Green Jobs and "Buy America" Laws

The Wall Street Journal explains why "Buy America" provisions and domestic preferences will likely be integral to making sure the green energy revolution actually happens in our country - and isn't outsourced:

Congress is beginning to fear that the Obama administration's push for renewable energy will produce more jobs in Asia and Europe -- where most wind turbines and solar panels are made -- than in the U.S.

The proposed remedy is a provision in the economic-stimulus bill that offers tax breaks to U.S. producers of the equipment.

Sen. Jeff Bingaman (D., N.M.), chairman of the Energy and Natural Resources Committee, is urging support for a provision in the Senate version giving a 30% tax credit to companies that expand or build U.S. manufacturing facilities geared to renewable energy, clean transportation or electric-system upgrades.

"Several of us have come to recognize that we've outsourced the very things we're going to need to change the nation's energy mix, and this is a way of encouraging more manufacturing here at home," Mr. Bingaman said.

The situation highlights a weak link in U.S. industrial policy: Although tax credits are offered to those building renewable-energy projects, there are no comparable incentives for domestic equipment makers.

Oddly, tax credits for domestic manufacturers - as opposed to Buy America laws - aren't portrayed as "protectionism" even though they are just as much a subsidy as targeted procurement policies. I'm not quite sure why that is.