Diary

'Stimulus' Kills Pennsylvania Steel Jobs

Remember how having a bunch of brilliant grown-ups in the White House was going to restore our tattered relations with key allies? And how the ‘stimulus’ bill would create millions of jobs here in the United States?

Instead, the bill has sparked a trade war with Canada – one that will get worse if it is not addressed. And while the Obama team can offer only guesses as to how many ‘stimulus jobs’ fit on the head of a pin, we can already point to 600 Pennsylvania steelworkers who are losing their jobs as a direct result of the bill:

Canadian and American business leaders joined forces Thursday to warn of the growing threat to prosperity in both countries due to the so-called Buy American provisions in President Barack Obama’s economic stimulus package.

“You can see billions of dollars that are in jeopardy, and tied to those billions of dollars are jobs,” Myron Brilliant, senior vice-president of international affairs for the U.S. Chamber of Commerce, told a news conference in Washington.

“We are sending exactly the wrong signal to our trading partners and we are very concerned about the impact it could have (and) that there could be retaliation that spirals out of control.”

Jayson Myers, president of the Canadian Manufacturers and Exporters organization, joined Brilliant and Chris Braddock, another chamber executive, to urge the Obama administration to provide clearer guidelines to states and municipalities grappling with what the provision means.

Obama signed his US$787 billion economic recovery bill into law in February. It dictates that the steel and manufactured goods bought with federal funds must be made in the U.S.

That has effectively shut out Canadian companies that make everything from steel pipes and equipment to specialized machinery from bidding on contracts to build bridges, repair sewers or update municipal waste treatment plants.

A caveat to the bill, requiring that international trade obligations be obeyed, has had next to no impact on state and municipal officials, most of whom aren’t required to adhere to those pacts and fear they’ll receive no federal funds if they buy anything other than American goods…

Stateside, the sting is also being felt. As many as 600 steelworkers in Pennsylvania, whose union lobbied for the Buy America law, are slated to lose their jobs at Duferco Farrell after the company lost orders from its biggest customer because some of its goods are partly produced abroad.

It’s ironic that Obama’s policy has fostered cross-border cooperation – in an effort to repeal his agenda and prevent further job losses. And where the administration should be vigilant to promote economic growth, they are instead oblivious to the damage their policies are doing.

Update: Fore more on the Duferco dilemma, check out this piece by Streiff about a month ago.