'Buy American' hurting America?

Posted Sep 17th 2009 10:30AM by Mark Fightmaster
Filed under: Columns, Canada, Economic Data

We are all familiar with the "Buy American" clause that is part of the $787 billion stimulus package and is designed to help U.S. companies battle foreign competition. But is it really doing what it's supposed to? This Wall Street Journal article takes a look at an American company that is losing a good deal of its business to foreign competition -- thanks to the Buy American provisions.

Apparently, there is growing resentment toward America for the Buy American provisions that has lead to a Buy Canadian campaign. In fact, one town in Canada (Halton Hills) is cited as one of roughly a dozen Canadian communities that are trying to freeze out American companies. The town's mayor stated, "We won't be taking any products from any country that is discriminating against us."

Wow, discriminating? Quite honestly, this is a word that has been thrown around so much lately that it doesn't have quite the impact that it used to in the past. That said, saying that America is discriminating against other countries because of the Buy American provision seems like it is a bit of overkill to me.

I don't see how encouraging your nation to use local businesses is an act of discrimination. In fact, I would think that boycotting another country's products because of their policies would be the definition of discrimination. Correct me if I am wrong, but the provision in the stimulus package doesn't say that companies will be punished for not buying American. Of course, I am not 100% sure on how discrimination works, perhaps I should ask Jimmy Carter -- as he is the expert.

However, this is not the crux of the article. The Journal concentrates on how this provision is hurting small companies, stemming from disruptions to the supply chain, contracts, and the like. If this is truly the case (which I don't doubt), then perhaps we need to get a "No Red Tape" provision rather than a Buy American provision.

Tags: America, American products, AmericanProducts, buy american, BuyAmerican, canada, canadian, discrimination, featured, NAFTA, red tape, RedTape

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Reader Comments (Page 1 of 1)

9-17-2009 @ 2:04PM

ij70 said...

This is silly article. Hardly anything is made in America. Or. Are we talking North America and South America? Then I really don't see why those Canadians, in the example, are so upset.

9-17-2009 @ 5:37PM

thedude said...

Globalization is KILLING the USA and every other country as well. Do you think there would be a global economic crisis if it wasn't for the fact that so many other countries want to play in the USA's financial sandbox.

Every country MUST be industrially, agriculturally and economically independant while maintaining some form of political cohesion.

The US needs to cease exporting any raw materials and cease importing MOST foreign made goods. Obviously we benefit from importing unique products like Ferraris Porsches, regional wines and cheeses, Rolex and Omega watches and certain fruits.

Plastic toys form China though? I don't think so ! We can make them in the USA just as crappily as the Chinese do although we may not be able to produce them with the same lead content or other haz-mats.

As for international labor I agree, Canada should not bu using US contractors to get the job done and law abiding US contractors shouldn't have to compete against scoflaw contractors who employ mostly illegal aliens

Not only is protectionism good for the US (it did get us through two world wars afterall) but it is good for ALL countries.

@ij70 - there are thousands of products still made in the USA, you jsut have to stop being lazy and complacent and actually be a conscientious consumer