Domestic manufacturers voice concern at Senate Buy-American compromise; want to retain buy-American language
UNITED STATES BUSINESS AND INDUSTRY COUNCIL -- Manufacturing Business Technology, 2/5/2009 7:28:00 PM
The U.S. Business and Industry Council (USBIC) and its 1,850 member companies praised the Senate for rejecting a proposal to kill the Buy-American provisions contained in its stimulus bill. But the Council cautioned that further compromise will slash the benefits delivered by the bill to Americans, dilute its stimulus effect, and boost the gains channeled to foreigners.
The Senate last night voted down an ill-advised proposal from Arizona Republican John McCain to strip all Buy-American language from the stimulus bill. But it adopted a compromise that could greatly weaken the bill’s existing Buy-American measure by requiring that the measure “be applied in a manner consistent with United States obligations under international agreements.”
Observed Council President Kevin L. Kearns, “This legislative caveat sounds humdrum, but it goes to the heart of whether the stimulus package will be effective. All these ‘international agreements’ include the production- and job-destroying trade deals signed under the last two administrations. These shortsighted deals have helped addict our economy and consumers to foreign manufactured goods purchased courtesy of unsustainable foreign borrowing, thus helping to spark the current economic crisis to begin with.”
Kearns continued, “These outsourcing deals, which include NAFTA and the Uruguay Round world trade agreement, were pushed by multinational companies that wanted to send their vitally needed American factories and jobs to cheap foreign production sites. The outsourcers have increased their profit margins at the expense of boosting domestic output, employment, exports, and a higher standard of living for all Americans. And they were strongly supported by savvy foreign governments, which sought an easy way to generate economic growth – exporting to an increasingly indebted United States, often using unfair trading practices, while at the same time preventing America from responding effectively.”
Continued Kearns, “This trade strategy has hollowed out America’s productive sectors, and forced Washington to encourage the borrowing, importing, and consuming binge that is now collapsing into the worst economic crisis since the Great Depression.”
The Buy-American compromise, he said, “keeps firmly in place the trade-agreement chains strangling American sovereignty and undermining sound economic policymaking in Washington.”
Kearns called the Senate bill’s original Buy-American provision “the most important break yet with our political leaders’ thoughtless rush to promote recovery by simply throwing money at the economy and hoping for the best. As seen with last year’s stimulus checks, that approach only encourages the consumption of more foreign goods with more foreign money, builds our national mountain of debt higher, and worsens the crisis.”
“The compromise language,” he said, “moves the nation back toward that failed approach, and farther away from producing our way out of the crisis–the only possibility for restoring genuine economic health.”
The Council is the nation’s leading industry-wide domestic manufacturing organization. Founded in 1933, its member companies span a broad range of manufacturing sectors, including IT hardware makers, tool and die firms, industrial equipment producers, mold builders, metal casters and stampers, plastics and chemical companies, and auto parts producers.
