U.S. Steel – mackaycartoons

Wednesday August 24, 2016

August 23, 2016 by Graeme MacKay

By Graeme MacKay, The Hamilton Spectator – Wednesday August 24, 2016

Locals outraged at Ottawa’s “deafening silence” on steel industry

Union leaders, Opposition MPs and even the Chamber of Commerce are pressing the federal government to help Canada’s struggling steel industry.

Two Hamilton Members of Parliament, three chambers of commerce and union leaders at the local and provincial levels separately have called for help for the industry and especially for retirees and workers in Hamilton.

Thursday September 26, 2015

NDP MPs Scott Duvall (Hamilton Mountain) and Dave Christopherson (Hamilton Centre) have written to Economic Development Minister Navdeep Bains, saying the federal government has stayed on the sidelines too long.

“To date, your government has not been tangibly involved in any way to help protect the jobs, benefits and pensions of current and former employees of USSC/Stelco despite commitments previously made by colleagues and the Prime Minister” they wrote. “Workers, pensioners, the business community and the City of Hamilton have all appealed for your help. So far, you and your government have been missing in action.”

As a start, they want the government to release the “secret deal” that ended a lawsuit against U.S. Steel for breaking the production and employment promises it made to get government approval for the acquisition.

They also back a call by the United Steelworkers union for a public inquiry into Canadian bankruptcy law they say favours creditors at the expense of workers and retirees, and the 2007 takeover of Stelco by U.S. Steel. Duvall has raised the issue in Parliament several times.

September 18, 2014

U.S. Steel Canada, the former Stelco, has been under creditor protection since Sept. 16, 2014. It is seeking a buyer for the mills in Hamilton and Nanticoke.

On the business front, chambers of commerce in Hamilton, Windsor and Sault Ste. Marie are taking a joint resolution to the Canadian chamber’s national convention calling for a policy to protect the industry from unfair foreign competition.

Friday October 9, 2015

“The biggest issue for us is dumping from China,” said Hamilton Chamber of Commerce president Keanin Loomis. “Obviously there’s a real issue of fairness there.”

Products are dumped in foreign markets when they are sold for less than their costs of production or with subsidies from a government.

“What we want is a level playing field in the global production and procurement process,” added Rory Ring, executive director of the Sault chamber. “We’re competing against companies that are either government owned or that operate with less than reasonable environmental and labour laws.” (Source: Hamilton Spectator)

Friday October 9, 2015

October 8, 2015 by Graeme MacKay

By Graeme MacKay, Editorial Cartoonist, The Hamilton Spectator – Friday October 9, 2015

Decision on U.S. Steel Canada benefit, tax cuts Friday

The judge presiding over U.S. Steel Canada restructuring hearings says he will render a decision Friday on a controversial plan to sever the subsidiary from its parent company and relieve it of tens of millions of dollars in pension benefit and municipal tax obligations.

Justice Herman J. Wilton-Siegel said it is one of the toughest decisions he has had to make from the bench. He said he will give a short written summary of his decision tomorrow and then follow it up with a detailed explanation next week.

Dozens of USSC retirees bused into Toronto again today and packed the courtroom where lawyers representing stakeholders gave their final submissions.

A lawyer for the steelmaker reiterated the company’s position that USSC was a victim of circumstances and changing market conditions that turned the business into a crisis requiring the difficult measures of the transition agreement.

Pension benefit obligations were estimated to be $40 million before the end of this year and the company does not have the funds, he said.

He refuted arguments from United Steelworkers lawyers that savings could be found elsewhere — making the pension benefit hit unnecessary — and that the company’s grim fortunes were the result of steel orders being moved from the Canadian subsidiary to other U.S. Steel operations.

United Steelworkers 1005 President Gary Howe said after the hearing that he expects the judge to go along with the company plan because it has the backing of the monitor overseeing the proceedings. In its most recent statement, the monitor said “a near-term cessation of operations will be necessary” if the company plan isn’t accepted. (Source: Hamilton Spectator)

Thursday September 26, 2015

September 24, 2015 by Graeme MacKay

By Graeme MacKay, Editorial Cartoonist, The Hamilton Spectator – Thursday September 26, 2015

Dispute over U.S. Steel Canada restructuring sent to mediation

The dispute between United States Steel Corp. and its stakeholders over the future of U.S. Steel Canada Inc., has been sent to mediation by the Ontario Superior Court judge overseeing the Canadian unit’s restructuring.

The issues in dispute between the United Steelworkers union, the Ontario government, salaried active and retired employees, and a former president of its predecessor company Stelco Inc. on one side and U.S. Steel on the other, will be examined by former Ontario Superior Court associate chief justice Douglas Cunningham in a three-day session scheduled to begin next week.

“The mediation shall address the feasibility of a comprehensive agreement among the parties,” Justice Herman Wilton-Siegel said in an order. The mediation will also address a business plan for the Canadian unit, its potential sale, the shift of production of high value-added steel to the United States and U.S. Steel’s claim of more than $2-billion against the Canadian unit.

U.S. Steel Canada has been operating under the Companies’ Creditors Arrangement Act since last September, but the announcement by its parent company that it plans to shift production of about 180,000 tons of high-quality steel annually out of its Canadian operations has sparked an imminent crisis in the restructuring.

Shifting production would diminish the value of the Canadian assets in the eyes of potential buyers, steel industry sources said. U.S. Steel has started a sales process that has led to a bid by one competitor – Essar Steel Algoma Inc., which is based in Sault Ste. Marie, Ont., but has the backing of a deep-pocketed parent company in India.

Potential buyers also need to wonder whether other steel-making contracts will be shifted out of Canada, leaving the Canadian operations to depend entirely on the spot steel market.

Stakeholders have questioned whether U.S. Steel actually wants to sell U.S. Steel Canada – it has also bid for the assets – or use the restructuring process to avoid a pension liability of more than $800-million and an unknown environmental liability at the Hamilton site, where steel has been made for more than 100 years.

“The worst-case scenario is that they want to mothball everything, pick up the pieces and leave and not have any liability,” said one source.

U.S. Steel bought Stelco Inc. in 2007. Stelco had undergone a two-year CCAA process that led to its purchase by a group of investment funds.

But U.S. Steel’s history in Canada has been one of confrontation. The company locked out unionized workers in Hamilton and Nanticoke, Ont., during three of four sets of contract negotiations and broke commitments made to the federal government when Ottawa approved the purchase of Stelco under the Investment Canada Act.

U.S. Steel said it was forced to halt steel production in Canada because of the recession, but the broken promises led to the first prosecution of a company under the Investment Canada Act.

That legal dispute was eventually settled, but U.S. Steel and the federal government have refused to release details of the settlement and Judge Wilton-Siegel denied requests by the union and other stakeholders that the agreement be made public. (Source: Globe & Mail)

Thursday September 18, 2014

September 17, 2014 by Graeme MacKay

By Graeme MacKay, The Hamilton Spectator – Thursday September 18, 2014

U.S. Steel Canada files for bankruptcy protection

U.S. Steel Canada is under court-ordered protection from its creditors.

The move, announced Tuesday, sat well with investors on U.S. markets on Wednesday. U.S. Steel was up 12 percent at $46.34 at 9:04 a.m. in New York. The stock (X:US) gained 40 percent this year through Tuesday’s close, Bloomberg reported.

In announcing the move, the company’s American parent said the Hamilton and Nanticoke plants have lost more than $2.4 billion over the last five years and the bleeding has to stop.

Michael McQuade, president and general manager of the former Stelco, said in a statement that financial restructuring is the only way to improving chances for the future.

“Despite substantial efforts over the past several years to make U.S. Steel Canada profitable, it is clear that restructuring … is critical to improving our long-term business outlook,” he said.

Canadian spokesperson Trevor Harris said it will be “business as usual and status quo for the time being” as restructuring negotiations get started.

The news release from the parent company noted pension costs as one of its major hurdles, saying the Canadian operation accounts for about $1 billion of its employee benefits liability. For 15,000 pensioners, that is a warning they could lose a chunk of their retirement income.

Pensioners would be out of pocket if the company wound up its Canadian pension plans in the current underfunded state. Some estimates have said that loss could be as high as 30 per cent.

That pension statement echoes claims Stelco made in 2004, when it sought protection under the Companies Creditors Arrangements Act (CCAA) saying the cost of topping up its badly under-funded pension plans was driving it out of business. (Source: Hamilton Spectator)

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