USWA: Republic Technologies Bankruptcy Underscores Need for Comprehensive Solution to Steel Crisis

Apr 02, 2001, 01:00 ET from United Steelworkers of America

    PITTSBURGH, April 2 /PRNewswire/ -- United Steelworkers of America (USWA)
 President Leo Gerard today called the bankruptcy filing of Republic
 Technologies International "the latest evidence of the urgent need for a
 comprehensive solution to the ongoing steel crisis," and condemned
 "the so-called 'free trade' policies that have pushed the steel industry to
 the brink of extinction in the United States."
     With its filing today in U.S. Bankruptcy Court in Akron, Ohio, Republic
 became the eighteenth steel company to seek bankruptcy protection since
 December 1997.  Ten steel companies have filed bankruptcy since
 November 13, 2000 -- a rate of one bankruptcy every two weeks.
     "How many more bankruptcies will it take until we get action to resolve
 this crisis?"  Gerard asked, pointing to the predatory practices of foreign
 steel companies documented last year in the U.S. Commerce Department's report,
 Global Steel Trade -- Structural Problems and Future Solutions.
     "We need to stop the flood of illegally-priced imports that have depressed
 steel prices to the point where it's nearly impossible for any steel company
 to turn a profit," Gerard said.  "But we also need to protect retiree benefits
 that are already at risk, and provide access to vitally needed fund to allow
 the industry to continue to modernize.
     Gerard said America's ability to meet a greater share of its domestic
 demand for steel must be protected during any consolidation of the industry.
 "That's why we're pressing for a more comprehensive solution through the Steel
 Revitalization bill now before Congress (HR 808)," he said.
 
     The Steel Revitalization Act (HR 808) calls for:
 
     *  A five-year rollback of steel imports to pre-crisis levels to provide
         an umbrella under which the U.S. steel industry can restructure and
         revitalize itself.
 
     *  Removing retiree health care costs as an impediment to industry
         consolidation and the ability of U.S. steel companies to compete
         globally by establishing a Taft-Hartley trust fund, financed by a
         1.5% surcharge on all steel sold in the U.S.  In 1999, the American
         steel industry paid almost $875 million in retiree health benefits --
         a cost that none of our competitors in the industrialized nations have
         to pay.  This liability has also contributed to the fragmentation of
         the domestic industry among dozens of small companies by increasing
         the costs of steel-company acquisitions.
 
     *  Establishing a $10 billion loan fund to help the steel industry finance
         continued modernization and ensure the survival of domestic employment
         and productive capacity.
 
     *  Additional measures to promote responsible industry consolidation by
         providing grants to defray the costs of environmental compliance at
         newly acquired steel facilities.  These grants would be contingent on
         the acquiring company maintaining target levels of employment and
         productive capacity.
 
 

SOURCE United Steelworkers of America
    PITTSBURGH, April 2 /PRNewswire/ -- United Steelworkers of America (USWA)
 President Leo Gerard today called the bankruptcy filing of Republic
 Technologies International "the latest evidence of the urgent need for a
 comprehensive solution to the ongoing steel crisis," and condemned
 "the so-called 'free trade' policies that have pushed the steel industry to
 the brink of extinction in the United States."
     With its filing today in U.S. Bankruptcy Court in Akron, Ohio, Republic
 became the eighteenth steel company to seek bankruptcy protection since
 December 1997.  Ten steel companies have filed bankruptcy since
 November 13, 2000 -- a rate of one bankruptcy every two weeks.
     "How many more bankruptcies will it take until we get action to resolve
 this crisis?"  Gerard asked, pointing to the predatory practices of foreign
 steel companies documented last year in the U.S. Commerce Department's report,
 Global Steel Trade -- Structural Problems and Future Solutions.
     "We need to stop the flood of illegally-priced imports that have depressed
 steel prices to the point where it's nearly impossible for any steel company
 to turn a profit," Gerard said.  "But we also need to protect retiree benefits
 that are already at risk, and provide access to vitally needed fund to allow
 the industry to continue to modernize.
     Gerard said America's ability to meet a greater share of its domestic
 demand for steel must be protected during any consolidation of the industry.
 "That's why we're pressing for a more comprehensive solution through the Steel
 Revitalization bill now before Congress (HR 808)," he said.
 
     The Steel Revitalization Act (HR 808) calls for:
 
     *  A five-year rollback of steel imports to pre-crisis levels to provide
         an umbrella under which the U.S. steel industry can restructure and
         revitalize itself.
 
     *  Removing retiree health care costs as an impediment to industry
         consolidation and the ability of U.S. steel companies to compete
         globally by establishing a Taft-Hartley trust fund, financed by a
         1.5% surcharge on all steel sold in the U.S.  In 1999, the American
         steel industry paid almost $875 million in retiree health benefits --
         a cost that none of our competitors in the industrialized nations have
         to pay.  This liability has also contributed to the fragmentation of
         the domestic industry among dozens of small companies by increasing
         the costs of steel-company acquisitions.
 
     *  Establishing a $10 billion loan fund to help the steel industry finance
         continued modernization and ensure the survival of domestic employment
         and productive capacity.
 
     *  Additional measures to promote responsible industry consolidation by
         providing grants to defray the costs of environmental compliance at
         newly acquired steel facilities.  These grants would be contingent on
         the acquiring company maintaining target levels of employment and
         productive capacity.
 
 SOURCE  United Steelworkers of America