As the U.S. continues to deal with the coronavirus, Senate Republicans have recently put together new legislation aimed at bringing more aid to the American people. Although one of the bill’s provisions would provide another round of $1,200 checks to many Americans, the $1 trillion HEALS Act does a lot more than hand out checks. The bill addresses things such as tax certainty for remote workers, expanded relief for small businesses, and enhanced fiscal responsibility via trust fund review. Sadly, no crisis is put to waste in Washington, as the bill also contains various extraneous provisions like excessive agriculture spending, billions in defense programs unrelated to the virus, and other pet projects. Chief among these wasteful provisions is the US MADE Act, championed by Sen. Lindsey Graham (R-SC). This provision would waste taxpayers dollars and put more strains on global trade, likely leading to higher costs for taxpayers.
The US MADE Act would require the Department of Health and Human Services (HHS) to purchase certain personal protective equipment (PPE) and other medical supplies domestically. These items include but are not limited to sanitizing supplies and ancillary medical supplies such as disinfecting wipes, privacy curtains, beds and bedding, testing swabs, gauze and bandages, tent, tarpaulins, covers, or bags. While there are legitimate concerns with the Strategic National Stockpile of PPE and other medical supplies, it makes no sense during a pandemic and economic downturn to require that these items solely be purchased domestically.
Although the costs of such protectionist measures are often difficult to calculate, it can be said with certainty that requiring the government to purchase domestic PPE would increase costs at the taxpayer’s expense. It is estimated that U.S. import taxes now cost the average American household $555 per year. Unless we address the costs associated with these protectionist policies, elected officials will have no reservations enacting such policies that benefit the politically connected at the expense of taxpayers at large. In addition to the costs, what makes this policy so misguided is the fact that there is little evidence to support the claim that the United States is dependent on foreign suppliers. In fact, more than 60 percent of medical supplies are made in the United States. China accounts for only 2.1 percent, leaving non-China imports at 37 percent.
Luckily, support for free trade has recently increased to historically high levels, in spite of protectionist proposals from some lawmakers across the ideological spectrum. Moving forward, taxpayers should pressure their elected officials to reject protectionism in favor of pro-growth free trade policies. At the very least, such policies should be addressed individually, and should not be hidden in a CODIV-19 relief package.