One of my principle objections to the whole Trump movement is its ill deserved label of conservative. Mr. Trump is the same 1990s big government Democrat he always has been, with the exception of his conversion on pro-life issues during his first term, where he can legitimately be described as the most pro-life president we’ve ever had. It remains to be seen whether he will continue that marriage (of convenience?) in his 2nd term. But to get to that 2nd term, he continues to double down on all the bad economic ideas of his first term to placate special interests. We’re all aware of the outrageous judgment of New York’s civil trial against Mr. Trump (a topic for another day), but the outrage is primarily in the size of the judgment–almost half a billion dollars. The ability to take someone’s property is the power to destroy, which is why conservatives always need to be on the side of private property rights (or more appropriately, private stewardship responsibilities). Property is part of God’s good design, and is grounded in both the 8th and 10th Commandments. When you have legal rights to property, that means you have the right to sell it, to enjoy it, to improve it, etc as long as your actions with your property don’t impinge on the rights of others. You are the delegated sovereign of that property, or more properly, you are the steward of the King with respect to it.

Yesterday I noted that Trumpians are in favor of enterprise, just not the free part. I’ve condemned Mr. Trump’s trade policies before (which his current policy proposals are far worse than his first term), but his lack of support of free enterprise goes well beyond trade. His support of big government necessarily means he’s in favor of a smaller private sector–just like Mr. Biden. His support of favored industries and groups (e.g., the steel and aluminum industry vs the much larger U.S. steel and aluminum using industries) is not categorically different than Mr. Biden or Mr. Sanders. But his economic nationalism is where he is at his worst–he abandons the principle of private property, ironically the very principle that is at the core of the injustice being done to him right now in New York.

How so? Mr. Trump and Mr. Biden are now both on record as being against Nippon Steel’s purchase of the American steel company, U.S. Steel. Here are the basic facts. Nippon Steel won a bidding war last summer over U.S. based Cleveland-Cliffs to buy U.S. Steel. The headquarters of U.S. Steel would remain in America, Nippon Steel would honor all union contracts, and the shareholders of the company–the owners of the company–were given a 40% premium over the stock value prior to the deal. According to the WSJ, Nippon Steel offered roughly double Cleveland-Cliffs offer. Nippon Steel announced plans to invest $1.4B in capital upgrades to U.S. Steel operations to make the firm more competitive in the global steel competition. But Cleveland-Cliffs wants to win this the new American way: political cronyism. As the WSJ reports,

President Biden and the self-styled populists in Congress claim to represent the common man, but what they actually stand for is corporate and union rent-seeking.  “I’m not surprised. We have been in total contact with the administration, so I know what’s going on,” Mr. Goncalves boasted to Bloomberg News after Mr. Biden on Thursday issued a statement opposing Nippon Steel’s $14.1 billion acquisition. It’s nice if you know the king. Mr. Goncalves added: “The contact is about making it abundantly clear between me and [United Steelworkers union president] Dave McCall that the only buyer the union accepts for the union-represented assets is Cleveland-Cliffs.” The United Steelworkers, which represents workers at Cleveland-Cliffs and U.S. Steel, has backed a merger between the American steel giants.

With either Trump or Biden, a combined U.S. Steel/Cleveland Cliff’s would have monopoly power within the U.S. over much of the steel used in the auto industry. They would then be free to raise prices and have the government raise the tariff (Mr. Trump, aka Tariff Man, would gladly do their bidding–he’s done it before). As the WSJ notes:

Mr. Goncalves and the United Steelworkers don’t share those goals. They want to create a U.S. steel-making monopoly that is protected by tariffs from foreign competition. A Cleveland-Cliffs-U.S. Steel merger would control 100% of blast furnace production in the U.S. and 65% to 90% of domestic steel used in vehicles.

Cleveland-Cliffs could then raise prices, and the union could negotiate richer wages and benefits, without worrying about competition. U.S. manufacturers and consumers would be harmed, but who cares about them? Not Mr. Biden or the Members of Congress opposing the Nippon deal, including Republican Sens. J.D. Vance, Josh Hawley and Marco Rubio. The Biden antitrust cops also seem to have taken a powder on this one.

So who are the losers of this special interest political theater? Most importantly, the rule of law and private property rights. Yes we have limitations on private property rights, e.g., national security reasons. But Japan is one of our closest allies and steel is an international commodity available from many sources (and remember, the Nippon Steel purchase would result in a larger American steel industry with the $1.4B investment, not smaller!). Indeed, we would be more nationally secure through a more robust U.S. Steel that is modernized by investment and combination with Nippon Steel. But shareholders own this business, and ought to be able to sell to the highest bidder, not to the most politically connected. And the poor American consumer, already ravaged by Biden’s inflation, shouldn’t have to pay yet further higher prices to placate some American special interest. It is the general welfare, not the special interest, that Washington DC should be concerned about. Alas, whatever differences you may think Mr. Biden and Mr. Trump have, in this area they are two peas in a pod.

Edit Update: One more way to think about this. In 2009ish, President Obama overrode the rule of law (contract law) and gave General Motors to the unions. In that case, it was the creditors who had their property rights taken, since the shareholders were wiped out. In this case, President Biden is proposing to take half of the the company and give it to the unions, since they will receive a value much lower than Nippon Steel would have made. Political corruption indeed.

Edit Update: See Veronique De Rugy’s great complementary post that came out today