The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Bankruptcy Blackmail:
The steel companies are on the roll

Nov 3, 2003

The same day Rouge Industries filed for Chapter 11 bankruptcy protection, Russia's second largest steel producer, Severstal, announced it had reached an agreement to buy the steel-making operation within the giant Ford Rouge complex in Dearborn, Michigan.

UAW leaders representing a couple thousand workers at Rouge Steel announced they had agreed to discuss a new labor contract as part of the reorganization. A few days later, the chairman and CEO of U.S. Steel Corp. said it was still interested in buying Rouge Steel in bankruptcy court proceedings: "We want to see what opportunities exist. It's just the beginning of the game..."

It's just the beginning of the game all right, the bankruptcy game that is stacked against the workers. Declaring bankruptcy supposedly means you don't pay your debts, but it's not true. Rouge Industries isn't going to stop paying its debts to suppliers. If it did, it couldn't continue to produce. Yet the same day it filed for bankruptcy, company officials announced that Rouge Steel will continue to provide uninterrupted service to its customers.

No, bankruptcy is directed against the workers as a threat to get them to accept big concessions, rather than risk having their pensions junked, like National Steel workers had in the Detroit area.

The president of the UAW local representing the Rouge Steel workers said that the steel operation is in "serious financial straights" and "something had to be done."

But IF this is the case, it isn't Rouge Steel workers that should be responsible for doing it. For 66 of its 80 year existence, Rouge Steel was owned, lock, stock and barrel, by Ford Motor Company. Even today, effectively it is a creation of Ford Motor Company, for whom it supplies most of its steel.

Over the years, Ford TOOK OUT all the profits it has made throughout the Rouge, steel operations included, and didn't invest in the maintenance, the modernization that it should have. Not even the minimal maintenance, as Rouge workers can swear to.

The money has been there – to keep the steel operations modernized. But over the years, it has been drained out of the Rouge. Now they want to come to the steel workers for more. This cycle of concessions has got to stop!