A specific observation on the US domestic steel industry. Bethlehem has terminated all its domestic metallurgical coke production in favor of cheaper and cleaner (for the US environment) imported coke from South Korea, Japan and China, taking advantage of the temporary low price of coke caused by the slow down of demand for steel in Asia and also the currency devaluation. Steel is one of the early casualties of the Asian contagion to US shores Now, it does not take a rocket scientist to figure out this is a dead end strategy for US domestic steel, because imported coke will not stay low price forever. For a while in the 70s, companies such as Lukens excelled because they concentrated on specialty high grade steel priducts, but they failed to build a lasting cooperative relationship with their unions. Also offshore facilities have been catching up on the technology. Lukens has since been merged. There is no way to save the domestic steel industry on economic terms within currency trends. The only hope rests on economic nationalism, i.e. tarrifs, quotas, anti-dumping 301s, etc. Unfortunately, the US is the leading crusader against economic nationalism. It is to U.S. domestic steels's interest to close rank with Asian economic nationalism, led by Malaysia, to fight global capitalism on behalf of workers and small business. The strongest case of course is the need for a reliable supply of steel in case of war. Also, domestic steel should support the army over the navy. The army places strong value on domestic supply, but the navy, in its hubris about its confidence in breaking enemy embargos, thinks globally for its supplies. Remmeber, the embargo on Japanese in oil and scrap iron led to Pearl Harbor within three years.
Henry
Tom Lehman wrote:
> Dear Henry and Rakesk,
>
> This is an interesting thread for me, because I am a potential casualty if some
> sort of balance isn't achieved in the world steel trade.
>
> I don't know if either one of you guys caught our international president
> George Becker on Cspan recently testifying before congress. George was very
> direct, "either we are going to have a steel industry in this country or we are
> not, simple as that."
>
> It is true that some industrialists could care less if the domestic steel
> industry is destroyed. Short term quick profit types. They forget what will
> happen in a few years when they need steel and it is unavailable to them at a
> reasonable price on the world market.
>
> Our domestic steel industry is the most efficient in the world. We have the
> best labor productivity in the world. It takes fewer man hours to make a ton
> of steel in the USA than anywhere else in the world!
>
> While writing this note the US mail came and I got a form letter from my
> congressman Sherrod Brown. Sherrod claims that steel imports have increased by
> almost 50% in the last year. He should know, he is on the Commerce Committee.
>
> Your email pal,
> Tom Lehman
>
> Rakesh Bhandari wrote:
>
> > Henry C K,
> >
> > Leading US mfgs want cheap foreign steel at the expense of American mfgs,
> > in particular Bethlehem, and American unions; you reason that therefore
> > the realities of inter-imperial rivalry, at the center of Lenin's and
> > Brenner's theory, have given way to international cooperation at the
> > expense of the nation or at least a complex international vertical
> > integration in which leading US MNCs (e.g. auto producers or Caterpiller)
> > make use of intermediate inputs from firms located in the NICs or Japan
> > (whose steel production doubtless makes complex use of the international
> > division of labor as well).
> >
> > Again, you see only one side of things. Yes, there is doubtless more use of
> > an international division of labor but this does not mean that these same
> > US MNCs do not find themselves in vicious world market competition with
> > their counterparts in Europe, Japan and to a lesser extent the NICs and
> > indeed because of that (intensified world market competition among
> > nationally based multinationals) need the cheapest steel available. In
> > defending the interests of the capitalist class a whole, the state now must
> > make a decision which fraction or industries must be sacrificed so that US
> > capital as a whole can achieve the competitive superiority on the world
> > market that has become a matter of life and death given the crisis of
> > overproduction. The cannabilization of steel may be the price US capital
> > must pay to have a chance to survive slaughterous competition in the world
> > market.
> >
> > peace, rakesh