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This Thing Called Goodwill: The Reynolds Metals Company and Political Networking in Wartime America

Published online by Cambridge University Press:  27 August 2019

ANDREW PERCHARD Open the ORCID record for ANDREW PERCHARD [Opens in a new window]
ANDREW PERCHARD*
Affiliation:
Andrew Perchardis professor at and the Head of the Management Research Centre, University of Wolverhampton Business School. The author would particularly like to thank the Virginia Museum of History & Culture (VMHC) for the award of Betty Sams-Christian/Mellon Fellowships in Business History in 2013 and 2015, and the staff for their support. He also thanks the Centre for Business History in Scotland, the Carnegie Trust for Universities of Scotland, and the Institut pour l’histoire de l’aluminium for their support of this research; the staff at the Library of Congress (Washington, D.C.) and the Lyndon Baines Johnson Library (Austin, Texas); Price V. Fishback for access to Reconstruction Finance Corporation data; and Neil Forbes, Stephen Mawdsley, Niall MacKenzie, and David McKinstry, as well as the editor, anonymous reviewers, for their comments and Lila Stromer for preparing the manuscript. Management Research Centre, University of Wolverhampton Business School, 10 Molineux Street, Wolverhampton, UK, WV1 1SG. E-mail: [email protected]
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Abstract

This article examines the Reynolds Metals Company’s political networking activities in Washington, D.C., and the state capitals of the U.S. South in the 1940s and 1950s. It argues that Reynolds’ astute recruitment of senior staff from federal and state governments, its adept building of elite networks in the legislative and executive branches, its judicious espousing of key political rhetoric (antitrust, regional development, national security), as well as its nurturing of Democratic circles in the South were crucial to their attainment of competitive advantage. This saw the company rise from being a new entrant in the U.S. primary aluminum production during World War II to the second-largest national producer by 1946 and a major global player by the mid-1950s. This same political networking was critical in maintaining that advantage after World War II in the face of competition from the Aluminum Company of America and the Canadian multinational Aluminium Company of Canada. Both “wartime” (covering the period from World War II and into the Cold War) and the legacy of government intervention (from the early twentieth century until the 1960s, including the New Deal) provided a fertile context for RMC’s business strategy. The company’s success owed much to founder Richard S. Reynolds Sr.’s acumen in hiring the right people, creating or joining the right networks, having the right social capital, as well as his experiences and connections accrued from working with his uncle, the noted tobacco magnate R. J. Reynolds. The article offers insights into the nature of U.S. business–government relations.

Type
Article
Information
Enterprise & Society , Volume 20 , Issue 4 , December 2019 , pp. 1044 - 1083
Copyright
Copyright © The Author 2019. Published by Cambridge University Press on behalf of the Business History Conference. All rights reserved. 

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References

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Brinkley, Alan. “The New Deal and the Idea of the State.” In The Rise and Fall of the New Deal Order 1930 – 1980, edited by Fraser, Steve and Gerstle, Gary, 85–121. Princeton, NJ: Princeton University Press, 1989.Google Scholar
Clawson, Dan. “A Business Celebration.” Contemporary Sociology 18 (1989): 545–546.CrossRefGoogle Scholar
Doh, Jonathan P., Lawton, Thomas C., and Rajwani., Tazeeb “Advancing Nonmarket Strategy Research: Institutional Perspectives in a Changing World.” Academy of Management Perspectives 26 (2012): 22–39.CrossRefGoogle Scholar
Frynas, Jedrzej George, Chold, John, and Tarba, Schlomo. “Non-Market Social and Political Strategies: New Integrative Approaches and Interdisciplinary Borrowings.” British Journal of Management 28 (2017): 559–574.CrossRefGoogle Scholar
Galambos, Louis. “The Emerging Organizational Synthesis in Modern American History.” Business History Review 44 (1970): 279–290.CrossRefGoogle Scholar
Galambos, Louis. “Technology, Political, and Professionalization: Central Themes of the Organizational Synthesis.” Business History Review 57 (1983): 471–493.CrossRefGoogle Scholar
Hawley, Ellis. “The Discovery and Study of a ‘Corporate Liberalism.’” Business History Review 52 (1978): 309–320.CrossRefGoogle Scholar
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Hogan, Michael J. “Corporatism: A Positive Appraisal.” Diplomatic History 10 (1986): 363–372.CrossRefGoogle Scholar
Hooks, Gregory. “Guns and Butter, North and South: The Federal Contribution to Manufacturing Growth, 1940–1990.” In The Second Wave: Southern Industrialization from the 1940s to the 1970s, edited by Scranton, Phillip, 255–285. Athens: University of Georgia Press, 2001.Google Scholar
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Ingulstad, Mats. “National Security Business? The United States and the Creation of the Jamaican Bauxite Industry.” In Aluminum Ore: The Political Economy of the Global Bauxite Industry, edited by Gendron, Robin, Ingulstad, Mats, and Storli, Espen, 107–137. Vancouver: University of British Columbia Press, 2013.Google Scholar
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Lane, Christel. “Introduction: Theories and Issues in the Study of Trust.” In Trust Within and Between Organizations: Conceptual Issues and Empirical Applications, edited by Lane, Christel and Bachmann, Reinhard, 1–30. Oxford: Oxford University Press, 2000.Google Scholar
Larson, A. “Network Dyads in Entrepreneurial Settings: A Study of the Governance of Exchange Relationships.” Administrative Science Quarterly 37 (1992): 76–105.CrossRefGoogle Scholar
Lawton, Thomas C., McGuire, Steven, and Rajwani, Tazeeb. “Corporate Political Activity: A Literature Review and Research Agenda.” International Journal of Management Reviews 15 (2013): 86–105.CrossRefGoogle Scholar
Lipartito, Kenneth. “What Have Lawyers Done for American Business? The Case of Baker & Botts of Houston.” Business History Review 64 (1990): 489–526.CrossRefGoogle Scholar
Lipkowitz, Irving. “Conglomerates and Business Competition: An Introduction.” St. John’s Law Review 44 (1970): 42–44.Google Scholar
Maclean, Mairi, Harvey, Charles, Suddaby, Roy, and O’Gorman, Kevin. “Political Ideology and the Discursive Construction of the Multinational Hotel Industry.” Human Relations 71 (2018): 766–795.CrossRefGoogle Scholar
Martin, Peter. I Call on the Reynolds Brothers. Richmond, VA: Reynolds Metals Company, 1961.Google Scholar
McGrath, Conor. “Lester Milbrath’s The Washington Lobbyists, 50 Years On: An Enduring Legacy.” Political Studies Review 16 (2018): 217–229.CrossRefGoogle Scholar
Mellahi, Kamel, George Frynas, Jedrzej, Sun, Pei, and Siegel, Donald D.. “A Review of the Nonmarket Strategy Literature: Toward a Multi-Theoretical Integration.” Journal of Management 42 (2016): 143–173.CrossRefGoogle Scholar
Perchard, Andrew, MacKenzie, Niall G., Decker, Stephanie, and Favero, Giovanni. “Clio in the Business School: Historical Approaches in Strategy, International Business and Entrepreneurship.” Business History 59 (2017): 904–927.CrossRefGoogle Scholar
Portes, Alejandro. “Social Capital: Its Origins and Applications in Modern Sociology.” Annual Review of Sociology 24 (1998): 1–24.CrossRefGoogle Scholar
Reynolds, Richard S. Jr. “Opportunity in Crisis”: The Reynolds Metals Story. New York: The Newcomen Society, 1956.Google Scholar
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