The People's Tycoon: Henry Ford and the American Century (Vintage) (37 page)

In light of such public statements, Couzens' reputation as a progressive began to grow rapidly. Detroit newspapers described him as the “Wizard of Finance Who Combines Humanitarianism with Efficiency,” while he chastised Detroit's business elite. A few months after the announcement of the Five-Dollar Day, he spoke to the Detroit Board of Commerce and excoriated its members for greedy business behavior. “You fellows sit back, smug and complacent, and don't give a damn what becomes of your workmen,” he said. “They are just as human as you and I, but they are not as well taken care of.” Citizens responded; in time he was elected mayor of Detroit and then to the United States Senate. “I think I know how the average man feels on most questions,” he noted soon after his election. “I am going to try to be his spokesman on the floor of the Senate.”
³⁴

James Couzens played a central role in formulating and promoting the new wage policy. But his efforts on behalf of the Five-Dollar Day were only a preview of what the Ford Motor Company launched in the weeks and months that followed. Never one to overlook a publicity opportunity, Henry Ford masterminded one of the great promotional blitzes in the history of his company.

As news of the Five-Dollar Day reverberated throughout the United States, newspapers and magazines were filled with commentary, feature stories, editorials, pictorial spreads, and publicity releases on the phenomenon. This provided a kind of free advertising, just as Henry Ford had hoped.

Following distribution of the original printed statement on January 5, Henry Ford carefully encouraged an outpouring of national publicity when he arrived in New York City on January 8 for its annual auto show. Staying at the Belmont Hotel, he attracted so many reporters, photographers, and admirers that the management deployed a squad of security people to protect him. Ford clearly welcomed the limelight. He submitted to interviews, answered questions patiently, and projected an image of modest, simple honesty. He also showed a talent for creating memorable quotes. “I believe it is a disgrace for a man to die rich,” he declared. “Goodwill is about the only fact there is in life. With it a man can do and win almost anything. Without it he is practically powerless.” Throughout the spring of 1914, a string of interviews, carefully crafted statements, and public appearances by Ford maintained this promotional momentum.
³⁵

The offensive produced hundreds of favorable newspaper stories throughout the United States. Their headlines provided a glimpse of the
outlandish praise within. One proclaimed, “World's Economic History Has Nothing Equal to Ford Plan.” According to another, “Social Justice Animates Ford, He Is Not for Multi-Millionaires.” Other headlines followed similar themes: “Puts Capital and Labor on Equal Basis,” “Ford Factory Has a Heart,” “Henry Ford's Act Is That of a Far-Sighted Businessman.” The stories that followed typically framed the Five-Dollar Day as a reform healing the rift between capital and labor while praising its creator as a “man of the people.” A story entitled “Aid Man Who Sweats, Says Ford,” for instance, quoted him as declaring that the man “who literally lives by the sweat of his brow, is the man entitled most to direct rewards for his labor wherever those rewards are possible.”
³⁶

Most newspaper editorials were effusive about the Five-Dollar Day. Some praised it for diffusing wealth more widely in the new consumer-oriented United States, where an increased ability to buy goods and enjoy leisure meant higher status and enhanced happiness. Ford's wage plan brought “Prosperity Sharing,” said the Cleveland
Plain Dealer,
and “opens the way to further wealth diffusion,” said the New York
Globe.
The Omaha
News
stressed that “26,000 men and women are to have their leisure increased and their buying capacity multiplied.” Ford, these papers believed, had transformed thousands of ordinary workers into consumers and customers.
³⁷

Other editorialists stressed that Ford's wage policy attacked the most vexing social problem in the United States over the previous forty-five years: the clash between capital and labor. Since the 1870s, rapid industrialization had pitted factory workers against their employers in disputes over wages, hours, and working conditions. Unionization, labor strikes, and violence had punctuated this lengthy encounter. Now the leading automobile manufacturer in the country, in the words of the New York
Times,
had intervened with an act of “originality and daring.” “What marvels might not Mr. Ford's example work if only other capitalists would do the same,” the editorial asked. “And what miracles might not the world see if capital and labor should cooperate on the same lines.” Other newspapers agreed that the Five-Dollar Day would bridge the chasm between workers and owners with a new spirit of cooperation. In the words of the Peoria, Illinois,
Transcript,
Ford's plan was “a shining example for other employers of labor and if his experiment proves a success, it may blaze paths in the realm of profit-sharing which have received so much attention in theory and so little in practice.”
³⁸

Not surprisingly, American labor leaders praised the Ford initiative. Samuel Gompers, the president of the American Federation of Labor, released a public letter noting that “the attitude of Henry Ford toward orga
nized labor and toward his employees has always been fairer than usually obtains in the automobile establishments of the United States.” The Five-Dollar Day, he continued, would ”demonstrate its justice“and prod further reforms in American industry in terms of wages, working conditions, and hours. The Illinois Federation of Labor endorsed Ford's plan, stating that such ”cooperation will be the solution of the labor wars in the country. It shows the right spirit in the employer and indicates that he understands his duty as a capitalist towards the masses of his employees.” E. P. Usher, president of the Toledo Central Labor Union, described Ford's new policy as ”an advance in the method of dealing with labor by the manufacturers.” Thomas E. Burke, an official with the United Association of Plumbers, Gasfitters, and Steamfitters, contended that the Five-Dollar Day was ”the last thing in unselfishness and so altruistic that it rises far above any previous innovation in the commercial world.”
³⁹

But not everyone was convinced of the Five-Dollar Day's virtues. Many in the business community were skeptical of Ford's new wage policy. “Revolutionary” change and doubled wages did not sit well with Wall Street bankers, small businessmen, or competitors in the automobile industry.
The Wall Street Journal
led the counterattack. “To inject ten millions into a company's factory, and to double the minimum wage, without regard to length of service, is to apply Biblical or spiritual principles into a field where they do not belong,” it asserted. “[Ford] in his social endeavor has committed economic blunders, if not crimes. They may return to plague him and the industry he represents as well as organized society.” A corporate manager in New York dismissed the Five-Dollar Day as “the most foolish thing ever attempted in the industrial world” and promised that it would “only result in unrest among the laboring classes.” Samuel Tilton, manager of auditing at Security Trust Company in Detroit, praised Ford for his altruistic spirit but insisted that most companies had thin profit margins and would be bankrupted by raising wages so dramatically. The average businessman, he said, “sees the lamp of Aladdin, but cannot touch it.”
⁴⁰

The automobile industry was in shock following Ford's wage hike. The evening after the announcement, Alvin Macauley, president of the Packard Motor Car Company, phoned Charles Sorensen and complained, “What are you fellows trying to do? We got the news about your $5 day while we were having a board meeting. It was so astonishing that we broke up the meeting.” Many automakers denounced the move, often with considerable bitterness. Contacted at the New York auto show a few days after the announcement, leading manufacturers such as Hugh Chalmers, Windsor T. White, Otis O. Friend, and C. W. Meers told reporters that Ford's precipitate action promised to throw the labor market into utter turmoil and harm
the entire industry. Moreover, they insisted, Henry Ford might be wealthy enough to dabble in utopian experiments, but no one else had such means available. As J. J. Cole said bluntly, “If Ford wants to amuse himself, all right. He can afford it. Others can't.” Growing companies such as the General Motors Corporation raised wages slightly to compete with Ford, but were not able to meet the $5.00standard until years later.
⁴¹

The forces opposing Ford's new policy were joined by a few newspapers. The Pontiac, Michigan,
Press,
complained that this dramatic pay raise, if adopted by companies nationwide, would launch a great wave of price increases as those companies struggled to fund higher wages. Higher prices would mean no real gain in purchasing power. Other papers wondered whether employees were willing to share in the market risks faced by their employers. Though taking a cut of company profits was attractive, “it is when loss-sharing is included that the pinch will come,” one noted. Another sharpened the argument: even though workers “are quite willing to share in the prosperity few are ready or can afford to share in their employer's adversity.”
⁴²

These pockets of dissent, however, remained small and scattered. A great chorus of affirmation for Ford's Five-Dollar Day came from nearly every segment of opinion in the United States. One approving group drew special attention. For perhaps the first time, an American business tycoon became the darling of the political left.

Two years after the announcement of the Five-Dollar Day, John Reed, the noted leftist gadfly and soon-to-be friend of the Russian Revolution, visited Detroit to interview Henry Ford. He toured the Highland Park factory and spoke with Ford workers, and was also welcomed at Ford's home, where he talked at length with the automaker and probed his thoughts about social and political issues. He interviewed Ford's neighbors and associates for insights into his character and business philosophy. When he returned to New York, Reed wrote a pair of articles that conveyed his favorable impressions.

“Why They Hate Henry Ford,” published in
The Masses,
examined Ford's profit-sharing scheme in light of the hostility it aroused among many American big businessmen. The $5.00wage, Reed asserted flatly, had made Ford a traitor to his class. “That is why the capitalists hate Henry Ford. That is why the Steel Trust would like to cut off his steel—and Wall Street curb his power.” This wage reform, in Reed's assessment, had demonstrated Ford's concern for social and economic justice over merely making more
money. In Reed's ringing phrase, “This new Ford plan is turning into something dangerously like a real experiment in democracy, and from it may spring a real menace to capitalism.” A second article, “Industry's Miracle Maker,” which appeared in
Metropolitan Magazine,
reached the same conclusion. “He is that most dangerous of revolutionists—a man who translates platitudes into action,” Reed wrote of Ford. “Here is a powerful industrial baron who is interested in human beings instead of stocks and bonds.”
⁴³

John Reed's approbation was symptomatic of a much larger trend in the aftermath of the Five-Dollar Day announcement. Over the next several years, leftists of every stripe—socialists, radical progressives, liberal reformers, labor activists—competed with one another in praising Henry Ford. They argued that his wage scheme promised to heal the wounds of class conflict by signaling the long-awaited recognition by capital of the debt owed to labor. It announced a new day, when industrialists and laborers, management and workers would cooperate rather than clash, and achieve justice and prosperity for all. The irony was profound. For several years after 1914, the political left raised to heroic status a man who was rapidly becoming the wealthiest businessman in the United States.

The panoply of progressives supporting Ford ranged widely. At the local level, Detroit leftists such as the “gentle anarchist” Jo Labadie and socialist organizer Robert A. Westfall endorsed the Five-Dollar Day as a marked advancement toward improving economic conditions and increasing justice in the modern industrial system. The Michigan Socialist Party published a pamphlet full of praise entitled
The Bombshell That Henry Ford Fired.
William A. Moore, a Detroit pastor influenced by the Social Gospel movement of the early twentieth century, defended Ford against attacks by other businessmen. He preached a much-publicized sermon that described big business as “conservative and afraid.” “Dollars will not lead into heaven, for the road to heaven leads up hill,” he told listeners. “Some one must voluntarily give up something for a weaker brother.” Ford's wage innovation, Moore concluded, established “the beginning point for a new era in the relations between capital and labor.”
⁴⁴