Biden requires US-made steel, iron for infrastructure

WASHINGTON

The U.S. administration has taken a key step toward ensuring that federal dollars will support U.S. manufacturing - issuing requirements for how projects funded by the $1 trillion bipartisan infrastructure package source their construction material.

The guidance issued yesterday requires that the material purchased - whether it is for a bridge, a highway, a water pipe or broadband internet - be produced in the United States.

However, the rules also set up a process to waive those requirements in case there are not enough domestic producers or the material costs too much, with the goal of issuing fewer waivers over time as U.S. manufacturing capacity increases.

“There are going to be additional opportunities for good jobs in the manufacturing sector,” said Celeste Drake, director of Made in America at the White House Office of Management and Budget.

President Joe Biden hopes to create more jobs, ease supply chain strains and reduce the reliance on China and other nations with interests that diverge from America’s.

With inflation at a 40-year high ahead of the 2022 midterm elections, he is betting that more domestic production will ultimately reduce price pressures to blunt Republican attacks that his $1.9 trillion coronavirus relief package initially triggered higher prices.

Biden has said that the roughly $700 billion the government devotes annually to procuring goods is supposed to prioritize U.S. suppliers but regulations going back to the 1930s have either been watered down or applied in ways that masked the use of foreign imports.

The administration could not say what percentage of construction material for existing infrastructure projects is U.S.-made, even though the federal government is already spending $350 billion on construction this year. The new guidelines would enable government officials to know how many dollars go to U.S. workers and factories.

American manufacturers are about 170,000 jobs short of the 12.8 million factory jobs held in 2019, as manufacturing jobs began to decline before the pandemic began. But the U.S. has 6.9 million fewer manufacturing jobs compared with the 1979 peak, a loss caused by outsourcing and automation.