Howard Lutnick, commerce secretary, talks U.S. Steel and "golden share"

Commerce Secretary Howard Lutnick shared details Monday of the unique relationship between the federal government and U.S. Steel, including the power the government has through its "golden share" of the company.

While not giving the U.S. a financial stake in Pittsburgh-based U.S. Steel, the "golden share" gives the government the ability to veto certain major U.S. Steel decisions. It's part of a national security agreement that closing the deal hinged on. 

Impact of the golden share

The comments came in response to questions posed by KDKA-TV at an event at the historic Edgar Thomson Plant in Braddock that celebrated a year since the deal closed. 

"Has the US government exercised its golden share at all over the past year, and if not directly, has there been any indirect impact on U.S. Steel decision-making at all?" KDKA asked. 

"A little bit," Lutnick responded.

Asked how, Lutnick explained that a company's ordinary DNA is to maximize profit, but the government wants to "maximize mission." The company, he says, has to take into account the government's mission when looking at cost-saving measures. 

"It's fine for us when they think they want to make a move that makes another dollar, but they've got to weigh that with the golden share of the United States of America that says, 'Well, we're here, and the only reason we're here is because we care about the American steel workers, and we care about a growth of American steel,'" Lutnick said. 

Lutnick indicated they have not had to use their golden share because they have all largely been on the same page. 

"The key to the United States of America's involvement is, I think, the best way to say it is noses in, fingers out," Lutnick said. "That means we let them run their business; that is their business. We just want to make sure that the mission is being achieved and the mission is pounding forward."

U.S. Steel and federal government 

He explained what would happen if U.S. Steel were to think about making cuts.

"We're sort of in the mix with them, just chatting with them, just talking and saying, look, let's figure out a way instead of cutting. Let's figure out a way to grow, to build, let's make sure you can win by being bigger, by being stronger," Lutnick said. 

Asked by KDKA-TV if they encouraged U.S. Steel to reopen the Gary Tin Mill in Indiana, Lutnick said he'd leave the details of "how he wants to play his company going forward" to CEO David Burritt. 

He said the beauty of the Trump administration is that when things do come up, Burritt can call Lutnick, a businessman, to talk for a minute, or President Trump, also a businessman, and have a 30-second conversation. 

"We understand that together, and we can always work it out. So, I'm excited by the fact that just in the little time we've been together, we've always worked it out. And the answer has always been more production, more employment, more growth. Let's go with it," Lutnick said. 

U.S. Steel has been looking at several sites for a new plant. Asked where it could be in Pennsylvania, Burritt said:

"I'd love to have it here in Pennsylvania, but obviously there's an economic study that goes on, there's environmental studies that go on, there's also making sure that we have the right logistics wherever we put this. But we have a lot of optionality."

Lutnick visits Braddock

Lutnick's visit came on the same day U.S. Steel announced details of a big investment in the historic Edgar Thomson plant. A new hot strip mill will be built on the property, used for turning steel slabs into coils. 

The company also shared an economic analysis for the strip mill, which shows how a $2.5 billion investment would create 6,381 total jobs, 3,201 of them being direct jobs. 

The new mill was not discussed by either Lutnick or Burritt at Monday's event, which featured a large number of U.S. steelworkers supporting their leadership. U.S. Steel spokespeople declined to make anyone available to specifically discuss the new strip mill. 

Burritt did mention that they would be investing $2.5 billion into the Mon Valley Works, up significantly from the original amounts. 

"I can clearly say our best days are ahead," Burritt said. 

He said the investments coming to the Mon Valley are, in large part, due to Lutnick and his team. 

"They said the deal would never close," Burritt opened the event with. "And yet here we are, recognizing people that made it happen." 

Lutnick credits Trump

Lutnick said that because of Mr. Trump, U.S. Steel is going to thrive. 

"While Washington slept, foreign countries, they wern't asleep. They were subsidizing, they were dumping," Lutnick explained. 

To compete, Mr. Trump imposed steep tariffs on steel, which his department enforces, adding that they are already seeing results. 

"America wins by not depending on others for what matters most," Lutnick said, stressing the role steel plays in national security. 

Part of doing that includes the golden share that was agreed to in the deal with Japan-based Nippon. As part of the agreement, a U.S. Steel board member reports directly to Lutnick and David Shapiro.

Burritt praised him, saying he's been helpful because he's looking for opportunities to make U.S. Steel stronger.

When Lutnick was asked if Nippon had held up their end of the deal so far, he said they had.

"We're investing here in the future," Burritt said. "And all I can say about the way we do business in Pennsylvania: You ain't seen nothing yet."