For decades, Mellon Bank has supplied the money to fire the steelmaking blast furnaces of the Monongahela Valley.
As Pittsburgh's dominant bank, Mellon backed the growth of the steel industry, providing seed money for new companies, loaning money for their expansion, financing the homes and cars of their workers. In a town where might, strength and power count for a lot, Mellon Bank became one of the mightiest, strongest and most powerful entities.
But now the Valley's fires are banked, victimized by recession and international competition. And Mellon is starting to feel heat of a different kind.
A grassroots coalition of union leaders and newly politicized ministers is putting pressure on Mellon Bank to take a leadership role in the revival of the "Mon Valley's" industrial base.
Picking up a theme being heard elsewhere in the nation, they charge--among other things--that the bank has become preoccupied with international lending at the expense of its hometown customers.
Mellon replies that it has not neglected its home town, and says that much of its overseas lending is for projects involving U.S. companies. "We are, by being a world-class bank, playing a role in the development of the future of Pittsburgh," says Barry I. Deutsch, senior vice president of the bank.
"We're really pushing the Mellon Bank because they're really pushing money abroad," says Ron Weisen, feisty president of United Steel Workers Local 1397, the union's biggest Pittsburgh-area local. "Mellon Bank is committing treason against the Monongahela Valley and America."
"Your money is being used against you!" shouts a flyer being distributed around Pittsburgh by the protesters, who call themselves the Network to Save the Mon Valley. "Your checking and saving accounts, put into Mellon Bank and other major investment banks, are being invested in foreign businesses, exporting your jobs, bankrupting your communities, destroying your way of life!"
The protest seems to have struck a chord in Pittsburgh's working-class community, which has suffered through unemployment exceeding 16 percent in the past several months. And the protestors claim their effort also has struck a nerve at Mellon, which they contend has put pressure on church elders to call off the ministers.. More visibly, the bank is considering changing its advertising campaign to answer some of the charges and to stress Mellon's commitment to the Pittsburgh area.
The bank's current campaign, built around the theme, "A Neighbor you can count on," has been the subject of ridicule by the protesters. "Their slogan should be, 'A neighbor you can't count on,' " Weisen gripes.
The protesters' chief weapon against Mellon is a six-month-old campaign to urge Pittsburgh-area residents to withdraw deposits from the bank. Leaders of the protest claim to have won pledges of $40 million in withdrawals; they are seeking $125 million. "What the pledge drive is about is leverage," says the Rev. James Von Dreele, one of the leaders of the Denominational Mission Strategy, a group of 30 Protestant ministers that is at the center of the anti-Mellon effort. "It's a leverage point to get the banks to start to reinvest back here."
Bank officials say they have no way of gauging how successful the withdrawal campaign has been, but they say that while it would not make much of a dent in the bank's $25 billion asset base, it has been a public relations headache.
Mellon's pain may have been most evident last week, when the protesters scored what appeared to be a victory over the bank by winning a bankruptcy court order to free up three weeks' worth of back pay--roughly $500,000 in all--that was due 350 workers at Mesta Machine Co., when the steelmaking equipment company was forced into bankruptcy in February by Mellon's foreclosure on a $20 million loan.
Mellon, which froze the company's accounts at that time, claims that the money could have been released at any time in the past four months; the protesters and company officials say they asked the bank repeatedly for the money without any success.
Until, that is, the protesters stepped up their withdrawal campaign. Holding a rally outside the Mellon branch in Homestead, near Mesta's plant, 200 demonstrators cheered as union locals, churches and individuals withdrew what was said to be $500,000 from the bank. The demonstration won national media attention, drew calls from state and local officials for the withdrawal of government accounts from the bank, and produced what was called the first unanimous vote in memory by the Pittsburgh City Council, in support of a resolution to withdraw $35 million in city funds from Mellon.
The next day, Mellon said it would support a petition to the bankruptcy court to free the funds.
Mellon officials insisted that the bank's support of the petition did not represent a change in position. But leaders of the protest hailed it as a victory, and as encouragement. "Mellon did act very positively to supply those benefits," said the Rev. John Gropp, pastor of Christ Lutheran Church in Duquesne, one of the spokesmen for the Denominational Mission Strategy. "Now we need them to act just as positively to provide aid for the valley."
The ministers are worried that all the hoopla over the Mesta back-pay issue will detract from their overall campaign against the bank, which they say will continue even though the court's ruling in their favor removed some of their momentum.
"They were trying to focus everything down to three weeks' back pay. It's a whole lot bigger than three weeks' back pay," said the Rev. Douglas Roth, pastor of Trinity Lutheran Church and another leader of the group.
What happened at Mesta, the ministers say, symbolizes many of their complaints about the bank. They are especially angry about Mellon's $5.5 billion in loans overseas, made at a time, the protesters say, that the Monongahela Valley desperately needed new investment.
They charge that Mellon has loaned tens of millions of dollars to foreign steelmakers who have taken business away from Pittsburgh's steel industry, and they are particularly angry about loans to a Japanese company that has a division that competes directly against Mesta.
And they wonder why Mellon let Mesta go bankrupt when large banks like Mellon have seemed willing to renegotiate large, troubled foreign loans. "We're saying you're not a neighbor you can count on when your greed for your profit causes you to bankrupt a small company like that," said Von Dreele.
But Mellon Bank officials defend their role in the Mesta affair, and their commitment to Pittsburgh, citing $80 million in industrial development loans made by the bank last year in Allegheny County, where Pittsburgh is located. If there has been a shortage of investment in the Monongahela Valley, they say, it's because there has been a shortage of proposals--not a bank emphasis on overseas business.
"We don't ration credit," said Deutsch, the Mellon senior vice president. "If U.S. Steel came to us and asked to borrow $10 million, would we tell them no, we want to invest in Australia? We'd probably write the check before the man was out the door.
"Until this particular strident minority came along, there never has been any question about Mellon's commitment to this region," he added. "They are a group of sincere people who are expressing a problem the region has, but they are doing it by scapegoating."
The protesters, however, vow to persist in their efforts against Mellon. "They're expecting us to go away now, but we haven't got the help for the valley that we want yet," Roth says. And the ministers say they are undeterred by pressure they say is being put on them through their church leaders by Mellon and by parishoners connected to the Pittsburgh establishment.
"These people have been telling us we've got to back off," says Roth. "But we consider the source. We have yet to have an unemployed person come up to us and say, 'You've got to quit this.' "
And the ministers see the protest as a logical extension of their mission. "We're simply out to provide some tangible, specific hope to people who have been hopeless," Von Dreele says. "To be in this valley is a very depressing thing."