I read with some interest today the Senate’s Friday, Jan. 16, dialogue on approval of the Keystone XL Pipeline, specifically with regard to three pending amendments to S. 1. One of these amendments, introduced by Senator Al Franken (D-Minnesota), would require that all of the iron, steel and manufactured goods that are used to construct the pipeline and its facilities be produced in the U.S.
While “Buy American” provides a useful soundbite for elected officials, the Water and Wastewater Equipment Manufacturers Assn. and others in the manufacturing community and beyond understand that behind those simple two words lurks a plethora of unintended consequences. For example, this language has the potential to: 1) disrupt longstanding supply chains; 2) increase project costs; 3) create monopolies; 4) stifle innovation; and 5) lead to retaliation and trade restrictions by some of our leading trading partners such as Canada, Mexico and the European Union.
The “glimmer of hope” stems from comments made by U.S. Sen. Lisa Murkowski (R-Alaska), who opposes this amendment. While she acknowledges the importance of encouraging more jobs and job creation in the U.S. and she buys American-made products whenever she can, she does not agree that the role of Congress is to mandate specific materials for the Keystone XL Pipeline. She noted that, without Congressional mandate “fully 75% of the pipe from this project is going to come from North America.” Those commitments were already made three years ago. More importantly, she understands that the Keystone XL Pipeline is a privately-funded project—it receives no Federal subsidies or taxpayer dollars and mandating the source of materials would be precedent setting.
She even went so far as to ask the Congressional Research Service (CRS) to find any examples in which Congress sought to force or direct private parties or a private company to purchase domestic goods and materials. So far, the CRS has not been able to uncover any examples. In her words, “This potentially puts us on a pretty slippery slope. If Congress mandates this for pipelines, why not other energy sources such as wind turbines? Why not our vehicles? Why not everything?”
Why not, indeed! I applaud Sen. Murkowski for the wisdom and courage to think independently and ask the questions that need to be asked. I certainly hope the rest of her esteemed colleagues in Congress will listen.
UPDATE: Just before press time, Sen. Murkowski moved to table Sen. Franken’s amendment. Her motion passed, 53 - 46, cutting off all debate on the amendment and defeating the amendment.
Vanessa M. Leiby is executive director of the Water and Wastewater Equipment Manufacturers Assn., a Washington, D.C.-based trade organization that has represented the interests of manufacturers serving the water supply and wastewater treatment industry since 1908. Leiby can be reached at [email protected].