Buy American

The limits of global commerce that appeared here and there during the height of the crisis would be ebbing. The specter of protectionism would retreat from the G20 countries, which groups the “old” (United States of America, Europe, Japan) and the “emerging” (notably Brazil, India and China) economic powers. At least, that’s what is argued in an evaluation report, published by the World Trade Organization (WTO) on Monday, March 8th. Twenty-four hours later, we’re tempted to be less categorical than the WTO, and to point fingers at the bad examples set by the United States.

First of all, there is the manner in which Toyota has been treated in America. Required to recall millions of vehicles for serious technical defects, the Japanese automobile company was publically humiliated in Washington. It wasn’t too far from “Nippon bashing,” an anti-Japanese attitude, when the heads of Toyota were made to bow their heads and apologize before the congressional committees. And we are not necessarily jumping to conclusions if we consider that the whole affair works in the favor of General Motors, the grandfather of the American automobile industry, 60 percent of which is owned by the government.

Early in the week, a senior European Union official stressed the persistence of the “Buy American” climate across the Atlantic. His opinion was confirmed in the most recent episode in the ongoing saga surrounding the Pentagon’s renewal of its fleet of tanker aircraft. After 10 years of submitting to different calls for tender put out by the U.S. Department of Defense, the European group EAGS, partnered with American firm Northrop-Grumman, announced that it was throwing in the towel. Boeing is left as the only candidate.

This is not without any objective reasoning. The American aerospace corporation today proposed a more modest tanker, with a lower price than that offered by EADS-Northrop. Considering the crisis, price has become the determining factor in a situation in which Congress has intended to cut back on defense costs. That said, we still should not forget two things: first, U.S. Secretary of Defense, Robert Gates, had publically stated that the plane submitted by EADS-Northrop is far superior to that submitted by Boeing, and second, the call for tender had been rewritten at the request of Democrats, and in a way that would favor the American company…

Should we be concerned about the number of barriers to Montesquieu’s beloved “sweet trade”?