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President Biden yesterday took the name U.S. Steel literally, blocking Japan’s Nippon Steel Corp.’s planned $15 billion takeover of the iconic Pennsylvania steelmaker.
Biden has said keeping steel suppliers under U.S. ownership is a national security necessity, but many officials charged with investigating the issue reportedly disagree.
Two steelmakers derided Biden’s decision as politically motivated and said it sent a “terrifying message” to investors in the US. However, the move was welcomed by the United Steel union, which had opposed the deal, arguing that Nippon Steel would reduce U.S. Steel’s union workforce.
Many prominent commentators said that Biden’s pre-election opposition to takeovers (a position echoed by President-elect Donald Trump) was based on voters in key battleground states and foreign interests in the companies that underpinned America’s industrial power in the 20th century. It was seen as pandering to citizens who might be hesitant about owning capital. . But in 2025, U.S. Steel is a shell of its former glory.
The company has just 14,000 U.S. employees, down from its peak of 340,000 in 1943. The company has long lagged behind rival steelmakers in Europe and Asia, which have reduced labor and adopted more energy-efficient production methods. U.S. Steel has warned it may close some plants. If an agreement involving $2.7 billion in equipment upgrades is not reached.
Looking ahead… Nippon Steel and U.S. Steel have indicated they may challenge the decision in court. —SK
