Republican and Democrat opposition is mounting against Nippon (), a Japanese firm, from buying U.S. Steel () corporation. Biden wants scrutiny. Trump is silent. Why?
U.S. Steel Bought by a Japanese Company, Thank TariffsOn December 20, I wrote
On Monday, U.S. Steel agreed to a takeover bid by Japan’s Nippon Steel for $14.1 billion. Ironically, U.S. protectionism played a role.
CNN noted the deal marks the latest step in a gradual decline for the iconic 122-year old company, which was once the largest company on the planet.Sen. John Fetterman (D-Pa.) vowed to block the sale describing the deal as “outrageous”.The United Steelworkers union (USW) is also outraged. “To say we’re disappointed in the announced deal between U.S. Steel and Nippon is an understatement, as it demonstrates the same greedy, shortsighted attitude that has guided U.S. Steel for far too long,” said (USW) International President David McCall.But the big three automakers are happy. The automakers were fearful US Steel would accept a bid from Cleveland-Cliffs, a US company. They are worried “The combined company would have controlled 100% of blast furnace production in the U.S. and 65% to 90% of domestic steel used in vehicles.” Where Does Biden Stand?Politico reports
President Joe Biden believes Japanese company Nippon Steel’s planned purchase of iconic American company U.S. Steel deserves “serious scrutiny” because of potential national security and supply chain concerns, a top White House official said Thursday.
Biden “has been clear that we welcome manufacturers across the world building their futures in America with American jobs and American workers,” White House National Economic Adviser Lael Brainard said in the administration’s most extensive comment yet on the proposed deal. “However, he also believes the purchase of this iconic American-owned company by a foreign entity — even one from a close ally — appears to deserve serious scrutiny in terms of its potential impact on national security and supply chain reliability.”
Democrat and Republican RebellionNewsweek reports
Fetterman, a Pennsylvania Democrat, was among them, posting on a video on X (ex-Twitter) next to U.S. Steel’s plant in the town of Braddock, Pennsylvania where he described it as “absolutely outrageous” that the firm has agreed the sale “to a foreign company.”
He has joined a bipartisan group of politicians in calling for a review into the proposed acquisition, which includes fellow Pennsylvania Democratic Senator Bob Casey as well as Republican Senators J.D. Vance of Ohio, Josh Hawley of Missouri, and Marco Rubio of Florida.
Meanwhile, Ohio Democratic Senator Sherrod Brown called the move a “back-room acquisition” that was a “slap in the face to union workers and has signed a letter in which he has called for the Biden administration to conduct a comprehensive review of the deal and its impact.
Sen. Dick Durbin, an Illinois Democrat, told The Hill there was something “fundamentally troubling” about the merger and that he’s been concerned for years about U.S. Steel’s production cuts. “We’ve been troubled by their announcements over the past several years of reducing production,” he said.
Republican senators wrote to Treasury Secretary Janet Yellen to argue the Committee on Foreign Investment in the United States (CFIUS) should block the sale.
Trump is silent. I will explain why in a moment. See if you can figure it out.The Case for Nippon
The Case Against NipponThere is none. But if you insist, it’s 100 percent political.Biden may very well try to kill the deal, hoping simultaneously avoid blame. Perhaps he can do that by insisting on green energy demands, free daycare, or a huge basket of things that Nippon cannot accept and backs out.One way or another, Biden is going to upset someone, most likely a lot of people. This is a problem he wishes that he did not have.Why is Trump Silent?Trump is silent because he has no position. Rather, his position is to wait to see what Biden does and criticize the hell out of it.Trump would be wise to not take a position now because no matter what that is, Biden could do the same.ZugzwangZugzwang is a setup in chess in which whoever has to move next, loses something.The position below is extreme Zugzwang. Whoever’s turn it is now, loses a pawn immediately, then later the game as the remaining pawn gets promoted to a queen.
Political ZugzwangBy not taking a position, if Biden approves the deal Trump will criticize it and so will all the Trumpian lap dogs and protectionists in both parties.Trump’s standard response in any situation is “I would have gotten a far better deal.” That is the minimal outcome here.But if Biden rejects the deal, Trump will find a way to support it or at least criticize it for some reason.The big win for Trump comes if Biden kills the deal by placing a bunch of clean, green, silly mandates on it. Trump will really howl and in that case he will be right.Biden is in a no-win position assuming Trump stays silent, and perhaps even if Trump isn’t silent. Having to do something first is a huge disadvantage to Biden.Hello JoeHello Joe, it’s your move. What’ll it be?More By This Author:Hooray! Inflation Supposedly Went Negative In November, But How Does It Feel?What’s The True Number Of New Homes For Sale? How Much Builder Speculation? Huge Thud In New Home Sales, Down 12.2 Percent In November
