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Steel vs. Wheels

Mary Tice's New Cumberland, West Virginia, home is difficult for a stranger to find. It rests at the top of a winding mountain road, down a long, unmarked driveway next to an empty, detached garage. Her kitchen is warm and cozy, with ornaments, a refrigerator door covered by tiny family photos, and, along a far wall, there is a half table with candy, soda, and two chairs. She sits on one chair and offers the other to me.

Her two dogs wander the house, aggressively sniffing out visitors. Her living room wall still holds her wedding pictures from three decades ago.

According to Tice, she was – and, in some ways, still is – the "typical steel wife". "My husband worked six days a week or he worked seven days a week," Tice said. She said she and her husband Larry "loved each other deeply", but that his job was consuming him.

"He wanted his pension. He wanted to retire. He was told, `Y'know, you work hard, you take care of your family – you'll survive. Everything will be fine," Tice recalled.

Downturns in the industry caused hard times for Larry Tice's employer, Weirton Steel. Layoffs loomed. Pensions were jeopardized. Mary Tice said on the day her husband learned he might lose his pension, he called her at work and said, `I screwed up.' Unsure of what he meant, she said she asked for an explanation, but didn't get one. She tried calling back, but Larry didn't answer. Mary Tice said she asked her employer, a Weirton chiropractor, for permission to leave and rush home. When she got there, Mary found Larry dead on their living room floor. He'd shot himself through the heart with a handgun he'd kept in the bedroom.

Tice's story is a dramatic example of the hard times that have fallen on the Ohio and West Virginia steel industry. Shuttered plants have triggered mass layoffs. Workers are furloughed. Mortgage bills are unpaid. Many of the buildings along the once vibrant Route 2 in Weirton are now abandoned. "For Sale" signs grow rusty in several neighborhoods, including the one nearest Tice's home. The Weirton steel plant, which former workers say used to employ more than 10,000 people, is down to just a fraction of its former workforce.

This struggling industry is about to suffer another economic blow. The International Trade Commission has removed tariffs on foreign galvanized steel. The decision will allow U.S. automakers – one of the steel industry's most reliable and important customers – to buy more of their steel products from other countries.

This, in turn, jeopardizes U.S. steelmakers, the future of their products, and the future of their operations in America. The Commission's ruling was a highly controversial one because it benefits one beleaguered industry at the expense of another.

"Why do people in Washington think we're doing so well? We're not," said Democrat U.S. Representative Charlie Wilson, who represents Ohio's steel-heavy 6th Congressional district.

"I drive by idle steel plants all the time. I talk to my friends in the steel industry and they're not doing well, Rep. Wilson, who also owns small businesses in Bridgeport, Ohio, said, "They're not flourishing."

He said the Trade Commission erred by underestimating the competition posed to American steel products by foreign steel manufacturers.

Outside the U.S. Steel mill in Clairton, Pennsylvania, workers congregated in a brick union hall, behind collapsible conference tables, to talk about the Commission's ruling while snacking on pretzels and hard candy.

Calvin Croftcheck, head of the local steel union, said, "Of course, it's a major threat to us. The domestic automakers aren't doing very well – and we understand that."

"But I guess the problem I have with this is when (automakers) say they're going to produce their product cheaper now," Croftcheck said, "When have you ever known them to reduce the price of an automobile? It's never happened in my lifetime."

As expected, automotive workers and their federal representatives cheered the ITC decision.

Rep. Mike Rogers, a four-term Republican who represents Lansing, the capital of the Big 3 Automakers home state of Michigan, said, "If you're going to have a robust steel producing industry, you have to have a robust steel consuming industry."

Rep. Rogers said Michigan has hemorrhaged jobs – tens of thousands of jobs – in recent years because of slumps in the domestic auto industry. The Congressman said the ruling will allow more automakers to move, or move back, to the U.S.

"When the tariffs were in place, automakers moved to foreign countries to produce their parts. Why? Because the steel was cheaper there," Rep. Rogers said. "Now those companies can move back to Michigan and still get their steel."

Rep. Rogers and his Georgia colleague, Republican Congressman Tom Price, both said the steel industry is partly to blame for its own difficulties.

"What happened for years and years is the steel companies never invested in new technology and efficient production. Now they're at the point where they're uncompetitive," Rep. Rogers said. Rep. Price said the steel industry must now take "greater innovation" to compete.

The automotive industry is no stranger to foreign competition itself. For years Honda, Toyota, Nissan, and other international companies have eroded the U.S. auto industry's once rock solid customer base. Auto towns like Detroit, Lansing, Flint, and Lorain, Ohio suffer from soaring unemployment.

In a small, deteriorating neighborhood on the southside of Dayton – a community lined by boarded up homes and lawns littered with broken furniture – sits a massive slab of concrete that was once home to a bustling Delphi plant. In its glory days, the plant employed thousands of middle-class workers and produced parts for scores of General Motors' vehicle brands.

The plant, once the largest structure along Wisconsin Boulevard, was ultimately demolished. Joe Buckley, a 30-year Delphi employee, still works in the neighborhood as head of a local auto workers' union. His small office building is adjoined by a parking lot, which is dotted by white "Buy an American car, Save a Job" signs. Buckley said American auto workers are at the mercy of American trade deals, including rules regarding tariffs.

"China, the Philippines, all these places have cheap labor. We can't compete against poverty level wages," Buckley said.

In Springboro, Ohio, a Dayton suburb in which new housing is quickly sprouting, Delphi retiree Rick Tincher is concerned about making his "hefty mortgage payments." Tincher, says his retirement was "forced", because of Delphi's decision to shut a Warren County Ohio facility and move it to Juarez, Mexico. He says favorable trade rulings prevent more auto jobs from speeding south of the border.

"For a C.E.O. to do a good job, it's not about growing the business. It's about how can he buy the products to manufacture cheaper," Tincher said.

Jim Bouchard, chief executive of Wheeling-Pittsburgh Steel, says the ITC's decision will almost certainly do just that -- lower the price of this corrosive-resistant steel and lower the costs for auto manufacturers. Bouchard, who walks the grounds of his Mingo Junction steel plant wearing a sweater, denim jeans, and a hardhat, said, "(Those lower prices) will basically cut the legs off of the American steel makers and their workers."

Auto and steel workers are now in a thorny situation. Longtime allies – both economically and politically – are now fighting against each other. Walter Danna, who worked for Weirton Steel from 1964 to 1995, admits many of his friends in the steel business are no longer buying American cars. Danna, a husky man whose booming voice only accentuates the anger of his words, harshly criticized the auto unions who lobbied for the rule change.

"Basically, they believe, `What's good for me is good me. And to heck on you", Danna said. "If we did that we'd be the villains wouldn't we? We wouldn't be the big brothers, we'd be the bad brothers."

Mary Tice said she has no reaction to these developments in the steel industry. Her husband's suicide has fully separated her from the stress and strain which the industry imposed on her life for 30 years.

But she said the steelworker families, with whom she's still friends, are now "beyond pessimistic."

"Everybody has lost faith. Lost faith and lost hope of any kind," Tice said.

Delphi Automotive refused our requests to interview its management. The new ruling, which was made over the holidays, takes effect immediately. The tariffs had been in place for 13 years, and affected corrosive-resistant steel made in 16 countries. On the heels of the ITC decision, analysts say some automakers will likely change their steel purchases immediately. In recent days, Pennsylvania steelmaker U.S. Steel estimated its profits will slip in the 1st quarter of 2007.

The ultimate economic and social ramifications of the ruling have yet to be determined. Steel communities like Clairton, Johnstown, Steubenville, Ohio, and Wheeling, WV – as well as auto communities like Dayton, Detroit, Lansing, and Toledo -- are already fighting for economic survival. Now they're also fighting each other.

-Scott MacFarlane, NEWS9

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