1919 - Commerce

Commerce

The Treaty of Versailles obliges Germany to pay large reparations that include not only billions of dollars, francs, pounds, lire, etc., but also merchant ships and fishing ships plus large quantities of coal to be delivered in the next 10 years to France, Belgium, and Italy. Germany loses 72 percent of her iron ore reserves as Lorraine is given back to France under terms of the Versailles Treaty. The second largest iron producer in 1913, Germany will be seventh largest as the Germans concentrate mining and steelmaking in the Ruhr Basin.

English economist John Maynard Keynes, 36, foresees that high reparations imposed on Germany will upset the world economy. Leader of the British Treasury team at Versailles, Keynes resigns to write in opposition to the reparations plan.

Inflation begins in France, which has suffered enormous property damage as well as human destruction in the Great War. The buying power of the franc in terms of gold will decline by 78 percent in the next 8 years (see 1926; 1928).

The Great War has cost the United States nearly $22 billion from April 1, 1917, through April of this year, and Washington has loaned nearly $9 billion to the Allied powers. Americans have paid high taxes to fund the war effort and contributed $400 million in cash and materials to the Red Cross War Council.

The International Labor Organization (ILO) created under the League of Nations is based on Article 23a of the League's Convenant, providing that it "maintain fair and humane conditions of labor for men, women, and children." The ILO will move its headquarters from London to Geneva in July of next year, and the United States will accept membership in 1934.

Australia has a maritime strike from April to May; a dock worker is killed in a fracas with police, and Western Australia's state premier narrowly escapes serious injury.

Winnipeg has a general strike as workers protest low pay and shabby working conditions. Police call the work stoppage a "communist revolution" and come down hard on the strikers.

Argentina has a major strike. President Irigoyen uses violent measures to break it up.

Labor unrest rocks the United States. Four million workers walk off the job or are locked out.

Boston police strike September 9 in protest against pay scales that range from 25¢ per hour for 83-hour weeks down to 21¢ per hour for 98-hour weeks despite wartime inflation. Only 427 of the city's 1,544-man force remain on duty to protest the orgy of lawlessness that ensues. Gangs of men, often drunk, roam the streets robbing, looting, raping, and beating up other citizens, Gov. Calvin Coolidge goes to bed at 10 o'clock and does not learn about the rioting until next morning. He sends state militia into Boston September 12, the 1,117 strikers are dismissed, and AFL leader Samuel Gompers asks that they be reinstated. Coolidge wires Gompers September 14, "There is no right to strike against the public safety by anybody, anywhere, at any time."

Steelworkers at Gary, Indiana, strike September 22 to force United States Steel to recognize their union. Chairman Elbert H. Gary, now 72, has refused to negotiate with the union and vigorously favors an open shop. The walkout ends in 110 days without success, and one-third of the workers continue to labor 7 days per week, but the walkout forces Gary to support abolishment of the 7-day week and 12-hour day. Taunton, Mass.-born William Z. (Zebulon) Foster, 38, is the AFL leader in the steel strike; a former IWW organizer, he will soon emerge as the leading figure in the American Communist movement.

Iowa-born United Mine Workers Union leader John L. (Llewellyn) Lewis, 39, begins a strike of bituminous coal miners November 1, but Attorney General A. Mitchell Palmer perceives that public opinion has turned against organized labor and obtains an injunction under the 1917 Lever Act, whose wartime powers remain in effect. The strike ends November 9.

Legionnaires attack a Centralia, Washington, IWW hall November 11 and lynch organizer Wesley Everest.

A U.S. labor conference committee urges November 22 that the country adopt an 8-hour workday and a 48-hour week.

E. I. du Pont de Nemours has $49 million in wartime profits even after paying out dividends of $141 million to stockholders (see 1915). The company's explosives have fired 40 percent of all Allied shells in the war, it has met at least half the domestic U.S. requirements for dynamite and black blasting powder, it has been plowing profits into research and acquisitions of other chemical companies, and it enlarges its holdings in General Motors, whose stock it began acquiring in 1916 and which it will soon control (see transportation, 1908). Pierre S. du Pont retires as president of the DuPont Co. to become head of GM, and Irénée du Pont becomes head of the chemical company (see transportation [Sloan], 1929).

Great Lakes Carbon Corp. has its beginnings in the Chicago brokerage firm Great Lakes Coal & Coke Co. founded by Chicago-born entrepreneur George Skakel, 27, in partnership with Rushton Fordyce and Walter Gramm. Skakel began his career as a railroad clerk at $8 per week and went on to work for Standard Oil. His firm will expand into oil and heating fuel, incorporate as a privately-owned company in 1939 under the name Great Lakes Carbon, and evolve into a major processor of metals and the world's largest producer of carbon black, making Skakel one of the country's richest men.

Many U.S. life insurance companies file for bankruptcy to avoid paying claims on policies issued last year to people who subsequently died of influenza. The companies took advantage of the widespread flu panic to sell policies, not anticipating the extent of the epidemic, and claims have exceeded their resources.

The cost of living in New York City is 79 percent higher than it was in 1914, says the Bureau of Labor Statistics (see Consumer Price Index, 1913).

Junior Achievement is founded at Springfield, Massachusetts, where some small after-school business clubs join under the direction of local paper manufacturer Horace A. Moses, 57, paper manufacturer (and former Massachusetts governor) Murray Crane, 66, and AT&T chairman Theodore N. Vail, now 74, who says, "The future of our country depends on making every individual, young and old, fully realize the obligations and responsibilities belonging to citizenship . . . providing each is given a fair and proper education and training in the useful things in life." A cofounder of the Eastern States Exposition (New England's largest regional fair), Moses is a farmer's son who believes in a strict work ethic and has become concerned that no organization exists to prepare rural children for careers in industry and trade. Junior Achievement will grow with help from the Boy Scouts, Girl Scouts, Boys & Girls Clubs, YMCA, New England Rotarians, settlement houses, companies, and individuals into a worldwide group providing business education, practical experience, and marketable skills as more and more youths move to cities and need to know how to create products and services, set up in business, advertise, and sell.

The first fixing of the world gold price is held September 12 at the N. M. Rothschild & Sons London banking house (see Royal Mint Refinery, 1853). Fixings will continue twice each day into the 21st century.

Andrew Carnegie dies in his Berkshire Hills mansion at Lenox, Massachusetts, August 11 at age 83, having given away all but $11.8 million of his $475 million fortune in philanthropic contributions that inspired other U.S. millionaires to be philanthropic (see 1889); expatriate landowner William Waldorf Astor, 1st Viscount Astor, dies of heart disease at his Brighton home October 18 at age 71, having established residence abroad in 1892 (the United States, he said, was no place for a gentleman to live) and become a British subject in 1899. His 40-year-old son Waldorf inherits his title, becoming 2nd Viscount Astor (of Hever Castle); former Carnegie Steel boss Henry Clay Frick dies at New York December 2 at age 69, leaving $20 million to public, educational, and charitable institutions at Pittsburgh (see art, 1935). His erstwhile business partner Andrew Carnegie had invited him to come a mile up Fifth Avenue for a visit in which they might make their peace, but Frick allegedly replied, "We'll meet in hell, which is where we're both going to go."

A Wall Street boom in "war baby" stocks sends prices to new highs. Baldwin Locomotive is up 360 percent over 1917 levels, General Motors up 940 percent, Bethlehem Steel up 1,400 percent. The Dow Jones Industrial Average closes December 31 at 107.25, up from 82.20 at the end of 1918.