Feb. 4 (Bloomberg) -- Congressional leaders, trying to quell a dispute over “Buy American” provisions in the stimulus package, are crafting a version that would apply only when they don’t violate trade rules, according to industry officials and a congressional aide. The lawmakers are reacting to a demand by the White House that the provisions satisfy U.S. obligations under the World Trade Organization. President Barack Obama “wants to ensure that any legislation that passes is consistent with trade agreements and doesn’t signal a change in our overall stance on trade,” White House Press Secretary Robert Gibbs said at a news briefing today.
The House Ways and Means Committee’s Democratic staff and aides to Senate Majority Leader Harry Reid, a Nevada Democrat, are working out the language, said a lobbyist who was briefed on the measure. The people familiar with the talks declined to be identified because the talks are confidential. Ways and Means spokesman Matthew Beck didn’t have an immediate comment, and Reid spokesman Jim Manley didn’t return a telephone message.
Steel companies, such as U.S. Steel Corp. and Nucor Corp., and labor unions are pushing language in the stimulus plan to mandate that projects use American-made iron, steel and other manufactured goods in building projects such as roads, bridges and tunnels.
They argue that the amendment, passed by the House of Representatives last week, already gives the Obama administration the option to waive that requirement if it would run counter to the rules of the WTO or North American Free Trade Agreement.
“We’ve always said this doesn’t violate our trade laws,” said Robert Baugh, executive director of the Industrial Union Council at the AFL-CIO. “If they need to restate it, fine.”
Caterpillar, Microsoft
Some opponents of the Buy American plan, including Caterpillar Inc., Microsoft Corp. and the U.S. Chamber of Commerce, have said that even a version that doesn’t violate trade rules might spur protectionist measures around the world.
Canada and the U.S. have the world’s largest commercial bilateral relationship, with about $600 billion in total trade last year. Nafta, which includes the U.S., Canada and Mexico, prohibits the U.S. from cutting Canadian companies out of many government contracts.
The U.S. House approved a stimulus plan last week that included a mandate that all the iron and steel used in the stimulus be made in the U.S. The Senate is debating an $885 billion measure that would require that all manufactured goods be covered by the provision.
Obama told ABC News yesterday that he didn’t want any Buy American provisions that would violate trade rules.
“We need to make sure that any provisions that are in there are not going to trigger a trade war,” he said.
Poster Comment:
The White House is pressuring them to betray American workers.
