BARACK OBAMA: THE DEPRESSION PRESIDENT

The recent news that U.S. public works projects funded by the stimulus package will be required to use only U.S.-made iron and steel was not entirely unpredictable. On issues of trade, the Democrats are bad for Canada, and by extension global trade. If Barack Obama lets this stand he risks becoming known as the Depression President. Thus far, the temptation among nations to shield their economies from the ravages of the global credit crisis has largely been limited to backstopping their financial sectors or bailing out struggling industries such as autos

To be sure, these efforts are at root protectionist, but it is still possible to believe that the primary intention is not to beggar thy neighbour.The recent U.S. stimulus package approved by the U.S House of Representatives rips away any pretense of adherence to the principles of free trade. It is as if the legislators slept through their history lessons on the catalytic role of the Smoot-Hawley Act in the Great Depression. So instead of standing up to the entreaties of Big Labor, Congress now looks to it for its marching orders. Sherrod Brown, an Ohio Democrat, told reporters.

Fortunately, Obama is on record as being opposed to protectionism: By a cruel irony, President Obama used the steel business as an example of the futility of protectionism in his book
The Audacity of Hope, where he wrote that "A tariff on imported steel may give temporary relief to U.S. steel producers, but it will make every American manufacturer that uses steel in its products less competitive in the world market."Encouragingly, even Iggy sees the threat, although Jack remains true to form. We can only hope that there is substance behind Obama's rhetoric. Otherwise, things are going to get a lot worse.