Millions of stimulus dollars are being spent on foreign-made traffic lights

Posted by Anonymous on 10/18/2011

In order for federal stimulus dollars to create American jobs, they must be spent on American-made goods. The multiplier effect of buying American-made is undeniable, and nowhere should this practice be adhered to more than in the sourcing of materials for stimulus projects intended to kickstart the economy. 

Unfortunately, this is not always the case.

According to the Pittsburgh Tribune-Review, due to a loophole in the “Buy American” clause of the American Recovery and Reinvestment Act of 2009, tens of millions of federal dollars are being spent on replacement street and traffic lights made overseas.

The energy efficient LED lights being used to replace antiquated street and traffic signals across the country are largely being sourced from abroad due to a clause in the stimulus legislation that states that “components and subcomponents of green-energy products need not actually be U.S.-made.”

As the Tribune-Review reports,“Because of shortages of American-made LED parts, several companies bidding specifically on street light replacement projects acknowledged to the Trib that their products would be better labeled 'assembled in America' than 'made in America.'"

And why are there so few American-made LED options? Because American manufacturers are up against Chinese imports subsidized by Beijing:

“Chinese officials decided two years ago to phase out making compact florescent lamps because they considered LEDs to be the future of lighting, according to a report this year by the Swedish Energy Agency and the National Lighting Test Center in Beijing.

To do that, the Chinese government began providing subsidies to attract manufacturers of semiconductor wafers. More than 60 LED package producers are located in the People's Republic, as well as 2,500 companies that fabricate finished LED lighting fixtures, according to the report.”

This is bad news for American manufacturers who would like to break into a booming industry—and whose products could be sourced for stimulus projects. As one LED industry expert put it, "I watched us invent LEDs. We gave it away."

Read more form the Pittsburgh Tribune-Review.

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