text: Charles M. Schwab (1862–1939) and Eugene Grace (1876–1960) made Bethlehem Steel the second-largest American steel company by the 1920s. Schwab had been the operating head of Carnegie Steel and US Steel. In 1903 he purchased the small firm Bethlehem Steel, and in 1916 made Grace president. Innovation was the keynote at a time when U.S. Steel under Judge Elbert Henry Gary moved slowly. Bethlehem concentrated on government contracts, such as ships and naval armor, and on construction beams, especially for skyscrapers and bridges.  Its subsidiary Bethlehem Shipbuilding Corporation operated 15 shipyards in World War II. It produced 1,121 ships, more than any other builder during the war and nearly one-fifth of the U.S. Navy's fleet. Its peak employment was 180,000 workers, out of a company-wide wartime peak of 300,000. After 1945 Bethlehem doubled its steel capacity, a measure of the widespread optimism in the industry.  However the company ignored the new technologies then being developed in Europe and Japan. Seeking labor peace in order to avoid strikes, Bethlehem like the other majors agreed to large wage and benefits increases that kept its costs high.  After Grace retired the executives concentrated on short term profits and postponed innovations that led to long-term inefficiency. It went bankrupt in 2001.