Thursday, July 23, 2009

"Buy American" is Stupid

Great stuff here from ReasonTV on the "Buy American" provision in the Stimulus* Bill. It perfectly demonstrates just how silly protectionism is in this modern world of global supply chains.

Union-bashing and bikini models... eerily similar to this recurring dream I keep having. Fantastic.

One thing they fail to mention, however, is how much this pointless nonsense has aggravated our trading partners. Canada, China, Australia, the EU, Japan, India, Singapore, Brazil, and even France (shocking, I know!) have retaliated with their own protectionism, or have "expressed serious concern" (trade diplo-talk for being really angry) about Buy American. Perfect timing, too, because the global economy is just humming right along! (Note: economy not humming.)

So to summarize, Buy American is pointless and harmful. A classic congressional two-fer!

One final thought here: When Congress passed the Stimulus*, defenders of Buy American claimed that it wouldn't offend our trading partners because it's perfectly consistent with the United States' obligations under the WTO Agreements and our FTAs. Technically, they were right about the legality - indeed, a Buy American law has been in effect in the US since the 1930s. But the Buy American measure in the Stimulus* has proven to be anything-but-benign because it's given every ill-intentioned hack politician in the world a perfect excuse to push for protectionism in his/her own country.

I mean, when the world's "free trade leader" does it, it's gotta be ok, right?


(H/T Andy Roth at the Club for Growth)

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