The claim that the “Buy American” provision now within the Obama "stimulus" bill is unnecessarily protectionist is absurd, in spite of the protests of the Washington Post and much of the present day leadership of the Republican Party. We agree here with Democrat Senator Byron Dorgan, when he responds to the Post editorial as follows: “We're a country with a 700 billion dollar trade deficit. It's absurd for somebody to suggest we're protectionist. They must not have understood that we've got about a 2 billion dollar a day deficit in trade."
Free trade is desireable, but there is no free trade without fair trade; and our various competitors, in one way or another, have been stacking the decks against American manufacturing for a long time now under a ruse of “free trade," as they routinely provide in their own legislation for special supports, if not outright subsidies, for the preservation of their own industrial and manufacturing economies. They have not forgotten a lesson that we used to know, when we were arising as a great, industrial power in our own right in the nineteenth and twentieth centuries: Nations that pursue policies of self-promotion – and most especially in a manner that allows for greater self-sufficiency – are able to grow prosperous and to maintain their own sovereignty; while Nations that give away the store are akin to bloated supernovas, that crash in upon themselves under their own, towering trade and fiscal deficits. As nationalists, and as Republicans steeped in the traditions that were once held firmly by our own party, we support the former over the later: a rebirth of the American Nation, one not afraid of our commerce with the world, but also undeterred from looking out for our own, distinct, national self-interest (and not confusing that national self-interest with a globalist commerce that knows no borders and has no loyalties at all to our own, American workers).
Steel-State Lawmakers Vow to Save “Buy American” in American Economic Alert
WASHINGTON (Reuters) - Lawmakers from steel-producing states insisted on Wednesday that a "Buy American" plan remain part of the huge U.S. economic stimulus bill after President Barack Obama said Congress should look at dropping or changing it to avoid starting a trade war.
"If it's not in, I'm not supporting this package and I'll bring a lot of votes with me," House of Representatives Transportation Committee Chairman James Oberstar, a Minnesota Democrat, said after a Congressional Steel Caucus hearing.
Senator John McCain, an Arizona Republican, was expected to offer an amendment to strip the Buy American provision from the Senate's stimulus bill, while other lawmakers were working on changes to make sure it was consistent with U.S. trade pacts.
Obama, in television interviews on Tuesday, said the United States had to be careful not to include any provisions in the stimulus plan that could "trigger a trade war."
"I think it would be a mistake ... at a time when worldwide trade is declining, for us to start sending a message that somehow we're just looking after ourselves and not concerned with world trade," Obama said on the Fox network.
His comments came as the Senate debated a nearly $900 billion stimulus plan that would allow only U.S.-made iron, steel and manufactured goods to be used in public works projects funded by the bill.
That built on a $825 billion stimulus plan passed last week by the House that required the use of U.S.-made iron and steel in public works projects.
Canada and the European Union have pressed Congress this week to drop the provision, which critics say could violate the North American Free Trade Agreement and a World Trade Organization government procurement pact.
Senator Byron Dorgan, a North Dakota Democrat who crafted the Senate's Buy American provision, said he was working with the White House and his colleagues to ensure it "would not violate our international trade agreements."
STUDY RANKLES STEEL CHIEFS
Steel company executives, who saw demand plummet in the last half of 2008 as the recession deepened, argued vigorously at Wednesday's hearing for the provision, which they said opinion polls showed had widespread public support.
"The American people are with us and with you on this issue," Dan DiMicco, chief executive of Nucor Corp, told the steel caucus members.
He dismissed as "complete garbage" a study done by the Peterson Institute for International Economics that concluded the Buy American provision would create as few as 1,000 new jobs and possibly cost the United States many more if trading partners closed their public works projects to U.S. exports.
"You can get a study done on anything you want. I'll give you another statistic -- for every billion dollars in infrastructure spent in this country, studies have shown you will create between 30,00O and 40,000 new jobs," DiMicco said.
The Peterson study, noting the political difficulty of completely removing the provision, recommended it be scaled back to the original House version and lawmakers add language exempting NAFTA partners Canada and Mexico and members of the WTO procurement pact, such as the European Union and Japan.
That would still restrict steel imports from countries that are not members of the government procurement agreement -- such as China, Russia, India and Brazil -- encouraging them to discriminate against U.S. exporters, the study said.
A coalition of 100 business groups and associations released a letter on Wednesday urging Senate leaders to eliminate the Buy American provisions, which they predicted would "backfire on the United States."
Representative Pete Visclosky, chairman of the Congressional Steel Caucus, said he remained confident the Buy American provisions would be part of the final stimulus bill.
"I have no belief that it will be taken out or weakened," the Indiana Democrat told reporters.
Many of the steel-state lawmakers argued it made sense that U.S. taxpayer-funded projects give preference to U.S. steel companies and other domestic manufacturers.
"That is going to pass easily and overwhelmingly, and it's going to stay part of the package because that's the right thing to do," said Michael Doyle, a Democrat congressman from Pennsylvania.
Senator Byron Dorgan Blasts Post: “Absolutely Absurd”
Byron Dorgan, a member of the Senate Democratic leadership, blasted the Washington Post editorial board as "absolutely absurd" Thursday for its objection to the 'Buy American' provision of the stimulus package.
"'Buy American' sounds patriotic, but paying more than necessary for steel diverts resources that could create jobs in other industries. Worse, it raises the prospect of retaliation against American exporters by U.S. trading partners," opined the Post.
"The Washington Post, as is their usual trademark, suggested this is protectionist," said North Dakota's Dorgan. "We're a country with a 700 billion dollar trade deficit. It's absurd for somebody to suggest we're protectionist. It's absolutely absurd. They must not have understood that we've got about a $2 billion dollar a day deficit in trade. That's hardly protectionist."
The Post warned that the provision -- which is strongly opposed by the Chamber of Commerce and other organizations that represent multinational corporations -- could start a trade war.
"The United States started one such trade war in 1930, when it enacted a tariff increase that prompted European retaliation -- thus helping turn a bad recession into the Great Depression. Better to learn from this history than to repeat it," offered the editors.
"You mean like the French wanting to make sure that their stimulus promotes jobs in France? Well, that's what the French are doing," responded Dorgan.
"On an emergency basis, since when has it become inappropriate for countries to care about whether what they're doing is creating jobs inside their country? I mean, that's a Byzantine proposition fostered by the editorial writers and a few multinational companies that don't necessarily have any interest in creating jobs here."
Dorgan predicted that the 'Buy American' provision, which requires companies to use American materials when possible, would remain in the stimulus bill.
