What Pennsylvania officials are saying about Biden’s decision to kill the U.S. Steel deal
The proposal by Japan’s Nippon Steel company to buy the venerable 124-year-old steel company based in Pittsburgh had been on the table for some time.
Saying a sale would threaten U.S. security, President Joe Biden blocked a Japanese company’s $15 billion bid to purchase Pennsylvania’s U.S. Steel on Friday.
“Steel production — and the steel workers who produce it — are the backbone of our nation,” Biden said in a statement. “A strong domestically owned and operated steel industry represents an essential national security priority and is critical for resilient supply chains.”
Biden’s decision came after the Committee on Foreign Investment in the United States failed to reach a consensus on security risks of the sale last month, which left the decision to the president. The committee screens business deals between U.S. firms and foreign investors and can block sales or force parties to change the terms of an agreement to protect national security.
Hanging over the presidential election in swing-state Pennsylvania last year, the proposal by Japan’s Nippon Steel Corporation to buy the venerable 124-year-old U.S. Steel company headquartered in Pittsburgh had been opposed by Biden as well as both Vice President Kamala Harris and President-elect Donald Trump, each of whom warned that a sale would threaten thousands of Pennsylvania jobs.
» READ MORE: Everything you need to know about the Pa. steel deal at the center of the presidential election
Reaction to Biden’s order poured in swiftly.
Pennsylvania Gov. Josh Shapiro noted in a statement on Friday that he expects U.S. Steel to “uphold their commitments to Western Pennsylvania” and “refrain from threatening the jobs of U.S. Steel workers.” He added that while Biden has stopped the sale, “this matter is far from over.” He concluded that “we must find a long-term solution that protects the future of steelmaking in Western Pennsylvania and the workers who built U.S. Steel and built this country.”
In his own statement on Friday, Lt. Gov. Austin Davis stressed the need for a “long-term plan for keeping steel production in the Mon Valley and protecting Pennsylvania workers’ livelihoods.”
He added, “Gov. Shapiro and I will continue to work 24-7 to bring all parties together to protect Pennsylvania jobs and ensure Western Pennsylvania remains central to the future of American steelmaking.”
Staunchly against Biden’s move, U.S. Rep. Dan Meuser, a Republican who has represented parts of Northeastern Pennsylvania since 2019, denigrated it as “politically motivated.” He went on to say in a statement on Friday that blocking Nippon Steel’s bid is a “significant blow to Pennsylvania and the American steel industry.” Meuser also criticized Biden for treating Japan, an ally, as if it were “an adversary like China.”
And he said a deal would have been supported by 90% of Pennsylvania steelworkers.
United Steelworkers International President David McCall, however, expressed a different view in a statement on Friday. He that the union is “grateful” to Biden for his “willingness to take bold action to maintain a strong domestic steel industry and for his lifelong commitment to American workers.”
“We now call on U.S. Steel’s board of directors to take the necessary steps to allow it to further flourish and remain profitable,” he added.
Sen. John Fetterman (D., Pa.), the former mayor of Braddock where U.S. Steel operates a plant across the street from his home, said in a statement Friday that he would “trust and follow the wisdom and the judgment of the union,” calling the original sale proposal “a death sentence for the Mon Valley Works.”
Incoming Pennsylvania Republican Sen. Dave McCormick, who was sworn in on Friday, could not be reached for comment. During the campaign, he had called the deal “a tragedy.”
Last year, the steelworkers union unsuccessfully argued before an arbitration court that the Japanese-based company didn’t fully understand the commitment needed to its workers and surrounding communities, expressing concerns about Nippon’s labor practices and financial transparency, PBS reported. The arbitration board, however, said it recognized Nippon’s commitments to U.S. Steel — including at least a $1.4 billion investment in union-represented facilities — and allowed the deal to proceed.
Issuing a joint statement, U.S. Steel and Nippon rebuked Biden, saying they were “dismayed by President Biden’s decision … which reflects a clear violation of due process and the law.
“[T]he process was manipulated to advance President Biden’s political agenda,” the statement continued. “The President’s statement and Order do not present any credible evidence of a national security issue, making clear that this was a political decision. Following President Biden’s decision, we are left with no choice but to take all appropriate action to protect our legal rights.”
The proposal by Japan’s Nippon Steel company to buy the Pittsburgh-based steel company had been on the table for some time.
Biden had planned to block the deal in September, according to reports. But, the Washington Post reported, after Democratic officials in Pennsylvania raised alarms about potential economic and political costs of the move in that critical swing state, he agreed to postpone the decision until the presidential election was finished.
During the presidential campaign, Harris and Trump highlighted the political importance of Pennsylvania as a crucial battleground state and their belief in the United Steelworkers union as a politically powerful voting bloc.
U.S. Steel is currently the third-largest steelmaker in the country, responsible for less than 20% of domestic steel production.
Late last summer, U.S. Steel executives warned that preventing the sale would close some steel mills, eliminating thousands of union jobs and signaled that the company would move its headquarters out of Pennsylvania if the Nippon deal fell through, according to a Reuters report.