Two of America’s largest and most successful companies are facilitating in the demise of America's manufacturing base. General Electric Co. and Caterpillar Inc. are imploring President Barack Obama and Congressional Democrats to drop a “buy American” provision included in the $850 billion stimulus package, according to Bloomberg News.
Backed by both the U.S. Chamber of Commerce and the Emergency Committee for American Trade, GE and Caterpillar are claiming that forcing companies that participate in the stimulus plan to buy American-made products could spark a trade war.
What they fail to realize, however, is that America is already in a trade war - and losing badly.
“Free trade” has only served to allow the nation’s trade deficit to explode to uncontrollable levels, killed jobs, armed economic rivals with the means to buy up American assets and businesses and allowed our shores to be invaded with toxic products from Third World nations.
The U.S. Chamber of Commerce, the Emergency Committee for American Trade in Washington and other businesses wrote a letter to House Speaker Nancy Pelosi in opposition of the “buy American provision. The group claims that a “buy American” clause would undermine American economic leadership by violating a pledge the U.S. and other governments made made in November, which vowed not to enact any new trade barriers for the next year..
Thankfully lawmakers do not seem to be listening. On Thursday, the House Appropriations Committee added a clause to the package that will not allow any stimulus funds to be used “unless all of the iron and steel used in the project are produced in the United States.”
In addition, lawmakers are also considering allowing certain purchases to come from countries that have signed the World Trade Organization’s government procurement agreement. They say the provision would effectively ban the purchase of products from both China and India while still being in compliance with WTO rules.
The procurement agreement was signed by 27 developed nations on January 1, 1996 and one of the provisions states that the agreement was implemented to duly take into account the development, financial and trade needs of developing countries to promote the development of domestic industries in rural or backward areas. The provision states that “each Party shall facilitate increased imports from developing countries at low stages of economic development.
The “buy American” clause should facilitate the growth of the American economy which does not mean importing products from other countries. While the provision may ban the purchase of products from China and India, other countries such as France and the United Kingdom are not prohibited from purchasing products from developing nations, marking them up and filtering them off to us as part of the “buy American” clause. In which case the purpose of such a clause would be completely null.
Aside from publicly crying “trade war,” the real reason GE and Caterpillar do not support the “buy American” provision is the fact that both are multinational corporations that exploit the cheap labor markets of the Third World. Half of all of GE’s sales come from outside the U.S. while Caterpillar generates 60 percent of its revenue in other nations.
"I don't want to see these stimulus dollars being spent buying electronic equipment made in China," Sen. Sherrod Brown (D-OH) said.
Indeed, any stimulus plan without a “buy American” provision is defeating the purpose of a “stimulus plan” as well as being an exercise in futility.
“If American tax dollars are going to be invested, it seems only rational that American products would be favored,” said Terrence Straub, vice president for government relations at U.S. Steel. “The whole intention is to stimulate the creation of American jobs.”
Our “free trade” policies have turned our corporations against us. They are merely concerned with reaping their own profits, at the expense of American citizens. The U.S. is in dire straits and industries need to band together to propel this nation forward. We cannot allow our stimulus money to be siphoned into foreign economies, when our economy is reeling.
What is worse is that the U.S. Chamber of Commerce, the world's largest not-for-profit business federation, is defending these corporations, aiding and abetting this race to the bottom. The Chamber of Commerce was established to represent the unified interests of U.S. businesses. However, the organization uses its highly influential lobbyists to sway votes in Congress, pushing its agenda of unfettered “free trade.”
Front Page Photo by: johnpwatts – Google Images some rights reserved
