Morning News - "Buy American" and National Interests

Jan 28, 2009

Opposite the editorials in today's Washington Post Harold Meyerson seeks the "last refuge of a scoundrel" in arguing for isolationism as a solution to our current economic woes. Specifically he cites the Chamber's opposition to "Buy American" provisions in the stimulus bill as proof that we are foreign agents and un-American.  On the contrary we are actually very patriotic, as we just addressed yesterday, but for a specific rebuttal let's go to the editorials themselves where the Post writes:

"Buy American" sounds patriotic, but paying more than necessary for steel diverts resources that could create jobs in other industries. Worse, it raises the prospect of retaliation against American exporters by U.S. trading partners. The director-general of the European steel industry trade association already has threatened to take the United States before the WTO if the steel provision passes. (Notably, European stimulus programs do not bar U.S. steel or other products -- yet.)...Once an engine of global growth, trade is already set to decline by 2 percent in 2009, according to the World Bank. It could collapse altogether if countries start shutting out one another's goods in a shortsighted effort to salvage domestic industries. The United States started one such trade war in 1930, when it enacted a tariff increase that prompted European retaliation -- thus helping turn a bad recession into the Great Depression. Better to learn from this history than to repeat it.

The Post notes that U.S. Steel and others certainly have very valid reasons for supporting such provisions, before concluding they are not in the national interest. Moving on to invalid reasons, perhaps Meyerson was wearing his Vice Chair of the Democratic Socialists of America hat when he wrote this column. A devastating depression could help along their "fundamental task...to build anti-corporate social movements" and achieve "radical political, economic, and social changes in the established order." To that I would say, with a few notable exceptions, radical revolutions rarely end well, Viva La Recovery!

Subscribe today for Free Enterprise Updates

  • Latest business trends and best practices
  • News about legislation and regulation impacting business
  • Business how-to articles from industry experts
  • Commentary and interviews with newsmakers in business and politics