Stimulus spending will face ‘Buy American’ rule
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A ‘Buy American’ provision made it into the final $787-billion fiscal stimulus bill that the House passed earlier today, despite some critics’ fears that the measure will fan protectionist sentiments worldwide.
The measure targets spending in the bill for infrastructure projects. It reads:
None of the funds appropriated or otherwise made available by this Act may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron, steel, and manufactured goods used in the project are produced in the United States.
But the provision has been watered down somewhat. For one, it wouldn’t apply if the government decides that sticking with the rule for a particular project ‘would be inconsistent with the public interest’ -- a standard but nonetheless potentially large loophole.
The language also requires that the government apply the measure ‘in a manner consistent with U.S. obligations’ under international trade agreements.
European nations, Canada and Mexico have trade deals that guarantee their ability to bid on U.S. government contracts, with the exception of transportation, Bloomberg News noted, citing David Phelps, executive director of the American Institute for International Steel.
China, India and other developing nations haven’t signed those accords, which could make it easier to exclude their goods from infrastructure projects.
The U.S. Business and Industry Council, a group of mainly family-owned manufacturers, applauded the Buy-American rule, but with a caveat.
‘If President Obama wants the biggest growth bang per stimulus buck, he’ll work much harder than his predecessors to ensure that federal agencies Buy American at every opportunity, and to keep any presidential waivers to a bare minimum,’ said council President Kevin Kearns.
-- Tom Petruno