Nippon Steel and US Steel: One Last Chance, Mr Trump

Team Biden is doing so many strange things on its way out the door that nobody should have been surprised that President Joe Biden (or whoever calls the shots) rejected Nippon Steel’s bid to buy US Steel.

The White House declared the deal was a threat to national security. Nevertheless, most of the Committee on Foreign Investment in the United States, known as the CFIUS review board that considered the national security angle, didn’t see it that way.

If there are national security concerns with this deal, President Biden needs to state clearly what they are.

And then he and his team need to make their case publicly at union halls and local chambers of commerce in the parts of Western Pennsylvania and Indiana that will be hammered hard by this decision.

Will they? No.

Pennsylvania Governor Josh Shapiro and Senator John Fetterman also need to make an appearance down in southwest Pennsylvania. They, too, must explain why this was a good decision.

Will they? No.

Shaking the Alliance 

This decision won’t bring down the US-Japan alliance. But it hurts.

Japan is routinely touted as America’s main ally. The “most important bilateral relationship – bar none,” as former Ambassador Mike Mansfield put it.

We’re soon going to need Japan to do more militarily than it has ever done – or than it wants to do.

Telling Japan, “We want you to fight China with us but we don’t want you to own US Steel” won’t be well received in Tokyo.

Japan and its companies have been treated this way before – starting in the 1980s when Japan was vilified as the economic bogeyman going to put US business out of business. Instead, Japan showed some forbearance while jolting US industry ー particularly Detroit automakers ー into getting its act together.

In the Nippon Steel case, the company bent over backward, or better said, “bent over forward” in an almost humiliating fashion to demonstrate its good faith. It even offered to give the US government a veto over any future business decisions regarding US Steel output.

A key allied nation’s company should not have to do this.

As for the national security argument?

It must irk Tokyo that it is lumped in with the communist Chinese. And don’t think they haven’t noticed that the Biden administration supports the planned CCP-tied Gotion battery factory in Michigan. That site is also located near a US military base. The locals don’t want it, but Team Biden does.

Indeed, the US companies whose hardware and technology were reportedly in the Chinese spy balloon that the Biden administration allowed to fly over the United States in 2023 pose more of a national security threat than Nippon Steel.

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