January 14th, 2010
By The Last Sober Irishman
Now before you go and bite my head off, I first want to point out that until I was recently laid-off, I was an American factory worker in a union controlled plant in the mid-West. I am definitely in favor of businesses investing locally whenever feasible, and preferably with American companies. The problem I see with the newly proposed “Buy American” provisions on the new economic stimulus plan is that it doesn’t leave a whole lot of flexibility. Allow me to point this out in the simplest way possible.
Let’s say you are shopping for a new car. You are a loyal, hard working, taxpaying American citizen, and you want to spend your money to help support American workers. This is admirable of you. However, what constitutes “American Made”? Ford, Chrysler, and G.M. are all American companies, but a sizable number of their vehicles, particularly passenger cars, are made in Mexico and Canada, thanks to NAFTA. Toyota, Honda, and Nissan are all foreign manufacturers, but a significant number of their vehicles are actually produced at plants in the U.S., made by American workers. Which of these is more American? Even if you buy a vehicle from an American manufacturer and you know it was assembled in the U.S., what percentage of its parts were made in the U.S.? I spent a summer working for a dealership, and even they can’t tell you that. How does one make an informed decision then?
A second dilemma is the product itself. Using the same analogy as before, you do your research and find that the foreign manufacturer has a higher average quality than the American made vehicle. While you want to support your fellow countrymen (and women), do you sacrifice quality for the sake of a flag? Or perhaps cost comes into play, and the foreign vehicle, while similar in quality, is significantly less expensive than the domestic vehicle. Maybe you have $25,000 to spend and have to choose between a mid-size American sedan, with no options, or a full-size luxury sedan, loaded with all available features, made in Korea. That’s not an easy decision to make.
This is the inherent problem with forcing a limitation of “Buying American” into any stimulus package. While I’m all for creating American jobs, are the American corporations I’m buying from actually creating jobs here in the U.S., or are they shipping the work to plants overseas that have less expensive labor? Do we pay the same amount for half as much product because it costs more to produce (hypothetical example) steel in the U.S. than to import that steel from Russia? Do we buy an inferior product that is made in the U.S. instead of purchasing a better quality part that may have been made in Germany? By limiting us to “American Made” products, we tie the hands of our industrial and political leaders in trying to fix this problem. The Unions, unfortunately, are as much a part of the problem as the corporations are at this point. While understandably trying to protect their workers, they have failed to see the bigger picture. Unless we can compete at the same level as foreign manufacturers, American companies will continue to go belly-up because unions are unwilling to lower wages to match the competition’s. The question should not be “is it made in America?” The question should be, “why isn’t made in America able to compete?”