California and the West : Chinese Steel Sparks Backlash in Capitol : Imports: Union’s complaint inspires ‘Buy American’ bill in Legislature. Some worry it could increase construction costs.
The sight of Chinese characters stenciled in yellow chalk on the side of heavy steel beams was enough to make Dick Zampa’s blood boil.
“Who in the hell in their right mind,” he fumed, “would have thought they were going to get this stuff from China?”
The “stuff” was steel. Tons and tons of steel destined for the underbellies of California’s toll bridges that the state is spending more than $2.5 billion to strengthen for earthquake safety.
Zampa, president of the District Council of Ironworkers, strongly supports the earthquake retrofitting program, but what set him on the warpath is that the steel for the job is being purchased from Shanghai Fastener Co., a Chinese supplier. Zampa says that the steel for America’s bridges should come from America’s steelyards.
His anger has sparked a revival of “Buy American” thought in the Legislature.
“When I first heard about it, geez, I was dumbfounded,” he said. “Most people I told about it couldn’t believe it either. They just assumed it [steel] was coming from here.”
Zampa’s union complaints caught the eye of Assemblywoman Patricia Wiggins (D-Santa Rosa). She quickly proposed a bill which, if passed this week, could have an enormous impact on the way the state builds public works and how much it spends on them.
The bill (AB 214) requires that steel and other materials purchased for California public works projects be produced or manufactured in the United States as long as the bid is no more than 25% higher than the lowest bid offering foreign products.
The measure has passed the Assembly 48-32 and is pending in the Senate.
“Buy American” laws were the rage in the 1940s and ‘50s when the free world feared envelopment by communism. But the state lost interest in the movement after a 1969 court decision invalidated the California Buy American Act, holding that it was an encroachment on the federal government’s foreign relations powers.
Legislative counsel Bion Gregory advised lawmakers that more recent decisions have upheld similar laws in other states, making it likely that a new “Buy American” bill would survive a court challenge.
The proposal has picked up stiff opposition in recent weeks from the California Department of Finance, which predicted that it could add millions of dollars in costs to public works projects.
Caltrans Director Jose Medina told lawmakers that American-made materials are used on most transportation projects because they are partially financed by federal funds that require the use of American-made materials. But he said no strings are attached to projects using only state funds.
He said the strengthening of toll bridges is being financed entirely with state money. This includes the Carquinez Bridge, a structure on Interstate 80 about 30 miles east of San Francisco that is being retrofitted by ironworkers from Zampa’s union.
Caltrans spokesman Jim Drago said when contractors use lower-cost foreign suppliers, the department monitors the manufacturing process and inspects the final product just as it would American-made materials. He said steel bolts supplied by Shanghai Fastener Co. were recently rejected because they did not pass tests for strength and toughness.
“We have a long-standing policy that we inspect and randomly test our materials. This is something we do whether the stuff is produced in Shanghai or Sheboygan,” he said. “We’ve had both good and bad experiences with foreign and domestic steel products.”
Tom MaCurdy, an economics professor at Stanford University, said “Buy American” is often popular because lawmakers believe it creates jobs and saves money, but in reality it does neither.
“It’s an income transfer. It isn’t making the pie bigger. It’s just redistributing it,” he said. “The main thing is, it’s not free money.”
When American products are used over cheaper foreign products, he said, the higher cost requires either more taxes or less spending on other programs.
He said the legislative push for “Buy American” is another example of the emerging political power of unions, which strongly backed victorious Democratic candidates in the recent elections.
“A year ago when we had a Republican governor, they wouldn’t have been talking about this,” he said, “because they would have known it was a waste of energy.”
But Zampa insisted that his campaign was sparked by patriotism, not union self-interest. “All those suppliers aren’t union outfits, but they’re American outfits. They’re taxpayers to our country and our state.”
