|The independent voice of
preserving steelworker Legacy
|MAY 20, 2020
ARCHIVES PHOTO OF
DENNIS L PEARSON
|PHOTO OF DENNIS
L PEARSON TAKEN
BY WIFE ELEANOR
MAE PEARSON AT
HOME IN EAST
|The Bethlehem Plant of the former Bethlehem Steel Corporation was located
about 50 miles from Philadelphia and 90 miles from New York
It covered approximately 700 acres of land, extending along the Lehigh River 3
The Bethlehem Plant was a modern, integrated , Steel-producing unit,
processing raw materials into finished iron and steel products, with quality
control at each step: coal to coke and coal chemicals; coke, limestone, and
iron-ore to pig iron; iron, stone, and scrap to steel; steel to cast, forged, rolled
and manufactured products
The current sad reality is, the Bethlehem Steel Corp., the company that forged
the steel for the Golden Gate Bridge and many of the armaments the nation
used to win world wars, had ceased to exist .
And this reality, for those who worked in Bethlehem for the Bethlehem Steel
was hard to take. It was hard for them to live through the numerous shutdowns
that occurred in the local plant that led to the complete shutdown of the
Bethlehem Steel in Bethlehem. Many of these local workers despite not liking
what occurred were able to accept it as de facto reality... But never did it occur
to them that the Company as a whole would also become de facto reality
setting off de Jure logistics such as what would become of retiree health
benefits, Insurance , pensions , and their 401 K plans that the Company had
Meanwhile, beyond the troubles of Bethlehem Steel, the International Steel
Group (ISG) , headquartered in Cleveland, Ohio was established by the New
York investment firm WL Ross & Co. Its beginning was in 2002 when the WL
Ross & Co. LLC acquired the assets of bankrupt steel companies , the LTV
Steel (Ling-Temco-Vought) and Acme Steel corporations. And, rolled them into
ISG's next target would be Bethlehem Steel, the nation's second largest
producer of steel and steel products.
So, as it happened , the Bethlehem Steel announced it would terminate health
care and life insurance benefits for 95,000 retired workers and their dependents
by March 31, 2003. The cuts were part of the $1.5 billion purchase agreement
initially reached by Bethlehem with the International Steel Group (ISG), agreed
to in December 2002 and finalized on February 5, 2003 in an effort to bring
Bethlehem out of bankruptcy.
The Asset Purchase Agreement, in which ISG would purchase assets and shed
liabilities such as workers’ health care, insurance and pensions, would make
the investment group the largest integrated steel producer in North America.
ISG was founded in April 2002 by bankruptcy restructure specialist W.L. Ross.
Bethlehem Steel Corporation’s board of directors unanimously approved the
Asset Purchase Agreement on February 9, 2003 and it would be submitted to
the US Bankruptcy Court in New York in a matter of weeks for final action.
The consolidation would give ISG 16 million tons annual productive capacity,
one third the capacity of the world leader—the recently merged, Belgian-based
Arcelor. American companies, however, are acquired a significant cost-cutting
advantage against their European and Japanese rivals with the consolidation.
The question now being asked: Would Bethlehem Steel's legal successor, the
International Steel Group agree to provide former workers of Bethlehem Steel
some form of relief voluntarily or cast them adrift? And how long would ISG
Continue as the successor to Bethlehem Steel.
The answer being for the 1st question: While Bethlehem Steel, acquired
officially by International Steel Group of Cleveland in May 2003, would end its
sponsorship of the Cobra health insurance program on Sept. 30, as planned.
ISG agreed to assume responsibility for that program.
Which meant that Bethlehem Steel retirees would be able to continue in the
program for as long as they like, with increased premiums. But ISG would not
offer Cobra coverage to any Bethlehem retiree or spouse not currently
Cobra, short for Consolidated Omnibus Budget Reconciliation Act, allowed
Bethlehem Steel retirees to continue getting the health coverage they had when
the Bethlehem company was operating.
Of the 92,000 insured through former Bethlehem Steel plans, about 8,000
elected to take Cobra and retain the steelmaker's benefit plan, Davis said.
About one-quarter of that group was from the Lehigh Valley.
Another 10,000 company-wide have gone to plans by the American Association
of Retired Persons and about 4,000 took insurance with the National
Employees Benefits Co. of Warwick, R.I.
The balance are on Medicare and need to begin looking into their options,
The new premiums, of course, were more costly. A monthly premium for a
retiree under 65 would increase to $535, up from $386. A retiree and spouse,
both under 65, would see a jump to $1,028 from $773.
For a retiree over 65, the premium would increase to $294, up from $228. And
for a retiree and spouse, both over 65, the premium would increase to $556, up
from the current $447.
The answer for the second question being:
Mittal Steel Company N.V. was one of the world's largest steel producers by
volume, and also one of the largest in turnover. The Indian owned company is
now part of ArcelorMittal.
CEO Lakshmi Mittal's family owned 88% of the company. Mittal Steel was based
in Rotterdam but managed from London by Mittal and his son Aditya. It was
formed when Ispat International N.V. acquired LNM Holdings N.V. (both were
already controlled by Lakshmi Mittal) and merged with International Steel Group
in 2004. On 25 June 2006, Mittal Steel decided to take over Arcelor, with the new
company to be called ArcelorMittal. The takeover has been successfully
approved by shareholders and directors of Arcelor making L.N. Mittal the
largest steel maker in the world
We now ask a third question; Does ArcelorMittal continue to provide affected
retirees of acquired bankrupt companies some form of health benefits,,, The
answer is yes
The ArcelorMittal USA LLC VEBA Retiree Benefit Plan (“VEBA”) is a Plan under
the ArcelorMittal USA LLC VEBA Master Trust. The fund was originally
established pursuant to the 2002 Labor Agreement between International Steel
Group, Inc. (“ISG”) and the United Steelworkers (“USW”) to provide benefits for
certain eligible retirees (including surviving spouses) of steel companies that
were subsequently acquired. The benefits offered through the VEBA are
subject to the labor agreement that is in place and may change from time to
The VEBA was established to assist the retirees who were directly affected by
the bankruptcies of the following companies: LTV Steel • ACME Steel •
Bethlehem Steel • Georgetown Steel • Weirton Steel
Before I go on and recite more of my personal images of the former Bethlehem
Steel Plant during my last days there, I note that in my research I came upon a
wonderful commentary by Bill White , a former full-time Columnist for the
Morning Call who on a part-time basis still offers some interesting comment.
This Column first appeared in April 1998 on the day after the coke works shut
down. Now he claims the Coke Works was the last of Bethlehem Steel's local
operating units to shut down. Well I dispute this because as an employee in the
Steam, Water, Air and Combustion Department I know that we did not officially
shut down until June 21, 1998 making us the last Bethlehem Steel operating
unit to shut down..... And I was there on that last day ... Our purpose for hanging
on so long was to supply Whemco's Lehigh Heavy Forge steam, water , air and
combustion service until they had the facilities to handle these service
themselves. Interestestingly, Whemco's Lehigh Heavy Forge Unit was formerly
the BethForge unit of the Bethlehem Steel in Bethlehem before it was sold.
Now onto Bill White's impression of the vacated plant when he saw it:
From a distance, with the great structures in silhouette against South Mountain,
it's easy to remember how Bethlehem Steel dominated the economy, the
politics, the day-to-day life of this city.
But up close, as I walked along the Lehigh River and stared at the deserted
skeletal remains, a stark monument to stupidity and greed, those years of
greatness seemed very far away.
It's so quiet. So empty.
I found myself wondering how they survived as long as they did. The place
looks like nothing so much as a sprawling junkyard, full of broken windows,
weeds and rusty debris.
How could the world's No. 2 steelmaker have been allowed to degenerate into
this silent, decrepit hulk?
My gloomy thoughts that day reflected my belief that the end of steelmaking in
Bethlehem was hastened by management's shortsighted failure to modernize
its antiquated plant to meet the demands posed by the company's competition.
One person who disagreed was John Lovis, author of a book about Bethlehem
Steel's Sparrows Point plant and an engineer with the company for 39 years
before retiring in 1995 as the Steel's director of strategic planning. In response,
he sent me a copy of a paper he wrote in 2007, offering a much different view of
Now, in a new booklet called "Steelmaking in Bethlehem, PA: The Final Years,"
he explains how the plant operated and summarizes his perspective that
neither management nor labor was responsible for its fate. He believed no one
could have done anything to stop it.
Now until my memories:
For twenty-five plus years I worked in an integrated steel mill that traditionally made
quality steel from raw products rather then scrap, and used this freshly made steel to
produce a quality-finished product for shipment to the customer.
In future years, I will remember the following about the Bethlehem Plant:
Etched in my mind is the image of mountains of raw material nearby the new Minsi
Etched in my mind is the image of an elevated ore car taking ore to the Blast Furnace;
Etched in my mind is the image of the steel towers of the Blast Furnace with fire
shooting out its stacks to consume excess blast furnace gas, a by-product of the
Then too... Equally Etched in my mind is the the image of the steel towers of the Blast
Furnace without fire shooting out its stack because when the Blast Furnace ran its
final cast the Boiler House I worked in still continued and all we could see of the Blast
Furnace at night was darkness, And of course, before the towers were banked, we
who worked in the Boiler Houses of the Lehigh Division except for a privileged few
needed to join with all the rest of the employees in that Division to park our vehicles
outside the gates in unreserved parking spaces either provided by the company or in
un-metered or metered on street parking spaces situated in South Bethlehem. Only
when these same towers were totally banked and operations discontinued in and
around the pavement area between the west side of the Boiler House and East side
of the of the Blast Furnace did remaining hourly personnel in the plant be permitted
to park within the plant. Before this we either walked to the Boiler House or took
advantage of the internal bus service provided by the Company.
Coexistent with the above ... Etched in my mind is the image of blast gas highways
leading into the Boiler House for consumption in the Boilers;
Again Co-existent with the above ...Etched in my mind will be image of the inner parts
of these highways, which I had to sometimes enter to clean;
Etched in my mind too is the image of the giant ladle in the Basic Oxygen Furnace. As
a substitute teacher in the Bethlehem School District I had charge of a class, which
visited the BOF in operation; And when the school day was over, I returned to the
local plant for my scheduled work day. Some years later I saw this relative new facility
come down in a man caused whirlwind when the inside supports were removed and
bulldozers were utilized to pull the structure down sending massive debris upward
into the air and drifting south and east through the Northampton Heights, Miller Height's
and Hellertown communities as well.
Etched in my mind as well is the image of a red hot I - beam sliding down the line of
one of "old Bessy's" many beam making rolling mills... Indeed the benefit of me
opening the gas traps to relieve them of condensate water and dirt is that I got to see
sights like this when in the field;
Truly I don't estimate the importance of checking the integrity of the gas traps..
Because when they fail, those working in the plant are in danger... Etched in my mind
is the image of Little Al donning a Hazard suit containing a natural air pack to protect
him from toxic gases as he worked to repair all the plant gas traps blowing toxic gas
into the atmosphere.
Also, etched in my mind was the betrayal by the Bethlehem Steel Board of Directors of
its former flagship plant. Members of the Tri-locals 2598, 2599 and 2600 had made
concessions to management in exchange for modernization of Bethlehem's former
flagship plant. But management failed to live up to its end of the bargain.
Then lastly, etched in my mind was the day when the Boiler House grew silent when it
was my job to extinguish the flame of the gas pilot that gave life to the High Intensity
Boilers that we served. With that done, it was my time to walk out of the plant as an
active employee for the last time ... That's when the phtsical sights I spoke above
really hit you... And as Bob Hope would say ; "Thanks for the Memories"
Some years ago I wrote a poem while listening to the shrill whines of the air
compressors at the Spring Pit Compressor Station adjacent to # 2 Machine Shop. Let
me share this poem with you:
Where are we going? What directions do we give?
The meanings of life are so myriad.
Fortunes are amassed and fortunes are lost,
People are scurrying about.
Look for the divine to see the holy word.
Understand the love we often just observe.
Nothing matters except from above.
The eternal is more important than the temporal.
Some people live to be hundred years old.
Other people die before they are even born.
Some people are dead or forgotten while they remain alive.
While other people live on in our memories while they lay cold.
Where are we going? That's for us individually to decide!
Will or actions be constructive or lead to an eventual decline?
Fortunes are amassed and fortunes are lost.
People are still seen scurrying about.
Dennis Pearson -- Employee of the Bethlehem Steel the summers of 1965, 66, 67 and
68 and the years 1973 through 1998 with Active Status ending in 2000. He is a former
President of the Steelworkers' Archive. In his volunteer service for the Archives he
conducted many interviews with former steelworkers to preserve the legacy of those
whom worked in steel and initiated in his term of office the popular Steelworker
Walks on the Hoover Mason Trestle at the Blast Furnace and the County Sponsored
Steeple and Steel Tours
|PHOTO OF SAM
FROM # 1 BOILER
PHOTO TAKEN BY
|410 YEARS CHECK
STEEL INGOT TO
|TAPPING AN OPEN
STEEL FILLS A
LADLE; THE SLAG
SPILLS OVER TO