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The Trans-Pacific Partnership: Gutting Buy American

From the workers who manufacture the materials to upgrade America's bridges and highways to those who build the cars driven by our government officials, Buy American creates U.S. jobs by recycling U.S. tax dollars back into our economy. Buy American policies require that most federal government purchases of goods go to American firms, unless a product is not made here or the U.S. product is much more expensive. Buy American is supported by four out of five U.S. voters – Republicans, Democrats and independents alike.

But Buy American is under attack by our status quo, corporate-driven trade model. In many U.S. trade agreements — the World Trade Organization’s (WTO) Agreement on Government Procurement, which covers the U.S. and 39 other countries, and in free trade agreements that the U.S. has with 15 countries — governments are forbidden from giving preference to domestic goods and services or domestic firms in awarding procurement contracts over a certain threshold for covered sectors. Each time a new trade pact is passed that includes the ban on Buy American preferences, the involved countries are added to the waiver list to be treated the same as U.S. companies for government procurement. This means more and more competition for U.S. workers, fewer jobs and lower wages.

The Trans-Pacific Partnership (TPP) would have further gutted Buy American and cost American jobs under rules requiring “national treatment” in government procurement. To implement this TPP requirement, the United States would have agreed to waive “Buy American” procurement policies for all firms operating in TPP countries, offshoring our tax dollars to create jobs abroad. Some corporate TPP proponents argued that these rules would be good for the United States because they would have allowed U.S. firms to bid on procurement contracts in TPP countries on equal footing. The notion that this is a good trade-off for waiving Buy American preferences on U.S. procurement is ridiculous. The U.S. federal procurement market is larger than the combined national procurement markets of all other TPP negotiating parties. Even more, U.S. firms already have equal procurement access in most TPP countries under existing deals. Counting only TPP countries in which this is not true, the U.S. federal procurement market is more than 14 times the size of what the total “new” TPP procurement market would have been.

Check out our map showing how your state's tax dollars are contributing toward federal procurement

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