Protectionism = Economic Crack Cocaine

WASHINGTON (Reuters) - Dallas Federal Reserve President Richard Fisher warned on Monday against “Buy America” provisions in a proposed fiscal stimulus law and said it could lead to devastating trade protectionism.

“Let me just be blunt. Protectionism is the crack cocaine of economics. It may provide a high. It’s addictive and it leads to economic death,” Fisher told C-Span television in an interview for its “Washington Journal” program.

President Barack Obama seeks a $825 billion stimulus plan to end the country’s yearlong recession. U.S. lawmakers are debating rules that will insist that public money is spent on U.S-made products, although the White House has already said it will review any Buy America provisions.

“We just cannot afford to go down that path and I hope our senators, Democrats and Republicans, will be very sensible on that front,” said Fisher, who is not a voting member of the Fed’s policy-setting committee this year.

“Our job is to maintain price stability while we engender the growth and employment of the United States … It is a very difficult balancing act, but it can only be done if it is buttressed by sensible fiscal policy,” Fisher said.

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Comment by The Business Protection man

2009-02-03 11:00:46

Sadly this is the way things are going in the UK too. When the world is in depression everyone will have to look to themselves if protectionism is to take hold, rather than just blaming the bankers

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