Edward Ball (businessman) - Railroads

Railroads

The Stock Market Crash of 1929 and subsequent Great Depression were particularly hard on the Florida East Coast Railway (FEC). The railroad declared banktuptcy and was in receivership by September 1931, just 18 years after Henry Morrison Flagler’s death. Bus service began to be substituted for trains on the branches in 1932, and the Key West Extension was abandoned after the Labor Day Hurricane of 1935. However, streamliners terminating in Miami nevertheless plied the rails between 1939 and 1968, including such famous trains as The Champion and The Florida Special jointly operated with the Atlantic Coast Line. Adding to the woes was the Cuban embargo, thus reducing a significant portion of FEC's revenue.

In 1961, Ball purchased a majority ownership of FEC for the DuPont Trusts, allowing the FEC to emerge from bankruptcy. That same year, a labor contract negotiation turned sour, leading to a prolonged work stoppage by non-operating unions beginning January 23, 1963, and whose picket lines were honored by the operating unions (the train crews).

Arguably the most noteworthy chapter in Ball's business career was his battle against the railroad unions in the Florida East Coast Railway strike of 1963 to 1977. In order to try to save the railroad from its three decades-long state of bankruptcy, which if allowed to continue would have threatened the railroad with physical deterioration and even partial abandonment, Ball fought for the company's right to engage in its own contract negotiations with the railroad unions rather than accept an industrywide settlement that Ball thought would include featherbedding and wasteful work rules. His use of replacement workers to keep the railroad running during the strike led to violence by strikers that included shootings and bombings. Eventually, Federal intervention helped quell the violence, and the railroad's right to operate during the strike with replacement workers was affirmed by the United States Supreme Court. As the strike continued, the Florida East Coast took numerous steps to improve its physical plant, install various forms of automation, and drastically cut labor costs, all to an extent that most other railroads would not succeed in matching until years later. Ball therefore was a pioneer in the American railroad industry's struggle, beginning in the 1960s, to improve its economic efficiency.