‘Buy American’ Clause in Stimulus Sparks Controversy

RAY SUAREZ:

While there's already plenty of debate surrounding the stimulus, one provision in particular has sparked a major fight between labor groups, members of Congress, and foreign governments.

It's called "buy American." It would require that any manufactured goods used in public works projects connected with the stimulus money must come from American suppliers.

That proposal has triggered an uproar from a number of America's trading partners and from some business groups. Yesterday, President Obama weighed in, saying he thought the "buy American" provision does not belong in any stimulus bill. Here's what he told ABC's Charlie Gibson.

U.S. PRESIDENT BARACK OBAMA:

I think that would be a mistake right now. That is a — that is a potential source of trade wars that we can't afford at a time when trade is sinking all across the globe.

CHARLES GIBSON, host, "ABC World News Tonight": What's in there now? Do you think that does that? Do you want it out?

U.S. PRESIDENT BARACK OBAMA:

I think we need to make sure that any provisions that are in there are not going to trigger a trade war.

RAY SUAREZ:

The president's remarks in turn prompted more reaction today. The Canadian trade minister said he was encouraged by Mr. Obama's statements.

However, some of the president's congressional allies insisted the provision remain in the bill. The chairman of the House Transportation Committee, James Oberstar, told reporters, "If it's not in, I'm not supporting this package, and I'll bring a lot of votes with me."