Pretty consequential decision…I vote yes.
After a year of intense debate, it’s now up to President Joe Biden whether to allow the sale of U.S. Steel to Nippon Steel, a Japanese company — a decision that will send a strong signal about the environment for foreign investment in the U.S.
The Committee on Foreign Investment in the United States, an interagency panel that scrutinizes such deals for potential threats to national security, has sent its long-awaited report on the controversial transaction to the White House and the two companies, a person familiar with the situation said. Under the CFIUS statute, the president must now make a final decision on the sale within the next 15 days.
CFIUS was unable to come to consensus on whether to reject or approve the deal, leaving the decision to Biden. The outgoing president, a staunch ally of organized labor, has expressed deep skepticism about the sale, which is strongly opposed by the United Steelworkers labor union.
A top White House official first signaled Biden’s concern about
Nippon Steel’s proposed purchase of the iconic American company one year ago, saying the deal appeared “to deserve serious scrutiny in terms of its potential impact on national security and supply chain reliability.” In March, Biden
came out more strongly against it, saying it was “vital” for U.S. Steel “to remain an American steel company that is domestically owned and operated.”
All along, White House officials insisted that Biden would wait to see the CFIUS report before making a final decision, despite news reports in September and again in December that he was already poised to block the transaction.
Monday was the deadline for CFIUS to either approve the transaction or send the decision to White House. The CFIUS report lays out the pros and cons of approving the deal and describes the companies’ proposed mitigation plan to address national security concerns, according to a second person familiar with the situation.
Nippon Steel on Monday was clinging to hope that Biden would approve the transaction.
Nippon Steel has been informed by CFIUS that the Committee has referred this matter to President Biden after failing to reach a consensus on our transaction with U. S. Steel. During the 15-day period that the President has to make a final decision, we urge him to reflect on the great lengths that we have gone to address any national security concerns that have been raised and the significant commitments we have made to grow U. S. Steel, protect American jobs, and strengthen the entire American steel industry, which will enhance American national security.,” Nippon said in a statement. “We are confident that our transaction should and will be approved if it is fairly evaluated on its merits.”
However, the United Steelworkers, which represent the more than 20,000 U.S. Steel employees, reiterated their opposition.
“The proposed U.S. Steel-Nippon transaction represents nothing more than corporate greed, selling out American workers and jeopardizing the long-term future of the domestic steel industry and our national security,” USW President David McCall said in a statement. “Nippon has spent decades dumping its products into our markets, injuring U.S. producers and undercutting our members’ jobs.
The combative union chief also alleged that Nippon has a long-term plan to reduce U.S. Steel’s blast furnace capacity by transferring production from northern union’s facilities to the company’s non-union facility in Arkansas.
That “would further compromise our ability to meet our national security and critical infrastructure needs. Our union has been calling for strict government scrutiny of the sale since it was announced,” McCall said. “Now it’s up to President Biden to determine the best path forward. We continue to believe that means keeping U.S. Steel domestically owned and operated.”
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