Andrew Carnegie on Crisis Response

The Wikipedia article on the Homestead strike of 1892 records that the dispute was a lockout and strike at the Carnegie Steel Company works at Homestead, Pennsylvania, that began after the expiration on June 30, 1892, of the existing wage scale contract between the Amalgamated Association of Iron and Steel Workers and the firm, and that the conflict escalated after Henry Clay Frick, who had been installed as general manager, locked the workers out on June 29 rather than continue negotiations. The article frames the dispute as one of American labor history's signal confrontations, with the strike lasting from July 6 to November 20, 1892, and notes that the workers' demands centered on wages and the firm's right to set the tonnage scale for the new open-hearth machinery, in a context where the union represented the more highly skilled workers at the plant and not the larger and growing mass of less-skilled labor.

The Wikipedia article on Henry Clay Frick records that Frick directed the 1892 Homestead strike response as chairman of Carnegie Steel, that he ordered the Pinkerton agents to the works on July 6, 1892, that he survived the July 23, 1892 assassination attempt by anarchist Alexander Berkman, and that he continued to direct operations from his hospital bed. The article records that the partnership between Frick and Carnegie ruptured irreparably in the years after the strike, that Frick was forced out of the chairmanship in 1894 over a dispute about the valuation of Frick's coke assets within the consolidated Carnegie Steel Company, and that he later sued Carnegie for the value of his interest. The article notes that the Frick-Carnegie correspondence during the strike survives as the primary historical record of the strike's management and that the personal rupture between the two men was never reconciled, despite a famous deathbed exchange reported by Clara Kelley, in which Carnegie requested a meeting and Frick replied that he would see him in hell.

The Wikipedia article on the Homestead strike records that on July 6, 1892, Henry Clay Frick brought in three hundred armed Pinkerton agents aboard two barges towed up the Monongahela River to take possession of the works, that fighting broke out at dawn between the Pinkertons and the locked-out workers massed on the riverbank, and that by the afternoon seven workers and three Pinkerton agents had been killed with many more wounded. The article records that after a twelve-hour standoff the Pinkertons surrendered and were marched under worker guard through a hostile crowd to a public hall, that several Pinkertons were beaten along the route, and that the barges were burned. The article identifies the riverbank battle as the moment that turned a wage dispute into a national political crisis and made Carnegie's absence in Scotland the subject of sustained press criticism.

The Wikipedia article on the Carnegie Steel Company records that, as the mills expanded, the labor force grew rapidly especially in less-skilled workers, that the more skilled union members reacted with the unsuccessful 1892 Homestead Strike along with demands for reduced working hours and against pay cuts, and that after the unsuccessful strike the company continued to expand with profits growing year on year, reaching net profits of twenty-one million dollars in 1899. The article identifies Jones & Laughlin Steel as the most important competitor to Carnegie Steel and later to U. S. Steel, and notes that after the 1901 sale the subsidiary was renamed the Carnegie-Illinois Steel Company in 1936, incorporating the name of the former Illinois Steel Company that had also been folded into U. S. Steel. The labor and competitive context is the institutional backdrop to the sale.

The Wikipedia article on the Homestead strike records that on July 12, 1892, the Pennsylvania state militia, ordered out by Governor Robert E. Pattison, arrived at Homestead by barge and encamped on the works' grounds, that the militia's presence ended the workers' physical control of the plant and enabled the firm to bring in non-union replacement labor, and that the strike collapsed over the following months with the union broken at Homestead for decades thereafter. The article notes that twenty-nine strikers were indicted on charges including murder, that anarchist Alexander Berkman separately attempted to assassinate Frick on July 23, 1892, shooting and stabbing the manager in his office, and that Frick survived and continued to direct operations. The article treats the collapse as the institutional defeat of the skilled-steel union that defined labor relations in American steel for the next four decades.

The Wikipedia article on the Homestead strike records that Carnegie was at his Scottish estate, Skibo Castle, throughout the dispute and that his absence became a permanent feature of his public image, with critics charging that he had deliberately remained abroad to let Frick carry the strike through, and that Carnegie's own autobiography recorded that his partners had begged him not to return because of his extreme disposition to grant the demands of labor, however unreasonable. The article records that Frick's strict anti-union posture prevailed after the strike, that union membership in steel collapsed nationally, and that the strike's outcome shaped the National Labor Relations debates of the 1930s as a cautionary example. The article treats the strike as the central contradiction of Carnegie's self-presentation as a friend of labor, since the operating philosophy of partnership with the men was punctured by the events at Homestead in a way his own text never fully resolved.

Carnegie's account of the Homestead Strike begins with the date July 1, 1892, during his absence in the Highlands of Scotland, calling it the one really serious quarrel with his workmen in the firm's whole history. He framed the prior twenty-six years of labor relations as the pride of his life and quoted a 1904 letter from his chief partner Henry Phipps affirming that Carnegie was always disposed to yield to the demands of the men, however unreasonable, which was precisely why one or two of his partners did not wish him to return during the strike. The Bessemer open-hearth and basic inventions had made old machinery obsolete, and the firm had spent several million dollars at Homestead reconstructing and enlarging the works, with the new machinery making roughly sixty percent more steel than the old, while two hundred and eighteen tonnage men were still on a three-year contract and had already captured much of that gain.

On the substance of the Homestead dispute, Carnegie wrote that the firm offered to divide the sixty percent production gain with the tonnage men, leaving the workers' earnings about thirty percent above the old scale while returning thirty percent to the firm to recompense its capital outlay, since the improved machinery did most of the additional work. He judged the offer not only fair and liberal but generous, and under ordinary circumstances it would have been accepted with thanks. The complication, as he framed it, was that the firm was then making armor plate for the United States Government, which Carnegie had twice declined to manufacture but which was urgently needed, and also held the contract for material for the Chicago World's Fair Exhibition, which gave the workers' leaders leverage they would not otherwise have possessed. Carnegie treated that strategic vulnerability as the reason a generous offer was rejected.

Carnegie's Problems of Labor chapter narrates a separate dispute at the steel-rail works, where blast-furnace men sent a round-robin demanding higher wages by Monday at four o'clock despite an agreement that ran to year's end. Carnegie took the night train from New York and summoned the three committees that governed the works — blast-furnace, mill, and converting — meeting them with hats off in what looked like a model assembly. When he asked the mill committee chairman, Mr. Mackay, whether they had an agreement, Mackay removed his spectacles and answered that Carnegie did not have enough money to make them break it. The rail converters' chairman, Mr. Johnson, answered that he signed only what suited him and kept what he signed. Carnegie treated both replies as the voice of the self-respecting American workman, while Captain Jones, his impulsive superintendent, supplied the contrast that disciplined cross-examination is the only honest way to settle labor disputes.