Word: weirton
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Dates: during 1980-1989
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...coordination" program would almost surely increase protectionism and unwarranted subsidies. Said he: "A Government agency that explicitly tries to sit there and say, 'The cotton industry can live but the wool-textile industry will die' or 'The Youngstown steel plant can be rehabilitated but the Weirton plant must close' will be a terrible mistake." The invisible hand of the free market, Schultze said, should make the decisions about industrial structure, even though the "choices will be imperfect...
...debt burden may be less onerous than it sounds. Under the laws covering the formation of companies owned by employees, payments of principal on debt (as well as interest) are deductible from income for tax purposes. Even so, the purchase is far from a free lunch for the Weirton workers. McKinsey's analysis of the Weirton operation concluded that the plant could be profitable, but only if the workers would accept a 32% cut in total compensation; annual salaries and benefits average $35,000 to $40,000, high by comparison with the rest of the steel industry. Says...
National's stock has climbed almost $10, to $23, since the buyout began to look promising last year. Most security analysts view the deal as favorable for National, the fourth largest steel producer in the U.S. Closing Weirton would have saddled the company with $180 million in pension costs, according to one study. About one-third of the workers started with the company at least 30 years ago, which makes them eligible for full retirement benefits. They have chosen to stay on the job anyway. To induce them to vote for the plan, National will assume all pension costs...
...sure Weirton will survive under new ownership, and that naturally makes some of the workers edgy. "I'm not saying the plan is going to fail," says Blacksmith Thomas Troia, 57, whose father and four brothers have worked at Weirton. "It may be a perfect thing. But you don't know. You have to go with what you have, not with what may be. I imagine there will be a lot of older fellows going...
...record of some employee-owned corporations is not altogether reassuring. More than 500 U.S. companies are largely or wholly owned by employees. About 50 or 60 of them, like Weirton, were on the verge of being closed down when they were bought out. Among the largest in recent years have been Rath Packing Co. in Waterloo, Iowa, with sales of $435 million, and bearing maker Hyatt Clark Industries in New Jersey, which had sales of $66 million in its first ten months under employee ownership. Both companies lost money last year. But Corey Rosen, executive director of the National Center...