Metro Magazine

SEP-OCT 2014

Magazine serving the bus and rail transit & motorcoach operations since 1904

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Policymakers are calling for tougher Buy America procurement rules, which largely ignore how the real marketplace works and could undermine the very employment opportunities that these proposals seek to expand. 12 < m ETRO m AGAZINE SEPTEMBER/OCTOBER 2014 metro-magazine.com BY CLIFF HENKE Buy America: nce again, a faction of Con- gress as well as adminis- tration officials, respond- ing to increasingly louder voices outside the indus- try, are calling for tougher Buy America procurement rules for public transpor- t at i o n e q u i p m e nt. A n d , once again, while on its face well-mean- ing, pro-jobs proposals largely ignore how the real marketplace works, and this weakness could undermine the very employment opportunities these pro- posals seek to expand. Worse, they could actually shrink them. This ar ticle w ill address the var i - ous proposals in detail, including their strengths and shortcomings. Before that, however, it is important to recap how we got where we are, including why U.S. policy has Buy America provisions in the frst place. BORN OUT OF THE GREAT DEPRESSION T he origins of public transporta- tion's Buy America policies date back to the New Deal in the 1930s. Unemployment in the U.S. rose to 25%, es of these materials by federal govern- ment programs, not to projects funded with grants to cities or states. While a few public transportation projects of the New Deal also were sub- ject to these narrow mandates, compli- ance was not raised as much of a prob- lem for the industry's suppliers at the time, including for rolling stock, trac- tion power and other systems needed. These sectors were as strong as any in America at the time. Indeed, this was the beginning of the era of the Electric Railway Presidents' Conference Com- mittee (PCC) cars. Nearly 5,000 PCC cars were built in the U.S. and Cana- da during the late 1930s, 1940s and the early 1950s, according to APTA. In ad- dition, many streetcar and bus compa- nies were owned by local electric utili- which was actually better than many countries in Europe, where unemploy- ment peaked at 33%, according to some histories of the episode. Heavy manufacturing industries were especially devastated, but so were agri- cultural sectors, which were also aggra- vated by the Dust Bowl droughts of the same decade. Te economy of the U.S. as well as other industrialized economies underwent massive restructuring, and employment did not return to pre-De- pression levels until World War II. Just as the New Deal program was being crafted to put Americans back to work, the Buy American Act of 1933 mandated that the steel, concrete and other basic materials used in federally funded projects be of 100% American origin. It applied only to direct purchas- O BUY AMERICA BUY AMERICA Just as the New Deal program was being crafted to put Americans back to work, the Buy American Act of 1933 mandated that the steel, concrete and other basic materials used in federally funded projects be of 100% American origin.

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