Tag Archives: steel industry

In his interview this evening with Charlie Gibson, President Obama said – okay, we’ll say “implied” – that he wants the controversial (read: stupid) “Buy American” provisions removed from the stimulus bill:

CHARLES GIBSON: A couple of quick questions. There are “Buy America” provisions in this bill. A lot of people think that could set up a trade war, cost American jobs. You want them out?

PRESIDENT OBAMA: I want provisions that are going to be a violation of World Trade Organization agreements or in other ways signal protectionism. I think that would be a mistake right now. That is a potential source of trade wars that we can’t afford at a time when trade is sinking all across the globe.

CHARLES GIBSON: What’s in there now? Do you think that does that? Do you want it out?

PRESIDENT OBAMA: I think we need to make sure that any provisions that are in there are not going to trigger a trade war.

Provisions like these almost always lead to far more negatives than positives.  For example, following the pattern often seen with what is essentially protectionism in the form of a government subsidy (not a “direct subsidy” in the classical sense, but that’s not important), a study showed that these provisions would indeed create roughly 1,000 jobs in the US Steel industry.  This, unfortunately, would be at the cost of as many as 65,000 (read “65 times as many”) jobs in other US industries as a result of increased input costs.

Also of note: the provision is, uh, illegal under WTO rules.  Way to go, guys.

Kudos to Obama for not giving into protectionist pressures coming from Congress.  Forgive them, Barack, they know not what they do.

(Via Marc Ambinder)