They used to call it Bonus Hill. That was section of Bethlehem’s Prospect Avenue where Bethlehem Steel executives, made rich by the bonuses they acquired from the booming industry that employed them, had their mansions. But none came close to 1317 Prospect Avenue. From 1923 until 1960, it was the home of Eugene Gifford Grace, president and CEO of the Bethlehem Steel Corporation, the second largest steel maker in America, and perhaps in the world.
Grace was never known for having a fanciful imagination, which is why it seems odd that that he gave his home the romantic sounding name of Uwehlan, Welsh for “the land over the valley.” Here, amidst enough tuxedoes and evening gowns to cloth the cast of a Fred Astaire and Ginger Rogers musical, the elite of the steel company came to hear Bing Crosby (a golfing buddy of Grace) and other stage and Hollywood luminaries entertain. They might even run into Astaire, another of Grace’s golfing chums. The guests would dance in the ballroom, or perhaps lay their expensive wraps on a bed in one if its 23 bedrooms. A garden as big as a city block and surrounded by a brick wall with extensive landscaping was available for those seeking a breath of air. And if any of the “hoi polloi,” aka ordinary folk, got a little to curious, Grace’s own security guards were on hand to shoo them away.
This Xanadu on a hill was not Grace’s only pleasure dome. There was the house in Southampton on Long Island’s Gold Coast and the suite in New York’s swanky Plaza Hotel. And winters were spent at a home in Aiken, South Carolina. Here to sharpen up his golf game, along with Crosby, were golf greats of the inter-war years like Bobby Jones and Gene Sarazen. “ At lot of the Aiken people were horsey set people,” recalled his grandson, Charles Grace, Jr., “but my grandfather didn’t keep horses, just played golf.”
But Grace was not some sort of social butterfly. Behind his desk he was a hard-driving captain of industry. “Always More Production” was more than just a slogan. Unlike his early mentor, Charles “Charlie” Schwab, he didn’t care if he was liked or not. Although neither Schwab nor Grace wanted to see unions and used force to keep them out, Schwab had a soft spot in his heart for individual workers, who he was convinced were being misled by labor agitators. He remembered their children’s names and although he did not smoke, gave cigars to those he might meet.
Grace looked at life differently and regarded most average steel workers as employees that he dealt with abruptly. Apparently only the fear of losing lucrative government defense contracts on the eve of world war led him to allow the introduction of unions in 1941 following a fierce strike.
Even Grace’s arrivals at the office were designed to let everybody know who was boss. Two Bethlehem Steel police would keep a watch for Grace’s chauffer driven car. When it was spotted a signal was sent to the office building. All the elevators were stopped at the nearest floor. Once their occupants, if any, exited, the elevators all dropped to the building’s lobby floor. Once he arrived, Grace would pick the elevator he wanted and rose alone in splendid isolation to his office.
Eugene Grace and Bethlehem Steel, which closed for good 43 years ago, are now part of America’s industrial history. In two world wars it was the Steel that was the largest single producer of weapons for the Allied cause. To Bethlehem Steel, under Grace’s reign the nation owes the graceful Golden Gate Bridge and most of the 20th century New York skyline, as well as skylines of many other American cities. And like him or hate him, no one could deny his significant and important role in the country’s history.
Perhaps Grace's approach to life had something to do with his father, a retired ship’s captain. Born on August 27, 1876 in the small town of Goshen, New Jersey, not far from Cape May, he and his brother clerked in his father’s store at an early age. By the time he was in high school Gene Grace had learned two things: the value of hard work and a passion for baseball. He got a scholarship to Lehigh University. His baseball skills led Grace to come to the attention of a Boston team that offered him $200 a month. But professional baseball being what it was in the late 1890s, Grace could see no future in it. “I don’t think I went to Lehigh to learn to play baseball,” he was to say later.
It was after seeing his outstanding performance on the ballfield against Lehigh’s hated rival Lafayette that Archibald Johnston, a Bethlehem steel executive, offered Grace a job as an electric crane operator at $1.80 a day, 15 cents an hour. But when he caught the eye of Bethlehem Steel’s owner Charles Schwab, his rise began. When Schwab sent him to Cuba to untangle some problems at mines there, he did so successfully, and Schwab brought him back to the Bethlehem. From there Grace’s rise was steady. By 1906 he was general superintendent, by 1911 a vice president and by 1915, at the tender age of 39 (the same age that Schwab was when he took over U.S. Steel), he was named president of the corporation.
Grace would go on proving his worth to Schwab by his efficient running of the Bethlehem plant during World War I. By 1922, Schwab had basically turned over running the company to Grace while he represented the company’s public image and dabbled in the stock market. The 1920s were very good years for Grace. Along with establishing his home on Bonus Hill, he played a significant role in the creation of the Saucon Valley Country Club. Although Grace never held any official title other than chairman of the Green’s Committee from 1923 to 1960, no one had any doubt about who was really in charge. By the decade’s end he was the highest paid executive in America.
But, in 1929, even as the rivet guns of construction crews were keeping New Yorkers awake, turning Bethlehem Steel H beams into skyscrapers, the bottom dropped out of the stock market, ushering in the Great Depression of the 1930s. Bethlehem Steel was soon only running 3 days a week. To Grace’s credit he used that time to keep the company’s equipment in shape. By the late 30s, rising war clouds in Europe led the U.S. Navy to send government contracts its way. Grace, who hated President Franklin Roosevelt with a passion (he once excluded a family member from using the company suite at the Plaza Hotel when she told him she voted for F.D.R.), knew better after a long struggle not to let it get in the way of business. ”Gentlemen,” he told his foursome of Bethlehem Steel executive at the Saucon Valley Country Club in 1939 when war was declared in Europe, “we are about to make some money.”
Following the strike of 1941 came the bombing of Pearl Harbor and Bethlehem Steel and Grace’s finest hour. To defeat the Axis of Evil, Grace put all of his considerable energies into the war effort. His shipyards were turning out more than a ship a day as the conflict grew hot. By V-J Day in 1945, with most of the rest of the world’s industrial might in ruins, Bethlehem Steel and Eugene Grace were kings of the hill.
By the 1950s Grace, though still in charge, was slipping into the role of elder statesman of steel. But historians note today that Grace may have already planted some of the seeds of the company’s future troubles. Unlike Schwab, he refused to groom a designated successor. For another, he had trained generations of young executives that there was only one way for steel to be made: Bethlehem Steel’s way, with huge plants employing thousands of workers and managers shipping entire train loads of iron ore. In the 1950s and early 60s, mini-mills and the recovering steel industries in Europe and Asia with more modern equipment were, if not ignored, simply dismissed. But perhaps in truth Bethlehem Steel’s way of doing business made it simply too cumbersome to respond to the changing world around it. As much as it might have tried, it was too late by the 1970s.
Grace died on July 25, 1960. The funeral at Lehigh’s Packer chapel included David Rockefeller, a son of John D. Rockefeller Jr,. and then vice chairman of the Chase Manhattan Bank. Taken to a monumental tomb at Nisky Hill Cemetery, it sparked a legend that he was buried standing up so he could keep an eye on Bethlehem Steel. Not true, of course, but very typical of Grace and the larger than life way people remembered him.
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December 28, 2019 at 06:00PM
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History's Headlines: Eugene Grace, prince of steel - WFMZ Allentown
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