AHC: Prevent collapse of American Steel Industry

[Deleted member 145219]

The American Steel industry almost utterly collapsed during a period from the mid 1970's to the early 1980's. Several companies and facilities that survived this period folded in the early 2000's. This can be contributed to the rise of foreign competition from Japan, and later China. Outdated Manufacturing facilities and processes. Along with large workforces and retirement costs.

Your challenge is to prevent the collapse of the American Steel Industry during the 1974 - 1983 period. You don't need to focus on maintaining the high levels of employment that the industry had. And you can close antiquated facilities and have the industry commit to constructing new plants.

 

[Sam R.]

A: sell and liquidate to break unions

B: Scrap BOS right to work semi refined railhead and a grossly corrupt local and state government. Specialist steels.

I’m guessing the historical issue is half doing a and b so a corrupted semi stable industry survives.

 

[THE KINGFISH]

Perhaps my best guess would be to invest in updated facilities and provide incentives for manufacturing to move to the Deep South/Southwest? Though the Midwest still becomes the Rust Belt, manufacturing is sent down South where it’s cheaper and as a result quality of life improves there.

 

[Scerus]

This requires a level of federal economic intervention / involvement that is well beyond what is accepted in the U.S.
I can't see any other way aside from 75% tariffs on imported steel and a web of subsidies.

 

[Bored Young Man]

This requires a level of federal economic intervention / involvement that is well beyond what is accepted in the U.S.
I can't see any other way aside from 75% tariffs on imported steel and a web of subsidies.

Agreed, steel is a simple commodity at this point and all that mattered was: cost of ore, electricity, transportation, and labour: none of which America had an advantage in.

 

[Legofan4]

Agreed, steel is a simple commodity at this point and all that mattered was: cost of ore, electricity, transportation, and labour: none of which America had an advantage in.

True. Any potential gains in transportation cost would be more than off set by the much higher cost of labor in America. Which really is problem with many industries that have been moved overseas.

 

[I lurk therefore I am]

A: sell and liquidate to break unions

B: Scrap BOS right to work semi refined railhead and a grossly corrupt local and state government. Specialist steels.

I’m guessing the historical issue is half doing a and b so a corrupted semi stable industry survives.

Absolutely nothing to do with the Unions and all to do with capitalism and greed.

Why pay an American worker a decent wage when you can outsource production to developing countries for a fraction of the price and pay the rest to the shareholders in big dividends.

Outsourcing to cheaper labour overseas killed US (and many European) industries, not the Unions.

Only way to stop it is to insist on American infrastructure, cars, trains, buses, ships, military things etc being built with US produced steel. Of course, that will mean more tax payers money being spent.

 

[Sam R.]

Absolutely nothing to do with the Unions and all to do with capitalism and greed.

Why pay an American worker a decent wage when you can outsource production to developing countries for a fraction of the price and pay the rest to the shareholders in big dividends.

Outsourcing to cheaper labour overseas killed US (and many European) industries, not the Unions.

I’d like to think that the unions directly resulted in a price of labour that was fit for human life.

That capital attempts to destroy fit human life in order to maximise profit was taken as an assumption: the destruction of the unions was historically and would be Allohistorically an aim and the basis of reducing costs and thus increasing surplus value relative to doing it in China in blast furnaces and then transshipping the steel.

 

[Bored Young Man]

Why pay an American worker a decent wage when you can outsource production to developing countries for a fraction of the price and pay the rest to the shareholders in big dividends.

Exactly, why should Canadians pay American mill workers for the same thing as someone offering the same thing for less? Because you feel that they deserve from some hidden margin that aren't on the quarterly reports of publicly listed steel mills? Or are steel workers somehow more entitled than the average American?

Outsourcing to cheaper labour overseas killed US (and many European) industries, not the Unions.

Only way to stop it is to insist on American infrastructure, cars, trains, buses, ships, military things etc being built with US produced steel. Of course, that will mean more tax payers money being spent.

Autarky hasn't worked for the last century and it works both ways for the largest destination of international investment in the world. Of course neither does the other extreme as Toyota learned post 2012 earthquake which paid handsomely during the chip shortage of 2021-2023 where its stockpile of essential goods came in handy. The real answer is a murky-mostly free-trade with some safeties.

I’d like to think that the unions directly resulted in a price of labour that was fit for human life.

Maybe, except for all the poor saps without the privilege of being in the union.

 

[Bored Young Man]

True. Any potential gains in transportation cost would be more than off set by the much higher cost of labor in America. Which really is problem with many industries that have been moved overseas.

Also, most of the world's cement and steel are being used in China which happens to be major producers of both bulky and low-value goods.

 

[Sam R.]

Maybe, except for all the poor saps without the privilege of being in the union.

If you’re inviting a lecture on the Australian award system and social democratic margins versus labour aristocratic and peripheral analysis this is your chance to say that you’re not.

 

[psychedout265]

I’d like to think that the unions directly resulted in a price of labour that was fit for human life.

That capital attempts to destroy fit human life in order to maximise profit was taken as an assumption: the destruction of the unions was historically and would be Allohistorically an aim and the basis of reducing costs and thus increasing surplus value relative to doing it in China in blast furnaces and then transshipping the steel.

The steel industry is converted into a series of non-profit worker-owned cooperatives and they reduce the profit margin and figure out ways to cut costs without shuttering factories or corporate mergers like what went on in the 1980s.

 

[Legofan4]

The steel industry is converted into a series of non-profit worker-owned cooperatives and they reduce the profit margin and figure out ways to cut costs without shuttering factories or corporate mergers like what went on in the 1980s.

And probably still get outcompeted by China and India.

 

[Sam R.]

The steel industry is converted into a series of non-profit worker-owned cooperatives and they reduce the profit margin and figure out ways to cut costs without shuttering factories or corporate mergers like what went on in the 1980s.

Coops have a lot of problems getting funding. Even the pension fund won't buy in.
Steel was at the end of life cycle of a lot of out of date under-productive processes.
China was willing to pay the dead men that the US paid 80 years earlier, and the dead sulpherated children, and the environmental toxicity, and the abject suffering of steel cities. US steel workers were less willing to tolerate these.

I can see BOS and arc surviving for specialist steels, but it would take a pension fund willing to "risk the lot" on their own industry, and it would still require mass layoffs in blast furnaces. I mean hell, in NSW Wollongong survived because there were years left on the plant. Newcastle makes specialist steels from scrap using arc.

Arguing that dead blast furnaces ought to profitably survive is like making an argument in favour of drop hammer finery.

yours,
Sam R.
(I am aesthetically incomplete in a city which doesn't smell of sulphur. If I see a quench my heart rises and all is right in the world. I yearn to live in a city where a beast on the horizon eats men and shits rod and bar. But I believe my response is broken and wrong, and that blast furnaces ought not to exist.)

 

[Kevin C. Smith]

Part of this is what is meant by "the steel industry"? Turning ore into basic ingots/slabs/shapes? Making those into semi finished products? Turning those semi finished products into finished goods?