Friday, January 2, 2009

Stimulus: Buy American

Obama Team Reviewing ‘Buy American’ Plank in Stimulus (Update1)
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By Edwin Chen

Jan. 2 (Bloomberg) -- President-elect Barack Obama’s advisers are looking at including a “buy American” provision in the economic-stimulus legislation that the incoming administration has made its first priority.

“We are reviewing the buy American proposal and we are committed to a plan that will save or create 3 million jobs, including jobs in manufacturing,” said Jen Psaki, a spokeswoman for Obama’s transition team.

With the U.S. amid its worst economic slump since World War II, Obama is working on a package combining tax cuts and spending on infrastructure, such as roads, bridges and transit systems, to boost growth.

The stimulus package must pass Congress, and Representative Chris Van Hollen, the Maryland Democrat who is a liaison between Congress and Obama’s transition team, said “we obviously want to focus our investments in areas where American industry will benefit.”

Still, Van Hollen, speaking in an interview on Bloomberg Television’s “Political Capital with Al Hunt,” said the aim of the legislation wasn’t to “set up walls” and that the stimulus would be aimed at “generating American jobs,” not triggering a “trade war.”

Obama will meet privately with Democratic congressional leaders on Jan. 5 in the Capitol and will hold discussions later with leaders in both parties, said Brendan Daly, a spokesman for House Speaker Nancy Pelosi. The president-elect and lawmakers will discuss the stimulus measure and other legislation slated to move in the first weeks of the congressional session, Daly said.

Manufacturing Council

Nucor Corp. Chief Executive Officer Dan DiMicco said he will use his position as a member of the U.S. Department of Commerce’s manufacturing council to push for the use of domestically produced steel in such projects. Current requirements that American-made material be used in government projects are unevenly enforced, he said.

The New York Times reported yesterday that U.S. steelmakers are counting on government spending to make up for sagging demand from automakers and other industries.

U.S. steel demand fell to an estimated 104 million metric tons last year from 120.5 million in 2007, said Purchasing magazine, an industry publication.

Democrats are seeking to have legislation ready soon after Obama’s Jan. 20 inauguration, though Senate Republican leader Mitch McConnell has threatened to slow that timetable.

Obama advisers and congressional Democrats estimate the stimulus plan may total $850 billion. Some economists are recommending as much as $1 trillion to spur the economy.

To contact the reporter on this story: Edwin Chen in Washington at

Last Updated: January 2, 2009 18:42 EST

I had commented previously on Will Rahal's blog about how the stimulus needed to have such a Buy American provision.   This is absolutely the right thinking.   America's manufacturing base needs a big lift and this is the smartest way to do it.   Why would you outsource your stimulus?