AS CONGRESSIONAL leaders work to reconcile House and Senate versions of the economic stimulus plan, President Barack Obama should work to remove "Buy American" provisions stipulating that iron, steel, or manufactured goods used in stimulus-backed projects be American-made. These proposals eerily echo passage of the Smoot-Hawley Tariff Act in 1930. Smoot-Hawley raised tariffs on imported goods to some of the highest levels in US history, sparked a global trade war that dealt a near-fatal blow to international trade, killed American jobs, and deepened the Great Depression. This is history to be remembered - not repeated.
Like Smoot-Hawley, the "Buy American" provisions in the economic stimulus plan are intended to help American workers and the US economy. However, they may spark retaliatory measures from other nations - also struggling under the weight of recession - thereby slowing a global economic recovery. The European Union is already threatening to strike back, and British Prime Minister Gordon Brown last week issued a public plea to Obama and Congress not to repeat the mistake of protectionism.
During times of crisis, the instinct to protect American workers is understandably strong, and the aim of the "Buy American" provisions is admirable. Yet, these proposals should be viewed in the context of Smoot-Hawley and the competing protectionist measures, which actually stymied job creation. Moreover, to view the US economy as independent of others is a mistake in this era of globalization. Measured against the worldwide financial system of the 21st century, the global economy of 1930 seems primitive and disconnected. Even then, the sequence of retaliatory moves against Smoot-Hawley decimated world trade. What will happen when current trading partners respond to these new measures with their own proposals to strengthen domestic economies at the expense of global commerce?
Economic nationalism is running rampant through parts of Europe, where oil workers in the United Kingdom are striking against the use of foreign labor, and Spain is offering cash incentives for legal immigrants to leave the country. If the United States, the world's largest economy, were to follow these trends, the global economy could unravel at a rapid pace, raising the cost of imports and slashing the rate of exports.
In Massachusetts alone, merchandise exports in 2007 accounted for $25.4 billion, with more than 28 percent of all manufacturing workers in the state dependent upon exports for their jobs. And Massachusetts exports continue to grow briskly, climbing 35 percent between 2003 and 2007. Export centers are spread throughout the state, and provide much-needed jobs not only to Greater Boston, but to Pittsfield, Worcester, New Bedford, and Fall River. The decline in exports that could result from an era of economic protectionism could have dramatic repercussions for blue-collar workers here, who are already struggling to maintain their jobs.
Free trade has long had its critics, but the continuing growth of exports in Massachusetts reveals an economic strategy that successfully produces and grows jobs in the state. Strong high-tech, medical device, and pharmaceutical sectors are consistently increasing their exports around the world, and Governor Deval Patrick has traveled to China to present Massachusetts as one of the world's innovation leaders in clean energy and life sciences. Patrick's refrain has been, "If we get this right, the whole world will be our customer."
By comparison, if Congress and Obama get this wrong, and give in to the protectionist pressure mounting for the "Buy American" proposals, then the more than 8,000 Massachusetts companies that export each year may be left without foreign customers. The stimulus bill has the potential to rebuild roads and bridges, schools, and the investment pipeline. It will be up to Obama and congressional leaders to ensure that it does not rebuild the barriers of global trade as well.
Paul Guzzi is president & CEO of the Greater Boston Chamber of Commerce. 
