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Buy American Issues Surfacing Once Again

James A. Morrissey, Washington Correspondent

As Congress and the Obama administration consider a number of measures designed to create jobs, the issue of Buy American requirements is starting to surface. The U.S. Chamber of Commerce used the first anniversary of the American Recovery and Reinvestment Act to sharply criticize the Buy American provisions in that act and  expressed its "grave concern" over including any such things in future legislation. The Chamber said a number of pending bills contain Buy American language, but they have not yet been acted upon, and "we will continue to vigorously highlight the negative consequences of Buy American."

The Chamber says Buy American provisions are stunting growth, slowing the initiation of projects, causing mass confusion and creating an atmosphere of potential retaliation abroad.

"We must limit the negotiation of any of the Buy American requirements in the Recovery Act, and we must ensure that additional Buy American requirements are not included in future legislation," the Chamber said as part of a study evaluating the results of the Recovery Act.

The Buy American provisions in the Recovery Act were of considerable importance to U.S. textile manufacturers. The so-called Kissell Amendment to the act requires the Transportation Security Administration and the Coast Guard to purchase domestically manufactured uniforms. At the time the Kissell amendment cleared Congress, textile industry officials estimated that for every $100 million spent annually under the amendment, 5,000 jobs in the textile industry will be created or preserved. Textile manufacturers would like to see Buy American extended to other Department of Homeland Security agencies. Another provision in the Recovery Act requires use of U.S. products, including textiles, in highway construction.

In addition, the long-standing Berry Amendment requires Department of Defense procurement officials to buy U.S.-made textile and clothing products, but as the amendment comes up for renewal every year, efforts are made to water it down.

In a report evaluating the overall performance the Recovery Act, the Government Accountability Office said a number of agencies have reported that Buy American provisions have hindered their ability to reach the goals of the Act.

Responding to the Chamber of Commerce report, Alan Tonelson, a research fellow with the U.S. Business and Industrial Council Education Foundation, charged that the chamber is "run by off-shoring multinational corporations who want to remain free to supply U.S. markets from foreign sources even though the trade and broader imbalances that have inevitably resulted helped trigger the ongoing economic and financial crisis."

Retailers and other importers of textiles and clothing were opposed to the Kissell Amendment and are likely to join with the Chamber of Commerce and others to block any further Buy American legislation.

February 23, 2010

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