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Unspoken Implication. Connally's main job at the press conference was to allay the suspicions of A.F.L.-C.I.O. President George Meany. Fearing above all that an unfriendly Republican Administration would overrule the wage decisions of a tripartite board, Meany had demanded that the Pay Board be completely independent of the Government. He had initially decided to cooperate with the program, but withdrew his support even as President Nixon was speaking Thursday night. Briefings of newsmen by White House aides had led Meany to believe that Connally's COLC would exercise veto power over the Pay Board.
Connally adroitly put Meany on the spot before the nationwide TV audience. Asked if Meany would be on the Pay Board, Connally happily issued a public invitation: "I expect him to be. I hope he will be. He's been asked. I can't imagine that he couldn't make a great contribution." The obvious, but carefully unspoken implication was that if Meany declines to serve and sets organized labor to fighting the program in the courts or on the picket lines, he will be largely to blame for the failure of the most promising effort yet to check inflation.
Whether Meany will be won over is still highly doubtful. He has reserved his decision, pending a meeting this week of the A.F.L.-C.I.O.'s 35-man executive council. Leonard Woodcock of the United Auto Workers and Frank Fitzsimmons of the Teamsters, who head the two largest unions in the country, will also attend, even though their unions are not in the A.F.L.-C.I.O. Both have been asked to sit on the Pay Board along with Meany, although Woodcock has echoed Meany in declining to do so unless he is assured that the board will be independent.
The labor leaders, however, know that they run an immense risk of outraging public opinion if they do not at least go on the Pay Board and see if it can be made to work. If they do join the Pay Board, there will still be rich potential for conflict. Meany intends to demand that all pay raises held up by the freeze be paid when it ends, a step that the White House has said will not be permitted.
Auspicious Indicators. If Nixon and Connally can win labor's grudging acceptance, the stabilization program stands at least a fair chance of success. Economically, Phase II is being set up at an auspicious time. Wholesale prices in September showed their largest drop, 0.4%, in five years. The unemployment rate inched down from 6.1% to 6%—nothing to arouse wild cheers, but still a move in the right direction.
A major imponderable is the attitude of the President. The machinery for Phase II has been designed to operate at not one, but two removes from the White House. In part, that is not a bad idea. Interference by the head of Government eventually undermined the authority of Britain's Prices and Income Board in the 1960s. The President and his aides shaped the Phase II machinery after listening to British veterans of that board advise that the wage-price mechanism be insulated from political meddling.