• By The Financial District

CNN Analyst Says Biden's 'Buy American' Tack Is Bad Economics

With votes in the Senate to advance his bipartisan compromise last week, President Joe Biden took a big step toward upgrading America's infrastructure, John Harwood said in an analysis for CNN.

Photo Insert: President Joe Biden discussing economic policies he hopes will reshape the economy for the working class

And he took a small step toward ensuring Washington can upgrade less of it. That step backward came with Biden's move last week to stiffen requirements that federal government purchases be limited to products made in the United States -- even if they're more expensive.

Thus, he followed the grooves set by both Democratic and Republican predecessors, who have consistently embraced crowd-pleasing "buy American" stances that make economists groan.

"Counter-productive," cautioned Melissa Kearney, a University of Maryland professor who favors much of Biden's economic agenda. "It really makes some of the administration's other goals harder to achieve."

Biden acted to strengthen the nearly-a-century-old Buy American Act, whose provenance alone hints at shaky economic foundations. It was signed into law by former President Herbert Hoover, who had earlier signed the Smoot-Hawley protective tariffs at the dawn of the Great Depression.

All the news: Business man in suit and tie smiling and reading a newspaper near the financial district.

That association has not diminished its political appeal as America's economy over the decades has become steadily more integrated with the rest of the world. Former President Ronald Reagan signed a companion law as America lost industrial jobs in the 1980s.

Former President Barack Obama incorporated Buy American provisions into his 2009 stimulus plan in response to the Great Recession. And Buy American provided a natural component for former President Donald Trump's pledge to "Make America Great Again."

Market & economy: Market economist in suit and tie reading reports and analysing charts in the office located in the financial district.

Trump signed a series of executive orders advancing the theme. But as with steps taken by earlier presidents, they allowed ample room for such exemptions as complying with international trade agreements and permitting the purchase of some foreign-made goods when suitable domestic alternatives were unavailable.


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