Executive Summary 

• Nippon Steel’s acquisition of U.S. Steel was blocked by both Biden and Trump until Nippon, a Japanese company, gave the federal government a “golden share” of U.S. Steel. 

• The share gives the executive branch permanent control over U.S. Steel’s board of directors, job relocations, and capital investments. 

• The executive influence over this deal sets a precedent that the American government can intervene in the operations of foreign businesses, which will discourage foreign investment and open the door to unfair business practices. 

Introduction 

On June 18, the Japanese firm Nippon Steel finalized a “historic partnership” with U.S. Steel (USS), acquiring the company for nearly $15 billion. This came after years of Biden and then Trump blocking the purchase due to national security concerns. The deal was finally allowed soon after President Trump was promised a “golden share” of U.S. Steel, to be controlled by the executive branch in perpetuity. The share grants the executive control over U.S. Steel’s board of directors and their ability to close factories, change headquarters, and relocate jobs outside of the United States. Such executive influence over an acquisition threatens to alienate foreign investors, whose partnership and investments are crucial for American economic security. Trump’s golden share also sets a precedent that the U.S. government is willing to intervene in foreign businesses’ operations, which goes against traditional American separation of the public and private sectors. In fact, government intervention in foreign businesses is a tactic which the U.S. has long deemed unfair when done by China. 

The Steel Deal 

During the election year of 2023, then-President Biden cited national security concerns to block Nippon’s acquisition of U.S. Steel, a decision which Trump agreed with and later upheld. Their opinions were influenced by heavy lobbying against the deal from the United Steelworkers Union and Cleveland-Cliffs, an American bidder for USS. However, proponents of the deal argued that U.S. Steel would be forced to close factories and lay off workers without Nippon’s investment. USS CEO David Burritt argued in April that the deal “strengthens national security, strengthens economic security, strengthens job security.” 

Amidst this complicated political backdrop, both executives opted to claim that “national security concerns” justified blocking the deal. Japan is our longtime ally and a significant partner in global commerce, so calling their purchase of domestic steel factories a national security threat is a stretch, especially since Trump almost simultaneously promised a $100 billion Japanese investment into AI and other cutting-edge technologies should he win the election. The expansive power to denigrate some foreign investments as national security threats while cheering for others will likely be used again in future political battles, at a cost to the American economy. 

In June 2025, Nippon finally acquired U.S. Steel for almost $15 billion, but the terms of the acquisition had changed significantly since the original offer. During negotiations, Nippon was willing to make concessions, but the non-economic “golden share” was what finally closed the deal. The executive branch can now appoint one of three directors on U.S. Steel’s board and veto decisions regarding facilities, raw materials, and hiring. Additionally, U.S. Steel must have a fully American board of directors and keep their headquarters in Pittsburgh. 

Future foreign companies seeking to invest in the U.S. are not likely to agree to similar terms, since business owners generally like to have control over how their money is spent. Leaving Nippon’s investment decisions to the whims of President Trump, and any future American president, may decrease foreign firms’ willingness to spend within the United States. Timely decisions are also important in business, and foreign companies may not want to risk their deals being held up for years. Dissuading foreign direct investment in the U.S., which currently amounts to $5.39 trillion invested within the United States, will harm American economic security. 

Moreover, nationalizing industries is historically used solely as a last resort in the United States. President Trump himself often speaks of Chinese intervention in business as unfair, yet his golden share similarly intervenes in the private sector. If Chinese joint ventures allow for the theft of intellectual property, a joint venture with the U.S. government sounds even more dangerous to foreign companies’ intellectual property. President Trump should not have pursued a deal that empowers such tactics. 

Conclusion 

Foreign investment improves capital in industries which Americans may not want to fund, strengthens global ties, and levies the financial power needed to keep up with other countries’ large economic ventures. The American government’s “golden share” of Nippon’s business acquisition is an unfair condition which will dissuade foreign direct investment and harm U.S. economic and global interests. President Trump’s recent push to nationalize the private sector sets a precedent that endangers American enterprise, which has long benefitted from a separation of the public and private sector. Presidential power over the private sector allows politics to influence corporate decisions, sets up unfair practices, and goes against American ideals of fairness.