Biden vows to bar US Steel buyout, add more tariffs
PITTSBURGH — President Biden promised cheering unionized steelworkers on Wednesday that his administration would block the acquisition of US Steel by a Japanese company, and he called for a tripling of tariffs on Chinese steel, seeking to use trade policy to win over working-class votes in Pennsylvania, an electionyear battleground.
Biden said during a visit to the headquarters of the United Steelworkers union that US Steel “has been an iconic American company for more than a century, and it should remain totally American.”
“American owned, American operated by American union steelworkers — the best in the world — and that’s going to happen I promise you,” the Democratic president said.
His administration is reviewing the proposed acquisition by Japan’s Nippon Steel. Biden said last month he would oppose the deal, saying it was “vital for it to remain an American steel company that is domestically owned and operated.”
But in front of a pro-union audience, he went far further. “The backbone of America has a steel spine,” Biden said.
In another move that his administration argues can protect domestic steelworkers, Biden is pushing for the higher tariffs on Chinese steel and aluminum, aiming to insulate American producers from a flood of cheap imports.
While the announcements reflected the intersection of Biden’s international trade policy with his reelection effort, the White House insisted they were more about shielding American manufacturing from unfair trade practices overseas than firing up a union audience.
The current tariff rate is 7.5 percent for both steel and aluminum but could climb to 22.5 percent. Biden said he was asking his trade representative to raise the tariffs.
The administration also promised to pursue investigations against countries and importers that try to saturate existing markets with Chinese steel and said it was working with Mexico to ensure that Chinese companies cannot circumvent the tariffs by shipping steel there for subsequent export to the United States.
“The president understands we must invest in American manufacturing. But we also have to protect those investments and those workers from unfair exports associated with China’s industrial overcapacity,” White House national economic adviser Lael Brainard said.
As Biden was greeted by a small group of steelworkers upon his arrival, one said, “Keep US Steel in America.” Biden responded: “Guaranteed.” And in his speech, the president told the crowd, “It ain’t labor, it’s unions.”
He was on a three-day Pennsylvania swing that began in his childhood hometown of Scranton on Tuesday and will include a visit to Philadelphia on Thursday.
In a brief exchange with reporters before leaving Scranton, Biden was asked about the escalating trade tensions with China, and he responded, “No trade war.” Later, at Scranton’s war memorial, Biden crouched down and ran his fingers along the name of one of the fallen — uncle Ambrose J. Finnegan Jr., who died in World War II.
The announcement on steel tariffs was cheered by US steelmakers. Kevin Dempsey, president of the American Iron and Steel Institute, accused China of disrupting “world markets both by subsidizing the production of steel and other products and by dumping those products in the US and other markets.”
The tariff move, however, is largely symbolic.
The US imported roughly $6.1 billion in steel products in the 12 months ending in February 2023, but just 3 percent of those imports came from China, according to Census Bureau figures. Citing already existing trade barriers, the American Iron and Steel Institute said China last year accounted for just 2.1 percent of US steel imports, making it America’s seventh-biggest source of foreign steel.
Meanwhile, US Trade Representative Katherine Tai announced that her office, acting on a petition from five national labor unions, was investigating China for “targeting the maritime, logistics, and shipbuilding sectors for dominance.”
“The allegations reflect what we have already seen across other sectors,” Tai said in a statement.
The administration has accused China of more broadly distorting markets and eroding competition by unfairly flooding the market with below-market-cost steel.
“China’s policy-driven overcapacity poses a serious risk to the future of the American steel and aluminum industry,” Brainard said. Referencing China’s economic downturn, she added that Beijing “cannot export its way to recovery.”