Emergency Committee For American Trade

ECAT Releases Business Community Letter to Senate Leaders Opposing Buy American Expansions

Calman Cohen, President of the Emergency Committee for American Trade, made the following statement in releasing the attached letter from 100 businesses and associations to the Senate leadership:

“Expansion of America’s Buy American laws will more likely hurt, not help, the economic recovery that we all seek, as it will lead our trading partners to similarly restrict access of American products in their markets. Our businesses and their workers would be paying too heavy a price for limiting the access to our market for the benefit of a few industries. To speed economic recovery, it is critically important that stimulus measures that the United States and its trading partners adopt be structured so as not to be at the expense of each other.”

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February 3, 2009

Dear Leaders Reid and McConnell:

As businesses and associations representing businesses with major U.S. operations and millions of U.S. employees across all major sectors of the economy, we very much share your strong interest in promoting economic recovery for the United States and its workers through an ambitious economic stimulus package that brings the maximum benefit to the U.S. economy, its companies and workers. To do so, we strongly urge the elimination of provisions in S. 336, the American Recovery and Reinvestment Act of 2009 that would expand already robust Buy American provisions in existing laws. If enacted, these provisions will backfire on the United States. They will harm American workers and companies across the entire U.S. economy, undermine U.S. global engagement and result in mirror-image trade restrictions abroad that would put at risk huge amounts of American exports.

Less than three months ago, the United States led the G20 in pledging that stimulus measures would “refrain from raising new barriers to . . . trade in goods and services.” This pledge recognized that the instinct toward economic protectionism is strong in times of crisis, but that the resulting cascade of isolationist measures would only deepen the crisis and impede recovery. By repudiating not only this recent pledge, but also the spirit and letter of the United States’ obligations in the WTO and numerous bilateral and regional trade agreements, the Buy American provisions of S. 336 would send precisely the wrong signal to international markets and to our trading partners, who themselves are in the process of enacting stimulus packages worth many hundreds of billions of dollars.

Enacting expansive new Buy American restrictions would invite our international partners to exclude American goods and services from hundreds of billions of dollars of opportunities in their stimulus packages and perhaps to adopt Buy-Local rules or raise other barriers to American goods more broadly across their economies. The resulting damage to our export markets and the millions of high-paying American jobs they support would be enormous. Given that millions of American workers directly rely upon U.S. global engagement for their jobs, it is vital for the United States to promote, rather than undermine, global commerce.

The new Buy American provisions of S. 336 are as unnecessary as they are harmful. Existing Buy American laws and regulations already require the use of U.S. goods for federal projects except in specifically defined circumstances that are consistent with our obligations under the World Trade Organization and our bilateral and regional trade agreements. For more than 25 years there has been bipartisan support for these agreements and the balance they strike between the protection of American interests and the benefits we receive from commitments that prevent foreign governments from discriminating against American companies and workers in their purchases of goods and services.

The proposed expansion of Buy American-type provisions also ignores the complexity and global nature of the United States manufacturing sector. To compete successfully in the international economy, most major manufacturers in the United States increasingly rely on global production chains that source from the United States and around the world. Many domestic companies producing goods here in the United States will find it difficult, if not impossible, to comply with the stringent American-only requirements of S. 336 because portions of their content are sourced globally. In essence, these proposals seek to impose a 19^th century economic model on a much more modern and international U.S. economy, which will only make the United States, its workers and firms less successful.

Finally, the Buy American provisions of S. 336 contemplate a potential 25-percent increase in the cost of projects at the expense of American taxpayers and with the result of accomplishing substantially less improvement to our national infrastructure. By diminishing competition and efficiency in the contracting process, they would significantly undermine the government’s ability to initiate projects in a timely or cost-effective manner. This means less economic stimulus and a reduction in the enduring benefit that we hope to achieve by investing in vital infrastructure improvements.

For all of these reasons, we urge the Senate to ensure these unnecessary and harmful trade-restrictive provisions are not included in the final stimulus package.

Respectfully,

ABB

The ACE Group of Insurance and Reinsurance Companies

AT&T

Alticor, Inc.

AgustaWestland North America Inc.

Avaya Inc.

BAE Systems, Inc.

BASF Corporation

Boston Scientific Corp.

Case New Holland Inc.

Caterpillar Inc.

Cisco Systems, Inc.

Citibank N.A.

Cummins Inc.

Dassault Falcon Jet

The Dow Chemical Company

Eastman Kodak Company

Forsberg International Logistics, LLC

Fujitsu

General Electric Company

IBM Corporation

Intel Corporation

International Bancshares Corporation

International Bank of Commerce

ITT Corporation

John Deere

Lockheed Martin Corporation

Manitowoc Company Inc.

The McGraw-Hill Companies, Inc.

McKesson Corporation
Michelin North America, Inc.

Microsoft Corporation

NEC Corporation of America

Oracle Corporation

Panasonic Corporation of North America

PCS VacDry USA LLC

Philips Electronics North America

The Procter & Gamble Company

SAP America

Siemens Corporation

TEREX

Texas Instruments Incorporated

Transact Technologies

Trimble Navigation Limited

Unilever United States

United Technologies Corporation

US Trading & Investment Company

Volvo Group North America

XOCECO USA

Xerox Corporation

The Advanced Medical Technology Association

Aerospace Industries Association

American Business Conference

American Chemistry Council

American Council of Engineering Companies

Associated Builders & Contractors

Associated Equipment Distributors

Association of International Automobile Manufacturers, Inc.

Business Roundtable

The Associated General Contractors of America

The Association of Equipment Manufacturers

Brazil-U.S. Business Council

Business Software Alliance

California Chamber of Commerce

Canadian American Business Council

Consuming Industries Trade Action Coalition

The Coalition for Government Procurement

Coalition of Service Industries

Computer & Communications Industry Association

Computing Technology Industry Association

Consumer Electronics Association

Emergency Committee for American Trade

European-American Business Council

Grocery Manufacturers Association

Hong Kong-U.S. Business Council

Information Technology Industry Council

International Wood Product Association

National Association of Foreign-Trade Zones

National Association of Manufacturers

National Defense Industrial Association

National Electronic Distributors Association

National Foreign Trade Council

Ohio Alliance for International Trade

Organization for International Investment

Retail Industry Leaders Association

Securities Industry and Financial Markets Association

Semiconductor Industry Association

Software & Information Industry Association

Technology Association of America (formerly AeA and ITAA)

Technology CEO Council

Telecommunications Industry Association

United States Council for International Business

US-ASEAN Business Council

U.S.-Bahrain Business Council

U.S. Chamber of Commerce

U.S.-India Business Council

U.S.-Korea Business Council

U.S.-Pakistan Business Council

U.S.-UAE Business Council

Washington Council on International Trade

Attached Document(s): 2-3-09 Business Community Opposes Buy American Act Provisions in Stimulus Package.pdf