On this day in 1944, the federal government seizes Montgomery Ward. It was the second time that the government seized the company during FDR’s administration.

The use of federal power was brazen, to say the least. But FDR had spent his entire presidency expanding the scope of federal power. Perhaps his audacity wasn’t so surprising after all.

During the war years, FDR reinstituted a WWI-era War Labor Board. He didn’t want worker strikes to affect the war effort. His Labor Board was supposed to prevent such a situation by helping to arbitrate labor disputes.

At Montgomery Ward, none of this went over so well. Indeed, there was a dispute about whether the company’s products even affected the war—at all. Should they really be subject to the decisions of this Labor Board?

The retailer had its own set of problems to deal with, even without FDR’s demands.

Montgomery Ward had survived the Great Depression, but the company had struggled to keep up with competitors such as Sears. In order to save his company, CEO Sewell Avery took many cost-cutting actions: He saved the company financially, but his actions also led to a series of disputes with the company’s workers. By April 1944, the company’s labor agreements were expiring, which meant the workers could again go on strike. FDR jumped in, ordering Avery to sign a new contract or to have his company seized. Avery refused.

The story continues here: https://www.taraross.com/post/tdih-montgomery-ward

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