OPINION:
Japan’s Nippon Steel’s $14.9 billion bid to buy U.S. Steel is back. Former President Biden, reversing his kill order, leaves the company’s fate for President Trump to decide by mid-June. While he also opposes the existing deal, expect him to seek a better one rather than fold.
Nippon Steel and U.S. Steel sued Mr. Biden for the reprieve, arguing that he violated their constitutional right to due process. In a statement following the change, U.S. Steel stressed it’s “committed to completing” the merger.
U.S. Steel said that only the Nippon “partnership will deliver $55 per share to our shareholders and guarantee the significant capital investments and technology” to ensure “a strong U.S. Steel for generations to come and protect jobs.”
Presidents have used the Treasury-chaired Committee on Foreign Investment in the United States, CFIUS, to halt sales only nine times. Mr. Biden is the first to invoke the power against a company not owned or tied to Communist China.
Japan is bound to America by treaty and a common goal of containing the CCP’s ambitions. Despite being next door to the world’s second-largest economy, Nippon does only a small fraction of its business with Beijing.
Nevertheless, Mr. Biden said on Jan. 3 that the acquisition “would place” U.S. Steel “under foreign control and create risk for our national security and critical supply chains.” The word “foreign” bordered on defamation.
Japan is home to over a dozen American military bases, is a Major Non-NATO Ally, and already operates several thousand companies stateside. Mr. Biden ignored all of this, a decision that smacked of xenophobia.
On Monday, Cleveland-Cliff — which made a smaller offer for U.S. Steel — leaned on those same prejudices. Its CEO, Lourence Goncalves, called Japan “worse” than Beijing, saying they did “not learn anything since 1945” when two atomic bombs forced their surrender in World War II.
U.S. Steel is based in Clairton, Pennsylvania; its mayor, Richard Lattanzi, worked there as a pipefitter. He said Mr. Goncalves made him think he was “watching Hitler” and criticized him for “bringing up” the war.
Rather than a steel Trojan horse, Nippon’s offer promised to preserve jobs, union contracts, and “the iconic U.S. Steel name.” It’s why one unnamed senior Biden administration official opposed axing the sale.
“Bad decision,” the official told CNN. “Doesn’t actually protect union jobs and may kill the company.” Instead of advancing America’s interests, canceling the purchase may push the Japanese steel giant into the arms of Beijing as it seeks new investments.
Last week, Prime Minister Shigeru Ishiba of Japan touted the sale. “Cooperation among allies,” his spokesman said, “is indispensable for establishing resilient supply chains, and that it is important … to promote economic security.”
The CEO of U.S. Steel, David Burritt, appeared on CNBC last week to urge Mr. Trump to “step in now and undo the wrongful, shameful, corrupt actions of Biden.” He made the appeal, although the president-elect wrote on Truth Social last month that he was “totally against” the sale to “a foreign company.”
That remark doesn’t leave much wiggle room. But a look at Mr. Trump’s dealmaking shows that he is willing to reverse himself to reach the desired outcome. “Sometimes,” Mr. Trump wrote in “The Art of the Deal,” “part of making a deal is denigrating your competition.”
Mr. Trump wrote of displaying a willingness to “walk away,” while “pushing and pushing and pushing to get what I’m after.” The vice chairman and representative director of Nippon Steel, Takahiro Mori, holds out hope that Mr. Trump is again engaging in gamesmanship.
Mr. Biden “blocked our deal over electoral politics, not security,” Mr. Mori wrote in the Wall Street Journal last week, and Nippon is still “interested in exploring possible partnerships with the new administration to invest in and grow U.S. Steel to benefit American workers, customers, and national security.”
Mr. Trump wrote on Truth Social that he wants to make U.S. Steel “strong and great again.” He can accomplish that by greenlighting Nippon’s purchase. It would be a domestic and foreign policy win, and a rebuke of letting xenophobia stand in the way of saving an iconic American company.
• Dean Karayanis is content producer for the Clay Travis & Buck Sexton Show, former Rush Limbaugh staffer, and host of History Author Show on iHeartRadio.
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