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Job Killing Buy American Provision Included in...Jobs Bill

From Kelsey Zahourek on Wednesday, December 16, 2009 3:00 PM
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Today, the House is set to vote on a “jobs” bill that includes a protectionist Buy American provision that would make it harder for government agencies to waive the requirement that steel and manufactured goods used for highway and bridge projects are American made.  This seeks to strengthen the previous Buy American provision that was included in the failed stimulus plan passed in February. 

“Buy American” mandates in this year’s $787 billion spending package have clearly not helped create the jobs that legislators have promised.  Unemployment hovers around 10%, yet populist sentiments are attempting to make the same mistake twice.  According to the New York Times, employers across the country have been forced to lay off workers as a direct result of “Buy American” requirements in the bill.  One factory in Pennsylvania has let go of 600 employees because some of its products include goods produced overseas.

“Buy American” mandates raise barriers to trade and endanger American businesses to retaliation from trading partners.  Considering the escalating trade wars with both China and Mexico, the last thing that Congress should do is provoke trading partners further.  If the federal government is serious about spurring the creation of new jobs, Congress should focus on lowering taxes and pursuing enactment of pending free trade agreements.

Click here to read ATR's letter opposing Buy American

Permalink | Email | Print | Tags: TRADE, CONGRESS

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Comments

The US is a trade deficit nation. That means international trade cost us more jobs than we gain form it. The only advantage to being a trade deficit nation is that if there is a trade war you win. A trade war or tariffs that would drive our trade deficit to zero would be the equivalent of having a stimulus package each and every year without having to borrow any money. The history of trade protection has been written by supporters of free trade. They never tell you that the US was the worlds most trade protected nation for more than a hundred years. During that more than a hundred years of trade protection the US ascended to the economic high from which it has descended during a short period of free trade.
>> n6532l Wednesday, December 16, 2009 5:30 PM

Everything n65321 wrote after "The US is a trade deficit nation" is factually wrong. International trade creates jobs because countries can maximize their competitive advantage by specializing in what they produce most efficiently. Not really sure how a net importing country would "win" a trade war. Tariffs would be the equivalent to a stimulus package only in that it would further damage the economy. I can't tell you how many text books I read in school that were written by free trade libertarians, because we all know that is the dominant view point in government-run schools. And the US was not protectionist for more than 100 years, there is a difference b/w not getting involved in other countries' wars, and in not trading with them.
>> TCH Thursday, December 17, 2009 10:18 AM

TCH, US trade protection began in 1828 when Andrew Jackson passed the “Tariff of Abomination” that was the highest tariffs we have ever had. Tariffs went up and down ending at about 20 percent just before the Civil War. After the Civil War started Congress passed the Morrill and War tariffs which jacked tariffs up to just under 50 percent. Tariffs stayed high until low tariffs were used to constrain monopolies. That was soon abandoned in favor of anti trust legislation. By the 1920s tariffs were back in the range of 40 percent where they were when Mr. Smoot and Mr. Hawley introduced their new tariffs that raised tariffs to just below 60 percent. That is the 750 char version of 100 years of trade protection. Check it out.
>> n6532l Thursday, December 17, 2009 7:25 PM

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