The United States Shipbuilding Company was a short-lived trust made up of seven shipbuilding companies, a property owner and steel company. Its stocks and bonds were unattractive to investors, and several of its member shipyards were overvalued, conditions which brought down the company less than a year after it was formed in 1902. The company was replaced by the Bethlehem Steel Corporation in 1904.
At the turn of the 20th century, John Willard Young, a son of Mormon pioneer Brigham Young,[1][2] promoted the idea that many leading American shipbuilding companies should form one gigantic combination.[3] The United States Shipbuilding Company was the manifestation of that idea.[4]
Following this course, the enterprise's central designing office would apportion the shipbuilding work to the yard best suited to handle the project, therefore increasing competition with European shipyards.[5] Although American shipbuilding was not considered a highly profitable venture,[6] the political environment seemed right for improvement. President William McKinley and his new Vice President, Theodore Roosevelt, had endorsed federal subsidies for American shipbuilding industries, to compensate for the subsidies provided by European governments, but Congress had not yet approved such a measure.[7] A renowned naval architect and public servant, Lewis Nixon, was chosen to lead the venture, and helped attract several major shipyards to participate.[5]
Unfortunately, however, "the one thing [the consolidated firms] lacked, individually and collectively, was a realistic prospect of earning sustained profits."[4] Financially the corporation failed almost immediately. As one scholar would later write of this plan, "the theory was impossible; the condition was untenable; the trust, as it was manufactured, was impracticable; and the United States Shipbuilding Company was insolvent."[3]