Committing the federal government to “Buy American” in its procurement practices? Ah, there we go, time to revert to my more traditional mien of disappointment.
My Washington Post colleagues Jeff Stein, David Lynch and Ashley Parker wrote up the announcement, and it is worth going through some of the claims in that story:
The executive order will call for increasing the amount of U.S. content that must be in a product for it to be considered made in America under existing “Buy American” requirements. It will also create a website where American businesses can see what contracts are being awarded to foreign vendors, and a position at the White House Office of Management and Budget tasked with implementing Biden’s push on federal procurement.The order reflects in part the shifting consensus in American politics away from free trade and toward direct government intervention to promote U.S. manufacturers, a position former president Donald Trump embraced as well. The pandemic has intensified calls for the United States to shore up its domestic manufacturing capabilities, given gaps last year in the medical supply chain that left U.S. medical workers scrambling for personal protective equipment.
It’s the “shifting consensus in American politics away from free trade” that gets me, because strangely enough, public sentiment has shifted in the exact opposite direction. In 2020, Gallup recorded the most positive public attitude toward foreign trade in its history of asking the question. The Chicago Council on Global Affairs also found strongly positive views toward globalization. While the consensus among politicians might have shifted away from free trade, the public has shifted in favor of it.
The Post write-up goes on to explain: “The administration is determined to move beyond the traditional single-minded focus on price and efficiency in its approach to trade policy. ‘As we sort out what globalization is going to look like in the future, we’re headed toward a more thoughtful policy,’ said one trade specialist advising the administration.” Because nothing says “thoughtful” like expensive and inefficient.
Axios’s Hans Nichols reports that as part of this Buy American plan, “Biden will also reaffirm his support for the Jones Act, which requires maritime shipments between American ports to be carried on U.S. vessels.” Sounds great, except that it is an outdated piece of legislation that has harmed Puerto Rico, Alaska and Hawaii for decades. The Biden administration’s claim that it will accelerate the development of offshore renewable energy also seems fishy.
A quick glance at the reporting of this particular executive order reveals two things. The first is a jaded aspect to the coverage. As the Reuters story notes, “Boosting U.S. manufacturing … has proven a vexing challenge for previous administrations, including that of former President Donald Trump.” Indeed, the Buy American logic has a long and distinguished tradition of not working well at all, requiring previous administrations to back down from their maximalist claims.
The second is a series of anonymous quotes from a senior Biden trade adviser asserting that this time things will be different, because … I dunno, Biden really means it? One official told Reuters that President Biden “does not accept the defeatist idea that automation, globalization mean that we can’t have good-paying union jobs here in America.” Hey, I don’t accept that idea either — but that has nothing to do with whether Buy American is the answer. (It’s not.)
The best articulation of the Biden logic comes from this Twitter thread by the Roosevelt Institute’s Todd N. Tucker — but there is a lot of wish-casting and misplaced emphasis on manufacturing in that thread. U.S. manufacturing is actually doing pretty well right now. Disruptions to supply chains are what’s holding it back. More protectionism will hinder that in the short run. It’s the service sector that is ailing, and no procurement policy will fix that. Even by focusing specifically on manufacturing and employment, an ambitious infrastructure plan would be far more significant on that front.
To be clear, noneconomic factors should be factored into some procurement calculations. I get the concerns about national security, I really do, but that doesn’t require this kind of ineffectual, inefficient blanket action.
In 2019, I had an ongoing debate with more liberal policy wonks about whether the United States could engage in an adroit use of government authority to set standards and advance U.S. interests. They were optimistic. I was skeptical. I guess this is the hypothesis-testing portion of that exchange.