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What Is The Purpose Of The Buy America Provisions In The Stimulus Plan?

In 1933, Congress enacted the Buy American Act:

. . . [O]nly such unmanufactured articles, materials, and supplies as have been mined or produced in the United States, and only such manufactured articles, materials, and supplies as have been manufactured in the United States substantially all from articles, materials, or supplies mined, produced, or manufactured, as the case may be, in the United States, shall be acquired for public use.

Despite the existence of this law, a Buy American provision was attached to the House stimulus plan. I neither understand the clamor for this provision nor the opposition to it. It seems superfluous to me. What am I missing?

Speaking for me only

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    It's a pain in the ass too (5.00 / 1) (#2)
    by jussumbody on Sat Jan 31, 2009 at 09:24:58 AM EST
    There are some very basic office supplies that just are not manufactured in the US anymore.  In my office we sometimes have to buy hole punchers, staplers, etc., out of our own pockets because we can't find US made ones.

    I think things like nails are extremely (none / 0) (#19)
    by inclusiveheart on Sat Jan 31, 2009 at 10:24:04 AM EST
    difficult to find made in the US now.  

    I hope they don't need any nails or screws for those infrastructure projects.

    I don't know how the provision is worded though.  Maybe there is an option to buy foreign-made products when they aren't available made in the US - but it might not.

    Parent

    The difference is (5.00 / 1) (#6)
    by Steve M on Sat Jan 31, 2009 at 09:41:18 AM EST
    this law seems to apply only to direct federal spending, while I think the new law would also apply to private recipients of stimulus funds.

    Yup (none / 0) (#10)
    by andgarden on Sat Jan 31, 2009 at 09:42:27 AM EST
    Also, it's probably good politics.

    Parent
    Also (none / 0) (#70)
    by cal1942 on Sat Jan 31, 2009 at 01:40:01 PM EST
    good economics.

    Parent
    No (none / 0) (#22)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:29:07 AM EST
    Buy American applies to all government procurement, which means every government contract.

    They can't use foreign goods or materials to service federal government projects.

    Believe it or not, I am a bit of an expert on the Buy _ laws, both federal and state.
     

    Parent

    There are four possible answers (none / 0) (#32)
    by inclusiveheart on Sat Jan 31, 2009 at 10:41:34 AM EST
    to your question:

    1. Politics as other have said.  But I'll say that most Americans are aware of how few things are made in the USA anymore - it is not the 70s anymore - so I think it is sort of dumb politics - or politics for the very ignorant...

    2. Nobody was observing the original law so they felt that they had to write another one.

    3. The new law is less restrictive than the old one.

    4. The people in Congress didn't know about the old law which sadly I think is more likely than most people would want to believe.  Over the years, I've had numerous troubling conversations with Hill staffers that should have known about existing laws.


    Parent
    Oh oh, re your #3 (none / 0) (#48)
    by Cream City on Sat Jan 31, 2009 at 11:28:02 AM EST
    Is the new clause truly redundant or really watering it down . . . as we have seen before with faux bills lobbied to and lobbed into our Congress by the corporates.

    Parent
    multiple choice (none / 0) (#57)
    by delandjim on Sat Jan 31, 2009 at 12:04:42 PM EST
    I vote for reason #4.
    I haven't heard anyone mention an existing law until now. That's very interesting, as they say.

    Parent
    I knew there was one, but thought (none / 0) (#76)
    by inclusiveheart on Sat Jan 31, 2009 at 02:12:28 PM EST
    maybe I'd missed it being nullified somewhere along the way when I heard about this new provision in the stimulus package.

    Parent
    We Canadians (none / 0) (#79)
    by Natal on Sat Jan 31, 2009 at 02:43:25 PM EST
    are a bit miffed about this isolationist policy.  We are your largest trading partner. It can be played two ways you know.  Stephen Harper is going to raise this as a topic of discussion when Obama visits Canada February 19th. It should be interesting what Obama has to say after the visit.

    Parent
    Call me an evil protectionist, (5.00 / 3) (#18)
    by Radiowalla on Sat Jan 31, 2009 at 10:21:15 AM EST
    but I try to buy American when I can, especially now.   I'd rather buy, say, greeting cards that are printed in the US instead of cards from China.
    I just bought the only blankets I could find in the Company Store catalog that are made in the US.  

    American workers need work so why not try to help out?  It doesn't take that much effort and it isn't always doable, but I feel it's important to try.

    To me, it's no different from buying my books at my local, independent bookstore or shopping for local produce.

    Interesting (none / 0) (#27)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:34:37 AM EST
    But not responsive to my post.

    Does anyone have any idea why this was added, considering there is already a law, now 66 years old, that already provides what this provision is stating to do?

    Parent

    I think it is supposed to feed our (none / 0) (#41)
    by Militarytracy on Sat Jan 31, 2009 at 11:07:58 AM EST
    identity or something, inspire us somehow.  Seems silly though to me because as anyone can witness transpiring within our global economy, we are all a whole lot more economically interconnected these days than we imagined.  Making good foreign investments is also good for America I would think if you are bringing your earnings home with you?

    Parent
    perhaps because it's been ignored (none / 0) (#44)
    by Dadler on Sat Jan 31, 2009 at 11:16:35 AM EST
    i don't know, i'm just guessing.  the gov't following the law doesn't have an exactly pristine record.

    Parent
    No, I don't know why it was added (none / 0) (#45)
    by Radiowalla on Sat Jan 31, 2009 at 11:24:24 AM EST
    but maybe restating the principle is intended to build confidence among American workers.  

    Parent
    I'd suspect there may have been (none / 0) (#73)
    by scribe on Sat Jan 31, 2009 at 02:05:35 PM EST
    court decisions or treaties in the interim which imposed some limits on the "pure" Buy American provisions of the old law.

    I recall a case that went to the Supreme Court within the last 20 years in which a state (Mass., I believe) had passed a Buy American law and the law was struck down on preemption grounds.

    I would not be surprised if this new provision runs headlong into either NAFTA, WTO rules, or both, with unsatisfactory results.

    Parent

    here, here! (none / 0) (#88)
    by suzieg on Sun Feb 01, 2009 at 04:42:39 AM EST
    not superfuous, dangerous (5.00 / 1) (#36)
    by jedimom on Sat Jan 31, 2009 at 10:50:01 AM EST
    it is Smoot-Hawley raising its ugly head, it is counterproductive and will lead to a trade war, it is a stupid stupid provision and needs to be stripped out

    EU steelmakers ALREADY are demanding the EU limit their stimulus to their companies in retaliation and China is pixxed,

    since they are buying all the debt we are issuing, that seems idiotic, AND companies like CAT would like to do work in China on THEIR huge stimulus too...

    global trade DIED after Smoot Hawley and helped the Depression get Great...the DEMS that put this in must have missed that economics/history lesson

    post on this provision and the China currency talk here

    and yes (none / 0) (#38)
    by jedimom on Sat Jan 31, 2009 at 10:52:03 AM EST
    this applies to ALL the stimulus money to ALL private companies....

    Parent
    Most of our major trading partners are MUCH more (5.00 / 2) (#39)
    by esmense on Sat Jan 31, 2009 at 10:59:26 AM EST
    protectionist than we are. Will they "retaliate?" Perhaps. Any excuse to be protectionist themselves, I guess. But I, personally, wouldn't worry about it too much -- because I doubt our trade imbalance can really get much worse. American businesses are not playing and have never played on a level playing field when it comes to "free" trade. They are and have long been at a disadvantage because we are much less protectionist than our trading partners.

    Perhaps its possible that if we stop offering the world an entirely free ride, some of our trading partners may begin to think a little more reciprocity is in order. Certainly our own all out commitment to "free" trade has done extremely little to encourage such reciprocity to date.

    (Frankly, I doubt that this mild attempt at "protectionism" on our part will be of enough significance to affect things either way -- in terms of inspiring significant retaliation or  greater reciprocity. Other countries' protectionist policies are, for the most part, based in internal political realities that have never been and are unlikely to be affected by our actions.)

    I speak as someone who has long been in the business of marketing for sectors as diverse as high tech, agriculture, aerospace, timber, automotive parts, etc., in the most trade dependent state in the union; Washington.

    so far we have upset the following trading partner (none / 0) (#69)
    by jedimom on Sat Jan 31, 2009 at 01:29:47 PM EST
    canada:
    Canada's government said Thursday it is concerned about US protectionism in its economic stimulus, pointing to a 'Buy American' provision for iron and steel purchases. 'We want to avoid protectionism in this economic slowdown,' said Prime Minister Stephen Harper....

    Thursday, Mr. Harper added Canada's name to the growing list of U.S. trade partners, from the European Union to Australia, who are seeking to overturn the provision.

    "This is obviously a serious matter and a serious concern to us," Mr. Harper told the House of Commons, adding that he had spoken about the matter with Canada's ambassador to the U.S., Michael Wilson.

    "I know that countries around the world are expressing grave concern about some of these measures, that go against not just the obligations of the United States, but frankly, the spirit of our G20 discussions," the prime minister added.

    "We will be having these discussions with our friends in the United States, and we expect the United States to respect its international obligations."

    front page in Canadian Papers, the talk of the Davos Forum, the EU revolting over it already...and it EXPANDS the other law...

    Parent

    Canada's small population doesn't provide (5.00 / 1) (#71)
    by esmense on Sat Jan 31, 2009 at 01:49:32 PM EST
    much of a market for its producers. Although it, along other countries around the world, may not be ready to come to terms with the hard new realities presented by the collapse of the American consumer, we have to start encouraging them to do so. It is Canada and the world's best long term interest to see the revival of the American consumer market -- something that can't happen without some revival of America's productive capacity.

    Parent
    Canada is (none / 0) (#81)
    by Natal on Sat Jan 31, 2009 at 02:52:34 PM EST
    in recession now. By curtailing trade with your largest trading partner could have damaging economic consequences also.

    Parent
    This is a pet issue ... (5.00 / 3) (#42)
    by Robot Porter on Sat Jan 31, 2009 at 11:11:48 AM EST
    of Rep. Visclosky, and is seen as both a pro-labor, pro "fair trade," pro-steel provision. Visclosky is chairman of the Congressional Steel Caucus.

    Visclosky openly opposed the bailout, and it's my understanding that he was wavering on the stimulus.

    The adoption of this provision was likely a means of getting him, and both the labor and steel interests that support him, on board.

    I could be wrong.  But that's my read.
     

    Now it makes sense (5.00 / 3) (#43)
    by Militarytracy on Sat Jan 31, 2009 at 11:12:46 AM EST
    Did you say... (none / 0) (#65)
    by lentinel on Sat Jan 31, 2009 at 12:43:50 PM EST
    there is a "Congressional Steel Caucus"?

    I had never heard of this.
    To me this is truly hilarious.

    Can any old industry have its' own caucus?

    I want a Congressional Musicians' Caucus.
    No more canned music at political conventions.


    Parent

    Yup, there is ... (5.00 / 1) (#67)
    by Robot Porter on Sat Jan 31, 2009 at 01:15:11 PM EST
    a Congressional Steel Congress.

    And beware of what you ask for.  A "Congressional Musician's Caucus" is currently being formed, Rep. Joe Crowley will be one of the chairs.

    Parent

    This administration is extremely sensitive to the (5.00 / 3) (#68)
    by esmense on Sat Jan 31, 2009 at 01:15:50 PM EST
    messages it is sending to the broader world, as well as the domestic audience. So while of course this provision is politically motivated, I doubt it was included without some thought to how it would be perceived beyond our borders.

    Now, while I have no illusions that these measures will do anything substantial, the symbolism may be important. And that is most likely why they were included.

    Let's be clear eyed about the state our trade policies have brought us to, along with the rest of the world; a state in which much of the world was depending for its prosperity on our vast consumer market -- a market being supported increasingly not by strong productive strength and growth in consumer incomes or even substantial technological advancement (where the rest of the world has been catching up and in many areas surpassing us) -- but by very little more than unsustainable, questionable easy credit. When we reached the place where almost the only opportunities left for wealth creation for the average American was speculating with their homes, we were truly at the end of the line in terms of the benefits being realized from the policies we've been pursuing.

    Rather than raise the banal cry of "protectionism" and the usual cynical dismissals of the concerns of American workers and key industries as no more than "politics" or "pandering" to "special interests," perhaps it is time to reconsider our trade policies and try to identify where we went wrong.

    Is it likely the only reaction of the rest of the world, dependent as it has been and is on the American consumer, to any attempt to rebuild our productive capacity and increase and protect the earning power of those consumers, will be "retaliation?"  Or is it possible that some indication of an attempt to put a floor under our downward spiral, and re-build our prosperity, will be welcome by many (if, of course, not all)? After all, our competitors and trading partners for the most part have never thought it was good policy to abandon their own workers and key industries.

    Superb (none / 0) (#78)
    by cal1942 on Sat Jan 31, 2009 at 02:36:36 PM EST
    The most informed, intelligent comment on this thread.

    Concerning one small part of your comment:

    technological advancement (where the rest of the world has been catching up and in many areas surpassing us)

    "Catching up" was inevitable.  "Surpassing us" is directly related in no small way to our diminished manufacturing base and the abandonment of whole industries.

    The unfortunate knee-jerk reactions opposing any hint of "protectionism" or expansion of manufacturing activity are coming from people who just aren't thinking things through or are allowing other predudices to influenece their thinking.

    Many thanks.

     

    Parent

    I absolutely agree (5.00 / 2) (#83)
    by esmense on Sat Jan 31, 2009 at 03:30:35 PM EST
    ""Surpassing us" is directly related in no small way to our diminished manufacturing base and the abandonment of whole industries."

    When Seattle's economy collapsed with the collapse of the aerospace industry in the late '60s it was left with only one really significant thing in its favor; despite defections, it was still a city of engineers and skilled craftsmen. That talent, coupled with huge infusions of "pork" dispersed in the mid to late 70s through the Department of Commerce for investment in high tech development and modernizing our port and related transportation systems, was an absolute requirement for the entreprenuerial explosion -- in much more than just high tech and trade -- the city and the region experienced in the 1980s and 90s.  

    As a nation, we can't afford to allow such talent and skills to wither.


    Parent

    I'm Totally Out of My Depth On This Topic (5.00 / 2) (#77)
    by daring grace on Sat Jan 31, 2009 at 02:27:30 PM EST
    so I'm not even sure if this piece from a web site called Public Citizen which seems to be making distinctions between the current proposal and previous legislation in the Buy America plan of 1982 and the Buy American plan in 1933 is helpful to this discussion or not.

    But here it is.

    Off topic comments (1.00 / 1) (#21)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:27:15 AM EST
    will be deleted.

    The subject of your post (none / 0) (#80)
    by cal1942 on Sat Jan 31, 2009 at 02:49:16 PM EST
    was bound to trigger a trade discussion.

    Parent
    Wasn;t a trade discussion (none / 0) (#85)
    by Big Tent Democrat on Sat Jan 31, 2009 at 08:27:10 PM EST
    Honestly, considering the quality of our (none / 0) (#1)
    by tigercourse on Sat Jan 31, 2009 at 09:14:11 AM EST
    law makers, they probablly forgot that law existed.

    That, or for showmanship.

    What your missing (none / 0) (#3)
    by SOS on Sat Jan 31, 2009 at 09:33:16 AM EST
    is standing at the unemployment line or standing on a street corner with a cup out because your job was cut because foreign materials and products are "cheaper".

    What you miss (none / 0) (#25)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:31:05 AM EST
    is the point of my post - the Buy American Act is already in place.

    This new provision is redundant.

    Parent

    You don't? (none / 0) (#4)
    by andgarden on Sat Jan 31, 2009 at 09:33:37 AM EST
    The reason for it is obviously some version of "don't give the evil foreigners, with their cheap labor, our tax money." It's protectionism.  

    Oh come on how is (5.00 / 1) (#5)
    by SOS on Sat Jan 31, 2009 at 09:38:18 AM EST
    revitalizing and energizing American production and buying our own resources "protectionism"?

    Parent
    Um (none / 0) (#8)
    by andgarden on Sat Jan 31, 2009 at 09:41:35 AM EST
    pro·tec·tion·ism       (prə-těk'shə-nĭz'əm)  Pronunciation Key  
    n.   The advocacy, system, or theory of protecting domestic producers by impeding or limiting, as by tariffs or quotas, the importation of foreign goods and services.

    Seems pretty straightforward to me.

    Parent

    Nothing much (5.00 / 1) (#72)
    by cal1942 on Sat Jan 31, 2009 at 01:56:18 PM EST
    wrong with protectionism.

    Have you heard it's a dirty word and react accordingly? Sure sounds like it.

    I'm wondering if this provison is actually the same as the previous act.

    If it is then perhaps it's a reiteration to encourage American manufacturing. If a given manufacturer offshored it's operations it could be a message to straighten up or miss the boat, a piece of the billions.

    Real recovery of the economy requires diminishing the influence of the finance industry and starting to actually make stuff again.

    Parent

    does anyone know if it matters (none / 0) (#89)
    by of1000Kings on Sun Feb 01, 2009 at 06:00:21 AM EST
    whether the company just has to be american, or whether the products actually have to be produced in America...

    I mean, what if Ford was going to make a truck or something for government use or something related to the stimulus...would it matter if they received parts of the vehicle from one of their oversee factories and used them, or would it matter if a portion of the production happened in Mexico...

    I mean, just because you buy a ford doesn't mean you're buying a 100% american product...

    Parent

    50% US Made Rule (none / 0) (#90)
    by squeaky on Sun Feb 01, 2009 at 12:36:22 PM EST
    Feingold was trying to up it to a 75% rule in 93.

    Parent
    Never mind (none / 0) (#12)
    by SOS on Sat Jan 31, 2009 at 09:43:35 AM EST
    If people can't think outside the box so be it.

    Parent
    There is a middle ground (none / 0) (#28)
    by inclusiveheart on Sat Jan 31, 2009 at 10:35:04 AM EST
    between the two of you.  Tariffs are not all bad at all.  Protecting our standard of living is not bad either.  I heard a discussion of tariffs on the radio a couple of years ago in the context of a greater discussion about the influx of Chinese made products.  The "expert" whose name I don't recall was talking about the Clinton Administration's import tax structure and how it - according to this expert - allowed choice in our market, but also took into account the differences between our economy and the economy where the items were made and brought the products somewhat on a par after tariffs were levied.  It was not so oppressive that the foreign-made products were more expensive and it was designed that way.  Meanwhile, by levying the tax on these goods the government was able to make up something on lost taxes on domestic production which isn't bad either imo.

    Honestly, if I can't go and buy $100,000 worth of goods overseas without declaring them and paying duty when I come back into the country, I don't see why Walmart should be able to.

    Parent

    My query is not even about trade policy (none / 0) (#30)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:36:16 AM EST
    It is why all this fuss over a superfluous and redundant provision whose substance has been American law for 66 years?

    Parent
    I responded below with my (none / 0) (#33)
    by inclusiveheart on Sat Jan 31, 2009 at 10:44:23 AM EST
    four possible answers.  I am partial to number four myself after watching this Congress over a few terms now.

    Parent
    And if the BAA is the issue (5.00 / 1) (#34)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:47:09 AM EST
    Then dare I say that an amendment to the Buy American Act should be proposed. In 2003, Russ Feingold did just that:

    The legislation that I introduce today, the Buy American Improvement Act, would strengthen the existing Act by tightening existing waivers and would require that information be provided to Congress and to the American people about how often the provisions of this Act are waived by Federal departments and agencies.

    As I noted earlier, there are currently five primary waivers in the Buy American Act. The first allows an agency head to waive the Act's provisions if a determination is made that complying with the Act would be ``inconsistent with the public interest.'' I am concerned that this waiver, which includes no definition for what is ``inconsistent with the public interest'' is actually a gaping loophole that gives broad discretion to department secretaries and agency heads. My bill would clarify this so-called ``public interest'' waiver provision to prohibit it from being invoked by an agency or department head after a request for procurement (RFP) has been published in the Federal Register. Once the bidding process has begun, the Federal Government should not be able to pull an RFP by saying that it is in the ``public interest'' to do so. This determination, sometimes referred to as the Buy American Act's national security waiver, should be made well in advance of placing a procurement up for bid.

    The Buy American Act may also be waived if the head of the agency determines that the cost of the lowest-priced domestic product is ``unreasonable,'' and a system of price differentials is used to assist in making this determination. My bill would amend this waiver to require that preference be given to the American company if that company's bid is substantially similar to the lowest foreign bid or if the American company is the only domestic source for the item to be procured.

    I have a long record of supporting efforts to help taxpayers get the most bang for their buck and of opposing wasteful Federal spending. I don't think anyone can argue that supporting American jobs is ``wasteful.'' We owe it to American manufacturers and their employees to make sure they get a fair shake. I would not support awarding a contract to an American company that is price gouging, but we should make every effort to ensure that domestic sources for goods needed by the Federal Government do not dry up because American companies have been slightly underbid by foreign competitors.

    The Buy American Act also includes a waiver for goods bought by the Federal Government that will be used outside of the United States. There is no question that there will be occasions when the Federal Government will need to procure items quickly that will be used outside the United States, such as in a time of war. However, items that are bought on a regular basis and are used at foreign military bases or United States embassies, for example, could reasonably be procured from domestic sources and shipped to the location where they will be used. My bill would require an analysis of the difference in cost for obtaining articles, materials, or supplies that are used on a regular basis outside the United States, or that are not needed on an immediate basis, from an American company, including the cost of shipping, and a foreign company before issuing a waiver and awarding the contract to a foreign company.

    The fourth waiver allowed under the Buy American Act states that the domestic source requirements of the Act may be waived if the articles to be procured are not available from domestic sources ``in sufficient and reasonably available commercial quantities and of a satisfactory quality.'' My bill would require that an agency or department head, prior to issuing such as waiver, conduct a study that determines that domestic production cannot be initiated to meet the procurement needs and that a comparable article, material, or supply is not available from an American company.

    The newest Buy American Act waiver, which was enacted in 1994, exempts purchases of less than $2,500 from the domestic source requirements of the Act. While this waiver is not addressed in my bill, I have requested that the General Accounting Office conduct a study of this so-called ``micro purchase'' exemption, including how often it is used and its impact on American businesses.

    My bill also strengthens the Buy American Act in four other ways.

    First, it expands annual reporting requirements regarding the use of waivers that currently apply only to the Department of Defense to include all Federal departments and agencies. My bill specifies that these reports should include an itemized list of waivers, including the items procured, their dollar value, and their source. In addition, these reports would have to be made available on the Internet.

    The bill also increases the minimum American-made content standard for qualification under the Act from the current 50 percent to 75 percent. The definition of what qualifies as an American-made product has been a source of much debate. To me, it seems clear that American-made means manufactured in this country. This classification is a source of pride for manufacturing workers around our country. The current 50 percent standard should be raised to a 75 percent minimum.

    My bill also addresses the crucial issue of dual-use technologies and efforts to prevent them from falling into the hands of terrorists or countries of concern. My bill would prohibit the awarding of a contract or sub-contract to a foreign company to manufacture goods containing any item that is classified as a dual-use item on the Commerce Control List unless approval for such a contract has been obtained through the Export Administration Act process.

    Finally, my bill would require the General Accounting Office to report to Congress with recommendations for defining the terms ``inconsistent with the public interest'' and ``unreasonable cost'' for purposes of invoking the corresponding waivers in the Act. I am concerned that both of these terms lack definitions, and that they can be very broadly interpreted by agency or department heads. GAO would be required to make recommendations for statutory definitions of both of these terms, as well as on establishing a consistent waiver process that can be used by all Federal agencies.

    I am pleased that this legislation is supported by a broad array of business and labor groups including: Save American Manufacturing, the U.S. Business and Industry Council, the International Association of Machinists and Aerospace Workers, the Milwaukee Valve Company, and the National and Wisconsin AFL-CIO.

    If that is what this is about, then let's talk about it directly and forthrightly, and dare I say it, more effectively.

    If the BAA is the issue, then addressing it FOR ALL federal government procurement would be the better course.

    Parent

    Good point. (none / 0) (#40)
    by inclusiveheart on Sat Jan 31, 2009 at 11:05:28 AM EST
    Still in the House I am still leaning towards number four.

    But I am more inclined to think that moderate tariffs are a better way to go than this buy American thing.  Having dealth with government procurement which is arduous enough as it is, I can't imagine combing through each item procured and making sure that each and every stapler was made in the US.  I am even less enchanted by the notion that embassies and military bases would be shipping American products all over god's green earth (which is turning brown in part because people aren't buying locally) just to meet procurement requirements - that seems wasteful to me when you aren't talking about standard military equipment.  In addition, like all bases even in the US the local economies do benefit economically as a result of hosting our military.  I think there is a diplomatic element to this equation that is an important consideration as many of the countries in which we have military bases are not overly happy about our presence on their soil.  No reason to further reduce our importance to the people in those countries by refusing to engage in trade with them locally.

    Parent

    ugh (none / 0) (#84)
    by boredmpa on Sat Jan 31, 2009 at 03:49:24 PM EST
    A blanket exemption for anything under 2500?  I find that hard to believe that was in the spirit of the original law and without solid accounting would have led to all sorts of administrative workarounds.

    Parent
    It is difficult (none / 0) (#54)
    by call me Ishmael on Sat Jan 31, 2009 at 11:48:53 AM EST
    to be sure since I don't have a link to the actual law but the link you provided suggests that this clause is meant to direct the purchasing by companies that receive federal stimulus.  The 1933 act bound governmental agencies in purchasing for "public use."  This would seem to apply to the companies not just the government.

    Parent
    It doesn't seem straightforward to me at all. (none / 0) (#86)
    by Dead Kennedy on Sun Feb 01, 2009 at 01:04:46 AM EST
    The Buy American provision is neither a tariff or a quota, and in no way impedes or limits the importation or sale of foreign goods.

    It simply requires the US government to buy American.  That has no direct effect on foreign producers ability to sell to private firms in the US.  At best it may help US steel interests keep their prices low, but that's not the same as protectionism.

    I'm sure Canada, Germany and other complainers have identical policies regarding public construction projects.  They can't seriously expect us to send our bailout money overseas.  That would be akin to asking us to shoot ourselves in the feet for their own sick amusement.

    Parent

    Of course it's protectionism. . . (none / 0) (#17)
    by LarryInNYC on Sat Jan 31, 2009 at 10:13:54 AM EST
    you're dispute is over whether protectionism is desirable or not.

    Parent
    My query is why redundant protectionism? (none / 0) (#24)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:30:25 AM EST
    this new provision does nothing that the buy American Act doesn't already do.

    Parent
    Why? To quote yourself (5.00 / 2) (#46)
    by Cream City on Sat Jan 31, 2009 at 11:26:14 AM EST
    . . . pols will be pols.  It's a political ploy.  That's all.

    Parent
    I don't know. . . (none / 0) (#35)
    by LarryInNYC on Sat Jan 31, 2009 at 10:48:14 AM EST
    and, not being familiar with the laws in question, I can't say whether this new one adds anything.

    The simplest possibility is often the best, and it's true that protectionism sells -- in this economic climate, finding anything that sells is no small accomplishment.

    Parent

    It's existing protectionism (none / 0) (#23)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:29:39 AM EST
    The new protectionism is superfluous.

    Parent
    Ok, then it's just politics (none / 0) (#26)
    by andgarden on Sat Jan 31, 2009 at 10:32:27 AM EST
    The Republicans are always offering silly amendments about making sure that whatever bill is under discussion offers absolutely no benefit to people not in the country legally, even when nobody thinks that's an issue.

    Parent
    Fair enough (none / 0) (#29)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:35:17 AM EST
    then why the hell does Caterpillar care?

    Parent
    Dunno (none / 0) (#31)
    by andgarden on Sat Jan 31, 2009 at 10:38:19 AM EST
    Maybe their lawyers suck. Or maybe they just want to piss off David Sirota.

    Parent
    wto, free trade (none / 0) (#7)
    by Joe the carpenter on Sat Jan 31, 2009 at 09:41:23 AM EST
    do you think other countries will put up all kinds of legal questions in regard to this play by the lawmakers?

    They don't have any choice (none / 0) (#13)
    by SOS on Sat Jan 31, 2009 at 09:48:51 AM EST
    LOL it's true.

    We go down they go down with us.

    Parent

    already have (none / 0) (#37)
    by jedimom on Sat Jan 31, 2009 at 10:51:15 AM EST
    a Canadian Parliamentarian already showed up at Congress last week about this demanding it be removed...

    this violates WTO and our trade agreements as well

    Parent

    Strictly PR (none / 0) (#14)
    by mmc9431 on Sat Jan 31, 2009 at 09:50:40 AM EST
    It's a feeble attempt by Democrat's to out wave the Republican's with the flag and patriotism. First it was "God" and now we're going into the "country" faze.

    Re the "god" part of the O plan (5.00 / 2) (#50)
    by Cream City on Sat Jan 31, 2009 at 11:29:59 AM EST
    it's not over but just beginning -- he made his nomination this week for the head of the "faith-based office" and again promised that it will be ramped up from what it was under Bush.  

    That went under the radar, with much else this week.

    Parent

    Well (none / 0) (#15)
    by SOS on Sat Jan 31, 2009 at 09:55:39 AM EST
    I suppose we can just continue our race to the bottom.

    I think I'll pass on that one.

    Doesn't (none / 0) (#16)
    by CoralGables on Sat Jan 31, 2009 at 09:55:57 AM EST
    the original buy American act deal with the federal government purchasing items? Stimulus dollars will be distributed to private corporations who can purchase materials anywhere they would like such as Chinese steel to rebuild a Pittsburgh bridge if the buy American provision isn't attached.

    As for the backlash, a few corporations that do large amounts of business overseas fear a backlash of refusing to use US companies.


    Nope (none / 0) (#20)
    by Big Tent Democrat on Sat Jan 31, 2009 at 10:26:26 AM EST
    That would still be subject to Buy American provisions.

    Parent
    I don't know but maybe this helps (none / 0) (#47)
    by Saul on Sat Jan 31, 2009 at 11:27:39 AM EST
    The Buy American Act (BAA - 41 U.S.C. § 10a-10d) was passed in 1933 by the U.S Congress, which required the United States government to prefer U.S.-made products in its purchases. Other pieces of Federal legislation extend similar requirement to third-party purchases that utilize Federal funds, such as highway and transit programs.

    In certain government procurements, the requirement purchase may be waived if purchasing the material domestically would burden the government with an unreasonable cost (the price differential between the domestic product and an identical foreign-sourced product exceeds a certain percentage of the price offered by the foreign supplier), if the product is not available domestically in sufficient quantity or quality, or if doing so is in the public interest.

    The President has the authority to waive the Buy American Act within the terms of a reciprocal agreement or otherwise in response to the provision of reciprocal treatment to U.S. producers. Under the 1979 General Agreement on Tariffs and Trade (GATT) Government Procurement Code, the U.S.-Israel Free Trade Agreement, the U.S.-Canada Free Trade Agreement, and the World Trade Organization (WTO) 1996 Agreement on Government Procurement (GPA), the United States provides access to the government procurement of certain U.S. agencies for goods from the other parties to those agreements. However, the Buy American Act was excluded from the GPA's coverage.

    That's a rehetorical question, right? (none / 0) (#49)
    by rdandrea on Sat Jan 31, 2009 at 11:28:45 AM EST
    It's in there for show.

    Arrgh (none / 0) (#51)
    by rdandrea on Sat Jan 31, 2009 at 11:30:46 AM EST
    r-h-e-t-o-r-i-c-a-l.

    Don't know where the extra "e" came from.
    Wait, yes I do.  I'm on my laptop and my fat fingers pressed both keys.

    Parent

    Maybe it's the stimulus for lawyers (none / 0) (#52)
    by Cream City on Sat Jan 31, 2009 at 11:32:50 AM EST
    as more will have to be hired by companies to (1) abide by or (2) find end-arounds to this provision, if it actually also gains in enforcement?  And then even more will have to be hired (1) by the feds to find evildoers and (2) by the companies to defend themselves against charges of evildoing with stimulus funds.

    Hey, why should lawyers be left out of the stimulus?

    Trust me (5.00 / 1) (#59)
    by Steve M on Sat Jan 31, 2009 at 12:21:30 PM EST
    Pass any law you like.  Lawyers will not be left out!

    Parent
    Ha. "Trust me" (none / 0) (#82)
    by Cream City on Sat Jan 31, 2009 at 03:01:24 PM EST
    must be taught in Law School 101.  I hear it from the lawyers on tv.  Or is Advertising Your Law Firm an advanced, upper-level course? :-)

    Parent
    Putting a ban on China (none / 0) (#55)
    by SOS on Sat Jan 31, 2009 at 11:49:00 AM EST
    importing American flags to the United States might not sit too favorably with the Chinese.


    A sense of belonging. (none / 0) (#63)
    by lentinel on Sat Jan 31, 2009 at 12:38:51 PM EST
    From what I have read, the Chinese essentially own us.
    I really, really, really would not like to unnecessarily antagonize them.

    Parent
    Flag waving and Keynes (none / 0) (#56)
    by DaleA on Sat Jan 31, 2009 at 11:58:11 AM EST
    Suspect that there is a flag waving component here. On the other hand, one criticism of the stimulus is that it will set off inflation, ie reduce the value of dollars since it it creating so many new ones. In Keynseyian terms this is not necessarily true domestically. As long as there are under used and idle domestic resources, an influx of dollars does not create inflation, theoretically. Spending the new dollars internationally would more likely spark a decline in the value of the dollar. This looks like a Keynesian hedge.

    Or (none / 0) (#58)
    by SOS on Sat Jan 31, 2009 at 12:19:56 PM EST
    the possibility or those select individuals who, privy to the knowledge that this is exactly what the fed intended, are prepositioned massively short.

    Parent
    WSWS: The rising tide of economic nationalism (none / 0) (#60)
    by Andreas on Sat Jan 31, 2009 at 12:24:54 PM EST
    As the global economic crisis continues to deepen, the unmistakable stench of economic nationalism is on the rise around the world. Confronted with collapsing industries and growing anger over job losses, governments are reaching for protectionist measures despite the disastrous consequences of such beggar-thy-neighbour policies in the 1930s.

    ...

    The Democrats in the House of Representatives went one step further by including a "Buy American" provision in Obama's $825 billion stimulus package approved on Wednesday. The clause, which requires infrastructure projects funded by the package to use only US-made iron and steel, has provoked protests from European steelmakers. Democrat senator Byron Dorgan is proposing a broader measure to exclude most foreign-made manufactured goods when the package reaches the Senate.

    Such measures threaten to provoke escalating retaliation and a full-blown trade war. A comment in the US journal Foreign Policy warned that the "explicitly protectionist language" contained in the package would "certainly be taken as a bad sign by the rest of the world. The world can deal with a protectionist India or Indonesia. The trading system will have much more trouble if the United States starts to renege on its traditional leadership role."

    ...

    In 1930, many foresaw the disastrous consequences of the Smoot-Hawley tariff act, which increased nearly 900 American import duties. Some 1,028 US economists signed a petition pleading with US President Herbert Hoover not to sign the bill into law. The Economist magazine recently cited the comments of Thomas Lamont, a partner of J.P. Morgan, who recalled: "I almost went down on my knees to beg Herbert Hoover to veto the asinine Hawley Smoot Tariff. That act intensified nationalism all over the world." Nevertheless, Hoover signed the law, provoking an avalanche of retaliation, the collapse of world trade and the formation of antagonistic currency blocs that set the course for the Second World War.

    The rising tide of economic nationalism
    30 January 2009

    So (none / 0) (#61)
    by SOS on Sat Jan 31, 2009 at 12:34:27 PM EST
    "requires infrastructure projects funded by the package to use only US-made iron and steel"

    We've been listening to all these developing countries bravado these past years about "how they don't need the United States and are capable of doing just fine on their own thank you."

    Now their whining to big daddy USA because big daddy is saying "your going to have to start paying your share."

    Parent

    In my vho (none / 0) (#62)
    by lentinel on Sat Jan 31, 2009 at 12:36:22 PM EST
    this is the legislative equivalent of the flag pin.

    Hows this (5.00 / 1) (#64)
    by SOS on Sat Jan 31, 2009 at 12:42:52 PM EST
    Country going to make it if we don't even give a sh*t about it?

    If we are that far gone to where "Buy American" makes Americans cringe to the point of being repulsed by the idea Obama should just come right out and say "look if you don't give a sh*t about America fine your on your own then good luck with whatever it is your trying to do and don't call us we'll call you."

    Parent

    I'm for (none / 0) (#66)
    by lentinel on Sat Jan 31, 2009 at 12:56:07 PM EST
    buying American, but I don't like it to be legislated.

    I believe that BTD's point was that this legislation is superfluous. That's why I likened it to the flag pin - which I also think is superfluous.

    I like buying American stuff if I can identify with the product and the quality of the product.

    I like to buy American crafts, for example.

    I think that "buying American" as a means of expressing that
    we "give a sh-t"  about our own country should be coupled with the pride of feeling that we are purchasing a great product - made  by people who are receiving fair wages and working under good conditions.  

    American business ethics don't look too good to me right now.
    And the ownership of many "American" companies is kind of hard to determine sometimes.


    Parent

    It does seem redundant. (none / 0) (#87)
    by Dead Kennedy on Sun Feb 01, 2009 at 01:08:24 AM EST
    I suspect the stimulus bill included the provision to spark discussion of its merits, and to give Democrats a talking point.

    I also suspect that most Democrats are like me, and weren't around in 1933 and don't know about the 1933 law.  It may have been restated just to restate it, or perhaps it's been compromised since 1933 by other bills?