Free (sort of) Trade

Sunday night’s broadcast of 60 Minutes featured a piece about a provision in the recently enacted stimulus package. It seems that part of this massive bill stipulates that any project undertaken with stimulus funds must use American made products. One of the featured guests was the CEO of Nucor Steel Corp. who spoke favorably of this requirement. One would think that all American CEOs would feel this way, right? But another person, the Caterpillar Corp. CEO, argued against this requirement by stating that if America institutes protectionist policies, it will only invite other countries to strengthen their trade restrictions. We need to keep trade borders open. Back to the steel guy. BULL! If we were on a level playing field with everyone following the same rules, fine. Let’s have fair and OPEN competition but it's his contention that the concept of fair trade only exists in a Harvard B-School classroom. Without exception every other country in the world has protectionist policies that work against U.S. manufacturers. Where’s the justice?
Soooo…..what does one make of this apparent contradiction? Who’s right? My gut says the steel guy. Here’s why. Other countries need the U.S. more than we need them. We all have something to lose unless we all play by the rules but others have more to lose because without question the U.S. is the biggest consumer of foreign made products than anyone else. Who exactly do you think it is driving the red hot Chinese economy? Besides, paraphrasing a piece someone sent me a while ago, what has happened to good old Common Sense? Enough is enough. American manufacturers are hurting big time. Are we really going to set off catastrophic trade wars by taking care of our own? I think not. It's a good provision. Caterpillar is still going to sell plenty of its stuff abroad because frankly no one makes heavy equipment like them. Should all imports be barred? Of course not. That doesn't make any sense either. After all, when it comes right down to it, let's not forget that it was foreign competition that was the driving force behind the vastly improved quality of American made cars. But there needs to be a balance and this provision seems to help do that.