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Employees of George Pullman, founder of Pullman Palace Car Company, were required to live in a city of his creation, pay him rent, and accept pay cuts and workloads without complaint.
Factory wages at Pullman's company dropped by 25% in 1893 due to a depression but rent in Pullman City did not lower accordingly. Any debt the workers accrued was taken out of their paychecks. In May of 1894 3000 workers went on a "wildcat" strike.
In June of 1894 members of the American Railroad Union, founded by Eugene V. Debs, refused to allow any train with a Pullman car to move unless it contained mail, as they had no wish to gain the attention of federal troops.
By June 29, 1894 50,000 members of the ARU had quit their jobs in response to an organization called the General Managers Association. Soon there was no movement of trains on the railroads to the west of Chicago.
At first the governor of Illinois was reluctant to request the presence of federal troops but on June 29, 1894 railroad workers on Blue Island became violent, destroying yards and burning anything they could. After this incident Attorney General Olney requested federal troops from President Cleveland to break up the strike.
Olney obtained an injunction declaring the strike illegal on July 2, 1894. Troops were sent to Chicago when workers did not return to their jobs the next day and the strikers quickly became violent. Many people were injured or killed in the aftermath. Debs was placed in jail and realized that the strike could not continue with the the troops present. Most workers resumed their old jobs at the same wages but some were blacklisted. Debs was placed in jail again for 6 months and when he was released the ARU no longer existed.
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