This song commemorates the 1985 Hormel strike. The strike was long and brutal (National Guard came in, and the community became very divided), and the local workers were broken by their own national union. The national union ordered the local to go back to work, and the local workers refused, except some loyal to the national organization who crossed the picket line.
The national organization put the local into receivership and took it over, and the strike was over. Hormel got what it wanted, hiring Mexican immigrants at lower wages. The company, the government, and the national union were complicit in an outcome that transformed a working class town into something different, and things were never the same again. Mostly forgotten now.