'Buy American' clause stirs up controversy

The stakes can be seen in individual communities. Steel plants across the rust belt are feeling the effects of the depressed economy and auto industry meltdown. An ArcelorMittal plant in Burns Harbor, Ind., is representative. Last year, the company and USW agreed on a plan to avoid involuntary layoffs of up to 2,400 workers with some voluntary pink slips and a shortened workweek.

"These plants certainly can produce the steel necessary for infrastructure," says Robinson, director of the USW's District 7, representing about 70,000 workers in Illinois and Indiana.

ArcelorMittal spokesman Bill Steers declined comment on the "Buy American" measure's impact.

About 200 miles southwest of Burns Harbor is a Caterpillar factory where roughly 3,500 other Midwesterners could be hurt by the potential boomerang effect of new domestic content legislation. The company's Decatur, Ill., plant produces heavy equipment for customers all over the world. About 80% of its output is exported, including massive mining trucks used in Canada's Alberta oil sands development.

"The world economy is at a tipping point. If the U.S. embraces protectionism, it will send a signal that will be hard for anyone to resist," says Bill Lane, Caterpillar's head of governmental affairs.

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