Ryan Costello: U.S. Steel-NSC Merger a good deal for workers, consumers and Pa.

U.S. Steel is one of the most iconic American brands in one of America’s most storied industries, and both have deep roots in the Commonwealth of Pennsylvania. The announced sale of U.S. Steel to Japan’s Nippon Steel Corp. (NSC) may seem like another American industry falling to foreign competition, but this is a good deal for American workers, Pennsylvania and the steel market in the United States.

The steel industry provides good paying jobs for workers across Pennsylvania and the United States. The United Steelworkers represents those workers, and the deal announced between U.S. Steel and NSC promises to honor the commitments and benefits those workers have bargained for with U.S. Steel. NSC has also said it intends to maintain the relationship with United Steelworkers.

This is good news on two fronts for workers. First, NSC is promising at the outset to be a good-faith partner to the United Steelworkers by honoring the agreement they have in place with U.S. Steel and making it clear that the company intends to maintain its unionized workforce in the United States.

Second, the United Steelworkers will have membership in a combined U.S. Steel-NSC and with other American steelmakers. We saw the success the United Autoworkers had in their recent contract negotiations in part because they could play competing automakers off each other. The United Steelworkers’ bargaining position in future negotiations with the entire industry has increased with this deal.

In addition to the industrywide benefit for workers, Pennsylvania is well served by this merger. U.S. Steel’s iconic brand will remain unchanged and the company’s Pittsburgh headquarters will stay right where it is. Any situation in which U.S. Steel’s headquarters left Pennsylvania would have been a huge hit for the commonwealth to take. Try to imagine Pittsburgh without the office workers and support staff going downtown to work every day. Even as an Eagles fan, it would be strange to watch the Steelers play on Sunday in a Pittsburgh without U.S. Steel.

The merger between U.S. Steel and NSC also prevents further consolidation within the American steel industry. U.S. Steel is a major supplier of steel for the American auto industry. If another domestic steel producer had acquired U.S. Steel, that would put American iron ore deposits and steel into the hands of one combined American steel maker. A lack of competition would drive up prices on everything from cars to infrastructure construction to military defense procurement.

At the end of the day, U.S. Steel must make the best deal it can for its shareholders. The $14.1 billion sale to NSC certainly clears that bar, representing a 40% premium for where U.S. Steel’s shares were trading the Friday before the deal was announced. However, shareholders are not the only winners. The United Steelworkers will have their contract honored and a good-faith bargaining partner in the combined U.S. Steel-NSC. Pittsburgh and Pennsylvania get to keep the U.S. Steel jobs that already were here, and our state will maintain its primacy in the American steel industry. Finally, up and down the steel supply chain, buyers will have a competitive marketplace that is not dominated by any one firm. As inflation continues to be a problem, a merger that will help keep prices down is good for consumers.

A win for workers, Pennsylvania and consumers is a good deal we should all get behind.

Ryan Costello is a former member of Congress from Pennsylvania.