[TAPE 1, SIDE A]

HARRY WATSON:

This is an interview with Ceasar Cone by Harry Watson on January 7, 1983, in Mr. Cone's office in Greensboro, North Carolina. Let's start with a few questions about you personally, and then I'd like to move on to your experience in the company in the thirties, forties, and fifties. When were you born and where?

CAESAR CONE:

I was born on January 30, 1908, in the St. Andrew's Hotel in New York City. It was located on the northwest corner of Broadway and Seventy-second Street. The hotel was torn down, I guess, in the twenties or thirties.

HARRY WATSON:

How did you happen to be born there?

CAESAR CONE:

Well, that's where my mother was. [Laughter] My father spent a good deal of time in New York, but actually she went up there to give birth to me because she was from New York originally. My father met my mother when the old Cone Export and Commission Company was first organized and they started an office in New York about 1890. My father, of course, was not married at that time, but he met my mother and they were married in 1893, I think it was. Her old family doctor, of course, who took care of my grandparents' family, probably presided when she was born. She went up there to have all of us. My two older brothers, Herman and Ben, were both born in New York. Ben was born in the summertime. This doctor, who was getting along in years, had a summer place up in the Catskill Mountains, so my mother took a house up there that summer. He was born in August. Of course, children were all born in homes, not in hospitals, and so I was born in a hotel.

HARRY WATSON:

That's very interesting. Do you know how your parents met

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each other?

CAESAR CONE:

They met in New York. My mother lived to be ninety. She just died twenty years ago, in 1962. She was born in 1872. She and my father did considerable courting, I understand, at the World's Fair in Chicago in 1892 before they got married. I think they had met in New York before that. Both her parents and my father's parents took their families out to this World's Fair. That was the Columbian Exhibition.

HARRY WATSON:

Yes, that was in 1893, I believe.

CAESAR CONE:

Ninety-two or three.

HARRY WATSON:

When did you all move back to Greensboro?

CAESAR CONE:

They brought me down here after I was a week or so old. They moved to Greensboro in 1895, some thirteen years before I was born.

HARRY WATSON:

Where did you grow up in Greensboro?

CAESAR CONE:

I grew up in my parents' home on Summit Avenue. At that time, our place was outside the city limits. You see, my folks bought the defunct Carolina Steel and Iron Company, Several thousand acres northeast of Greensboro. That was organized, I think, around 1880 to make steel in Greensboro. Greensboro was going to be the southern Pittsburgh. But the company went bust, and when my folks decided to go into manufacturing they bought this big piece of property which was outside the city limits. They built the plant there, and they built their home there. We had a farm when I was growing up, and we had our own cows, made our own butter, and had our own chickens. But we didn't have any beef cattle, and we didn't have any hogs, but we had everything else. We had horses, of course; that was before tractors. We had a bunch of horses and had a silo. It was a regular farm.

HARRY WATSON:

Where did you go to school?

CAESAR CONE:

In Greensboro. I went to grammar school and high school for two years, and then I went out to Oak Ridge Military Academy for my last two years, and then the University of North Carolina, and then the Harvard Business School.

HARRY WATSON:

You're smiling about that. Why did you decide to go to Harvard?

CAESAR CONE:

I didn't decide.

HARRY WATSON:

Oh?

CAESAR CONE:

My father died when I was nine years old, but my older brothers and mother more or less decided where I should go to school. After all, I think that used to be the case. I don't know whether it is today or not. I guess children are more independent than they used to be, but you used to do what you were told to do.

HARRY WATSON:

Did they go to the Harvard Business School?

CAESAR CONE:

No. My oldest brother, who passed away in 1955—he was born in 1895, and he was sixty when he died—only went to the University of North Carolina for two years. He was in the Class of 1916, but he only went for two years. And my other brother, Ben, graduated in 1920. He was interviewed previously. He was in school with this famous Thomas Wolfe. I graduated in 1928 from the University.

HARRY WATSON:

What did you major in when you were in college?

CAESAR CONE:

I guess it was history.

HARRY WATSON:

Really?

CAESAR CONE:

I took a lot of courses in history. Maybe economics. I don't know. I think I probably had more courses in history and economics than anything.

HARRY WATSON:

Was business school much use to you?

CAESAR CONE:

Yes, I think it was very helpful. It taught me to realize that if you had ordinary intelligence it was worth more to you than brains, because some of the Phi Beta Kappa students up there had nervous breakdowns and committed suicide, whereas some of us that were not too smart in undergraduate school did a pretty good job up there at the business school because we weren't scared to make mistakes. In my experience up there at graduate school, where they had the case system, I found that the Phi Beta Kappa student who studied hard and learned right or wrong… Up there at the business school, there wasn't any right or wrong; it was your reasoning that counted. You could answer a question one way, and I could answer it another. The guy who had the best reasoning got the good grade. Those poor fellows were used to reading a book with the right answer and retaining it in their head and making Phi Beta Kappa, but they were scared to reason and come up with an answer because they couldn't find an answer in the library. They'd study in that library all day and all night. I roomed with a boy from the University from Raleigh—he's long been dead, a boy named Shepard—and he and I got through in pretty good shape. Because we decided how we were going to answer a problem, and then we'd go to the library and get some statistics to prove our point. And we'd go through in pretty good shape and not take too much time and worry too much about it. So from that standpoint, I think I got pretty good training up there.

HARRY WATSON:

How about the company's policy in years following? Have you preferred to recruit your executives from business schools or from

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within the company?

CAESAR CONE:

Mostly from within the company. You might say I got my job through nepotism; it was shot through with nepotism. Not just Cone family, but by the time I came along it was second generation, pretty much, and third generation all through the employees. In other words, a job with the Cone organization was a job for life and a job for your children if they wanted to go to work for you. We didn't do much recruiting. About my time, just before my oldest brother died—I'd say by the time we got listed on the New York Stock Exchange in 1951, and I was Treasurer at that time; he was President—we decided that since we'd become public, although the family owned about fifty percent of the company, that we couldn't afford to run it as we had theretofore for the company, the family, etcetera, and we'd better get out of nepotism. So we didn't have any revolution, but through evolution and attrition… My brother died, and I was made Chief Executive. My children didn't go into the company. My oldest brother's children were already in the company. But we put the sign up, "No More Nepotism," and over the years it's become pretty much professional management. We started recruiting, I'd say, about that time. Prior to that, it was pretty much the buddy system. A fellow who worked for us had a son, and he went to college, maybe, or to textile school, so he went to work for us when he got out. We didn't do any recruiting. It was a question of pretty much finding a job for most any employee's son. It was before the days of the females getting into the business. But the same thing was true as far as secretaries; it was the daughters of employees, etcetera.

HARRY WATSON:

Did that system work well?

CAESAR CONE:

I'd say no.

HARRY WATSON:

Why?

CAESAR CONE:

It probably worked well back before my time, but as government got involved, all kinds of legal problems, rights, etcetera, came along, and I'd say that that old system of nepotism was bad. It meant probably you were missing one or two real good people, but on the other hand you were upsetting a heck of a lot of people, and you were stuck with a lot of folks that weren't worth a damn.

HARRY WATSON:

Was it a hard decision to change the policy?

CAESAR CONE:

Not for me. We also instituted mandatory retirement at age sixty-five. Of course, we had put in a pension plan along the road which we didn't have in the beginning, of course; nobody else did. But mandatory retirement at age sixty-five was something that came along about my time. When I got sixty-five, I got out of there. I didn't want to. I think I could still be there. I'm seventy-five now. But I got out and got this office so that I've been up here ten years. Now some companies let their retired executives still have office space, etcetera, and I think that's bad.

HARRY WATSON:

Why do you think that's bad?

CAESAR CONE:

I'm afraid they get in the hair of the younger generation. Listen, if the younger people can't run things—I don't care whether it's a business or a college or a government—why, it's going down the drain. My only commercial job in business was with Cone, but I was active with our Airport Commission for many years in Greensboro; I was President of the Greensboro Chamber of Commerce; I was President for a

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while of the Moses Cone Hospital. Most everything I had anything to do with, when I see how it's run today, I'm upset.

HARRY WATSON:

Not as good, huh?

CAESAR CONE:

Well, it's not a question of not as good. They spend too much money on things.

HARRY WATSON:

Things?

CAESAR CONE:

I mean structures, buildings, and they borrow into the future. Spend more, and it'll be corrected. My feeling is that spending money is the last thing you ought to do. You want to be sure that your procedures are correct and that the goal that you're heading for is going to be met through procedures, and if you need to construct something to do that, okay. But it seems to me that today, even during this depression, that ever since Mr. Roosevelt the idea is throw more money at a project, whether it be a business project, a civic project, whatever, and all the future problems will be solved. The trouble is, we don't have that much money. We're loading the future generations to pay for it, plus the interest. In the old days, anybody that was fortunate enough to borrow money, whether it was a business or a civic need, a hospital or whatever, or as a home owner, he was so grateful, the first thing he wanted to do was tear up the mortgage, pay it back. Today it's a case of going out and borrowing, borrowing. The government makes it easy with guarantees in certain areas. Paying this kind of price for money the last few years is ridiculous. And to slow this thing down, why, we've got to decide that we're going to take it easy. For instance, look at the subways in New York. They were built at a time when we didn't have any inflation, and the people today have the benefit of

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those subways, that today would cost billions to build. Nobody realizes that. But think of the people a few years down the road. Those subways now and our roads are going to pot, and we're going to have to go to work now and borrow millions and millions and millions more just to maintain them. That's what inflation has done to us. And inflation has come about because we want more right now than we can afford, and so we figure, well, let the other guy down the road, the next generation, pay for it. That wasn't the way this country was built.

HARRY WATSON:

Fair enough. It sounds to me that Cone Mills wasn't run that way, either, for years.

CAESAR CONE:

That's right, very conservatively. Cone Mills borrowed $600,000 in 1905 to build a plant, and at that time the bank lent them the money and put restrictions in the loan that they couldn't pay dividends till the loan was paid off. And the president of the bank was on the board of the company until the loan was paid off. And that was a $600,000 loan. That's the way business was in the old days, and the company was most grateful to be able to borrow $600,000.

HARRY WATSON:

What was the bank?

CAESAR CONE:

It was a bank in Baltimore.

HARRY WATSON:

From what you said, it doesn't sound to me as if you had a hard time making up your mind to go to work for the family business, that it was pretty much laid out for you. Is that right?

CAESAR CONE:

That's right interesting. I did have, kind of, personally, a question. My second year up at the Business School was right when the Crash had come. The Crash came in the fall of 1929, and

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I graduated up there in June of '30. The Business School was about the first graduate school of business in the country, you know, and most of the rest of them came along after that. You put in for appointments to meet with recruiters who were coming up there. I wrote down here, and my brothers said, "No, you don't want any appointments. We're expecting you to go to work in the company." And I wrote back and said I would much rather kind of go it on my own. Most of the recruiters up there were coming from commercial banks or investment banks, mostly banking. Very few manufacturers were recruiting. Some of the retail chains were beginning to, Sears, Roebuck, Montgomery Ward. But I figured I'd go to work and have a few appointments and take a job. Oh, they were insistent that I not do that, that I go to work for the company, so I didn't have any interviews. And the company said to me they wanted me to go to New York, which was the main merchandising office, which I did, not too happy living in a big city after having been able to play golf after work and that kind of stuff. I moved into New York with a couple of boys from the South that were bachelors, as was I. People didn't get married then until you got a job that you knew you could support a wife. Today they get married even before they get out of high school, almost. The first job was to be a credit runner in the credit department, which meant going to the various banks and factoring companies to check up on customers for the credit files. After several months there, they gave me some training in the various fabrics. I had worked in the mills, incidentally, in my summer vacation between college terms, so I knew a little bit about—not the details of textile school stuff—but weaving and spinning, ectcetera.

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I was a cub salesman there in the New York market for about a year, calling on people that we didn't do business with, trying to bring in new customers. Well, with a New York sales force of about ten people, why, it was pretty tough for me to find new customers that had credit unknown. But anyway, I was finally given the New York State and Pennsylvania territory. I made my headquarters in the New York office but travelled New York State and Pennsylvania. I didn't have any customers in the City, of course, or in Philadelphia—we had an office—but out to Pittsburgh and up to Buffalo, etcetera. I was there until 1933, at which time our salesman that travelled Ohio, Indiana, and Michigan left us and went with another company. I was single and easily mobile, so, with one pitch around my territory with a new cub salesman, I went out to Chicago. I made my headquarters in the Chicago office. We had four men there: one for the city of Chicago; one travelled south through Illinois and Iowa; one travelled north, Wisconsin and Minneapolis; and the other one was my territory, Indiana, Ohio, and Michigan, kind of east of Chicago. I was there until the man who did the city-of-Chicago job had a liquor problem, and he got fired. They asked me to take over Chicago, which meant Sears, Roebuck, which was a big account by that time, and several big garment manufacturers were headquartered in Chicago. A pretty good market. I was in Chicago, looking after that market, until I got sick. In 1936 I got tuberculosis. That was before they had streptomycin and these drugs, and they put you flat on your back and hoped you could resist it. Maybe you could, and maybe you couldn't. Well, I fought that thing in Chicago there in the hospital from the middle of '36 until

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about the end of '36. I went out to Arizona for a year and finally got back on my feet and came back to Greensboro then and decided the hell with it, I wasn't going to travel anymore. That was a little bit too rough. I might get another breakdown. I had had pretty much training up there at the Business School on finances, and we didn't have anybody that was too hep on that, so they made a job for me—I say "made"—here in Greensboro. I moved back with my mother and later got married to a Greensboro girl in late '38. In the meantime, I guess you'd say that I kind of was Daddy Rabbit on putting all these different companies together, consolidating these various individual corporations and the selling corporation with the manufacturing company. That was in '45. I was in Washington during the War with the Quartermaster General, but after the War we got this consolidation together. In 1951 we sold 400,000 shares of our stock, not the company, but individuals. My two brothers and I each sold 100,000, and the Moses Cone Hospital sold 100,000. Moses Cone Hospital owned about a third of the company at that time, because my father's oldest brother, Moses, and my father started this thing. Moses had no children, and he died without a will in 1908. So under the laws of intestacy, his wife inherited half of his personal property, which was stocks in these various mill companies. So she set up this hospital, retaining her interest in her husband's estate for life; then would be the hospital. She didn't die until 1947, so the hospital didn't have any funds to build and to get in business. But the hospital owned about a third of the company, and when she died it sold some of its stock to provide some money to build the first plant. That was the necessary stock that the stock exchange required to have in

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the hands of the so-called "public" so it would be a tradeable item. As long as it was held by just a few people, it wouldn't qualify. So with those 400,000 shares of stock in the hands of the so-called "public," we acquired about two or three thousand stockholders in connection with that distribution, that sale. We already had some 2,000 stockholders, so it gave us about 4,000 stockholders with some 400,000 or 500,000 shares in the hands of the so-called "public." That was in 1951.

HARRY WATSON:

I wonder if we could get back to that in a minute, and go back to when you were just starting with the company. What were the general problems of the textile industry in the late twenties and early thirties?

CAESAR CONE:

I touched on it in this previous recording. The textile industry in this country—it's true with most industries—started off… And it was that way in South America. I took a trip down to Brazil and Argentina just after the War. We had an opportunity to go in business down there, and I went down there to look around. We found that the structure down there was about like I guess it was in this country back in the middle nineteenth century. The mills would sell their product to big wholesalers. The big wholesalers would sell the product to small wholesalers. The small wholesalers would sell the product then to the retail stores. Practically all the fabric was home-sewn. There was very little needle industry, and there were no chain stores. Sears, Roebuck was just beginning to think about expanding into South America. This was right after the War. Back in the old days in this country, the same thing was true. The manufacturers sold to a handful of big wholesalers. There were several tiers between the manufacturer and the

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consumer.

[TAPE 1, SIDE B]

CAESAR CONE:

In fact, I know there were attempts on the part of the independent merchants to try to get state laws passed against chain stores, food chains, general merchandise chains, because they were afraid it would put the individual retailer out of business. And it did, because those chains got to the point where they could buy in quantities big enough so they'd go direct to the manufacturer and thereby save the cost of the middleman. When I first went on the road, we had a good many large dry goods jobbers still in business, but there are no such anymore; they're gone. In those days, we wouldn't have thought about selling to retail, even to Sears, Roebuck. We wouldn't sell to a cutter, the needle trade. Even though maybe that cutter would buy in sufficient quantities, we'd sell to jobbers, and the jobber sold to the cutter the cloth he needed. A good many of the jobbers made their own garments, had their own few sewing machines to make overalls, work shirts, staple types of garments. About the time I got on the road in the thirties, those dry goods jobbers were just beginning to quit. There were several of them in Pittsburgh, several of them in Buffalo, Utica, Syracuse. Every town had at least one or two dry goods jobbers. They finally got whittled down to where about the only business they could still do was in consumer items, not in piece goods. As a matter of fact, the piece goods business in this country, pretty much, for staple stuff went to pot, because you could buy an overall or work shirt,

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a standard type of garment, much cheaper than you could buy the fabric at some retail store and the findings—the buttons, the thread, etc.— and make it yourself. That was not true in South America, you see. South America hadn't progressed to the point where we had, distribution-wise. But the wholesale jobbers went out of business. As a matter of fact, I doubt if Cone Mills today has as many customers on its books as it had… It's been ten years since I've seen any figures, but ten years ago we didn't, and I guess we've even got less today. You've got your Blue Bells here, the Wrangler brand, headquartered here in Greensboro, whose sales are over a billion dollars. You've got Levi-Strauss and Company out in San Francisco, whose sales are over two billion, I guess. That was unheard of when I first got into the business, even. I guess Blue Bell and Levi were big in those days, because they've been in business for some years, but I doubt if Levi's sales were over twenty to thirty million dollars. Five to ten million dollars, maybe. As a matter of fact, I called on Levi. When I was in Chicago, our salesman that ran the San Francisco office had a heart attack, and they sent me out there while he recuperated for some six or eight weeks. They had a few plants, but there were garment manufacturers all over the country making overalls, work shirts, staple stuff like that, you see. Anywhere from twenty-five sewing machines up to maybe a hundred or so was a pretty good-sized operation. Today I guess Blue Bell's got many thousands of sewing machines; so does Levi. And as they got bigger, a lot of our little customers went down the drain. Business has gotten terribly consolidated, and

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as a result, in my judgment, not just textiles, it makes our economy much more volatile. I mean the peaks and the valleys. If you have your business done by a great many small customers, you don't give a damn whether you lose one fellow's business or not. It doesn't affect you, the manufacturer. Where you've got these big customers, you can't afford to lose the guy's business, so he can beat you over the head. On the other hand, if things get tough and that one big fellow goes to pot, you see what it does to the over-all economy. As long as our economic activity was spread out—manufacturing, distribution, whatever—among many small operations, in my opinion it made the over-all economy much less volatile. Today, you see, a steel company closes a mill, or an automobile company, a textile company, and several hundred workers are put out. Several thousand, maybe. Chrysler Company goes bust; the government comes along and says, "We can't afford to let you go bust." Nothing like that was ever necessary back in the old days when our institutions were smaller.

HARRY WATSON:

Looking back over business history, it seems to me that the textile industry has been later to consolidate and has done less of it than petroleum, automobiles, steel, some of your other industries.

CAESAR CONE:

You've got several problems. Number one, the textile industry started off as kind of a homegrown thing—the hand loom, the spinning wheel—before technology ever came along with working with steel or things like that. You had the village blacksmith. The village blacksmith got out of the blacksmith shop and got into the steel industry. The textile industry came from the home spinning wheel and the hand loom. First we went through the water power days, before there was electric

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power or steam power. It was an old industry when all these other new industries came off the drawing board. That's one reason it didn't flourish in the South until we had electric power or steam power. Our rivers were small, and they didn't produce the water power. The old mills used to be run just like the grist mill. They'd have a dam, and they'd have a flume, and they'd have water power, and they'd have a wheel. The whole plant ran from that wheel through belts and pulleys. Electric power came along, and you could have individual motors on your machines. You could transmit your power by wires, and we got rid of all the belts and the pulleys. New England had big streams, big snows, big runoffs, and they could use water power and have bigger mills. That's one reason the mills in the South were just more or less glorified grist mills in the beginning, until Mr. Duke came along. First it was water power, which he transferred into electricity and transmitted by wire, and then steam power, which could be transmitted also by wire after you converted it into electricity. But the textile industry, frankly, didn't lend itself to the type of technology that you see in the steel industry, this assembly line kind of a thing. It still doesn't. It takes an individual machine to weave. Spinning has been improved to some extent, what they call open-end spinning. But it's still the same old process of taking individual fibers and combing them out in the same direction and then twisting them. That's making thread. Then you take those threads and you put them on a loom, your warp threads lengthwise and your cross threads, what we call the filling, in and out. It's the same old process as the hand loom and the hand spinning frame. It doesn't lend itself to the type of automation

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where you can roll out stuff. One thing that concerns us, that's killed us to some extent, but we don't know what to do about it, is the paper industry. There never used to be paper towels; textiles had all of the towel business. It had all the diaper business. There are various areas where other industries can pour stuff out. They can beat us to death. Economically, though, there's nothing we can do about it. We've got a more absorbent fabric, but it's a lot more expensive. Now, with services going up so, it's cheaper to have a disposable item than it is to have a diaper, we'll say, that you send off somewhere to have washed. It's not sensible economically to say that disposable items are cheaper than items that you can use and re-use, but it's true in this society of ours in this country. It costs so damn much to have things fixed. You take a suit of clothes at the cleaner, what it costs you.

HARRY WATSON:

Yes, I know. I just picked up some dry cleaning this morning.

CAESAR CONE:

I had an interesting example, talking about textiles. I was on the board for years out here at our airport. When we built a new terminal building in 1957—of course, they got a new one as of 1983—we put in these hand dryers in the rest rooms. Nobody can argue that the hand dryer doesn't do a very good job of drying your hands. Prior to then, years ago, we had the cloth that you pulled down. Then it came to paper towels. Stark Dillard, who's dead now, Dillard Paper Company, used to sell us a bunch of paper towels for the old airport terminal building. When they went to these blowers, he went out there to see this new building, beautiful, and went in there. He just raised hell. He said, "Hot air." And I said, "Stark, I agree with you. Evaporation is the lousiest way in the world to dry

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your hands. But on the other hand, just think. When you got the paper towel business away from the textile business, a paper towel's not as nice to dry your hands on as that cloth that we had out there, but it was more economic. I agree with you, but we've got a captive audience that goes into that rest room, and it's a lot cheaper for us to have this dryer, because those paper towels used to clog up the toilets and mess up, and we'd have to dispose of them." [Laughter] But that's progress, I guess.

HARRY WATSON:

Maybe so.

CAESAR CONE:

But there was a vast amount of textiles, worldwide, that went down the drain when the paper industry developed. Kotex. When I first came along, the whole women's sanitary business was textiles. That was taken over by the paper business, a hundred percent.

HARRY WATSON:

Were there other problems in the twenties and thirties? Some of the business histories refer to a situation of over-capacity in the nineteen-twenties. Your uncle, I believe, Bernard Cone, gave an address in 1930 to the Business School at Chapel Hill about problems of excess production.

CAESAR CONE:

The problem was this, what I just talked about. When a plant that was making diaper cloth had its market going away, it got onto something that was still going, percales or whatever which were going into dresses or garments or sheets or pillow cases. It hasn't happened yet, but I predict that one of these days the textile industry is going to lose one hell of a lot of product from the institutional sheet and pillow case business. They've already lost a lot of it from

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these gowns. In the operating room now they have a lot of these paper gowns that are disposable, instead of the cloth gowns in the hospitals. I don't think lying on a paper sheet will be as nice as a textile sheet, but in a hotel where you've got to wash them every day… The deterioration comes from the washing, not from the use. I can see where one of these days the paper industry's going to come along with a poured-out, soft piece of paper that might tear, by gosh, if you're rough with it, but they'll throw it away. As the looms and the spinning frames that are devoted to making fabric that goes into sheets and pillow cases, especially for institutions… Not for your home, where you maybe sleep on a sheet for a week before you send it to the laundry. And you only wash it once a week, so it doesn't deteriorate. It'll last a lot longer. But these institutional uses, where they have to wash it after every use, every day… They don't know whether the fellow's going to stay there overnight or not. So I can see, when that time comes, little by little, the textile industry's going to be overproduced. The guy making the sheets is going to go to maybe the denims, or whatever. Constantly, as I see it during my experience, we've been shot at because we've got an expensive way of making a flat surface, taking those individual little fibers, elongating them, twisting them, then weaving them. It's much more expensive than a poured product, plastic or paper, and everybody's going to shoot at us. There's only one area, in my opinion, that we've got a bisque, and that is this breathing business for clothing. You cannot have clothing that doesn't breathe. You'll suffocate, perspiration, etcetera. So that's the one area that's going to be the last to be penetrated by other industries,

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if ever. But in the processes, the thing is they kill our other markets. It's tough on us.

HARRY WATSON:

Looking at that problem historically, how did the Cone Corporation deal with that problem in the Depression in the late twenties? I should think that would have been something you all had to think very seriously about.

CAESAR CONE:

This Revolution plant, a lot of that flannel went into diapers and babies' sleepwear. It was soft flannel. We lost the diapers, but we didn't lose the sleepwear until flammability came along and the government said that this nap that makes it nice and fluffy and soft for a kid is too flammable. The first flammability law came along about twenty years ago. So the chemical industry gave us a chemical to put in there that would make this fabric meet the flammability test. Two years later the government came along and said this chemical is cancer-producing, so we've shut the mill down. It's sitting out there now. You want to buy it?

HARRY WATSON:

Not today.

CAESAR CONE:

Government interference has come along in the last few years and played hell with us. Where it goes from here, I don't know. They're now talking about that formaldehyde is cancer-producing. How you're going to finish cloth without formaldehyde, I don't know. Maybe they've developed something else. But formaldehyde is all over the finishing business in textiles. Always has been. I don't know where we're going to get to with the government interfering. I hope somebody finds the cause and treatment of cancer, because in the meantime they're going to blame it on everything.

HARRY WATSON:

You worked in the government during the War.

CAESAR CONE:

I was up with the Quartermaster General's Office in the Textile Section. Frankly, I didn't do a damn thing, but they asked me to go up there. I was mixed up a little bit with dealing with the chemical warfare. They were impregnating a lot of the uniforms to make them gas-protective and ruining the damn things. Wouldn't tell you the formula—that was a hush-hush secret—so you could determine how you could maybe treat textile fibers to keep them from the degradation that was caused by this formula. A lot of problems. I don't think I'd better put it on here. I could tell you when you shut this thing off. A right cute problem we had with the Wacs' uniforms. [Interruption]

HARRY WATSON:

Beginning after the War, you said that you began to work on consolidating various mills. How did you decide to do it, and how did you go about it?

CAESAR CONE:

I can tell you a little detail. Cone Export and Commission Company was the sales organization, a separate corporation owned pretty much by the family. It represented not only our own mills but outside mills. It for some time had represented particularly the Appleton Company, which was originally a New England operation, and had built a mill down in Anderson, South Carolina. It later became part of J. P. Stevens. Cone Company represented Appleton, sold their product. The corporate headquarters was in Massachusetts. The president or chairman of the board was a lawyer in New York. Most of the stockholders were up east. They used to have their annual meeting in the Cone Export and Commission Company headquarters there in New York. Very close to them. We sold for them on a commission basis only. They decided they wanted

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to get under the wing of a larger corporation. They had about four or five hundred stockholders, I think. We had nothing to trade. They wanted it tax-free, swap stock for stock. We had no stock to swap. The Cone Export and Commission Company stock had a book value of some five or six hundred dollars. The Proximity Manufacturing Company, which were the denim mills here, had a book value of about $10,000. There were only two thousand shares outstanding. The original 1895 [stock] had never been split or anything. No reason to. So we had nothing to swap with these folks. So, actually, Lowenstein tried to bid for it, I think Burlington did, Stevens. They were all listed on the exchange with the stock selling anywhere from maybe twenty to fifty: small value, many units. So Mr. Nichols, who was president of the company, I remember very definitely, said, "I'm sorry. We love you. You've made us; you've sold for us. We wished you'd be able to merge with us, so we'd have stock in your company and you'd have our operation, but there's no way." That was the thing that got us going. We decided to make the manufacturing company the parent; we split the stock a hundred for one and got all these separate manufacturing companies into the thing, swapping stock for stock. Then in 1948 we split it three-for-one again. In other words, the original stock was split 300 for one to give it a book value of around thirty. Then when we listed on the exchange some three years later, in 1951, we went along from there and we split it again in 1976, two for one. It was thirty years before we split it again. But the present stock has been split 600 for one from the original 1895 capitalization of $200,000. It took $200,000 of capital to build the first mill, of which the Duke family put up ten percent.

HARRY WATSON:

In setting up the Cone Mills Corporation, was the Cone Export and Commission Company included in the new corporation?

CAESAR CONE:

Yes, that was merged in. The sales organization was made part of the whole. When I first came down here and got into this thing, I found that Cone Export and Commission Company had been right much run as a family bank. The officers were not paid salaries. The stockholders were not paid dividends. They were credited with their salary each month. They were credited with their dividend each quarter. And they were paid six percent interest on any credit balance with the company. As they needed money, they called on the company: send me a thousand dollars, ten thousand, or whatever, and put it in this bank or that bank in my personal checking account or whatever. That not only was the family, but the family had some of its retainers paid that way. Charge my account, and credit her account. Several of my uncles had white housekeepers. One was a Scotch lady that lived with the Clarence Cones; one was a German lady that lived with the Bernard Cones. It was charge my account so much this month, and credit her account. Gretchen or whatever her name was. So Gretchen had an account there, and she got six percent on it. They handled their mills that way. When the mills shipped goods to a customer, the bill was from the Cone Export and Commission Company. The mill was credited on the Cone Export and Commission Company books. If the customer paid or didn't pay, it was up to the Cone Export and Commission Company to absorb whatever loss it was, bad debt. The minute the goods were shipped, though, the mill corporation had a credit balance on the books. In other words, the Cone Export and Commission Company was a sales agency

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and a bank, really. I got rid of all that stuff. I say I got rid of it. My brothers had been sitting down here, letting that thing go ahead for years. [Laughter] But I think if we're going to get consolidated and get listed, we'd better get rid of all that kind of crap, which we did. Oh, there were a lot of things. We got rid of a lot of paternalism. We owned all the houses that the employees lived in, and the rent, which was very minor, paid for the lights, the water, and the sewage. It was all outside the city limits in the beginning. This was true of all textile operations. They were all of them, in years before, on water power, streams, out in the country somewhere. The owner had a little commissary or store, and he had houses for the help. Everything, you see, had to be within walking distance, because it was shoe leather or horseback.

[TAPE 2, SIDE A]

CAESAR CONE:

I don't think much of Mr. [Ralph] Nader. He's criticized the automobile for killing people and messing up the countryside with all these roads, etc. I think the automobile has damaged our society more than anything it could possibly do physically. As an example, my father had the biggest house in town and was the richest man in town. He lived right next to his mill, so he could walk to work. And he lived right next to his mill houses, so his employees could walk to work. They had a store, and they had their churches, and they had the schools withink walking distance. As the automobile came along and made people more mobile and they could live twenty miles away and commute,

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it gave an opportunity to the individual to process his baser instincts, if you please. "I only want to live next to rich people in big houses, and I don't want to live next to smoke or noise where there's manufacturing, and I don't want to live next to a school where there's a lot of hollering at recess time," etcetera, etcetera. So zoning came along, and planning came along, and government came along with all this mix. As a result, it has created some of the problems, probably more problems than it's solved. I'm talking about society-wise.

HARRY WATSON:

How about with your own organization, in terms of the traditional relationship with the mill village and the houses?

CAESAR CONE:

We've gotten out of all that.

HARRY WATSON:

What made you decide to do that, and when did you do it?

CAESAR CONE:

I'd say we started on that about 1950. You see, they took us into the city limits in 1923. But the tax rate was less out there than in the city, in that district, because it didn't apply to the bonds, the debt service, as of the time of the take-in in 1923. Also, the company still ran the village system, keeping the streets up, the sewage, the water, etcetera. There were no water meters on the houses, no electric meters. In the fifties we turned the electric system over to Duke. We turned the water system over to the city, put water meters in the houses, electric meters. Originally, when the houses were built, there was maybe a forty-watt bulb in each of the four rooms, maybe, period. And it didn't cost a hell of a lot to absorb that juice when you figured the juice that was being used in the plants and all. But then as electrical appliances came along and people wanted irons and stoves and bought all these items, it was

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patently unfair. So rather than get mixed up with our employees on how much we'll charge you for an iron or a stove, we just decided to abolish the whole smear. We'll put meters in here, and the heck with it. In the meantime, pressures came from unions for salaries, more money, more money, so we decided the heck with it. It looks like we're going to have to give it to them in the payroll. So the heck with it, we'd just get out of it as far as this paternalism is concerned. You see, we had YMCA's that we financed. We gave them to the city as recreation. Before my time, when we ran the schools out there, we had a nine-month school for those kids, hired the schoolteachers and all, when the county school system was only a four- or five-month system. That was true not just with us but with the whole textile industry. In those days, when you needed a concentration of employees to run your plant, you were on your own. There wasn't any government housing or city housing or whatever. You had to build the houses and invite the people, and maybe they weren't too nice. In the beginning we had outhouses, before my time, and there was a drilled well with a pump between every two houses. That was better than they had up in the mountains or out in the country where they came from, and they were flocking in there. They had the school for the kids, which they didn't have where they came from. The amenities you gave them today would look like nothing and would be criticized by everybody, but it was so damn much better than people had where they came from that they flocked into these mill villages. Then "paternalism" got to be a dirty word. Now it's government paternalism, which is wonderful. Individual paternalism, corporate paternalism became a dirty word, don't you see.

HARRY WATSON:

I see.

CAESAR CONE:

That's one of your problems down here in Cannon Mills. They still have an unincorporated Kannapolis, and I see this new owner, Murdoch, who bought the place out, is getting ready to have Kannapolis incorporated. I don't know, but I suppose Cannon doesn't have its village houses with water meters and electric meters and all like that, so they're way late in getting into this thing. This equality thing came along, and all we wanted to do was run our plants; we didn't want to get mixed up in having the problems out in the community of putting a black and a white together or next door to each other and creating a big problem. We were smart enough to get out before all this equality hit. We had one plant that we weren't out of. It still had a village after equality. We had to tear the whole damn thing down.

HARRY WATSON:

Where was that?

CAESAR CONE:

Down in Rutherford County, Cliffside. It was out in the country, on the Broad River. The mill was a small mill in the beginning, run by water power. The Haynes family. Not the Winston Hanes. Cone Export had sold for that mill. They made plaids for years, and we enlarged it. Plaids went out of business. We turned it into a towel mill like Cannon. Very much smaller, of course. It now makes denim. But it was way out in the country, and we had our own village. But we were a little late in getting the village sold, and we had some blacks over here and whites over here, the same type of housing but in different areas. We came along to find that we couldn't offer the house to the man who'd lived in it with his family for thirty or forty

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years. You'd have to offer so many of these blacks over here opportunities for these houses, so many whites over here. We just figured that would just create merry knob with us, we, the owners, being accused. Nothing we could do about it, so we tore the whole damn thing down. In the meantime, automobiles have come along, so they can commute there from out in the country to wherever they might go to live. It's not far from Rutherfordton, Shelby, and down that part of the country. That was the only place we ran into that, because we'd gotten rid of everything else. Now what they're going to run into down there at Kannapolis, God only knows.

HARRY WATSON:

It sounds like it could be pretty complicated.

CAESAR CONE:

We fixed all the village up before we sold it. We gave them easy terms and financed it ourselves instead of selling out wholesale to somebody and then let the moneychangers take over. I think it was at four percent interest. They've got them all paid for now. This was 1950-odd. We made the loans dependent on the size of the house. If a fellow had a four-room house, we figured he ought to pay it off in ten or twelve years. If he was in a two-storey house with eight rooms or six rooms, maybe it was fifteen years. In other words, pattern the thing. But that's all out of the way. We're out of the municipal business.

HARRY WATSON:

You mentioned unions a while back. What's been your experience with unions over the years?

CAESAR CONE:

The only personal experience I've had with them is, we had a strike some years ago. It was economic as far as the union was concerned. It was the check-off. We didn't give them the check-off.

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They called a strike, which was unsuccessful. The big majority of our people, I think, went through the gates and kept the mills running. But they had a picket line, and some of your folks from down at Chapel Hill came out there and wanted to see what they could do. Political Science Department. What the heck was his name? It was all over in a few months. I guess it wasn't that long. But it was nasty; we had to have the police out there to protect the gates. See, if the union calls a successful strike and shuts you down, you have no trouble. But if you try to run for those that want to work or the non-union, then you have your trouble. It's a most unfair situation, in my opinion. You have to be real careful, or otherwise you get charged for an unfair labor practice if you try to run your plant for the benefit of those who want to work.

HARRY WATSON:

This strike was in the 1960's, I guess?

CAESAR CONE:

Oh, it was before that, I guess. I guess it was in the fifties, the last time we had any real trouble. Of course, where you have a union, you constantly have to bargain whatever you do, wage raises or any changes in anything. But the textile union has had its problems, because they realize that they've got a very weak industry. Management doesn't make the wages that other managements make; labor doesn't make the kind of wages; the stockholders don't get the kind of return. I'm talking about in industry in general. The unions recognize that, and they're smart. They go where the money is. They go to the steel and the automobile and the electrical and that kind of industry. After the War, those industries were able to sell their product for anything and didn't want to stand a strike and

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gave the unions everything they wanted. They got into the hands of the unions to the extent they couldn't get out. The textile industry was not in that situation. I don't know how they set out there now, but we never gave them the check-off, based on the fact that at one time they had two textile unions, the United Textile Workers and the Textile Workers' Union of America. They always had this inter-union strife. At one time we had the TWUA. We were giving them the check-off. The UTW came in. They had a big fight. A fellow, Baldanzi, was one of them. I remember that name. The UTW took over. Then they had a squabble: who owns the local treasury? So we just quit checking off when this new crowd came in. We said, "You all can decide who owns what. We're not going to check off from our people." I don't know how that was settled. Finally, TWUA came in again after a few years. Since then, we haven't given the check-off. The last of my knowledge, up at Danville they still have the United Textile Workers. I don't know just what's what. Of course, the check-off is the life-blood for unions. No expense of collection, a big pot every week. If they have to go punch doorbells for union dues, it costs them damn near as much to pay the guy who's going around soliciting the dues as they're going to get. They say money's at the root of all evils; I agree. They've never been too strong in the South. I think Stevens made a bad mistake. We never fought the unions. We tried to be realistic. Back during my day, ten years ago—I don't know how it is now—out of our about twenty-two plants, I think the unions had contracts in about five or six.

HARRY WATSON:

Where were those?

CAESAR CONE:

They had it in the White Oak Mill here in Greensboro, the Proximity Mill in Greensboro. The Proximity Mill has been closed. The print works here in Greensboro; that's been closed. White Oak is still going. So two of the three union mills here in Greensboro are down. They got a contract down in Haw River. That mill's still operating, although I think they were thinking about closing it. And the finishing plant in Haw River has a union. It did, and I guess it still has. We never had a decertification election. Probably there are fewer union members than there are non-union members on this dues-paying thing. But we've never tried it, because we think that once you ask for a decertification election, you run into a real stir-up. It's not as easy to run a plant that's got a union as it is to run one that doesn't have, no question about it. We had a merger with a plant down in Gadsden, Alabama, in 1951, and we finally closed it up about 1960. We couldn't run it. We thought we knew something about dealing with unions, but the union down there was an entirely different breed of pup. The same union, TWA, but Gadsden, Alabama, had three big employers: Cone Mills (this Dwight Manufacturing), Goodyear Tire and Rubber, and Republic Steel, both of them highly unionized. Not just the companies, but the steel industry and the rubber industry did industry-wide bargaining. They'd call a strike periodically, when they weren't getting together with Akron or Pittsburgh or wherever. Then they'd all go back to work after a month's strike, with higher wages, etc. The whole town was unionized, the clerks in the stores, etcetera. We had the Textile Workers' Union, and they felt like they were just as strong as these others. Well, they

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weren't, and I went down there and told them. We'd had problems just changing the product mix, you see. "We're not supposed to work on this and that." I mean, it was just every little detail, just terrible. I won't go into the details, except that we just finally decided we'd close the thing, and we did. Twenty-two hundred people with jobs lost. We were losing money on the thing. We just couldn't run it. I was Chief Executive by that time; my older brother was dead. And I told them down there when I went down and talked to them before we closed, "Look, I don't fault you folks in this community for thinking that you can get out of us what your friends across the street are getting out of steel and rubber. But textiles are different. Every time you go out, our competitors are taking our customers away from us. When the daggone steel folks go out or rubber goes out, there ain't any rubber or steel made in this country because it's industry-wide bargaining. And all it's done is, they're eating on the inventories, making businsss better when you crank up again. When we crank up again, we've lost our daggone markets." Well, they didn't pay any attention to that. I guess the head-knockers of the union realize that, but the individuals aren't. And they're not going to admit it to the individuals, because if they said to the individual, "Go ahead with Cone management," the individuals down the line would kick out the management of the unions. They've got to go along with the workers.

HARRY WATSON:

What would be the effect if there was industry-wide unionization in textiles?

CAESAR CONE:

You'd have the same problem you've got with steel and automobiles. You'd have things pushed to the point where we'd all be

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out of business, and Japan would be taking the whole thing over. As low as textile wages are, we're still in a hell of a fix from all this import stuff. And we're way low, compared to what you see up here in automobiles and steel. Why the hell should those folks make twenty-five or thirty dollars an hour, with fringes, and our folks make only about eight or nine with fringes? How they expect to sell automobiles to the eight- or nine-dollar-an-hour guy, and they're going to get twenty-odd dollars themselves, and that's what you've got in this country. The places where the union has pushed the hardest and management went along because they could sell anything at any price right after the War has just screwed up the so-called marketplace idea. And the same thing's true with capital. You don't make the return on capital in textiles you were making. Now we're still going along, and they're trying to get concessions, getting back off this damn high plateau. And it's creating a hell of a problem with the unions, because the unions don't want to go to the folks and say, "Look, you were getting too damn much. You'd better be willing to work at a hell of a lot less." But the problem is, those folks now, "We'll either get twenty dollars, or we won't work at all." I don't know. I'm rather bearish on where we go from here. The whole setup is… Government has gotten into the economy, the society, to an extent where in a democracy it's most difficult. Now a communistic setup, I don't care whether it's a dictatorship of the right or a dictatorship of the left… To me, it's necessary to at least have a line of command and responsibility on the part of people to take orders from people. I mean we've gotten to the point now, every time an employer hires

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anybody, he's subject to a lawsuit. You don't know where you are. Government can't tell you. We're a democracy. You go to the labor department and say, "I want to hire ten people." How many blacks, how many whites, how many young, how many old, how many lame, how many female. To keep from being in trouble. And the department of labor says, "We're sorry, Mr. Cone. You know, we can't tell you what to do. The law says so-and-so. But everybody has a right to sue, no matter what you do. If you go by the law, it's up to the court to decide whether you did or didn't. Chances are, if they sue"—if they sue"!;when they sue—"you'll be all right." Well, how in the heck, if you're starting in business today, are you going to put your money on the line, and hire anybody, running into that kind of a possibility? I mean, that's just who you hire or who you don't hire. You see, that was never on any books up until ten, fifteen, twenty years ago. You could hire anybody you wanted and fire anybody you wanted. And unfortunately, the guy that you hire today can leave you any bright day he wants to and find another job. He's not hooked. See, that is involuntary servitude, for him to agree that he'll stay with you irrespective. But you, as the employer, are up against all these daggone possible suits. Out here at this school I went to, I was on the board. They let a fellow go that was a teacher out there, and hell, he's suing the school right now. We've already paid $5,000 to a lawyer at this point. The government investigated and said nothing to it, but the guy still has a right to sue you through the courts, you see. I never knew this guy, but he was of Polish descent, Gabrowski or something like that, and a Catholic. One year the fellow at the last

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minute didn't come back, and so they went to this employment agency for professional people. He came down here for a year and didn't get along with the folks, and they let him go. Well, now he's suing, based on the fact that they fired him because he was Polish and a Catholic. Well, they hired him in the first place knowing he was Polish and a Catholic, but you see that's no defense. And the institution out there has spent $5,000 already fighting the damn thing. And this is a non-profit setup. Well, you can see it in the papers every day, some of these lawsuits.

HARRY WATSON:

Oh, yes.

CAESAR CONE:

It inhibits anybody wanting to start a business today. Frankly, I don't see anybody starting his own business anymore, with all the obligations. Now you don't know whether you're going to make it or not in the first place, but you've got all these obligations to anybody you even talk to, almost. If you don't hire somebody, he'll come along and say, "You didn't hire me because I was this, that, or the other." And here you are, before you've even started, up against all these extra costs. The labor unions can't meet their commitments. They've got no more power to make a guy work for you, if he doesn't want to, than you have. Involuntary servitude, that's slavery. And I don't think they should. But on the other hand, unknown you've got all these daggone guarantees, and you've got the possibility that you'll get sued. It's not only a question of who you hire and who you don't hire, but who gets sick and when they get sick. Lord knows, they tell me, some of these asbestos people now… Forty years down the road, somebody gets sick with cancer, and you know there are going to be

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cancer people, probably, forty years down the road. They'll say, "Oh, well, my father worked with cancer when I was a little boy, and therefore he came home with the dust on him, and I got it now forty years down the road." They'll sue somebody, if he can find him. I mean, it's something.

HARRY WATSON:

It makes things a lot more difficult, I can imagine.

CAESAR CONE:

They tell me some of these machinery manufacturers can't get liability insurance anymore. There's one of them here in Greensboro, Wysong and Miles Manufacturing Company. They make shears and all kinds of lathes and things for furniture manufacurers. Machinery like that lasts for years, and it goes through the secondhand dealers and so forth. They tell me that there have been some lawsuits in the machinery business. Machines that are forty years old that have gone through a half-dozen hands. Somebody doesn't maintain it or oil it or something, and something happens and somebody gets hurt. And they'll sue the manufacturer who made it forty years ago, although it's been through a half a dozen hands and abused and misused and whatnot.

HARRY WATSON:

We never quite got to your experiences as President of Cone Mills Corporation. We've talked about different aspects of that, but what do you think were the most outstanding achievements of your term? You were President, and then you were Chairman of the Board, I believe.

CAESAR CONE:

My oldest brother, Herman, was President and Chairman in 1955 when he passed away; he had a heart attack at sixty. I became President. I had been Treasurer and was more or less involved in putting the thing together and just getting listed on the Stock Exchange. They elected me President and my brother Ben as Chairman of the Board. He had been on the Board, but he hadn't been active in the business, and he was a big stockholder. But he was made Chairman to preside at Board meetings, really, and had no active assignment of duties.

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I don't know. Frankly, I think I did my best just to keep things together.

[TAPE 2, SIDE B]

CAESAR CONE:

We didn't have any revolutions, as occur in a great many companies, but we got rid of this nepotism by evolution, and this business of getting rid of old people, the development of a staff that was professional instead of nepotic, and the fact that we should close up plants that were inefficient and not just keep them running for the benefit of publicity or society. The further elimination of paternalism, that is, the village system and all; that started while I was Treasurer. And this idea of not merging, not getting bigger, better to stay small and profitable instead of big and unprofitable.

HARRY WATSON:

That was a real choice that you had to face.

CAESAR CONE:

Yes, we had plenty of opportunities to merge with this one, that one, and the other one. I guess my accomplishment was to turn things down instead of agreeing to go ahead. Some companies were aspiring to be as big as Burlington Industries, which is number one in the textile industry. We did get mixed up with an operation in Argentina, but we got out of it at no loss, thank God. We turned down an opportunity to go to Ireland, thank God. I think Burlington has had its problems over there. We turned down an opportunity to go to Mexico. I was down there checking on things. Several of our people went down there and worked in a plant for several months. We turned that one down. I guess you'd say I was a great turn-downer.

HARRY WATSON:

What was the reason behind that?

CAESAR CONE:

Because I didn't think it would be profitable, and I'm sure it turned out that way. Most everybody that went into that kind of stuff had a pretty bad experience with it. I won't mention any names, but I think maybe we turned down one or two that might have been profitable. I don't know. But I was conservative as far as borrowing money was concerned; I didn't want to get mixed up with getting loaded up with debt, and the company's in pretty good shape from that standpoint. We had to borrow for the first time in my experience when we built this finishing plant down in Carlisle, South Carolina, which has been a good investment because we've closed up the finishing plant here in Greensboro. We had waste disposal problems now and water problems and all kinds of problems here in Greensboro, so we built a new plant down in Carlisle, South Carolina, during my time. We had to borrow some money to do it. We had an experience with a takeover artist that we took care of. He lost about five or six million dollars on the deal, sold us the stock back at a big loss. He had bought about ten percent of our company. Like this fellow you read about up at Dan River.

HARRY WATSON:

Yes.

CAESAR CONE:

Now that guy's probably going to sell his stock to this crowd in Dan River at a nice profit. He's scared them to death.

HARRY WATSON:

Yes.

CAESAR CONE:

But we just sat and waited for this guy to make his move, and finally, when things got tough in 1970, he needed money, and he

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offered us the stock of ours that he had accumulated. And he told me that he was losing about ten to twelve dollars a share on three hundredodd thousand shares or something.

HARRY WATSON:

It adds up.

CAESAR CONE:

We bought it from him cheap, what we thought was cheap. But that was right interesting. These financial experts on Wall Street, I tell you, they live by their wits. Hepefully, they'll be able to make money off somebody else's hard work.

HARRY WATSON:

Right. You've been active in a lot of things besides the company itself. You mentioned the airport, the hospital, the Chamber of Commerce. Which of those things meant the most to you?

CAESAR CONE:

I enjoyed public service. Frankly, I got a bigger kick out of public service, really, than corporate service. I was always a little embarrassed to raise cain about wanting something for my corporation, figuring that I would be accused of being selfish. But when I was trying to push something that was in the public interest, why, I was free to raise all the cain in the world, because I wasn't trying to do it for myself or my associates, especially on this airport thing. But I enjoyed it. I think I accomplished some things.

HARRY WATSON:

What, for example?

CAESAR CONE:

I think I contributed considerably to the airport situation. But I don't know; I'll let the rest of the people talk about me. Ask somebody else.

HARRY WATSON:

[Laughter] All right. Fair enough.

CAESAR CONE:

You'd better do it in a hurry, though, because they're all about dead. They were my contemporaries. [Laughter]

HARRY WATSON:

If they're as lively as you are, I don't think there'll be any problem with that.

CAESAR CONE:

I went over to my brother's office in the Southeastern Building when the other gentleman was up here, and he interviewed both of us, as you know. My brother's got a wall full of plaques, "Man of the Year" and this, that, and the other from all kinds of things. Well, I ain't got any plaques in here. The only things that I've got in here are what I accomplished, not what the other fellow honored me for. It's kind of a generation away from my family, but my children, I accomplished that, and I accomplished a couple of things out there on the wall on my own.

HARRY WATSON:

Tell us what they were, so it'll be on the tape.

CAESAR CONE:

I learned how to fly an airplane in 1929. I played tennis down at the University of North Carolina in 1927, and that's all I've got out there. Everything else that anybody else gave me just because of honors and all, why, you don't see that. Go ask them.

HARRY WATSON:

[Laughter] Okay, fair enough.

CAESAR CONE:

No, I enjoyed it. I say I enjoyed… Unfortunately, a lot of the things I ran into disappointed me because of the political impact. Now take the University of North Carolina. Gordon Gray was head of the Chapel Hill campus; whether he was President or whether he was Chancellor, I don't recall. But he asked some of us to come down there one night. He was setting up a businessman's advisory council or some such, and two of us from Greensboro were invited. Howard Holderness was President of the Jefferson Standard Life Insurance

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Company at the time, so the two of us drove down together. Then we had dinner in the Morehead Planetarium and had this meeting with the bigwigs from around the state. What can the University School of Commerce do for business? Well, it was all set up ahead of time. It was so easy. It was set up to put in this program. How long have you been down there?

HARRY WATSON:

Seven years.

CAESAR CONE:

I think Mr. Willard Graham was the first one that set up this Executive Program in the Commerce School, for weekends, if you're familiar with that. Executive training. We need to train executives. Well, I got up on my two feet and said, "Well, now wait. It looks to me like if you could put courses over here in the School of Education to teach more or less the free enterprise system and develop textbooks to put courses in the grammar schools and in the high schools to broaden the understanding of income taxes, etcetera, etcetera, keep records…" My kids came home and didn't want to keep any records of anything. When I was a kid, I had to keep records. Each week I got my allowance, and I had to keep a record of how I spent it. Save it or spend it, but I had to have my books. At this time, my kids were coming along. The hell with it. "Oh, no, we need training." And I said, "I don't think we've got to worry about the crown princes. After all, we can hire them from New York or some of the schools that are already doing this kind of thing, but why should North Carolina have to?" And, "Oh…" Well, it was all obvious that it was set up, so they put the thing in. Which was all right, it wasn't bad, but they

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never had another meeting of the business executives. In other words, it was to bring everybody down there so they could say business has been involved and wants it. Bob Hanes was President of Wachovia at the time, and he got up and said, "Oh, we need this training, because every time somebody who's running a small business dies and we're the executor of the estate, why, we have to provide somebody to the widow to run this guy's business. They're taking our people, and we've got to have more trained people to run these kind of things." So you could see it was all set ahead of time. [Laughter] It's what I say about politics. Now I don't say that this wasn't fine, but we weren't called down there to develop ideas; the idea had already been developed by Gordon Gray from Winston and Bob Hanes from Winston. What they wanted to do when they called the rest of us down there [was] to more or less put our stamp on a fait accompli, don't you see, or an idea accompli. Now I run into the same thing other places. I think I want to put this on the tape. This is interesting. When I was on the airport, the Federal Aviation Agency came along and said, "You've got to clean out some of your approach zone." There was a big old tree at the end of this. I went to see the dairyman that was running this dairy, Walter Coble, and I said, "Mr. Coble, how about letting us cut your tree down or else top it?" He said, "The tree isn't hurting me, Mr. Cone, but why should I do anything to help Greensboro? I can't even sell my milk in Greensboro." I said, "Why not? What do you mean?" "Well," he says, "you know, my milk goes down to my brother, George Coble, in Lexington, Coble Dairies, where the pasteurizing plant is. They've got an ordinance in Greensboro that no milk can

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be sold in Greensboro unless it's pasteurized within the city limits." I said, "I didn't know that." He said, "Yeah, half the dairies in Guilford County, their milk goes down to my brother's place in Lexington, but that's forbidden." Ben, my older brother who recently died, was Mayor of Greensboro at the time, and I came back to Ben and said, "Ben, did you know this was happening?" He didn't know it. So he went to his city attorney. "Oh, yeah." The City Health Department were riding herd over the sanitarians, and they called in Dr. Harter. Dr. Harter said, "Oh, yeah, we have to be responsible for the butterfat content and the bacteria content, and my department has to inspect these pasteurizing plants. And if we had to go to Lexington or to Biltmore Dairies or wherever, all over the state, why, my budget would be tremendous. Not only that, but we have to inspect the milk sheds to be sure the dairies are cleaning up the udders or whatever." My brother said, "Well, how does Mr. Coble down here ship milk all the way from Washington to Miami?" "Well, if you want to let other health departments down in Davidson County take over your responsibility, fine, but suppose something would happen, and you folks, your City Council, is responsible." In the meantime, there were two here in Greensboro: Guilford Dairy is a coop and was in the city, and Pet was in the city. Well, they had every lawyer in town meet [beat?] on my brother and the City Council. "Oh, this would be very upsetting, and just think of the responsibility you're taking on your shoulders if you open this thing up." Well, boy, they did it, and of course from then on we can have milk from any of them. But that's an example, you see, of what you run into.

HARRY WATSON:

You've expressed a lot of frustration with government in our conversation. Was there a time when industrialists could get a more reasonable treatment from government or had a closer relationship with government officials that are missing now?

CAESAR CONE:

I don't know. I tell you, I think this: I think you had a far better type of elected official some years ago than you have today, and I'll tell you why, and understandably so. Take the City Council here in Greensboro. They didn't used to pay anybody much, a few hundred dollars a year. I mean the honor and the desire to serve was what made people go on the Council, and they were responsible people. Like this milk thing. I don't think the City Council today would have gotten rid of that milk ordinance, because some lawyers would have scared them. You see? They had a different type on the Council, businessmen who were willing to take a risk. But here's your problem. When Ben was Mayor, he'd get a call once in a while about a hole in the street, or the streetlight is burned out, or the garbage wasn't picked up. Today, "I lost my job," "I didn't get my raise," "I couldn't rent this apartment