The WasteWatcher: The Staff Blog of Citizens Against Government Waste

"Buy America" Rips Off America

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


“Buy America” provisions have been insterted into legislation, especially defense bills, for many years.  Usually, such provisions are removed from the final version of the defense legislation.  That happened late last year, when Senate leaders and administration officials convinced House Services Committee Chairman Duncan Hunger (R-Calif.) to drop the provision from the fiscal 2006 Defense Authorization Act, which was then signed into law by President Bush.  The Buy America clause would have blocked the Pentagon from buying military equipment from international companies that receive government subsidies.  The removal of this language constitutes a victory for taxpayers and national security.  More competition in Defense procurement can only result in better value for taxpayers and improved equipment for military personnel. 

Lawmakers said that one of the provision’s aims was to help Boeing regain a contract to supply refueling tankers to the Air Force.  In 2001, Boeing was awarded the $23.5 billion contract to lease 100 refueling tankers to the Air Force.  The lease deal was unusual, as the government usually purchases such military equipment outright.  The lease would have cost taxpayers more money in the long run.

A three-year investigation revealed that Boeing had hired a top Air Force acquisitions official – Darlene Druyun – who later admitted giving the company preferential treatment while she worked at the Pentagon.  The cost and corruption led congress to nix the contract in 2004.  CAGW was one of the deal’s earliest and harshest critics, calling it a taxpayer-funded bailout of Boeing’s line of 767s. 

The Boeing tanker lease scandal showed that depending on a small number of contractors ties the government’s hands in cases of corporate malfeasance.  The trend toward consolidation leaves the government with fewer domestic alternatives if contractors waste tax dollars or violate ethics rules.  Foreign companies and foreign-domestic partnerships are essential for keeping competitive pressure in some areas of defense acquisition.

Foreign companies like European jet maker Airbus, which has partnered with Lockheed Martin, can now compete for military contracts, but that does not necessarily mean they will win.  Competition is essential for keeping prices affordable, holding companies accountable for ethical lapses, and spurring innovation.   

In the wake of Congressman Randy “Duke” Cunningham’s resignation and the Jack Abramoff lobbying scandal, it would be unwise to give too much leverage to any single company.  The Buy America provision in the 2005 Defense Authorization bill was just another avenue for members of Congress and government officials to funnel tax dollars to favored groups and special interests.  Any future attempts to “Buy America” should be rejected. 

  -- De'Andre Anderson

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