In lieu of an abstract, here is a brief excerpt of the content:

Chapter 14 The New U.S. Steel U.S. Steel had a good year—not a great year—in 1984. The company reversed its $1 billion loss from the previous year into a nearly $500 million income. The downward trend in overall sales also was reversed, as was income recorded for each of U.S. Steel’s industry sectors. The steel sector rebounded from its $610 million loss in 1983 to earnings of $142 million in 1984. But oil and gas income continued to outpace steel by a wide margin. The nearly $1.3 billion oil and gas earnings topped both the 1983 and 1982 income levels for that sector. U.S. Steel crowed about its accomplishments in its 1984 annual report, remarking that a “New U.S. Steel came into its own in 1984.” Noting how the transformation had occurred, the report went on to say that “our Oil and Gas segment [or sector] is now our major line of business in terms of both revenues and earnings,” but that steel “remains a substantial part of our profile.” The long-range strategic plan that had brought U.S. Steel to this point and that now would move it into the future had been disclosed in bits and pieces over the last few years, but not until 1984 was the plan stated publicly in such succinct, point-by-point fashion. Several of the items in the company’s ninefold plan had particular bearing on the future of steel and coal production. Among the company’s stated objectives were the following: We intend to achieve optimum performance from all operations; When we identify obsolescence, we will shrink operations accordingly. What can be modernized will be, and what is not process-competitive will be closed; We will be a highly selective steel producer. Our emphasis is on what sells—and what sells better because of our special expertise. We will only produce what is economically justifiable; When assets are not considered part of our longrange plan and are worth more to others than they are to us, we will divest them—to our ultimate benefit. We have 180 The New U.S. Steel done so successfully, and we will continue to do so as opportunities arise. We are also open to future acquisitions when business conditions are favorable and we identify opportunities; We will treat each of our lines of business as a business —and as the very kind of business it is, deriving the most advantage from our diversity within corporate unity.1 U.S. Steel’s top-heavy reliance on its oil and gas sector continued paying off in 1984. While the price of a barrel of crude oil declined slightly from 1983, the drop was far less dramatic than the more than two dollar drop from 1982 to 1983.2 Countering that drop was the income produced by oil that now had been pumped from Marathon’s South Brae field for an entire year. Some cost-cutting moves and improved sales of oilfield equipment also helped boost the oil and gas sector’s overall bottom line.3 The asset redeployment component of U.S. Steel’s strategic plan was lumbering on unabated. By 1984 the company operated only two of its twenty-five Mon Valley blast furnaces that were in operation shortly after World War II.4 Plant closures were among the most significant reasons that U.S. Steel had returned to profitability in 1984. However upbeat the profit-and-loss statement might have been, though, the loss of steelworker jobs that had contributed to the economic turnaround had taken its toll. Protests that had become more vocal in 1983 turned ugly in 1984. Protestors said to be representing steelworkers interrupted church services to publicize the plight of the unemployed and even reportedly phoned death threats to U.S. Steel executives and their families.5 Protestors who often acted alone began to organize in 1984. Two groups in particular emerged during the year. One was the Network to Save the Mon/Ohio Valley, comprised of about five hundred unemployed steelworkers and militant union leaders. The other consisted of about twenty-five clergymen organized into what they called the Denominational Ministry Strategy. Both groups aimed their protests at U.S. Steel and the Mellon Bank. Neither of these two, according to group spokespersons, was doing enough to assist the nearly 20,000 steel plant workers who had lost their jobs since U.S. Steel began closing its Mon Valley plants...

Share