|
|
Joined: Sep 2004
Posts: 1,302
Top Banana
|
OP
Top Banana
Joined: Sep 2004
Posts: 1,302 |
These are very challenging times for the global economy. President Obama's stimulus package which is about to be passed by the American Congress includes a "buy American" clause which essentially will make it impossible for Canadain goods (and those of other countires) to be used in any project funded by the goverment. On the surface, this must seem like an appealing plan to many Americans. But at a time when the private sector is so fragile, what it will do is intensify the global recesssion. It will be, in its impact, similar to the infamous Smoot-Hawley Tarriff of 1930 which had a disastrous impact on world trade. As well, it will be a violation of the NAFTA treaty. Canada and the United States are major trading partners. Freer trade between the two countries has resulted in more jobs on both sides of the border. We buy more of your stuff and you buy more of our stuff.  But that now is about to end. Is this punitive clause the 'change and hope' and "new way of doing things" that Obama campaigned on? Perhaps it's time for him to use that special talent he has for communicating and convince Americans that FDR had a point when he proclaimed that "We have nothing to fear but fear itself." carol
|
|
|
|
Joined: Apr 2003
Posts: 266
Hack from Nowheresville
|
|
Hack from Nowheresville
Joined: Apr 2003
Posts: 266 |
There's a lot of stuff I'm unhappy about with this so called economic stimulus plan. I wasn't aware of that specific part, but I'm not too surprised, as this whole thing seems to have been designed to absolutely destroy a lot of things.
Tara
Rose: You're NOT keeping the horse!
Doctor Who: I let you keep Mickey, now lets go!
Doctor Who, The Girl in the Fireplace
|
|
|
|
Joined: Apr 2003
Posts: 2,837
Pulitzer
|
|
Pulitzer
Joined: Apr 2003
Posts: 2,837 |
President Obama's stimulus package which is about to be passed by the American Congress includes a "buy American" clause which essentially will make it impossible for Canadain goods (and those of other countires) to be used in any project funded by the goverment. In reality, that's impossible. We don't make anything anymore and buy everything. The most it can do is make the project coordinating company an American company. I would say it is just a political token statement.  Artemis
History is easy once you've lived it. - Duncan MacLeod
Writing history is easy once you've lived it. - Artemis
|
|
|
|
Joined: Sep 2004
Posts: 1,302
Top Banana
|
|
OP
Top Banana
Joined: Sep 2004
Posts: 1,302 |
Artemis, I would hope you're right that the clause is a "token" but it seems to be very specific. It targets steel and iron and manufactured goods. Now Canada has been a major supplier of steel to American markets and so this legislation will have a significant impact on us. Here's a link to a column in today's Globe and Mail. There are similar articles in other Canadian newspapers as well. There's great concern here, and in other countries too, I gather. Global Trade Wars...
|
|
|
|
Joined: Apr 2003
Posts: 2,837
Pulitzer
|
|
Pulitzer
Joined: Apr 2003
Posts: 2,837 |
Here's a January report in PDF on US steel imports and production. The US is third in the world after China and India. We imported most of our steel from China. The big increase was from Australia and Canada didn't even make the list of the top 10 countries we import from. With an appetite like that even in a recession, we're still going to be importing. So we'll have to see how it all shakes out. Jan Steel Report The US steel workers are saying "give us the business" but we've shut enough plants we simply don't have the capacity any more. Artemis
History is easy once you've lived it. - Duncan MacLeod
Writing history is easy once you've lived it. - Artemis
|
|
|
|
Joined: Sep 2004
Posts: 1,302
Top Banana
|
|
OP
Top Banana
Joined: Sep 2004
Posts: 1,302 |
Thanks for the link , Artemis. But that Canada does not figure in that list, does not mean that the trade is insignificant to us. Remember, we are are demograohically a small nation, 1/10th the size of the US.
It does indeed look like the US has written off its ties with Canada.
At the Davos summit this week, no major American policy makers attended. That too seems significant.
This is looking like a replay of 1930. When the world's largest economy turns protectionist, the rest do too in reaction, and the recession intensifies, as global trade slows, and so more jobs are lost.
carol
|
|
|
|
Joined: Jun 2003
Posts: 1,763
Merriwether
|
|
Merriwether
Joined: Jun 2003
Posts: 1,763 |
I wish more goods were made in our own country; my country being Canada.
I want the same for them... though, it's sad that the USA seems to be cutting Canada off.
I wish we had more protection of our industries. My city had tones of sewing factories. Within the past 10 years, we have had an increasing amount of empty buildings. My husband was in that industry (they made Silver Jeans, etc.). Everything left for China.
When I went to England when I was little I could find all sorts of trinkets made in the UK. When I went two years ago, almost all the items I looked at were made in China. That bummed me out.
I guess in return we could always charge more for our hydro, oil and water. There's always an article in the paper about how the USA requires more hydro from us. Always reminders from our providers how to reduce our own energy use so we can sell more... sigh. I've always thought it's such a valuable resource and it shouldn't be given away in a cheap fashion... due to the environmental cost I've seen in our particular province. Ouch, off topic sorry.
I'm in much need of a bubble bath now made happy style by Lush products. YIPPEE!
I've converted to lurk-ism... hopefully only temporary.
|
|
|
|
Joined: Apr 2003
Posts: 3,644
Pulitzer
|
|
Pulitzer
Joined: Apr 2003
Posts: 3,644 |
I hadn't heard that, specifically... I had heard about the possibility of a trade war with China, which would be insane of us. "Protectionism" pretty much only hurts everybody. For one thing, with less competition, American companies get lazy -- look at what happened with the automakers in the late 70s. When Japanese cars came along, they were significantly better, and Detroit didn't know how to handle it. Still don't, apparently. When you're at war, and you want to hurt an enemy, you can blockade his ports -- stop imports and exports. Protectionism is when you do the same thing to yourself.  We seem to have an awful lot of economic illiterates in DC. And they seem set to cause an awful lot of damage, to us and our trading partners. At least Republicans aren't getting sucked into supporting it... not in the House, anyway. This is the Obama-Reid-Pelosi "destroy the world's economy" bill. They can't stop the Democrats, since Americans voted for them in large numbers, but Republicans don't have to share the blame. Which is cold comfort. PJ
"You told me you weren't like other men," she said, shaking her head at him when the storm of laughter had passed.
He grinned at her - a goofy, Clark Kent kind of a grin. "I have a gift for understatement."
"You can say that again," she told him.
"I have a...."
"Oh, shut up."
--Stardust, Caroline K
|
|
|
|
Joined: Apr 2003
Posts: 2,837
Pulitzer
|
|
Pulitzer
Joined: Apr 2003
Posts: 2,837 |
When you're at war, and you want to hurt an enemy, you can blockade his ports -- stop imports and exports. Protectionism is when you do the same thing to yourself. Yes, that's right. I can't get too worked up about "Buy American" wordage because I've been around this pony track before. Pretty much it is toothless policy because it is impossible to execute in the modern global economy. Yes, they may say it, but the exceptions will rule the day and it will be business as usual. Call me a cynic, but that's what 35 years in the government will do to you. Artemis
History is easy once you've lived it. - Duncan MacLeod
Writing history is easy once you've lived it. - Artemis
|
|
|
|
Joined: Aug 2005
Posts: 5,797
Nobel Peace Prize Winner
|
|
Nobel Peace Prize Winner
Joined: Aug 2005
Posts: 5,797 |
This was published in today's New York Times. I found it interesting. If We Buy American, No One Else Will Ann
|
|
|
|
Joined: Jun 2004
Posts: 3,145 Likes: 3
Pulitzer
|
|
Pulitzer
Joined: Jun 2004
Posts: 3,145 Likes: 3 |
A majority of the voters in this last election felt the need for "change" without knowing exactly what the change was going to be. We're starting to see some specifics of that "change" now, and they look a lot like FDR's policies of his first two terms in office. What most people don't know is that the New Deal was a bad deal for the US and for the world. The socialist and protectionist policies enacted then were intended to boost the US economy, but they ended up prolonging the Great Depression and making the 1937-38 recession far worse than it might have been.
No, really, there was an economic downturn during the Great Depression. Sounds counter-intuitive, I know, but it's true.
The media's slobbering love affair with Barack Obama (not my term; I stole it from a recent book) has obscured the dangers of his economic philosophy. It has never - never - helped any social class when politicians have simply thrown money at them without direction or restriction. Lyndon Johnson's War Against Poverty in the 1960's made no real difference in the number of Americans living in poverty. The programs of the 1980's and 1990's which were aimed at combating homelessness by giving away houses and apartments and living allowances didn't significantly affect the number of people living on the streets of our cities. And the current "economic stimulus" being debated in Congress is just more of the same. We're about to throw money at an economic blaze which uses money for fuel. I'm amazed that some of these people haven't killed themselves trying to put out a campfire with gasoline.
Carol, I understand your concerns and I share them. The US economy won't get healthier by beating up on other nations' economies. Artemis is right; we can't cut off international trade and expect to correct our money woes. In fact, one of the causes of the War of 1812 with Great Britain was a severe economic downturn in New England caused by an American boycott of all European trade (put in place by Jefferson's Presidential executive order, not an act of Congress) in reaction to the British practice of impressing sailors from neutral countries to serve in the Royal Navy. Interesting fact: that practice had all but died out by 1812 because the British no longer needed so many sailors to fight the French by then, and because voices in Parliament were raised in opposition to the practice on both moral and practical grounds. The point is that America has always depended on foreign trade for its economic health, and plans with force companies to "buy American" even when the goods are not readily available or are of inferior quality is doomed to failure. That aspect of the plan is a political concession to the labor unions in the US as much as it is a statement of principle.
Thanks for the link, Ann. Interesting to see the New York Times publish a statement like that one.
We're all going to see some rough times for a while. It's going to take some time to dig out of the hole our government has shoved us in. I only wish that they could see that frantic activity at the bottom of a hole usually just makes the hole deeper.
Life isn't a support system for writing. It's the other way around.
- Stephen King, from On Writing
|
|
|
|
Joined: Apr 2003
Posts: 2,837
Pulitzer
|
|
Pulitzer
Joined: Apr 2003
Posts: 2,837 |
The economist for the LA Times agrees with the Washington Post: Buy American' provision in stimulus bill makes no economic sense
A requirement that most stimulus-funded projects use only U.S.-made gear and goods is shortsighted, knee-jerk protectionism.
David Lazarus
February 1, 2009
When the going gets tough, the tough buy local.
That's the crux of the more than $800-billion economic stimulus bill under consideration in the Senate. It contains a "buy American" provision requiring that most stimulus-funded projects use only American-made gear and goods.
The House passed its own version of the legislation last week. It stipulates that we not buy any iron and steel from pesky foreigners seeking a slice of stimulus pie.
I'm thinking that it's all well and good to wave the flag when our national economy's on the line. But aren't we being just a tad shortsighted with all this knee-jerk protectionism?
Andrew Rose, a professor of international trade at UC Berkeley's Haas School of Business, said you could practically set your watch by how quickly protectionist sentiment ratcheted up whenever the economy turned sour.
And in almost all cases, he said, "buy American" provisions are a bad idea.
"It's certainly a bad idea for the rest of the world, and it's a bad idea for us as well," Rose said. "If we only buy American, we'll probably pay more for inferior goods."
You don't have to be a Nobel Prize-winning economist to see how this will play out. Take steel, for example.
Nearly a third of all steel purchased in the United States -- primarily for construction and cars -- comes from overseas. That is, U.S. steel mills are meeting only about 70% of domestic demand.
If those mills suddenly had the market to themselves, at least for big, fat government infrastructure projects, what do you think would happen? Is it possible that, I don't know, their prices would suddenly go up as they realized Uncle Sam had nowhere else to shop?
"The single issue that unites all economists is that the freer the trade, the better," Rose said.
Our friends abroad certainly think so as well. A spokesman for the European Commission said a "buy American" provision "is not something we will stand idly by and ignore" -- meaning that they will be looking closely to see if it violates trade accords.
Similar concerns were voiced by Canada, Australia and others that look to the United States for free-market leadership. The White House said Friday that President Obama hadn't yet decided where he stood on the issue.
We've been down this road before. Buy American ruled the day during the Great Depression. All it did was prolong the global downturn.
So why do our lawmakers persist in throwing good economic sense out the window? That's easy: Because politics and good economic sense seldom go hand in hand.
When the chips are down, what politician doesn't want to appear in his hometown newspaper saying he's doing his share to keep taxpayers' hard-earned money from ending up in the hands of the Chinese or the Indians?
A survey conducted last week by the industry-backed American Iron and Steel Institute found that 86% of poll respondents favor using American iron and steel for stimulus-funded transportation and infrastructure projects.
"This survey shows that Americans support a common-sense approach to rebuilding the economy," institute President Thomas Gibson said.
"Americans want to see American taxpayer funds supporting a stimulus package that will generate American jobs using high-quality, American-made products," he added.
They also really like it when people say "American" four times in a single sentence.
The U.S. Business and Industry Council, a manufacturing-industry organization, tipped its hat as well to the "buy American" provision in the Senate bill.
"A stimulus bill lacking strict 'buy American' provisions will only encourage ever more consumption of foreign goods with borrowed foreign money -- which helped produce today's economic crisis in the first place," council President Kevin Kearns said.
"Any attempts to remove the amendment by multinational, outsourcing special interests should be defeated," he declared.
Look, I'm rooting for the home team as much as anyone -- I don't want American businesses to fail or more jobs to be lost. But as a consumer, I also appreciate the importance of shopping around.
We're going to be using a whole lot of steel over the next few years as hundreds of billions of dollars in taxpayer funds get pumped into everything from new bridges to new energy systems.
If the Chinese, say, are selling steel for 10% or even 20% less than U.S. producers, are we really doing ourselves a favor by saying thanks but no thanks?
Put another way, I enjoy the experience of shopping at Whole Foods. But I still buy my toilet paper and other staples at Costco. Why? Because I'm not stupid. I want to stretch my money as far as it'll go, especially during times like these.
I don't blame U.S. business for looking after their own interests. If I was Halliburton and Uncle Sam offered me multimillion-dollar, no-bid contracts for services in Iraq, I'd probably have taken full advantage of the situation too.
That's why one lesson we learned from that particular fiasco was not to hand out goodies to businesses without first playing the field. The same applies now.
It seems perfectly reasonable to expect that all jobs created by the stimulus package will be in America and filled by Americans. U.S. taxpayers have a long and noble tradition of putting their own to work when times are bad.
But let's not abandon our economic principles for the sake of petty patriotism. Buying American should be a goal of any stimulus plan, but it shouldn't be a requirement.
And I say that as a proud American, not as a multinational, outsourcing special interest.
David Lazarus' column runs Wednesdays and Sundays. Send your tips or feedback to david.lazarus@latimes.com. I think this is the heart of the solution: Buying American should be a goal of any stimulus plan, but it shouldn't be a requirement. Artemis
History is easy once you've lived it. - Duncan MacLeod
Writing history is easy once you've lived it. - Artemis
|
|
|
|
Joined: Apr 2003
Posts: 9,362
Boards Chief Administrator Emeritus Nobel Peace Prize Winner
|
|
Boards Chief Administrator Emeritus Nobel Peace Prize Winner
Joined: Apr 2003
Posts: 9,362 |
From the BBC news website: Buy US Clause weakened How refreshing to find a politician who can listen to opposing viewpoints and then change his mind based on them if he thinks they have merit. Rather than the usual course of blindly and stubbornly burgeoning his way on regardless, no matter what, in the pursuit of his own dogma, just because he can't admit he was wrong. LabRat
Athos: If you'd told us what you were doing, we might have been able to plan this properly.
Aramis: Yes, sorry.
Athos: No, no, by all means, let's keep things suicidal.
The Musketeers
|
|
|
|
Joined: Sep 2004
Posts: 1,302
Top Banana
|
|
OP
Top Banana
Joined: Sep 2004
Posts: 1,302 |
Thanks for that link, Labrat. There may be some hope, after all However, it is troublesome that McCain's less equivocal position was rejected. How refreshing to find a politician who can listen to opposing viewpoints and then change his mind based on them if he thinks they have merit. In his book, Audacity of Hope, Obama criticisized protectionism and, in hindsight ironically, used American steel as an example of how protectionsim weakens an industry. So he has undertstood the larger economic principle all along. Here, in Canada, during the primaries there was a bit of an issue when Obama advocated protectionism when he spoke to workers groups as he sought his party's nomination. Privately, however, his aides reassured Canadian diplomats that he didn't support protectionism. The memo containing that info was "leaked" to the Canadian media. All hell broke lose. But not because of the mixed messages on protectionism, nooo.... but... because some sod in the Canadian embassy had ...  leaked the memo. The media and the Oppostion in parliament blamed our Prime Minister, accused him of embarrassing Obama, etc. Ain't Canuck politics, grand, eh?  But to get back to Labrat's quote, it is good to see Obama back off somewhat, especially given the Democrats' base. Classic good cop, bad cop stuff c.
|
|
|
|
Joined: Apr 2003
Posts: 1,206
Top Banana
|
|
Top Banana
Joined: Apr 2003
Posts: 1,206 |
The stimulus bill is essentially Smoot-Hawley-Keynes, the three recipes that caused and deepened the Great Recession. Keynesian economics, by means of throwing money at things that don't stimulate any economy, just serve to deepen debt and not to create jobs.
The additional wording, weakening the "buy American" provision, was merely added because of the three Republican senators who voted for the original report. The conferees feared losing one or two votes, which would have killed the entire stimulus package. We'll see how dedicated Obama is to his anti-protectionist rhetoric. With him in the unions' back pocket, I don't hold out much hope. His history of saying one thing to one group and the complete opposite to another group (remember those who "cling to their guns and religion" as well as the Canadian memo?) means we can't trust a thing he says. Only his actions will show which is his real philosophy.
One question I have is why the bill costs $800 billion. Only $170 billion of that $800 billion is scheduled to be spent this year. If this thing was SOOOO crucial to keep us from sliding deep into depression, why didn't we just pass a one-year $170 billion stimulus package instead of passing over $600 billion worth of pork that won't be spent until the recession is supposed to be over?
-- Roger
"The Constitution only gives people the right to pursue happiness. You have to catch it yourself." -- Benjamin Franklin
|
|
|
|
Joined: Apr 2003
Posts: 3,644
Pulitzer
|
|
Pulitzer
Joined: Apr 2003
Posts: 3,644 |
Roger, you know the answer to that. It's because this isn't really designed as a stimulus at all; it's just a "get Democrat congresspeople richer and reelected" fund. Well, that and the "get Democrat congresspeople more powerful by taking over large chunks of the economy" initiative. I don't think the Democrats give a crap about my finances, or yours either. They're perpetually looking out for their own, and the rest of us can go to heck.
PJ
who thinks Republicans *ought* to be better than that but all too often aren't...
"You told me you weren't like other men," she said, shaking her head at him when the storm of laughter had passed.
He grinned at her - a goofy, Clark Kent kind of a grin. "I have a gift for understatement."
"You can say that again," she told him.
"I have a...."
"Oh, shut up."
--Stardust, Caroline K
|
|
|
|
Joined: Apr 2003
Posts: 1,206
Top Banana
|
|
Top Banana
Joined: Apr 2003
Posts: 1,206 |
It was sort of rhetorical since we all know the answer. The goal of any politician is to get re-elected, no matter the political stripe. So whatever greases the palms of the supporters is good for the party in power, regardless of what it does to the rest of us.
-- Roger
"The Constitution only gives people the right to pursue happiness. You have to catch it yourself." -- Benjamin Franklin
|
|
|
|
Joined: Sep 2004
Posts: 1,302
Top Banana
|
|
OP
Top Banana
Joined: Sep 2004
Posts: 1,302 |
That Buy America clause still remains worrisome to Canadians. I'll add, too, that it contradicts Obama's rhetoric, when speaking to those outside the U.S. on the topic of global trade. As President he has the power to modify that clause, and as well, he certainly has extraordinary political skills and charismatic influence.
This afternoon, your President visits Canada where he will meet with our PM. Obama is very popular here, and many of our leading journalists are now writing columns or uttering comments that would make a twittering 12 year old appear insightful.
If his visit recieves any American news coverage I'm betting it will *not* mention our trade concerns but *will* report on Obama's popularity here, and oh, yes - we had a bit of snow last night so I suspect they'll report that Obama braved a blizzard to touch base with his Canadian fans.
c. (who has lost hope, you know)
|
|
|
|
Joined: Apr 2003
Posts: 3,644
Pulitzer
|
|
Pulitzer
Joined: Apr 2003
Posts: 3,644 |
it contradicts Obama's rhetoric Gee, there's a shocker. many of our leading jouranlaists are now writing columns or uttering comments that would make a twittering 12 year old appear insightful. That's a funny way to put it, but yeah... they've all lost their minds. Well, that's not fair. They still have minds. It's brains that they're lacking. Would Perry White allow this nonsense? (otoh, I'm sure J. Jonah Jameson would run with it in a second if it suited his purposes...) If his visit recieves any American news coverage I'm betting it will *not* mention our trade concerns but *will* report on Obama's popularity here, and oh, yes - we had a bit of snow last night so I suspect they'll report that Obama braved a blizzard to touch base with his Canadian fans. I'll bet you're right. And we don't know whether to laugh or cry... PJ (CNN.com has it as a Live! Developing! Story! "Obama leaves for Canada" but it's only video and I can't watch those at work)
"You told me you weren't like other men," she said, shaking her head at him when the storm of laughter had passed.
He grinned at her - a goofy, Clark Kent kind of a grin. "I have a gift for understatement."
"You can say that again," she told him.
"I have a...."
"Oh, shut up."
--Stardust, Caroline K
|
|
|
|
