The Triangle Fire—100 Years Ago

The year 1911 was an interesting year for the American economy. This was probably the high-tide of a fast-growing American Socialist movement.

The year saw a few important events which galvanized a lot of public opinion against capitalism. In May, the Supreme Court ruled against John D. Rockefeller’s mammoth Standard Oil trust. As a result, the company was broken up into 34 “Baby Standards.” Compare that to AT&T, which Judge Greene broke up into just seven companies.

(The major Standard Oil company lived on as Standard Oil of New Jersey. Their filling stations were known as Esso which came from the S.O. for Standard Oil. The courts allowed them to use Esso but only in certain states in the West and in Canada. The company finally got tired of the restrictions and changed their name to Exxon.)

Standard Oil had been on the defensive for a few years especially after Ida Tarbell wrote The History of the Standard Oil Company in 1904. Rockefeller got the last laugh. After the company was broken up, the stock prices soared and his net worth shot up to $900 million.

Another major 1911 event happened 100 years ago this Friday. The Triangle Shirtwaist Factory fire in lower Manhattan killed 146 garment workers. Most of the victims were young immigrant women (and girls) from Europe. The public found out that the working conditions were terrible. The managers had locked the doors to the stairwells and the fire department’s ladders weren’t long enough to reach the upper floors. Many of the girls jumped out the windows similar to what happened on 9/11. The piles of bodies also made it difficult for the fire department to get close enough to the building.

Even today, the Triangle Fire still ranks as the deadliest industrial accident in American history. The two owners were able to flee to safety. They were later tried for manslaughter and they won. They later lost a civil trial and had to pay a sum for each death.

That sum: $75.

The fire prompted a flurry of legislation requiring better working conditions. I highly recommend David Von Drehle’s Triangle: The Fire The Changed America.

I say that 1911 was probably the high-tide of the socialist movement in America because a lot of the legislative reforms took the energy out of the movement. In 1912, we got the Pujo Committee and the election of Woodrow Wilson (Eugene Debs, the Socialist candidate, got nearly one million votes or 5.99%). The following year, we got the Federal Reserve Act and the 16th Amendment which allows for an income tax.

The Socialist party also lost a lot of its popularity when it came out against America’s entry in World War I. It even got Debs arrested and he ran in the 1920 president election from his prison cell. Interestingly, all the Socialist parties in Europe voted for war. This was directly opposed to prevailing Socialist doctrine (“the proletariat has no fatherland”). A young Italian fascist, Benito Mussolini took note and decided it was better to organize workers by race instead of class.

What I find interesting is that before the Russian Revolution, socialism wasn’t seen as being in any way un-American. In fact, the areas where Socialists were the strongest are today some of the reddest states in the Union. The Socialist newspaper, An Appeal to Reason, was published in Girard, Kansas.

The most left-wing state of all was probably Oklahoma! The state gave Debs 16% of its vote in 1912. The mayor of Oklahoma City was a socialist and the state sent six Socialists to the state legislature. How times have changed! Oklahoma was McCain’s single-best state in 2008.

On one final note, ExxonMobil ($XOM) was formed in 1999 when Exxon merged with Mobil. Both companies were Baby Standards.

Posted by on March 23rd, 2011 at 11:41 am


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.