The Company Town

by Hardy Green

  Small-town people are not known for ardent unionism, but such places as Austin, Albert Lea, Cedar Rapids, Ottumwa, and Waterloo proved fertile ground for militant labor activity. In Cedar Rapids, the independent Midwest Union of All Packing House Workers organized the Wilson plant, and Ottumwa’s Morrell workers were among the first members of the CIO’s United Packinghouse Workers in 1939. At profitable companies such as Hormel and Oscar Meyer—makers of such successful, value-added brands as Spam and Oscar Meyer wieners—union organization plus progressive company management resulted in high wages and a comfortable standard of living for small-town packers from the postwar years up to the mid-1980s. In fact, the average meatpacking wage in five midwestern states as of 1977 was nearly 30 percent higher than the average wages of all manufacturing workers.

  Although workers enjoyed some of the highest remuneration in the industry, progressive developments at Hormel went beyond pay increases. In addition to the guaranteed annual wage, management agreed to institute an unusual group-incentive arrangement. The workload for each gang in the plant was prearranged. Once they’d finished the stipulated amount of labor, the gang could either opt to go home—the “sunshine bonus,” they called it—or as a group they could decide to work more and receive a bonus for the extra production. With the speed of work self-determined, the once dictatorial foremen had less to do. “Formerly, you had to run your ass off to get them guys to work,” one foreman said. “Now you just stand and watch.” A worker added, “Some days, we do not see the foreman.” The profitable company also instituted profit-sharing and, to reduce conflict further with the union, agreed that it would mimic whatever wage rates the Big Four packers agreed to. For more than forty years, there was no serious dispute between the employees and the company.

  Hormel’s success continued into the 1940s, as such products as Dinty Moore Beef Stew and Hormel Chili Con Carne sold well domestically and as the federal government shipped millions of tons of such products as Spam and other canned meats to allies abroad. In 1941, Jay and George Hormel created the Hormel Foundation partly to keep company stock in friendly hands—the foundation received a controlling number of shares—but also to support local charities and ensure “the welfare of the community in which [the company] was located.” Prosperity continued after the war with company expansion into numerous other states, including California and Hawaii. In Austin, 75 percent of town residents owned their own homes, while it seemed that virtually all workers owned their own, relatively new cars.26

  But by the 1980s, this state of affairs had come to an end: By one historian’s calculation, meatpackers’ pay, weighted for inflation, proceeded in that decade to fall by almost half. Recession, plant closings, union defeats, and Reagan-era pay concessions conspired to bring the average hourly wage for packinghouse workers down to 20 percent below the national average for manufacturing workers. Another key factor: the entry of aggressive new companies into the field. A new Big Three—Iowa Beef Processors or IBP (today part of Tyson Inc.), ConAgra, and Cargill’s Excel—brought startlingly new technical innovations and marketing strategies, along with fiercely antiunion practices and very low wages. One key and highly disruptive innovation: the consolidation of slaughterhouse, meat-cutting, and packaging operations into single plants. Rather than shipping whole carcasses to retailers, popular cuts such as loins, ribs, or rumps could now be boxed up and shipped directly, allowing supermarkets and restaurants to do without their own skilled butchers.

  Many older companies, including Wilson, Armour, and Rath, were driven from the business. The serene relations in Austin and elsewhere came to an end with a series of unsuccessful mid-1980s strikes prompted by once-enlightened companies’ attempts to turn back the clock. Hormel’s Austin plant is now run as a two-tier operation, with the least desirable work—the killing floor—subcontracted out to a low-wage employer.

  Today, the prototypical meatpacking company town is a dystopia—a seeming throwback and at the same time very much representative of modern-day America. In Holcomb, Kansas, a town of 2,000 residents two hundred miles west of Wichita, IBP in 1980 built the world’s largest beef-packing plant. The company entered pork processing two years later. These large-capacity operations ran very high-speed production lines: At a plant in Columbus Junction, Iowa, the company slaughtered 11,500 hogs a day. In Perry, Iowa, IBP took over an Oscar Meyer pork plant that had been handling 750 hogs per hour, and it upped production, slaughtering 900 hogs per hour. Where Oscar Meyer was union, IBP ran the Perry plant nonunion, and it cut wages from close to $10 per hour to $5.80.

  When IBP opened its Holcomb plant, the fact that there was an insufficient local labor pool did not strike management as an obstacle: IBP proceeded to recruit workers from elsewhere—Mexicans from the Texas border, Laotians from California, and blacks from Chicago. Holcomb’s population shot up by 6,000. Of course, there was insufficient housing for the newcomers, so many moved into crowded boardinghouses or trailer parks; IBP opened a trailer park specifically for its employees. Other plants depending largely on Hispanic migrants include ConAgra’s Garden City, Kansas, and Marshalltown, Iowa, facilities and the IBP plant in Storm Lake, Iowa, which employs many Laotians as well. The changes represented a culturally destabilizing explosion of ethnic diversity in an area where, for generations, the population had consisted almost entirely of whites of Scandinavian and German extraction.

  The unforgiving pace of work led to unprecedented worker turnover, with annual rates of as much as 96 percent at some plants. IBP regarded this level of turnover as a positive thing, one company executive testified before Congress, since it meant the company would neither have to pay for health insurance nor grant vacations to many workers since they never got past their probationary periods.

  Then there was the horrific injury rate. At companies such as Hormel, it was bad enough: Workers equipped with knives and electric equipment gouged themselves and their fellows on a regular basis, and repetitive-motion injuries such as carpal tunnel syndrome were at epidemic levels. In 1986 Hormel predicted that some 36 percent of the Austin workers would be disabled due to injury in the coming year. But at IBP the injury rate was even worse: In 1988 the federal Occupational Safety and Health Administration (OSHA) fined the company more than $3.1 million for its neglect of workers at the company’s Dakota City, Nebraska, plant. OSHA said IBP had made no attempt to solve its high injury rate due to repetitive job motions. In the intervening years, the injury rate has scarcely improved: The U.S. Bureau of Labor Statistics in 2005 reported an average of 12.6 injuries or illnesses per 100 full-time meatpacking workers, a number twice that of all manufacturing jobs.

  With the coming of packing facilities, towns have experienced a spike in social problems, including every sort of crime, drug addiction, and poverty. “We get people who arrive with only the clothes on their back,” one social worker in Columbus Junction, Iowa, told the Wall Street Journal . Crime in that town, where IBP moved in to take over a shuttered Rath plant in 1985, quadrupled, with as many as thirty big-city gangs appearing. Student turnover at the high school soared, to 25 percent. These ills are also spreading to towns where plants have been shuttered or where companies have cut pay and benefits, including Austin and Ottumwa.

  There has also been a geographic shift in meat production away from the Midwest, to the Deep South. The largest pork-slaughtering plant—owned by Smithfield Foods, which has become the largest pork processor in the United States—is now in Tar Heel, North Carolina.27 That state is experiencing the same problems that became commonplace across Iowa and the Midwest.

  In the summer of 2008, a kosher meatpacking plant in Postville, Iowa, became the subject of frenzied news coverage. A raid by state labor investigators revealed that Agriprocessors, the largest U.S. kosher meatpacking plant, was employing more than three hundred illegal aliens from Guatemala. It was the largest immigration bust ever. But more important, the state found that fifty-seven of these workers were underage. There were “egregious violatio
ns of virtually every aspect of Iowa’s child labor laws,” in the words of the state’s labor commissioner; a criminal indictment listed 9,000 such instances of lawbreaking. Workers told reporters that they were forced to work shifts of up to seventeen hours a day, received wages of between $6.25 and $7 per hour, and sometimes got no overtime pay. Two months later, federal authorities arrested the company’s former chief executive, Sholom Rubashkin, and charged him with harboring illegal immigrants and abetting identity theft. 28

  The affair stirred local resentment and a wave of anti-Semitism against the Hasidim from New York and Israel who had established a colony in Postville and operated the plant. Rubashkin, who in June of 2010 was found not guilty of the child-labor law violations, made no comment at the time of his arrest. Perhaps he should have said: “Hey, what’s the big deal? It’s the American way.” At least where meatpacking is concerned, he would have been correct.

  CHAPTER 7

  The Instant Cities of the Good War

  A small band played “The Star Spangled Banner.” A foreman made a speech. . . . At the minister’s loud “God bless this ship,” the young woman smashed the bottle with a will and, whistles blowing, the shining grey freighter began to slide. . . . Pushing out a white surging wave behind her dripping stern, she slid into the river.

  In our group, eyes were damp. Throats were being cleared. . . . [Said one young man:] “Every day in some yard a ship is being launched. As many as I’ve seen go down, it always gives me a thrill.”

  —JOHN DOS PASSOS describing a Portland, Oregon, shipyard in State of the Nation (1944)

  World War II operated on the population like a milkshake machine, dislodging men and women from their places of residence and scattering them across the continent, to serve both the military and defense industries. Between 1940 and 1947, 25 million people, or about one-fifth of the citizenry, decamped for new situations. “Probably never before in the history of the United States has there been internal population movement of such magnitude,” said a U.S. Census Bureau report.

  By spring 1945, more than 12 million were in the armed forces, which shuttled them from base to maneuvers to base before sending many off to foreign shores. On the home front, unemployment, as high as 14 percent in 1940, vanished, as 15 million additional people entered the workforce, mostly in war-related industry. Under War Production Board orders that limited all nonessential production, factories switched from manufacturing automobiles to tanks, from toilets to submarine torpedo tubes. Companies enlarged existing plants and built gigantic new ones. Near Detroit, Ford Motor Co. built the sprawling, sixty-seven-acre Willow Run plant that employed 42,000 men and women making bomber planes, such as the B-24. Enormous Douglas Aircraft plants in Long Beach and El Segundo, California, employed 100,000 people working in three shifts around the clock. The most unlikely places abruptly became centers of industry: Sleepy Pascagoula, Mississippi, formerly home to 6,000 people, quadrupled in size as workers flooded in to man its shipyards.1

  John Dos Passos, author of the celebrated U.S.A. trilogy of novels, went on the road during the 1940s to track the cultural upheaval. Among his stops: Detroit, Washington, Pittsburgh, San Francisco, Houston, Portland, and the Gulf Coast seaport of Mobile, Alabama. He found the last of these—home to an airfield, shipping operations, and shipbuilding facilities—to be a teeming boomtown, “trampled and battered like a city that’s been taken by storm.” On the edge of the town he discovered “acres and acres raw with new buildings,” long lines of new houses, and “miles of dormitories, great squares of temporary structures” hammered together by mobs of tobacco-chewing construction workers. “To be doing something toward winning the war, to be making some money, to learn a trade, men and women have been pouring into the city for more than a year now,” he reported. “For them, everything’s new and wonderful.”2

  New towns emerged as part of this cataclysm—and two of these were extraordinary. The San Francisco Bay Area became a center of shipbuilding operations, and even more instantaneously than Gary, Indiana, a city mushroomed around new shipyards at Richmond. The most far-reaching war venture, of course, was the Manhattan Project: Of its several operations—which also included Los Alamos, New Mexico, and Hanford, Washington—Oak Ridge, Tennessee, was arguably the United States’ most astounding and disruptive exercise of eminent domain. It, too, was an instant city, where 80,000 people migrated without any idea of exactly what work they would be doing.

  In the early 1940s, Richmond, California, was a pretty quiet place. Just north of Oakland on the eastern shore of San Francisco Bay, the town was “a drab little industrial city,” in the words of Fortune magazine, marshland backed by a few hills that were peppered with Standard Oil storage tanks. The fragrance from that company’s refinery was an almost palpable presence. Along with the Standard facility, Richmond contained perhaps a dozen other industrial operations, including since the early 1930s a Ford Motor assembly plant.

  Things were about to change—radically. Ford had been drawn to the area by its deepwater port, and local businessmen felt that other companies should be attracted as well. So in 1939, officials from the local chamber of commerce suggested to the U.S. Maritime Commission that the site was a natural for shipbuilding. War was already a reality in Europe, and where there is war, there is money to be made. Before long, the Maritime Commission and the Richmond officials were in contact with other parties, including a vigorous construction magnate named Henry J. Kaiser and his sometime colleague, W. A. Bechtel.

  Kaiser and Bechtel had been the major figures behind such profoundly transformative projects of the 1930s as the Boulder and Bonneville dams. They didn’t know much about shipbuilding—but such gaps in experience never stopped Kaiser. A baldheaded, 260-pound dynamo in a double-breasted suit, Kaiser would become nationally celebrated—and resented—as a can-do guy who seemed always to deliver on his ambitious, even outrageous, promises. And it didn’t take Kaiser long to become very interested in Richmond.

  In late 1940, a British commission arrived in New York looking to assign the building of sixty cargo ships. The Kaiser-Bechtel consortium, known as Six Companies, bid on the project and, against all odds, won it. Almost immediately, Kaiser dispatched a young executive from his company, Clay Bedford, who was working on a construction project in Texas, to Richmond to put together a shipyard. Solidifying the shoreline marshes with 300,000 cubic feet of rock, Bedford had a workable shipyard in place within six months.3

  That was only the beginning.

  Pearl Harbor made Kaiser’s shipyards into a major contractor for the U.S. government. The assignment: producing the freighters that would be known as Liberty Ships and Victory Ships. Kaiser and the War Manpower Commission proceeded to recruit workers from across the country and abroad—targeting such surplus-labor pools as Minneapolis, Little Rock, Memphis, and St. Louis. They tapped idle mining and agricultural areas in California and called out to urban workers in Los Angeles. The result: Richmond’s population jumped by 400 percent. By the end of 1943, the four Kaiser shipyards employed 100,000 workers.

  Richmond became a boomtown, with experiences not unlike those of the Texas oil-gusher communities. The promise of high wages, averaging $1 per hour, drew workers, but expenses, especially rent, ate up much of that. And as in Texas, they were extremely fortunate if they could find any place to stay: Early arrivals in Richmond snatched up the available spare rooms. More than seventy trailer camps sprouted on the outskirts of town, and soon they were jammed, too. Families slept in cars, pitched tents along outlying creeks, and rented shelter in boats harbored near the shipyards. In one case, twenty-eight people cohabited in a converted storefront. Others found lodging in chicken shacks that a federal housing agent called “so horrible that the only possible solution would be to remove their occupants immediately and burn the shacks.” In another oft-described case, a single male worker volunteered for the graveyard shift at the Richmond yard, slept in the park by day, then shaved at a gas-station washroom and spent th
e evening in a bar before going off to work.

  Schools operated in quadruple shifts, as juvenile delinquency soared. Other crimes, including prostitution, rose as well, and during one month police made 4,000 arrests. (The resulting fines ran to $34,000 and, no doubt, were welcomed by the fiscally strapped city government.) Although neither gambling houses nor brothels operated openly, plenty of both existed surreptitiously. Restaurants and movie houses ran full-out, round-the-clock. And as in Gary, a tough saloon district appeared, especially along the main drag known as McDonald Avenue. “It takes a fairly hardy customer to walk into the Nutt Club, the Denver Club, or the Red Robin,” reflected the Fortune writer.4

  Kaiser’s shipyard was like a city unto itself. Photos from the time show a vast industrial area dominated by towering cranes. In his collection of short stories, Swing Shift, Joseph Fabry describes a character’s arrival at the facility after passing beneath a huge REMEMBER PEARL HARBOR sign. “The yard was arranged city-like,” Fabry explains:F, G, H Streets running in one direction, 9th, 10th, 11th Streets in another. It was a city without houses, but the traffic was heavy. Cranes, trucks, trains nosed by. Finally, after a rather long walk, I came to the edge of the water. There were the ships—or rather, halves, thirds, quarters, and tenths of ships. There was a piece of a ship here and a piece of a ship there, and a hole in between. And then out of a clear sky a crane dropped the missing piece of a ship, big as a house, into that hole.

  In Swing Shift, workers from a variety of backgrounds are thrown together, eagerly learn new skills, rapidly overcome initial stereotypes about gender and race, find romance, and finally triumph in the speed-record-breaking completion of a Liberty ship. A Viennese refugee from Nazism, Fabry saw American life and comradeship in a rosy hue. William Martin Camp’s novel Skip to My Lou is much less Pollyannaish. Following a family of Arkansas migrants to Richmond, Camp offers images of brutish living conditions, furtive prostitution amid partially built ships, and racial friction that threatens to burst forth in street fighting. In one scene, the author describes the sweaty, miserable drudgery belowdecks:There they lay on their bellies and fitted the pipes and welded them, flanged, burned, bolted, riveted, working long, hot, hellish hours in those burning hulls where the slightest tap with a hammer on the steel hull reverberated and echoed and bounced back like the noise inside a big bass drum.5