For the head of a 177-year-old publicly traded company, there's no hard and fast way to stop people from comparing you to a mafia boss. One traditional tactic, however, is to avoid holding a 106-minute press conference threatening to utterly destroy the enemy, occupy his house and take away his dog.
But entering 2025, the General Assembly is scarred, confused, and cowering from the worse blows to come. Is Japan in the 21st century worse than evil? Is he the villain? Could it be a brainwashed vampire? It may not think so, but the country should be prepared for conversations in which U.S. corporate CEOs don't mind saying so.
When it comes to dog possession, Lourenco Goncalves, chief executive of US steelmaker Cleveland-Cliffs, prepared an elaborate and unconventional badabine. He was so confident that he could get everything — the car, the house, every last penny — from Nippon Steel CEO Eiji Hashimoto that he told reporters he had begun studying the rules surrounding the export of dogs from Japan to the United States.
That’s where the diatribe started. This week’s press conference — ostensibly to explain Cleveland Cliffs’ plans to acquire U.S. Steel now that President Joe Biden has blocked the Japanese Steel takeover on national security grounds — had ill will that goes far beyond Traditional merger conflicts. Yet it fits the mood well in the week before Donald Trump is sworn in.
Nippon Steel has filed a lawsuit accusing Gonsalves of waging a campaign to derail its merger with U.S. Steel and using "tactics more befitting a mafia boss than a public company CEO." Goncalves said he would take legal action against Hashimoto in the United States over the accusations, and his rebuttal was a snarling, blistering attack on Japan itself. In the letter, he repeatedly warned of the folly of opposing Trump and at one point grabbed an American flag.
"China is bad. China is evil. China is terrible. But Japan is worse," he said, adding: "You haven't learned anything since 1945. You haven't learned how good we are, How merciful we are." He added: "Stop sucking our blood."
This is very disturbing indeed. Many may view Gonsalves' performance as uniquely unhinged, and the attack on Japan an angry, counterfactual haymaker.
It might be wiser to see it, no matter how ugly it is, for its coherence, its origins and its precise blow to convention. Trump’s rise and return is seen by some as a series of rejections by him and his supporters of ideas, institutions, actions and interpretations that had long seemed unimpeachable. In this environment, Japan should remain vigilant, but at least now it knows where attacks may come from.
At one key moment, Gonsalves suggested his viewers watch a YouTube video revealing Trump's 1987 interview with Larry King. In the video, the future president lambasted Japan as a "money machine" for which the United States was too tolerant and disrespectful. Generous. He said he was tired of "watching other countries copy the United States."
Trump was certainly not the only one to hold this interpretation: at a time when despair over the U.S. economic decline was widespread, the Japanese bubble was expanding and U.S. supremacy seemed to be in real doubt. There is no question that Japan's steel, electronics, car and motorcycle makers have grown at the expense of their American rivals.
Trump was probably too busy to digest the many serious analyzes published at the time that dissected U.S.-Japan relations, warned about Japanese industrial policy, and expressed nervousness about American deindustrialization. But the feeling of full-blown economic conflict is in the air. A benevolent United States versus a taking advantage of Japan—While Washington ensured Japan’s defense, Japanese companies bankrupted their American competitors.
Goncalves did not invent the basis for attacking Japan, but rather drew it from a historical moment that most people, for many good reasons, had long since decided to abandon. Japan's relative decline is one of them. The emergence of China as a greater threat is another issue.
Most important in this process, however, is the narrative that corporate America and its investors have been using for nearly four decades to convince themselves that deindustrialization is ultimately a good thing for profits and growth. That argument may now be rejected, along with many of the conventions that accompany the steady tightening of U.S.-Japan relations.
Gonsalves' tirade was likely a one-off, but the circumstances in which it occurred were normalizing. Nippon Steel declined to comment on whether Hashimoto has dogs, as is customary.
leo.lewis@ft.com