US Steel future in limbo after Biden block
The fate of the Edgar Thomson Works, a massive steel plant at Braddock, Pennsylvania, that has hugged the same spot along the Monongahela River since 1875, became even more uncertain Friday morning when President Joe Biden announced he would block the sale of United States Steel to Nippon Steel as one of his last acts as president.
Biden said he blocked the $14 billion takeover of U.S. Steel by Japan’s Nippon Steel on the grounds the sale was a threat to national security.
Gov. Josh Shapiro (D-Pa.) and Pennsylvania Lt. Gov. Austin Davis, who grew up in the shadow of one of the Mon Valley plants, released dual statements on the Biden move. Shapiro said, “Since the day this proposed deal between U.S. Steel and Nippon Steel was announced, my team and I have been engaged in intensive dialogue with all parties involved — and my top priority, as always, has been protecting Pennsylvania workers and fighting for a better future for our Commonwealth.”
The Montgomery County Democrat has told me in previous interviews that he had been working nonstop to try to broker a deal with all parties.
Shapiro said he expects U.S. Steel to uphold its commitments to Western Pennsylvania and work collaboratively to ensure the future of American steel making takes place here in Pennsylvania, adding he will continue to engage with all interested parties directly to get a deal done.
Davis said that for him, the matter is personal. “I grew up and still live in the shadow of U.S. Steel plants,” he said. “I went to high school with people who work at the Mon Valley Works. I know the pain and frustration of my neighbors who watched as the steel industry collapsed, laying off thousands of workers and shuttering factories, while leaders in Washington did nothing. I’m deeply concerned this is happening again — and that is unacceptable.”
Nippon released a statement on Friday saying it was “left with no choice but to take all appropriate action to protect our legal rights.”
U.S. Steel was once the world’s largest corporation. Its origins reach back to business titans Andrew Carnegie and J.P. Morgan when, in 1901, Morgan financed the merger of Carnegie’s Carnegie Steel Company with eight other smaller steelmakers for just under $500 million.
Charles M. Schwab served as the first president of the merged entity, and almost immediately, U.S. Steel became the most iconic manufacturing company in the world. It placed Pittsburgh on the map as a powerhouse of industry, and over the decades, the city was so identified by U.S. Steel’s economic and cultural impact that its NFL franchise football team was named after it.
The former U.S. Steel building, located on Grant Street in downtown Pittsburgh, was hailed as an engineering marvel and honored the geography of the city with its triangular shape. It also honored the grit of its people with its “rusty nail” exterior.
It remains to this day the tallest skyscraper in Appalachia, but the logo on the top now reads “UPMC.”
U.S. Steel’s demise began in the ’70s — a collapse that eviscerated good, well-paying jobs, causing many families to have to sprint across the country in search of employment.
By 1984, the number of steelworkers in Pittsburgh dropped from 90,000 to 44,000 in just four years.
Sentiments here in Western Pennsylvania over the blocked merger are mixed. Allegheny County at-large Councilman Sam DeMarco, a Republican, is for the sale to Nippon, telling the Washington Examiner that he is very disappointed to see Biden block the Nippon Steel-U.S. Steel merger.
Biden, DeMarco adds, “owns this.”
In a joint statement, U.S. Steel and Nippon Steel said they were dismayed by Biden’s decision to block Nippon Steel’s acquisition of U.S. Steel, adding his decision reflects a clear violation of due process.
Nippon Steel and U.S. Steel said they are confident their transaction would revitalize communities that rely on American steel, provide job security for American steelworkers, enhance the American steel supply chain, help America’s domestic steel industry compete more effectively with China, and bolster national security.
President-elect Donald Trump has not issued a statement as of deadline.
Sen. John Fetterman (D-Pa.), whose home is next door to the Edgar Thomson plant, said the acquisition of U.S. Steel by a foreign company is wrong for Pennsylvania and that he would continue to do everything he can to block the sale.