COMMITTEE on WAYS and MEANS

Chairman Dave Camp

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Roskam - An Idea of Obama: Stimulus that is Both Sustainable and Free

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Washington, Mar 5, 2009 | comments

In the aftermath of the approval of an $800-billion spending bill masquerading as economic stimulus, many of us in Congress concerned about the exponential growth of the national debt are wondering if U.S. House Speaker Nancy Pelosi has even slightly considered common-sense policy alternatives before squandering precious taxpayer dollars. 

President Barack Obama’s recent visit to a Caterpillar plant in Downstate East Peoria highlighted the fact that the answer to the above question is a resounding “no.”

Caterpillar recently shed about 20,000 jobs amid the global construction slowdown. Unlike many competitors, Caterpillar has retained much of its manufacturing capacity in the United States, providing high-paying jobs in Illinois. This despite the fact that a large part of its sales come from outside the United States.    

Many of Caterpillar’s largest customers are in Colombia, such as the Pribbenow mine, home to some 250 Caterpillar machines, including 75 D-11 track-type tractors. There are more of these tractors, which are the largest in the world, in Pribbenow than anywhere else. They are all manufactured in Illinois. 

Unfortunately, Ms. Pelosi has chosen to convince the American people of the stimulative impact of programs to save the habitat of a San Francisco Bay area salt marsh mouse instead of saving thousands of jobs in Illinois with one vote in the House of Representatives. Were the Colombia Free Trade Agreement to pass Congress, it would remove tariffs on American goods sold in Colombia and lower the price of Caterpillar’s equipment by 10%, making it easier for Colombian customers to afford more equipment and allowing Caterpillar to retain some of its manufacturing workforce.

Caterpillar pays an average of $200,000 duty for each large off-highway truck it sells in Colombia—that is about five jobs lost to completely unnecessary tariffs.

Another example of how to save jobs lies with the automotive industry. Passage of the Colombia Free Trade Agreement would eliminate the tariff on U.S. autos and lower the price of American automobiles in Colombia by 35%, at no cost to the taxpayer. The Chicago area is home to dozens of manufacturers that supply parts to the Big Three in Detroit.

For the past two years, as our economy has shed jobs, Ms. Pelosi has refused to allow the Colombia FTA to come to a vote. The agreement would save or create thousands of U.S. jobs—many in Illinois. Currently, 91% of Colombian goods enter our country tariff-free.

I hope that Mr. Obama’s visit to Caterpillar, one of the companies that stands to gain the most from passage of the Colombia FTA, signals a new willingness by Democrats to give this trade agreement a chance to save American jobs.

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