FATE OR FOLLY? Was Black Monday inevitable? Panelists disagree

By DON SHILLING

VINDICATOR BUSINESS EDITOR

YOUNGSTOWN — Judge Diane Vettori recalls visiting the Henry Ford Museum in Michigan in 1975.

Her father, who worked at Youngstown Sheet & Tube Co., looked at an exhibit on steel making in the 1800s and remarked, “The problem is that’s still how we make steel in Youngstown.”

Black Monday struck two years later and her father lost his job. So did about 5,000 others as Sheet & Tube announced the closing of its Campbell Works and the relocation of its corporate headquarters.

The event Sept. 19, 1977, was marked Wednesday as nearly 200 people who attended a program at the Youngstown Historical Center.

Judge Vettori’s observation during a public comment period framed a key question of the evening: Were the closings of local steel mills inevitable?

“It was inevitable,” said a panelist, William Farragher, who was director of marketing communications for Sheet & Tube. “It was coming down the track for a long time. When it hit, there wasn’t anything anyone could do.”

Why it happened

Iron ore and coal, key ingredients in steel making, were largely gone from the area, he said. Ore was being shipped in from overseas, which was expensive, he said.

Local mills were landlocked and had to rely on rail and truck for shipments, he said. Competitors along the East Coast and Great Lakes used less-expensive water routes.

Farragher added that Japanese mills were using electric arc furnaces to melt scrap into steel. New competitors could produce small batches of steel to meet a new demand in industry — just-in-time delivery.

Still, the Youngstown mills were profitable and they had a work force that was more productive than Sheet & Tube’s plants in Indiana, he said.

But for decades, Sheet & Tube shareholders were looking to get their money out of the company, he said. It finally happened in 1969 when the company was sold to Lykes Corp. of New Orleans. Eventually, Sheet & Tube lost its longtime executives who were committed to local mills.

Looking at those facts, Gerald Dickey, a union official at the company’s Brier Hill works in 1977, reaches a different conclusion on the closings.

“It wasn’t inevitable. It didn’t have to happen. It was a man-made thing,” he said.

It was man-made because the mills weren’t modernized, he said. He said plans had been developed to install a basic oxygen furnace at Sheet & Tube to replace an open hearth but it wasn’t approved.

Compare that with the former Republic Steel Corp. mill in Warren, which now survives as WCI Steel. A basic oxygen furnace was installed in 1965 and a continuous caster in 1990.

Plan was developed

Staughton Lynd, a lawyer who was involved in efforts to restart the Campbell Works, said the local superintendent for U.S. Steel developed a plan to build an electric arc furnace to modernize the company’s McDonald Works. It was never acted on.

Lynd said a local mill could have been bought for $20 million at the time but it would have cost $200 million to modernize. That was much more than a federal loan guarantee program had available, so the federal government rejected funding for a local effort to restart the Campbell Works in 1979.

The Ecumenical Coalition of the Mahoning Valley didn’t get the funding but it didn’t fail, said the Rev. Edward Weisheimer, former minister at Central Christian Church in Youngstown.

The coalition challenged the assumption that corporations are the sole owners of the plants, he said. The coalition claimed that the community had a stake in the mills because it provided the schools, hospitals and roads that supported them.

“It was an issue of justice,” he said.

At the end of the program, which was part of a lecture series for Youngstown State University’s Center for Working-Class Studies, some people in the audience asked what could be done to create more high-paying jobs in the region.

“I don’t see jobs in Youngstown, high-paying jobs,” said David Venerose of Youngstown.

He said the area has relied on General Motors’ Lordstown plant for years. He warned that without action, the area will be holding an event like this someday to remember the end of automaking in the area.

shilling@vindy.com