U.S. Steel Defeats the Amalgamated Association

United States 1901

Synopsis

After the Amalgamated Association of Iron, Steel, and Tin Workers (AAISTW, or the Amalgamated Association) strike was defeated in the aftermath of the Battle of Homestead (the gun battle between members of the Amalgamated Association and Pinkerton agents during the 1892 strike at the Carnegie Mill in Homestead, Pennsylvania), the union still held onto a precarious position in the iron and steel industry. This limited position was itself practically eliminated by the ill-conceived strike in 1901, when after a three-month strike the union was defeated by United States Steel and forced to withdraw from most of the mills owned by the steel trust.

Timeline

• 1881: U.S. President James A. Garfield is assassinated in a Washington, D.C., railway station by Charles J. Guiteau.
• 1886: Bombing at Haymarket Square, Chicago, kills seven policemen and injures numerous others. Eight anarchists are accused and tried; three are imprisoned, one commits suicide, and four are hanged.
• 1891: French troops open fire on workers during a 1 May demonstration at Fourmies, where employees of the Sans Pareille factory are striking for an eight-hour workday. Nine people are killed—two of them children—and 60 more are injured.
• 1894: Thousands of unemployed American workers—a group named "Coxey's Army" for their leader, Jacob S. Coxey—march on Washington, D.C. A number of such marches on the capital occurred during this period of economic challenges, but Coxey's march was the only one to actually reach its destination.
• 1897: In the midst of a nationwide depression, Mrs. Bradley Martin, daughter of Carnegie Steel magnate Henry Phipps, throws a lavish party at New York's recently opened Waldorf-Astoria Hotel, where she has a suite decorated to look like Versailles. Her 900 guests, dressed in Louis XV period costumes, consume 60 cases of champagne.
• 1899: Polish-born German socialist Rosa Luxemburg rejects the argument that working conditions in Europe have improved and that change must come by reforming the existing system. Rather, she calls for an overthrow of the existing power structure by means of violent international revolution.
• 1901: U.S. President William McKinley is assassinated by Leon Czolgosz, an anarchist. Vice President Theodore Roosevelt becomes president.
• 1901: Austrian-American immunologist Karl Landsteiner discovers A, B, and O blood.
• 1901: Guglielmo Marconi makes the first successful transmission and reception of a radio signal.
• 1903: Russia's Social Democratic Party splits into two factions: the moderate Mensheviks and the hard-line Bolsheviks. Despite their names, which in Russian mean "minority" and "majority," respectively, Mensheviks actually outnumber Bolsheviks.
• 1907: At the Second Hague Peace Conference, 46 nations adopt 10 conventions governing the rules of war.
• 1911: Turkish-Italian War sees the first use of aircraft as an offensive weapon. Italian victory results in the annexation of Libya.

Event and Its Context

The Amalgamated Association was established in 1876 by the merger of three labor unions that had formed in the earlier history of the industry: the Sons of Vulcan, the Heaters' and Rollers' Union, and the Roll Hands' Union. The new union thrived in these early years of the iron industry; by 1891 the Amalgamated Association claimed over 24,000 members, making it one of the largest unions in the American Federation of Labor (AFL). The leadership of the Amalgamated Association concentrated on creating uniformity in the wage scales of members, which in turn helped mill owners to anticipate production costs. This did not prevent bitter disputes from breaking out between management and labor, but management tolerated the union for this reason. The membership of the Amalgamated Association was concentrated almost entirely west of the Allegheny Mountains; most of the iron mills in the Ohio Valley and in Illinois were organized, but none east of Pittsburgh were unionized.

Technological advances in the field began to undermine the position of the union, particularly the shift to the production of steel, as the union had accomplished little organization in that part of the industry. The union was also quick to accommodate mill owners when they claimed that technological advances led to increases in productivity; most famously, the Amalgamated Association accepted a reduction of wages for its members at the Homestead Works in 1889 because of the introduction of new machinery at the mill that reduced the workload for members (and also eliminated several hundred jobs)—before the famous strike there of 1892. After the Battle of Homestead, the Amalgamated Association lost most of its membership in the mills that produced raw steel as well as in the mills that turned out rods and wire products. The union managed to hold on in those factories that turned out finished steel products, particularly sheet steel, tin plate, and steel hoops. It was in these remaining mills that the Amalgamated Association came into conflict with the monolithic United States Steel.

The formation of U.S. Steel, the first billion-dollar corporation in the United States, came at the climax of a period of business consolidations in the steel industry. Companies in several branches of the industry had consolidated in the years before the formation of U.S. Steel and were able to dominate their markets. U.S. Steel, under the direction of financier J. P. Morgan, was then able to merge these steel companies under a holding company under Morgan's control. Each of these companies controlled their particular segment of the steel industry but operated under a variety of different conditions; in particular, some of the companies operated with union workers and some without unions. The preference of most of the managers of the subsidiaries of U.S. Steel was to run their businesses nonunion. In fact, much of the work within these divisions was being directed away from union plants and into nonunion plants, which meant that union members were losing jobs to nonunion members. The Amalgamated Association was aware of the antiunion preference of many of the divisions of U.S. Steel and was determined to prevent this "whip-sawing" effect upon the mills with which they had contracts. The leadership of the Amalgamated Association adopted the goal of winning union contracts in all of the mills of the subsidiaries. A sense of urgency informed these efforts, as the officers felt compelled to act before the size and coordination of divisions made U.S. Steel impregnable to unionization efforts. Management of the steel trust was moving in a parallel direction, hoping to stave off unionization efforts long enough to stockpile enough product to wait out a potential strike down the road several months.

The executive committee of U.S. Steel agreed to sign new contracts with the union, but only for those mills that the Amalgamated Association had already organized. This policy was then passed down to the various divisions. When the negotiations between the divisions and the Amalgamated Association opened, however, the implementation of the policy was less than perfect. The Amalgamated Association opened negotiations with two divisions of U.S. Steel, the American Sheet Steel Company and the American Tin Plate Company. American Tin Plate initially attempted to rid itself of the union in mills that the Amalgamated Association had already organized. In the midst of negotiations, however, the division shifted positions and offered to allow the Amalgamated Association to organize all of its mills if American Sheet Steel would do the same. American Sheet Steel, however, remained true to the prescribed bargaining strategy and refused to allow the Amalgamated Association to organize its unorganized mills.

The Amalgamated Association, reaching this impasse, called a strike of the workers they represented on 1 July 1901. The Amalgamated Association was initially able to exploit the divisiveness of the two subsidiaries against them and especially against U.S. Steel management. The American public had a long-standing mistrust of monopolies, and a company that controlled 40 percent of the nation's steel-making capacity was a large target for such mistrust. The Amalgamated Association hoped to pressure the subsidiaries by using the mistrust of the parent corporation. This was an effective strategy, particularly because the formation of the trust was fairly new and upper management (particularly Judge Elbert Gary) decided that U.S. Steel was particularly vulnerable to such an attack. The executive committee of U.S. Steel forced the antiunion sheet mill managers to offer contracts to the Amalgamated Association in all but five plants.

At this point, the leadership of the Amalgamated committed a serious blunder. Confident that the union would soon win contracts in all of the plants, the union rejected management's offer. The union based this confidence upon the fact that not only had sheet steel workers enthusiastically entered the strike, but also that they had been joined by hoop steel workers in many plants as well. The Amalgamated Association therefore sent out a call for all tin plate workers to join the strike on 15 July. In the meantime, the union leadership traveled to New York City to negotiate with J. P. Morgan. Amalgamated Association president T. J. Shaffer and secretary John Williams were the primary union negotiators with Morgan. They found Morgan congenial but unyielding. They returned to Pittsburgh with an offer for contracts with all mills that had already been unionized at the end of June 1901. The executive board of the Amalgamated Association rejected this deal. The entire board then traveled to New York with the counterproposal of union contracts for all mills on strike at the time. Morgan rejected this proposal and accused Shaffer and Williams of bad faith bargaining because they had not prevailed upon fellow board members to agree to the earlier offer.

At this juncture, the union decided to raise the stakes rather than accept less than their goal of company-wide unionization. The executive committee of the Amalgamated Association called on workers in basic steel (that is, turning ore into steel) to join the strike. Membership of the Amalgamated Association in basic steel was small, and few answered the call of a union that had largely ignored them since the failure of the Homestead strike. With the continuation of work in the basic steel plants, workers in the finishing mills witnessed their jobs being taken over by strikebreakers. This development was a severe blow to the morale of union members, who had long clung to the belief that the job skills they possessed made them indispensable to the company.

The union responded to this development by asking the executive committee of the AFL to call out associated unions in mining and railroading, which the executive committee of the AFL refused to do. President Schaffer accused AFL president Samuel Gompers of betraying the union, a charge that did nothing to further the union's strike effort. An agreement to end the strike was not reached until 14 September, and the terms were very unfavorable to the union. The only mills that the Amalgamated Association retained were those that had remained out on strike, so the Amalgamated Association was only able to retain a token presence in the industry. In less than 20 years, the largest union in the AFL had been reduced to a mere shadow presence.

Key Players

Gompers, Samuel (1850-1924): Gompers was the first president of the American Federation of Labor (AFL). Gompers was a proponent of "bread-and-butter" unionism—getting union members contracts that rewarded them financially, above all. Gompers was not a strong proponent of social unionism or of using strikes for any other purpose than gaining better wages.

Morgan, John Pierpont (1837-1913): Succeeded his father at the head of J. S. Morgan and Company and was the guiding force behind the formation of the U.S. Steel Company, the first company in the U.S. to have a billion dollars in assets. Morgan and his company controlled the financial status of the entire country. He loaned the U.S. government gold in 1895 and assumed a major role in the Panic of 1907. Although Morgan often came under withering public criticism, this had no effect upon his business dealings.

Shaffer, T. J. (1853-1892): President of the Amalgamated Association of Iron, Steel, and Tin Workers at the time of the 1901 strike against U.S. Steel. Shaffer badly miscalculated both the strength of his union and the resolve of U.S. Steel to resist unionization of its entire operation. The result of these miscalculations was the greatly diminished importance of the Amalgamated Association.

See also: American Federation of Labor; Homestead Lockout.

Bibliography

Books

Brody, David. Steelworkers in America: The Nonunion Era.Cambridge, MA: Harvard University Press, 1960.

Couvares, Francis. The Remaking of Pittsburgh: Class and Culture in an Industrializing City, 1877-1919. Albany: State University of New York Press, 1984.

Robinson, Jesse. The Amalgamated Association of Iron, Steel, and Tin Workers. Baltimore, MD: Johns Hopkins University Press, 1920.

Strouse, Jean. Morgan: American Financier. New York:Random House, 1999.

—Gregory M. Miller