US House member open to Senate "Buy American" plan

WASHINGTON Mon Feb 9, 2009 11:32pm GMT

WASHINGTON Feb 9 (Reuters) - An Indiana Democrat who crafted Buy American provisions approved by the House of Representatives is likely to agree to changes made by the Senate last week to address international concerns, a spokesman for the lawmaker said on Monday.

"He's indicated he's inclined to support it," a spokesman for Representative Pete Visclosky said. "I think the objective is (creating) American jobs, and it appears the Senate language would do just as good a job, if not better" than the House version, he said.

Visclosky, who is chairman of the Congressional Steel Caucus, used his position on the House Appropriations Committee to add language requiring all public works projects funded by a huge economic stimulus bill use only U.S.-made iron and steel.

That sparked concern in Canada and the European Union that their steel exporters would not share in the vastly expanded U.S. public works market, despite some commitments the United States has made under the World Trade Organization government procurement agreement.

Many U.S. business groups also warned that the House move could backfire on the United States by encouraging other countries to put similar provisions in their stimulus plans or adopt other measures viewed as protectionist.

After President Barack Obama urged Congress to drop any provision in the stimulus package that could trigger a trade war, the Senate toned down its version by requiring that the Buy American provision be "applied in a manner consistent with U.S. obligations under international agreements."

The Senate is expected to approve its overall stimulus bill on Tuesday. That would set the stage for negotiations with the House on a final package to send to Obama, who has said he wants Congress to finish its work by Monday.

The Senate Buy American provision is broader than the House version in one important way because it requires public works projects funded by the stimulus bill to use U.S.-made manufactured goods in addition to U.S.-made iron and steel.

Still, Canadian and European Union officials have cautiously welcomed the Senate vote, which gives members of the government procurement agreement and various U.S. free trade pacts comfort they could still supply some steel and other goods for the new stimulus projects.

However, the United States does not have specific government procurement commitments with many countries such as China, Brazil, India and Russia.

(Reporting by Doug Palmer; editing by Vicki Allen)

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