Bethlehem Steel
Posted by Bradleytank 12 years, 4 months ago to Business
As I drive by my old customer Bethlehem Steel... I question who is left in American manufacturing. The fragmented manufacturing and specialization has created a void. A cloud of regulations and tax law have economically engineered an economic storm equilivant to a nuclear winter.
The greatest sight I have ever observed is the pouring of molten metal. Tapping a blast furnace, pouring steel into a torpedo car or pouring a ladle into a tundish with all the splashes and sparks is an unbelievable experience. Of course, I also get off pushing coke (no, cot that kind) out of a Koppers-Becker chemical recovery oven, but that's just me!
I agree, molten steel is something to behold. In my PoW post, that is the business I would love to own.
1. Wealth is created by 5 simple long term items or situations. Land, improvements to land, resources, value added through manufacture, and intellectual property. That's not me, it's from Funk and Wagnel's. Checking the above paragraph you will see that for many years we, as a Nation, utilized both resources and value added through manufacturing to create immense wealth. The moment our gov't decided to encourage the service economy and export labor (chiefly through tax policy) we became a debtor nation. This is because we now, and for years, consume more than we produce. At the same time this shift leaves behind roughly 1/3 of our population. 40 years ago these people. for the most part, had jobs that paid them very well for the skill sets they had. They paid taxes, paid union dues in some cases, bought homes, went to Kroger every week, had a family, and prospered. Now about 1/3 of the US population does not participate in the labor force. They are dependents of the state in one way or another. This adds to the debtor nation status. We not only consume more than we produce, we borrow money to pay for the things those unable to find work need. "We are our brother's keeper." It's the right thing to do, or maybe "it's fair!"
2. Wealth has a lasting value, or intrinsic value. Look carefully at the service industries. Does a stock broker or banker add value to what he produces or do they simply rearrange the papers? Each of us use some sort of tax service every year. Last year my tax return was 95 pages long. While I deeply appreciate the knowledge my tax professional has, what is the intrinsic value of those 95 pages on April 16th? How much is a haircut worth in 4 weeks? While it is convenient to have a valet park my car, I'm not sure he makes the trip downtown worth more.
My point is to have a thriving economy takes more than the service industries. Someone actually has to get their hands dirty creating wealth. I imagine it takes government for infrastructure, manufacturing, and services to create a 3 legged stool for the economy to sit on. Take away, or damage any leg and it makes thing pretty uncomfortable.
3. Jobs trickle down, but wealth percolates up. It's true, the rich get richer, but consider this. The higher laborers climb the economic ladder the more wealthy they become. With persistence they reach a point where their assets earn enough they shall never have to labor again, which is another characteristic of wealth. Being rich is a 6 figure executive job with perks. It's great. But when two companies merge and only need one management team, that is a very shallow job pool to navigate. On the other hand, being wealthy means it's OK to take the month off because the cash flow just keeps coming. It's not related to effort, it's wealth.
Somehow in the telling and reliving of the "Robin Hood" tale America has lost it's way. I find it interesting that Robin Hood is so closely spelled to Robbin' Hood, which is a street thug. I guess the original Robin Hood was a Sherwood Forest thug! The problem with the story is the rich guy will simply avoid Sherwood Forest, rather than be robbed by the mouches (Hoods). They may get travelers cheques from the Templars or Dominicis or they may go by another route. In modern America we have international corporations leaving profits offshore rather than be scalped by our Presidential Barber. I've noticed that everyone gets a haircut except the ones that need to be cut back!
Finally, nobody I know wants dirty water or smokey air. But just as the county building inspector tells a builder what is needed for a given structure, it seems to me that the EPA could say if you're going to build a refinery...do it this way. The same for factory, pipeline, or any other needed addition. What we have today is a stone wall that values minnows more than the San Joaquin Valley farmers and turtles more than oil pipelines. In that regard, we deserve the economy we have allowed to be hijacked. Since this is the AS forum I would add this. Many of us have created our own gulch and refuse to do one thing more until the government ceases to punish thoughtful accomplishment and reward careless neglect. In my case, I don't have to be another Donald Trump, I just have to have enough assets to support my lifestyle, lay my taxes off on one or two of the tenants, and enjoy the fine car they provide for me. Why should I do one thing more for them to take away?
factories or pipelines? Looking at the EPA Abuse
web site they have done enough damage to our
economy. I'd trust a civil engineer way before an EPA bureaucrat.
bureaucrat
It is a sad state of affairs. It is a scene much like many parts of my neck of the woods around Detroit... they look like something straight out of AS. Soon there will be no industry at all if things aren't changed.
I like your screen name. I have produced many military components, some for the successors of the Bradley Tank...
Respectfully,
O.A.
All of that is progress what we need is to create about 30 million careers. Jobs are OK, but what we really need is economic ladders for each segment of the population to climb. If everyone that wanted a career could have one and climb up out of the poverty trap, then selfish capitalism would have lifted more people up than LBJ's war on poverty ever has. The political problem with work is that it's delayed gratification rather than the instant thrill of spending your EBT card.
Once we did this by Revolution, but now they have the guns. We'd lose. So, the only route is by trying to hold things together until we can get ever more "Believers" into Congress and hope we make it in time. Otherwise, we will have lost and can expect to be renamed "The United States of Communism".
While I worked there, a large suspension bridge was built over the Houston Ship Channel about 4 miles away from the bridge. The large amount of steel required for this bridge could have very easily provided by US Steel or Bethlehem Steel. But, for some reason the steel was shipped from South Africa.
Why could this steel not have been provided from an American Company? Taxes, regulations, free trade? Whatever reason it is unacceptable.
Our government should promote our manufacturing, not work to destroy it.
The current generation are coming out of school with shiny specialization degrees, or no degree and no training. A wise professor once defined specialization as, "Knowing more and more about less and less." Pretty much fits. We are no longer a nation of well rounded individuals. One company had 200 openings in their IT business, but could not fill them. Today's computer geeks apparently could not relate to the people they were serving. They knew nothing of the fields for which they would program computers, had limited skills in communication and conversation, and lacked a desire to care about any of it. Customer service is an overlooked factor in the success of a business, and that skill is going down the tubes in this country. Read Amazon customer posts about products - they will not be repeat customers of a brand when they have had a bad customer service experience.Kids have no practical hands on skills today, with the exception of a few vocational schools, leaving them qualified for little more than McDonald's when they graduate.Actually, maybe not even that, as some cannot even mop the floor without laving a lake for customers to fall on.
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The expansion on a mountainside had to be creative and differ greatly from a build to suit opportunity of new competitors.
I think the montra my father taught me
Constantly compete with yourself to improve, it will guarantee your competitors the strongest foe.
Creation is an act of love.
http://www.youtube.com/watch?v=vcEOsGvT0...
Now I do not doubt that the labor costs due to unionization and mismanagement also played a part, but one should not ignore the simple market forces of improved technology on an industry with such a high capital investment cost.
"The Rise and Fall of the Steel Industry", Wall Street Journal. coaldigger. 1997.
:)
Bethlehem Steel was a grand old company and a
customer of the NY company I worked for long ago.
No doubt, our gvt is guilty of helping B.S. falter,
as was the cheaper cost of 'rolled steel' from the
Netherlands, I do believe. That was around 1970.
"The stock market crash of 1929 finished off what years of wanton spending had started. He spent his last years in a small apartment. He could no longer afford the taxes on "Riverside" and it was seized by creditors. He had offered to sell the mansion at a huge loss but there were no takers. At his death ten years later, Schwab's holdings in Bethlehem Steel were virtually worthless, and he was over US$300,000 in debt. Had he lived a few more years, he would have seen his fortunes restored when Bethlehem Steel was flooded with orders for war material."
I am thinking about the Military-Industrial Complex. Need profits...