EoW September 2010

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EuroWire – September 2010 20
Transat lant ic Cable
The oil spill
The historian’s-eye view: American history
abounds with longer-term catastrophes
than the Deepwater Horizon
In the US, the effort to stem the flow of crude oil into the
Gulf of Mexico has been accompanied by lively commentary
on whether or not it is the worst environmental disaster
America has ever faced. President Obama declared that
it is. But the Washington Post, among others, points out
that the national past is littered with oil spills, explosions,
toxic dumps, extinctions, and at least one river on fire. On
22nd June – Day 63 since the explosion of the Deepwater
Horizon rig – David A Fahrenthold and Ylan Q Mui wrote that
historians, predictably, say an evaluation of the president’s
words depends on what he meant by “worst” and “disaster.”
The Dust Bowl of the 1930s caused more social upheaval.
The Exxon Valdez oil spill in 1989 had a higher wildlife death toll.
The pesticide DDT affected a wider swathe of the country.
The Post reporters observed, “From the perspective of a bison
or a (now-extinct) passenger pigeon, the whole thing might
look like one long disaster.” (“Historians Debate Designation
of ‘Worst Environmental Disaster’ in US”). At this writing, the
cap-and-capture effort that has riveted public attention to
the gulf appears to be gaining on the problem. While we wait,
it might be worthwhile to consider a letter to the editor of the
Beaufort (South Carolina) Gazette that was cited by syndicated
columnist Thomas L Friedman as the best reaction he has seen
to the oil spill (“This Time Is Different,” 11th June):
“I’d like to join in on the blame game that has come to
define our national approach to the ongoing environmental
disaster in the Gulf of Mexico. This isn’t BP’s or Transocean’s
fault. It’s not the government’s fault. It’s my fault. I’m the one
to blame and I’m sorry.
“It’s my fault because I haven’t digested the world’s
in-your-face hints that maybe I ought to think about the
future and change the unsustainable way I live my life. If the
geopolitical, economic, and technological shifts of the 1990s
didn’t do it; if the terrorist attacks of Sept. 11 didn’t do it;
if the current economic crisis didn’t do it; perhaps this oil spill
will be the catalyst for me, as a citizen, to wean myself off of
my petroleum-based lifestyle.
“‘Citizen’ is the key word. It’s what we do as individuals that
counts. For those on the left, government regulation will not
solve this problem. Government’s role should be to create
an environment of opportunity that taps into the innovation
and entrepreneurialism that define us as Americans. For
those on the right, if you want less government and taxes,
then decide what you’ll give up and what you’ll contribute.
“Here’s the bottom line: If we want to end our oil addiction,
we, as citizens, need to pony up: bike to work, plant a garden,
do something. So again, the oil spill is my fault. I’m sorry.
I haven’t done my part. Now I have to convince my wife to
give up her SUV.” Mark Mykleby
Steel
Newly optimistic Midwestern steel
processing centres wager that demand for
steel will continue to rise with the US economy
As demand for flat-rolled and bar steel picks up in the American
Midwest, the steel processing centres that serve auto makers,
appliance manufacturers, and the light-manufacturing industries
are bellwethers of the progress of the US steel industry back
toward pre-recession health. The centres – variously known as
distributors, stockists, and service centres – suffered along with
the steel producers which at their lowest point were operating
at only 40% of capacity. Now, the steel makers are at about
70% of capacity and feeling much better about their prospects.
Accordingly, so are the steel processing centres. Writing in the
Southtown Star (Tinley Park, Illinois), Mike Nolan profiled one of
them: the cavernous Sun Steel plant, in Chicago Heights, sold to
Russia’s OAO Severstal in 2008 and re-acquired by the original
American owners in May of this year.
Together with Sun, the brothers James and Craig Bouchard
have bought back another Chicago Heights steel centre,
Century, from Severstal. Their Chicago-based company Esmark,
through its Esmark Steel Group subsidiary, had already begun
reassembling a core group of steel service centres. With a
$100 million line of credit from GE Capital, the financial services
unit of the multinational conglomerate General Electric
(Schenectady, New York), Esmark is also considering other
acquisitions. (“Brothers Banking on Steel Rebound,” 13 th June).
“It’s going to be a slow climb out”for the steel processing centres,
the Esmark Steel Group chief executive Tom Modrowski told the
local newspaper. But an account of the Bouchard brothers’ recent
activities suggests speed and nimbleness beyond the ordinary.
Until about two years ago, the Bouchards operated a network
of ten steel service centres around the Midwest, as well as the
producer Wheeling-Pittsburgh Steel Corp (Wheeling, West
Virginia). They bought Sun in 2004, followed by Century in
early 2005. In the summer of 2008 – just months before the
collapse of the financial markets – they sold the whole bundle
to Severstal for $1.2 billion, with the Russian producer assuming
outstanding Esmark loans and debt. A noncompete agreement
kept the Bouchards on the sidelines for a year, according to
Mr Nolan. Then, last fall, they plunged back in, paying $10 million
for Amtex Steel, a service centre in nearby University Park that
has been renamed Chicago Steel & Iron.
“Along with Sun and Century, the Bouchards also picked ❈ ❈
up an Ohio steel service center they had sold to Severstal,”
Mr Nolan wrote. “Esmark didn’t say how much it paid for the
assets. Combined, the service centers annually ship about
300,000 tons of flat-rolled steel, according to Esmark.”
Good judgment and good timing obviously figure in the
Esmark story to this point. So does good luck. And the
company evidently expects more of the same.
Esmark Steel Group CEO Tom Modrowski told the Southtown
Star, “We’re excited about what lies ahead.”