MARY LOUISE KELLY, HOST:
President Biden reportedly plans to block the sale of U.S. Steel to a Japanese steelmaker. The move has union leaders cheering. It has some business observers scratching their heads. And this is all playing out in Pennsylvania, a key battleground in the November election. NPR's Scott Horsley joins me now. Hi, Scott.
SCOTT HORSLEY, BYLINE: Hi, Mary Louise.
KELLY: So this is - it's that very rare thing, a case where Democrats and Republicans seem to be in agreement. What's going on?
HORSLEY: Yeah. Ever since Japan's Nippon Steel company announced back in December that it wanted to buy U.S. Steel, there has been bipartisan blowback. President Biden spoke out against the sale. So did former President Trump. And this week Vice President Harris joined the chorus of opposition. Here she is speaking at a Labor Day rally in Pennsylvania.
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VICE PRESIDENT KAMALA HARRIS: U.S. Steel is an historic American company, and it is vital for our nation to maintain strong American steel companies. And I couldn't agree more with President Biden. U.S. Steel should remain American-owned and American-operated.
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HORSLEY: Now, the steelworkers union has also bitterly opposed the sale. International union president David McCall worries that Nippon Steel would use the acquisition to funnel cheap Japanese steel into the United States.
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DAVID MCCALL: We're not allies in terms of trade. They have, over the years, dumped material in this country. And they're really exporting their unemployment to the U.S., which causes our unemployment.
HORSLEY: Now, yesterday the Washington Post and other news outlets reported that President Biden is ready to formally block the sale on the grounds that it would be harmful to national security.
KELLY: To formally block the sale, which does seem unusual. How common is it for the government to intervene in that way?
HORSLEY: Yeah. It's pretty rare. It's only happened eight times before, and it's especially unusual when the would-be buyer is from a friendly country like Japan. Nippon Steel has promised to invest nearly $3 billion to modernize U.S. Steel plants in Pennsylvania and Indiana. Nancy McLernon, who heads a trade group of foreign-owned companies called the Global Business Alliance, worries what kind of signal it would send if the U.S. closes the door on that kind of foreign investment.
NANCY MCLERNON: It is hard to envision how this deal would impact national security. And to block a deal like this would send a message that we are moving toward an isolationist policy, which could definitely have an impact on U.S. economic growth.
HORSLEY: McLernon notes foreign-owned businesses employ almost 8 million people here in the United States, many of them in the very manufacturing sector that both Biden and Trump say they champion. Of course, both Biden and Trump have used tariffs and other protectionist measures to try to shore up the domestic steel industry, often at the expense of companies here in the country that use steel.
KELLY: Scott, what happens if this sale is blocked? What happens next?
HORSLEY: Well, that could backfire. U.S. Steel CEO warned this week that if this deal falls through, the company might pivot away from its big blast furnaces, jeopardizing thousands of union jobs. He even suggested the 123-year-old steelmaker could move its headquarters out of Pittsburgh. Adam Green, who tracks the steel industry at World Steel Dynamics, says that's not an idle threat. And Green thinks that clear-eyed economic assessment has been warped by politics during this election season.
ADAM GREEN: The fact that this is all happening in Pennsylvania state that was decided by 80,000 votes is maybe playing an outsized role in all of this and, yeah, perhaps as a result, they're - they would be getting, yeah, slightly less attention.
HORSLEY: For all the nostalgia surrounding U.S. Steel, it's not the industrial giant it once was. It's now only the third biggest steelmaker here in the U.S., accounting for less than 20% of domestic steel production.
KELLY: Thank you, Scott.
HORSLEY: You're welcome.
KELLY: NPR's Scott Horsley.
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