the raw story

US Chamber of Commerce pushes to end ‘Buy American’ rules

BY STEPHEN C. WEBSTER

Published: June 11, 2009

The United States Chamber of Commerce asked the U.S. Office of Management and Budget on Thursday to allow greater freedom in the spending of stimulus dollars.

Specifically, the Chamber, traditionally an advocate of big business and Republican economic policies, cautioned that requiring taxpayer dollars to be spent on American goods threatens the loss of billions of dollars.

“U.S. businesses and local governments are quickly waking up to the reality that Buy American restrictions are likely to cause them substantial harm, particularly if countries such as Canada retaliate with protectionism of their own, said Myron Brilliant, the chamber’s senior vice-president of international,” in a report by Canada’s Globe and Mail.

“We could be at risk for billions of dollars and we’re very concerned about those numbers,” Brilliant was quoted saying.

He added: “We’re sending warning signals now that if we don’t fix it the numbers could get very big. We would face potential retaliation from our friends in Canada, potentially from Europeans, and we want to avoid that.”

Already ‘watered-down’
The “Buy American” rules which landed in the stimulus were ultimately a “watered-down” version of the original proposal. In the Senate, the inclusion would have required all manufactured goods bought with stimulus funds to come from the U.S. However, after being cautioned by European Union and Canadian leaders, the Obama administration backed off Buy American.

President Obama said he did not wish to “send a signal that we’re not open for business.”

What passed essentially amounts to requiring stimulus expenditures to comply with U.S. trade agreements.

Foreign trading partners alone did not lead the charge against reinvestment in American manufacturing. Joining the U.S. Chamber of Commerce in opposition to Buy American are the American Business Conference, The Associated General Contractors of America, Associated Builders and Contractors, the Coalition of Service Industries, the National Defense Industry Association and the National Foreign Trade Council, among others.

“Under North American free-trade agreement rules, Canada is exempt from the Buy American restrictions on most larger federal projects,” noted The Globe and Mail. “But the bulk of the stimulus cash is actually spent by states and cities, which are not covered by NAFTA or World Trade Organization government purchasing rules.”

The Mail also quoted Auggie Tantillo, director of the American Manufacturing Trade Action Coalition, who contended that the pushback against Buy American rules “doesn’t pass the U.S. economic interest laugh test.”

“The U.S. Chamber in Washington should change its name to the ‘Chamber for Offshoring U.S. Jobs,’” he added.