“Buy American” Requirements

On March 31, the Federal Acquisition Regulation (“FAR”) Council issued an interim rule implementing the Buy American provision of the American Recovery and Reinvestment Act (ARRA) of 2009, also known as the Stimulus Package.

The Buy American provision of the Stimulus Package requires, with certain exceptions, that regardless of size or duration, none of the funds made available under the Act be used on projects for a “public building or public work” unless all of the iron, steel, and “manufactured goods” used in the project were “produced” in the United States. “The interim rule implements three exceptions to the Buy American requirement that permit foreign material to be used: If (1) a particular construction material is not mined, produced, or manufactured in the United States “in sufficient and reasonably available commercial quantities of a satisfactory quality,” (2) the cost of domestic construction material is unreasonable, or (3) applying the Buy American restriction to a particular construction material “would be inconsistent with the public interest.” FAR 25.603(a). These are determinations for the government to make, not the contractor. “

The regulations do not apply to Recovery Act Designated Countries (“RADC”) and nations who are bound by a signed document such as a treaty, free trade agreement or contract with the World Trade Organization Government Procurement Agreement who produce construction material. However, some countries such as the Caribbean Basin countries have been excluded from designated countries and are treated the same as domestic products if the estimated contract value is $7,443,000 or more.

The Stimulus Package Buy American provision is an interim rule that should be made permanent in order for the U.S. to remain viable and competitive with the world market. In addition, the U.S. should increase the threshold for awarding 23 percent of contracts to small and disadvantaged business to at least 30 percent. Further a threshold should be placed on the number of contracts awarded to other countries. This is stimulus -- U.S. citizens’ money and every awarded contract dollar should be returned to the coffers of the American citizens.

In turn, America must re-invest in America to make up for the loss as a world leader in the areas of technology, science, and import/export. Shame on America if other countries materials are allowed to be used based on the three exceptions mentioned above because America is not able to produce the steel, iron, and manufactured goods used in construction, alteration, maintenance, or repair of a public building or public work on American soil. The American spirit will be broken if it does not regain its place as the world leader.

China is emerging as the world leader in science. Two decades ago, China was not a contender and yet today has overtaken Japan, Britain, Germany and France to become second only to the U.S. in the number of scientific research papers produced each year. China also made the third largest investment in research and development last year, after America and Japan.

China is in negotiations with seventeen countries, among them England, Russia, France and India to build a high speed rail network connecting Europe and Asia. The trains that China will build, the fastest in the world, will travel almost as fast as a jet plane. People will be able to take high speed rail, using Chinese technology not U.S., from London to Beijing.
Over the past several decades, most American businesses have learned to leverage the resources of foreign nations such as India and China by outsourcing the manufacturing of textiles and fabrics and almost any other type of commodity. The latest economic figures reveal that the U.S. is losing ground as a leading world exporter and now for the first time U.S. imports now exceed its exports. Although countries like China and India have massive populations, the U.S. still remains the largest economy in the world. The fact is that the U.S. consumer has an insatiable appetite and ability to consume, and these facts will not change overnight. We have become a nation that consumes more than it produces.
The U.S. is suffering due to this trend to import to U.S. more products than it produces locally. Statistics have shown that a number of job losses in the U.S. can be attributed to this trend. The difficulty for the now unemployed is to re-skill and is a contributing factor in the rising unemployment in the U.S.
Countries like the Korea, Norway, China, Japan, and a host of others are threatening to overtake the U.S. as the world leader in higher education. The U.S. is losing ground in terms of skill levels. On several measures such as having a high school credential the U.S. no longer holds the leading position.
As the workforce in the U. S. begins to adapt to this new globalised economic reality, it will begin to realize that it will also have to change and adapt if it is to survive as the world leader. America has played a major role in controlling the direction and development of the global economy and this has occurred due to the entrepreneurial spirit that has created much of the innovation we see in America. To continue to “give America away” is detriment to future generations and an insult to past generations who built this great country. Resources
Federal Acquisition Regulation. 74 Fed. Reg. 14,623-33 (Mar. 31, 2009). Retrieved from http:/www.acquisition.gov/far/html.
Zirkelback, G.D. (2009) “Anti-Fraud Regulatory Scheme Imposed on Stimulus Fund Contracts.”
Retrieved from

Cave, B. (April, 2009), “Interim Rule Issued Implementing “Buy American” Requirements of the Stimulus Package.” Retrieved from http:www.bryancave.com.

Arunachaiam, S. (June 2008). “China Emerging World Leader in Science”. Retrieved from http://www.universityworldnews.com.

Smith, A. (September, 2006). “US Slips as Education World Leader”. Retrieved from http:/www.guardian.co.uk/education/2006.