Charles Michael Schwab built Bethlehem as we know it today: He united the city from four fractious municipalities. He built the Hotel Bethlehem. He helped create Lehigh Valley music groups and formed a mighty company that framed the New York City skyline with Bethlehem steel.

But he also was a notorious gambler, union buster and businessman of dubious ethics.

Schwab at age 39 was president of the biggest company in the world, United States Steel Corp. After personality conflicts there, he left to take over and remake another steel company, Bethlehem Steel Co., which he incorporated Dec. 10, 1904.

There, Schwab became known as a motivator of men.

One blast furnace superintendent publicly called him crazy for setting high production targets, according to a 1994 article in Audacity magazine.

Characteristically, Schwab told the man if he got the furnaces operating as efficiently as Schwab wanted, he would pay off the mortgage on the man's house. In a few months, the man had a mortgagefree house, and Schwab had efficient blast furnaces.

To diversify the company, Schwab, known by most as Charlie (he is unrelated to the discount brokerage by the same name) was interested in producing a wideflange steel beam in the shape of an H. It was a risky venture that required building a new mill to make an unproven product.

''I've thought the whole thing over,'' Schwab told his secretary, ''and if we are going bust, we will go bust big.''

In 1908, Bethlehem Steel began producing the beam that revolutionized building construction and made possible the age of the skyscraper. It also made Bethlehem Steel the second-largest steel company in the world.

An H-beam descendant, the Ibeam, became the company's logo.

Although Schwab was able to motivate workers, he made it clear he was calling the shots. He loathed labor unions. In 1910, he crushed a 108-day strike at Bethlehem Steel.

''I will not be in the position of having management dictated to by labor,'' he said.

It was not until 1941, two years after Schwab died, that organized labor arrived at Bethlehem Steel.

Schwab was not above questionable tactics.

During World War I, Schwab supplied the British with just about anything they could pay for. To circumvent U.S. neutrality laws, Schwab shipped goods to Canada;they were sent across the Atlantic from there.

He sold 65,000 tons of American rails to the Russian government for use on the Trans-Siberian Railroad. Schwab clinched the deal by bribing the mistress of the Grand Duke Alexis Aleksandrovich with a $200,000 necklace.

A gambler with flair, Schwab's trips to Monte Carlo made him an international celebrity.

But his contributions were not limited to steel. He was instrumental in combining Bethlehem, West Bethlehem, South Bethlehem and Northampton Heights into one city -- Bethlehem.

Schwab created the Hotel Bethlehem so his clients could stay at a classier place than the Sun Inn. At his urging, the Hill-to-Hill Bridge was constructed and Liberty High School was created.

And without Schwab's passion for music, there might not be a Bach Choir in Bethlehem today. He donated freely to the choir and persuaded its founder to move back to Bethlehem from California. He also was a staunch supporter of the Lehigh Valley Orchestra.

The stock market crash of 1929 wiped out Schwab financially. He died bankrupt on Sept. 19, 1939. But World War II, which began a few weeks before his death, made his holdings worth millions -- a fitting end to the man Thomas Edison once called the ''master hustler.''

                       

Courtesy of: http://www.bethlehempaonline.com/