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Huh? Buying American Could Cost US Jobs!

Part of the stimulus bill could create between 1,000 and 9,000 new jobs . . . at the price of 65,000 existing ones! With the hope of creating jobs, the "Buy American" provision of the bill mandates that only US-made iron and steel be used in public works projects, but it could have unintended consequences.

Other countries would likely react to the provision by prohibiting the use of US products in their public works, resulting in the residual American job loss. The US does about $104 billion in export business for other countries' public works projects. Hoping to change the Senate's mind, the EU has issued a warning that the bill might violate a WTO treaty signed by the US, the EU, and Japan.

While the figures are startling, the Alliance for American Manufacturing says they're not accurate. That group generously estimates that 77,000 jobs will be created if only domestic steel can be used, thus making it a net gain in US jobs. In response, President Obama said last night that he would try to water down the provision.

Should the US go ahead and exclusively support US steel companies through its public works projects, despite the possibility of retaliation by other countries?


stephley stephley 8 years
According to the Wall Street Journal, the provision helps ensure the green revolution won't be outsourced: "Congress is beginning to fear that the Obama administration's push for renewable energy will produce more jobs in Asia and Europe -- where most wind turbines and solar panels are made -- than in the U.S. The proposed remedy is a provision in the economic-stimulus bill that offers tax breaks to U.S. producers of the equipment. Sen. Jeff Bingaman (D., N.M.), chairman of the Energy and Natural Resources Committee, is urging support for a provision in the Senate version giving a 30% tax credit to companies that expand or build U.S. manufacturing facilities geared to renewable energy, clean transportation or electric-system upgrades. "Several of us have come to recognize that we've outsourced the very things we're going to need to change the nation's energy mix, and this is a way of encouraging more manufacturing here at home," Mr. Bingaman said. The situation highlights a weak link in U.S. industrial policy: Although tax credits are offered to those building renewable-energy projects, there are no comparable incentives for domestic equipment makers."
I think this stupid provision was a thank you to Iron/Steel and Labor money received during the campaign.
This was nothing more than a disguised subsidy for the Iron and Steel industry. Obama should know better!
piper23 piper23 8 years
"Part of the stimulus bill could create between 1,000 and 9,000 new jobs" That leaves a lot of wiggle room.
Jude-C Jude-C 8 years
Jude-C Jude-C 8 years
Hey, people don't care if they like us, as long as they buy crap from us.
stephley stephley 8 years
Remember yesterday in another thread, when people said Europe had no bearing on anything? Is the whole global economy thing clearer now?
Jude-C Jude-C 8 years
Protectionism isn't the answer. Working with companies to help them produce products of competitive quality and competitive price, without violating American business standards, will be far tougher but be more beneficial in the long run.
genesisrocks genesisrocks 8 years
I just wish there was a better solution to all of this. But of course there isn't otherwise we wouldnt be having this problem right now
gooniette gooniette 8 years
I agree with mydia.
chatondeneige chatondeneige 8 years
Zivanod, there are *a lot* of Great Depression comparisons going on right now, and there are even more things that the administration is supporting and suggesting which made the Depression even worse. We're in for some rough times if Obama doesn't wake up and smell the history books.
StolzeMama StolzeMama 8 years
neither do I, I am just saying. Other countries helped us out by buying war supplies from us. That is what really got us out.
genesisrocks genesisrocks 8 years
Im not sure I wanna go thru another World War Hainan
StolzeMama StolzeMama 8 years
war got us out of the great depression
StolzeMama StolzeMama 8 years
I don't think we should force people to buy/use Americans, but there should be an incentive. We can't go buying everything from third world countries simply because they have a better price. Products made in the US are also subject to some of the highest emissions standards. So purchasing from elsewhere can be ruining the environment.
Jillness Jillness 8 years
Exactly Zivan. During the Depression we had other countries who weren't affected to help get us out. Now, everyone else is down in the mud with us as well. We will certainly need to make sure that we aren't protectionist to our detriment.
Zivanod Zivanod 8 years
American Protectionism will hurt the global economy and not to mention it violates the WTO and NAFTA. And hopefully they remember that this particular policy was used during the Great Depression and actually made it worse.
Jillness Jillness 8 years
This is one of those things where you can take a title of a provision or its opposition and run away with it. I think it is good that the realistic pros and cons are being brought to light.
hausfrau hausfrau 8 years
I agree mydia!
mydiadem mydiadem 8 years
The government should get steel from whatever provider gives the best quality and best price.
UnDave35 UnDave35 8 years
My mrother has lost his job twice in the last 6 months because the companies he worked for went out of business. He programs multi-axial laser cutting machines, that cut parts out of blocks of steel.
starangel82 starangel82 8 years
Talk about a double edged sword there. Surely a compromise can be made because the steel industry is hurting as are companies that rely on steel. One of my friends owns a company that relys on steel as its main product. He says the cost of steel is just steadily going up to the point where it may not be worth the cost of running his company anymore. Sad.
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