PROBLEMS OF LABOR
I should like to record here some of the labor disputes I have had to
deal with, as these may point a moral to both capital and labor.
The workers at the blast furnaces in our steel-rail works once sent in
a "round-robin" stating that unless the firm gave them an advance of
wages by Monday afternoon at four o'clock they would leave the
furnaces. Now, the scale upon which these men had agreed to work did
not lapse until the end of the year, several months off. I felt if men
would break an agreement there was no use in making a second agreement
with them, but nevertheless I took the night train from New York and
was at the works early in the morning.
I asked the superintendent to call together the three committees which
governed the works--not only the blast-furnace committee that was
alone involved, but the mill and the converting works committees as
well. They appeared and, of course, were received by me with great
courtesy, not because it was good policy to be courteous, but because
I have always enjoyed meeting our men. I am bound to say that the more
I know of working-men the higher I rate their virtues. But it is with
them as Barrie says with women: "Dootless the Lord made a' things
weel, but he left some michty queer kinks in women." They have their
prejudices and "red rags," which have to be respected, for the main
root of trouble is ignorance, not hostility. The committee sat in a
semicircle before me, all with their hats off, of course, as mine
was also; and really there was the appearance of a model assembly.
Addressing the chairman of the mill committee, I said:
"Mr. Mackay" (he was an old gentleman and wore spectacles), "have we
an agreement with you covering the remainder of the year?"
Taking the spectacles off slowly, and holding them in his hand, he
said:
"Yes, sir, you have, Mr. Carnegie, and you haven't got enough money to
make us break it either."
"There spoke the true American workman," I said. "I am proud of you."
"Mr. Johnson" (who was chairman of the rail converters' committee),
"have we a similar agreement with you?"
Mr. Johnson was a small, spare man; he spoke very deliberately:
"Mr. Carnegie, when an agreement is presented to me to sign, I read it
carefully, and if it don't suit me, I don't sign it, and if it does
suit me, I do sign it, and when I sign it I keep it."
"There again speaks the self-respecting American workman," I said.
Turning now to the chairman of the blast-furnaces committee, an
Irishman named Kelly, I addressed the same question to him:
"Mr. Kelly, have we an agreement with you covering the remainder of
this year?"
Mr. Kelly answered that he couldn't say exactly. There was a paper
sent round and he signed it, but didn't read it over carefully, and
didn't understand just what was in it. At this moment our
superintendent, Captain Jones, excellent manager, but impulsive,
exclaimed abruptly:
"Now, Mr. Kelly, you know I read that over twice and discussed it with
you!"
"Order, order, Captain! Mr. Kelly is entitled to give his explanation.
I sign many a paper that I do not read--documents our lawyers and
partners present to me to sign. Mr. Kelly states that he signed this
document under such circumstances and his statement must be received.
But, Mr. Kelly, I have always found that the best way is to carry out
the provisions of the agreement one signs carelessly and resolve to be
more careful next time. Would it not be better for you to continue
four months longer under this agreement, and then, when you sign the
next one, see that you understand it?"
There was no answer to this, and I arose and said:
"Gentlemen of the Blast-Furnace Committee, you have threatened our
firm that you will break your agreement and that you will leave these
blast furnaces (which means disaster) unless you get a favorable
answer to your threat by four o'clock to-day. It is not yet three, but
your answer is ready. You may leave the blast furnaces. The grass will
grow around them before we yield to your threat. The worst day that
labor has ever seen in this world is that day in which it dishonors
itself by breaking its agreement. You have your answer."
The committee filed out slowly and there was silence among the
partners. A stranger who was coming in on business met the committee
in the passage and he reported:
"As I came in, a man wearing spectacles pushed up alongside of an
Irishman he called Kelly, and he said: 'You fellows might just as well
understand it now as later. There's to be no d----d monkeying round
these works.'"
That meant business. Later we heard from one of our clerks what took
place at the furnaces. Kelly and his committee marched down to them.
Of course, the men were waiting and watching for the committee and a
crowd had gathered. When the furnaces were reached, Kelly called out
to them:
"Get to work, you spalpeens, what are you doing here? Begorra, the
little boss just hit from the shoulder. He won't fight, but he says he
has sat down, and begorra, we all know he'll be a skeleton afore he
rises. Get to work, ye spalpeens."
The Irish and Scotch-Irish are queer, but the easiest and best fellows
to get on with, if you only know how. That man Kelly was my stanch
friend and admirer ever afterward, and he was before that one of our
most violent men. My experience is that you can always rely upon the
great body of working-men to do what is right, provided they have not
taken up a position and promised their leaders to stand by them. But
their loyalty to their leaders even when mistaken, is something to
make us proud of them. Anything can be done with men who have this
feeling of loyalty within them. They only need to be treated fairly.
The way a strike was once broken at our steel-rail mills is
interesting. Here again, I am sorry to say, one hundred and
thirty-four men in one department had bound themselves under secret
oath to demand increased wages at the end of the year, several months
away. The new year proved very unfavorable for business, and other
iron and steel manufacturers throughout the country had effected
reductions in wages. Nevertheless, these men, having secretly sworn
months previously that they would not work unless they got increased
wages, thought themselves bound to insist upon their demands. We could
not advance wages when our competitors were reducing them, and the
works were stopped in consequence. Every department of the works was
brought to a stand by these strikers. The blast furnaces were
abandoned a day or two before the time agreed upon, and we were
greatly troubled in consequence.
I went to Pittsburgh and was surprised to find the furnaces had been
banked, contrary to agreement. I was to meet the men in the morning
upon arrival at Pittsburgh, but a message was sent to me from the
works stating that the men had "left the furnaces and would meet me
to-morrow." Here was a nice reception! My reply was:
"No they won't. Tell them I shall not be here to-morrow. Anybody can
stop work; the trick is to start it again. Some fine day these men
will want the works started and will be looking around for somebody
who can start them, and I will tell them then just what I do now: that
the works will never start except upon a sliding scale based upon the
prices we get for our products. That scale will last three years and
it will not be submitted by the men. They have submitted many scales
to us. It is our turn now, and we are going to submit a scale to them.
"Now," I said to my partners, "I am going back to New York in the
afternoon. Nothing more is to be done."
A short time after my message was received by the men they asked if
they could come in and see me that afternoon before I left.
I answered: "Certainly!"
They came in and I said to them:
"Gentlemen, your chairman here, Mr. Bennett, assured you that I would
make my appearance and settle with you in some way or other, as I
always have settled. That is true. And he told you that I would not
fight, which is also true. He is a true prophet. But he told you
something else in which he was slightly mistaken. He said I _could_
not fight. Gentlemen," looking Mr. Bennett straight in the eye and
closing and raising my fist, "he forgot that I was Scotch. But I will
tell you something; I will never fight you. I know better than to
fight labor. I will not fight, but I can beat any committee that was
ever made at sitting down, and I have sat down. These works will never
start until the men vote by a two-thirds majority to start them, and
then, as I told you this morning, they will start on our sliding
scale. I have nothing more to say."
They retired. It was about two weeks afterwards that one of the house
servants came to my library in New York with a card, and I found upon
it the names of two of our workmen, and also the name of a reverend
gentleman. The men said they were from the works at Pittsburgh and
would like to see me.
"Ask if either of these gentlemen belongs to the blast-furnace workers
who banked the furnaces contrary to agreement."
The man returned and said "No." I replied: "In that case go down and
tell them that I shall be pleased to have them come up."
Of course they were received with genuine warmth and cordiality and we
sat and talked about New York, for some time, this being their first
visit.
"Mr. Carnegie, we really came to talk about the trouble at the works,"
the minister said at last.
"Oh, indeed!" I answered. "Have the men voted?"
"No," he said.
My rejoinder was:
"You will have to excuse me from entering upon that subject; I said I
never would discuss it until they voted by a two-thirds majority to
start the mills. Gentlemen, you have never seen New York. Let me take
you out and show you Fifth Avenue and the Park, and we shall come back
here to lunch at half-past one."
This we did, talking about everything except the one thing that they
wished to talk about. We had a good time, and I know they enjoyed
their lunch. There is one great difference between the American
working-man and the foreigner. The American is a man; he sits down at
lunch with people as if he were (as he generally is) a gentleman born.
It is splendid.
They returned to Pittsburgh, not another word having been said about
the works. But the men soon voted (there were very few votes against
starting) and I went again to Pittsburgh. I laid before the committee
the scale under which they were to work. It was a sliding scale based
on the price of the product. Such a scale really makes capital and
labor partners, sharing prosperous and disastrous times together. Of
course it has a minimum, so that the men are always sure of living
wages. As the men had seen these scales, it was unnecessary to go over
them. The chairman said:
"Mr. Carnegie, we will agree to everything. And now," he said
hesitatingly, "we have one favor to ask of you, and we hope you will
not refuse it."
"Well, gentlemen, if it be reasonable I shall surely grant it."
"Well, it is this: That you permit the officers of the union to sign
these papers for the men."
"Why, certainly, gentlemen! With the greatest pleasure! And then I
have a small favor to ask of you, which I hope you will not refuse, as
I have granted yours. Just to please me, after the officers have
signed, let every workman sign also for himself. You see, Mr.
Bennett, this scale lasts for three years, and some man, or body of
men, might dispute whether your president of the union had authority
to bind them for so long, but if we have his signature also, there
cannot be any misunderstanding."
There was a pause; then one man at his side whispered to Mr. Bennett
(but I heard him perfectly):
"By golly, the jig's up!"
So it was, but it was not by direct attack, but by a flank movement.
Had I not allowed the union officers to sign, they would have had a
grievance and an excuse for war. As it was, having allowed them to do
so, how could they refuse so simple a request as mine, that each free
and independent American citizen should also sign for himself. My
recollection is that as a matter of fact the officers of the union
never signed, but they may have done so. Why should they, if every
man's signature was required? Besides this, the workmen, knowing that
the union could do nothing for them when the scale was adopted,
neglected to pay dues and the union was deserted. We never heard of it
again. [That was in 1889, now twenty-seven years ago. The scale has
never been changed. The men would not change it if they could; it
works for their benefit, as I told them it would.]
Of all my services rendered to labor the introduction of the sliding
scale is chief. It is the solution of the capital and labor problem,
because it really makes them partners--alike in prosperity and
adversity. There was a yearly scale in operation in the Pittsburgh
district in the early years, but it is not a good plan because men and
employers at once begin preparing for a struggle which is almost
certain to come. It is far better for both employers and employed to
set no date for an agreed-upon scale to end. It should be subject to
six months' or a year's notice on either side, and in that way might
and probably would run on for years.
To show upon what trifles a contest between capital and labor may
turn, let me tell of two instances which were amicably settled by mere
incidents of seemingly little consequence. Once when I went out to
meet a men's committee, which had in our opinion made unfair demands,
I was informed that they were influenced by a man who secretly owned a
drinking saloon, although working in the mills. He was a great bully.
The sober, quiet workmen were afraid of him, and the drinking men were
his debtors. He was the real instigator of the movement.
We met in the usual friendly fashion. I was glad to see the men, many
of whom I had long known and could call by name. When we sat down at
the table the leader's seat was at one end and mine at the other. We
therefore faced each other. After I had laid our proposition before
the meeting, I saw the leader pick up his hat from the floor and
slowly put it on his head, intimating that he was about to depart.
Here was my chance.
"Sir, you are in the presence of gentlemen! Please be so good as to
take your hat off or leave the room!"
My eyes were kept full upon him. There was a silence that could be
felt. The great bully hesitated, but I knew whatever he did, he was
beaten. If he left it was because he had treated the meeting
discourteously by keeping his hat on, he was no gentleman; if he
remained and took off his hat, he had been crushed by the rebuke. I
didn't care which course he took. He had only two and either of them
was fatal. He had delivered himself into my hands. He very slowly took
off the hat and put it on the floor. Not a word did he speak
thereafter in that conference. I was told afterward that he had to
leave the place. The men rejoiced in the episode and a settlement was
harmoniously effected.
When the three years' scale was proposed to the men, a committee of
sixteen was chosen by them to confer with us. Little progress was made
at first, and I announced my engagements compelled me to return the
next day to New York. Inquiry was made as to whether we would meet a
committee of thirty-two, as the men wished others added to the
committee--a sure sign of division in their ranks. Of course we
agreed. The committee came from the works to meet me at the office in
Pittsburgh. The proceedings were opened by one of our best men, Billy
Edwards (I remember him well; he rose to high position afterwards),
who thought that the total offered was fair, but that the scale was
not equable. Some departments were all right, others were not fairly
dealt with. Most of the men were naturally of this opinion, but when
they came to indicate the underpaid, there was a difference, as was to
be expected. No two men in the different departments could agree.
Billy began:
"Mr. Carnegie, we agree that the total sum per ton to be paid is fair,
but we think it is not properly distributed among us. Now, Mr.
Carnegie, you take my job--"
"Order, order!" I cried. "None of that, Billy. Mr. Carnegie 'takes no
man's job.' Taking another's job is an unpardonable offense among
high-classed workmen."
There was loud laughter, followed by applause, and then more laughter.
I laughed with them. We had scored on Billy. Of course the dispute was
soon settled. It is not solely, often it is not chiefly, a matter of
dollars with workmen. Appreciation, kind treatment, a fair
deal--these are often the potent forces with the American workmen.
Employers can do so many desirable things for their men at little
cost. At one meeting when I asked what we could do for them, I
remember this same Billy Edwards rose and said that most of the men
had to run in debt to the storekeepers because they were paid monthly.
Well I remember his words:
"I have a good woman for wife who manages well. We go into Pittsburgh
every fourth Saturday afternoon and buy our supplies wholesale for the
next month and save one third. Not many of your men can do this.
Shopkeepers here charge so much. And another thing, they charge very
high for coal. If you paid your men every two weeks, instead of
monthly, it would be as good for the careful men as a raise in wages
of ten per cent or more."
"Mr. Edwards, that shall be done," I replied.
It involved increased labor and a few more clerks, but that was a
small matter. The remark about high prices charged set me to thinking
why the men could not open a coöperative store. This was also
arranged--the firm agreeing to pay the rent of the building, but
insisting that the men themselves take the stock and manage it. Out of
that came the Braddock's Coöperative Society, a valuable institution
for many reasons, not the least of them that it taught the men that
business had its difficulties.
The coal trouble was cured effectively by our agreeing that the
company sell all its men coal at the net cost price to us (about half
of what had been charged by coal dealers, so I was told) and arranging
to deliver it at the men's houses--the buyer paying only actual cost
of cartage.
There was another matter. We found that the men's savings caused them
anxiety, for little faith have the prudent, saving men in banks and,
unfortunately, our Government at that time did not follow the British
in having post-office deposit banks. We offered to take the actual
savings of each workman, up to two thousand dollars, and pay six per
cent interest upon them, to encourage thrift. Their money was kept
separate from the business, in a trust fund, and lent to such as
wished to build homes for themselves. I consider this one of the best
things that can be done for the saving workman.
It was such concessions as these that proved the most profitable
investments ever made by the company, even from an economical
standpoint. It pays to go beyond the letter of the bond with your men.
Two of my partners, as Mr. Phipps has put it, "knew my extreme
disposition to always grant the demands of labor, however
unreasonable," but looking back upon my failing in this respect, I
wish it had been greater--much greater. No expenditure returned such
dividends as the friendship of our workmen.
We soon had a body of workmen, I truly believe, wholly unequaled--the
best workmen and the best men ever drawn together. Quarrels and
strikes became things of the past. Had the Homestead men been our own
old men, instead of men we had to pick up, it is scarcely possible
that the trouble there in 1892 could have arisen. The scale at the
steel-rail mills, introduced in 1889, has been running up to the
present time (1914), and I think there never has been a labor
grievance at the works since. The men, as I have already stated,
dissolved their old union because there was no use paying dues to a
union when the men themselves had a three years' contract. Although
their labor union is dissolved another and a better one has taken its
place--a cordial union between the employers and their men, the best
union of all for both parties.
It is for the interest of the employer that his men shall make good
earnings and have steady work. The sliding scale enables the company
to meet the market; and sometimes to take orders and keep the works
running, which is the main thing for the working-men. High wages are
well enough, but they are not to be compared with steady employment.
The Edgar Thomson Mills are, in my opinion, the ideal works in respect
to the relations of capital and labor. I am told the men in our day,
and even to this day (1914) prefer two to three turns, but three turns
are sure to come. Labor's hours are to be shortened as we progress.
Eight hours will be the rule--eight for work, eight for sleep, and
eight for rest and recreation.
There have been many incidents in my business life proving that labor
troubles are not solely founded upon wages. I believe the best
preventive of quarrels to be recognition of, and sincere interest in,
the men, satisfying them that you really care for them and that you
rejoice in their success. This I can sincerely say--that I always
enjoyed my conferences with our workmen, which were not always in
regard to wages, and that the better I knew the men the more I liked
them. They have usually two virtues to the employer's one, and they
are certainly more generous to each other.
Labor is usually helpless against capital. The employer, perhaps,
decides to shut up the shops; he ceases to make profits for a short
time. There is no change in his habits, food, clothing, pleasures--no
agonizing fear of want. Contrast this with his workman whose lessening
means of subsistence torment him. He has few comforts, scarcely the
necessities for his wife and children in health, and for the sick
little ones no proper treatment. It is not capital we need to guard,
but helpless labor. If I returned to business to-morrow, fear of labor
troubles would not enter my mind, but tenderness for poor and
sometimes misguided though well-meaning laborers would fill my heart
and soften it; and thereby soften theirs.
Upon my return to Pittsburgh in 1892, after the Homestead trouble, I
went to the works and met many of the old men who had not been
concerned in the riot. They expressed the opinion that if I had been
at home the strike would never have happened. I told them that the
company had offered generous terms and beyond its offer I should not
have gone; that before their cable reached me in Scotland, the
Governor of the State had appeared on the scene with troops and wished
the law vindicated; that the question had then passed out of my
partners' hands. I added:
"You were badly advised. My partners' offer should have been accepted.
It was very generous. I don't know that I would have offered so much."
To this one of the rollers said to me:
"Oh, Mr. Carnegie, it wasn't a question of dollars. The boys would
have let you kick 'em, but they wouldn't let that other man stroke
their hair."
So much does sentiment count for in the practical affairs of life,
even with the laboring classes. This is not generally believed by
those who do not know them, but I am certain that disputes about wages
do not account for one half the disagreements between capital and
labor. There is lack of due appreciation and of kind treatment of
employees upon the part of the employers.
Suits had been entered against many of the strikers, but upon my
return these were promptly dismissed. All the old men who remained,
and had not been guilty of violence, were taken back. I had cabled
from Scotland urging that Mr. Schwab be sent back to Homestead. He had
been only recently promoted to the Edgar Thomson Works. He went back,
and "Charlie," as he was affectionately called, soon restored order,
peace, and harmony. Had he remained at the Homestead Works, in all
probability no serious trouble would have arisen. "Charlie" liked his
workmen and they liked him; but there still remained at Homestead an
unsatisfactory element in the men who had previously been discarded
from our various works for good reasons and had found employment at
the new works before we purchased them.