Bethlehem Steel’s first rolling mill and blast furnace were completed in 1863, and immediately put to work producing railroad rails and steel armor plating for the U.S. Navy. In the early 1880s, the Navy decided to upgrade its aging fleet and Bethlehem Steel won the contract to produce ordnance, large caliber guns, and battleships that played a pivotal role in America’s success in both World Wars. In 1943, CEO Eugene Grace promised President Franklin Delano Roosevelt that Bethlehem would produce a ship a day—he managed to outdo his ambitious promise by delivering 380 ships in a single year.
Bethlehem’s mills also manufactured steel used to construct some of the most famous structures in the country: The George Washington Bridge, Golden Gate Bridge, and Ben Franklin Bridge, as well as the Empire State Building, the Hoover Dam, the prison on Alcatraz Island, and Madison Square Garden. It would be nearly impossible to conceptualize what America’s manufactured topography would look like without its steel mills. At the end of World War II, with few global competitors, U.S. steel plants produced 72 percent of the world’s steel and 67 percent of the pig iron; Bethlehem Steel alone was producing 23 million tons of steel a year. It must have seemed like their dominion over the steel market would be eternal. It was this hubris that doomed them.
By the late 1960s, American steel manufacturers, who had been slow to incorporate new technologies into their mills, were competing with imports from smaller, more adaptable mills overseas that were as much as 20 percent cheaper. Unions hindered the adoption of automation and changes that would have improved efficiency, pension costs ballooned, and executive pay was disproportionately high, increasing expenses that scrappy competitors rising from the ashes of the destroyed industries in Europe and Japan didn’t have to build into prices to turn a profit. While these mini-mills seemed little more than an annoyance at first, soon they were beating out Bethlehem Steel for contracts on their bread-and-butter products like plate and structural steel.
Mergers and plant closures spread like wildfire through the industry in the 1970s, creating labor unrest and a pervasive sense of economic despair. Throughout the 1970s and 80s, even large manufacturers began to fold. While most of its steelmaking operations were suspended in 1982 and its plant in Bethlehem, Pennsylvania, ceased operations in 1995, Bethlehem Steel managed to limp along until its dissolution in 2003. The ripple effect from these closures still has a profound effect on American towns to this day, as many have failed to find any suitable replacement and consequently have watched in horror as once-thriving downtowns became wastelands of blighted shops and homes.