Nippon Steel’s announcement that it plans to purchase U.S. Steel has triggered an uproar in the United States.
Even though the offer is a sweet deal for the U.S. company’s shareholders, several politicians have pledged to block the sale, arguing that it undermines U.S. national security.
This is an important test for the Biden administration. There is no reason to prevent the acquisition. Allowing it to proceed will be proof of the U.S. government’s commitment to collective action to safeguard supply chains in critical products. Failure to do so would indicate that Washington’s concern is protectionism, rather than genuine national security. It would antagonize and alienate a critical partner. It would be a mistake.