CFIUS: US Steel Review Draws Attention

The planned acquisition by Nippon Steel of what used to be America's preeminent steelmaker has stirred up a hornet's nest of jingoism and grandstanding in Washington and the Rust Belt, promising for a contentious review by the Committee on Foreign Investment in the US (CFIUS).

"President Biden welcomes foreign investment that creates new US manufacturing jobs,"  National Economic Council Director Lael Brainard said.  “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,” 

In a letter to President Biden, Sen. Jerrod Brown (D-Ohio) said he has serious concerns about the acquisition. The workers at US Steel “deserve to work for a company that invests in its employees and not only honors their right to join a union, but respects and collaborates with its workforce,” he wrote. “Given Nippon Steel’s failure to consult or even notify the United Steelworkers (USW) in advance of its acquisition announcement, I have serious concerns that they are not that company."

“Today, a critical piece of America’s defense industrial base was auctioned off to foreigners for cash,” said Sen. J.D. Vance (R-OH). “I warned of this outcome months ago and will oppose it in the months ahead."  

“It’s absolutely outrageous that U.S. Steel has agreed to sell themselves to a foreign company,” said Sen. John Fetterman, (D-PA). “Steel is always about security — both our national security and the economic security of our steel communities. I am committed to doing anything I can do, using my platform and my position, to block this foreign sale.”

United Steelworkers of America President David McCall joined the chorus of critics:   “U.S. Steel has made it clear, time and again, that its first and only priority is short-term financial gain for shareholders, even if this comes at the expense of workers, their communities and the nation’s lasting capacity to continue meeting its manufacturing needs.

“We respect the CFIUS process and will work with the appropriate parties for a thorough and successful review,” U.S. Steel said in a statement. “Japan is an important ally to the United States, and NSC [Nippon Steel Corp.] currently operates multiple steel facilities across the USA. NSC is a respected and trusted company that has made substantial commitments to support U.S. Steel’s United Steelworkers-represented employees and non-represented employees, communities, and customers. This will strengthen the American steel industry, American jobs, America’s national security, and America’s supply chain security.”

Nippon Steel is the largest producer of crude steel in Japan and the third largest in the world. US Steel ranks 24th in the world and second in the US, after Nucor Corp.