The Square Deal

One-line: George F. Johnson’s name for the Endicott-Johnson Shoe Company’s brand of “welfare capitalism” — provide enough for workers’ welfare (free healthcare, cheap housing, parks, an 8-hour day) that they feel like partners and don’t need a union, while the company stays consistently profitable.

What we know

• A near-utopian company town: free or near-free libraries, parks, hospitals, golf courses, pools, theaters, 6 carousels that could never be charged for, $10 bank books for newborns, houses financed/sold at a loss via its own housing corporation, free healthcare, an 8-hour day, and the most extensive medical plan in the country. (source: NPR The Square Deal; Unions, Unions Everywhere - Research)
• Built by the Endicott-Johnson Shoe Company, which made boots for the US military in both World Wars (~52M shoes/year). From the EJ pamphlet “A Workers First Lesson in The Square Deal”: “If you are faithful, loyal, and reliable you will earn a good living under fair conditions. You are, indeed, a part of the company. You are cared for when sick.” (Unions, Unions Everywhere - Research)
• The wager: “if you took care of your workers, you could be more competitive” — EJ stayed profitable “despite paying some of the highest wages in the industry.” In the 1932 downturn Johnson cut wages rather than lay anyone off. (Unions, Unions Everywhere - Research)
• Engineered to defuse unionization: in a ~15K-worker vote, 80% voted against the union, and Johnson said labor and capital could “live in harmony.” Critics noted the benefits were designed to make workers feel grateful rather than fairly compensated — “We’re making money for them.” (Unions, Unions Everywhere - Research)
• Gerald Zahavi (author of Workers, Managers, and Welfare Capitalism) gave the later verdict: “the Square Deal is an anachronism today. People don’t expect much from corporations.” The essay Unions, Unions Everywhere - Research argues against accepting that as inevitable. (Unions, Unions Everywhere - Research)

Context hub

• Unions, Unions Everywhere - Research — the central case study; the “if every employer were a George F., we wouldn’t need unions” argument.
• People: George F. Johnson (coined and ran the program) · Gerald Zahavi (historian).
• Concepts: Unions · City Building · Internalizing Negative Externalities.

Mentioned in

• Unions, Unions Everywhere - Research — the central case study; the “if every employer were a George F., we wouldn’t need unions” argument.