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In the building industry, shot through with featherbedding union practices, they had another advantage: neither the subcontractors nor Levitt's organization is unionized and there has been no great pressure from unions. Legend has it that once, when unionists were picketing Levittown, one of the pickets left the line to look at a house. He got so interested he ended by buying one. Says Bill Levitt: "I'm not against unions. I just think we can build houses faster without them."
Shortage into Plenty. Levitt builds them faster by using paint sprayers and many other labor-saving gadgets banned by the building unions. He prefabricates many of his materials. At his central warehouse, all the lumber needed in a house is precut to size, plumbing fixtures are assembled, staircases are prefabricated; thus only 20% of the construction work need be skilled labor.
When lumber was scarce, Bill Levitt had plenty; he had bought Western timberlands and a mill to supply him. When nails were short, he set up his own nail-making plant, made enough to sell to outsiders. When Congress lifted a veterans' priority clause, Levitt announced that vets would still come first at Levittown, thus had a potent lobby to work for him whenever he ran up against local building restrictions or Washington bureaucrats.
But his greatest coup was forcing manufacturers to sell to him direct, a practice traditionally frowned on by them. By browbeating, cajoling and threatening to take his business elsewhere, Bill Levitt now buys even his television sets from the manufacturer, pays no middleman's fees. By his special building and buying methods, he saves $1,000 a house.
Although he has a reputation as a know-it-all, he is quick to pick up good ideas. When a prospective buyer complained that he could get a four-burner stove that would take up no more room than the three-burner ones in Levittown houses, Levitt said: "You get it and I'll buy it." The buyer did, and Levitt canceled an order for 1,000 of the old stoves and paid $4.50 more apiece for the new ones.
Despite his own success, Bill Levitt is no foe of public housing; he thinks it is still needed. And he thinks the "dog-in-the-manger" attitude of building associations against it is "stupid." Says Levitt: "Some public housing is necessary for the lowest income brackets. Private industry can't build profitably for them."
The Levitts' own building has been hugely profitable. As president and co-owner (50%) of the $10.5 million Levitt & Sons, Inc., Bill pays himself $125,000 a year; Architect Alfred, who owns the other 50%, draws the same. Father Abe, who now spends his time landscaping, is paid $60,000 for being what some Levittowners call "vice president in charge of grass seed." From outside interests (e.g., the California timber stands and two country clubs which are operated in connection with the Levitts' more expensive Strathmore developments) the brothers get another $150,000 a year apiece. And when they sold 4,028 of Levittown's rental houses (leaving them only 1,600 rental units) to Philadelphia's Junto School (TIME, March 13) for $5,150,000, a big chunk of it was clear profit, taxable at 25% as a long-term capital gain.