I thank the gentleman from New York (Mr. Hanna). I rise in opposition to this motion to instruct. The motion to instruct would add to already stringent Buy American provisions in American law that apply to highway, transit, Amtrak, and…
I thank the gentleman from New York (Mr. Hanna).
I rise in opposition to this motion to instruct. The motion to instruct would add to already stringent Buy American provisions in American law that apply to highway, transit, Amtrak, and inner city rail projects, making them unworkable in our increasingly globalized economy.
I know this is well-intentioned. But too often in Washington, what some hope a bill will do, in fact, it does just the opposite. I know that many Members see the term ``Buy American'' and think they should automatically be in
support. I understand that. I can certainly see justification for some Buy American provisions, and we already have that in law today. These are longstanding rules that are manageable for our American job creators and aligned with our international standards.
However, ``Buy American'' doesn't actually mean what it appears to mean. This motion to instruct would actually have the opposite effect, undermining America's transportation, infrastructure, and development as well as America's competitiveness and job growth. Instead of providing surefire markets for our local companies, goods, and services, this motion to instruct would actually backfire. The result will raise costs for American taxpayers, delay American projects, and burden American businesses that could, instead, be focusing on creating jobs in the struggling economy. And it conflicts with our goal of making the United States the most competitive country in the world.
I also want to insert into the Record two letters, one from the U.S. Chamber of Commerce, which is representing 3 million businesses in America, and another from the Emergency Committee for American Trade, local companies that employ over 6 million workers, both opposing this motion to instruct.
Let's explore the reasons why I urge my colleagues to oppose this motion. First, it will increase costs for transportation projects by requiring that local content requirements apply to more projects by making waivers from these local requirements much more difficult.
That means that few transportation projects can be undertaken to fix our aging infrastructure. This is not the time to impede strategic investment in American infrastructure, which holds the key to U.S. economic competitiveness and prosperity.
Second, a misplaced requirement to ``buy local'' would hurt American companies, undermine their competitiveness, hamper their innovation and productivity, and prevent them from participating in bidding for transportation projects due to their increasingly global supply and production chains.
As we all know, many products that American companies build will sometimes have parts from other parts of the world, mainly so they can compete against other products in the world. Take, for example, a store from back home in Texas, where a Canadian manufacturer of PVC pipes and fittings was advised by its distributor in California that the contractor, who had used its fittings on sewage pipes installed at Camp Pendleton, was being asked to remove the fittings from the ground and replace them with a similar product from an American competitor.
So far, it sounds good. The problem is the Canadian manufacturer purchased most of its plastic resin inputs to make those fittings from Texas-based companies--from American companies in Texas. That meant that Buy American restrictions prevented our local companies from being able to export their product to Canada and sell it as part of an overall project in California. It was an overall lose-lose situation for everybody.
In short, more stringent Buy American provisions actually make it harder to sell American because of the realities of how products are built these days. These provisions will prevent American companies from being able to sell inputs--their products--to foreign companies, who then go after government contracts. It may sound attractive to cut foreign companies out of the procurement market, but don't forget about the thousands of American companies and millions of American workers who stand behind them and depend on them.
Third, tightening Buy American restrictions also sends a message to our global competitors that it's all right for them to enact more barriers against American goods and services when they're selling and buying procurement in their home market. In fact, all over the world-- in countries like China, India and Brazil--local-content rules in a variety of industries are popping up to block American companies from selling into there.
In justifying those restrictions against our American companies, these countries often point to Buy American provisions and argue that what they're doing is just the same. Well, this dynamic has the effect of stopping American businesses and their workers from competing in vast foreign procurement markets around the world, resulting in billions of dollars lost to America and to our opportunities to sell our products overseas.
Fourth, such measures also make the United States a less attractive market for foreign-based companies that employ millions of hardworking Americans here at home. Expanded domestic content requirements send precisely the wrong signal, as America seeks to reverse the trend of declining foreign investment into America, which creates products and companies and jobs here in America.
And, fifth, tightening the Buy American restrictions could also leave the United States vulnerable to World Trade Organization litigation and retaliation based on what our obligations are under the WTO government procurement agreement.
Overall, stricter Buy American provisions undermine the American Government's ability to buy the highest quality goods and services at the lowest cost to us, the American taxpayers. It makes it more difficult to maintain policies consistent with our obligations around the world, and it blocks our ability to show our trading partners they need to open their procurement markets to American goods and services, and at the same time they hurt U.S. companies that are trying to find customers for their products and services.
I understand how politically appealing these measures can be; but when they backfire against American companies, when they backfire against American workers, you don't read much about it, but it costs these workers their livelihood. Frankly, it takes American companies competing here at home and around the world out of the picture.
At a time when we have a struggling economy, after the stimulus, after all the bailouts, after all the Cash for Clunkers, deficit spending, we actually have fewer Americans working today than when the President took office. Now is not the time to hurt more American workers, drive up the cost of these projects, delay them further, and ultimately hurt our ability to compete and sell around the world. No matter how politically appealing, this makes no economic sense for America.
For all these reasons, I urge my colleagues to vote ``no'' on this motion.
Chamber of Commerce of the
United States of America,
Washington, DC, May 17, 2012.
To the Members of the U.S. House of Representatives: The
U.S. Chamber of Commerce, the world's largest business
federation representing the interests of more than three
million businesses and organizations of every size, sector,
and region, urges you to oppose the Rahall Motion to Instruct
on the Highway Extension Conference Report that would expand
requirements that projects be built with U.S. steel and other
goods--otherwise known as ``Buy America'' provisions.
The Rahall motion would impose costly and burdensome
contracting obstacles upon federal, state, and local entities
that receive funding under the surface transportation bill.
Passage of this motion would have the unintended consequence
of increasing costs and delaying much-needed infrastructure
reinvestment, thereby resulting in fewer transportation
projects being funded.
While the ``Buy America'' sentiment may sound appealing,
the reality is quite different. As the U.S. already imposes
significant ``Buy America'' contracting requirements, the
Rahall motion would undermine American job creation and
competitiveness, and would undercut Congress' goal of
ensuring that transportation funds are spent in the most
efficient and cost-effective manner possible. There is no
need to expand ``Buy America'' provisions and doing so would
be highly counterproductive, particularly for industry
sectors hard hit by the recession.
The Chamber opposes the Rahall Motion to Instruct and urges
you to vote against this effort to expand ``Buy America''
provisions.
Sincerely,
R. Bruce Josten.