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Steel, Not Steal

20 January 2011

On November 7th, nine hundred steel workers were locked out of their Hamilton plant by US Steel Canada, formerly Stelco Inc. These workers have not been officially laid off and therefore do not qualify for Unemployment Insurance. Since they are not on strike, they do not qualify for strike pay, though their union, Canadian Steelworkers, Local 1005, pay them $200 per week.

United States Steel Corporation bought Stelco for $1.9 billion on October 31st., 2007. At first, all seemed well (or as well as it can be under capitalism). Then John Surma, CEO of US Steel, was appointed to President Obama's Advisory Committee for Trade Policy. Last September, the Hamilton plant shut down its blast furnace. The union saw this as a step to what eventually happened - lockout. Local 1005 president, Rolf Gerstenberger, insists that shutting down the Hamilton plant potentially means another $2 million in steel exports to Canada, That's what really grates on us - that they can shut down and supply the steel from the US." (Toronto Star, Dec 11). Though it probably wasn't the merriest Christmas for the steelworkers, their bosses will save money by not paying them for the holidays.

To complicate matters, the United Steelworkers International President, Leo Gerard, a Canadian who lives in Pittsburgh, is also on Obama's committee - there's nothing like solidarity forever. Though the steel industry, like capitalism everywhere, has been in a slump, Canadian workers say they should have the same percentage of work as their American counterparts. Their cause has been taken up by those champions of the oppressed, the federal government. Industry minister, Tony Clement, has taken US Steel to federal court for failure to abide by the employment and production commitments they agreed to under the Investments Canada Act, 2007.

By March, 2009, job losses totaled 2 190 at US Steel plants in Hamilton and Nanticoke. As Clement said then, " I remain of the view that US Steel is not complying with its undertaking, and I am not satisfied by its explanations for non-compliance. Ottawa can't just roll over and let potential foreign investors think they can make and break promises." Gerstenberger said that had the union accepted the company's final offer before the lockout, it would have taken away indexing for 9 000 pensioners at the Hamilton plant as well as creating a two-tiered pension scheme without defined benefits for new employees. He said, "Oh, it's not like that in the states. They want to strip away what it's taken us fifty years to build in Canada. If we were to agree, this would be the end of the union…everybody knows the company would be a real jewel in anybody's crown if it didn't have to pay 9 000 pensioners."(Toronto Star, Dec. 11). Of the 9 000 pensioners, the bottom 3 000 earn between $300 and $1 000 monthly with indexing, 78 per cent of whom are widows.

The steelworkers have some support, for what it's worth. The Hamilton City Council passed a resolution recently calling on the company to 'restart the blast furnace immediately.' Ontario Premier, Dalton Mcguinty, met with the steelworkers recently and told them the provincial government has mediators available to help reach a negotiated settlement. Perhaps no one summed it up better than an anonymous steelworker who said, " This foreign monopoly is using the blackmail of being locked out for months, especially in the winter cold, to extort concessions." With feelings aroused it was only a matter of time before racism reared its ugly head. At union headquarters there is a placard saying, "Yankee Go Home!" According to steelworker, Mike Murphy, " If you think you've got a future and it all falls apart on you, man, it's discouraging. You know it doesn't look it, but, historically, this used to be a great place to live and work." Murphy's comment is further testament to the fact that within capitalism, there is no security. When there is a buoyant economy, so many think it will last and have their illusions shattered later. For many that later is now!

US Steel's management has been tight-lipped about the whole deal. Their spokeswoman, Courtney Boone in Pittsburgh, advised reporters to direct questions to their media representative in Canada, Trevor Harris. He didn't return any phone calls. Whether the company decided on a lockout to force unions to concede on pensions or to force Canadians to buy steel produced in the US, isn't abundantly clear. However, one thing that is very clear is that whichever course of action the steelworkers pursue, in this matter they will be the ones to suffer. One might argue that if the Hamilton plant was up and running, the US steelworkers might suffer since Canadians would buy less steel from them. If this is a credible viewpoint, it merely emphasizes what a ridiculous situation it is, but given that the fundamentals of capitalist production are ridiculous, not surprising. All parties involved have a point of view, which, within the general contradictions of capitalism, make sense to them. The Hamilton City Council wants the plant up and running so its employees can patronize local businesses. The Ontario and Canadian governments want it running so that Canadian industry can export steel to the US and elsewhere. As for the Investments Canada Act, history has shown that agreements between capitalists and politicians, who attempt to administer capitalism, are merely pieces of paper to be ignored when it doesn't suit the needs of either party, the Molotov-Ribbentrop Pact being a perfect example.

The management of US Steel wants to cut pension payments, not because they are miserable, heartless bastards, but because in hard times capitalists look for ways to cut expenses and save profits. It's the bitter reality of capitalist economics. President Obama has said he will revitalize US industry, which means keeping as much production as possible with in the US. American businesses want to export products to Canada, not import them. One may wonder why a company will buy a plant for $1.9 billion only to shut it down. Seen from a long-term point of view, they will recoup their losses and then make money on the deal. As for the locked-out steel workers, their interest is obvious - food, shelter, clothing. Obviously, US Steel's management is in no hurry to resume production.

The union's failure to break the deadlock justifies the viewpoint of the Socialist Party of Canada and its companion parties in the World Socialist Movement, - that unions are most effective when the economy is going through a boom period and the demand for labour is high. Otherwise unions can only fight a rearguard action against the worst excesses of capitalism. They try to improve conditions for their members within capitalism in the form of higher wages, less hours, better overtime rates, sick pay, pension plans, safety legislation, etc., but can never be a means to establish socialism. Nor can it be argued that workers in unions can capture the tools of production within capitalism, thereby creating a new society within the womb of the old, which Industrial Workers of the World (IWW) advocate. For a union to be effective, it must embrace workers of all political beliefs in its ranks, including reformers, liberal, conservatives, and fascists - hardly an organization that will change anything fundamentally. The above is further evidence, if any is needed, that capitalism cannot be made to work in everyone's interest. Benefits won by years of union activity and strife can be lost in the blink of an eye, as we see here. This doesn't mean there is no solution to the problem. In fact, the solution exists and can be implemented as soon as most people decide we need a complete change. It'd called socialism - common ownership by all and free access for all to the products of society - and to establish it we need to work politically for its speedy arrival.

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