Jan 11, 2025 4 min read

The acclaimed 2024 book, “When the Clock Broke,” by John Ganz, revisits the culture and politics of the early 1990s and how some of the headline-generators of those days, such as Republican presidential candidate Pat Buchanan and mobster John Gotti, helped set the table for the culture and politics of today.

It’s easy to forget now, but in that era China was not considered to be the preeminent Asian threat to the United States – back then, many a prognosticator forecast that Japan would not just eat America’s lunch, but grab its lunch money and run away fast.

Ganz writes that “fear of possible Japanese hegemony” had reached “pandemic proportions.” Barrels of ink were spilled and brows were furrowed as Japanese cars became increasingly popular in the U.S. marketplace, and venerable American brands and landmarks like Columbia Records and Rockefeller Center were sold to Japanese buyers. To add salt to the wound, it was widely reported that Japanese students were outshining their American counterparts.

As the 1990s progressed, though, the alarm about a rising Japan grew quieter and quieter as the Japanese economy went into the doldrums and America’s economy exploded as a result of the tech revolution. But it has been easy to hear some echoes of that long-ago Japan panic over the last year or so as officials considered an almost $15 billion deal by Japan’s Nippon Steel to purchase beleaguered, Pittsburgh-based U.S. Steel.

There has, perhaps, been a certain amount of wounded national pride at the idea that our erstwhile World War II foes would end up owning what was once a symbol of swaggering American industrial might. President-elect Donald Trump posted to social media that he was “totally against the once great and powerful U.S. Steel being bought by a foreign company.” And just before 2025 arrived, President Biden blocked the deal, arguing that it needed to be stopped for national security reasons.

It’s a decision that Biden – and this region – could come to regret.

The crux of Biden’s position, and those of other opponents of the deal, is that America might not be able to produce sufficient steel at some point in the future if a foreign owner decided to throttle domestic production in order to protect jobs in their homeland. They also contended the possibility of putting the brakes on production by U.S. Steel would imperil American jobs.

But this argument seems, at best, flimsy. First, Japan is a long-standing, reliable and valued U.S. ally. Also, Nippon Steel offered to give the U.S. government veto power over the production capacity of U.S. Steel. Nippon Steel also vowed that it would sink more than $2 billion into upgrading older blast furnaces at mills in this region and in Indiana, something that the company is not in a position to do on its own.

The Washington Post has reported that the deal had the support of some of Biden’s closest advisers and Cabinet officials, including Secretary of State Antony Blinken and Treasury Secretary Janet Yellen. Yet, in the end, it seems that politics and tipping the hat to union leaders who opposed the deal carried the day.

It should be noted, by the way, even as union leaders were steadfast in their opposition, the rank-and-file was reportedly divided. The fate of U.S. Steel and its employees is now in limbo, as Nippon Steel starts a long cycle of litigation to reverse Biden’s decision.

Jason Furman, who chaired the Council of Economic Advisers during the Obama administration, said on social media, “President Biden claiming Japan’s investment in an American steel company is a threat to national security is a pathetic and craven cave to special interests that will make America less prosperous and safe.”

It’s not a good note to end his presidency on.