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EU attacks Obama 'buy American' plan as new Iron Curtain
Joe Murphy, Political Editor3 Feb 2009
Britain and Europe were today embroiled in the first big row with Barack Obama - and it was over free trade.
The US president's plan for a "Buy American" rule in his £825billion economic stimulus package was condemned as a dangerous retreat into protectionism.
The clause decrees that only American-made iron, steel and goods can be bought for projects funded by the recovery package.
A European Commission spokesman dubbed it the "worst possible signal" that the new presidency could give to the world.
Downing Street was less outspoken but the Prime Minister's spokesman said: "Obviously we would not support protectionist measures."
Gordon Brown has made a series of speeches in recent days warning urgently that a failure to uphold free trade risks turning the world recession into a deep slump.
London Mayor Boris Johnson joined in the row, saying that Mr Obama was making a major mistake under pressure.
"Remember what happened in the Thirties, when they had exactly the same instinctive and panic-stricken reaction, and a recession was turned into a slump," the Mayor warned on his blog.
"Remember the old truth, that when goods, people and services are not allowed to cross borders, soldiers eventually force the way.
"We need Obama to drop the Buy American clauses of his package, because in the end - no matter how seductive the idea may be - a refusal to compete and a refusal to be open will be no good for America and no good for the world."
He urged a new bid to complete the Doha trade talks and release a "pent up" rush of commerce.
The EU ambassador in Washington warned that Mr Obama's clause could backfire by encouraging other countries to impose tariffs and barriers to protect their own domestic goods and jobs from US competition. In addition, the EU and Canada are to make a formal complaint to the World Trade Organisation.
British MEPs have warned of "a new economic iron curtain" being drawn across Europe. The clause "sends a terrible protectionist signal to the rest of the world, and particularly the EU", said Syed Kamall, the Conservative trade spokesman in the European Parliament.
The White House has said it is reviewing the Buy America part of the stimulus Bill, although vice-president Joe Biden said last week that it was legitimate to have some portion of it in the final measure.
Mr Obama promised to protect heavy industries during his election campaign. The pledge was popular with white working class voters who had been sceptical about him until then.
Reader views (10)
Few are aware that this is the 14th year in a row that the EU accounts show up to 95% of the £12 billion we pay annually is unnacounted for stolen, 95% missing? Who knows because Mp's who have won the right to investigate have found no auditrail reciepts or papers. Over the 14 years that amounts to 95% of £168Billions is missing. That is only the British contibution but the auditors actually also refer to theTotal EU Budget totalling £Trillions that is Unnacounted for Missing----stolen?
- Peter, Camberley UK, 10/03/2009 16:39
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Do the math - the U.S. lost two and a half million
jobs last year - after the North American Free Trade
Agreement imposed by the last administration, those jobs given to foreign workers to cut the overhead of the very rich here, the richest two percent. If Europe really does
want their economy back, better go back to when things were working right, correct? Ask yourself what was right with that, and what is wrong with this.
I wise man once said, the laborer is worthy of his hire,
(Jesus). When the very rich here in the U.S. forgot that concept to fill their own pockets, just to cut overhead,
the rest of the world including the U.S. suffered for it.
Put the people here back to work, pay them, and the rest of the world will be the better for it because that will boost the world's economy. It is very simple math, justified by the wisest man that ever lived, that didn't care about cutting overhead, but knew the value of feeding one's family from one's honest labor.
James, L.A. California
- James, L.A. California, 06/02/2009 03:09
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Seeing how the EU has yet to remove trade barriers between its own members, them telling the USA how they should distribute taxpayer money seems a bit rich.
Economies that rely on taxpayer money to stimulate them shoot themselves in the foot if that money goes straight into the pockets of foreign workers. The idea of stimulating your own economy is to ensure your own workers have work, which they can then use to spend on goods and services, making the money go round in that economy.
If the workers are not employed there is no taxpayer funding, so the economy dies.
US tax dollars for US jobs sounds extremely prudent.
In the UK, Jaguar cars are in trouble, and laying off workers. Gordon Browns answer is to take UK taxpayer money and buy BMW’s.
All government departments and employees only have their jobs thanks to the UK taxpayer - voters should take note how they spend YOUR hard earned money – do they support yours or another nation?
What shouldn’t happen is that state funded industries be able to export and undercut other nation’s efforts endeavours – a EU concept.
- Ian, Reading, England, 04/02/2009 08:41
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This protectionism will take the world back a few centuries where we all kept whats ours and never share or trade!! yes that is great thinking!! So Mauritius will keep its Tourism to Itself!! great!! Do u really think this is sustainable?? the world today is a big trading playground. countries specialise in different industries which are better suited for them. From this, trade is possible, growth is possible. if the US starts with this the whole world will follow. thus all the oil states and countries with basic commodities will keep their precious oil and metals at home and the world will collapse!! believe it or not the US is at the center of world trade! and their decisions affect the world! Tell me what basic commodities does the UK have?? if u pull an IRON CURTAIN on the UK im sure you can grow tomatoes to survive and ull be ready to ride bicycles, and build buildings out of wood!! and make yr machines work out of yr excrements!!
really ppl!! i hope not everyone doesnt think like you.
- Mikael, Mauritius, 04/02/2009 04:53
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It's about time an American President actually looks after the intrests of real Americans!! God Bless you Obama, keep standing up for whats right!
- Jesse, Jefferson, Ohio, 04/02/2009 02:19
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Well now!........Lets all just wait and see how it all pans out!
Not the first time USA has gone it alone, although, this time they are not self sustaining, they need to export same as all the rest of the developed world!
Should be interesting, with all the re-tread advisors he has appointed!
GERONIMO
- GERONIMO, LONDON MIDDLESEX, 04/02/2009 01:40
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Not that we actually make anything worth exporting...
Obama is doing what a U.S. President should do. Take care of his own people first. While Gordy is busy kissing the rear end of a Chinese dictator.
An overthrow of the current UK government cannot come soon enough!
- Mel, London, 03/02/2009 23:38
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Do you guys even realise what effect this going to have on companies which are nasdaq registered, sitting in UK and providing jobs to millions of peoples. If uk starts saying buy only from onshore companies then these companies will ultimately exit uk market and we are going to be left with more unemployment than we are anticipating by the end of this crisis.
Never had the urge to join Mr.Gordon's fan club but I agree what he has to say on this topic.
- Wagener, Midlands, 03/02/2009 16:30
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Well done Mr. Obama. At last! a world leader who puts the interests of his country and its people before political posturing and kow-towing to other nations. What a pity Gordon Brown & Co. haven't the guts to do the same to help the UK. Clearly, Lord Mandy would learn much from you Mr. Obama.
- Joannie, London, England, 03/02/2009 15:48
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Good for Obama. It's a pity our government doesn't do tha same - and don't say it's against EU law, because i could not care less. It's about time we paid a bit more time and effort in looking after our own.
- Anthony Heath, Godalming, 03/02/2009 15:11
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