Change and American steel
For thousands of immigrants from such countries as Poland, Italy, Yugoslavia, and Hungary, the once-mighty US steel industry offered entry to the American dream. The towering mill smokestacks of the upper-Midwestern and Northeastern United States meant jobs. And because of the clout of unions such as the United Steelworkers of America, wage packages were among the highest in American industry.Skip to next paragraph
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So when hard pressed domestic steel firms - such as US Steel, the nation's largest producer - announce large-scale plant closings, as the firm did this week, one can understand the dismay. There is the matter of the personal hardship for the workers and their families, and a need for government and industry assistance to help workers find new employment. The US Steel decision will affect 15,000 workers and involve partial or total closure of some 30 steel mills and mines in the US.
In a larger sense, there is the need for the United States, amid all the industrial downsizing and restructuring now taking place, to ensure that the nation maintains a steel industry adequate to future as well as present manufacturing needs.
Ensuring a vigorous steel industry involves more than nostalgia. There are considerations of national security and industrial sufficiency. Should the US be dependent on other nations for its steel needs? How can former steel mills and other facilities be recycled for newer industries? How can laid-off workers be matched with appropriate new work? Surely the White House and Congress need not accept the premise that former steel-producing communities can be turned into barren industrial wastelands devoid of new plants and jobs.
The industry's overall challenge is great. Wage increases have too often exceeded productivity gains. Many US mills are technologically outdated. Management has been stodgy. And imports have become a large chunk of the market. Granted, European and Japanese producers have voluntarily reduced their exports. But low-wage steel from third-world nations such as South Korea and Brazil is pouring into the US. And the soaring dollar works against US exports.
What is to be done? US producers might well consider joint ventures with overseas producers. A US Steel venture with British Steel has fallen through as of this writing. But future ventures should not be ruled out. And Washington should press its case against subsidizing new steel plants in third-world nations. A global agreement against such subsidizing would surely benefit the industrial nations. Finally, the US industry should continue its modernization while taking all possible steps to relocate and find new work for those who helped make the US steel industry into the giant it became.