Biden Blocks Japanese Country from Purchasing US Steel

This week, Joe Biden blocked the acquisition of US Steel by a Japanese-owned business.

In the process, Joe Biden handed Donald Trump a fairly significant win… or did he?

Keep It in America

Donald Trump has been adamant for years that he does not want foreign companies coming into the country and buying up farmland and businesses.

During the presidential campaign, Donald Trump was asked about this big push we have seen of Chinese investors grabbing huge blocks of American farmland.

Trump stated, “We’re going to protect it by saying 'you can’t come, you can’t do it, we don’t want you buying our land. 'We don’t want you taking the land and basically taking it off the market, and we don’t want you doing it.”

Rep. Michelle Steel (R-CA) backed Trump's play, stating, “Nations which threaten the United States should not have easy access to our port infrastructure, a key lifeline of America’s supply chains. My Secure Our Ports Act would shore up America’s economic and national security in the face of threats from Communist China and their like-minded allies. Congress must protect America’s supply chains by restricting adversarial governments from having high-level access to our ports.”

No Sale

That stance does not only apply to our enemies and adversaries, as Trump was very much against the sale of US Steel to a Japanese-owned company. When Nippon Steel placed a $15 billion to purchase the struggling company, Trump stated, “I am totally against the once great and powerful U.S. Steel being bought by a foreign company, in this case Nippon Steel of Japan.”

Nippon Steel pushed back on the resistance, responding, “We will invest no less than $2.7 billion into its unionized facilities, introduce our world-class technological innovation, and secure union jobs so that American steelworkers at U. S. Steel can manufacture the most advanced steel products for American customers.”

While the United Steelworkers union as an organization opposed the deal, quite a few of the industry’s employees were pushing for the deal to go through. US Steel also chimed in, stating, “Nippon Steel has committed to preserve U.S. Steel as a U.S. company headquartered in Pennsylvania and to contribute billions of dollars of investment to our mills and communities, securing the future of steelmaking in Pennsylvania and Indiana. No other party can do this.”

This week, Joe Biden shot down the deal, giving Trump a win, but there are plenty of people on both sides of the aisle wondering if this was really the right thing to do. There are also those that belive Biden knows this could result in US Steel shutting down, or massive layoffs, all of which would take place under Trump's presidency, creating another landmine for Trump.

Biden Shuts It Down

Biden killed the deal via the Defense Production Act of 1950, claiming, “There is credible evidence that leads me to believe that (1) Nippon Steel Corporation, a corporation organized under the laws of Japan (Nippon Steel) …  might take action that threatens to impair the national security of the United States.”

I just read a piece in the National Review by its editorial board pushing back against blocking this sale. The point being that Nippon Steel is not owned by the Japanese Government, nor is US Steel owned by the United States government. Not to mention, Japan is an ally, so what right does the government even have to block this sale?

The piece goes on to show how beneficial this deal would be to American workers, many of whom may lose their jobs if US Steel is unable to sell the company. The piece concluded, “If the federal government wants to say anything at all about this deal, a simple ‘thank you’ would suffice. But ideally it would be silent, as it is for most mid-cap acquisitions, presuming that shareholders know best what to do with the companies they own.”

This is not really my niche, but I completely get the argument being made by the National Review. What I do know, however, is that if US Steel closes and we suddenly have thousands of hardworking Americans out of a job, and it decimates a city like Pittsburgh, where the company has been based for more than a century, it will blow back on Trump for having supported this from the outset.