Longshoremen's strike

Nearly immediately into his governorship, Merriam faced labor agitation, particularly by members of the International Longshoremen's Association on the docks of San Francisco. Beginning in May 1934, longshoremen along the West Coast walked off the job to strike, protesting against the ILA national leadership's negotiated settlements with transportation and cargo companies. Longshoremen demanded six-hour days, closed shops, and the right to unionize freely. Activity in the ports of San Francisco and Oakland ground to a halt. Teamsters soon joined the longshoremen in their walk-out. Popular support for the strikers also grew from various segments of the urban working-class, left unemployed by the Great Depression. By the strike's second month, violence had begun to break out along the Embarcadero as San Francisco Police clashed with the strikers during attempts to escort hired labor to the docks. Municipal officials accused the ILA's ranks filled with Communists and other left-wing radicals.

As governor, James Rolph had consulted with other West Coast governors such as Julius L. Meier of Oregon and Clarence D. Martin of Washington to bring in the U.S. Department of Labor in order to settle the dispute. After his unexpected death in June, these efforts were suspended. Furthermore, negotiations between the federal government and local ILA organizers failed to yield any agreement.

On July 5, 1934, as more attempts to open the Port of San Francisco were made by employers, hostilities between strikers, their sympathizers, and the police reached their zenith. Later known as "Bloody Thursday", San Francisco Police shot tear gas at strikers and sympathizers on Rincon Hill, followed by a charge on horseback. Later, protestors surrounded a police car and attempted to overturn it, but were met by gunshots in the air, and quickly afterwards, shots into the crowd itself. Later in the day, police raided an ILA union hall, shooting tear gas into the building and into other local hotels.

Merriam, only governor for a month, threw the state government into the fray. As reports of growing violence in San Francisco reached Sacramento by the minute, Merriam activated the California Army National Guard, deploying regiments to San Francisco's waterfront. In the weeks before "Bloody Thursday", Merriam had remained updated on the ongoing labor dispute, threatening only to activate the Guard if the situation grew too serious. Behind the public scenes, however, the Governor had confided to fellow Republicans that ordering the Guard into San Francisco would ruin him politically.^[7] The events of July 5, however, proved to be a turning point. In addition to the Guard's deployment, federal troops of the U.S. Army were placed on stand-by in the Presidio if the situation grew beyond the Guard's control.

Merriam also ordered the halt of construction on the San Francisco–Oakland Bay Bridge until the violence in San Francisco subsided.

Within the day, 1,500 Guardsmen armed with fixed bayonets and machine guns patrolled the waterfront, with an additional 5,000 state troops on reserve. Explaining to the United Press the following day, Merriam placed full blame of "Bloody Thursday" on the political Left. "The leaders of the striking longshoremen are not free from Communist and subversive influences...There will be no turning back from the position I have taken in this matter."^[8]

Following the funerals of the two men slain on "Bloody Thursday", the San Francisco Labor Council voted for a general strike. For four days from July 16 to July 19, the activity in the city ground to a halt. Mayor Angelo J. Rossi requested more Guardsman in the city, and in meetings with generals, plans were drawn to impose martial law over the entire city. However, with a heavily armed National Guard presence along the waterfront, violence did not break out again. In the meantime, the police, now backed up by National Guardsmen, raided and arrested militant and radical offices of the International Longshoremen's Association (ILA) leaders and sympathizers. By July 19, the General Strike Committee and the Labor Council ordered an end to the strike, demanding its picketers to accept arbitration from the federal government. With the strike broken by its less militant leadership, longshoremen grudgingly returned to work.

Less than three years later, Governor Merriam was called upon to intervene in another labor dispute, the Stockton Cannery Strike of 1937 in which one person died and 50 injured. Merriam refused to call up the National Guard this time, but did play a significant role in mediating between the two sides after the violence to get the canneries open and save the $6 million spinach crop.^[9]

1934 general election

In the aftermath of the Longshore Strike, Merriam was highly praised by the conservative San Francisco press for his perceived victory over the longshore strikers. During the strike, state Republicans nominated the Governor as its party nominee for the general elections that November. Merriam, however, had threatened not to deploy the California National Guard to San Francisco if the party would not nominate him.^[10]

Running against Merriam in the 1934 elections was former Socialist Party member Upton Sinclair, who had surprisingly won the nomination of the Democratic Party for governor. A third-party candidate, Raymond L. Haight of the Commonwealth-Progressive Party, also challenged Merriam.

During the campaign, Sinclair promoted the EPIC project, a socialist work program to ensure universal employment for all Californians, complete with the state control of factories, the opening of farm cooperatives and the creation of a cabinet-level California Authority for Production agency to oversee state employment.

The Commonwealth Party's Haight relied on centrists from the Democrats who believed that Sinclair had driven the party too far to the left.

Merriam's campaign rallied state conservatives into the so-called "Stop Sinclair" movement. Among supporters were MGM studio head Louis B. Mayer, media tycoon William Randolph Hearst, and Los Angeles Times publisher Harry Chandler. During the campaign, Mayer turned multiple studio lots in Los Angeles into propaganda machines, churning out fake newsreels to be played before feature-length films in the state. One notable newsreel included Soviets arriving in California to vote for Sinclair.^[11] Also during the campaign, Merriam frequented football games and public events, and on one occasion, attended a hospital talking to deaf mutes through an interpreter. Many such events were quickly publicized by the conservative newspaper press.^[7]

The result of the 1934 general elections saw Merriam defeating Sinclair with 48 percent of the vote, opposed to Sinclair's 37 percent. Haight garnered 13 percent.^[12] After the election, Merriam announced that the result was "[a] rebuke to socialism and communism."^[13]

The 1934 general election is generally remembered as one of the most hotly contested elections in California history. It has also been cited by political historians as one of the first modern elections, due to the various uses of popular media and rhetoric to both popularize and demonize candidates.

Rest of term

Upon beginning his first elected term, Merriam immediately faced an ever-shrinking state budget and growing deficit. In an effort that later angered many powerful conservative backers who had originally supported his 1934 candidacy, as well as challenging his own deep-seated conservativism, Merriam proposed to the Legislature a tax increase of nearly $107 million. The tax reform laws included instituting a state personal income tax modeled after the Federal Income Tax of 1934, which had been created by the Democratic-controlled Congress, and raising sales taxes to three percent. The Legislature agreed, and passed the tax reform law in 1935.^[14]

William Randolph Hearst, whose newspapers provided one of the bulwarks of the governor's 1934 campaign, complained bitterly over the reformed tax laws. The Hearst-owned San Francisco Examiner's editorial shortly after the reform bills' passage read: "[e]xtortionate and confiscatory taxation will mean ... devastation of business, paralysis of industry."^[10]

Fanning the growing rift between Merriam and conservative Republicans, right-wing author and playwright Charles Gilman Norris penned letters that became widely circulated thanks to Hearst's newspaper empire, complaining of Merriam's reforms. "[T]he minute the proposed State Income Tax becomes law, my wife, Kathleen Norris, and myself will put both our homes — the one in Palo Alto and our ranch near Saratoga — up for sale and move out of the State. There is no alternative for us. We pay 52% of our income now to the Federal Government at Washington and under the proposed State Income Tax Law, we shall have to pay an additional 18%, so that out of every dollar we earn from our writings, 70¢ will go out in taxes!"^[10]

Hearst supporters challenged Merriam's and the Legislature's 1935 reform laws during a special referendum in 1936 with Proposition 2. The proposition would automatically repeal the tax reforms, and would in the future require the support of two-thirds of the Legislature and approval of voters by statewide referendum before any new income tax could be imposed. The measure, however, was defeated.^[15]

While the State Senate was controlled by Republicans, the crucial lower house Assembly, where finance bills originated, was split between conservative and socialist-leaning Democrats. Merriam proceeded with appeasing the closely divided Legislature by praising the federal Townsend Plan, while complaining to conservatives and other capitalist supporters that he was surrounded by fanatics.^[10]

By the 1938 general elections, Merriam had lost much support from the right due to the 1935 tax reform laws and support for Social Security, while he garnered little support or sympathy from the left due to his troubled relationship with labor unions and the squelching of the Longshore Strike. For the elections, the Democratic Party nominated State Senator Culbert Olson, a former EPIC and Upton Sinclair supporter as well as an unabashed supporter of President Franklin D. Roosevelt's New Deal. Republicans, meanwhile, renominated Merriam for a second term of office.

Merriam lost to Senator Olson in an electoral landslide, ending the Republican dynasty over the governorship that had lasted for over forty years beginning with the election of Governor Henry Gage in 1898.