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Bethlehem Essay

838 words - 4 pages

Bethlehem steel: Builder of Arsenal of America is historical analysis of the late Bethlehem Steel Corporation. Kenneth Warren writes this book; Kenneth Warren is scholar of the America steel industry and knows about industry very well.
In the early chapters, Warren shows why western Pennsylvania became the major region for iron making in the United States during the second half of the nineteenth century, overtaking the small Bethlehem Iron Company of eastern Pennsylvania. The company’s geographical location hindered the development of Bethlehem city during these years, while contributing to the growth of the Pittsburgh region. Western Pennsylvania’s proximity to bituminous coal in West Virginia, cheaper water transportation on the Great Lakes, access to high quality Lake Superior iron ore, and closeness to expanding railroad construction in the Midwest made possible the dominance of Pittsburgh in iron production. At the same time, Bethlehem Iron continually struggled in eastern Pennsylvania because of declining demand for rails; as railroad construction fell off in the East, a preponderance of lower quality anthracite coal and dependence on more expensive, often over land transportation to markets. Still, Warren admires the efforts of early leaders Robert Heysham Sayre, John C. Fritz, and Joseph Wharton who “survived” the extended challenge from western Pennsylvania. Bethlehem leaders worked hard to find new products and update equipment. By the 1880s–1890s, Bethlehem Iron cultivated a niche in the production of armor plate for the US Navy as well as foreign buyers, which allowed the company to participate with the powerful Carnegie Steel firm (later US Steel).
The middle chapters of Warren’s study examine Bethlehem Steel’s remarkable growth in the face of unstable market conditions. Formally, created in 1904, the early Bethlehem Steel Corporation thrashed initially to secure profits in the commercial steel industry. However, the company’s turn to fortune began during the 1910s, as the Great War melodramatically increased demand for Bethlehem Steel armor plate, munitions, and surprisingly large shipbuilding capability. As Warren suggests, wartime mobilization propelled Bethlehem Steel’s early development. During the years of World War I, the company earned $110 million dollars (6 times more than the company earned during the 9 years that preceded the war) and the stock price increased from $30 to $600. Warren expertly details how Bethlehem Steel president Charles M. Schwab built on the firm’s wartime success with bold investments in new facilities. For example, the firm acquired the massive plant at Sparrows Point in Baltimore in 1916, the Buffalo area Lackawanna works in 1922, and the Cambria Steel facilities in...

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