Could "Buy American" Rule Spark Trade War?

Some Businesses Fear Clause In Economic Stimulus Package Could Hurt Their Exports

(CBS)  Now they're dipping into savings, delaying retirement, cutting back on everything from food to the collection plate at church. Jeremy Davis, a cold saw operator, was making $87,000 a year.

"It's bad. You've set your bills. You've set your lifestyle around what you're making," Davis said. "And so when it's cut in half, you know, first thing you have to do is start asking yourself, you know, where can I make cuts? We don't go out to eat no more. You know, we cook at home. We eat peanut butter and jelly and ham sandwiches for lunch."

"As opposed to the caviar you were eating before," Stahl joked.

"Exactly. No, we was eating turkey," Davis replied.

In pep talks, the employees keep asking their boss, CEO DiMicco: when will the tough times end?

"A lot depends on the stimulus package," DiMicco told Stahl with a sigh. "And I hate to rely on the government to do these things for us. But the reality is that bad and we have no choice."

It's not the first time steel has turned to Washington. A decade ago the industry was on its knees, with competition from cheap imports and unsustainable retirement costs. For every steelmaker on the job, the company had to pay six to eight retired workers. The industry begged for a bailout.

"But whatever you were asking for, Washington said no. And the industry collapsed, practically," Stahl remarked.

"We had 32 steel companies, 32 in this country, go into bankruptcy. You’re talking in excess of 100,000 jobs disappearing," DiMicco said.

Under bankruptcy, the companies shed their health care and retirement obligations. The industry bounced back because of consolidations, automation, and China.

"I would definitely say that the fact that the infrastructure was growing at the rate that it was growing in China and around the world, because of that we had four or five really good years," DiMicco explained.

But now steel is at the mercy of Washington again. DiMicco lobbied hard and passionately for the "buy American" clause in the stimulus package. "What we're saying is, 'Listen, yes 'buy American' benefits the steel industry in the United States. Absolutely.' But what we're saying also is might that concept not also benefit the U.S. economic engine, get it started again," he said.

[eyesC]

Fools, where do you think it went? China is expanding and needs vast amounts of steel, they can produce in mass volume without having to worry about restrictions. The market for steel isn't in here in the Socialist States of Obama not even Goverment Motors can use the amount of steel that China needs. Even the once thought recession proof Caterpillar will be crawling in the shoes of GM within the next few months. Then the Chinese will sell us just enough to get by on and we'll love them and WALMART for it!

[dmalman]

June 1/09
I really thought Lesley Stahl was on target with her report. Just this week the Federation of Canadian Municipalities is voting to direct purchases to countries that do not restrict Canadian Trade. It is my understanding that cities that border the USA in Ontario are already boycoting USA products for their municipalities. Protectionism is BAD,BAD, BAD.
D Malman

[jspeyton]

This is my first comment to 60 Minutes. I agree with the various posters that say that free trade is not free trade. My reason for believing this is people don't have enough information to make good choices.

I believe that the people of China would be better off if they joined the worldwide economic community on an equal footing. But my experience is that Chinese manufacturers do not "play by the rules."

First, Chinese manufacturing plants are far dirtier, less efficient, and bad for the environment than those in the US or Europe. We are paying for buying cheap goods with poor health. (The prevailing winds send the soot and pollution right over California.)

Second, many Chinese manufacturers use shortcuts that would be illegal here when manufacturing goods. That is why automobile owners get burned when they buy counterfeit replacement parts. That is why dogs in the US died from eating dog food tainted with additives prepared in China. That is why pharmaceutical manufacturers have had to recall their products made with ingredients from China. That is why children throughout Asia died when given formula made with illegal supplements. That is why Western chocolate companies that subcontracted manufacture of some of their products to China for distribution in Asia were burned when milk additives contained illegal additives.

And that is why I am having trouble with a garden plant hanger bought from Home Depot. I bought the heaviest, most durable two-hook plant hanger I could find. It was heavy - gauge steel and I thought sufficiently durable for Chicago winds. A week after I installed the baskets, during a thunderstorm, the hanger bent like a piece of cooked spaghetti.

I took it to a welder who told me that it is soft, Chinese steel.

Now, what do I know about soft steel or hard steel??? All I wanted was a durable hanger for my garden. But I am going to pay THREE times the cost of the original hanger to get it reinforced with American-forged steel.

Now, why can't I buy an American-forged steel plant hanger? I looked all over the Internet. All sites carry the same model, probably from the same manufacturer. I am offered no choice.

What I would like is to be better informed. Now I now know that there are all kinds of steel. I would like to be able to choose one that would actually be able to stand a little bit of wind. Believe me, I would pay extra for it. But store buyers are all buying in price, not quality. And that is the problem.

In looking at the story about the US mini-steel mill, I would LOVE go be able to buy products made in the US from recycled steel, but I am not given the choice.

And given that the issue of the story was about a "Buy American" provision for infrastructure projects, I would be TERRIFIED to drive on a bridge made with Chinese soft steel, bought based on price and not on quality. Remember what happened in Minneapolis. If 60 Minutes were doing their job, I would like to know where THAT steel came from.

Based on my experience with food, car parts, lawn ornaments, clothes, toys (remember the lead-based paint on the trains), shoes and umbrellas, I am more than willing to pay more to buy things made anywhere BUT China.

[larrydaddy]

Dear Lesley Stahi
I watch 60 minutes every Sunday at 7:00 pm on CBS. I have never had a real disagreement with most of your shows, but the one on May 21 2009 made me angry! In the first places if our Government hadn?t opened our market up to the world for free we would not be in this economy situation! If they had not paid the corporation to take their business over sea we would not be in this situation. You and your entire rich friend don?t seem to care about the working men & women who are losing their jobs and health care and retirement. The funny part about all of this is you and your rich buddy will end in the same sinking boat as the rest of us some day! I feel that every corporation that sends work over sea is anti American, because they support child lobar and are against human rights. Weather you are a union member or not has nothing to do with all the American good paying jobs that are going over sea. Some of the products that come back to be sold here are poising our own America people and people like you don?t seem to care. Our Government and rich greedy people did this to America! It?s sad that you are one of them.
Larry S. Palmer
726 32nd street sw
Wyoming MI 49509

[inachu1]

Buy American rule is not bad.
But it will not do any good.
Everything was outsourced or moved overseas.

Nothing left to make in the USA unless we export american workers to where the jobs are. SHould John Doe be sent out to work at his company in India to make a halfway decent living wage?
Should his income be taxed twice when he enters the USA? Once while overseas and again while he is in USA?

I would love to buy a computer that was 100% made in USA. All the pcb motherboards,transistors,capacitors,resistors,cmos chips.SMT technology.
If those things were made including the software then yes I would be one proud American.
The Idea of being an American is being dilouted.

[rfdald]

Jim Owen reflects the attitude of corporate America. He's willing to concern himself with living wage jobs for American workers as long as there is no negative impact on the profitability of his company. He wants taxpayer money to facilitate the purchase of cheaper foreign made materials and/or the exodus of production to foreign shores. Obviously the beneficiaries are primarily his investors, many of whom are non-American.. With disgusting numbers of American investors hiding their income in tax havens in the Caribbean, the benefit to American workers and taxpayers is minimal to non-existent..

[q42]

Fire "the best congress that money can buy" and take back your country. President Teddy Roosevelt did not sellout his countrymen in 1904 by exporting production but our leaders since Nixon has.

Stop giving tax breaks for exporting jobs, stop tarp money to off-shore companies, start to charge import duties at the same rate that we are charged to export to that country..

[middleman8]

The people who cry " Buy American " must also read only " American ".

Other wise they would find out the U S is the most subsidised country in the world.

What do they think the "Stimulus package" is ?

Why should people have to pay for overpriced products so some can set on their ass

and live high off the hog ?

[american_11-2009]

The Democrats infrastructure and construction bailout jobs program is more of the same old scam!

The tax payers that have obeyed the laws, paid the taxes and fought the wars and built this Nation are getting screwed by Corrupt/Stupid/Pandering Politicians and Greedy crooks at every level!

This is the same old scam, reward the Rich Bankers with billions in tax payers money and the invading horde of illegals Aliens with Jobs, Free medical, Free education, Welfare, Prison cells and make American Citizens pay for every Crook, Criminal, Peon, Welfare Leech and Marxist or Racist organization like ACORN or La Raza in the world!

The infrastructure and construction jobs without E-verify will put the millions of Illegal Aliens back to work, so they can send money home to support Mexico & South American at the expense of American workers and our economy! The contractors can charge the tax payers union scale, hire Illegals at slave wages, pocket the profits and American citizens pay both the wages and the billions in cost to educate the illegals many children, provide medical, welfare and prison cells.

You would think the Politicians would be content with just outsourcing all the jobs that can be done offshore but No they want to bring in Slave labor & Welfare votes ( while ignoring Article IV Section IV of our Constitution against invasion, the rule of Law, and their Oath of office) to take the jobs that cannot be outsourced! To add insult to injury they make the American citizens still working pay billions in extra taxes for schooling, provide medical, welfare and jail cells for the invading horde that are taking our jobs and driving down our standard of living! While keeping busy Robbing, Raping and Killing American citizens at an rate that Bin Laden can only dream about!

The Democrats love the millions of Welfare votes to further their Socialist agenda & the Republicans love the slave labor for their Pay Masters in the Chamber of Commerce and business.

If we are realistic and look at the havoc caused by the millions of invading Hispanics on our communities, culture, crime, economy, welfare, taxes, environment, schooling and standard of living the only conclusion possible is that no Nation can withstand or assimilate an tidal wave of Uneducated Third world citizens that come here illegally from another culture, for the jobs and welfare, while keeping loyally to their home countries!

This Nation is changing to the very same type of culture and society the invading millions have created, built and sustained for 100,s of years and are now fleeing in their own Countries!

One has to only look at Calif. which is basically an Bankrupt state that cannot afford to provide Welfare, Schooling, Medical, Prison cells etc. for millions of MS-13 Gang bangers, Drug dealers, Rapist and other assorted Criminals and uneducated third world rejects from Mexico!

In a very few years it will be impossible to see where Mexico ends and California begins without reading the signs as both will be an third world cesspool!

Failure to secure our borders and reward the Invading horde for their invasion and their relatives in an never ending chain with American Citizenship is nothing less then committing National Suicide & will assure our future is an over populated Spanish speaking third world Nation that is an Cesspool of Corruption, Crime, Poverty and Misery just like Mexico!

[prantha]

I do not want my hard-earned tax money to pay for cheaper Chinese steel. If I am going to give Catepillar money to purchase steel, I want my money to stimulate American jobs; not Chinese jobs. Period.