The Walsh Committee was created to review industrial relations and scrutinize US labor laws. The commission studied work conditions throughout the industrial United States between 1913 and 1915. The final report of the Commission, published in eleven volumes in 1916, contain tens of thousands of pages of testimony from a wide range of witnesses, including scores of ordinary workers, and the titans of capitalism, including Daniel Guggenheim, George Walbridge Perkins, Sr. (of U.S. Steel), Henry Ford, and Andrew Carnegie. During the tenure of this committee, tax-exempt foundations were also examined. Partial findings were that,
“the lives of millions of wage earners are subject to the dictation of a relatively small number of men… The concentration of ownership and control is greatest in the basic industries upon which the welfare of the country must finally rest. This control is being extended largely through the creation of enormous privately managed funds for indefinite purposes, herein- after designated “foundations,” by the endowment of colleges and universities, by the creation of funds for the pensioning of teachers, by contributions to private charities, as well as through controlling or influencing the public press (namely, the Rockefeller and Carnegie Foundations). The following was revealed: “A number of witnesses testified that colleges had surrendered their religious identifications in order to comply with foundation requirements to receive grants…“
(William M. Bowen, Jr, Globalism America’s Demise, 1984, p.40)
In studying labor conditions and the treatment of workers by the major U.S. industrial firms, they eventually examined tax exempt foundations, which were interlocked with them. “Starting with a study of labor exploitation, it [the Commission on Industrial Relations] went on to investigate concentrations of economic power, interlocking directorates, and the role of the then relatively new large charitable foundations (especially of Carnegie and Rockefeller) as instruments of power concentration,” wrote Rene Wormser, who served as General Counsel to the Reece Committee, which was a congressional committee that investigated the Tax-exempt Foundations from 1953 to 1955. (Source)
During the commission hearings, future Supreme Court Justice Louis D. Brandeis testified on January 23, 1915, that he was seriously concerned about the emerging danger of such a concentration of power. He said,
“When a great financial power has developed… which can successfully summon forces from all parts of the country… to carry out what they deem to be their business principle… [there] develops within the State a state so powerful that the ordinary social and industrial forces existing are insufficient to cope with it.”
“Control is being extended largely through the creation of enormous privately managed funds for indefinite purposes, hereinafter designated ‘foundations'” declared Mr. Basil M. Manly, director of research for the commission. The commission’s report concluded that, “As regards the ‘foundations’ created for unlimited general purposes and endowed with enormous resources, their ultimate possibilities are so grave a menace… [that] it would be desirable to recommend their abolition.”
Congress has declared that these foundations, which can be used to fund anything, should be eliminated because they are potentially destructive to the republic. According to Rene Wormser, even though these congressional findings occurred in 1915, the time period is irrelevant – they are still quite important. He stated, “Under totally different economic and social conditions, the findings of 1915 are still significant.”
From the report:
20. The charters of these foundations, with their almost unlimited powers, were granted under conditions of such laxity that it has been testified by an eminent legal authority who made an extensive investigation that those granted by New York State are legally defective and unconstitutional. Furthermore, evidence developed by the hearings of the commission showed that in increasing the number of its trustees without complying with the requirements of the law governing corporations the Rockefeller Foundation has already been guilty of a breach of the law.
21. These foundations are subject to no public control, and their powers can be curbed only by the difficult process of amending or revoking their charters. Past experience, as, for example, in the case of the insurance companies, indicates that the public can be aroused only when the abuses have become so great as to constitute a scandal.
22. The entrance of the foundations into the field of industrial relations, through the creation of a special division by the Rockefeller Foundation, constitutes a menace to the national welfare to which the attention not only of Congress but of the entire country should be directed. Backed by the $100,000,000 of the Rockefeller Foundation, this movement has the power to influence the entire country in the determination of its most vital policy.
25(b). The abandonment by several colleges and universities of sectarian affiliations and charter clauses relating to religion in order to secure endowments from the Carnegie Corporation and pensions for professors from the Carnegie Foundation for the Advancement of Teaching. It would seem conclusive that if an institution will willingly abandon its religious affiliations through the influence of these foundations, it will even more easily conform to their will any other part of its organization or teaching.
WE FIND THE BASIC CAUSE OF INDUSTRIAL DISSATISFACTION TO BE LOW WAGES ; OR, STATED IN ANOTHER WAY, THE FACT THAT THE WORKERS OF THE NATION, THROUGH COMPULSORY A.ND OPPRESSIVE METHODS, LEGAL AND ILLEGAL, ARE DENIED THE FULL PRODUCT OF THEIR TOIL.
We further find, that unrest among the workers in industry has grown to proportions that already menace the social good will and the peace of the Nation. Citizens numbering millions smart under a sense of injustice and of oppression, born of the conviction that the opportunity is denied them to acquire for themselves and their families that degree of economic well-being necessary for the enjoyment of those material and spiritual satisfactions which alone make it worth living.
Bitterness, bred of unfilled need for sufficient food, clothing, and shelter for themselves and their wives and children, has been further nourished in the hearts of these millions by resentment against the arbitrary power that enables the employer, under our present industrial system, to control not only the workman’s opportunity to earn his bread, but oft times, through the exercise of this power, to dictate his social, political, and moral environments By thwarting the human passion for liberty and the solicitude of the husband and father for his own, modern industry has kindled a spirit in these dissatisfied millions that lies deeper and springs from nobler impulses than physical need and human selfishness.
Among these millions and their leaders we have encountered a spirit religious in its fervor and in its willingness to sacrifice for a cause held sacred. And we earnestly submit that only in the light of this spirit can the aggressive propaganda of the discontented be understood and judged.
The extent and depth of industrial unrest can hardly be exaggerated. State and national conventions of labor organizations, numbering many thousands of members, have cheered the names of leaders imprisoned for participation in a campaign of violence, conducted as one phase of a conflict with organized employers. Thirty thousand workers in a single strike have followed the leadership of men who denounced government and called for relentless warfare on organized society. Employers from coast to coast have created and maintained small private armies of armed men and have used these forces to intimidate and suppress their striking employees by 153
Considering the whole field of American industry, there are almost infinite variations of relationship between employers and employees, ranging from the individual worker hired by a single employer, as deporting, imprisoning, assaulting, or killing their leaders. Elaborate spy systems are maintained to discover and forestall the movements of the enemy. The use of State troops in policing strikes has bred a bitter hostility to the militia system among members of labor organizations, and States have been unable to enlist wage earners for this second line of the Nation’s defense. Courts, legislatures, and governors have been rightfully accused of serving employers to the defeat of justice, and, while counter charges come from employers and their agents, with almost negligible exceptions it is the wage earners who believe, assert, and prove that the very institutions of their country have been perverted by the power of the employer. Prison records for labor leaders have become badges of in the eyes of many of their people, and great mass meetings throughout the Nation cheer denunciations of courts and court decisions.
To the support of the militant and aggressive propaganda of organized labor has come, within recent years, a small but rapidly increasing host of ministers of the gospel, college professors, writers, journalists, and others of the professional classes, distinguished in many instances by exceptional talent which they devote to agitation, with no hope of material reward, and a devotion that can be explained only in the light of the fervid religious spirit which animates the organized industrial unrest.
We find the unrest here described to be but the latest manifestation of the age-long struggle of the race for freedom of opportunity for every individual to live his life to its highest ends. As the nobles of England wrung their independence from King John, and as the tradesmen of France broke through the ring of privilege inclosing the Three Estates, so to-day the millions who serve society in arduous labor on the highways, and aloft on scaffoldings, and by the sides of whirring machines, are demanding that they, too, and their children shall enjoy all of the blessings that justify and make beautiful this life.
The unrest of the wage earners has been augmented by recent changes and developments in industry. Chief of these are the rapid and universal introduction and extension of machinery of production, by which unskilled workers may be substituted for the skilled, and an equally rapid development of means of rapid transportation and communication, by which private capital has been enabled to organize in great corporations possessing enormous economic power. This tendency toward huge corporations and large factories has been furthered by the necessity of employing large sums of capital in order to purchase and install expensive machinery, the use of which is practicable only when production is conducted on a large scale.
Work formerly done at home or in small neighborhood shops has been transferred to great factories where the individual worker becomes an impersonal element under the control of impersonal corporations, without voice in determining the conditions under which he works, and largely without interest in the success of the enterprise or the disposal of the product. Women in increasing numbers have followed their work from the home to the factory, and even children have been enlisted.
Now, more than ever, the profits of great industries under centralized control pour into the coffers of stockholders and directors whoever have so much as visited the plants, and who perform no rvdce in return. And while vast inherited fortunes, representing zero in social service to the credit of their possessors, automatically treble and multiply in volume, two-thirds of those who toil from 10 to 12 hours a day receive less than enough to support themselves and their families in decency and comfort. From childhood to the grave they dwell in the shadow of a fear that their only resource their opportunity to toil will be taken from them, through accident, illness, the caprice of a foreman, or the fortunes of industry. The lives of their babies are snuffed out by bad air in cheap lodgings, and the lack of nourishment and care which they cannot buy. Fathers and husbands die or are maimed in accidents, and their families receive a pittance, or succumb in mid-life and they receive nothing.