Contract time: inflation's stake

THE US business community and organized labor have everything to win and nothing to lose by protecting the gains that have been made during recent years in fighting inflation.

In this regard, the 30 percent increases railroad industry workers announced they will seek over the next three years seem excessive. The issue is not one of denying railroad workers - or any worker - legitimate wage increases and benefit increases. Rather, the need is to avoid future increases that actually promote inflation by sharply pushing up the cost of goods and services.

Most economists now expect inflation to run between 5 and 7 percent this year.

Inflation works against real prosperity. Besides debasing the value of a nation's currency, it unfairly redistributes wealth, discourages capital investment, and works against exports. It is especially injurious to poor persons who spend all their income on food, clothing, and housing, and to older Americans on fixed incomes.

In the railroad industry alone, contract negotiations for some 300,000 workers are expected to begin in the next few weeks. Preliminary worker demands appear excessive. Negotiations involving 610,000 postal workers will begin later this year. The United States Postal Service is arguing that postal workers are overpaid compared with workers in the private sector - and is hinting that concessions will therefore be in order from the workers, a position that union leaders say is not negotiable. Could an impasse lead to actual strife?

Also coming up later this year: bargaining for more than 50,000 maritime workers and over 450,000 auto workers. Finally, coal-miner contracts come up for review at the end of the year.

Surely, management should not hold out against legitimate wage and benefit requests that are consistent with rising US productivity. What is increasingly worrisome is that a number of labor leaders are now talking about substantial benefit packages that could well be in excess of actual gains in productivity.

Labor leaders and management in the US would seem to be on best ground by working together to ensure that coming contractual negotiations are resolved in a way that is equitable not just to the workers and enterprises involved, but to the national well-being as well.