President Joe Biden Opposes Sale of U.S. Steel to Nippon Steel, Emphasizes Need for Strong American Steel Companies
Implications for Biden’s Presidential Campaign
WASHINGTON (AP) — President Joe Biden has taken a stand against the proposed sale of U.S. Steel to Nippon Steel of Japan, stating that maintaining American steel companies built by American steel workers is crucial. In an exclusive statement obtained by The Associated Press, President Biden emphasized the iconic status of U.S. Steel as an American company that should remain domestically owned and operated. Thursdays’s announcement, timed to coincide with Biden’s Midwest campaign, has the potential to shape the narrative of his race against presumptive Republican presidential nominee, Donald Trump. Biden’s campaign has focused on revitalizing American manufacturing, bolstering his image as a supporter of the working class and gaining the endorsements of the AFL-CIO and prominent unions.
Controversies Surrounding the Sale
Nippon Steel’s announcement in December to acquire the Pittsburgh-based steel producer for a staggering $14.1 billion in cash has raised concerns about the impact on unionized workers, supply chains, and U.S. national security. While the Japanese company attempts to address these concerns by promising no job losses as a result of the merger, as well as committing to maintaining the U.S. Steel name and Pittsburgh headquarters, the transaction remains a subject of scrutiny. As the fourth largest steel producer globally, Nippon Steel has launched a website featuring supportive statements from prominent figures such as Larry Summers, the former treasury secretary, and Pat Toomey, a Republican and former senator from Pennsylvania, aimed at easing concerns and advocating job growth.
Review by the Committee on Foreign Investment in the United States (CFIUS)
Following the initial steel deal announcement, the White House revealed that it would come under review by the secretive Committee on Foreign Investment in the United States. While the CFIUS review process lacks official updates, it highlights the potential national security implications of the transaction.
Biden’s Response and Trump’s Opposition
Despite having a platform to intervene, Joe Biden has chosen not to interfere directly in the review process or officially block the acquisition. This decision was confirmed by an anonymous source familiar with the deliberations. On the other hand, Donald Trump, in a meeting with the Teamsters union earlier this year, expressed his intention to immediately block the acquisition of U.S. Steel by a Japanese company, deeming it a detrimental action. Trump’s specific concern echoes Biden’s sentiments, emphasizing the significance of maintaining American ownership of U.S. Steel.
Biden’s Union Support and Implications for the 2024 Election
President Biden is set to solidify his backing from union workers as he travels to Saginaw, Michigan, a city once home to multiple General Motors plants. Recognizing the impact his support from unions can have on the election, Biden aims to resonate with voters in this swing county, which narrowly supported Trump in 2016 but flipped to Biden in 2020. Additionally, his close relationship with the United Steelworkers, evident in his February statement to the union regarding Nippon Steel’s plans, showcases his dedication and commitment to their cause. Headquartered in Pennsylvania, U.S. Steel’s fate in this planned acquisition holds significance to securing key states in the 2024 election.
Concerns Raised by United Steelworkers and Biden Administration’s Outlook on China
The United Steelworkers recently expressed their apprehensions regarding Nippon Steel’s commitment to honoring existing labor agreements and the company’s financial transparency, posing potential obstacles to achieving a merger. Additionally, Nippon Steel’s connections to China have alarmed the Biden administration, which perceives Japan as a vital partner in countering China’s regional dominance. China, as the largest global steel producer, followed by India, Japan, and the United States, further establishes the complex landscape of the steel industry and the emergent economic and geopolitical challenges it presents.
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AP writer Jill Colvin contributed to this report.
