The organ failure cascade that commenced with the financial markets collapse is rapidly spreading to fabrication and basic industries, including auto manufacturing and the steel industry. The principal automakers in the U.S. are on the verge of bankruptcy.

A notable development in the steel industry was the announcement by Severstal, the largest (or possibly second-largest) steel and mining company in Russia, of the cutting back of steel production by 30%, about a month after announcing an expected increase of the same amount. They have a presence in Dearborn, Michigan and other locations in the U.S.

The negative effect these developments will have, especially, on Michigan’s economic well-being will be significant. Layoffs or firings may be around the corner.

None of this is surprising, of course. What is surprising is that Russia has a major foothold in the U.S. steel mill industry. As I recall from economic history, U.S. steel mills were once vast operations primarily situated in just a few areas, such as Pittsburgh and Baltimore. They were becoming artifacts by the middle of the last century, giving way to smaller, more efficient and decentralized operations scattered all over (proving economies of scale are not a given).

Meanwhile, Severstal, once a state-owned concern in Russia, was privitized after Parastroyka, with basically one person, the principal shareholder. Since that time, it has acquired major operations in Europe and the U.S. In the U.S., it owns Rouge Industries in Dearborn, Mich., Bethlehem Steel at Sparrows Point (Baltimore), and WC Steel in Warren, Ohio.

Alexei Mordashov, aged 43, the principal shareholder of Severstal, is said to be worth billions (19 on list of 100 wealthiest people). Besides steel making capacity, his company’s portfolio includes automakers, coal companies, ports and transportation companies, and sundry other enterprises.

A Russian investigative reporter of tsarist regime descent, Paul Klebnikov, wrote an exposé of Mordashov published in Forbes in 2004. According to the Beeb in a 2006 profile of Mordashov:

The late US investigative journalist Paul Klebnikov suggested in Forbes magazine in 2004 that Mr Mordashov secured ownership of Severstal by ousting his former boss.

Mr Klebnikov further said that Mr Mordashov used the firm’s vast steel earnings to buy up shares originally issued for its staff.

Mr Mordashov insisted in the same article that "we never seized anything, we never twisted anyone’s arm, we never used state organs or corruption".

He added: "We paid for everything we acquired."

Through a range of investment vehicles, Mr Mordashov today personally owns 89.6% of Severstal, and has built the company up into a business with annual revenues of $11.7bn (£6.3bn).

In additional to steel, Severstal now has mining, automotive, plywood, banking and insurance interests.

In the same year the exposé was published, Klebnikov was murdered on the streets of Moscow in a drive-by shooting. It is said that through his investigative work, he’d developed a number of enemies in the murky post-Parastroyka Russian business world.

It’s so reassuring that people like those Klebnikov wrote about are in control of major businesses in America, particularly at a time when Wall St is openly embracing the gangster ethic.