Wednesday, September 15, 2010

Buy American, The Sequel? New Canada-U.S. Trade Battle Looms Ahead

(Lee-Anne Goodman — The Canadian Press)

Seven months after the Buy American resolution, Canadian manufacturers are poised to become ensnared in yet another protectionist piece of U.S. legislation even though the Chinese are the intended target.

Gary Doer, Canada’s ambassador to the United States, is sending a letter this week to congressional leaders, urging them to consider the impact on the Canada-U.S. trade relationship if the Foreign Manufacturers Legal Accountability Act passes Congress in the weeks to come. “As we are each other’s largest trading partner, Canada is concerned this legislation seeks to solve a problem that does not exist,” Doer wrote. “It could instead result in unintended consequences of unduly burdening our bilateral trade.”

The act, currently before the U.S. House of Representatives, is aimed at ensuring that the foreign manufacturers of defective protects can be served with legal papers. It was the result of the Chinese drywall fiasco that has damaged some U.S. homes and made homeowners sick; consequently, it isn’t expected to face many hurdles in Congress.

The act is part of a “Make It In America” initiative by nervous Democrats who are hoping it will score them points in what’s known as the Rust Belt, a manufacturing-heavy region of the Midwest and northeastern United States where exasperation about the widening trade deficit is off the charts. Rust Belt Democrats are vulnerable to defeat in the November mid-term elections less than eight weeks away. Read more here.