Sovereignty Again at Risk at WTO: India challenging Buy America in the States

September 13, 2016

by Michael Stumo

This is a very big problem. Thanks to rigged trade deals promoted by the Clinton/Bush/Obama administrations, there is a new globalist attack on US sovereignty, our jobs, and states' rights. India is asking the World Trade Organization (WTO) to authorize penalties against eight states' Buy America rules in renewable energy programs.

The geniuses at the US Trade Representative's office have long used trade treaty negotiations to gut America's longstanding Buy American rules.  The government procurement agreement within the WTO, NAFTA, CAFTA and virtually all of our trade treaties have provisions that prohibit the US from preferring domestic sources over foreign vendors for taxpayer funded government projects.

Buy America provisions are wildly popular among taxpayers, who don't want their tax money offshored to fund competing foreign companies when US companies with US workers can provide the goods, services and infrastructure. Buy America rules, also known as domestic content laws or domestic procurement rules, are fiscally intelligent because you can stimulate private sector growth with military, infrastructure and other contracts awarded to US companies. If billions in taxpayer money buys foreign sourced product, we stimulate someone else's economy, not ours. Which is stupid.

But the USTR and special interests say that the trade treaty prohibitions against domestic procurement allow US companies the opportunity to bid on foreign government contracts. That sounds ok until (a) you look at the data showing it hasn't worked out well and (b) you realize that the US federal government is the biggest consumer in the world... and you don't give that market up cheaply unless you are an idiot.

Last year, the WTO ruled our country of origin labeling laws for meat are a "barrier to trade", and now private consumers are unable to confidently "Buy American" for their families. India is taking the step of challenging state-level Buy America rules.

According to Geneva sources, India is specifically raising issues with renewable energy programs provided by the states of Washington, California, Montana, Massachusetts, Connecticut, Michigan, Delaware and Minnesota. The programs provided by those states violate the WTO Agreement on Trade-Related Investment Measures (TRIMS) and the Agreement on Subsidies and Countervailing Measures, Geneva sources said.

(Inside US Trade, 9/12/16, subscription required)

There is a real risk that the WTO will eventually rule against state-level domestic procurement rules in this renewable energy, with the result affecting ALL state-level domestic procurement. For roads, bridges, vehicle fleets, etc. This is a big problem.

This is an assault on US sovereignty. It is an assault on states' rights. It is an assault on our fiscal policy. It is an assault on our economy and our workers.  If India succeeds, we will be forced to offshore our taxpayer money just as we are offshoring our jobs and our industries.

To reclaim American growth and our middle class, we have to turn back the globalist assault on our economy. It may be time to reconsider whether the WTO is doing more harm than good and explore withdrawal.

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