Are They That Stupid? Someone Is, And It’s Bad News

Brad DeLong expresses doubt as to whether (as I noted earlier that the Evening Standard had reported) even the Bush administration could be quite dumb enough to be strong-arming US defense firms in hopes of getting them to close up shop abroad and bring jobs to the US:

I do not believe this. I cannot believe this. Incompetent, short-sighted, ungrateful, and mendacious as we all know the George W. Bush administration to be, even they wouldn't do something as stupid and counterproductive as this.

Would they?

I understand Brad's reluctance. Like him, I don't want to think that our leaders can be that dumb. And the Evening Standard is not the gold standard for reporting.

Trouble is, it's not that easy to figure out exactly whether the Director-General of the Confederation of British Industry Mr. Digby Jones actually said what was reported in the Evening Standard. The text of the speech doesn't seem to be online. I've e-mailed the Confederation of British Industry in the hopes they will send it to me.

In the mean time, we have to make do with the newspapers. The usually reliable Financial Times more or less echoes the Evening Standard. A Scottish paper suggests this isn't about private strong-arming so much as the “Buy America” campaign. And the Daily Telegraph says that the pressure came from Congresspeople — some of whom unquestionably are this stupid — and not from the White House. And, indeed, if you look at what the FT and ES actually say, they don't finger the Bush administration as such — just give the strong impression the Administration is the source of the pressure from the context, which is about Bush's visit.

But even if the pressure came from Bush's allies in Congress, instead of directly from the administration, this isn't good.

Start with the Financial Times, which is highly reliable. In Testing time for very special friends, the FT reports the various and growing US-UK tensions over Guantanamo and over economic relations, and then notes that,

there is deep suspicion in business circles these days of the extent to which the US is actually on the UK's side, a suspicion accentuated by the imposition of hefty protectionist tariffs on European steel imports.

The suspicion was all too evident yesterday at the annual conference of the CBI, the employers' body, where Digby Jones, director-general, made plain to delegates in Birmingham his concerns about the US.

“Three chief executives of American companies investing in Britain have told me to my face that they have been told to close down, bring their stuff home and make it in the US,” said Mr Jones. “Whether flouting international law with their steel tariffs or telling their companies to come home, this bullying affects Britain and British jobs. We are America's biggest trading partner but if this escalates it hits us worst because we are such a big player in the world market.”

The Herald, a Scottish newspaper, suggests the context for the quoted remark is the US's 'Buy America' campaign. (Update: As far as I know, while there are existing “Buy American” laws on the books, the attempt to toughen them in the 2004 Defense Authorization Act did not succeed. )

That's also the Daily Telegraph's line, with the added bit that the pressure came from Congress rather than the White House:

Mr Jones also said he knew of two US companies – one defence rated and one manufacturer – which were being pressured by US congressmen to move their UK operations to America.

He added that a third company from the defence sector had told him that one of its American clients had been told by the US Government to buy its goods from an American rival and it would refund the difference.

Mr Jones said he had urged Mr Blair to raise the “buy America” campaign with Mr Bush. He said: “This goes to jobs of ordinary skilled people in Britain. This will cause unemployment in Britain and this is from our best friend.”

So there seem to be two versions of this story, one awful, one just bad.

If the administration is behind this pressure, it's awful. But even if it's just Republican congressmen, it's bad. For whether this pressure comes directly from Bush or just from his domestic political allies who he apparently cannot control, just think about the message this story sends the world: If there is one government that supported Bush and gave him essential political cover over Iraq, it was Tony Blair's Britain. And this is what they get in return?

Imagine the effect on countries trying to decide whether to cooperate with us in the future.

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