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'Buy America' clause announced in stumulus package

'Buy America' clause announced in stumulus package

'Buy America' clause announced in stumulus package

(OP)
It's only natural to consider that a stimulus package will emphasize 'Buy America.' Or is that too logical. Anybody objecting to that should be examined carefully for motivations. We are not here for the benefit of China or other questionable sources.

RE: 'Buy America' clause announced in stumulus package

Quote:

Anybody objecting to that should be examined carefully for motivations.

I object! Is sanity a motivation?  Perhaps history?  Rationality?

http://www.investorsinsight.com/blogs/john_mauldins_outside_the_box/archive/2009/01/26/geithner-china-and-the-specter-of-technical-insolvency.aspx

Quote (John Mauldin):

Nothing could be more devastating to the hopes of a recovery. Nothing could more surely turn a recession into a depression, and a global one at that.

RE: 'Buy America' clause announced in stumulus package

I don't normally put links to the pub but I think a lot of the regulars in this forum frequent said establishmnt so: thread1088-236440: Protectionism

In principle it doesn't sound unreasonable to me that an American bill with the express purpose of stimulating the American Economy should enclude provisions to make sure most of that money is spent in America.

It's not an across the board tax on all imports or similar.

That said, I can see how some people might view it as the start of a slippery slope.

Perhaps if instead of phrasing it the way they did, they'd said something like "Any money spent on foreign item purchases shall be subject to 100% off-set of purchases of US items by said foreign entity" it wouldn't have caused the heart burn.  Many (most?) countries require these types of provisions when buying US defence equipment.

KENAT,

Have you reminded yourself of FAQ731-376: Eng-Tips.com Forum Policies recently, or taken a look at posting policies: http://eng-tips.com/market.cfm?

RE: 'Buy America' clause announced in stumulus package

By 'we' I take it you're american (as in North American, US, between Canada and Mexico). The same that decided to move their own manufacturing to China and other lower labour cost countries thus creating an economy dependent on lower cost products? Just think how bad things will get internally when all of a sudden everything starts getting much more expensive and scarce. When the supply lines are suddenly cut. And there will not be ebough labour, therefore driving costs even futher up.
The world has move into an international economy with many interactions of the various countries.
Are you going to buy american oil now? At a preferred price? Are you going to shut borders to countries that have your economy by the 'bills'?
To truly start changing and fixing the economy think of what the U.S. exports (only way to introduce money to the country). Part of it, big part, is financials and weapons. They might need to be regulated. In particular banks.
Many things have to change, and I am not qualified to analyse all (or any for that matter) but do some research on what the economists say (from all over the world) if you're interested. Just keep in mind what history has taught us: The government will take any wrong decision they can think of until the only one left is the right one.

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: 'Buy America' clause announced in stumulus package

Well look at how successful the /decades/ of protection given to the American Steelmaking industry have been.

 

Cheers

Greg Locock

SIG:Please see FAQ731-376: Eng-Tips.com Forum Policies for tips on how to make the best use of Eng-Tips.

RE: 'Buy America' clause announced in stumulus package

"Buy America" provisions have been around for a long time on projects funded by Federal money.  This is nothing new.

Buy America is meticulously easy to meet.  I'm not going to look up the actual requirements at the moment, but essentially something can be 40% foreign content with 51% of final assembly completed in the US and meet "Buy America".  

RE: 'Buy America' clause announced in stumulus package

I'm tired of buying Chinese mops, the only ones available, that only last a week.  This is ludicrous.

Mike McCann
MMC Engineering

RE: 'Buy America' clause announced in stumulus package

Define "American supplier".  Would Nucor,RIMM, General Motors, Toyota, or IBM qualify?  Most large corporations have significant foreign exposure in both manufacturing and sales as well as foreign ownership.  This jingoistic bit of unthought patriotism is REALLY STUPID.  Refer to the statement, " Patriotism is the last refuge of scoundrels".

RE: 'Buy America' clause announced in stumulus package

Is Nucor Steel American or Japanese?

RE: 'Buy America' clause announced in stumulus package

Nucor Yamato has plant in Blytheville, Arkansas with joint ownership with Yamato Steel.  Duferdofin Nucor produces beams in Italy as Nucor Europe.  Are products from either location "American".

RE: 'Buy America' clause announced in stumulus package

My company faced price increases when the steel tariffs were put in during the start of the Bush administration. What happened was that the tariffs applied to all steel products, even those that were no longer produced by U.S. mills. Fortunately, those tariffs have expired. Along the lines of what MintJulep wrote, we have to use U.S made steel for parts we supply for DOD programs. That has been a longstanding policy. But, I am not in favor of adding new restrictions on steel sourcing.

RE: 'Buy America' clause announced in stumulus package

Fine.  You can start with buying American oil.

**********************
"Pumping accounts for 20% of the world's energy used by electric motors and 25-50% of the total electrical energy usage in certain industrial facilities."-DOE statistic (Note: Make that 99% for pipeline companies) http://virtualpipeline.spaces.live.com/

RE: 'Buy America' clause announced in stumulus package

And hoping american oil will be sold at a discount to americans and not at international prices, where the oil companies could make more money.

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: 'Buy America' clause announced in stumulus package

We need a flying pig icon...  

"Good to know you got shoes to wear when you find the floor." - Robert Hunter
 

RE: 'Buy America' clause announced in stumulus package

Hope?  If oil prices go up, just create a depression, spend a lot of trillions and follow it by inflation.  Or precede it by inflation.



Get it?

Oil prices can't even hold their own against milk and chicken soup.  Buy chicken soup and orange juice futures.  They're better bets in the long run.

**********************
"Pumping accounts for 20% of the world's energy used by electric motors and 25-50% of the total electrical energy usage in certain industrial facilities."-DOE statistic (Note: Make that 99% for pipeline companies) http://virtualpipeline.spaces.live.com/

RE: 'Buy America' clause announced in stumulus package

(OP)
The main point in 'Buy America' is to support lcoal industry, thus perpetuating industry and jobs here, where they belong. I take no pleasure in my children buying foreign make cars, when they have the option to buy good American brands.

[My company was destroyed by sourcing engineering plastics from China.]

Even smart people are being blinded into doing business with China. Cessna Aircraft is sourcing their new Light Sport Aircraft fom China! what the hell were they thinking?

RE: 'Buy America' clause announced in stumulus package

So one point I heard an economist or similar make on NPR...

One of the biggest concerns is that other countries would retaliate - which is generally perceived as a bad thing that would diminish trade.

However, what if they 'retaliated' by creating their own 'stimulus packages' with 'buy <insert country here> clauses.

Would that really be so bad?

KENAT,

Have you reminded yourself of FAQ731-376: Eng-Tips.com Forum Policies recently, or taken a look at posting policies: http://eng-tips.com/market.cfm?

RE: 'Buy America' clause announced in stumulus package

plasgears, this is what they were thinking $$$$$$$$$$$$

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: 'Buy America' clause announced in stumulus package

KENAT-

That was the solution that Paul Krugman (won the Nobel Prize in Economics) suggested.

I think that would be the best way to go. Unfortunately, other countries might not react the way we think.

V

RE: 'Buy America' clause announced in stumulus package

Or rather, they will react the way most economists etc. think, which is to impose tariff etc.

After all, why create your own stimulus package when you can slip stream on one from a larger economy?

KENAT,

Have you reminded yourself of FAQ731-376: Eng-Tips.com Forum Policies recently, or taken a look at posting policies: http://eng-tips.com/market.cfm?

RE: 'Buy America' clause announced in stumulus package

It would suck for people who you have already negotiated free trade agreements with, of course...

Since most of our collective North American manufacturing capacity has ALREADY DIED, all this will do is drive up the cost of goods such that less (proportionately) of the stimulus funds can be spent on labour.  It will create artificial scarcities, rather than recreating industries which have already died.  It will also stimulate "smuggling", whether that be virtual smuggling via falsifying certificates of origin, or the actual smuggling of goods.

What the US needs to do- needed to do 10 years ago more properly- was erect trade barriers against Chinese manufactured goods, to compensate for Chinese manipulation of the value of their currency.  Free trade is fine, as long as it's something approximating fair trade.  A country which jerks around the value of its currency is not playing fair at all.  If the rest of us have prolonged trade surpluses, our currency tends to rise to even the playing field.  Not so with China.

They didn't erect those barriers, and won't, even now that it's probably past the point of really being able to help.  For political reasons.  The $1 worth of reciprocal trade had too much political power to ever make tarrifs against the $10 of pure out and out trade surplus being bought INTO the US from China a realistic possibility.

The rest is history.

Erecting trade barriers against Canada and Mexico won't help now, whether you call them "Buy America" or what have you.

RE: 'Buy America' clause announced in stumulus package

I say legalize prostitution and marijuana, and tax the hell out of it.

Then we'll really have free trade.

V

RE: 'Buy America' clause announced in stumulus package

So let me get this straight molten.

If Canada retaliated by creating their own stimulus package with a 'buy Canadian' clause it would suck for Canada?

KENAT,

Have you reminded yourself of FAQ731-376: Eng-Tips.com Forum Policies recently, or taken a look at posting policies: http://eng-tips.com/market.cfm?

RE: 'Buy America' clause announced in stumulus package

As a mexican in Canada, I side with vc66. It might also help lessen other problems! But this will never happen in our lifetimes.

<<A good friend will bail you out of jail, but a true friend
will be sitting beside you saying " Damn that was fun!" - Unknown>>

RE: 'Buy America' clause announced in stumulus package

It would appear that our government is now proposing trade barriers against certain segments of our own community.
 I am classified as a "white skilled worker" and to listen to certain congressmen railing against us having jobs in the bail out, is just too much.
B.E.
http://www.youtube.com/watch?v=opxuUj6vFa4

RE: 'Buy America' clause announced in stumulus package

Yeah, when they were bleating on about funding for 'design of a coast guard ice breaker' I couldn't help thinking, what Engineers don't need jobs too?

KENAT,

Have you reminded yourself of FAQ731-376: Eng-Tips.com Forum Policies recently, or taken a look at posting policies: http://eng-tips.com/market.cfm?

RE: 'Buy America' clause announced in stumulus package

Exactly,
B.E.

RE: 'Buy America' clause announced in stumulus package

I believe that is the one I just posted a few minutes ago.
B.E.
And yes I have seen it.

RE: 'Buy America' clause announced in stumulus package

Didn't see the link.  Great minds...

One more indicator that the new administration is trying to turn the stimulus package into a social engineering tool.

RE: 'Buy America' clause announced in stumulus package

The reason why a world where protectionism is increased, and then each economy applies nationalistic bailouts, is a bad way out of an recession is apparently that trade grows at 4 times the rate of manufacturing, whatever that means.

 

Cheers

Greg Locock

SIG:Please see FAQ731-376: Eng-Tips.com Forum Policies for tips on how to make the best use of Eng-Tips.

RE: 'Buy America' clause announced in stumulus package

Quote:

I take no pleasure in my children buying foreign make cars, when they have the option to buy good American brands.

Maybe it's changed, but when I lived in the USA ('95-'98), none of the   "American brands" produced a car worth buying.  Worse, none of the good cars produced elsewhere in the World were on sale in the USA.  The reasons normally given in the trade rags were "emissions legs".  Basically protectionism dressed up.  "Foreign make" cars that you can buy (Honda, Toyota) are generally made in the USA, employing US citizens, so what's wrong with that?



 

- Steve

RE: 'Buy America' clause announced in stumulus package

If Canada retaliated by imposing our own "buy Canadian" legislation, you can BET the US would be challenging this under the NAFTA.  You can also bet that we won't bother.

Hell, we can't even charge a low stumpage fee on our own Crown land to forestry companies without the Americans crying "subsidy" and putting on countervailing tarrifs against our softwood lumber.  We're apparently expected to charge as much stumpage on our VAST forest resources as private companies charge on tree plantations in Georgia etc.  

It took YEARS of fighting it out in the courts while our forestry industry was being DEVASTATED by the tarrifs, before we came to a settlement- a settlement which had us accepting the PERMANENT loss of these tarrifs- tarrifs which had been declared illegal by successive NAFTA panels...

Canada and the US do a staggering amount of cross-border trade which is of tremendous benefit to BOTH countries.  We are each other's largest trading partners by far- the largest nation to nation trading relationship in the world if I'm not mistaken.  And as a percentage of the total value of the trade we do, the surplus of trade Canada runs with the US is TINY.  There is utterly no comparison with the grand scale on which China is ripping you guys off.  Yet your government would prefer, politically, to go after us DESPITE our free trade treaty.  So it goes, being the mouse sleeping next to the elephant...

Yep, I'm with vc66 too, with a spin.  Canada should forget about any kind of "buy Canadian policy"- we should retaliate by legalizing and taxing drugs and prostitution.  The US "tourist" trade would EXPLODE!  "BC Bud" is already one of our largest exports...perhaps behind something else Americans are addicted to- tarsands oil and natural gas.  These two things are responsible for the BULK of our (legal) trade surplus.

RE: 'Buy America' clause announced in stumulus package

moltenmetal,

You don't think the inflation graph above counts as "jerking around with currency values"?

Did China devalue their currency, or was that currency value, as well as that of the ¥, £, €, NZD, CAD, AUD, gold, copper, lead, fertilizer, oil and every other thing with some inkling of value .. forced up by the relative devaluation of the USD.  If the US Dollar would hold its own, nobody else would have to try to hold the value of their currencies down in order to try to sell their products.

China, in holding their currency value down, and Japan by purchasing billions of dollars every day (artificially holding the value of the $ up against the ¥, only delayed the inevitable for a couple of years.  They now face what  Europe, UK, Canada, Australia and New Zealand, Russia, and those that kept their currencies on the free market, already have experienced for the last 2 or 3 years of declining sales, having immediately fallen victim to  the dollar plunging 50% on the currency market since 2000.

I don't see how you can blame China for trying to build their economy as best they could in the face 100% USD inflation for the last 25 years.   But then again, inflation is the only way that the USD can possibly hope to pay off the massive debts (now at least $38,000 PP soon to go much higher) they have built up now on all the goods, services and oil purchased from foreign sources on credit.

So who is really the one playing games here?

**********************
"Pumping accounts for 20% of the world's energy used by electric motors and 25-50% of the total electrical energy usage in certain industrial facilities."-DOE statistic (Note: Make that 99% for pipeline companies) http://virtualpipeline.spaces.live.com/

RE: 'Buy America' clause announced in stumulus package

Well back to the stumbulus package
This week the republicans asked the democrats the question "You have the votes, why don't you just pass this bill and send it to the president for his signature?"
 In view of the current unpopularity of the bill among a large number of the Dem congress men's constituents it will be interesting to see how this shakes out.
B.E.
u tube video of debate,   http://www.gop.com:80/content/?guid=fe7d2910-3841-49b9-abbc-b0f3103c71c1

RE: 'Buy America' clause announced in stumulus package

It ain't over 'til the bill is on the presidents desk.
B.E.

RE: 'Buy America' clause announced in stumulus package

Americas trading partners have come to the belief that a trade agreement with the US is only respected if it is good for the US.  But you won't see US trade agreement violations reported on CNN.

Bill
--------------------
"Why not the best?"
Jimmy Carter

RE: 'Buy America' clause announced in stumulus package

Well the bill is now on the presidents desk.
 Muscled through by a bunch of politicians who would not even give the American people time to read it.
 Scary Huh,  
B.E.

RE: 'Buy America' clause announced in stumulus package

No different than the previous bail-out bills, or the Patriot Act for that matter.

"Good to know you got shoes to wear when you find the floor." - Robert Hunter
 

RE: 'Buy America' clause announced in stumulus package

A cartoon in today's paper summed it up very well. It depicted a welfare mother in bed with 8 newborn piglets.
B.E.

RE: 'Buy America' clause announced in stumulus package

... did that welfare mother alreay have six young pigs?

- Steve

RE: 'Buy America' clause announced in stumulus package

SomptingGuy (Automotive)

I believe That Welfare mother did.

The cartoonist Depicted this welfare mother as the government and the piglets as the latest Pork packages coming therefrom.
B.E.

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