Time is running out on the Carter administration's efforts for voluntary control of inflation.
After nearly two years of false starts with a variety of voluntary anti-inflation programs, the White House has only three months left to come up with an effective plan for holding down wage and price increases before the start of next year's major new round of Union contract bargaining.
The Carter administration has now reached the same point in the three-year cycle of contract bargaining that the Nixon administration waited for in 1971 before imposing wage and price controls. The current lull between the end of the bargaining round that began in 1976 and the start of next year's new negotiating cycle is the only opportunity the White House has of intervening in contract negotiations during the President's first term without creating explosive weage inequities among the major unions.
The biggest concern of both the White House and most major union leaders is next year's negotiations between the Teamsters and the trucking industry over a new national trucking agreement. The outcome of these negotiations will basically set the wage pattern for the next three years.
"We've already told the administration that our members care a whole lot more about what the Teamsters do (at the bargaining table) than they do about what the government has to say about controlling inflation. "says one key union leader involved in next year's bargaining round.
In addition to the 528,000 Teamsters whose contracts expire in the trucking industry March 31, major contracts expire next year in the petroleum, construction, rubber, clothing, electrical manufacturing, meatpacking and auto industries.
The wage "patterns" set in next year's contract negotiations will then serve as the target for all other industries - including basic metals - during the next two years. And this is what clearly worries administration economists.
From almost the first day of the Carter administration two years ago, the major anti-inflation target has been the Teamsters. In his earliest public interviews, Charles L. Schultze, chairman of the President's Council of Economic Advisers, has talked of the need to break the "wage momentum" in the next round of contract bargaining.
Since then, however, the administration has been unable to have any meaningful discussions with organized labor about an effective anti-inflation policy. "We could never even agree on the basic causes of inflation," says an administration official.
In the meantime, the administration has basically sat back and watched while the United Mine Workers, after a long strike, reached agreement on a new contract calling for wage increases of nearly 40 percent over the life of the contract and settlements totaling 35 percent for the major railroad unions.
The AFL-CIO has steadfastly insisted that the administration would first have to demonstrate its willingness to deal with rising prices before it would consider cooperating with the government on a wage control policy. Noting the fast rise in prices earlier this year, the labor federation warned in its policy statement on the economy last Spring that: "Price increases - are the principal economic fact of life which govern the wage levels unions must seek."
The policy resolution went on to note that "we candidly told the President and his economic advisers that the administration's success in encouraging American business and the canking community to hold the line on prices and interest rates will be naturally reflected in collective bargaining settlements."
The Teamsters, the nation's largest independent union, has also warned that it will be watching the administration's efforts to control prices as a measure of its demands at the bargaining table. But the Teamsters present the administration with another major problem that it bound to have a spillover effect on th upcoming negotiations.
For the past two years, the Labor Department has been trying to clean up the union's scandal-ridden pension funds. The clean up effort has resulted in a variety of legal actions and could eventually produce indictments against some union leaders involved in the pension fund. That investigation has resulted in an almost total breakdown in the relationship between the government and the Teamsters.
As a result of the government's pension investigations, the union has had little to do with Labor Secretary Ray Marshall and the White House has publicly shunned Teamster President Frank E. Fitzsimmons. Thc consequence has been an almost total absence of any coherent labor relations policy toward the upcoming trucking negotiations, according to administration officials.
"How the hell are you going to get a settlement with the Teamsters when Fitz wants an invitation to the White House and Marshall wants to send him to jail," says a veteran government labor relations expert.
Adding to the White House problems are the deteriorating relationship between the administration and organized labor in general over the President's failure, in the eyes of many union leaders, to deliver on his campaign promised for social legislative changes as well as labor's own special interest goals.
That deterioration has already forced the administration to abandon earlier hopes of creating an anti-inflation program patterned after the Korean War controls experience. Under such a program, the White House had hoped to set up a series of tri-partite committees in major industries that would be use to help labor and management work out their problems with the government in exchange for wage and price moderation.
The White House was also counting on the help of the United Auto Workers union and its president, Douglas Fraser, in the push for wage moderation. But Fraser has since become disenchanted with the administration for its failure to push for the social programs outlined in the Democratic Party platform and is in no mood to help.
With the industry committee avenue now closed, the administration is talking about a program of wage and price guidelines patterned after the program used by the Kennedy and Johnson administrations in the 1980s. For wages the administration is considering a guideline tied to the rise in the cost of living.
So far, however, labor is having no part of the guidelines. After a briefing by administration economists this week, union leaders remained privately adamant in their opposition to any attempt at setting a national wage standard.
And a negotiator for a major corporation coming up for contract renewal next year warned: "The administration is crazy if it thinks any company will even consider offering increases less than the cost of living plus something for productivity.
Without commenting on this week's meeting at the White House, a top union economist repeated the warning the the administration would have to do something about recently rising prices before it could expect any help from labor. "Most of the price increases this year have little relationship to wages," he said, citing the sharp rise in interest rates and the cost of food and energy.
Another key union official called the latest anti-inflation proposals the act of "desperate men." He said his union has already told the White House it would be willing to make wage sacrifices only if there was evidence that other areas of the economy were also being forced to make sacrifices.
The administration has scheduled a series of meetings with the key labor leaders in the next few weeks in an effort to convince the union officials of the need for cooperation to curb inflation. So far, however, the outlook for cooperation is bleak.
That bleakness was reflected was reflected by the administration in its meetings last week with labor. After making a plea for cooperation on a voluntary basis, one top White House adviser warned labor that unless the unions cooperated the administration might have to seek a "political solution." He then, according to others at the meeting, noted that recent public opinion polls showed a growing support for wage and price controls as a way to deal with inflation.