Barack Obama supported a “Buy American” campaign while running for the White House and even distributed campaign buttons and flyers with a special emblem declaring his support.

But now, as the US Senate moves today to vote on a proposed $1 trillion economic stimulus law backed by the President, there is rising concern the protectionist Buy American provisions in the bill could trigger a disastrous transatlantic trade war.

The American trade unions which enthusiastically backed Mr Obama’s economic platform on the campaign trail are demanding payback in the form of protectionist provisions that will ensure the largest government spending programme in history is focused almost exclusively on US manufacturers.

Democrats in the Senate have responded to public pressure to safeguard American jobs by stuffing the package with even more Buy American regulations than members of the House of Representatives had sought. The Senate is demanding that federal money for federal projects is only spent on goods and services made by US producers.

The Vice-President, Joe Biden, added to international concerns when he said: “I don’t view [the Buy American provisions] as some of the pure free-traders view it, as a harbinger of protectionism.” Last week the House of Representatives version of the bill stirred alarm in the EU and Canada by demanding that all iron and steel bought to rebuild the country’s crumbling infrastructure has to be American made.

http://www.independent.co.uk/news/world/americas/lsquobuy-americanrsquo-bill-risks-trade-war-and-drift-to-protectionism-1543707.html