A dramatic confrontation between organized labor and open-shop forces began in Galveston on March 12, 1920, when some 1,600 coastwise longshoremen in the Island City joined dockworkers in various South Atlantic and Gulf ports in a nationwide walkout. The confrontation resulted in a clear victory for open-shop advocates, virtually destroyed locals of the International Longshoremen's Association, and resulted in the enactment of an open-port law by the Texas legislature.
To combat the strike the Mallory and Morgan steamship companies sought to destroy ILA effectiveness by using white scabs for jobs previously given to black ILA locals and employing black scabs to replace workers in all-white locals. Although black and white ILA locals had a record of sharing dock work harmoniously for some fifty years in Gulf Coast and South Atlantic ports, the skillful exploitation of the race issue by Galveston open-shop advocates brought about an atmosphere in which race riots appeared imminent. Although the Galveston City Commission initially supported the strikers, the threat of violence increased until, on May 13, the mayor and chief of police asked Governor William P. Hobby to send a detachment of Texas Rangers to protect the nonstriking workers. By the end of May the Mallory line had suspended its Galveston operations because of potential violence against its strikebreakers. Becoming concerned that the shipping companies would move to other ports, local businessmen began to pressure the governor to intervene further. Mayor Sappington and members of the Galveston city commission insisted that they did not need more outside assistance to maintain order. In the midst of these events forces opposed to the union organized a Galveston Open Shop Association. Tensions grew amid rumors that the city's deep-sea longshoremen might join the strike in sympathy with the coastwise dockworkers. On June 7 the governor declared martial law and sent in 1,000 national guard troops. Although deep-sea longshoremen never joined the strike, the possibility of their doing so, along with the presence of the rangers and state militiamen, the prevailing racial tension, and sporadic confrontations between strikers and nonunion dockworkers all added to the tension. The Mallory line also brought in Mexican workers in such numbers that the president of the Galveston Trades Council complained of "a regular Mexican colony" on west Galveston Island.
The city commissioners, the Galveston Dock and Marine Council, and the state's labor press all argued that the true reason behind Governor Hobby's decision to order troops to Galveston and to keep them there after the tension cooled was to destroy union effectiveness and to guarantee an open-shop labor market. In July Hobby suspended the mayor, city commissioners, and police force for failing to maintain the peace and protect citizens. The police were disarmed, and Gen. Jacob F. Wolters took control of the courts and jails. The mayor, city attorney, and commissioners could perform routine duties but retained no powers to enforce penal laws. The city commissioners filed a suit against Governor Hobby, General Wolters, and the Texas National Guard, but the case was dismissed by Judge Robert C. Street of the Fifty-sixth District Court. The strike-induced martial law was challenged by a private citizen, who, after being arrested for a traffic violation, brought suit in a federal district court questioning the constitutionality of martial law in Galveston; the court, however, upheld Hobby's action in the matter. Ultimately, negotiations between city and state governments resulted in the withdrawal of the national guard at midnight, September 30, 1920, but some Texas Rangers remained until January 1921 to supervise the Galveston police department.
The Galveston ILA locals returned to work between December 1920 and July 1921 with a pay increase far below that demanded in March 1920. Furthermore, the new contract permitted the employment of nonunion workers; thus, though the Galveston ILA locals survived the 1920 conflict, the use of state troops and nonunion labor to crush the strike and the specter of a state government fully supporting local and state open-shop forces badly demoralized Galveston's union men. By 1924 the impotent Galveston ILA locals had been replaced by company unions.
The conflict inspired open-shop advocates to pressure the state government on behalf of their cause; Governor Hobby responded by calling the legislature into special session to deal with recommendations that the legislature soon fashioned into an open-port law banning any actions that might hinder the free passage of trade within the state. Although loudly denounced by organized labor as antistrike legislation, the bill, enacted in October 1920 and effective on January 2, 1921, was invoked in a number of Texas cities by Governor Pat Neff during a railroad shopmen's strike in 1922. In 1926 the Texas Court of Criminal Appeals ruled the law unconstitutional. The Galveston longshoremen's strike of 1920 successfully pitted a coalition of open-shop business elements and the state government against organized labor. The prevailing antilabor attitude has since continued to permeate Texas.