Meatpacking

The combination of the technologies of railroading and refrigeration resulted in the refrigerator car (reefer), introduced in 1870 but perfected in 1881, which in turn created the major industry of meatpacking. Prior to the Gilded Age, meatpacking utilized animals raised in the Midwest; was restricted to curing hams, salting pork (Cincinnati, the major center, was called “Porkopolis”), and some corning of beef; and could be done only in cold weather so as to retard spoilage. Fresh meat had to be butchered locally, and cities had their slaughterhouse districts. By 1870 the penetration of the West by railroads brought western cattle to packing centers like Chicago (its Union Stock Yards opened in 1865), and efficient reefers after 1881 enabled packers like Philip D. Armour and Gustavus F. Swift to aggressively market their dressed beef in eastern cities. To break down eastern consumer hostility against western beef, Swift established East Coast branches and refrigerated warehouses. Their success was such that shipments of dressed beef to urban centers replaced those of live animals to small slaughterhouses at those points. Most of the nation’s butchers no longer butchered; instead, they cut up carcasses slaughtered hundreds of miles away. In the early 1890s six large-scale firms—Armour, Swift, Cudahy, Morris, Hammond, and the kosher meat dealer Schwartz-child & Sulzberger—dominated the meatpacking industry. The Big Six, following Swift’s leadership, were integrated companies with their own purchasing units, packing plants, refrigerator cars, and branch houses.

The Big Six preferred cooperation to competition and, with Swift and Armour leading out, created an informal pool in 1893 with weekly allocations designed to produce a profit for all. By 1902 this “Beef Trust” was, with the antitrust movement underway, vulnerable. The Big Six managed, however, to continue their monopolistic practices that year when Armour, Swift, and Morris bought into the National Packing Company, which Hammond and some smaller companies had formed; although Cudahy and Schwartzchild & Sulzberger remained independent, they following its leadership in pricing and production quotas. By 1910 the meatpackers had abandoned National Packing at the behest of the Justice Department, but the Big Six understood each other so well that without any formal arrangement they simply continued to follow the prices set by Swift and Armour.

Further reading: Alfred D. Chandler Jr., The Visible Hand: The Managerial Revolution in American Business (Cambridge, Mass.: Harvard University Press, 1977).