In early 2002, financial analysts, government officials and thousands of current and former employees of a once-strong American company were in an uproar over that company's spectacular collapse. Participating in an industry subject to international influence and with a relatively few number of competitors, the company's slide toward bankruptcy and ultimate failure was portrayed by many as the ultimate failure of management to protect shareholders and employees, while management sought to portray the situation as one over which they had little control. The company in question is not Enron, which garnered the media's attention, but a company with a much longer history in that all-American industry, steel. LTV Corporation, itself the result of a mid-1980s merger, had suffered through difficult times before, including a previous bankruptcy filing, but had emerged successful. This time, the company's failure was drawn out over the course of 2001, and complete. As with Enron, current employees lost their jobs, former employees lost their pensions, and management is struggling to defend its actions. This research considers the company's performance, the factors contributing to its downfall, and the lessons that might be learned by others in similar situations.
LTV filed for bankruptcy protection in early 2001. At that time, LTV was a mainstay of the Cleveland economy, which was already suffering from years of major industrial employers relocating to other parts of the nation as well as other parts of the world. At the same time, many American politicians were particularly sensitive about the nation's increased use of imported steel. Steel generates strong feelings of patriotism and is closely identified with America's manufacturing might (whether those feelings are justified is a different matter). American steel has symbolic as well as real economic impact for politicians, particularly in the American heartland ("Trouble," 2002...