Today in the Americas, the Importation of Steel

Today is the 60th anniversary of the US general strike by the United Steelworkers of America against the steel corporations that were reaping profits in place following the surging post-World War II economy. US foreign policy, following the war, centered around development and growth across the war-torn world, especially Western Europe. United States steel played an integral part.

As stipulated in the Steelworker’s union contract, management could not introduce new technologies that reduced worker’s hours or wages. On July 1, 1959, the contract with the steel corporations ran out and on July 15th, 500,000 workers shut down every plant in the country. The economic impacts were huge. According to TIME,

With stockpiles reduced sharply, dozens of industries are slowing down and beginning to lay off. Auto, appliance, farm-equipment, machinery makers are all tightening their belts, and they face still more trouble before the economy is rolling at full speed again…

Detroit’s automakers, who consume 15% to 20% of the nation’s steel, are worst off, face heavy layoffs in the next few weeks. General Motors has already laid off 60,000 of its 330,000 production workers, will lay off another 60,000 this week…

To the nation’s harried railroads, who hoped for a boost in booming 1959, the strike dealt a smashing blow. In 13 weeks the roads lost an estimated $459 million in gross revenues. Railroad employment on Sept. 30 fell to 797,195, the lowest since 1900….

Even the Defense Department was worried. As TIME again noted,

“The strike slowed construction of vital defense projects, such as the Air Force’s new Intercontinental Ballistic Missile launching base at Denver’s Lowry Air Force Base.”

The DOD was worried it wouldn’t have enough steel to keep the country running [see war-making]. As TIME continued, “Military projects need steel so badly that the Commerce Department has notified steelmakers that top priority must be given to missiles, missile-launching sites and nuclear submarines.” Because of the US military’s thirst for weapons, the United States, for the first time in its history, imported steel in an effort to break the strike.

It worked.

There was not a united front. The AFL-CIO pressured the union to end the strike, mainly on national security interests. Other unions, as noted above, felt the effects of the steel strike. Some lost their jobs or wages. Thus, President Eisenhower set in motion the machinery of Taft-Hartley, a bill signed in 1947 to limit the power and scope of labor unions, referred to by labor leaders as a “slave labor bill,” and ordered the steelworkers back to work. The Courts sided with the government after the steelworkers took the Taft-Hartley Act to court. In November of 1959, in Steelworkers v. United States the US upheld the appellate courts decision.

But eventually, the workers won their modest wage increases but to the detriment of the entire industry. With Japanese and Korean steel, two economies controlled by the United States, costing less, the shutdown of steel plants devastated the entire industry. Instead of imports being negotiable given the country’s need, now (and today) cheap imports flood the market.

What was once seen as the end of American industry has since become an ideology. United States’ steel has become a parable for all sorts for the strength of US industry and manufacturing – weakening by the hour, blighted by the minute.

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~ by Daniel on July 15, 2009.

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