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The industrialist who made Pullman Palace Cars for tired railroad travelers also built a company town for his workers, a move of goodwill he thought would help prevent labor strikes.

Instead, George Mortimer Pullman's policies backfired, igniting a nationwide labor war a century ago that helped plant the seeds of the modern labor movement.In the wake of a bloody strike against Pullman, labor unions reorganized, company towns in industrial areas declined and negotiators began using arbitration to settle disputes.

"What people carried away was the conviction something needed to be done," said Jim Barrett, professor of history at the University of Illinois. "Even conservative business leaders looked at creative ways they could deal with the labor problem."

It wasn't the first strike to attract national attention. Unlike its predecessors, however, the Pullman dispute spread across 27 states and shut down the nation's main transportation network.

Pullman built the town with his name on what is now Chicago's far South Side in the early 1880s to house workers for his factory. He owned the houses and charged workers rent.

He said the town represented a great step forward in labor-industrial relations.

The workers who lived there disagreed.

"The people of Pullman are not happy and grumble at their situation even more than the inhabitants of towns not model are accustomed to do," the New York Sun wrote in 1885. "They secretly rebel because the Pullman Company continues its watch and authority after working hours.""When (Pullman) was 30- or 40- years-old, he had ideas," said Paul Petraitis, a current resident of the Pullman area and local researcher. "When he was in his 50s and 60s, he didn't want the responsibilities."

An economic downturn in 1893 and 1894 forced Pullman to cut wages, but he didn't lower the rents on his houses.

Three members of a grievance committee were fired and some 3,000 workers walked out on May 11, 1894.

"Pullman was a very big force - love him or hate him - he was a flash point," said Susan Hirsch, a labor historian at Loyola University Chicago. "There was a tremendous outpouring for support of workers who were seen having this tyrant over them."

In June, American Railway Union president Eugene Debs called a nationwide boycott of Pullman cars: Workers would not handle any train containing a Pullman car.

"The railroad companies decided to provoke a crisis by attaching Pullman cars to every train," including postal cars in an effort to involve the government, said Leslie Orear, president of the Illinois Labor History Society.

Gov. John Peter Altgeld and Chicago Mayor John Hopkins supported the strikers, but in early July President Cleveland sent more than 2,500 troops to make sure trains moved.

At least a dozen people were killed; exact numbers are still in dispute.

The strike and boycott cracked within a week of the troop deployment.

Everyone involved lost, historians agree. The strikers got no concessions from Pullman. Railroad operators lost millions.

The repercussions went far beyond Pullman. Unions moved toward representing specific trades rather than whole industries and labor leaders began working to get more political influence.

"There was a general awareness in the working class communities around the country that there was a need for a political response to the very cozy relationship of employers to the federal government," Orear said.

The American Railway Union, which had sought to represent all trades under one roof, disappeared within a year. Debs ran unsuccessfully for president five times as a socialist.

A national commission on the strike found fault with both Pullman and federal involvement, and suggested arbitration to resolve labor problems.

George Pullman died two years later. His body was buried under tons of concrete and railroad ties to protect it against revenge-minded grave robbers.

The town of Pullman also died. The Illinois Supreme Court disincorporated it in 1898 after ruling a company couldn't own a town. The city of Chicago swallowed it a few years later.

The Pullman factory in Chicago has been closed since 1982.