In a major reversal, President Donald Trump traveled to Pennsylvania on Friday to announce a deal with Japan’s Nippon Steel that would give the U.S. government a controlling role in U.S. Steel under a merger arrangement.
Trump received applause from the assembled steelworkers at U.S. Steel’s Irvin Works plant near Pittsburgh when he announced he would increase his tariffs on imported steel to 50 percent, up from 25 percent.
“For generations, the name United States Steel was synonymous with greatness, and now it will again be synonymous with greatness,” the president said to cheers. “That’s what we’re trying to do — the best and strongest steel on earth will forever be made in America and made in Pennsylvania.”
Under the deal with Nippon, the new company would have an American CEO and a majority of board members from the United States — and the federal government would have final approval over key corporate decisions and functions. The deal would guarantee all existing blast furnaces would remain operational for the next decade and mean “no layoffs,” Trump told the steelworkers.
The longtime businessman also vowed that the new steel company would make those in attendance wealthy.
“There’s a lot of money coming your way. It’s a lot of money. You’re going to say, ‘Please, sir, we don’t want this kind of success.’ But we do, don’t we?” Trump said as he declared that Pittsburgh would remain the headquarters of the new U.S. Steel. He added that Nippon would be a “great partner” in the revised company and that the two sides would have a “tremendous relationship.”
Positioned behind the stage from which Trump spoke were large blue signs that read “American Jobs” and “The Golden Age” and “American Steel.” After about five minutes, Trump had already changed topics, telling the crowd that his tariffs had brought in “billions and billions of dollars.”
Evolving views
Trump and his top trade and manufacturing advisers had insisted since he took office that any merger arrangement between Nippon and U.S. Steel would have to feature a controlling role for the U.S. government and American leadership atop the new company.
But the president’s stance on the merger has evolved over time. In his 1987 book “The Art of the Deal,” Trump advised readers to avoid getting too attached to the terms of any one possible deal and to keep a lot of options on the table, because most proposed agreements fall apart.
President Joe Biden on Jan. 3 formally blocked Nippon’s attempt to acquire U.S. Steel after long opposing the proposed transaction, arguing that such a move would undermine national and economic security. As recently as December, while still president-elect, Trump was clear in his opposition, as well.
“As President, I will block this deal from happening,” Trump wrote on social media on Dec. 2, marking a rare agreement with Biden, adding: “Buyer Beware!!!”
But after taking office, Trump began to warm to the notion of a partnership that would leave final say over U.S. Steel’s business moves in American hands. He started touting Nippon’s proposal to invest at least $14 billion in U.S. Steel’s domestic operations as a win for his push to remake the United States into a “manufacturing superpower.”
Pennsylvania Sen. Dave McCormick this week described the U.S. government’s role in the new U.S. Steel as “a golden share.”
The agreement Trump announced Friday would “essentially require U.S. government approval of a number of the board members and that will allow the United States to ensure production levels aren’t cut,” the Republican senator told CNBC.
McCormick, a Trump ally, estimated the Nippon deal would salvage up to 10,000 jobs in the Keystone State and add 10,000 to build and operate another arc furnace at a to-be-determined location.
Still, Japan’s Nippon would “have, certainly, members of the board and this will be part of their overall corporate structure,” said McCormick, who revealed that he and other lawmakers met with Trump late last week about the emerging pact, which the senator has described as a win-win for both sides.
“They wanted an opportunity to get access to the U.S. market — this allowed them to do so and get the economic benefit of that,” McCormick said, referring to Nippon. “They’ve negotiated it. It was their proposal.”
‘Vital American company’
Before his trip to the Pittsburgh-area steel facility was announced by his staff, Trump on Sunday had tipped his hand.
Speaking to reporters while returning to the White House from a golf weekend at his New Jersey resort, Trump said the new U.S. Steel would be “controlled by the United States,” adding: “Otherwise, I wouldn’t make the deal.”
The president also provided his version of how the agreement with Nippon came together.
“I went to the unions, to … all of the local unions. They all wanted it. And I’m doing it because all of the congressmen came in, about five of them, and the others I understand are in conference, and they asked that I do it,” Trump said. “Everybody seems to want it. And we’ll see.”
“They’re going to invest billions of dollars in steel, and it’s a good company,” Trump said. “Nippon is a very good company. We’ll see. But it would be, it’s an investment and it’s a partial ownership, but it’ll be controlled by the USA.”
Biden spent his final weeks and months in office, in part, explaining why he opted to block the steel merger.
“It is my solemn responsibility as president to ensure that, now and long into the future, America has a strong domestically owned and operated steel industry that can continue to power our national sources of strength at home and abroad; and it is a fulfillment of that responsibility to block foreign ownership of this vital American company,” he said in a Jan. 3 statement.
But some conservative analysts called Biden’s decision a mistake, while urging the incoming president, Trump, to reverse it.
“Politics may stop at the water’s edge, but the effects of Biden’s decision to block this deal with be felt both domestically and internationally,” Zack Cooper, a former National Security Council staffer and now a senior fellow at the right-leaning American Enterprise Institute, wrote the day of Biden’s announcement. “This may not be his administration’s last major national security decision, but it is certainly one of its worst.
Cooper added presciently: “It is theoretically possible that US officials could eventually come to their senses.”
Trump’s visit to Pittsburgh also placed him in a battleground state he won in the 2016 and 2024 presidential elections. To that end, at several events since he defeated Kamala Harris in November, Trump has credited Pennsylvania as being one of the keys to his victory — especially after Biden had carried the state in the duo’s 2020 race.
“I’m thrilled to be back in this beautiful commonwealth,” he told the crowd Friday. “You voted.”
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