Thursday, September 15, 2011

Why 'Buy American' isn't the answer -- Sept. 15, 2011 column


I snagged a patriotic, giveaway T-shirt at a Washington Nationals baseball game the other day. Stars and stripes decorated the team’s curly W logo, but the tag inside said “Made in Mexico.”

Visiting Ocracoke, N.C., this summer, I stopped by a National Park Service shop and got a souvenir shirt -- made in India. The flagpole I bought at the neighborhood hardware store so I could fly Old Glory outside my house? It was from China.

Like most people, I’d rather buy American, and I’m willing to pay a little more for the privilege. Reports say if each American spent an additional $64 a year on American-made goods, we could create 200,000 new jobs. That sounds good, if the jobs are decent. I’m inclined to let China keep the crummy ones and for us to create jobs with a future.

Politicians tend to go for the easy fix. Sen. Bernie Sanders, I-Vermont, shopping at a Smithsonian Institution museum shop last year, was distressed to find miniature busts of the Founding Fathers and other trinkets made in China. He pressured the Smithsonian to sell more items made in the USA.

In June, the Museum of American History opened The Price of Freedom shop on the third floor. The shop’s name isn’t a snide comment about higher prices, although American-made coffee mugs cost about $20 each, compared with $10 to $12 for mugs made overseas, a museum spokeswoman told USA Today. “The Price of Freedom” is the name of a nearby exhibit.

In July, the Senate passed a measure requiring that all American flags purchased by the federal government be entirely American-made. Previously, flags with 50 percent foreign content were OK. The House likely will wave the flag bill through this fall.

Such moves are dandy symbolism, and they play well politically. When President Barack Obama hit the road this week to sell his $447 billion package to create jobs, he made restoring the nation’s manufacturing base sound simple.

“We’ve got to start manufacturing. We’ve got to sell more goods around the world that are stamped with three proud words – “Made in America,” the president told a cheering crowd in Columbus, Ohio.

Applause greeted a similar Obama line in Raleigh, N.C., the next day. “We’ve got to start manufacturing and selling more goods around the world stamped with three proud words: “Made in America. Made in North Carolina. Made in Raleigh,” he said.

But a Buy American provision in Obama’s bill has ruffled relations with Canada.
Obama’s American Jobs Act would require that only iron, steel and manufactured goods produced in America be used for public buildings and public works. More than $100 billion could be made available for projects renovating schools and building roads and bridges and other transit projects.

The Buy American rule seems sensible, considering that the bill’s purpose is to create American jobs.

Unacceptable, says Canada’s trade minister. Canada plans to fight, as it did a similar provision in the 2009 economic stimulus act. Canada won an exemption that time.

A nationalist group called the Council of Canadians is calling for a “Buy Canadian” movement to freeze out American firms, the Toronto Sun reported.

In Washington, the unfolding Solyndra scandal comes at the worst possible time for a president trying to pry funding from a reluctant Congress.

The FBI launched a criminal investigation and Congress held hearings about the bankruptcy of Solyndra, a Silicon Valley solar-panel manufacturer that received a $527 million federal loan guarantee as part of the 2009 stimulus package. When it shut down, the company laid off about 1,100 workers.

Congressional Republicans charge that the administration hurried the Solyndra loan guarantee so it could show that the stimulus worked in creating jobs. The administration denies it rushed and insists that the 2009 stimulus package is helping create a viable American solar industry.

Solyndra was the third American solar company to declare bankruptcy in the last few weeks. Corporate executives and federal officials blame China’s aggressive efforts to dominate the solar industry. China reportedly has plowed $30 billion into solar subsidies in the last year and is flooding the market with cheap solar cells.

Too bad the Smithsonian stopped buying those trinkets. China will never give up on that solar thing now.

(c) 2011 Marsha Mercer. All rights reserved.

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