By Mike Lessiter — Manufacturer News
I was struck by the April 13 Wall Street Journal. Page 9 of the 12-page “Exchange” section had two stacked-up articles on America’s steel situation. First was an article on Japan’s Nippon Steel’s $14.1 billion deal to acquire U.S. Steel. Directly underneath it was another article on German steelmaker ThyssenKrupp’s plans to cut steelmaking jobs and capacity.
No one is happy about the fate of U.S. Steel, a 123-year-old industry icon. Included is the United Steelworkers union, suddenly fretting about the future of its 10,000 hourly workers. President Biden is showing concerns over a foreign entity’s ownership of a key industry so important to national security and infrastructure. I’ll admit it’s a legitimate concern and one that I dwelled on during the foundry industry’s rough days in the 1990s. I recall a specialized American tank part that could only be sourced via France, which brought concerns of what happens when that capacity was threatened. While it’s a last-ditch argument, one could say the same for ensuring the future of our farm equipment manufacturers, who so quickly changed their production facilities to help prior generations’ defense production needs.
That’s a rant I’ll take up another time.
Something else that got to me in that same Wall Street Journal edition was the front-page story on Amazon’s aggressiveness in all of the markets it competes in (which is to say anywhere a dollar is spent.) The article shared the famous quote by Amazon founder Jeff
Bezos at a 2006 gala that writer Dana Mattioli said included a list of attending retailers that “now reads like a bankruptcy docket.”
Bezos, standing in the bar, was asked what he was doing there. As legend has it, he uttered the words, “Your margin is my opportunity.” And 18 years later, he made good on his word.
“Your margin is my opportunity.” Let that sink in for a moment…
So why do we see U.S. Steel and ThyssenKrupp making doomsday headlines on the same day? And what do they have in common with the April 17 new out of Racine, Wisconsin? You know, that one-third of the CNH’s 660 workers are being laid off (and more to come if you believe the United Autoworkers and up-for-election senators like Tammy Baldwin). News of the layoff came 15 months after a new labor contract was awarded in January 2023 that ended a 9-month strike.
You didn’t ask me, but I’ll answer anyway, especially since the UAW is burrowing in on Volkswagen this week. The unionization of labor forces, at least during my time in the workplace, gets an F grade, and not just for their scandal and dishonesty. Here’s why:
- Labor unions have stopped technical innovation in its tracks for fears of a work force unprepared to do anything else (ask me about this one)