, the region’s industrial elites suc-
cessfully were linking the region’s economic opportunities, fostered (they
claimed) by states’ pro-business policies, they claimed, to the ideology
of the emerging national conservative movement. But economic changes
also destabilized the organization’s core message and constituency.
SSIC leaders began the 1960s at once focused on building a conserva-
tive party and open to where that party would emerge. By the middle of
the decade, a diversifying southern economy led to significant changes in
the SSIC’s membership and created a crisis of support. While SSIC lead-
ers backed conservative-minded candidates and promoted the rhetoric
of free enterprise, organizationally, the council faced challenges. Modern
and global managerial capitalism had reached traditional New South
industries, which increasingly either merged or found themselves acquired
by outside firms. Consequently, the SSIC’s membership declined. With
decreasing contributions, the council suspended its educational activities
to concentrate on its publications. Anthony Harrigan gradually emerged
as Sensing’s successor as the public face of the SSIC during the 1960s.
He and other SSIC spokesmen continued to solicit support for “national
concerns” but found by the 1960s that their record of “far right” activism
had alienated major sources of such support who found more reputa-
ble representation from the established national business organizations.
Even so, the SSIC increasingly downplayed the separate “South,” whether
defined politically, economically, or culturally.4
The “corporate dreamland” coveted by business and targeted by polit-
ical strategists was not the one envisioned by the SSIC’s founders in 1934,
although it still bore many of the hallmarks of southern business conser-
vatism. SSIC leaders rebranded the regional economy and embedded free
enterprise in the region’s political culture as federal minimum wage law
remade the South’s labor market and Dixie transitioned into the post-
war global economy. They promoted right-to-work laws in their states,
and connected their economic arguments to white southerners’ defense
of segregation. The SSIC’s reach was wide, but in time council leaders’
focus increasingly narrowed to issues relating to small and medium-sized
industry. The ironies of this legacy are significant: the SSIC’s activism
promoted homegrown capital investment, local ownership, and an older
4 SSIC leaders differentiated educational programs as speeches and appearances targeting

specific audiences, whereas publications were aimed at wider distribution.
4
7
2
style of labor management and relations that relied on social hierarchies

that were fast disappearing. Leaders’ vision of decentralized industry,
with innovation that balanced the region’s raw material resource pro-
curement with related manufacturing, was sacrificed on the altar of free
enterprise.5
The saleability of the South as a symbol for antistatism and free enter-
prise was not a remnant of the Confederate past; it was a product of New
Deal and World War II policy battles and political networking. The SSIC’s
South, as a result, stood for free enterprise and localism within an explic-
itly national framework. The SSIC split with other Sunbelt interests over
free trade and protectionism, but the organization remained linked to
the conservative movement via anti-union and anti–welfare state politics.
The SSIC’s history attests to the transformation of the idea of the South
into a more flexible, ideological notion that transcended geography.6
The term Sunbelt evoked southern identity –but an identity that
was less prescriptive. The southern identity at the heart of SSIC activ-
ism was not structurally, economically, or politically defined; instead it
proved weak, superficial, symbolic, and mutable enough to suit politi-
cal circumstances. New social and cultural imperatives replaced those of
old. The politicization of evangelical Christians in the 1970s would take
the politics of region in new directions. Evangelicals found purchase in
the Sunbelt framework and established a comfortable home within free
enterprise and the service sector businesses, most notably Wal-Mart. The
SSIC’s purpose, in this context, at once became more national, yet also
more constricted, existing at the far right of the political spectrum and
focusing more and more on a narrow set of issues pertaining to small and
medium-sized industry, regardless of location. Business leaders, although
they attempted to prevent the drift of American manufacturing jobs to
the Global South, for their own reasons, offered no leader or set of pol-
icies that would protect American workers in the regions dominated by
small and medium sized firms focusing on manufacturing. While the SSIC
5 The politics of the Sunbelt of the late 1960s and early 1970s embraced “A distinctive
climate of political thought,” where “[r]‌esidents of this corporate dreamland internalized
the progrowth, antiregulatory, free market assurances of venture capitalism and sought to
limit the reach of the federal state in sectors that did not serve these interests.” Nickerson
and Dochuck, Sunbelt Rising, 5.
6 Phillips, The Emerging Republican Majority. Historians described the emerging political
attitudes in the Sunbelt. In the 1950s, “liberalism in the developing Sunbelt was already
associated with red tape, retarded development, and economic stagnation”; Nickerson
and Dochuk, Sunbelt Rising, 5; Shermer, Sunbelt Capitalism, 33; Moreton, To Serve God
and Wal-Mart, 261.

5
7
2
The SSIC and Southern Politics in the 1960s 275
participated in the electoral transformation of the South, with leaders

working at the local level to bring southern states into the GOP fold,
its members also had to contend with broader shifts in global capital-
ism that would weaken their political power and further destabilize their
regional intersts.7
The SSIC and Southern Politics

in the 1960s
Some SSIC leaders had registered as Republicans or supported GOP can-
didates as early as 1928, but the organization’s Democratic ties remained
strong until the 1950s, when SSIC leaders amplified their efforts build-
ing a conservative party, be it Republican or Democratic. Manufacturers
expressed a desire to challenge the Democratic hold on southern con-
gressional seats given the national party’s support of civil rights and the
New Deal, but few possibilities emerged. Moreover, the issues that had
animated business activism receded. National union membership never
again reached its high point of nearly one-third of workers following the
failure of Operation Dixie and 1955 merger of the AFL-CIO. Growing
cooperation among business leaders contributed to the feeling that indus-
trial concerns had adequate hearing in Washington, even if the voice of
business at times appeared weak.
The 1960 election reanimated SSIC leaders’ contention that liberals
within the Democratic Party could not be countered, even with a south-
erner on the ticket. Though Lyndon Johnson had an antiunion record,
southern manufacturers distrusted the Texas senator. Kennedy repre-
sented the northern, liberal power in the Democratic Party that inspired
conservatives to strengthen calls for cooperation to roll back the wel-
fare state and to preserve segregation. Kennedy’s nomination as the
Democratic presidential candidate in 1960 convinced SSIC leaders that
the time had come for a conservative challenge to moderates’ and liber-
als’ control of the parties.
Whereas in 1948 the SSIC’s president had declared that southern busi-
ness leaders should “keep their powder dry,” in 1960 the organization
mobilized to realign southern politics. At the same meeting at which
Barry Goldwater appeared before the membership in 1960, Tyre Taylor
7 Daniel K. Williams, “Jerry Falwell’s Sunbelt Politics: The Regional Origins of the Moral
Majority,” Journal of Policy History 22 (2010): 125–47. For Wal-Mart and free enter-
prise, see Moreton, To Serve God and Wal-Mart. See also Dochuk, From Bible Belt to
Sunbelt; Waterhouse, Lobbying America, 78.
6
7
2
assumed that most southern delegates at the upcoming Democratic

convention in Los Angeles would support Johnson, the South’s native son –
but would bolt from the ticket if he failed to get the nomination. Days
before the election, Taylor told Donald Davidson that party realignment
seemed near. Taylor surmised that, if Kennedy won, “the Republican Party
might well polarize around Goldwater and [the moderate Republican
Nelson] Rockefeller, in which case conditions would be favorable for the
establishment of a new conservative party which the South could sup-
port.” The GOP, he assumed, would be the natural party for a takeover,
given its potential weakness without conservative support.8
By 1960, Davidson, Taylor, Sensing, and other public intellectuals and
pundits were plotting a Republican Party takeover by forces rooted in
the South’s “constitutional” conservatism. While intellectuals debated the
feasibility and ideological coherence necessary for the fusion of the con-
servative movement, the SSIC looked to practical issues to build support.
A new generation of leaders offered a way forward, one that eschewed
overt racial bigotry and instead looked to decouple conservatives from
the Democratic Party. These men proposed infiltrating local organiza-
tions, building support at the grassroots level, and generating centrifugal
pressure that would break traditional party loyalties. Though more of an
astro-turf than a grassroots movement, SSIC leaders saw it as fulfilling
the agenda Hayek had set out for them in the late 1940s. These leaders
carried the ideological message of the SSIC and its vision for the nation
into the backrooms of politics and into the public sphere.9
Newly elected SSIC president J. Clifford Miller, a graduate of the
Virginia Military Institute, World War II veteran, and head of the wood
products company his father had founded, presented the case for that
state’s politics as an example to emulate in other southern states. The
result of his efforts, if successful, would be the rise of a two-party South,
to which SSIC leaders had long looked as a panacea for their economic
and policy agenda. Beyond reaching out to the public, infiltrating existing
8 Taylor concluded that the Republican Party faced potential demise without conservatives,
writing, “Either [they keep conservatives in the fold] or the GOP will be consigned to
the outer darkness for a long, long time.” Tyre Taylor to Donald Davidson, 26 October
1960; Davidson to Taylor, 15 November 1960, Donald Davidson Papers 2–23. Davidson
indicated to Taylor that he would share his thoughts with newspaper editor Tom Waring
of the Charleston News and Courier.
9 Some SSIC leaders, and most members, qualified as “grasstops,” a term applied by
Elizabeth Tandy Shermer to Sunbelt boosters, but the public figures of the SSIC existed still
above this level, attempting to coordinate national politics. Shermer, Sunbelt Capitalism,
2. Miller, Annual Report, 27 May 1960.

72
Democratic institutions seemed to be the key to building the conservative

movement. A grassroots effort could not develop and succeed without
organizational support. A conservative leader in Washington told Miller,
Sensing, and Taylor that the SSIC was one of twenty-seven organizations
picked from a list of more than 6,000 “best qualified to help with a con-
servative program.” Miller met with the powerful Virginia Representative
Howard W. Smith and subsequently reported that Smith believed the
council was more effective and distinct than other conservative organiza-
tions of its ilk. Such praise, if not merited, at least swelled the sense that
manufacturers in the South had the ear of key politicians in Washington.10
At the local level, Miller cited political circumstances in Richmond as
examples of how to build support for conservative candidates who would
promote free enterprise and right-to-work laws, as well as continue to
block civil rights measures. While a state of the upper South, Virginia’s
political geography resembled other states in Dixie. Its rural, conservative
areas boasted almost no manufacturing and mining, and “hence few of
the organizations who sponsor and preach big government, big spend-
ing, big taxes, monopoly unions” held sway in these districts. Instead,
Miller warned, “Our cities and mining areas are our dangerous spots
right now. Here politics has been left to those who have time for it –
those ward heelers and down-the-liners who put party above principle,
or anything else.” Such a geographical divide could be overcome with
the combined and organized strength of the business leaders in urban
areas. That development in turn would then draw electoral support from
rural areas. Miller recommended that other southern states learn from
Virginia’s lesson. SSIC leaders strategized that the politics of the upper
and border South, the states that had voted for Eisenhower, not the reac-
tionary racial politics of the Deep South, would provide the best avenue
for conservative success.11
Miller touted his role as Richmond City Democratic Committee chair
and the Committee’s endorsement of Richard Nixon in 1960 to inspire
and provide a model for future conservative successes Richmond busi-
ness leaders took hold of the Committee during the 1952 presidential
election. Doing so allowed them to control nominations and increased
the number of state and national delegates supporting conservative posi-
tions. Because business leaders constituted only a small percentage of city
voters, they undertook a campaign of education for Richmond’s citizens,
Miller, Annual Report, 27 May 1960.

10
Ibid.
11
8
7
2
building momentum at the local level. In April 1959, Miller and others
hosted a three-day workshop in Williamsburg, later emulated by the
Virginia Transit Co., the Richmond Fredericksburg & Potomac Railroad,
and Sears-Roebuck. These three firms hosted eight sessions for employ-
ees, followed up in 1960 with a one-day workshop attended by 150 lead-
ers of forty businesses in the Richmond area.
These workshops asked white-collar employees to take an interest in
politics, regardless of party, but the organizers had clear partisan goals.
As one local newspaper explained, the City Democratic Committee
planned a meeting “at which the Democratic platform almost certainly
will be denounced,” since it was led by “[f]‌ormer Eisenhower Democrats”
who hoped to influence the platform under a Kennedy ticket, rather than
bolt the party, though some had already declared support for Nixon. The
Committee voted twenty-five to six to denounce the Democratic plat-
form, citing its call for a repeal of right-to-work laws, the voting records
of Kennedy and Johnson, and Robert Kennedy’s “criticism” of Harry
Byrd and Howard Smith, referring to their obstructionism on desegrega-
tion. The committee chairman, Miller, and six officers then declared their
support for Nixon.12
During the 1960 Republican convention, SSIC leaders had been wary
of Nixon. Even if he passed the SSIC’s litmus test on anticommunism, he
seemed a problematic minister of the conservative message in national
politics. With the nominations set, SSIC leaders hoped to use Nixon as
a vehicle for their larger ambitions. In Richmond, the committee’s goal,
Miller explained, was to inspire supporters to participate in year-round
political activities and to generate the energy and political will to sup-
port business-oriented candidates at the local and state levels. The state-
ment supporting Nixon declared him the best candidate to protect free
enterprise.13
Ibid. In Virginia, Byrd’s influence bolstered local efforts to resist desegregation. Later, in
12
the lead-up to the Civil Rights Act of 1964, Smith’s chairmanship of the House Rules
Committee would be a key obstacle for Johnson to overcome, as with previous civil
rights legislation.
Ibid. “GOP and Democrats Step Up Virginia Pace,” Associated Press, The Progress Index
13
(Petersburg, VA), 18 October 1960; “Democratic Committee Endorses Nixon,” The

Bee (Danville, VA), 29 October 1960; Bill Johnson, “Undecided Voters Hold Balance
in Va.” Associated Press, The Progress-Index, 30 October 1960. Progress-Index editors
endorsed Nixon despite declaring Byrd and Goldwater were attractive candidates and
decided that running a conservative would “necessarily defeat its own purpose by sub-
stracting [sic.] from the Nixon-Lodge total and increasing the likelihood of the more
radical Kennedy-Johnson ticket carrying Virginia.” “They Offer the Best Hope,” editorial
in The Progress-Index, 16 October 1960.

9
7
2
If unsuccessful in presidential politics, southern manufacturers had

reason to believe their efforts could reshape state and local affairs, as
well as their representation in Washington. Miller claimed significant
results for his Democrats-for-Nixon efforts, citing his role in deliv-
ering the commonwealth to Nixon and the growth of conservative
support at the state level. In 1953, he explained, the Virginia con-
gressional delegation’s voting record was 75 percent conservative. By
1960, it was 86 percent conservative. J. Vaughan Gary, Richmond’s
representative in the House voted 60 percent conservative in 1952
and 90 percent conservative by 1959, and he was the top conservative
Democrat. Watkins M. Abbitt, Norfolk’s representative, made simi-
larly large gains, voting 30 percent conservative in 1952 and 55 per-
cent in 1960.14
Public relations, in combination with traditional lobbying, offered
means to cement an urban-rural coalition and elevate the power of busi-
ness politics. The Byrd machine, with its power base in rural areas where
voters proved more intransigent against desegregation, could still strike
a tone amenable to urban areas and gain support from industrialists and
moneyed interests. In this context, public relations and education, as
Miller told SSIC leaders, were a “sure way to increase your conservative
representations. To me, this is progress. It is slow, but it is in the right
direction.” He recommended the council build a legislative committee to
supplement Tyre Taylor’s work in Washington. Such a committee would
assist representatives and other political operatives. Combined efforts,
Miller declared, would mean that Barry Goldwater would no longer be
able to say, “I have seen weakness, even cowardice, in businessmen across
the country.”15
Miller, Annual Report, 27 May 1960. Miller’s hopes for an outright conservative take-
14
over in his state would prove ill-founded. In the 1960s, Virginia elected a progressive
Democrat and then a moderate Republican. Nevertheless, political upheaval, though it
broke up the Byrd machine, gave SSIC leaders hope that their messages could reshape
state politics and gain wider converts to conservative principles. The 1960s “Second
Reconstruction” ended the “traditional pattern of southern politics,” and led to a
“more open and competitive politics.” Grantham, The Life & Death of the Solid South,
165–166, 176.
Byrd moderated or amplified the race card as needed. Heinemann, Harry Byrd of
15
Virginia, 328–329. Goldwater repeated his admonition to the SSIC and also at the
George Washington Day Dinner of the American Good Government Society on 30 April
1960. Byrd inserted it in the Congressional Record of 5 May 1960. Barry Goldwater,
“The Conservative South,” before Annual Meeting of the Southern States Industrial
Council, Asheville, North Carolina, 27 May 1960. SSIC pamphlet, SSIC Papers Box 8,
Folder 3.
0
8
2
Other SSIC supporters showed an even stronger desire to keep con-

servatives united across state and regional lines and with the GOP to
prevent Kennedy’s election. Nashville Banner publisher James Stahlman,
who often expressed exasperation with conservative factionalism, praised
Richard Nixon’s leadership in the party. Nixon, he argued, paved the
way for future GOP conservative candidates. Prior to his nomination at
the 1960 Republican convention, Stahlman pointed out, Nixon “immo-
bilized” Nelson Rockefeller while maintaining support from the mod-
erate wing of the GOP. Stahlman praised Nixon’s strategy, stating that
while Nixon “uses common sense in eliminating FEPC and an outright
endorsement of the sit-ins principle, [he] keeps Barry Goldwater and the
southern crowd in the fold.” Nixon was the kind of leader who could
bring the South into the party, and thus business leaders would have their
central concerns represented. In the process of melding together conser-
vatives and moderates in the party, Stahlman hoped Nixon was creating
space for the Right to emerge stronger.16
A network of conservative business leaders around Nashville helped
Republicans woo southern voters using tactics that downplayed massive
resistance. Stahlman acted as a go-between for these men and national
politicians. He maintained a correspondence with Nixon after expediting
the vice president’s appearance in Nashville in 1956. He advised Nixon
on how to appeal to Nashville residents on a return visit during the 1960
presidential campaign, and the newspaper publisher recommended a
color-blind approach to building a political coalition of white and black
southerners. He advised that Nixon praise “stair-step” integration and
congratulate black and white residents for “mutual good will and an
honest effort at racial understanding.” He also advised avoiding any
mention of the sit-in movement and particularly of James Lawson, the
Vanderbilt Divinity School student and leader of the Nashville sit-ins. He
suggested that Nixon praise the achievements of Nashville Olympians
Wilma Rudolph and Ralph Boston to court favor among black voters.17
Like many of his allies in business, Stahlman approved of gradual
desegregation to avoid clashes between violent white supremacists and
peaceful demonstrators, but he denounced civil rights demonstrators as
vehemently as he did their white opponents. Racial violence, from his
perspective, was bad for business, bad for the South, and injurious to a
conservative political realignment. Nixon’s narrow defeat in the 1960
James Stahlman to James S. Copley, 2 August 1960, Stahlman VIII, 23.

16
Stahlman to Richard Nixon, 6 September 1960.

17

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2
presidential election did not quell Stahlman’s conviction that conservatism

was on the rise within the GOP. Rather than expressing discouragement,
Stahlman pointed to Goldwater. He told journalist Westbrook Pegler
to “watch our boy Goldwater.” Goldwater would “lay off the pace”
and then “pull up toward the nomination in 1964 as a Constitutional
Conservative Republican.”18
Other politicians sought support among southern business leaders by
paying respects to their economic interests. When appearing before the
SSIC’s 1961 annual meeting, Senator Strom Thurmond of South Carolina
encouraged his audience to be active in politics. Building on Goldwater’s
message to the SSIC of the previous year, Thurmond enumerated the lim-
ited responsibilities of government and the ways such boundaries were
being violated with respect to business activity. Economic prosperity, he
argued, was the responsibility of business, not government. Government
need not expand in scope and complexity to match labor and business,
but should retain its original function as “defender and umpire” of
national interests.19
Individualism, colorblindness, free markets, and a hands-off federal
government were the terms that united these factions, and politicians
sought business support by incorporating them into their appeals.
Equality, Thurmond stated, could not be legislated and, in fact, was an
illusion. “The only equality which is consistent with individual liberty and
a government devoted to it,” he explained, “is that equality which by its
very nature produces inequality –equal justice before the law.” Individual
“attainment,” he told the gathered business leaders, results from “indi-
vidual talent, imagination, and initiative.” Degeneration of society would
be the inevitable result of a “perversion” of government so long as busi-
ness leaders remained out of the political fray. Introducing Thurmond,
William Lowndes of the Greenville, SC, Southern Weaving Company,
explicitly praised the senator’s stance against civil rights and integration,
but Thurmond avoided direct mention of the issue. He understood the
delicate balance needed for conservatives to come together across regional
lines, although those lines appeared weaker than in past decades.20
A two- party South, realignment of parties, or a takeover of the
Democrats (or Republicans) by conservatives: all had appeared
Ibid. Stahlman to Westbrook Pegler, 28 November 1960, Stahlman VIII, 23.

18
Strom Thurmond, “The Purpose of Government,” before SSIC Annual Meeting, 30 May
19
1961, SSIC Pamphlet, SSIC Papers Box 8, Folder 3.

Ibid.
20
2
8
intermittently on the SSIC’s agenda for more than two decades. Sensing
believed that “the South has long since lost any reason for depositing its
franchise in a block upon the altar of the Democratic Party.” Strong com-
petition supported healthy politics, just as it did business, he explained.
The SSIC’s far-right positions gave the organization its political identity,
with the John Birch Society existing slightly further to the right. This
rightward conservatism proved a liability as the region and nation moved
past the Red Scare of the 1950s and as the South’s economy continued
to diversify.21
Shifting Sands
New Deal reform did not end southern industry, as SSIC founders had
warned. The organization’s key sources of support –textile manufactur-
ers, furniture makers, and leaders from other commodity-intensive indus-
tries –remained the core contributors to the organization, even as their
numbers declined in the 1960s in the face of global capital shifts and
mergers. Few, if any, went out of business because of onerous bureau-
cracy or regulations. Hypercompetition –a problem that New Deal
reforms attempted to combat –proved disastrous to southern plants, not
minimum wages. Southern manufacturers mobilized to protect their mar-
ket shares and political and social power, not just profits. Still, the end
of the regional labor market unleashed subtle changes that transformed
the region and altered the region’s industrialists’ political ideology. The
South continued to rely on low-wage industries for economic develop-
ment, but new industrial activity and corporate establishments, alongside
rising competition in low-wage manufacturing from the Global South,
undermined the political and social power of New South industrialists.
Southern localities, through the 1950s, lured outside investment on
a large scale. This resulted in a different outcome than the SSIC’s lead-
ers’ vision of homegrown ownership and innovation. The SSIC’s goals
of maintaining low wages in the South and preventing unionization
had been accomplished, but the organization’s strategy to grow south-
ern capital and to keep the South competitive produced a number of
unintended consequences in the postwar years. The increased presence of
multinational corporations undermined local manufacturers across the
region. Competition in the textile and garment industries, in particular,
21 Thurman Sensing, “Needed: A Strong Two-Party South” “Down South” 20 July 1952,


3
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Shifting Sands 283
emerged from areas of the world where wages were lower than in the
South and led to mergers, buyouts, and migration of manufacturing over-
seas. Deindustrialization, a phenomenon that tends to be associated with
the 1970s and heavy industry in the North and Midwest, began, in many
ways, in textiles –first in the 1920s, with northern mills’ migration to the
South, and then in the 1950s, with migration of southern mills abroad.
Though southern workers still found work in low-wage industries, they
became the employees of far off owners, not of their neighbors.22
Under such national and international pressures, the organization’s
regional identity faltered. Fostering doubt, too, was the growing network
of national conservatives with whom SSIC spokesmen engaged in the
1950s. New interests challenged the control of the SSIC’s traditional
membership. National, rather than specifically southern, corporations
became the largest donors, further undermining the SSIC’s identity as
a regional organization. Throughout the 1950s, the idea of renaming
the council surfaced in conversations among SSIC leaders. At a 1961
Executive Committee meeting, a board member repeated the proposi-
tion that the SSIC eliminate the word “industrial” from its title. Thurman
Sensing remained loyal to the name, having published under the moniker
for nearly two decades, but membership rolls suggested that the board
member had a point.23
The organization kept its name until 1971, but years of changes in
membership foreshadowed the change then. The SSIC’s shifting mem-
bership reflected the diversification and changing corporate structure of
southern industry as well as the rising concerns of small and medium-
sized manufacturers who could not compete with national and interna-
tional interests vying for land, workers, consumers, and raw materials. In
1956, although textile manufacturers still provided the largest percentage
of SSIC donations, other interests were gaining. Diversified manufactur-
ing and business interests, along with individual donations, had gained
significantly on traditional New South industrial supporters. In the
1930s, SSIC funding swelled from industries that demanded protection
For the attraction of European investment, see Maunula, Guten Tag, Y’all. Timothy
22
Minchin examines deindustrialization in the textile mills and reveals the early origins of
decline, arguing that the textile industry was the first to experience the phenomenon that
would characterize the 1970s and prompt alliances across the political spectrum, as well
as consumer boycotts. Minchin, Empty Mills. See also, John Gaventa and Barbara Ellen
Smith, “The Deindustrialization of the Textile South: A Case Study,” in Hanging by a
Thread: Social Change in Southern Textiles, ed. Jeffrey Leiter, Michael D. Schulman, and
Rhonda Zingraff (Ithaca, NY: Cornell University Press, 1991), 181–183.
Executive Committee Meeting Minutes, 29 May 1961.
23
4
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2
as “infant” industries. In the 1950s, the SSIC drew support not so much
from a dominant industrial sector, but more from conservative busi-
ness interests and their allies. Construction firms, retail establishments,
individuals, and other manufacturing surpassed traditional New South
industries as the SSIC’s main source of support. By 1964, these interests
overtook textiles, forest products, and raw material processors in SSIC
donations. Larger corporations dominated the patterns of capital invest-
ment in southern locales. New South industries could go big, specialize,
or get bought out.24
New South industry was declining, a fact reflected in industries’ weak-
ened political power and waning emphasis on regional economic iden-
tity. In the SSIC’s first twenty years, top donors were relatively stable,
but support fluctuated significantly after the early 1950s as the southern
manufacturing economy transformed and the region underwent a “bull-
dozer revolution.” Contributions from large textile conglomerates that
swallowed up local mills continued to support the council’s activities,
but these too were declining. In 1964, only 8.5 percent of SSIC dona-
tions came from textiles, down from 13 percent in 1956, and a far cry
from the 33 percent of total SSIC dues payments in 1934, thirty years
prior. By the 1960s, investors in capital and manufacturing outnumbered
those engaged in Dixie’s “traditional” industries, and the SSIC evolved
to reflect the region’s shifting status vis-à-vis the economy and national
political developments.25
Building on ties with the conservative press forged during the 1950s,
columnist Anthony Harrigan joined the public relations team and pro-
moted the issues at the heart of the SSIC’s activism in National Review
and elsewhere, broadening the organization’s audience. Individual con-
tributions spiked in the early 1960s, from less than 1 percent in 1956 to
more than 5 percent in 1964, suggesting that the SSIC’s public relations
efforts had some success. Physicians were the most common individual
donors, but the SSIC also attracted outspoken right-wing personalities,
including the barnstormer Roscoe Turner and the strident eugenicist and
white supremacist Charles M. Goethe of California. Jackson B. Davis,
a Louisiana state senator and lifelong Democrat, gave to the coun-
cil in 1964, the same year that he protested Lyndon Johnson’s nomi-
nation for president. Council leaders’ continued defense of segregation
into the 1960s also earned the support of other reactionaries and white
Moreton, To Serve God and Wal-Mart, 261.

24
Executive Committee Meeting Minutes, 29 May 1961.

25

5
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Shifting Sands 285
supremacists as the organization struggled with its economic vision and

core identity.26
The SSIC also received support from individuals with specific interests
and agendas. Deering-Milliken, the South Carolina–based firm headed by
Roger Milliken, gave generously to the SSIC in 1964, reflecting Milliken’s
conservative politics and quest to foster business-oriented candidates.
Two years later Milliken would fund Ronald Reagan’s successful 1966
run for California governor. His SSIC support represented the new direc-
tion in which the organization was headed. He pushed protectionist trade
policies and buy-American consumer movements, efforts precipitated by
the textile industry’s domestic decline.27
Yet, as the SSIC increasingly identified as a far-right and protection-
ist organization, it alienated large corporations. In the 1950s, several
major firms from General Motors and Chrysler to General Electric
and R. J. Reynolds gave generously to the organization, and execu-
tives such as Pierre S. DuPont participated in SSIC meetings. Such sup-
port declined in the 1960s as the SSIC veered rightward. Only General
Motors remained among the top twelve donors, although U.S. Sugar
joined the list of supporters. The SSIC had always been an organization
on the right, and it grew increasingly so, but defined more by insistence
on protectionist trade policy, unlike the NAM, and by its advocacy in
maintaining the power of established elites. As the region’s business
elites moderated on questions of race, the intraregional industrial orga-
nization moved further to the right in response to the New Frontier,
Great Society, and growing social unrest. Thurman Sensing, who had
repeatedly sounded warnings about the communistic drift of American
policy in the 1950s, in 1966 recalled Eisenhower’s presidency as an
era of “good feeling” in comparison with a new era of “bitter strife,
open violence, war, and inflation.” Dixie’s manufacturers drew closer
to the national Republican Party and away from southern Democrats,
SSIC Account Book, 1964.

26
27 Krugman cites Milliken’s support of the USBIC. Krugman highlights the strange fact that
the USBIC advocates protectionist trade policy along with conservative ideals, writing,
“Alan Tonelson, of the U.S. Business and Industrial Council’s Educational Foundation,
is simultaneously writing position papers on foreign policy for the harshly conservative
Cato Institute and supplying factoids for presidential hopeful Gephardt’s speeches on
trade policy.” Krugman’s attempts to portray men like Milliken or Tonelson as ignorant
obscures the complex evolution of their politics. Paul Krugman, “Who’s Buying Whom?
The Milliken Man March on Washington” Slate Online, www.slate.com/id/1924/, 26
September 1997. Tonelson focuses on balancing manufacturing with consumption,
domestically. Tonelson, The Race to the Bottom, 152.
6
8
2
many of whom, SSIC leaders felt, could not be counted on to protect

American manufacturing jobs.28
The social and economic debates of the mid-1950s divided southern
political defenders against civil rights and revealed the diversification of
the “southern viewpoint” regarding business and industry. In the midst
of regional development, southern industrialists emerged as a politically
powerful voice in a region dominated by rural and agricultural inter-
ests. Manufacturers’ arguments, though conservative, broke with the
South’s Democratic tradition by gradually emphasizing economic and
industrial development over racial unity and traditional social struc-
tures. As the SSIC adopted coherent conservative economic positions,
its leaders became primary voices for a southern politics that did not
revolve “around the position of the Negro,” as defined by political sci-
entist V. O. Key, and the politics of the Deep South. Instead, these men
fit their social preferences within a conservative framework defined
by free-market ideology. The SSIC amplified the political and policy
preferences of elites at the congressional level and, in pursuit of this
conservative worldview, pioneered cooperation with Republicans and
intellectuals of the New Right.29
Free enterprise reoriented Dixie’s established industrial leaders toward
a new vision of the southern economy and class identity. Established indus-
trialists proved central to the development of the region’s postwar “busi-
ness climate.” First used in specific policy debates, free enterprise proved
a useful concept that avoided overt racism while also creating common
cause with non-southern conservatives. This revision in rhetoric subtly
reoriented manufacturers’ priorities by privileging the service of national
values over sectionalism in the context of the Cold War. The diversifica-
tion and destabilization of the SSIC’s membership led the organization
rightward and into more niche issues related to small and medium-sized
industry. The centrifugal forces of economic change and nationalization
undermined the SSIC’s identity, weakening the membership base. As a
Thurman Sensing, “A New Mood Develops,” “Sensing the News” syndicated column,
28
21 August 1966. SSIC leaders were vocal in the 1960s on questions of international
politics, particularly regarding its opposition to decolonization in Africa, particularly
the challenges to British rule in Rhodesia. See Anthony Harrigan’s Sensing the News
radio broadcasts and issues of the Bulletin in the late 1960s. Tape 9, Side A, “For Reason
on Rhodesia” Program 97, SSIC Papers, Vault. USBIC pamphlets in Gordon Hall and
Grace Hoag Collection of Dissenting and Extremist Printed Propaganda, Ms. 76. Brown
University Library, John Hay Library, Providence, RI.
Key, Southern Politics in State and Nation, 5.
29

7
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Shifting Sands 287
result, however, the organization would be captured by new interests in

the late 1960s and early 1970s.30
Although the SSIC declined, its arguments provided continuity with
the traditional southern brand of localism on the one hand and the emer-
gent national business conservatism of the 1960s and 1970s on the other.
For a southern strategy to be a viable tactic for the Republican Party in
1968, there had to be compatibility across issues and worldviews, not just
antigovernment syncretism between business conservatives and southern
white supremacists. The South emerged as a powerful economic and
political force in the 1960s; it offered a dynamic economy and became
important again in picking the nation’s presidents. Such power depended
on convergence between region and nation, and the work of southern
manufacturers went far in rebranding the South’s economic reputation
and in pursuing an interregional conservative coalition. Business leaders
in the region, as in the rest of the nation, were important in reshaping
American politics organizationally, financially, and ideologically, even as
the economic and social world of the traditional New South manufac-
turer crumbled.31
The nationalization of the SSIC’s mission and the increasing emphasis
on matters facing small and medium-sized industry ushered in a new gen-
eration of leaders with a narrower focus but with a broader geographi-
cal base. While the SSIC of the 1950s attempted to comment on myriad
factors affecting southern life, by the 1970s the organization focused on
its narrowing economic agenda. Conservative economic ideas, such as
low business taxes and fewer regulations, which the organization contin-
ued to tout, accompanied calls for restrictions on free-market ideology in
the international sphere. Anthony Harrigan succeeded Thurman Sensing,
who died in 1971. Sensing, with his ties to the Citizens Council and adher-
ence to a specifically southern identity for the organization, had held
back the SSIC’s nationalization. As executive director, Harrigan oversaw
the name change to the USBIC, which reflected the organization’s focus
30 Michael Bowen, “The First Southern Strategy: The Taft and the Dewey/Eisenhower
Factions in the GOP” in Feldman, Painting Dixie Red, 220–239. Hon. Ralph W. Gwinn
(NY), “The State of the Unions,” delivered before the Allegheny County League of
Women Voters at Pittsburgh, on 27 February 1958 in Condon, “Reports of President,
Vice President, and the Secretary-Treasurer” presented at Annual Meeting of the Board
of Directors at Hot Springs, VA, 29 May 1958, SSIC Papers Box 2, Folder 2.
Bartley, The New South, 1945–1980, xii, 41, 83, 449. Crespino notes how GOP candi-
31
dates still had to appeal to the Wallace vote in the Deep South, and they built on regional
business elites’ efforts to merge free enterprise with states’ rights. Crespino, In Search of
Another Country, 205–206.
82
on national and international affairs and, in particular, on trade policy.

Harrigan maintained the council’s public relations program by contrib-
uting columns to newspapers and publications such as National Review
and American Spectator. He also recorded a syndicated radio commen-
tary, which continued the organization’s emphasis on white rule abroad,
particularly regarding decolonization in Africa, even as such opinions
were less acceptable in domestic politics. Importantly, as globalization
became an ever-present fact for American manufacturers, Harrigan and
later Council leaders would help bridge debates between libertarian and
conservative positions on international trade and policy relating to the
health of American industry.32
Harrigan’s warnings, in the 1970s and 1980s, of the dangers of unfet-
tered international trade established the USBIC as a conservative orga-
nization opposed to the internationalism of the Heritage Foundation,
the American Enterprise Institute, and the Center for Strategic and
International Studies. Later, the USBIC would criticize neoconservatives
and internationalist supporters of George H. W. Bush’s intervention in
the aftermath of Iraq’s 1990 invasion of Kuwait. In the early 1990s, this
divide convinced many liberal commentators that American conservatism
faced potentially disastrous internal divides. Those divisions emerged
along ideological, organizational, and economic interest lines, rather than
along regional ones. American conservatism remained an intellectual and
political movement with many factions, some of them regionally based,
but not with the overt geographic splits of the previous generations.33
As for the mission of the USBIC, all identity as a southern-based orga-
nization disappeared after the early 1970s. The USBIC’s statement on
32 For more on the development of the conservative press, see Nicole Hemmer, Messengers
of the Right: Conservative Media and the Transformation of American Politics (Princeton,
NJ: Princeton University Press, 2016). See USBIC pamphlets in Gordon Hall and Grace
Hoag Collection of Dissenting and Extremist Printed Propaganda, Ms. 76.
The most prominent appearance of the SSIC occurred in Report of the Select Committee
33
on Assassinations of the U.S. House of Representatives, which named two members

of the SSIC as potential instigators in the assassination of Martin Luther King, Jr. The
Report named the SSIC as a connection for two suspected conspirators, John Kauffman
and John Sutherland, the latter of whom had been a SSIC regional director. The report
also mentioned Thurman Sensing’s critical remarks about Dr. King. The Committee con-
cluded that circumstantial evidence existed for a conspiracy, but it found no institu-
tional links to the SSIC. The report refers to Thurman Sensing as “Theodore Sensing.”
U.S. House of Representatives, Report of the Select Committee on Assassinations of
the U.S. House of Representatives, 95th Congress, 2nd Sess. (Washington, DC: GPO,
1979) 365–368; John B. Judis, “The Conservative Crackup” The American Prospect, 21
September 1990.

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Shifting Sands 289
its history, as of 2015, does not mention the organization’s southern

origins, although it dates the founding to 1933. Rather, the USBIC web-
site declares that the organization represents the “concerns of America’s
small and medium-sized business community,” and “Member companies
are typically family-owned or privately held, mostly in the manufac-
turing sector.” This mission reflects the vision of Main Street–oriented
politics and industry, and the members “are often the major employers
in their home communities and the mainstays of the local economy.” The
USBIC defines itself as grounded in “mainstream America” and is critical
of the dominance of “giant multinational corporations with global agen-
das and dwindling national loyalties.”34
The struggles of small and medium-sized manufacturers against global
competition remain the USBIC’s primary focus. These concerns exist
without the southern social, cultural, and regional dimension that origi-
nally influenced the organization’s activism, although the vision of decen-
tralized, locally controlled industry and employment persists. In 2000,
economist Alan Tonelson, a USBIC Research Fellow, defended American
manufacturing as an essential component of the nation’s economy
and rejected yielding to a “postindustrial,” service- oriented economy.
Industrial leaders in the SSIC, throughout its history, discussed build-
ing industry and capital, modernizing, and providing jobs for destitute
southern workers. At the heart of this activism, leaders were interested in
protecting established industries. For the SSIC, this defensiveness domi-
nated even as tactics and rhetoric changed. Protectionism still defines the
organization’s offspring, the USBIC, despite the free-market rhetoric and
orientation of the group toward national concerns.35
Shades of protectionism based in a politics of southern identity char-
acterized the SSIC from its founding in 1933 through the 1960s even as
the organization’s core ideology and practical political strategies trans-
formed. Free enterprise rhetoric created a usable, productive brand and
profile for the organization and the region when southern economic
exceptionalism could not. The SSIC emerged to protest the challenges
to southern wages that arose from the New Deal and World War II
and ultimately joined the constellation of organizations that comprised
the conservative movement. Southern business leaders linked an older,
“About Us,” USBIC, http://americaneconomicalert.org/aboutus.asp.

34
35 Egerton, Americanization of Dixie; Grantham, The South in Modern America; Fifteen

Southerners, Why The South Will Survive; Reed, Minding the South; James C. Cobb,
Away Down South: A History of Southern Identity (New York: Oxford University Press,
2005); Tonelson, The Race to the Bottom.
0
9
2
traditionalist conservatism and localism to a modern movement shaped

by national and international intellectual and activist networks. The SSIC
rebranded the South’s economic identity to mesh with a national move-
ment and in so doing relinquished the social and cultural core of the
organization’s original program. Instead, a regional politics infused with
the language of free enterprise emerged.
Yet free enterprise and the appearance of the national business com-
munity’s convergence around policy and economic development could
not erase regional differences and conflicting priorities. The interests of
small and medium sized manufacturers that comprised the SSIC’s mem-
bership increasingly clashed with the policy demands of the global corpo-
rate order that replaced the older model of American manufacturing. The
politics of free enterprise emphasizes a nationally and globally oriented
set of policies that continues to disguise the divergent interests of regional
economies, wage structures, and state-level regulations and tax policies.
The SSIC is gone, but the politics of region and protectionism will con-
tinue to underlie electoral politics in the twenty-first century.

1
9
2
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Index
Agrarians. See Southern Agrarians Andrews, Elmer, 153, 155

(Vanderbilt) Anti-Defamation League, 239
Agricultural Adjustment Act (AAA), 59, 65 antilynching legislation, 206
processing tax, 92 southern opponents of, 123, 147
Alabama By-Products, 177 Truman’s support for, 211
Alabama Textile Mills, 249 Armistead, George H., 72–73, 100
Alcoa, 166 Arnold, Remmie, 210, 218, 220, 224, 232
Alldredge, J. Haden and Taft-Hartley passage, 227–228
Alldredge Report, 171–172 Atlantic Coast Line Railroad, 146, 181
All-South Council, 179 Avondale Mills, 36, 263
American Cotton Manufacturers
Association (ACMA), 28, 30, Bachman, Nathan L., 87
37, 76, 83 Bailey, Josiah, 56, 84, 114, 148
FLSA testimony, 156 address at SSIC dinner in 1938, 147–148
Tyre Taylor as general counsel, 260 and conservative coalition in
American Enterprise Institute (AEI), Congress, 229
222, 288 and the Declaration of Principles, 144
American Federation of Full Fashioned New Deal criticism after 1934 midterm
Hosiery Workers, 102, 109 election, 86
American Federation of Labor (AFL), 56, opposition to Black-Connery bill, 141
103, 106 SSIC support for, 145–147
American Federation of Labor-Congress of suggested contrasts with Sen. Bilbo, 234
Industrial Organizations (AFL-CIO), support for FDR, 84
255, 275 Ballew, J. H.
American Legion, 248 and States’ Rights Democratic Party
American Liberty League, 103, 117, 134n6 convention, 236–237
American Snuff, 37 Bankhead, John H., 135
Anderson, William, 28–30, 36, 37, 51, Barkley, Alben, 87, 236
75, 145 Barr, John U., 174, 232–234
criticism of New Deal, 55–57 and States’ Rights Democratic Party, 238
and NRA revision, 77–80 Battle, Hyman, 157
and southern wage differentials under Battle, Laurie C., 256
the NRA, 55–56 Berry, George L., 103
311
312 Index
Bibb Manufacturing, 28, 36 Cohen, Benjamin, 77

Bilbo, Theodore, 229 Coker Pedigreed Seed Company, 70
Black, Hugo L., 133, 149 Coker, David, 69, 92
Black-Connery wage-hour bill of 1937. views of Penderlea colony, 70
See Fair Labor Standards Act (FLSA) Cole, Rush, 181, 208
first proposal, 133 Comer, Donald, 137, 144, 183
and implications for race relations, anti-free trade activism, 264–265
142–143 and child labor laws, 75
SSIC response to, 134, 136, 138–139 Eisenhower support, 267
BMW (Bayerische Motoren Werke AG), 2 (grandfather) B.B. Comer’s
boosterism, 273–274, 282–283 governorship, 171
balancing with existing industry, 180 and minimum wages, 134–136
and branding the South, 9 and NRA revision, 75, 77–80
Broadus Mitchell’s discussion of, 1 as a progressive, 38
and diversification, 14 and Rexford Tugwell, 58
in the nineteenth-century South, 23, 38 and southern representation on NRA
policies to support, 57, 136, 226, 228 code boards, 45
revision using free enterprise, 154 support for NRA, 49
role of segregation in, 216 support for Thurmond in 1948, 237
SGA role in, 180 views of Penderlea colony, 70
SSIC advocacy for, 180 and wage differentials, 41–42
Borah, William, 147 Cone, B. O., 207
Brayton, Lawton, 264 Congress of Industrial Organizations
Brown v. Board of Education of Topeka (CIO), 8, 95, 222n34
(1954), 241 Connery, William, 133
Bulwinkle, Alfred L., 143n26 conservative coalition
Burke, Edward, 145 emergence of, 241, 257
Burlington Mills, 96, 108, 166 conservative coalition in Congress
Bush, George H. W., 288 after the FLSA, 151–152, 197
business, business leaders business support for, 151, 235
public image of,, 44 emergence of, 120, 147
Bylo Furniture Manufacturing and the FEPC, 209
Company, 81 and SSIC in the 1950s, 256–257
Byrd, Harr F. consumer boycott of imported textiles,
as potential presidential candidate in 265–266
1960, 278 Copeland, Royal, 145
Byrd, Harry F., 144, 197, 203, 226, 229, Corcoran, Thomas, 77
231–234, 278, 279 Cornelius, Charles L., 194, 195
and conservative coalition, 148 Cotton Textile Institute (CTI), 26, 27,
and international trade, 266 27n12, 29, 30, 45, 134, 261n35
New Deal criticism after 1934 midterm Cracker Barrel, xiii
election, 86 Crawford Manufacturing Company, 207
political machine in Virginia, 279 cultural traditionalism
Byrnes, James F., 229 and business, 252–254
Byrns, Joseph W., 87 and conservatives, 251
Cannon Mills, 27 D&W Shirt Company, 63

Cannon, Charles, 27, 265 Dan River Mills, 32, 132
Chatham, Thurmond, 94, 143 Davidson, Donald, 244
Chrysler Corporation, 244 alliance with SSIC, 1950s, 251–253
Civil Rights Act (1958), 241 and Howard Odum, 67
Index 313
and the New Deal, 71–72 DuPont, Pierre S., 103, 285

and the Republican Party, 276 Dyer, Gustavus, 97, 100, 119, 149, 174,
and Tennessee Federation for 219, 223, 234
Constiutitonal Government, 252
traditionalism of, 251n14 Eastland, James O., 266
views on segregation, 251 Edelberg, Herman, 239
Davis, Jackson B., 284 Edgerton, 33
DeBardeleben Coal Corporation, 173 Edgerton, Howard K., xi
Decatur Fertilizer, 81 Edgerton, John, xii, 49–50, 91–93,
Declaration of Principles (1937), 137, 247
144, 151 and Black-Connery wage-hour bill of
Deering-Milliken, 285 1937, 138–139
deindustrialization, 282–283 and Democratic Party, 117–118
Dell Computer, xiv and dispute with Maury
Democratic Party, 117, 165, 258 Maverick, 86–89
and business leaders, 28, 52 and FLSA hearings, 149n35
conservatism of, 4, 230, 232, 276–278 founding of SSIC, 30
Democrats-for-Willkie, 230 and Harriman Hosiery case, 104–105
divisions on FEPC, 208–209 and Herbert Hoover, xii, 117, 121n50
and the Fair Deal, 216, 219 and immigration, 110
Hoovercrats, 7 and infant industry rhetoric, 45
1938 midterm election, 151–152, 230 and labor relations, 109–111
1948 election, 236–237 management practices of, 31, 106
1950s divisions, 262–263 as NAM president, 3
in the South, 6 and New Deal administrators, 53–56
SSIC leaders and, 30–31, 62, 83, 92, and the NLRA, 112–113
101, 120–124, 127, 165, 196, 197, and NRA revision, 73–75, 76–77, 79–80
205, 212, 231–234, 237, 259, 275 and NRA wage differentials, 44
Democrats, southern, 165, 205, 230, 235, press coverage of, 105
257, 260, 262, 266, 285 and proposed Supreme Court
blocking of Tydings Amendment, reorganization, 122
114n37 resignation from SSIC, 148
divisions in North Carolina, 141 rumors about death of, 148
and the Fair Deal, 216 Eisenhower, Dwight, 240, 257
and FEPC, 208 1952 election, 258
and the FLSA, 151 southern support for, 277
and foreign trade, 262 SSIC leaders and, 259, 261, 285
and the New Deal, 59, 84, 120,145 Ellender, Allen, 146
1938 election, 152 Ezekiel, Mordacai, 58
1944 election, 233
and 1952 election, 258 Fair Employment Practices Commission
opposition to civil rights, 212, 251 (FEPC), 203, 205–215
voting during World War II, 193n52 establishment by executive order, 206
and the Wagner Act, 113, 122 New York law for, 214
Dewey, Thomas E., 234, 256n25 political debates, 208–209
Division of Subsistence Fair Labor Standards Act (FLSA), 123,
Homesteads, 70 132, 163, 193, 203
Dulles, John Foster, 266 attempts to modify, 152–158, 194–196
Dunkleberger, Alvand, 198 charges of southern discrimination,
DuPont Corporation, 1, 134n6 155–156
DuPont, Irénée, 103, 117 votes to pass, 150–151
314 Index
fertilizer industry Goldwater, Barry, 261, 268, 279

and NRA revision, 81 and business leaders, 279, 281
SSIC membership, 35 and SSIC, 275–276
Fight for Free Enterprise (FFE), 221 Gossett Mills, 76
Filene’s, 99 Gossett, B. B., 27, 76
Firestone Corporation, 244 Graham, Frank Porter, 156, 169, 183,
Firestone Tire and Rubber Company, 1 185, 208
forest products industry, 82 Graves, Dixie Bibb, 149
FLSA criticism, 141 Graves, John Temple II, 105, 118, 124,
and freight rate classification, 176 179, 183, 199
NRA representation, 46
and NRA revision, 80 Hall, Fitzgerald, 139, 148, 174
southern furniture production, 35 response to the Report on Economic
southern opposition to FEPC, 209 Conditions of the South, 159
SSIC membership, 34–35, 36, 46, Hamilton, Alexander, 39, 77
282, 284 Hancock, Alex, 177
and the Wagner Act, 107 Hanes, John W., 230, 230n49
Foundation for Economic Education (FEE), Hanes, P. H., 143, 230n49
178, 182, 219, 222, 272 Harrigan, Anthony, 6n8, 15, 255, 268, 287
Frankfurter, Felix, 77, 121n50 criticism of internationalism, 288
free enterprise, 270–278, 286, 290 “Sensing the News” radio and print
Barry Goldwater’s endorsement column, 248
of, 268 SSIC public relations role, 273, 284–285
educational materials for, 249, 250 Harriman Hosiery Mills, 102–105
educational materials regarding, 228 Harriman, Henry, 82
and freight rates, 175, 179, 184 Harrison, Pat, 229
Hayek as inspiration for, 245 Hartmann Luggage, xi
John Temple Graves II use of, 200 Hartsfield, William Berry, 216
Maury Maverick’s use of, 192n50 Hayek, Friedrich, 205, 229, 244, 245–246, 276
and modern Republicanism, 259 Hill, J. Lister, 135, 176, 208, 263
in party politics, 238, 277, 278 appointment and election to Senate, 149
and the South, 13, 222, 243 Hill, James B., 165
SSIC use of, 8, 8n10, 9, 16, 161, 167, Hoover, Herbert, 24, 77, 120, 121n50
175, 183, 200, 203, 215, 217, Humphrey, Hubert, 236
221–223, 236, 239, 265, 269
use to block the FEPC, 205, 210 Illinois Central Railroad, 181
and war production, 190, 191, 195 Institute for Research in Social Science
(UNC-Chapel Hill), 66
Gardner, O. Max, 27, 141 International Paper Company, 177
Garner, John N., 121, 233 Interstate Commerce Commission (ICC),
Gault, Francis B., 81, 82 43, 176
Gem-Dandy Garter Company, 60 investigation of rate discrimination,
General Agreement on Tariffs and Trades 1941–1944, 172
(GATT), 266 1945 ruling on freight rate equalization,
General Electric, 99, 244, 285 182–183
General Motors, 285 southern rates in the 1920s and 1930s,
General Motors Corporation, 2, 134n6 169–170
George, Walter, 87, 229, 231
Gilbert, C. C., 30, 46, 50, 117, 119, 146, Jefferson, Thomas, 77
191, 194 Johnson, Hugh S., 39, 52–54, 86, 99, 103
Glass, Carter, 84–85, 114, 122, 229 Johnston, Olin, 207
Goethe, Charles M., 284 Jones, Sam H., 164, 168
Index 315
Kennedy, John F., 267 McReynolds, Samuel, 87

Key, V. O., 286 Mebane Furniture Company, 107
Keynes, John Maynard, 149 Mellett, Lowell, 159
critics of Keynesianism, 178 Miller, J. Clifford
King, William, 79 and Richmond City Democratic
Kirk, Russell, 250–251, 255 Committee, 276–278
Milliken, Roger, 285
Labor Management Relations Act of Mims, Edwin, 69
1947 (Taft-Hartley), 203, 212, 213, Monsanto Chemical Company, 166, 181
221, 237 Mundt, Karl, 257–258
effects on southern unionization, 228–229 Murray, James, 191
Kennedy-Ervin revision proposal, 260
passage of, 227 Nashville, Chattanooga & St. Louis
“right to work” laws, 226, 228 Railroad, 159, 174
Labor Management Reporting and National Association of Cotton
Disclosure Act of 1959, 261 Manufacturers (NACM), 30
labor unions National Association of Furniture
and the SSIC, 118 Manufacturers (NAFM), 80
strikes by, 115 National Association of Manufacturers
LaFollette, Jr., Robert M., 79 (NAM), xii, 3, 4, 7, 12, 37, 45, 95, 97,
Lambeth, J. Walter, 150 99, 105, 113, 118, 134n6, 148, 167,
Larus & Brother Company, 37 211, 219, 222, 227, 245, 247, 248,
Lebanon Woolen Mill, xi, xii, 3, 31–32, 46, 256, 265, 285
106, 109–111, 110n29 National Council for a Permanent
Lend-Lease, 194 FEPC, 206
Lewis, John L., 99, 103, 199, 226 National Industrial Recovery Act (NIRA),
Long, Charles, 210 21, 28, 30, 82, 96, 107, 108
Long, Earl K., 234 Section 7a, 29, 98–103, 111, 116, 221
Long, Huey, 146, 232, 234 Supreme Court challenge, 86
Longino & Collins, 212 National Labor Board (NLB), 98–103,
Longino, R. Kirby, 212, 235, 237–238 104, 106
Long-Lewis Hardware Company, 210 National Labor Relations Act (NLRA,
Louisiana Central Lumber Company, 156 or Wagner Act), 97–98, 112–115,
Louisville & Nashville Railroad, 165, 181 185, 210
Love, J. Spencer, 96, 108–110 business criticism of, 224–226
Lowndes, William, 281 historians’ analysis of, 112
lumber industry. See forest products House vote for, 113
industry Tydings Amendment to, 114
Luxe Timepieces, xi National Labor Relations Board (NLRB),
111, 225
MacArthur, Douglas, 257 National Recovery Administration (NRA),
MacRae, Hugh, 69–70 21–22, 105, 116, 137, 170
Mager, Margaret, 47–48, 156, 170n12 Blue Eagle, 21, 86
Manufacturers’ Record, 110, 241 code authorities and southern
Martin, Joseph W., 198, 264 representation, 45–48
Mattei, Albert C., 178, 182 and Harriman Hosiery Mills case, 102–105
Maverick, Maury, 83, 86–89 invalidation by Supreme Court, 133
May, Andrew J., 92 and labor relations. See National
McDonald, Walter R., 173 Industrial Recovery Act (NIRA):
McEwen Knitting Company, 109 Section 7a
McKellar, Kenneth D., 87, 114 and southern cotton glove
McMillan, Edward J., 155 industry, 48–49
316 Index
National Recovery Administration (NRA) Redmond, Paul, 249

(cont.) and 1952 election, 258
and southern manufacturers, and two-party South, 258
29–30, 39–42 Reece, B. Carroll, 87
and SSIC formation, 22 regional wage differentials
and SSIC leaders, 53–54 and natural causes, 42–45
SSIC and revision of, 77–83 Report on Economic Conditions of the
National Review, 15, 268, 284, 288, 295 South, 127, 131, 153, 163, 179
National War Labor Board (NWLB), SSIC response to, 158–160
185, 193 Republican Party, 237, 276n8
New Deal coalition, 7, 8, 55, 208 internal divisions, 259, 262
labor support for, 127 in the South, 121n50, 122n51
and southern business, 59, 84 and southern strategy, 287
New England Council, 25, 32 and the SSIC, 151–152, 198–199,
Newell, Jake, 198 234–235
Nixon, Richard, 277 SSIC leaders and, 257–258
North Atlantic Free Trade Agreement Reynolds, Robert, 141
(NAFTA), 15 Ribe, A. J., 174
Richmond Fredericksburg & Potomac
Odum, Howard Railroad, 278
on the Report on Economic Conditions Rockefeller, Nelson, 280
of the South, 159 Rockwell, Norman, 164
Office of Price Administration (OPA), 193 Rocky Mount Mills, 157
Office of Production Management Roosevelt, Eleanor, 131
(OPM), 187 Roosevelt, Franklin D., 28, 60, 78, 84,
99, 103, 122, 131, 145, 152, 158,
paternalism 164, 190
appearances in political rhetoric, 113, Roosevelt, Theodore, 77
138, 146, 147, 204 Russell, Richard, 87, 211, 239, 241
historians’ discussion of, 6, 7, 33, 52
of industrialists, 5, 100, 110, 153, 203 Schechter Corp. v. United States, 133
industrialists’ claim that labor unions Sears-Roebuck, 278
practiced, 112 Sensing, Thurman, 202, 205, 229, 285, 287
of the mill village, xii, 12, 16, 27, 116, and anticommunism, 213
132, 241 “Down South” column, 248
of planters, 5 and Eisenhower presidency, 259
Patterson, Grove, 89 FEPC response, 206
Pelzer Manufacturing Company, 58 and freight rate revision, 175–176, 179
Pepper, Claude, 149, 240 and Hayek, 245–246
Perkins, Frances, 56, 76, 133 1948 trip to Great Britain, 250
and segregation, 211–213
R. J. Reynolds Tobacco Company, 37, 285 “Sensing the News” print and radio
railroad freight rates column, 272
charges of southern discrimination, and States’ Rights Democratic Party,
165–167 238–239
class rates, 170–171 Sheppard, C. C., 156
commodity rates, 170–171 Shook, P. G., 263
Ramspeck, Robert, 87 Sloan, George, 26, 29
Randolph, A. Phillip, 206 Smaller War Plants Corporation
Rankin, John E., 240 (SWPC), 186
Reciprocal Trade Agreements Act (RTAA) Smith, Alfred E., 120
1955 renewal, 262 Smith, Edward, 57, 229
Index 317
Smith, Howard W., 277, 278 and defense industry, 12

Smith, J. Craig, 265 historians’ discussion of, 11, 13,
Smith, Ralph, 90 16n23, 274
Smith-Connally War Labor Disputes Act, Kevin Phillips’ definition of, 13
222n34 role of southern manufacturers in
Smyth, Ellison, 58 creating, 16n23
Southeastern Council, 179 and southern identity, 274
Southern Agrarians (Vanderbilt), 67, 252
and the SSIC, 71–72 Taft, Robert, 209, 234, 240, 256n25
Southern Conference for Human Welfare Talmadge, Eugene, 260
(SCHW), 131, 153 Taylor, Tyre, 83–84, 141, 156, 188, 218,
SSIC representation at, 152–155 226, 257, 260, 262, 275, 279
Southern Furniture Manufacturers Tennessee Federation of Labor, 119
Association (SFMA), 45, 80 Tennessee Valley Authority (TVA), 77
Southern Garment Manufacturers freight rate investigation, 1943, 174–175
Association, 45 Terry, Prentiss, 162, 179
Southern Governors Association (SGA), at SCHW, 152–155
160, 171, 178 textile industry
and freight rates, 167–168, 180 capital mobility, 11
Southern Pine Association, 45 complaints about the FLSA, 155–156
Southern States Industrial Council (SSIC) economic conditions of, 24–26
educational program, 1950s, 249–251 and global competition, 264–265
FEPC response, 205–215 as a sick industry, 144
financial difficulties, 248 SSIC membership, 36, 125–126
founding of, 30 under the NRA, 31–32
lobbying expenditures, 86–89, 249 wages and working conditions
membership, 34–38, 81, 95, 124, 284, in, 26–28
285–286 textile manufacturers. See textile industry
name change to USBIC, 283–284 Textile Workers’ Organizing
public relations, 6, 49, 95–96, Committee, 119
115–116, 119, 153, 162, 205, 246, Thomas, Albert, 140
248–250, 284 Thurmond, Strom, 203, 237, 266, 281
and the Republican Party, 276 Tillman, Benjamin, 59
and segregation, 256 Tobacco industry
and Truman, 257 SSIC membership, 36–37
Southern Transportation Conference, Tonelson, Alan, 15, 289
172–174 Truman, Harry S., 206, 211, 235–236, 257
Sparkman, John, 263 Tugwell, Rexford, 57–58, 77, 201
St. Lawrence Seaway proposal, 189–190 Turner, Roscoe, 284
Stahlman, James, 121, 197 Tydings, Joseph, 145
Eisenhower support, 267
and Goldwater, 281 Union Bag & Paper Company, 166
Nixon support, 280–281 United Methodist Church, 123
Willkie support, 230 United Mine Workers (UMW), 99
Standard Fertilizer, 81 United States Business and Industrial
Standard Oil, 99 Council (USBIC), 12, 14, 15,
States’ Rights Democratic Party, 203, 288–290
236–239 United States Chamber of Commerce, 31,
Statesville Chair Company, 107 82, 119, 134n6, 137, 219, 248
Sullens, Frederick, 122 and free enterprise, 134
Sunbelt, 14, 245 local branches of, 108
“business climate”, 16, 267 support for free trade, 265
318 Index
United Textile Workers of America (UTW), Wagner Act. See Labor Management
52, 98, 115, 126 Relations Act of 1947
(Taft-Hartley)
Vandenberg, Arthur, 145 Wagner, Robert F., 99, 111
Vanderbilt University, xi, 65, 67, 68, 72, 97, 280 Wallace, Henry, 235
Virginia Transit Company, 278 Wallner, Thomas, 190, 195
Virginia Young Democratic Club, 83, 84 War Production Board (WPB), 186, 193
Vogtle, Alvin, 173 Warren, Earl, 272
Volkswagen, 2 Weaver, Richard, 254
Willkie, Wendell, 198
wage differentials. See regional wage Woodruff, Truman, 63
differentials World War II
Wages and Hours Administration (Dept. of and southern development, 168, 185
Labor), 156–157 Wright, T. Asbury, 103

(Cambridge Studies On The American South) Katherine Rye Jewell-Dollars For Dixie - Business and The Transformation of Conservatism in The Twentieth Century-Cambridge University Press (2017) PDF

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(Cambridge Studies On The American South) Katherine Rye Jewell-Dollars For Dixie - Business and The Transformation of Conservatism in The Twentieth Century-Cambridge University Press (2017) PDF

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DOLL ARS FOR

Organized in 1933, the Southern States Industrial Council’s (SSIC)

Katherine Rye Jewell is Assistant Professor of History at Fitchburg

Cambridge Studies on the American South

University Printing House, Cambridge CB2 8BS, United Kingdom

Cambridge University Press is part of the University of Cambridge.

For Mrs. B. K. Hall

List of Figures page x

Introduction: The New South and the New Deal 1

Part I Working within the New Deal 19

1 The New South and the NRA 21

Part II Free Enterprise and the South 129

4 Creating the Nation’s Economic “Opportunity” No. 1 131

1 “No One Could Object to That,” Birmingham

The Lebanon Woolen Mill employed generations of my family. Founded

a student at Vanderbilt, one of my professors, David Carlton, told me of

The marketing of ambiguously regional nostalgia has not solved the

argument, and I have benefited tremendously from his insights. Bruce

at various stages of this project, including Elizabeth Tandy Shermer,

AAA Agricultural Adjustment Act

Introduction: The New South and the New Deal

1 In 1921, Broadus Mitchell argued boosters had philanthropic intentions in attracting

2 Introduction: The New South and the New Deal

General Motors, or later by Volkswagen and BMW, overshadowed what

2 Kari Frederickson, Cold War Dixie: Militarization and Modernization in the American

Introduction: The New South and the New Deal 3

responded to the New Deal by swapping regional and interest-​based

4 Introduction: The New South and the New Deal

and trade associations to represent the South’s particular and peculiar

Introduction: The New South and the New Deal 5

6 Introduction: The New South and the New Deal

manufacturers looked outward, toward the nation. Their conservatism

Introduction: The New South and the New Deal 7

8 Introduction: The New South and the New Deal

Part I of this book opens with Dixie’s manufacturers mobilizing

Introduction: The New South and the New Deal 9

to advocate for federal economic policies that would benefit southern

The South’s traditionalists, particularly the intellectual spokesmen among them

10 Introduction: The New South and the New Deal

Introduction: The New South and the New Deal 11

12 Introduction: The New South and the New Deal

Introduction: The New South and the New Deal 13

free enterprise –​the nation’s best economic opportunity, not anymore its

14 Introduction: The New South and the New Deal

Introduction: The New South and the New Deal 15

The USBIC also continued to work with the conservative movement

policy advocacy distanced it from mainstream business organizations, which tend to

Identity, 1865–​1915 (Chapel Hill: University of North Carolina Press, 2014); Richard

16 Introduction: The New South and the New Deal

Introduction: The New South and the New Deal 17

prompted by the redefinition of the South’s economy and promotion

25 Kim Phillips-​Fein, “Conservatism: A State of the Field,” Journal of American History, 98,

WORKING WITHIN THE NEW DEAL

We’ve hocked our Sunday pants to please the NRA,

The New South and the NRA

22 The New South and the NRA

The New South and the NRA 23

on code boards and thereby preserve and advance wage differentials.

24 The New South and the NRA

The Southern Textile Industry

explains, “Development … is a set of ideal social goals … it aims to feed everyone;

The Southern Textile Industry in the Depression 25

power or organizational backing to challenge mill owners, who often met

Part I Working within the New Deal 19

Part II Free Enterprise and the South 129

responded to the New Deal by swapping regional and interest-based

free enterprise –the nation’s best economic opportunity, not anymore its

Identity, 1865–1915 (Chapel Hill: University of North Carolina Press, 2014); Richard

25 Kim Phillips-Fein, “Conservatism: A State of the Field,” Journal of American History, 98,

because it endorsed “government-enforced ‘business self-regulation,” fulfilling hopes for

National Market and the Beginnings of Industrialization in North Carolina,” 73–98;

a largely southern-based industry, it did not suffer from nonsouthern

The Birmingham Age-Herald published a cartoon in February 1934

36 Shaffer, In Restraint of Trade, 202– 205. Pamela C. Edwards, “Entrepreneurial

(Durham, NC: Duke University Press, 1960), 393–394.

by people of “Anglo- Saxon blood,” believing in one God and “one