Buy American: Another Job Killer in the Jobs Bill

ATR ^ | 2011-09-22 | Kelsey Zahourek

[92nina]

...I understand political motives behind these sorts of measures, but it makes horrible economic sense. Yet Obama has once again chosen politics over the economy. Within the President’s “American Jobs Act” lies a provision that mandates all iron, steel and other manufactured goods must be domestically produced as part of around $80 billion in infrastructure spending. Such protectionist measures raise costs for consumers and businesses. When businesses are forced to pay more for products, that increase gets passed on to consumers, who are then forced to forgo spending elsewhere. In other words, by protecting one industry, countless others are losing billions of dollars in profits. Not only do Buy American provisions restrict growth, but they inevitably cost more jobs than they purport to create. After the 2009 provision, employers across the country were forced to lay off workers as a direct result of Buy American requirements. One factory in Pennsylvania let go 600 employees because some of its products include goods produced overseas. The insistence on the Administration including time and again this protectionist provision proves they don’t know the first thing about economic growth and job creation. As pointed out on this site numerous times, there are many, many things wrong with Obama’s jobs legislation and the entire bill should be scrapped.

Read more: http://www.atr.org/buy-american-another-job-killer-jobs-a6470#ixzz1YnbVnPRb

[92nina]

"Included within the 2009 “stimulus” plan was the protectionist Buy American provision that required manufacturers to give preferential treatment to domestic producers of iron, steel and other manufactured goods in spending on infrastructure..."

Take this article and others I found to the fight to the Libs on their own turf; put the Left on the defensive at Digg and at Reddit and in Stumbleupon and Delicious

[traditional1]

What Republicans need to do with THE VERY NEXT APPROPRIATIONS BILL is to add an Amendment to REPEAL THE DAVIS-BACON ACT. This will be a true stimulus to the economy, where competitive bidding and free enterprise are re-introduced in all government contracts.

THE NEXT APPROPRIATIONS BILL should include REMOVING UNION MEMBERSHIP FROM ALL GOVERNMENT JOBS, period.

These two things, alone, would drive competition, lower costs to consumers, and stop the socialist takeover in its tracks.

[DannyTN]

"Such protectionist measures raise costs for consumers and businesses."

What consumers? The 20% Americans unemployed aren't consuming. The other 80% aren't consuming either for fear they are going to soon join the 20%.

Maybe it's Chinese consumers you are talking about? Yes, heaven forbid we raise the cost to them. Oh wait, the Chinese don't consume much of our products either, their government just hoards the money to buy our debt and to buy more American companies like defense part manufacturers that they dismantle and move to China.

[Last Dakotan]

Would you have expected Americans to pay taxes to stimulate China's economy?

China now sends entire bridges to the US.

[Last Dakotan]

Great ideas.

[veracious]

Nuts. Buy USA only, pay the price to give your neighbors and countrymen jobs! Duh.

[Eva]

There is another project in the works on the West coast, It was presented as a coal terminal to ship coal terminal, and then expanded to a bulk cargo terminal to ship grain and other US products to China. But now, buried in the permit application is the description, Export/Import terminal. Jerome Corsi claimed in an old article that SSA (the ILWU company who is developing the Gateway port) was searching for a deep water port location to import more Chinese goods into the NAFTA trade route, that would eliminate cross border inspections. I suspect that the idea had more to do with shutting out the Mexican and Canadian truckers than the cross border inspections, but special economic zones in Gateway ports also minimize import inspections. This port is receiving a lot of support straight from the White House. Patty Murray has a bill sitting in committee in the Senate to pay for it with federal funds (the bill is actually the Infrastructure spending part of Obama's jobs bill.) and Patty Murray's husband is a lifetime employee of SSA.

[DannyTN]

Free Trade works only when countries are equal trading partners.

An example of free trade working is this:

• Country #1 produces WidgetA at a cost of $1.00 and WidgetB at a cost of $3.00.
• Country #2 produces WidgetA at a cost of $3.00 and WidgetB at a cost of $1.00.
• By specializing in production and trading both countries enjoy more WidgetAA and more WidgetBs and at a lower cost.

An example of Free trade not working is this:

• Country #1 produces WidgetA And WidgetB.
• Country #2 produces neither, but has abundant excess labor.
• By Trading, Country #2 produces both WidgetA and WidgetB cheaper than Country #1 did.
• To make matters worse Country #2 doesn't buy any products from Country #1 with the proceeds of Widgets they sold to Country #1.
• Instead Country #2 use the proceeds to buy the manufacturing firms that manufacture other widgets in Country #1 and dismantle them and move them Country #2.
• Country #1 gets cheap widgets initially but soon has high unemployment and no money to buy widgets from country #2.

[92nina]

Repeal David-Bacon and public-sector unions in the Federal government? Yes! Now that’s what I like to hear.

[AEMILIUS PAULUS]

It is time to start rejecting the cosmopolitan Free Trade fraud. It is an 18th century out of date theory which had as its main purpose protecting England's trade monopolies. England built up its economy by NOT practicing "Free Trade." Once the English had achieved their position as top dog the "Free Trade" propaganda commenced.

We need an American System that favors our nation and people.Begin protecting or subsidizing industries that will build our nations wealth. Our nation underwent its greatest growth when it favored its own people.

[Herbster]

I love this example.

So are tariffs in demand?

Making companies search for American made manufacturing for all the components necessary to complete the contract seems on the face of it like a good idea at first glance. However in order to qualify for the (Marxist moslem American hater) contract, it puts the fragile manufacturing base we have remaining here in America through hoops and red tape that will end in exactly what you state.

Where do we go from here?

Am I way off base here?

[DannyTN]

I think tariffs are the way to go, but I think they should be selective.

I agree that searching for American made components is a cumbersome and expensive way to go about it. Though I'm not opposed to the idea when the money being spent is tax dollars. It might be the only way we can enforce it given current trade agreements, but I think those trade agreements need to be reworked.

And by selective tariffs, I mean tariffs that target the worst trade offenders and most unequal partners. That'd be China.

• Put Tariffs on the high dollar electrical and electronic components we import from China. The kind of industries we want to retain in the U.S. And the kind that are likely to afford a decent living for American workers without too high of a price differential. Targeting these sectors would bring the trade deficit down quickly.
• Consider products that have a high labor component that aren't necessarily high tech or valued industries. The idea here is strictly to get unemployment down. We should consider the following factors:
• Consider products where the price differential between importing and producing domestically isn't that great. So that you get the most labor impact for the consumer's incremental spending.
• Consider products where the raw materials can be sourced here. So you get the most labor impact from the entire chain of production.

I think some of the tariffs should float based on our unemployment numbers. The lower the unemployment, the more lax the tariffs.

[RnMomof7]

Exactly .. and of course there are a couple more free trade bills soon to be signed (left over from the GWB administration ..)

Washington has given away manufacturing jobs and then they wonder why there is no recovery.. how do we elect such dumb people.???. or are they all playing dumb so they can continue to fed at the hands of all those lobbyists??

[traditional1]

Or, to put it another way, Country #1 has Union labor, which hikes its benefits and wages and overhead (Union Bosses/Political Contributions) so high that the company moves to where there's super-cheap labor, has to pay a lot of transport costs, and STILL delivers the product at lower cost and at a reasonable profit.

Meanwhile, back in Country #1, the Unions decide to infiltrate government at ALL LEVELS, so they can continue their extortion, this time at the un-limited upside potential at the command of Taxpayers (simply by paying off politicians through contributions and quid pro quo Legislation to protect the money machine).

Is this a grand idea, or what?

[DannyTN]

I’m not fond of unions, but you could roll back all the salary gains attributed to unions and we still aren’t going to compete with billions of Chinese willing to work for $2 a day.

Only 11% of the U.S. workforce is unionized and only 7% of the private sector is unionized. You make a good point about unions taking over government, but unions are simply not the real issue causing this economic crisis. Neither is government taxes and regulation, although everyone would like to see less of both.

[American Constitutionalist]

Lehman Brothers was heavily invested in Wind and Solar and was one of the reasons why it went under.

[traditional1]

"but unions are simply not the real issue causing this economic crisis"

The COST of government, at all levels, is astronomical, as is the funding of bailouts to favored groups (banks, pension funds, etc.), which is ALSO payback for continued support of politicians. For example, quality of public education is in the toilet, the Union rules have made incompetency a protected species, and un-limited funding from special interests to keep buddy-buddy Legislation and Funding-steering of taxdollars to supporters have created the largest money-making machine in the world (American government at all levels).

The bottom line is that the Government is the siphon, and the taxpayer is the target. They've over-spent future revenues, and continue to do so, leaving taxpayers on the hook for their greed.

[television is just wrong]

there is very little made here and it is impossible and stupid.

[DannyTN]

Government may well be a siphon, but that's not the real issue driving this economic downturn. There are two key factors.

• The oil price shock which has signficantly zapped consumers in the pocketbook killing disposable income and resulting in the job losses and mortgage failures.
• Unwise trade agreements that are siphoning off jobs to cheaper labor countries and leaving us unemployed. You can stop all government activity and before we would dissolve into somalia, you still couldn't compete with $2 a day labor from China. No amount of anti-union legislation, or government dismantling or ending taxes is going to compete with $2 a day labor. That's the issue. We have to protect enough of our industries to keep our people employed. Once were back to full employment, we can make use of the $2 a day labor. Otherwise, we'll eventually be working for $1 a day to regain our lost marketshare.

[traditional1]

"Otherwise, we'll eventually be working for $1 a day to regain our lost marketshare"

Yeah; you're right.

Lets let the AFSCME, SEIU, NEA members continue at their escalating over-compensated rates, and maintain our "living wage" for those who produce ZERO.

There's about 15% of the REAL WORKFORCE who are making $0 right now, not even $1 a day. NO ONE is forced to buy imports, and they are touted and sought by Americans. That's what a State-Run-Media does. Thanks to the socialists (in concert with banking and corporate interests), the high contributors are rewarded with letting them move production off-shore, to avoid the Unions and save overall costs, then return goods for sale without tariffs. We allow parasites to live off others earnings via income taxes, fees, regulation, to buy their votes, and reward cheap labor by subsizing their illegal entry into this Country, and then handing them parasitic benefits, too.

We need a do-over, and it's coming.....