The Boeing Company faced a walk-out by its workers this morning, halting production of its airliners. This is the first strike in nearly 20 years. It is indicative of growing labor activism, from efforts to unionize auto factories in the Southeast to a push for unions in retail business. In that context, I thought it would be interesting to visit Pullman, a company town on the far south side of Chicago.
George Pullman founded Pullman Palace Car Company in 1862, after President Abraham Lincoln signed the Pacific Railway Act providing Federal subsidies and land for a transcontinental railroad. Given Lincoln’s Illinois heritage, the terminus for the railroad would be Chicago.
Pullman envisaged a company town, America’s first planned model industrial community. Construction began in 1880 on a “total environment superior to that available for the working class anywhere else. He hoped to attract the most skilled workers to build his luxury rail cars and attain greater productivity due to the superior health and spirit of the employees.” By 1884, there were 1,000 homes and a series of public buildings from an open-air market to stables. Each home had gas and water, complete sanitary facilities and both back and front yards.
The factory utilized the first assembly line in America, with the train cars moving on a platform into a sequence of bays, from woodworking to interior decorating. The work was tough, with compensation based on piece work and long hours (often 16 hours a day).
Meanwhile, Chicago became the center of labor strife. In the recession of 1877, workers’ salaries were reduced in meatpacking and tractor assembly lines. The industrialists would employ replacement workers when faced with strikes, then used Pinkerton agents to infiltrate and break up the protests. This contentious situation escalated in 1886, when workers striking for an eight-hour workday at the McCormick Harvesting Machine Company, confronted Chicago police who were attempting to disperse the crowd. A bomb was thrown by the protestors, killing four and wounding 50 policemen, then a gun battle ensued. Four of the workers were tried, convicted, and hanged.
As recession gripped the U.S. again in 1894, Pullman fired one third of his workers and reduced the wages of the remaining workers by a third. Pullman refused to reduce the rent or food costs of the workers; their families faced eviction and starvation. The workers then walked off the job and were supported by 250,000 colleagues in the American Railway Union across the entire rail system west of Chicago. The strike escalated, with workers setting fire to trains and locomotives, including a U.S. mail train.
Federal troops were sent to Chicago, but the strikers escalated the battle, burning hundreds of railcars in the yard. Finally, order was restored and rail traffic resumed. According to Harper’s Weekly: “The nation was fighting for its own existence.” As a price of Federal intervention, Pullman was forced to divest all the housing and public spaces. He died two years after the strike, succeeded by Robert Todd Lincoln, son of the President.
The Pullman factory was very much in use until the 1960s, when rail transport was superseded by air travel and the automobile. The City of Chicago is now trying to rebuild the area, which has been depopulated by half given the disappearance of Pullman train assembly and the closure of a nearby U.S. Steel mill, which at its peak employed 25,000 people. A Walmart store, an SC Johnson factory and an Amazon distribution center take up about 20 percent of the site. The homes of the Pullman management and workers are now occupied by families, a low-cost arts center is available to local painters and sculptors. As with a visit to the pyramids in Egypt, it is a place where time has stopped but the lessons for modern executives are clear and present.
Richard Edelman is CEO.
