WASHINGTON, D.C. – U.S. Senator Tammy Baldwin (D-WI) is calling on President Donald Trump to expand and enhance federal Buy America rules to prevent Chinese attempts to enter U.S. infrastructure markets at the expense of American workers. Baldwin is also urging the President to increase federal assistance to state and local governments for infrastructure projects to prevent underbidding for infrastructure contracts by Chinese state-owned enterprises.
A recent report found that Chinese Communist Party officials viewed the Trump administration’s 2018 Rebuilding Infrastructure in America Plan as an opportunity for China to gain U.S. market share for its state-owned enterprises. The report also found Chinese officials gloating about circumventing Buy America rules at the state and local level by targeting U.S. communities with below-market bids on infrastructure projects. This comes as many state and local government budgets have been significantly weakened both by responding to the COVID-19 pandemic and dealing with fiscal budget shortfalls caused by the Republican-backed Tax Cuts and Jobs Act.
The report also indicates that the Chinese Globalization Think Tank recommended Chinese firms get around federal Buy America rules by putting assembly facilities in the United States. This practice has already taken place in the United States as a Chinese state-owned rail company successfully bypassed Buy America rules through completing vehicle projects in the U.S. at the local level.
In her letter to President Trump, Baldwin writes, “Chinese officials seem well aware of the impact of these interventions on U.S. industry, noting that American manufacturing companies may go bankrupt as a result of Chinese firms and capital entering the U.S. market for infrastructure.”
She continues, “As Majority Leader McConnell continues to delay action to provide funding to state and local governments on the frontlines of the COVID-19 response, Chinese officials plan to turn the COVID-19 crisis into an opportunity ‘to co-opt US infrastructure, supply chains, and markets’ by increasing overtures to cash strapped state and local governments. We cannot allow the division of partisan politics to open the door to further Chinese absorption of U.S. industrial capacity. Strong and flexible funding for our state and local governments is needed in the next COVID package, and real funding is needed for our state and local partners in surface transportation reauthorization.”
Baldwin concludes, “In closing, we again reiterate our requests. First, we ask that your infrastructure proposal include provisions to expand and strengthen Buy America rules in light of Chinese success at circumvention. Second, we ask that you and Senate Majority Leader McConnell work with House and Senate Democrats to provide funding to state and local governments facing shortfalls as a result of responding to the COVID-19 pandemic—including real funding in your surface transportation reauthorization proposal. Fulfilling these requests for the next infrastructure package will put Americans back to work and get our economy—which is still struggling from the pandemic—back on its feet by investing in American manufacturing.”
The letter was also signed by Senators Gary Peters (D-MI), Jeff Merkley (D-OR) and Bernie Sanders (I-VT).
The full letter is available here.