The new stimulus bill, for example, requires that the money be used for production in the United States. Foreign governments, along with large U.S. multinationals concerned about possible foreign retaliation, charge this favors American-based companies. That's not quite true. Foreign companies are eligible to receive stimulus money for things they make here (as long as the nations where they're headquartered have signed the WTO procurement agreement). [...]I added that emphasis because it's an important distinction. If we buy steel slabs produced in Canada or China, jobs will be created or maintained over there and fewer jobs will be created here, which defeats the whole purpose of the stimulus plan.
I'm not defending the "buy American" provisions of the stimulus bill. I'm just saying they're not the same as "buy from American companies." And although these provisions skate close to protectionism and risk foreign retaliation, at least a case can be made that if American taxpayers are footing the bill in order to create American jobs, the jobs should be created, well, here in America.
Reich also applied this line of reasoning to the auto bailout:
I’m not arguing against an auto bailout. But it ought to be focused on helping American auto workers rather than helping global auto companies headquartered in America. [And he points out that the Big Three themselves are global.] Why pay the Big Three billions of taxpayer dollars to stay afloat when, even after being bailed out, they cut tens of thousands of American jobs, slash wages, and shrink their American operations into small fractions of what they used to be?We're between a rock and a hard place place in this country. I agree with E.J. Dionne's opinion that "there are no good solutions for fixing the auto industry," but I also agree with USW President Leo Gerard who said...
That’s backwards. The auto bailout should help American autoworkers keep their jobs or get new ones that pay almost as well.
Saving the domestic auto industry is crucial to the economic renewal of the U.S. The steel, glass, auto parts, tires, and paper industries produce products for this industry and employ a quarter million of our members alone.Our livelihoods are all interconnected, and as Reich concluded, "Whether it’s stimulus or bailout, policy makers must remember that American companies aren’t the same as American workers – and our first responsibility is to the latter."
Absolutely. That's why spending money from the stimulus bill on products created here is so important. It keeps Americans working, helps restore our economy and may save our domestic auto industry. Isn't that the whole point?