Acclaim for Making Steel

the origins of de-industrialization

Review of Making Steel: Sparrows Point by Gregory Wood in Labor History, Vol. 46, No. 4, November 2005.

De-industrialization is a significant theme in the historiography of 20th century labor, though only a handful of journalists and academic historians have expressly written on the subject.

As industries such as auto and steel manufacturing declined during the 1970s and 1980s, and organized labor could not stop the erosion of industrial employment or promote social and economic justice for working people, labor historians sought answer in the past. Scholars such as Nelson Lichtenstein and Elizabeth Faue examined how the institutionalization of the Committee of Industrial Organizations (CIO) during the mid-20th century undermined the political assertiveness and democratic vitality that once characterized the labor movement of the 1930s. After the 1940s, bureaucrats, not activists, led organized labor. As a result, the CIO could not effectively combat the managerial policies that ultimately undermined basic industry. Focusing on the post-1945 period, several journalists and academic historians – Thomas Sugrue, John Hinshaw, William Serrin, and John Hoerr, for example – examined unions’ and managers’ roles in the decline of the steel and auto industries, as well as the human costs.

Originally published in 1988, former Baltimore Sun reporter Mark Reutter’s Making Steel nicely complements analyses of de-industrialization. Using newspapers, trade journals, periodicals, government reports, company records, and oral histories, this book outlines the history of Bethlehem Steel and the Sparrows Point mill complex in Baltimore throughout the 20th century. While other scholars have considered both management’s and labor’s relationship to the decline of steel, Reutter specifically takes aim against management. Taking a long view of management that extends back to the early 20th century, Reutter argues that company president Charles Schwab and his successors fostered a conservative corporate ethos that could not respond to changing market demands, international competition, and technological innovation…

Schwab established three significant managerial practices that would later weaken the company. First, loyalty, not talent, guaranteed promotion. Second, Schwab never looked outside of the firm for new talent or ideas. Third, he fostered a culture of excess among management. Schwab constructed the opulent Immergrun compound in Loretto, Pennsylvania, during the 1920s. Managers’ actions during the Great Depression underscored their arrogance. They disregarded workers’ struggles with low wages and difficult working conditions, and they were hostile to government intervention in their business through the New Deal. Also, Bethlehem allocated only a fraction of profits to research and development, and the firm devoted itself solely to steel and tin manufacturing. By the late 1930s, as Reutter suggests, the foundations had been established for the company’s later demise.

Demand for steel during the war and the postwar construction boom furthered Bethlehem’s expansion. By 1956, Sparrows Point was the largest steel mill in the world. Steelmaking was changing, however. Japanese and European firms made steel at lower prices, and new products such as aluminum and plastics encroached on the steel market. The world had changed, yet Bethlehem remained the same. During the 1960s, managers supported anti-import campaigns to “freeze their hegemony” in the market. In 1982, after several years of decline, demand plummeted. Massive layoffs followed. Bethlehem Steel finally succumbed to bankruptcy as 2001, as Reutter explains in a new concluding chapter.

In addition to discussing management, Reutter highlights steelworker’s experiences throughout the book. His use of oral histories is a major strength of the book. He includes vivid discussions of the dangers of steel labor, as well as an excellent chapter on women workers in the tin mill. While Reutter successfully highlights workers’ experiences, he does not address the relationship between organized labor and the industry’s decline. Reutter briefly characterizes the United Steelworkers of America (USWA) as an institution led by “self-protective” and “entrenched” leaders, but he does not examine union strategies to halt job loss and the decline of the industry. How did the USWA try to stop what was happening at Sparrows Point during the 1970s and 1980s?

Making Steel is a valuable addition to the de-industrialization literature. Reutter effectively shows how managerial practices precipitated Bethlehem Steel’s downfall.