Planet Money: The President's Golden Share in U.S. Steel – Detailed Summary

Release Date: July 25, 2025

Introduction

In the July 25, 2025 episode of Planet Money, NPR delves into the controversial and unprecedented sale of U.S. Steel to Nippon Steel, a Japanese company. Hosted by Erica Barris and Sally Helm, the episode explores the intricate interplay between foreign investment, national security, and government intervention in the American steel industry.

Background: The Sale of U.S. Steel

The episode begins by highlighting the decline of the American steel industry. Erica Barris introduces listeners to the challenges faced by U.S. Steel, noting that while once a powerhouse employing thousands, the industry now sustains only a fraction of its former workforce. A pivotal moment occurred when U.S. Steel announced its intention to sell to Nippon Steel, a move that was met with widespread concern, especially given Pennsylvania's status as a swing state during the election cycle.

Notable Quote:

"The American steel industry is not what it used to be. There were once dozens of steel plants employing many thousands of people. Now they employ just a few thousand." – Sally Helm (01:18)

Government Intervention and CFIUS

As the sale was announced, bipartisan political figures expressed alarm over the potential foreign ownership of a critical American industry. Initially, President Biden intervened, blocking the sale on the grounds of national security. However, the Trump administration later reversed this decision, approving the sale with a stringent set of conditions aimed at safeguarding American interests.

Central to this intervention is the Committee on Foreign Investment in the United States (CFIUS), an interagency body responsible for reviewing and approving foreign investments in U.S. companies to ensure they do not pose national security risks. Erica Barris explains the expanded role of CFIUS under both the Trump and Biden administrations, emphasizing its broader definition of national security to include economic factors such as cybersecurity, AI, and clean energy.

Notable Quote:

"CFIUS was created to make sure those companies and people don't mess with US Interests." – Sarah Bowerly Dansman (07:04)

The Deal's Terms: Introducing the Golden Share

The crux of the episode revolves around the unique conditions imposed on Nippon Steel's acquisition of U.S. Steel. Dubbed a "golden share" by President Trump, this arrangement grants the U.S. government significant governance rights without actual equity ownership. This departure from traditional golden share models raises questions about its implications and uniqueness.

Notable Quote:

"We have a golden stock. We have a golden share, which I control or president controls." – Donald Trump (12:40)

Despite the nomenclature, experts clarify that the U.S. government does not hold an actual equity stake in U.S. Steel. Instead, it possesses special governance rights that allow for veto power over critical decisions, such as relocating headquarters or altering investment plans.

Understanding the Golden Share

The concept of a golden share isn't novel globally. Originating in the UK during the Thatcher era, golden shares allowed governments to retain control over privatized industries deemed vital for national interests. Countries like Russia, China, and Brazil have adopted similar mechanisms to balance free-market operations with state oversight.

Notable Quote:

"A golden share is a different class of shares in which a government can own a very small percentage of the company but has outsized voting rights." – Unnamed Expert (14:10)

However, the U.S. arrangement stands out as it doesn't involve actual share ownership but mimics the control typically associated with golden shares through contractual agreements.

Unique Aspects of the U.S. Deal

The U.S. government's approach in this deal deviates from traditional golden share implementations. Instead of holding a minority stake, the government exercises control through a National Security Agreement, granting veto power over significant corporate decisions directly to the President.

Notable Quote:

"The golden National Security Agreement outlining certain provisions and stipulations governing Nippon Steel's acquisition of US Steel didn't really have the same ring to it." – White House Representative (17:33)

This unprecedented move has sparked debates among economists and policymakers about the balance between protecting national interests and maintaining a free-market economy.

Implications and Reactions

The episode discusses the potential repercussions of such government intervention. While the deal ensures the survival of U.S. Steel and preserves jobs, it may deter future foreign investments due to increased regulatory oversight and reduced autonomy for acquired companies. Economists express concerns that this could slow down the growth of the manufacturing sector and hinder the attractiveness of the U.S. market for international investors.

Notable Quote:

"Buying US Companies is probably going to be seen as a less lucrative or have less of an upside." – Sarah Bowerly Dansman (25:10)

Comparisons to Previous Government Interventions

Drawing parallels to the 2008 financial crisis bailout of General Motors, where the government took an active role to steer the company back to profitability, the episode highlights the fine line between support and control. While GM received substantial government funds to prevent bankruptcy, the U.S. government's role in the U.S. Steel deal represents a more permanent and direct form of influence without ownership.

Notable Quote:

"The closest thing we have to our government owning a company is Amtrak. The US Government is a majority shareholder, so not a small shareholder with Special powers like a golden share." – Sally Helm (21:27)

Conclusion: Balancing Act Between Security and Market Freedom

Planet Money concludes by pondering the future of foreign investments in the U.S. steel industry and beyond. The unique "golden share" arrangement sets a precedent that could reshape how the U.S. balances national security with economic freedom. While it ensures the preservation of key industries and jobs, it raises essential questions about the long-term implications for market dynamics and international investor confidence.

Production Credits

This episode was produced by Willa Rubin, edited by Marianne McCune, with research assistance from Emily Crawford and Emma Peaslee. Fact-checking was handled by Cierra Juarez, engineering by Robert Rodriguez, and Japanese translation by Yuki Noguchi. Executive production was led by Alex Goldmark.

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