Henry Ford’s Own Story/Chapter 25
CHAPTER XXV
FIVE DOLLARS A DAY MINIMUM
The Seldon patent fight had continued through all the early years of Ford s struggle to establish himself in business. At last it was settled. Ford won it. The whole industry was freed from an oppressive tax and his long fight was over.
Immediately, of course, other cars came into the low-priced field. Other manufacturers, tardily following Ford, began the downward pressure in prices which now makes it possible for thousands of persons with only moderate means to own automobiles. For the first time Ford faced competition in his own price class. Innumerable business problems confronted the farmer-mechanic, from the time he opened his office doors in the early morning until the last workman had left the plant and only his light was burning. Business men came, financiers, sales men, lawyers, designers. Every day for two hours he conferred with his superintendents and foremen in the main factory. Every detail of the business was under his supervision. A smaller man or a less simple one, would have been absorbed by the sheer mass of work.
Ford settled every problem by his own simple rule, "Do what is fundamentally best for everybody. It will work out for our interests in the end."
And always he was pondering the big problem of putting back into active use the millions that were accumulating to his credit. Every year the price was lowered on his cars, following his original policy of making the automobile cheap. Still the sales increased by leaps and bounds, and his margin of profit on each car mounted into a greater total.
"The whole system is wrong," he says. "People have the wrong idea of money. They think it is valuable in itself. They try to get all they can, and they've built up a system where one man has too much and another not enough. As long as that system is working there does not seem any way to even things up. But I made up my mind to do what I could.
"Money valuable? I tell you, gold is the least valuable metal in the world. Edison says it is no good at all, it is too soft to make a single useful article. Suppose there was only one loaf of bread in the world, would all the money on earth buy it from the man who had it? Money itself is nothing, absolutely nothing. It is only valuable as a transmitter, a method of handling things that are valuable. The minute one man gets more of it than he can use to buy the real things he needs, the surplus is sheer waste. It is stored-up energy that is no good to anybody.
"Every bit of energy that is wasted that way hurts the whole world, and in the end it hurts the man who has it as much as it hurts anybody. Look here, you make a machine to do something useful, don t you? Well, then, if it is built so that it keeps wasting energy, doesn't the whole machine wear itself out without doing half as much as it should? Isn't that last energy bad for every part of the machine? Well, that is the way the world is running now. The whole system is wrong."
A very little thought brings almost any of us to that conclusion, especially if the thinker is one whose surplus money is all in the other man's bank account; but Ford held to that thought, as few of us would, with the surplus millions in his own hands. Furthermore, he proposed not merely to think, but to act on that thought.
He is not a man to act hastily. Before he made his engine he worked out the drawings. Before he distributed his money he selected men from the workers in his shop and sent them out to learn all they could of the living conditions of the other thousands. They worked for a year, and at the end of that time Ford, going carefully over their reports, saw plainly where his surplus money should go.
Over 4,000 of the 18,000 men working in the Ford plant were living in dire poverty, in unspeakable home conditions. Families were huddled into tenements, where in wet weather water stood on the floor. Wives were ill, uncared for; babies were dressed in rags. Another 5,000 men in his employ were living in conditions which could only be called "fair." Only 364 out of 18,000 owned their own homes.
Yet the employees in the Ford shops were above the average of factory workingmen. They were paid the regular scale of wages, not overworked, and their surroundings at the plant were sanitary and pleasant.
In those terrible figures Ford was seeing merely the ordinary, accustomed result of the wasted energy represented in those idle millions of dollars.
He went over them thoroughly, noting that the scale of living grew steadily better as the salaries increased, observing that the most wretched class was mainly composed of foreign workmen, ignorant, unskilled labor, most of them unable to speak English. He figured, thought, drew his own conclusions.
He had been studying relief plans, methods of factory management in Germany, welfare work of all kinds. When he had finished his consideration of those reports he threw overboard all the plans other people had made and announced his own.
"Every man who works for me is going to get enough for a comfortable living," he said. "If an able-bodied man can't earn that, he's either lazy or ignorant. If he's lazy, he's sick. We'll have a hospital. If he's ignorant, he wants to learn. We'll have a school. Meantime, figure out in the accounting bureau a scale of profit-sharing that will make every man s earnings at least five dollars a day. The man that gets the smallest wages gets the biggest share of the profits. He needs it most."
On January 12, 1914, Ford more than satisfied the expectant manufacturers of the world. He launched into the industrial world a most startling bombshell.
"Five dollars a day for every workman in the Ford factory!"
"He's crazy!" other manufacturers said, aghast. "Why, those dirty, ignorant foreigners don't earn half that! You can't run a business that way!"
"That man Ford will upset the whole industrial situation. What is he trying to do, anyhow?" they demanded when every Detroit factory workman grew restless.
The news spread rapidly. Everywhere workers dropped their tools and hurried to the Ford factory. Five dollars a day!
When Ford reached the factory in the morning of the second day after his announcement, he found Woodward avenue crowded with men waiting to get a job in the shops. An hour later the crowds had jammed into a mob, which massed outside the buildings and spread far into adjoining streets, pushing, struggling, fighting to get closer to the doors.
It was not safe to open them. That mass of humanity, pushed from behind, would have wrecked the offices. The manager of the employment department opened a window and shouted to the frantic crowd that there were no jobs, but the sound of his voice was lost in the roar that greeted him. He shut the window and telephoned the police department for reserves.
Still the crowds increased every moment by new groups of men wildly eager to get a job which would pay them a comfortable living. Ford looked down at them from his window.
"Can't you make them understand we haven't any jobs?" he asked the employment manager. The man, disheveled, breathing hard, and hoarse with his efforts to make his voice heard, shook his head.
"The police are coming," he said.
"Then there'll be somebody hurt," Ford predicted. "We can't have that. Get the fire hose and turn it on the crowd. That will do the business."
A moment later a solid two-inch stream of water shot from the doors of the Ford factory. It swept the struggling men half off their feet; knocked the breath from their bodies; left them gasping, startled, dripping. They scattered. In a few moments the white stream from the hose was sweeping back and forth over a widening space bare of men. When the police arrived the crowd was so dispersed that the men in uniform marched easily through it without using their clubs.
For a week a special force of policemen guarded the Ford factory, turning back heartsick men, disappointed in their hope of a comfortable living wage.
It was a graphic illustration of the harm done the whole machine by the loss of energy stored in money, held idle in the hands of a few men.