What happens if you install the latest package from here: http://repo.steampowered.com/steam/
Then remove ~/.steam ~/.local/share/Steam
And then run steam by itself: steam
If you still get that issue, can you show the output of ls -l ~/.steam after you do the above steps?
I believe this issue is fixed. Please reopen the bug with steps, if you're still running into it.
Nothing extracted yet.
On AMD64/Radeon HD 5970 (fglrx-updates)
workaround: Install steam, launch steam from terminal by typing "steam steam", reinstall steam whenever you reboot or you get the same error
terminal from install to open: