COMPANY TOWNS, 1956

The Growth of the Model Community

Saint Peter, don't you call me, 'cause I can't go,

I owe my soul to the company store.

A THOUSAND times a day. U.S. jukeboxes moaned out Sixteen Tons, a Tin Pan Alley folk song about a coal miner who is soul-deep in debt to his employer. The song landed with a sixteen-ton impact because of its tootling orchestration and Tennessee Ernie Ford's richly lugubrious style. To the jukebox generation the words were all but meaningless. Yet, as late as the 1920s, the ballad's bitter plaint was a real-life refrain to millions of U.S. workers from Georgia's green-roofed cotton villages to Oregon's bleak lumber settlements. Those workers had lived, like Composer Merle Travis' coalminer father, in company towns--drab, depressed communities where the worker traded at a company store,* rented a company house, was watched by company cops. Today company towns are still flourishing in the U.S. But the towns, and the tune, have changed.

Typical of today's company towns is New Cuyama, a California community that sprang up from the sagebrush after Richfield Oil Corp. made the state's biggest petroleum strike of the decade in a barren desert valley southwest of Bakersfield eight years ago. Determined to create a community that would match its underground wealth, Richfield sold 201 model homes at cost to employees, put up a handsome shopping center and leased it to independent merchants. The company also provided a $75,000 community hall, a $250,000 motel-restaurant, a $20,000 playground, plus land for two new churches and a $1,500,000 high school. Says a Richfield executive: "Most of these families never owned a home before. Now they are settling down to grow with the valley."

Treat People Like People

The big change in company towns stems from the social and economic maturity of U.S. industry. Community and employee relations are as important a factor in modern management as raw materials, markets and transportation. Most companies today bend over backward to be good neighbors in their communities. Industry's new attitude to community relations was simply defined by Troy Blanket Mills' Vice President E. J. Russell, whose company has been the only industry in Troy, N.H. for 75 years. Said he: "People like to be treated like people."

No More Lock, Stock & Barroom

To treat people right, most big corporations, e.g., Ford, Alcoa, G.M., now employ top-level executives to concentrate exclusively on community relations. On the other hand, Du Pont, which operates 69 plants in 25 states, says each plant manager is "Mr. Du Pont in his community . . . the way he runs his plant constitutes the major part of Du Pont's public relations program."

One example of a Du Pont town is Seaford, Del., an oldtime oyster fishing village, where the company built its first nylon plant in 1938. Instead of transforming sleepy Seaford into a grim, grimy industrial community, Du Font's coming has turned the town into an attractive outpost of suburbia, with its own Du Pont-built country club and nine-hole golf course, a choir and community concerts, schools of dancing and ballet, a new 40-bed hospital and a $180,000 Roman Catholic church. Unlike 19th century company town citizens, whose houses huddled close to mine or mill, two-thirds of Du Font's 2,900 employees commute to work each day from communities in a 50-mile radius.

While the automobile has enabled workers to live--and shop--where they choose, higher wages and Government-backed housing loans have enabled millions of Americans to own their own homes. Few towns today are owned lock, stock and barroom by any company. Weary of worrying about rent and retail markups, employers have sold whole towns outright, e.g., Kennecott Copper Corp.'s company houses in four western states were traded off last December for $5,000,000. (The U.S. is even unloading its atom towns, recently announced plans to sell Oak Ridge, Tenn. and Richland, Wash.) In most cases companies selling housing are glad to plow their investment back into worthwhile community projects. Cannon Mills, which in recent years has encouraged employees to buy and build homes in 50-year-old Kannapolis, N.C. (pop. 28,000), has given money and land for a number of the town's 84 churches, built a golf club for its 14,000 employees, and contributed most of the cash for a civic auditorium.

Stop Sign at "Venus Alley"

No oldtime company town in the U.S. better typifies industry's modern attitude than Butte, Mont. For more than 70 years, on the "richest hill on earth," Butte's copper miners and mining operators were locked in a bitter feud that often flared into shootings, lynchings, street battles and mass sabotage. The town was grimy and corrupt, demoralized by frequent shutdowns, cynically proud of its sleazy clip joints. But after a costly strike in 1946, an industrial engineering company was hired to find out what ailed Butte. The survey that resulted rapped Anaconda Co. for its neglect of community responsibilities, e.g., recreation and education.

In quick succession Anaconda backed a housing program that provided homes for 650 families, v. 150 houses completed in the previous 15 years, invested in a hospital, a civic auditorium and a $400,000 club where C.I.O. miners were soon bowling and drinking beer with the once-hated "sixth floor boys," i.e., Anaconda executives. The company also cooperated in clamping down on "Venus Alley," helped slash the worst VD rate west of the Mississippi to 3.2 per 1,000 residents. Today, in the town John Gunther once called "the only electric-lit cemetery in the U.S.," signs in merchants' windows proclaim: "Butte is my home. I like it."

In the new company towns that are still going up in the U.S., community planning is considered a vital factor in attracting a stable, skilled work force. The modern company town is usually a model community with broad, tree-lined streets, spacious shopping centers (which invariably are leased to local merchants) and well-built housing designed to encourage home ownership.

In Silver Bay and Babbitt, two five-year-old taconite mining communities built by Reserve Mining Co. in remote northeastern Minnesota, company-built homes are sold to employees on longterm, no-cash-down mortgages held by the company. Says Reserve President W. M. Kelley: "Good communities are essential to our operation. If we are to compete successfully, we must continue to attract skilled, high-type men who want to own their own homes and run their own communities."

One of the best-run towns in the U.S. is Midland, Mich., a trim, 50-year-old company town (pop. 24,000) where 86% of the houses are owned by employees of Dow Chemical and Dow Corning. In the 1952 presidential election, Midland boasted the highest voter turnout (81%) of any similar-sized U.S. community.

Ski Tows, Scholarships & Woods for Scouts

Since most company communities exist to exploit oil or ore discoveries in remote areas, management generally invests lavishly in recreational facilities to attract and keep a high-caliber work force. In Colorado, Climax Molybdenum Co. has equipped the inaccessible Rockies settlement of Climax (where it operates the country's largest underground mine) with ski tows, a $31,700 youth center, a $106,000 recreation hall with bowling alleys, library, target range and gymnasium, a $128,000 skating rink and a TV booster to bring in programs from distant stations. Crown Zellerbach Corp., which runs three lumber company towns in Washington and Oregon, concentrates on youth activities, allots timberland tracts to Boy Scout troops, awards college scholarships to company town children.

Most companies nowadays work many months in advance when they plan to move into small towns which have had no previous experience with big payrolls. Executive teams go in to discuss economic and social problems with civic officials and community leaders, show films to familiarize residents with their operations.

Before building a new smelting plant that subsequently trebled the 2,000 population of Rockdale, Texas, Alcoa in 1953 paid an estimated $30,000 advance taxes to finance new road and school construction. To pave the way for a new jet test flight center in Palmdale, Calif., Lockheed Aircraft Corp. hired a professional city manager, who spent two years helping city officials plan for expansion, lured three other aircraft companies to Palmdale.

While most companies do all they can to help with recreational and cultural projects, management takes pains to avoid dominating local governments or creating a feeling of passive dependence on company paternalism. When Shell built a new $75 million refinery in little Anacortes, Wash, last year, employees were advised to ''be helpful but go slow" in civic activities. A company executive explained. "We were very careful not to lead residents to believe we were going to be the great white father." Said Editor Wallie Funk of the Anacortes American Bulletin: "Only a few of us suffered any Shell shock."

No Mortgage on the Soul

Management's imprint on community affairs is still apparent in some old established company towns. In Dow Chemical's Midland there are no hard liquor bars because "the Dow family wouldn't like it." In some company towns, particularly in the South, management frankly uses paternalism as a weapon against unionism.

But the dignity-crushing subservience that once bound mill hand to boss has almost disappeared from the U.S. company town. Industry is generally aware that output will be consistently higher in bright, well-run communities where employees are proud to live and work. Civic leaders, for their part, find that industry not only brings in new payrolls and tax revenue but good neighbors as well. Today's company town citizen owes responsibility to his community and his job. But the company holds no mortgage on his soul.

* Which often charged such exorbitant prices that Pennsylvania mineworkers in 1902 accused the coal operators of making profits "not only from mining coal but by mining miners." Many companies fired employees who shopped at independent stores. One of the worst company storekeepers: John D. Rockefeller Jr., whose Colorado Fuel & Iron Co. refused to give miners the right to shop where they chose until after a strike in 1913.

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