"Brewing Corporate Consolidation: Labor Relations, Financialization, and Regulation at Blatz Brewing, 1885-1920"

In 1891 the Blatz Brewing Company—one of four major national shippers—joined five Chicago rivals to form Milwaukee & Chicago Breweries, Ltd. This was the second largest of 24 American brewery mergers organized by English syndicates between 1888 and 1892. Mary O’Sullivan has identified this English mania for brewing assets as a pivotal step in the development of markets for American industrial securities. This market and corporate promoters’ growing skill navigating it were key preconditions for the great merger movement, which witnessed 1,800 firms disappear into 157 horizontal combinations between 1895 and 1904. Though spectacular consolidations like U.S. Steel and International Harvester have rightly gained significant historical attention, most of these mergers were less ambitious—embracing smaller market shares, niche sectors, or regional markets.
This paper will build upon recent scholarship with a close study of one these more quotidian but foundational early consolidations that laid the groundwork for the merger movement—linking the history of Anglo-American financial syndicates with the firm’s management and labor histories. Like all historical case studies, Blatz and its successors’ experiences also reflected some notable sectoral specificities. Soon after transferring its assets to the new trust, Blatz joined with Milwaukee’s other eight notable brewers in ending a six-year labor conflict by recognizing a closed shop and embracing collective bargaining with an industrial union—decades before the practice became common. This labor policy not only reflected brewery managers and laborers’ shared ethnocultural background and antipathy to the Prohibition movement but also the former’s strategy of interfirm cooperation via loose association that proved at least as successful as tight combination in the late-nineteenth century brewing industry—destabilizing received views about the relationship between interfirm cooperation, unionization, and trustification.