Another Tale of Two Cities
March 2004

George Pullman was pure entrepreneur. And Chicago in the mid 1800’s was the perfect time and place for entrepreneurs. The city was undergoing a rapid transformation from a swampy trading town into an engine of commerce and industry. It was a gold mine for the shrewd and inventive. George Pullman was both.

Chicago’s social elite and political bosses were in agreement that if their city were to ever achieve the status of greatness – like a Boston or New York – the soggy land had to be drained and the muddy streets raised. It would be a public works project of gargantuan proportions. But in 1860 labor was cheap and abundant, self-made engineers bragged confidently of their ability to transform the landscape, and the mood of the city pulsated with optimism. Pullman saw his opportunity.

Acres of downtown buildings had to be elevated or demolished, whichever was cheaper. An entire block – 350 tons of expensive, interconnected commercial real estate – needed to be lifted four feet to the new street level, a feat that would demand engineering genius. Enter the self-confident George Pullman. Drawing upon his experience as a youth back in New York helping his father move buildings for the widening of the Erie Canal, George boasted of an ingenious invention using hundreds of screw jacks that could raise mammoth structures without cracking the plaster on the walls.
He got the job.

It was his first really big break. It would not be his last. A string of lesser successes followed until Pullman landed upon an idea that would earn him an international reputation – the luxury railcar. Railroad travel in the mid 1800’s was bumpy, noisy and dirty. George calculated that people of means would pay a premium to ride in air-conditioned coaches, lounging in overstuffed chairs while being served superb food and fine wine. Sleeping cars with private bunks and soft mattresses could even be provided for longer trips. The idea and timing were right. In 1867, the first opulent Pullman car rolled off the production line to take its place in the history books of Americana.

The Pullman Palace Car Company, though expanding rapidly, suffered from one serious flaw, not in its design or marketing, but in its production – labor! Workers, so excited at first about having a steady job, quickly forgot their gratitude and turned to grumbling because their wages were not higher. Labor unions only made matters worse. They stirred up discontent and fostered worker resentment. They could hold George’s production lines hostage by their unreasonable demands. It was like having an unstable time-bomb planted in his factory, poised to explode without warning, wreaking havoc with his production schedule. And his profits! It was the one variable he could not seem to control.

It was on one of his business trips abroad that George spied a potential cure. The English industrialist George Cadbury who had outgrown his Birmingham chocolate factory was constructing an entire planned village around his new plant outside of the city. Pullman was intrigued. Unlike the hastily built company housing that many factory-owners were throwing up to house cheap labor, Cadbury’s town – called Bourneville – had wide paved streets, interesting architecture, spacious parks and recreation facilities, churches, and an ample shopping district. The larger homes for company management were nicely interspersed among the more modest bungalows of workers. There were even quarters for ailing and retired residents. Attractive model, Pullman thought, but did it make economic sense? Would this “garden village” idea pacify the factory workforce? And was it profitable?

Cadbury, Pullman was delighted to discover, was a businessman through and through. Though he provided his employees unheard of benefits like healthcare, recreation and a shorter work-week, these were proving effective labor-saving and waste-elimination tactics. Said Cadbury: “Behind all the athletics, the dentistry, the swimming baths, the meals, lies the supreme commercial objective – speed of hand coupled with accuracy of eye.” His wages may have been generous and the benefits costly but, he said, “the labor is concentrated, eager, effective.” It was the answer Pullman was looking for. Ignoring a number of the other significant features of the Bourneville experiment (like morning Bible studies at the plant, half-day Saturday’s to allow for family and recreational time, free healthcare for all workers, schools for children and part-time youth employees, to name a few) Pullman rushed back to Chicago with a plan spinning in his brain. He would build Pullman, a planned town of happy workers, immune to the crippling power of strikes. And make money in the process!

Pullman, the city, was soon making headlines just as Pullman, the railcar, had done. The grand Hotel Florence, named for George’s daughter, greeted dignitaries as they pulled into the new train station. The new factory was large and spacious and architecturally magnificent. Gingerbread houses with modern amenities lined paved streets, larger brick homes for top level management closest to the town square, smaller frame ones a bit more of a walk. It attracted international awards as “the world’s most perfect town.” “Beauty can improve the individual,” declared George, “and a businessman who understands this can benefit from it.” Visitors marveled at its charm and praised George Pullman for his genius and generosity. But the few insiders who knew how his deals were structured saw it less as benevolence than as a cunning means to control a workforce while pocketing tidy sums on their housing. Unlike Cadbury, who enabled his workers to purchase their own homes and businesses, Pullman retained ownership of the town. He even kept title to the picturesque community church, leasing it out to the highest denominational bidder.

But the utopian charm of town Pullman lacked one important element: a soul. George had missed what Cadbury believed to be essential, what guided his corporate decision-making – the created worth and dignity of every living person. No amount of architectural splendor proved sufficient to offset the feudal feel of the company-owned Pullman. Factory workers still had the clear sense that they were but commodities to be bartered, replaceable cogs in a powerful money-making machine. An eventual downturn in the economy forced layoffs, then wage cuts, but George “neglected” to reduce housing rents. When word got out that he was making excessive returns on his housing venture at the expense of his unemployed and underpaid workers, riots spontaneously erupted. Unions across the country staged sympathy strikes and boycotts, and the press condemned him for heartless indifference. Even some of his business investors turned against him. By the time he capitulated, his corrective measures were too little too late. Depressed, George went into seclusion. From behind drawn velvet drapes in his palatial home he watched helplessly as his empire began crumbling around him. Estranged from his wife and family, social standing lost, George Pullman grew sick in body and soul, and died a broken and despised man. (1897) His town was soon dissolved, the Pullman empire broken up and its assets sold off. Pullman’s parting order was to secure his body where angry grave robbers could not dig it up and desecrate it. His coffin was to be buried in a room-size cube of concrete reinforced with a lattice-work of heavy gauge steel T-rails. Here he lies to this day, protected forever from his workers.

Meanwhile, back across the pond in Bourneville, George Cadbury’s enterprise was flourishing. He was learning that paying his employees well, tending to their physical and spiritual well-being and encouraging ownership in the town was indeed good business. He extended loans to his workers enabling them to purchase their homes. Public land was placed in a trust. Though Cadbury recouped his personal investment with modest return, the trustees he appointed ensured that all revenues derived from leases, sale of homes and annual land-trust fees were reinvested exclusively in the community. Workers were loyal and productive, union confrontations were rare and amicably resolved, and community life was idyllic compared to the vice and congestion of nearby Birmingham. When Cadbury suspended his optional morning devotionals (which he himself led) because the workforce had outgrown the meeting place, employees protested so loudly that he was forced to resume them.

One hundred fifty years later, enveloped by greater Birmingham, Bourneville remains an oasis of health and prosperity. Affordable housing for seniors and young families remains interspersed among the grander homes of the more affluent and a spirit of neighborliness persists. The factory, which employs nearly half of Bourneville’s residents, is still viewed as a highly desirable place to work, its low turnover rate attesting to the value the company places on its workers. George Cadbury’s statue stands prominently as a revered centerpiece on the village green, his home now a college for educating emerging young leaders and a treasured museum of Bourneville history. And need anything be said about the success of Cadbury chocolates?



Those who cannot remember the past are condemned to repeat it. - George Santayana, 1905