LTV and workers agree on plan, but still face challenge
The company, the union and the creditors all have a stake in the emergence of LTV Steel from bankruptcy and all are bearing their shares of the burden.
But even with an agreement this past week between the United Steelworkers of America and LTV, even with the approval of U.S. Bankruptcy Court Judge William Bodoh, LTV still faces a difficult road back to profitability.
And it still faces the same monumental challenge in the market place that every U.S. steel company does, rising levels of imported steel, some of which the domestic steel industry and unions allege has been dumped on the U.S. market at prices below what it cost to produce.
Some airily dismiss LTV and other aging U.S. steel companies as dinosaurs that should be allowed to starve to death in a world economy in which only a few behemoths will survive. None other than The Wall Street Journal took that position recently.
But we don't believe it is in the best interests of the United States to have all the steel in the world produced by a handful of multinational corporations that in the interest of the bottom line are just as happy to produce steel in Indonesia as in Indiana.
The American Iron and Steel Institute reports that steel imports to the United States more than double between 1990 and 2000, from 17 million tons to 38 million tons. Imports peaked in 1998 at 41 million tons.
We're hoping that the International Trade Commission investigation ordered by President Bush uncovers the evidence necessary to put a stop to the dumping and to punish the transgressors.
Reasons for hope: For a number of reasons, we're also hoping that LTV is able to work its way out of bankruptcy.
From a provincial standpoint, we want to see the LTV jobs that remain in the Mahoning Valley preserved. On the national level, we're interested in the continued survival of a domestic steel industry, not only because it is good for the economy, but it is vital to national defense. And on a gut level, we'd just like to see two sides that have come together as have the workers and owners of LTV succeed in their efforts.
The union agreed to changes in work rules, elimination of jobs and the borrowing of $140 million from a benefits guarantee fund to pay current health-care costs.
The company agreed to 20 percent employee ownership, two seats on the board of directors and profit sharing.
That last, profit sharing, only becomes a factor when both sides succeed in their goal of rebuilding the company -- and for that they're going to need some help from Washington.