Will Obama Keep His "Buy America" Promise?

by: David Sirota

Fri Jan 30, 2009 at 17:33

( - promoted by Chris Bowers)

NOTE: Excuse the long post, but this is a front-burner issue now, considering the elevation of it to the front page of the Washington Post this week. The issue of trade and globalization - and specifically of basic economic patriotism - was a key issue that won Democrats Congress in 2006 and the presidency in 2008. Now, suddenly and unexpectedly, that issue is front-and-center - and our movement has to take a stand. - D

Back in August, presidential candidate Barack Obama made his commitment to the concept behind "Buy America" legislation very clear in a series of campaign statements and ads lambasting John McCain for opposing such pragmatic laws. Obama even distributed campaign stickers and flyers with a special emblem (at right) declaring his support. It was part of Obama's decidedly progressive and populist campaign platform on trade and economics that many of us (me included) loudly applauded - and it was smart politics and good policy.

As Businessweek reported in its cover story a few weeks back, taxpayers lose a major bang for their buck when our money is allowed to be spent on products and commodities made overseas. Thus, the least we can do is make sure that when taxpayer money is spent, that it gets spent to create jobs here at home. That's basic commonsense that domestic business and labor be able to agree on. It's an issue, in fact, that even many progressive Democrats and Republicans agree on (note that archconservative Republican Rep. Duncan Hunter was a big supporter of "Buy America" laws).

Cut to today. Both the House and Senate, following the campaign promise of Obama, inserted the most basic "Buy America" provisions into their drafts of the economic stimulus package. As the nonpartisan watchdog group Public Citizen reports, these provisions, requiring that U.S. steel and iron be used for federal and state transportation infrastructure projects, "simply extends existing law (the 1982 Buy America Act)" and is therefore explicitly exempt from any corporate-written trade rules that seek to limit such policies.

These provisions are critical, especially because they include language making sure they don't inadvertently undermine taxpayers interests. For example, the president is allowed to waive the Buy America provisions if applying the preference would be "inconsistent with the public interest," if iron and steel are not produced in the United States "in sufficient and reasonably available quantities and of a satisfactory quality," or if inclusion of iron and steel produced in the United States will increase the cost of the overall project by more than 25 percent.

OK - so to review: Obama campaigned on the Buy America concept, Congress followed his lead and legislated them into the stimulus bill but made sure to give him enough flexibility to waive them if they ever endanger taxpayers. So has the Obama administration been cheering and applauding - thanking Congress for helping them fulfill a campaign promise? Um, not exactly.  

David Sirota :: Will Obama Keep His "Buy America" Promise?
Since the provisions passed, business front groups - representing multinational corporations yet fraudulently putting the terms "American" and "U.S." in their names - have launched a major lobbying offensive to gut them. For example, the U.S. Chamber of Commerce and the Emergency Committee for American Trade in Washington are demanding Obama use his leverage to get Congress to eliminate the Buy America provisions.

The groups are getting help from individual companies like Caterpillar and General Electric (not surprisingly, two of the biggest job outsourcers) as well as the usual cast of Washington's corporate-funded think tanks and private equity firms like the Carlyle Group who make the hysterical claim that ensuring American tax dollars are spent in America will somehow initiate a global "trade war." They also throw out the canard that these provisions are somehow like the Smoot-Hawley tariffs that conservatives blame the Great Depression on - somehow omitting that the original Buy American laws were passed in 1933 (well after Smoot-Hawley) and one of the New Deal policies that got us out of the Depression. The screeching has gotten so loud, that for the first time since I can ever remember, the Washington Post (whose editorial board has been one of the most strident voices for free trade fundamentalism in American politics) put a story on page A1 about trade/industrial policy.

But for all the claims of concern about the domestic economy and regular workers, the corporations lobbying against Buy America are acting to defend their own business models that rely on economic policies that effectively incentivize corporations to ship jobs overseas, where they can crush unions, destroy the environment, enslave workers - and therefore lower their bottom line. Buy America laws that reward domestic businesses for staying in this country are a mortal threat to the multinational corporate lobby.

Indeed, what this is about is making sure taxpayer money keeps flowing to corporations that have no loyalty to the United States. Whether its multinational banks getting bailout money or multinational manufacturers getting Export-Import Bank grants to ship jobs overseas, K Street has done a fantastic job of making sure that you and I - the average taxpayer - keeps having to subsidize our own pink slips. And now K Street is making its first campaign of 2009 a campaign to convince Obama to drop his campaign promises and use his power to ensure that our taxpayer money keeps funding our own economic demise - even if it means, as Businessweek suggested, severely weakening the positive effects of the stimulus package.

The Obama administration has responded with a very tepid reaction. Instead of Obama saying, "Damn straight, we're going to make sure stimulus money gets spent in America," the best we've gotten is Vice President Joe Biden telling CNBC, "I don't view [the Buy America provisions] as some of the pure free traders view it, as a harbinger of protectionism." That's at least a start - but from Biden's boss, the president, we haven't even gotten that.

Here's Bloomberg News:

President Barack Obama's administration will examine a "buy American" requirement in economic stimulus legislation that has raised concern among U.S. trading partners, White House press secretary Robert Gibbs said.

The administration "will review that particular provision," Gibbs said today at his regular briefing. The president's advisers understand "all of the concerns that have been heard, not only in this room, but in newspapers produced both up north and down south."

He refused to say whether the administration supported or opposed keeping that part of the legislation intact. Nor did he say what the president would do if the provision remains once the bill clears the House and the Senate.

Forgive me for being not encouraged by this pledge to "review" provisions that Obama campaigned on, but c'mon - this is, well, not encouraging.

Obama's first use of presidential power was a veto threat to make sure taxpayer cash keeps flowing to multinational banks and financial houses. He's negotiating with Republicans over adding new corporate tax cuts to the stimulus bill. Now, as a corporate lobbying campaign ramps up, he's signaling a willingness to "review" the most basic provisions making sure American taxpayer dollars benefit American taxpayers.

At what point will he draw the line? At what point will he answer that historic question that labor always asks: Which side are you on? At what point will he firmly and proudly say "no" to the demands of moneyed interests in Washington? Is it too much to ask him to stand up and publicly defend the most basic, minimal and commonsensical form of economic patriotism that would make sure the stimulus package gets the most bang for the buck?

Democrats just ran a 2006 and 2008 campaign promising to come to Washington to reform our trade and economic policies to make sure they start working for regular people. This fight over Buy America is the beginning of that battle - and if at the very beginning the head of the Democratic Party joins the economic Benedict Arnolds who have sold our country out, it could rip apart the party the same way Bill Clinton tore apart the party with his early push for NAFTA (anyone remember the '94 election?). More important, it could undermine the effectiveness of the stimulus and tell voters Democrats really were never serious about their most minimal economic pledges.

Let me conclude by saying I hold out hope that Obama will make the right decision and support Buy America provisions - and we should withhold our judgment until the president makes his judgment. But the fact that there's even a hesitation once again reiterates what I said in my newspaper column today. Like FDR in the 1930s, we may today have president who says he agrees with us, but passing even the most minimal policies like Buy America will require us to make him do it.

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You deserve credit for keeping his feet to the fire. n/t (4.00 / 5)

i'd support this if you'd support opening the borders completely (0.00 / 0)
with no restrictions.


I support (4.00 / 4)
I support seriously increasing legal immigration in this country, and am deeply opposed to the right-wing proposals for border walls and rounding up undocumented workers. I'm not for "open borders" in the sense that I think there needs to be a legal process for immigrating to this country - but I think the current process we have is unacceptable and needs to be liberalized. I am the grandson of immigrants. We are a nation of immigrants. And our openness is what makes us strong.

[ Parent ]
we are a country of legal immigrants (4.00 / 3)
which were used to water down labor costs.

now were becoming a country of illegal immigrants which are used to water down labor costs.

and if you don't think so, just go and try to get some light construction work. enjoy $4/hr.

~* the * Will * to go on *~

[ Parent ]
i worry that the construction stimulus $$ will all go (4.00 / 2)
to contractors like that -- without requiring the employees to be legal, or requiring anything.

[ Parent ]
how about instead of requiring the employees to be "legal." (4.00 / 4)
you just make unionbusting illegal.  What happened to building coalitions with the disempowered?  Is that not progressive anymore or something?

[ Parent ]
of course, but i mean no living wages or benefits or even (0.00 / 0)
existing labor laws and regulations -- like using citizens and green card holders, etc -- let alone union employees. (like what was done with Katrina contractors/contracts/$$, and others too)

it's a given that there won't be any language about unions in this stimulus at all, sadly. (Obama will probably not even push EFCA ever, i'm betting)

[ Parent ]
so given that the leadership is failing unions, not to mention all working people (4.00 / 1)
wouldn't those of us who are interested in progressive values be better off focusing on what would best promote labor organizing?  It's a great solution for American capitalists to help sustain the manufacturing sector in the U.S. through a buy-america job, but ultimately, we need to be organizing workers (especially low wage, working class, and middle class) and other kinds of poor people wherever they are - whether they work in car factories or whether they work in garment factories or whether they pick fruit in fields.  Some of these people are citizens, some are not - but the point is they have a lot more in common with each other than they do with the companies that are going to be benefit most from the bailout.

I haven't done the math, but I'm curious what would have happened if you gave the $750 billion or however much it was that was initally allocated for the bailout directly to working people in the United States.  Not only does this make economic sense (you have a lack of demand in the U.S. - that's what causes recession - you can make up for it by government spending or by giving people more money to spend or both - some people have also argued it's the long term problem - that the declining or stagnant real wages have left insufficent demand for an overcapacity of produced goods and services).

As relevantly, it also fits better with our values.  Why should we allow corporations and Lou Dobbs or the mainstream media to divide people on "legal" "illegal" "Black" "White" "man" "woman" "straight" "gay" "citizen" "noncitizen" "American" "other" when we have more in common with each other than we do with them?

Finally, if I'm right about all or most or even any of it, why does it not get discussed in mainstream politics.  That is my question.  It's not like it's that radical on economic grounds - it' sactually a way to make sure that capitalism can keep going - it just happens to focus on making sure that the people who sustain the system through work and buying things are able to keep doing so.

[ Parent ]
What's wrong with being legal???? (0.00 / 0)
Sort of like pot...  Everybody does it under threat..  Legal immigration is what this country is built on, and it should continue.  

Your insinuation that somehow protecting this country and the people in it is racist or unamerican is bull shit.  

[ Parent ]
it's not that people who support this point of view are racist (0.00 / 0)
i'm saying the idea that an American citizen is worth more than a Canadian citizen or someone from El Salvador or someone from Greece or China is one of the newer things they're using to divide poor people.  What does "protecting America" mean if you're a working class or middle class person in the United States?  In practice, it means siding with American businesses and the American elite over the people who are at the same level or below in other countries.  

That these national boundaries are the product of a history of racism, imperialism, etc. and current massive inequality is what makes it really f@#ked up.  Can you imagine what people would say if they required work permits for people from Mississippi to work in New York or Chicago and if they didn't have them, they were told they were "illegal" and were put in jail and then sent back to Misssissippi to languish in poverty?

[ Parent ]
you can replace some terms here too (4.00 / 3)
for example, replace "legal immigrants" with "people who can easily be unionized" and "illegal immigrants" with "people who are directly or indirectly stopped from  being unionized" - then you can throw in all the people in "right to work" states both citizens and not, anyone who works at Wal-mart, etc.  That's the problem - that the policies and laws make it really hard to organize people - not strictly whether someone is documented or not.  That whole divide ("legal"/"illegal") is just more rightwing divide and conquer tactics like "the gays are trying to destroy families" and "Obama is a secret terrorist/Muslim/socialist."

[ Parent ]
if you're not for open borders (4.00 / 1)
how do you justify, from a progressive vantage point, advocating for measures for economic growth for one of the richest economies in an extremely unequal world?  Is nationality the last acceptable prejudice among prominent progressives?  If you were a factory worker who had lost his/her job, I  would understand better where you're coming from, but you're not.

Opposing border walls and mass deportations is just basic decency / pragmatism - it's like being against Bush or Tancredo, not a progressive policy.  A minimum practical position for progressives today would be citizenship immediately for everyone in the United States now, clearing the backlog, and a rolling registry, as well as a ban on politically oriented deportations and detentions - but even that just maintains the privileges that come with U.S. citizenship, leaving out the 3-4 billion people that personally or through ancestry have u.s. policy favoring them.  i am one of the people who did,  and i think we owe it to them.  "open borders" and "a legal process" are not mutually exclusive terms if you can accept that an American life is worth no more and no less than the life os someone outside - i.e. they're all precious.

[ Parent ]
it's our govt's role tho, to work and act for us -- not for people in other countries -- (0.00 / 0)
we vote and pay taxes here -- and our government is wholly required and empowered -- by us to act for us.

that's already not being done for the most part -- and we've been suffering terribly for ages as a result.

Our own house must be put in order (and it's not being done) first and foremost. And one of the big reasons why is because we can't go elsewhere, nor should we have to -- especially when the world still wants to come here.  

(We're not like Poland, for instance, who saw all their young, educated, and driven people leave for work in other countries like the UK and France -- and are now going back home bec things have become lousy where they went.)

[ Parent ]
interesting use of "we" (4.00 / 2)
1. Undocumented migrants to the U.S. and other people who are not citizens pay billions in taxes each year, but don't receive the same benefits (for example, undocumented people pay billions into Social Security but aren't eligible for benefits.)

DMI's immigration report "Principles for an Immigration Policy to Strengthen and Expand the American Middle Class" shows that "the average immigrant pays $1,800 more in taxes than she receives in government benefits -- a lifetime tax contribution of $80,000 more than she and her immediate descendents receive in benefits. Undocumented immigrants alone are estimated to have contributed nearly $50 billion in federal taxes between 1996 and 2003. Immigrant tax contributions finance vital middle-class goods like public schools and Social Security."

So what justifies that?

2. For over a century, women and Black people were legally prevented from voting.  Do you think that this was okay and that they should have had no right to speak and lend input?

3. I agree with this:

Our own house must be put in order (and it's not being done) first and foremost.

Mainly for practical reasons.  In the long run, however, what I  am saying is part of putting our own house in order, recognizing that American citizens are no better and no worse than any other people by nature.  The American government, on the other hand, has done enormous destruction to people all over the world (whether directly or through actions like funding and then attacking the Taliban) in order to establish and maintain the system that exists here, just as it did to slaves and to women (among many others, like Irish and Chinese migrants). Here is a list from ONLY Latin America from the years 1894 to 1918 ALONE:

5. US Occupation of Bluefields, Nicaragua (1894)  
6. US Occupation of Corinto, Nicaragua (1896)  
7. US Occupation of Juan del Sur, Nicaragua (1898)  
8. US Occupation of Bluefields Nicaragua (1899)  
9. Yaqui Indian War in Mexico (1899-1904)  
10. US Intervention in Panamanian Revolution (1901-1914)  
11. US Intervention in Honduran Revolution (1903)  
12. US Intervention in Dominican Republic Revolution (1903-1904)  
13. US Intervention in support of Cuban Elections (1906-1909)  
14. Dollar Diplomacy Protectorate established in Nicaragua by US (1907)  
15. US Intervention in Honduras in support of Operations against Nicaragua (1907)  
16. US Intervention in Panamanian Elections (1908)  
17. US Occupation of Bluefields and Corinto, Nicaragua (1910)  
18. US Intervention in Honduran Civil War (1911)  
19. US Intervention in Cuban Civil War (1912)  
20. US Intervention in Panamanian Elections (1912)  
21. US Intervention to protect economic interests in Honduras (1912)  
22. US Occupation of Nicaragua - Counterinsurgency (1912-1933)  
23. US Intervention in Mexican Revolution (1913)  
24. US Intervention in Dominican Republic (1914)  
25. US Occupation of Vera Cruz, Mexico (1914)  
26. US Intervention against Mexican nationalists (1914-1918)

You can see the entirety of the list here (it's a pdf on a marine corps site).

However, given that the U.S. has some elements of representation and legal freedom, it turns out that the media, and many other people have to different degrees aided by continuing to argue that an American life is worth more than a non-American life (whether a noncitzen in the United States or an Iraqi civilian or a Palestinian person or an Indian poor person).  This is no better and no worse than racism, sexism, homophobia, or anything else that tells us that one person is worth more than another.  Moreover, it is not good for Americans or for people who can't vote in the United States.  So really the choice is whether you want to be one of those people who make things worse or one of the people who make things better (which is why I say it's not possible to be a progressive withotu accepting that international disparities of power are not okay).

[ Parent ]
strawman argument... (0.00 / 0)
Who the hell is talking about immigration besides you?  once people are in this country legally, they should be a part of it to the full extent of the law.  

People who make your ridiculous argument need to be broke and in America.  Tell Americans that are unemployed, homeless and without insurance that they and their American children aren't worth as much as someone in another country.  

[ Parent ]
it's not a strawman argument (4.00 / 1)
i was responding directly to the comment above - that people who pay for and vote are the ones who should be entiteld to the economic and social benefits of American society and laws.  My argument was that even in a narrow sense by that standard, there should be an immediate amnesty (not a path to citizenship) for everyone in the United States because in fact noncitizens are paying an enormous amount of money  into the system and not getting as much out of it.  In a broader sense, the reason that people in the United States have access to more resources is because the United States government and corporations have engaged in a lot of military and political imperialism or benefited from other peoples' AND that workers in the United States, in the long run, if they care about ordinary people's welfare including hteir own, are better off trying to forge alliances with workers in other countries than with the people who are exploiting them.

Tell Americans that are unemployed, homeless and without insurance that they and their American children aren't worth as much as someone in another country.

Of course they are.  They're worth as much as any other person.  And they should have health care, just like people i n other countries should.  And they should have enough food, and clean water, and a clean environment.   They should not have the right to think they are worth MORE than a citizen of another country (or a stateless person).   That's a big part of why I'm talking about immigration and the rest of the world.  I believe in democracy and equality.

[ Parent ]
that is ridiculous (4.00 / 1)
oh, if you are not for something that defies all labor economics, statistics and will be an absolute disaster for all workers oh, then you are not Progressive?

uh huh.  I think I'll go with reality instead of having someone trying to co-opt what Progressive means to demand pure labor economic fiction.

The emperor has no cloths and your rhetoric has no basis in labor economics, theoretical or applied.


The Economic Populist

[ Parent ]
just to let you know (4.00 / 1)
i will be ignoring every ad hominem attack you make on me because you accuse me of things like "he makes things up" and then don't actually explain what you mean.  This is probably because it's not true and you're acting out of some kind of misplaced fear or anger towards me on whatever grounds.

What's more of a problem is that you also keep thinking that you're the only kind of populist around - as if it's not possible to be populist and not have your views.  I think you're more Lou Dobbsy than Paul Rosenberg-y in your views on democracy.

Anyway, you're welcome to respond, but don't expect a reply.  I'm telling you this as a courtesy in the hopes that you'll think about why you say the things you say to me and what it means about both of us.

[ Parent ]
sorry - i should have said "ad hominem" - there was a substantive argument (4.00 / 1)
Here is the economic analysis:

A fractured labor market has less bargaining power with employers, who do operate as a class in many respects (or have anyway).  The global labor market is fractured into nation states and along ethnic, racial, citizenship,migrant or nonmigrant status and other lines within countries.  As a result, every rich country group like the one you're a part of has less power, and ever poor country group has none.  creating a global labor pool (albeit a segmented one in practice) would give labor and its organizations a monopoly as sellers of labor or at least an oligopoly which in pure power terms would allow them to negotiate better terms with employers and more broadly with the corporate class, both within countries (as long as they exist) and within an economy that has been increasingly globalized.

I think this debate is important because it speaks to whether that trend should be reversed FOR PROGRESSIVE ENDS not just for narrow interests.  As a result, Palestinian labourers in Lebanon and unodcumented workers in New York and migarnt workers from South Asia to the Gulf seem to have the same occupations (domestic workers, construction, etc.)

How's that?  I can contextualize it in terms of contemporary political terms if you want but I haven't htough tthat part through.


[ Parent ]
Boxer's been pushing something about overseas assets -- (0.00 / 0)
does anyone know more about it? is it part of the package?

is it just more tax breaks for corporations?

here it is -- "tax cut for foreign corporate earnings" (4.00 / 1)
http://www.bloggingstocks.com/... -- Stimulus plan's tax cut for foreign corporate earnings could inject $545 billion into U.S. economy


... The bill has bipartisan sponsorship from the influential U.S. Sen. Barbara Boxer, D-California, on the left, and U.S. Sen. John Ensign, R-Nevada, on the right. Supporters say the tax reduction will encourage corporations to expand operations and save jobs: economist Allen Sinai of Decision Economics is one who agrees.

Sinai argues the tax cut would serve as a private sector-funded stimulus plan and inject more than $545 billion into the U.S. economy without increasing the budget deficit, The Wall Street Journal reported. (Subscription required.)

Burdensome U.S. tax policy

Under current tax laws, U.S. corporations are charged 35 cents for every foreign dollar earned that they bring back to the United States. However, in many instances, foreign nations tax this income at a considerably lower rate, which encourages companies to keep that money outside the U.S. Economist Peter Dawson said a lower U.S. tax rate for repatriated earnings would bring money back to the U.S. the way pollen attracts honey bees.


[ Parent ]
Sirota, even worse, all IT jobs, 1 million, no provisions for US workers/companies! (4.00 / 5)
David, I really think you will get warm fuzzy from all STEM, IT workers in the US if you cover this one.  I just found it today.

Obama Stimulus Plan Funds Offshore Outsourcing! Technical Jobs for Americans Denied!:

   Congressional Democrats stripped from President Barack Obama's economic stimulus plan a local lawmaker's bid to assure that American high-tech companies would get jobs funded by that plan.

   U.S. Rep. Tim Murphy, R-Upper St. Clair, said his amendment would have required that any health information technology system bought under a $20 billion grant program in the stimulus package be manufactured in the United States by American workers.

Now supposedly Democrats are interested in using our tax dollars to create jobs for Americans in America...

well, by stripping this out, Democrats basically created 1 million jobs with our taxpayer dollars....for the NASSCOM Offshore outsourcing Industry!

NASSCOM dominates at this point all IT in health care as well as many other places.  We have all of these offshore outsourcing companies now salivating at getting this money.

A H-1B or L-1 guest worker is simply not creating a job for a U.S. Citizen, perm resident (i.e. an American) and this one is so bad, they refuse to even use US corporations!

If there is any occupational area that has been positively decimated by offshore outsourcing, insourcing, global wage arbitrage....it is IT, Science, Technology, Mathematics and Engineering.

So, this is just beyond the pale that they would not require those jobs go to American workers....

It's public money!

(if you cannot tell how absolutely pissed I am, well, please help STEM, technical professionals for of all occupations that are the most in need of labor representation and the least equipped, the seemingly ignored by Congress, almost impossible to get any support from D.C.)  

This is 1/4th of the projected jobs....going offshore.  I can guarantee it....the health care industry fired Americans in masse in 2000 and offshore outsourced their IT departments (in addition to others).  


The Economic Populist

is there any wording in the stimulus to require that all jobs be here? (4.00 / 3)
i bet not even that is in there.

and on the healthcare it $$ -- if there's no strict privacy regulationsin there, it's just another giant windfall for the companies in datamining and selling our info -- and using it to deny care too.

[ Parent ]
None that I am aware of (4.00 / 1)
I have two analysis posts on the Stimulus but since the Senate is ripping it apart plus after that it will go to the infamous "conferees" who probably will change it once again, I took a break on analyzing it.

Obviously that was a mistake and I will try to write soon any amendment, any provision etc. I can find.

In the interim, our friendly neighborhood Senators who might consider fighting for U.S. workers and putting in those provisions might be:

Bernie Sanders
Byron Dorgan
Jon Tester
Claire McCaskill
Jim Webb

and on this one, maybe Dick Durbin.  

There are probably others and you should call whoever your Senator is....but the ones that come up to the plate with actual legislation and amendments on Sanders and Dorgan.


The Economic Populist

[ Parent ]
$20 Billion to modernize health care records (4.00 / 1)
I have a partial list of projects here.

I'm trying to find out the actual percentage of offshore outsourced jobs for IT for the health care industry, but for now I would stand out on a limb and say 80% or greater.

They also use, extensively, guest workers when they cannot offshore outsource the job.  

So, this implies to me at least $20B will fly right out the door (and didn't Google already do this anyway)?

I have to go through and identify all jobs that are probable to use offshore outsourcing or body shops (these are companies that exclusively deal with H-1B/L-1 guest workers operating in the U.S., but are not U.S. companies) etc.  to see just how badly, how big of a chuck of US taxpayer money we're looking at to help the India, China, Brazil, etc. economies.  

Just glancing over at the "universities" money, R&D...well, little is it known universities can hire an unlimited number of H-1B Visa holders as well as nonprofits...
and the assuredly are labor arbitraging US researchers, at the Post Doc, PhD level and others...

but this gets more complex because advanced research due to the area of expertise is different than say data entry into a database.  

I'd say at least another $10B guaranteed to not go to U.S. workers is probably in there.

These are really rough numbers I have to look at all of this in more detail.


The Economic Populist

[ Parent ]
thanks! (4.00 / 1)
keep us all informed -- it's so vital, and so not discussed for the most part.

[ Parent ]
Google Provides A Personal Health Record (0.00 / 0)
this is a patient self entered tool.  It is a nice thing to have (I use one) but it is not a clinical tool.  Obama wants to automate doctors offices and hospitals with Electronic Medical Records something the Google tool doesn't go near.  I work on this stuff for my job and what Obama wants to do is absolutely right and necessary.  Now I do agree it should be done through American companies and workers.

One other thing -  your 80% number seems completely off based on my experience buying health care software for my job.  There is now doubt some offshoring but I'd be shocked if it is anywhere close to 50%.  

[ Parent ]
I agree with you (0.00 / 0)
this is a major project that is one of those multi-forked results.   I have over on EP the CBO estimates on the total health care costs reduction.  

Thanks for the info, I thought Google was father along..

on the percentage on offshore outsourced health care industry I do not know the real number.  That's just an estimate and I'm also going off of a 2006 GAO report on the contracts, which in turn use subcontracts with Medicaid/Medicare.

I also count in guest worker Visas because they are simply cheaper labor, used by these offshore outsourcing companies and do not have any advanced skills that cannot be found in U.S. workers.  (H-1B is known as the offshore outsourcing Visas).

But do not take my sticking my thumb in the air and guessing fact.  I'm going to try to find some real estimates of just how much of this stimulus money has the high probability of going offshore, not using U.S. citizens, perms, using guest workers, etc.

I hope some major think tank takes a look, it's really important considering what is going on in the economy.

(EP = The Economic Populist which is an economics community blog where I write).  


The Economic Populist

[ Parent ]
Purpose (4.00 / 4)
The purpose of the stimulus package, the only purpose of the stimulus package, is to create jobs in the United States.  How does buying things from China, India, Mexico, Canada, Bangladesh or wherever create jobs in the US?  The Republicans are already complaining that we are spending too much money to create jobs.  Well, they have Obama stopping some easy job creating parts of the bill.  Putting sod on the National Mall?  Those are jobs placing it down.  Jobs watering it.  Jobs growing the grass.

[ Parent ]
I hear ya (0.00 / 0)
I think I just gave myself high blood pressure when I read this.


The Economic Populist

[ Parent ]
Not much I can add (4.00 / 2)
I think you pretty much covered it. And "Buy American" should be closely accompanied by "Hire American."

In response to the "open border" issue upthread, I'm sorry, you folks can call me whatever you like, but I am not a fan of open borders, nor of casually blowing off the presence of illegals in the US. While I'm not in any way, shape or form in favor of anything as Draconian as a wall or fence, I do strongly believe we have immigration laws for a reason and if they are not adhered to, those that break the law must leave, with few exceptions.  

the reason you have strong immigration laws (4.00 / 1)
is that the corporations annd corporate-controlled government want to have a pool of cheap labor and moreover that they want to be able to control the ebbs and flows according to low wage economic needs (Read - ways to keep wages down).  

it's also why you have workfare instead of welfare and why the economic aspects of sexism exist (for example, when abortion or RU486 is criminalized or made harder to obtain who suffers most - the rich person who can fly to another state and obtain a medical procedure, or the person in a small town with only a walmart?  The class dimension of this issue is too often ignored.)  

Anyway, the "illegal" "legal" thing is par for the course in this sense and it doesn't work to keep harping on it.  The question is what you do about this - in your organizing, in your thinking, in your strategies, do you place yourself with the people who are in the same position as you - whether they are people UFW is trying to recruit or whether they are peopel SEIU is trying to recruit or whether they are people whose jobs UAW is trying to save - or do you spend your time arguing with Congresspeople and think of yourself in a category above some of the other people (whether undocumented or black or women or whatever else)?  It's about solidarity - which is the core of any workers movement.

[ Parent ]
Oh, like that's unique and somehow prejudicial? (4.00 / 1)
Why do you think they forced welfare reform and pushed these people in to the labor force?  When they were done with Rosie the riveter, where the hell did they push her?   There isn't anything that happens in this country that doesn't involve "follow the money".  That's why it is called the private, "for-profit" sector.  

[ Parent ]
what's unique is that (0.00 / 0)
no one would say "it's okay to keep black people out of the labor force" or "it's okay to keep women out of the labor force" but because someone isn't an American citizen or isn't documented or doesn't live int eh United States, it's somehow okay to say they should be kept out of the labor force.

The history of how the country accumulated its wealth and roles that racism, colonialism, other countries' colonialism, etc. played in it are also worth taking into account as to why the United States has more higher income jobs than Bangladesh or Pakistan or Indonesia.

That's all - just that solidarity is more important to me than reinforcing the idea that people, by virtue of their citizenship status, are entiteld to more rights in the world.

[ Parent ]
You're beautiful, more beautiful than me (0.00 / 0)
Loyal to the Bank of America...

GM, Brazil, Obama is doing nothing (0.00 / 0)
any questions?

Yeah, while I certainly don't support GM & Brazil (0.00 / 0)
that would be an easy fix with Buy American legislation.  What I also don't support is that auto ceos had to take a salary of $1.00 a year while the WS banks are paying out millions in salaries PLUS bonuses.  

Obama and the Democrats are just too establishment and status quot.  However, they will either deliver the change they promised or they will lose to it.   We, on the other hand, will lose no matter what.  

[ Parent ]
You make all this so very simple (4.00 / 1)
David, there aren't many times when I have a real bone to pick with you, but this is one of them and it's not because I disagree with any of what you're saying from a philosophical standpoint. I agree with you on the political philosophy level. But please realize this issue can't be dealt with in terms of the simplicities of economic nationalism.

Globalization isn't just a business tendency or a political deal. It's written in law. IMF, World Bank, WTO, NAFTA and so on. There are real legal issues here that have to be dealt with. Simply touting "Buy America" doesn't get us there. There has to be a coordinated legal/political/economic effort made to deal with all the various bullshit treaties that will at least try to avoid trade wars or worse. It's really that serious.

The whole Smoot Hawley point is partially valid and partially invalid. Back in the 30s, we were the world's creditors. Now we're the world's debtors, so I would hope people would put aside S-H as something of a valid argument for anything. The circumstances have changed a great deal. We're now on the opposite side of that play, which shouldn't be understated.

Buy America isn't something we can just boil down to bumper sticker politics. The possibility of trade war is something to keep in mind. That's no reason to abandon the notion of redeveloping our own domestic markets, since that is precisely what's needed. The Chinese also were way too late in thinking about their own domestic markets and we can thumb through a couple dozen other economies where the same applies.

So while I agree with you on that most basic of levels, for progressives to mount a campaign that will result in trade wars (which will likely lead to some hot wars) without considering all this first is just insane. This issue can't be boiled down the way you're doing just now.

To my mind, this is a perfect opportunity for American progressives to present solutions to much of the rest of the world economy. But we can't just sit around thinking Buy American as if that's going to solve the larger problem. It won't and if we all fall into that mentality, we can look forward to a lot of Beggar Thy Neighbor problems down the road. (Yes, there is some validity to that argument, like it or not)

Trade wars can become hot wars all too easily in the midst of a global depression. Yes, we're on the edge of that abyss, so please refrain from going all nationalistic on the economy, ok? It's not the Progressive Way!

It seems to me the progressive response should be, "Look, there are solutions we can all live with here, but we all have to make more effort to take care of our own, rather than selling them all out to multi-national corporations."

"Once we've created better internal markets, we can trade more with each other and if we have to help each other out in developing our internal markets on the basis of fair trade principles," and so on.

A Progressive Shock Doctrine, if you will.

Progressives have to deal with the legal/political framework that is the WTO. It's no small task. But it's real and it has to be dealt with in real terms. This will require a larger political argument and strategy.

This is an opportunity. Please stop playing The Man's Game and expand your thinking to include the macro (BIG) picture. Think forward a few steps, instead of just reacting to things.

"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates

"Hire American" is better, i think -- (0.00 / 0)
after all, that's the stated goal of this entirely.

If it's meant to create millions of jobs here, it damn sure better have language requiring that all jobs be here, no?

It's not a trade issue at all, really, nor does it have to be.

(altho --it'll help trade overall because we'll actually be rebuilding and/or creating industries whose products can be exported, no? the "green energy" parts especially)

[ Parent ]
"Hire American" doesn't mean "hire in the United States" (0.00 / 0)
it means "Hire American citizens" (or whatever your interpretation of American is...which can range into the xenophobic or the racist or any number of other things that employers can use to turn down employees.

In certain places, it makes sense to hire people - but why not "Hire from Michigan" in Michigan to help stave off the effects of the collapse of the auto industry?  That makes more  sense to me and seems less upsetting and problematic.  UNITE did something similar after 9-11 that was a "buy New York" label.

[ Parent ]
where is it written (4.00 / 1)
that government expenditures, this is public money, U.S. taxpayer money, public expenditures, not private sector at all....magically come under the purview of the WTO?  

They do not.  the GPA is still a sad, pathetic document as is much of the WTO agreement but most of the projects do NOT come under the WTO already and hence, adding an additional provision to use U.S. citizens/perm residents should not be an issue.

Assuredly the WTO has not (yet) conquered national immigration policy, try as they might (India esp.) to add to that via WTO GATS mode 4.  

So that also implies there is absolutely no reason to offshore outsource jobs, projects and have a valid complaint.  We're sorry but something as sensitive as personal data and the national security involved in something as crtical as medical records is simply too much of a national security issue to be offshore outsourced.

Matter of fact, all IT infrastructure is a national security issue with the emerging cyberthreats and sabotage...therefore, we are sorry but it requires U.S. citizenship and a security clearance.

Sorry, end of story.  

On top of it you have other countries do the same thing, using government expenditures to stimulate their own domestic economy....which is not the private sector at all here.

So, the only possible problem is over Steel.  and this absurd threat of a trade war when most peoples in most countries want sane, fair trade is pretty far fetched and sounds U.S. Chamber of Commerce corporate lobbyist generated.

and the idea some trade organization gets to dictate to any country how they choose to enhance something as critical as Steel is to U.S. national security...well, I have one word for them:  Airbus.

You know we're looking at a possible depression if wage repression/deflation continues.  and people are all up in arms on a trade war....as if that had any major effect whatsoever in the Great Depression?  (uh, no, it did not! not in the United States).    


The Economic Populist

[ Parent ]
Then abrogate the treaties; (4.00 / 1)
we have been killed by exposure to the global labor market.

By the way, I'm not interested in "making the total pie bigger", I care about the American middle and lower classes ONLY. As long as their share increases I don't care what happens else where. The rich can hang; huddled masses in other countries can handle their own governments

I'm for a trade war, in other words, where our elites really take it on the chin for what they have done to us over the last 30+ years.

I'll also accept a lower standard of living in exchange for retribution.

Our system requires checks-and-balances, and right now there is no check on elite hubris.

[ Parent ]
Trade War (0.00 / 0)
Could you please detail for me what a "Trade War" is?  

[ Parent ]
Thank you David (0.00 / 0)
I am hoping the AFL-CIO, EPI, global labor experts pick on this and give estimates on how much of US taxpayer money is going offshore/guest workers vs. how much would actually go to U.S. companies/jobs in the U.S. for U.S. citizens (perm res.).  


The Economic Populist

bailout $$ too -- Tata got a $2.5 billion 9-year contract w/Citigroup in Oct. -- (4.00 / 1)
10/08 -- India's Tata Wins Big Citi Outsourcing Deal -- http://www.businessweek.com/gl...

It's festival time in India, and Tata Consultancy Services, the country's largest IT software and services provider, is celebrating with gusto. After months of speculation, TCS acquired Citigroup's (C) India-based outsourcing unit, Citigroup Global Services, for $505 million in an all-cash deal announced on Oct. 8. That's the largest-ever purchase for TCS. What's more, the company bagged a $2.5 billion contract to provide process outsourcing services, application development, and infrastructure support to Citigroup and its affiliates over nine-and-a-half years. ...

[ Parent ]
"Citigroup's guarantee package, completed Jan. 16, totals $301 billion" (4.00 / 1)
-- http://www.bloomberg.com/apps/...

-- Obama Records Pledge Tested By Citigroup Guarantees

... Citigroup's guarantee package, completed Jan. 16, totals $301 billion. It kicks in after the bank goes through its $9.5 billion in current loan loss reserves and the first $29 billion of losses. The government also gets $1 billion of the bank's benefit from hedging contracts. The Treasury, the Federal Deposit Insurance Corp. and the Fed then assume 90 percent of losses from those assets.

Citigroup's guarantees include $191 billion of consumer loans, with $55.2 billion of them second mortgages, according to a Jan. 16 news release from the bank. Securities backed by commercial real estate total $12.4 billion and corporate loans add $13.4 billion.

Citigroup has received $45 billion in cash from selling preferred securities to the government under the Troubled Asset Relief Program.  ...

[ Parent ]
would be nice wouldn't it (4.00 / 1)
While the $50 million dollar corporate jet made even the President say "shame on you" ....when we see $2 billion + offshore outsourcing contracts while Citigroup lays off 50,000 employees no one blinks an eye.


The Economic Populist

[ Parent ]
related too -- how all Fed Contracting "squanders tens of billions" a year -- (4.00 / 1)
Bloomberg -- Hidden Bonuses Enrich U.S. Government Contractors -- http://www.bloomberg.com/apps/...

...As the federal government's $700 billion bailout of banks sputters, there's an object lesson for the new administration of President Barack Obama: Federal departments, including Treasury itself, routinely squander tens of billions of dollars a year in taxpayer money as they farm out public business to private corporations.

Obama, like presidents before him, said during his bid for the White House that he wanted to curtail waste in government. With contracting, he faces a mismanaged system that accounts for almost 40 cents of every federal dollar spent outside of mandatory obligations such as Social Security and Medicare.

Not Earmarks

When compared with all federal contracting, just a fraction of U.S. spending waste comes from so-called earmarks, which elected officials often criticize as the unnecessary pet projects of politicians.

The "Bridge to Nowhere" in Alaska, for example, had a price tag of $398 million. By contrast, the government spent $368.4 billion on all contracts in 2008, and Republican Oklahoma Senator Tom Coburn estimates that about $100 billion of that was wasted.

U.S. spending on 3.7 million contracts in 2008 represented an increase of 76 percent over 2000 levels.

"We have a broken, broken system that rewards incompetence," says Coburn, 60, who has been examining purchasing breakdowns since his election to Congress in 2005. "We need to totally change contracting."

Bureaucrats, not elected officials, run the U.S. purchasing system, well out of public sight. And their bosses keep the spending secret by not releasing complete contract files to the public.

No Access

Just as taxpayers can't find out how the Treasury and the Federal Reserve used the first half of the bank bailout, Americans are often denied access to public records that provide details on how hundreds of billions of taxpayer dollars are spent in contracts.  ...

10 of the 13 CEOs Obama met with were Tech -- (4.00 / 1)
WSJ -- Tech Industry CEOs Back Obama's Rescue Package -- http://online.wsj.com/article/...

... President Barack Obama won a well-timed plug for his economic-rescue plan from the U.S. high-tech industry, a group he nurtured heavily during the campaign.

Mr. Obama's gathering with 13 chief executives at the White House Wednesday -- the first corporate sit-down of his presidency -- showed how much the two sides now need one another's support. Ten of the 13 executives run companies that would broadly be considered from the technology industry. ...

Most of the attendees also stand to benefit from the stimulus package, which emphasizes energy, infrastructure and technology projects meant to create or save millions of jobs.

IBM, for example, could benefit from Mr. Obama's proposal to spend $9 billion on high-speed Internet projects. IBM CEO Samuel J. Palmisano said a company-commissioned study found that a $30 billion investment in high-tech infrastructure could create more than 900,000 jobs. IBM's services unit would presumably benefit from all these initiatives, but the analysis said that most of the jobs would go to small businesses.

Aetna CEO Ron Williams said he pushed for a $20 billion investment in health-care information technology, which could help connect doctors and hospitals with electronic medical records. Mr. Williams said government will also have to work closely with the private sector to ensure that providers use the new tools. "The technology alone is not enough," he said.

Many of the CEOs said they were pleased that measures they had long championed were now part of the stimulus package. ...

Buying American is a Scam and a ripoff, by design (4.00 / 1)
As someone who worked in the car business for a decade in the last century, I wouldn't buy any American car today.  You would have to pay me, and I mean that literally, pay me to drive a Chrysler.  I worked for Chrysler during the 90s, and if the company offered me $10,000 a year to drive one of their vehicles, I would turn them down flat.  Maybe for 20 grand a year I'd put up with a car or truck that's in the shop 20% of the time, but that's what it would take to get me to drive one of their substandard products. They completely destroyed the once find Jeep line, which are now the worst rated vehicles on the road as of Consumer Reports testing in 2007.

And this is coming from someone who has owned mostly American cars throughout his lifetime, mostly GM products. That said, I've got 100 US dollars that says President Obama's new Cadillac limo breaks down and leaves him stranded, or the Windows won't roll down at some point during his presidency.

There is no comparison between the products produced in Japan, and the products that Japan produces in the United States using American workers, and those designs coming from American manufacturers that I believe have failure intentionally designed into the product in order to get the customers to buy new cars every two or three years. I did a comparison of the 1987 Acura Integra up against a 2008 Chevy cobalt, and the 21 year old Acura surpassed the new Chevy in almost every category, except for crash safety.

I got myself banned from Autoblog for similar comments, because the American car manufacturers actually pay people to monitor automotive blogs, where they regularly post pro-American car comments, and inform their PR people when someone is defaming their products and their organizations, so they can threaten the publishers with lawsuits, in the hopes of preventing the truth from getting out. I predicted the collapse and inevitable bailout of the US auto manufacturers three years ago.  So don't be surprised if you get a message from someone working for the American auto manufacturers regarding this comment.  They are perhaps the most corrupt and debased of all American corporations, and that's really saying something in America today.

we need the jobs -- and it's not about products but materials -- (0.00 / 0)
we've lost all our industries, almost -- and now import almost all our parts and materials, and only assemble things here -- if even that.

our money will otherwise go and benefit other countries instead of here -- and create jobs overseas instead of here where we desperately need them.

[ Parent ]
Sherrod Brown (OH) is supporting it -- that's one Senator at least -- (0.00 / 0)
http://www.statejournal.com/st... -- Brown wants Buy American Provision in Stimulus Bill

(he supports it for iron, steel, and concrete used)

Steel or (4.00 / 1)
making sure the funds go to hiring U.S. citizens, perm residents workers, to U.S. companies and all funds "recycle" within the United States.

While they are going off on the steel provisions I don't hear anybody talking about the big kahuna, which is jobs.

they claim 1 million of these jobs are IT jobs...well, potentially this means that at least 25% of these "jobs" would actually be offshore outsourced! (or use of guest workers brought in).  


The Economic Populist

[ Parent ]
Obama needs support (0.00 / 0)
Barak Obama looks v tired.
He needs a rest up, plenty of good food and lots of vitamins.
He can't strap the whole of America on his back and drag it to safety on his own. Someone needs to help this guy out!!!  

"Both versions of the bill include language that would allow the president to waive the protectionist measures" (0.00 / 0)


... Both versions of the bill include language that would allow the president to waive the protectionist measures if he decides that would be in the economic interests of the United States. But passage of the measures could in itself unnerve trading partners and encourage other countries to take similar protective action. ...

So, even if it ends up in there, it's not binding?!?

sick. just shameful.


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