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For the head of a 177-year-old listed company, there is no hard and fast way to resist people comparing him to a mafia boss. A common strategy, though, is to avoid a 106-minute press conference in which you threaten to completely destroy your enemy, occupy his house and take his dog.
But the Convention enters 2025 bruised, confused and up against even worse shocks to come. Twenty-first century Japan is worse than evil? Is it the master villain? Is it brainwashing bloodsucking? It may not seem like it, but the country should prepare for a speech where the CEOs of American companies don’t mind saying it.
With the dog in possession, Lorenzo Goncalves, CEO of US steelmaker Cleveland-Cliffs, was prepared with a calculatedly unconventional bada bing. He’s so confident he can take everything (cars, houses, pennies) from Nippon Steel CEO Eiji Hashimoto, he told reporters he’s already started looking into the rules for exporting dogs from Japan to the United States.
Gantha is bad from there. This week’s press conference — clearly called for clarification Cleveland-Cliffs plans to buy US Steel Now President Joe Biden has blocked Nippon’s bid on national security grounds — an affront that extended beyond a conventional M&A clash. It fit comfortably into the mood of the week leading up to Donald Trump’s inauguration.
Nippon Steel filed a lawsuit accusing Goncalves of running a campaign and using tactics “more befitting of a mafia boss than the CEO of a publicly traded company” to derail its merger with US Steel. Goncalves, who said he would take legal action against Hashimoto in the United States over the allegations, responded with a blistering, blistering attack on Japan itself. In it, he warned Trump multiple times about the folly of crossing and at one point held up an American flag.
“China is bad. China is bad. China is terrible. But Japan is worse,” he added, adding, “You have learned nothing since 1945. You haven’t learned how good we are, how kind we are.” He added: “Stop sucking our blood.”
All this was very unsettling indeed. Many chose to dismiss Goncalves’ performance as uniquely delusional and the invasion of Japan as a raging, counterfactual haymaker.
A wise thing to do would be to look at it, however ugly, for its coherence, its origins and the very specific blows it lands on convention. Trump’s rise and return have been framed by some as a whirlwind series of rejections of ideas, institutions, behaviors and interpretations by him and his supporters that had long seemed indefensible. This is an environment where Japan should be wary, but at least now it has a sense of where the attack might come from.
At a key moment, Goncalves recommended his audience watch a revealing YouTube video of Trump Being interviewed by Larry King in 1987. In it, the future president railed against Japan as a “money machine” with which the United States was far more sympathetic and generous. He was tired, he said, of “watching other countries tear the United States apart”.
Trump was certainly not alone in that interpretation: a general note of dismay at US economic slippage struck just as the Japanese bubble was expanding and US dominance looked in real doubt. Profits for Japanese manufacturers of steel, electronics, cars and motorbikes, arguably, came at the expense of American rivals.
Trump may have been too busy to swallow much of the critical analysis published at the time that dissected US-Japan relations, including warnings against Japan’s industrial policies and concerns about American industrialization. But the sense of all-out economic conflict was in the ether. Benevolent America vs. Taking advantage of Japan – its companies are putting US rivals out of business even as Washington guarantees Japan’s defense.
Goncalves was not inventing the basis for the invasion of Japan, but was plucking it from a moment in history that most had long since decided to move forward with very good reasons. Japan’s relative decline is one of those; China’s emergence as a larger threat is another.
The greatest advance, however, has been the narrative of corporate America and its investors for nearly four decades deployed to convince themselves that deindustrialization is ultimately a good thing for profit and growth. That narrative may now be key to the rejection and many conventions that accompany the steady tightening of US-Japan relations.
Goncalve’s tirade may prove singular but the environment in which it emerges is becoming natural. Nippon Steel, in keeping with convention, declined to comment on whether Hashimoto owns a dog.
