The United States Steel Mon Valley Works Clairton Plant in Clairton, Pa., is shown on Monday, Feb. 26, 2024. President Joe Biden is opposing the planned sale of U.S. Steel to Nippon Steel of Japan. The Pennsylvania-based U.S. Steel company recently agreed to be purchased by the Tokyo-headquartered publicly traded company Nippon Steel. This deal makes sense to economists. It will encourage other foreign companies to invest in the U.S.
Such government meddling is what American steel producers get for having clamored for decades — often successfully — that they need protection from foreign competition. The Trump steel tariffs are the latest expression of this attitude. But one stupid policy move doesn’t justify a second. As soon as the announcement of Nippon’s $14.1 billion deal with U.S.
Japan has been a strong ally of the U.S. for over 60 years. In a recent piece, the Cato Institute’s Scott Lincicome and Alfredo Carrillo Obregon remind us that “the Defense Department doesn’t currently buy from U.S. Steel, and DOD needs just 3 percent of domestic steel production to meet its procurement obligations.” Furthermore, U.S.
The merged company will be able to provide for the massive demand for high-grade steel in the United States — demand exploding in no small part because of increased domestic production of electric vehicle motors. It makes economic sense for Nippon Steel to invest in this Pennsylvania-based company to meet the growing demand for steel in the U.S.