House Measure Would Give Health Benefits to Retired Steel Workers in Certain Circumstances

Rep. Phil English (R-Pa.) on April 24 introduced a bill that would provide health benefits to retired steel workers in certain circumstances, but the measure received a "less than enthusiastic welcome" from other lawmakers and steel union officials, the Baltimore Sun reports. The legislation would provide health benefits for retired steel workers in cases when a retiree's former company closes, the company is acquired by another U.S. steelmaker or the acquiring company scales back production capacity (Henry, Baltimore Sun, 4/25). The cost of the benefits would be covered by a new Treasury Department trust fund that would be created in part with tariffs on imported steel products (Warner/Norton, CongressDaily/AM, 4/25). Rep. Benjamin Cardin (D-Md.) said that the bill is not "comprehensive enough," and added that he is considering introducing legislation that is "almost identical" to a bill (S 2189) proposed last week by Sens. John Rockefeller (D-W.Va.) and Arlen Specter (R-Pa.). That bill "casts a wider net" of health coverage for retired steel workers, including providing benefits for retirees of "troubled" companies and companies that are acquired by foreign steelmakers. A spokesperson for the United Steel Workers of American did not "comment specifically" on English's bill, but said that the group "strongly supports" the Rockefeller-Specter legislation and is working with Rep. Peter Visclosky (D-Ind.) on a similar measure (Baltimore Sun, 4/25).

Examining the Industry
The Wall Street Journal on April 25 examines steel companies' struggle to pay an estimated $10 billion in health care coverage and other benefits for retired workers and their dependents and how that obligation is creating a "quiet but potentially profound transformation" in the industry. The increasing strain of these so-called "legacy costs" is a "key reason" why many steelmakers are unprofitable and have been forced to declare bankruptcy. In the past four years, steel companies that liquidated have left 125,000 retirees and dependents without benefits, including health coverage. The Journal reports that some steelmakers are "starting to reshape themselves" and are dropping benefits for retirees in order to become more profitable (Matthews, Wall Street Journal, 4/25).