The America of 1919 should have been a peaceful place. The war to make the world safe for democracy was over with a huge victory. New York harbor was welcoming troop ships loaded with doughboys who marched jauntily through downtowns across the country. With peace, surely only a better nation and world would emerge. But the reality was far different. The war had ended abruptly with a taste of unfilled promise in many working people’s mouths. They had worked twelve hours a day at 40 cents a day. They felt, from Boston policemen to Bethlehem steel workers, that they deserved higher wages and better working conditions. Those who were unionized or wanted to be turned to their leadership. And when their employers refused to bargain, they used the only weapon they felt they had: they went out on strike.
This is a very simple explanation for the wave of labor unrest that swept the nation 100 years ago. But it is far from a complete one. Because of the war and revolution in Russia, a new fear associated with the workers movement was tied to Communists. And in the Lehigh Valley it manifested itself in the Steel Strike of 1919 at Bethlehem.
100 years ago Bethlehem Steel had solidified its position as the second largest steel maker in the world. Since the start of the war in Europe in 1914, its war production had made it the largest single supplier of weapons and munitions to the Allied cause. As a result, under the disciplined, hard-driving Steel president Gene “Always More Production” Grace, the company made record profits. But the workers felt that they had contributed and deserved to see at least some of those profits in their paychecks. And they, as represented by their leadership, also wanted something more: the right to organize and bargain collectively with management. But Grace, leader of the management team gathered by Charles Schwab nicknamed “the Boys of Bethlehem,” would not budge. “I will not be in the position of having labor dictate to management,” Schwab had said during the 1910 strike, which he had crushed with the state police. And now it would be Grace’s turn to take them on.
The 1919 strike was not started in Bethlehem. The Amalgamated Association of Iron Steel and Tin Workers, a crafts union among the skilled steel workers, went back to the early 1890s. But by the early 20th century it was a shell of its former self and the American Federation of Labor (AFL) began unionizing the unskilled workers. In this they were met with strong opposition from management and the failure of local unions and the AFL to agree on what exactly unions were. This was at least a part of what led to the collapse of the 1910 strike in Bethlehem.
Perhaps the best local source on the 1919 strike is labor historian Ron Ennis. In a recent series of articles for the Lehigh Valley Labor Council Newsletter, he has outlined the situation both across the country and particularly at Bethlehem Steel. As Ennis points out, what made things different at Bethlehem in 1919 as opposed to 1910 was the active intervention of the U.S. government in the wartime steel industry. Acting through the National War Labor Board, a federal regulatory body, the Bethlehem Steel workers had a counterweight to Grace’s management.
In April of 1918, Bethlehem Steel machinists walked off the job. Efforts by mediators to get the steel company president to keep the promises he had made with workers had proved futile. So they turned the issue over to the NWLB. Chaired by former Republican president William Howard Taft, who was no liberal but regarded as fair by labor and management, began hearings and started taking testimony from workers and management. Much to the surprise of Grace, on July 31st 1918, the NWLB sided almost totally with the workers. “The labor board,” Ennis writes, “insisted that he boost the steelworkers’ pay, dismantle the convoluted bonus scheme, pay time and one-half after eight hours of work, and begin collective bargaining.”
Grace for the first time felt boxed in. After all he had done for the war effort, he was being treated like he had no control, that the government could tell him what to do. Grace had put in place a plan of employee representation conceived for him by Willian Mackenzie King, a Canadian born politician who worked as a consultant to American industries. It became known as the ERP. This allowed the workers to register a grievance, but it was to be done without any union representation. As Grace had said in one of his confrontations with Taft when asked if he would meet with the workers, “yes, but not as union men.”
At first union leaders accepted the plan concept. It was only later when they discovered, as they saw it, that it was nothing but a company union, that they protested it. But it would not be until 1935 that the National Labor Relations Act would finally declare ERPs illegal. Even many years later Bethlehem Steel executives would defend the ERP concept. As one long retired Steel manager put it in the 1980s, it was, “the most-fair system that could be devised.” But, as Ennis points out, it was fate, not ERPs that would in enable Grace to “snatch victory from the jaws of defeat.”
In the fall of 1918, many people both military and non-military were convinced that American troops might have to fight their way to Berlin. But conditions inside a battered and hungry Germany led rapidly to the collapse of Kaiser Wilhelm II’s imperial government. He fled to exile in Holland. On November 11, 1918 an armistice was signed with a new government and the war was over. Grace recognized that without a war he had no reason to listen to a National War Labor Board. Bethlehem Steel immediately stopped making munitions and by March of 1919 had laid off sixty percent of its workforce. Now there was no need to pay workers for overtime.
Grace told the labor board that they now had to accept his ERP plan. Adding that the government now owed him, Grace said, $1.6 million before he distributed the wage increases the board said he owned the workers. “The war’s end presented Grace with the gift of rolling back all the gains the steel workers had won under the board award,” Ennis writes. Taft was flabbergasted by Grace’s actions. “The present attitude of Mr. Grace,” he said, “ colors the whole situation with a sense of injustice which makes one yearn for judicial power to compel compliance, but this board has not that power.”
Workers continued to hope that President Wilson would step in. But by 1919 he was tied up trying to get the Republican controlled Senate to accept the Versailles peace treaty and with it the League of Nations. That October a stroke would incapacitate Wilson for the rest of his term. Talk began to be heard about a possible strike at Bethlehem Steel. But it was to the west in far-off Pittsburgh steel mills where the loudest rumbles were coming from. Attempts by Samuel Gompers of the AFL to get together with Judge Elbert Gary (an attorney, he had served two terms as a DuPage County, Illinois judge in the 19th century) and the United States Steel Corporation chairman for an interview were met with silence. On September 22, 1919 thousands of steelworkers in Pittsburgh walked off the job. In several cases company police shot and killed striking workers.
David Williams, head of the International Association of Machinists union at Bethlehem, called a strike on September 29. Unfortunately for the steelworkers their labor action was taking place while the Red Army in Communist Russia was attempting to spread its influence deep into Europe. It had also apparently stirred up the sympathies of radicals and anarchists in America. They were a very small number of people, but a series of bombs that they sent through the mail to prominent people, among them Attorney General A. Mitchell Palmer, sparked what historians came to call the Red Scare of 1919. An outraged and panicked public wanted action. The outrage also gave steel mill owners a tool they could use against the striking unions. Soon the newspapers hyped the Red threat and the public came to link the unions with a potential Red revolution in America. Cartoon figures of bearded, bomb- throwing figures were everywhere in newspapers and magazines.
While there was no violence at Bethlehem Steel, the workers met a stonewall from the company. Grace felt with the war over and with the country caught up in an anti-union mood, he did not need to compromise. When Bethlehem mayor and Steel vice president Archibald Johnston issued an anti-riot proclamation that declared, in part, that three people standing on a street corner was a riot, there was no one who dared contradict him. The New York Times reported that the Christmas City’s streets were patrolled by “ex-Army men in full uniforms, service chevrons and all, swinging little riot clubs and wearing police buttons (badges).” Grace even issued an order that workers who lived in Allentown had to move to Bethlehem if they wanted to keep their jobs. For Williams and the machinists who made up a large number of the Allentown residents, the implication was clear.
Throughout October Williams tried to raise the workers’ morale by bringing in outside labor figures like Mary “Mother” Jones. But it was clear poker player Grace held all the best cards. By November 1919 the strike was limping along and finally died out. The Steel Strike of 1919 officially came to an end on January 8. 1920. Despite being attacked by the Easton Express as that “radical Socialist born in Wales,” Tamaqua native David Williams refused to let go of the government’s promise of reimburse his members. Throughout the 1920s, as Lucky Lindy flew to Paris and gangsters, gun molls and movie stars replaced Lenin and strikers on the front page of America’s newspapers, through two generally unsympathetic Republican administrations and cynical union members who thought he was wasting his time, Williams pushed on, using what influence he had in Congress. And then all the pieces finally fell in place.
It was in February of 1929 that outgoing President Calvin Coolidge (presidential inaugurations took place on March 4th at that time) signed the legislation giving the workers the pay increase they had been promised by the National War Labor Board 11 years before. The checks started coming that April. Eugene Grace, named by the business press in 1930 as the highest paid executive in America, is not known to have commented. Most people in the country had their eyes on an ever-rising stock market and believed it was about to make everybody rich, so they probably ignored it. By then 1919 must have already seemed like a long time ago. But the Great Depression was just around the corner.