The House bill called for all sorts of spending plans but also had clauses to "buy American" goods for the purchase of materials. This may make sense in a isolated world and if the goods cost the same. We will use taxpayer dollars to purchase goods from US firms in order to increase the multiplier effect. However, we live in an integrated world where there are ramifications from our actions. The level of world trade is at all time highs and the overall benefit of lower priced goods for consumers is significant.
The EU has responded that this "buy American" provision smacks of protectionism and would result in sanctions. This is exactly what we do not want to have when we are in a global recession. This would be similar to the Smoot-Hartley tariff issue which plunged world trade into a dramatic decline.
The response by the President was positive. “I agree that we can’t send a protectionist message,” he said in an interview with Fox TV. “I want to see what kind of language we can work on this issue. I think it would be a mistake, though, at a time when worldwide trade is declining, for us to start sending a message that somehow we’re just looking after ourselves and not concerned with world trade.”
We hope that Congress gets the message.
The EU has responded that this "buy American" provision smacks of protectionism and would result in sanctions. This is exactly what we do not want to have when we are in a global recession. This would be similar to the Smoot-Hartley tariff issue which plunged world trade into a dramatic decline.
The response by the President was positive. “I agree that we can’t send a protectionist message,” he said in an interview with Fox TV. “I want to see what kind of language we can work on this issue. I think it would be a mistake, though, at a time when worldwide trade is declining, for us to start sending a message that somehow we’re just looking after ourselves and not concerned with world trade.”
We hope that Congress gets the message.
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