When Brooklyn controlled the nation’s sugar

May 23, 2012 Brooklyn Eagle Staff

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By Martin L. Schneider

The famous New York Havemeyer family, generations of them, never did live in Brooklyn. But they liked doing business here just fine and also favored being buried here. There are about 20 of them laid to rest in beautiful Green-Wood Cemetery.

The business part of their Brooklyn connection began a few years before the Civil War and reached its apex under Henry Osborne Havemeyer in the early 1900s. Known today as the Domino buildings just north of the Williamsburg Bridge, they stand as a highly visible and landmarked reminder of America’s powerful industrial past.

The Brooklyn connection came about after the two founding Havemeyer brothers, William and Frederick C., made a huge success of the sugar business in Manhattan where they’d landed in 1802 having worked briefly at a cane sugar refinery in London.

The business acumen of the Havemeyers was widely admired and they and their descendants all prospered. Cousin Bill became mayor of the city three times. Fred, Jr., went to Columbia College, traveled in Europe and, upon return, had even bigger ideas for their business. That led him to the Brooklyn waterfront where he found “good deep water, plenty of labor, and…space to build.”

In 1858 the second-generation Havemeyer brothers opened what soon became the leading sugar refinery in the country. From the start it was designed as a sprawling enterprise producing more than all the existing Brooklyn refineries put together, but the operation was destined to become much bigger after an unexpected disaster.

On January 8, 1882, Fred, Jr. and his sons were called to Brooklyn from their Manhattan mansion because of an explosion and fire described by the Brooklyn Daily Eagle as “one of the most destructive and at the same time the grandest conflagrations’’ ever seen.

Yet, barely eighteen months after the fire, on July 30, 1883, the Eagle enthusiastically described the rebuilt Havemeyers and Elder establishment, as it was now known, as “the largest of the kind on the face of the globe.” Soon there were 650 ships a year tying up at the Havemeyer plant to deliver raw sugar. By then Brooklyn was the source of sugar for two-thirds of the nation as well as a prime source for customers around the world.

Sugar had become the commanding industry in the City of Brooklyn, representing 40 percent of the total value of Brooklyn’s manufactured products. But the Havemeyers wanted still more, and were intent on fulfilling the growing national appetite for sugar.

How the workers lived

During the most lucrative period for the Havemeyers, from 1890 to 1910, about 3,000 men were working in their Brooklyn refineries. It was unpleasant work, very hot and physically demanding. Working in a sugar-dust atmosphere can produce nasty skin and lung ailments and dust explosions were not uncommon.

The average weekly wage was $13, the lowest being $6 a week for boys and girls. A meal at a communally served restaurant would run 15 cents. A cold-water tenement flat, with three bedrooms, no outside windows, and a shared toilet out back, would cost a family man $8 a month or a little less than a week’s wages. The work force was a steady one with most workers staying on for eight or more years.

Job actions at the refinery were rare. Havemeyer fought off only two strikes. One, in 1906, was about raising the 18-cents-per-hour salary. The company won the fight despite that year’s profits which came in at a handsome $50 million.

Dealing with competition

With such high profits the business had attracted other refiners, posing an interesting business problem for the Havemeyers. They reasoned that with so much capital invested and so much profit to be made, they needed to be protected from what they viewed as unnecessary and disruptive price competition.

The New York Times, on October 11, 1887, revealed some inside information: “It is understood down town that a trust is about to be formed from a combination of leading sugar houses.” The formation of the Sugar Trust, with the Havemeyers in the lead, was underway.

The powerful trust proved a financial bonanza. It enabled the Havemeyers to control the price of refined sugar, affect the tariff on imported raw sugar, make rebate arrangements with favored customers, manipulate suppliers, conduct destructive price wars and generally run amok in the sugar business world.

Anti-Trust Act bypassed

In 1890 the Sherman Anti-Trust Act was passed to cope with the proliferation of such combinations. In response the Havemeyers created the American Sugar Refining Company, a new form of corporation that enabled them to maneuver around the loop-hole-filled anti-trust law. One result was that the Havemeyers enterprise ultimately ended up controlling an astonishing 98 percent of the sugar business in America.

An unexpected art bonanza

During the Gilded Age in the last years of the 19th century, Fred Jr.’s son Henry Osborne Havemeyer, who played the violin and eschewed the Newport fancy people, became interested in establishing the new Metropolitan Museum of Art as a world class home for the best art that money could buy. After his sudden death in 1907, his widow, Louisine Waldron Elder Havemeyer — aided by her old Philadelphia friend, prominent artist Mary Cassatt — continued working avidly to build one of the great private collections of art in America. Upon her death in 1929, the Metropolitan received what art historians consider “among the greatest [gifts] any museum has ever received,” with nearly 2,000 great paintings, sculptures and other prize objects coming their way.

A long slow fade-out

At the turn of the century Henry O. had put his Domino stamp on the public’s very idea of sugar by inventing the small sugar carton and making the domino-sized sugar cubes to go into them. His enormous personal fortune had been secured, but the Brooklyn business began a long, slow decline.

In 1920 it took 2,300 workers to produce three million pounds of sugar a day. By the 1980s the number of Brooklyn workers putting out four million pounds of sugar daily was reduced to a mere 240. Toward the end American Sugar Refining, Inc. was owned by the British company, Tate and Lyle, which began shifting operations to Baltimore. By 2002 some 190 people were working in the refining portion of the company and were let go first. About 60 others stayed on in the packaging department until the end came in 2004, when the doors were shut and Domino was finally closed.

The property was soon acquired by a major real estate developer seeking to convert the existing buildings to residential use with fabulous views of Manhattan across the way. In October 2006, New York State found the property met the criteria for inclusion in the National Register of Historic Places.

On September 25, 2007, New York City’s Landmark Preservation Commission designated three of the buildings as landmarks.

By spring of 2008 the preservation issue had shifted to an architectural and transformational one and the question being asked was: How can change be made to an 11-acre industrial site without damaging or perhaps even destroying its iconic value as a tangible reminder of our nation’s past? The new developers promised that the project “will balance the old and the new, preserving the best of the past to inform and grace the future.” The first steps to carrying out that pledge involved the distinguished team of adaptive-use specialists Beyer Blinder Belle and were then elaborated and developed by the internationally respected firm of Rafael Viñoly. Finally, in mid-2010 the Times reported that New York’s City Council had given its approval for a $1.5-billion, 2,200-unit, 11-acre project and that the project could “move forward after nearly six years of planning, debate, [and] hearings.”

Financing issues and conflict between partnes are currently dogging the ambitious riverside scheme, but it appears that before too long the mammoth ten-year project will be started. Eventually, it is expected that future generations in Brooklyn will be able to live happily with this potent reminder of who we have been and what was created by the enterprise, ingenuity and muscle power of the Americans who put it there.

Martin L. Schneider, a longtime Brooklyn Heights resident active in civic issues, is the author of “Battling for Brooklyn Heights”, the story of the neighborhood’s entanglements with Robert Moses over the latter’s “slum clearance” plans for parts of the Heights. An expanded version of the present article can be found in the Spring 2012 issue of NYarchives, the quarterly magazine of the Archives Partnership Trust.