Obama packs ‘buy American’ clause in $825 billion stimulus plan
31 Jan 2009
The $825 billion stimulus bill, passed by the Democrat-controlled US House of Representatives on Wednesday, has a ''buy American'' clause to ensures that the money spent benefits only the American taxpayer.
The largest-ever stimulus package in history passed by a 244-188 vote in the Hose of Representatives, has to be approved be the Republican-dominated Senate as well to become law.
The Obama administration is hoping to rush through the bill by harping on the urgency and importance of the package as businesses and investors are ''waiting on Washington'' for ''bold and swift'' action to revive and rejuvenate the economy.
A major share of the stimulus package – about $550 billion – will go towards infrastructure and other federal spending while an $275 billion will come as tax rebates for individuals and businesses.
The bill, however, makes sure that ''None of the funds appropriated or otherwise made available by this Act may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron and steel used in the project is produced in the United States''
However, after the initial spending, recipients of the bail-out money will be free to to spend as they desired - which may boost imports from around the world and providing a huge economic stimulus directly to other countries..
Local steelmakers may still be left out and the package may fail to boost steel production within the US. It is also unclear whether the Senate will pass the ''protectionist'' bill in its current form.
US iron and steel companies, who were expecting a direct stimulus to their own sales from outside the United States, also seem unimpressed by the package.
Economists have reacted negatively to the bill saying that while negating expectations of US consumers to import from other countries, the stimulus plan would also raise the US government's burden by forcing costly consumption.
