When President-elect Donald Trump takes over as commander in chief again on Jan. 20, a bevy of problems and challenges will confront him. People are still battling a cost-of-living crisis. Wars are raging in Europe and the Middle East. Great concern exists across the United States about the growing power of China and what it may mean for war and peace in Asia and America’s geopolitical strength. The Biden administration’s handling of immigration seems to have resulted primarily in total chaos, leaving people looking for solutions that may be trickier to identify and deploy than the incoming administration believes.
One thing that should be simple is reversing President Joe Biden’s absurd policy on the proposed acquisition of U.S. Steel by Nippon Steel and allowing that marriage of companies to proceed.
U.S. and Nippon reached their deal over a year ago, on Dec. 18, 2023. Fast-forward 12 months, and the Biden administration is reportedly planning to block the merger on national security grounds.
It should surprise exactly no one that an economically illiterate administration, which is headed by a barely compos mentis individual and has gravely mismanaged America’s relationships around the globe, might have failed to notice that Japan is a key U.S. ally and we’re 80 years on from World War II. Yet here we are, and it will be down to Trump to reintroduce a measure of rationality and sense to what has evidently been a flawed decision-making process.
In addition to missing the key tidbit that it is no longer December 1941 or even December 1984, critics of the merger have missed that this is not an acquisition of a U.S. company by a foreign government. Nippon Steel is a publicly traded company owned and controlled by its shareholders. Proponents of the deal underline that Nippon is already invested in numerous steel manufacturing facilities across America, including Standard Steel in Burnham, Pennsylvania, and Wheeling-Nippon Steel in Follansbee, West Virginia, and maintains headquarters in Houston, Texas. So, despite its name, it is already surprisingly American.
But Nippon does have capabilities that differ from, and complement, those of U.S. Steel: Per a fact sheet distributed to members of Congress, “Introducing Nippon Steel’s cutting-edge technologies to U.S. Steel’s facilities will allow the company to manufacture American-made high-grade steel products like electrical steel and automotive flat steel for customers in the United States and North America.” The company also uses hydrogen in ways that would likely enable U.S. Steel to manufacture more steel, of more varieties, and do it in a cleaner fashion. That means U.S. Steel’s future, and that of its workers, will likely be far brighter post-acquisition than now.
For those who worry that might not be true because layoffs and compensation and benefits cuts can indeed follow big mergers and acquisitions (at a minimum, it is illogical to keep two human resources teams working full time, fully staffed once a merger or acquisition has occurred), it’s worth noting that Nippon Steel has committed to lay off zero United Steelworkers-represented employees despite possible overlap and duplication of staff once the acquisition is finalized. The company has also pledged not to cut levels of compensation or benefits below their current levels, which, given Nippon Steel’s promise to broaden and diversify what U.S. Steel is manufacturing, makes sense.
More consumer demands will be met, setting up the company and its employees for greater long-term success. Some lefty union activist types may not like the deal, but their concerns seem exaggerated: U.S.-based Nippon Steel workers are already represented by the United Steelworkers union, which will continue to represent U.S. Steel workers after the deal is complete. Lots of actual U.S. Steel workers support the acquisition, even if the United Steelworkers — as in the union, which endorsed Vice President Kamala Harris and not Trump — does not.
Old-school Democrats such as Biden and many of those who have traditionally advised him may instinctively view “the Japanese” acquiring a big name in the almost-sacred-to-Democrats American steel industry as a taboo that must be resisted at all costs. (Biden critics among us would note that this is the same president who keeps a giant portrait of Japanese-American-interning President Franklin D. Roosevelt in his Oval Office.)
But Trump has traditionally and instinctively understood far better that America’s and Japan’s interests are inextricably linked, not just with regard to China, the real elephant in the room, and security in Asia more broadly but also on a more fundamental, personal, and cultural level. Trump was known to be very close to assassinated Japanese Prime Minister Shinzo Abe. In addition to Abe being the first foreign leader to meet with Trump during his first presidency, just two weeks ago, Trump hosted Abe’s widow at Mar-a-Lago. Trump is reported to call her regularly to check on her well-being in the aftermath of her husband’s murder.
He has also met with the CEO of SoftBank at Mar-a-Lago and said he would “love to see” Prime Minister Shigeru Ishiba, including meeting him before his second inauguration if Japan wishes. Of course, as a 1980s property developer in New York, Trump had extensive interaction with Japanese investors. It’s logical that he would understand the value of U.S.-Japanese relationships — governmental, business-to-business, and in terms of foreign direct investment — in a way Biden simply cannot.
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A bonus of Trump backing the Nippon Steel-U.S. Steel deal: The former and future president loves nothing more than beating Democrats at their own game. Nippon Steel’s plans for U.S. Steel would enable it to remain a manufacturing powerhouse while moving American steel production much closer to achieving net-zero status — and faster. Wouldn’t it be something for the party that proclaimed it was the only entity that could deliver green manufacturing and a cleaner environment to be shown up by the guy who spent much of 2024 blasting the “Green New Scam”?
Trump should reverse Biden’s impending economically and national security-illiterate decision and put his weight behind this acquisition. It’s an easy way to bank a win for steel manufacturing, individual workers, U.S.-Japan relations, the free market, and, yes, the greening of the U.S. economy — and annoy the heck out of his foes and detractors along the way.
Liz Mair is the founder, owner, and president of Mair Strategies, a boutique strategic communications firm with offices in six U.S. metropolitan areas.