A debate over buy-American provisions in the stimulus package before Congress has underscored long-standing tensions over using federal policies to protect U.S. jobs without incurring retaliation from the nation's trading partners.

The concern comes as the worldwide credit crisis has increased both the political appeal of protectionist policies and the warnings of some economists that a downturn in international trade could prolong the unprecedented economic downturn.

The initial version of the massive legislation that passed the House included a mandate calling for the use of American steel and iron in the infrastructure projects it would fund. House leaders declined to include more expansive language, supported by lawmakers including Rep. Tim Murphy, R-Upper St. Clair, that would have extended the buy-American requirement to other areas, including health care and information technology.

The House measure prompted John Bruton, the ambassador from the European Union, to send a letter to Congress, warning against what he characterized as its protectionist dangers.

"The European Commission is particularly concerned about the message such measures would send to the world, at a time when most countries are faced with the same situation of looking for best means to tackle the crisis," the envoy wrote, contending that such provisions could lead to "a spiral of protectionist measures around the globe that can only hurt our economies further."

Supporters of the House provisions were unmoved.

"The thing that's bogus about these complaints we're getting from Europe and Japan is that we buy $2 trillion in goods from them and the infrastructure part of the bill is something like $90 billion," said Rep. Mike Doyle, D-Forest Hills. "This is nothing but a huge media effort by these countries -- they're just maneuvering to get leverage for trade disputes."

When the measure first went to the Senate, some lawmakers supported still broader mandates to buy American products, adding the purchase of "manufactured goods" to the iron and steel product requirement.

The buy-American pressure came from a wide variety of manufacturers as well as some of the labor unions that worked to elect President Barack Obama. The American steel industry, which had boomed in recent years, has seen its sales plummet over the last year as the ripples from the economic downturn widened.

But other American firms that are dependent on export sales, including Caterpillar, weighed in on the other side, arguing that efforts to protect American jobs could backfire in curtailing U.S. firms' access to other world markets.

In an interview on Fox News, Mr. Obama said, "I think it would be a mistake -- at a time when worldwide trade is declining, for us to start sending a message that somehow we're just looking after ourselves and not concerned with world trade."

Sen. John McCain cited Mr. Bruton's warnings as he tried unsuccessfully to have the buy-American language removed from the legislation entirely. The Senate majority acted to defuse the potential confrontation by adding language that softened the impact of the requirement. On a voice vote, the lawmakers added the instruction that the buy-American rules should be "applied in a manner consistent with United States obligations under international agreements."

Some steel state supporters saw that as a reasonable compromise. "I think it addresses the concerns -- there's a provision for a public interest waiver," said Sen. Bob Casey, D-Pa. "I really characterize it as a victory; I think it's a good, sound position."

Opponents were not mollified.

"As we see it, the revised language is a step in the right direction, but it doesn't address the main concern -- the signal that this is sending to the rest of the world," said Mattiascq Sundholm, a spokesman for the Washington, D.C., office of the European Union.

"This sends absolutely the worst signal at a sensitive time for the American economy," John Murphy, president of the U.S. Chamber of Commerce, said in an interview with NPR.

The chamber has historically supported expanded trade. But another business group, the United States Business and Industry Council, which represents smaller manufacturers, was critical of the compromise language.

"This legislative caveat sounds humdrum, but it goes to the heart of whether the stimulus package will be effective," said Kevin Kearns, the group's president, in a statement last week.

"All these 'international agreements' include the production and job-destroying trade deals signed under the last two administrations. These shortsighted deals have helped addict our economy and consumers to foreign manufactured goods purchased courtesy of unsustainable foreign borrowing, thus helping to spark the current economic crisis to begin with."

The somewhat softened buy-American language remained in the legislation that the Senate hopes to approve tomorrow. But it, like everything else in the massive legislation, will be subject to change as the measure, after Senate approval, moves to a joint conference committee that will reconcile it with the House-passed stimulus bill.

The buy-American debate, while taking place in the shadow of the myriad other issues raised by the stimulus legislation, will be closely watched for evidence of the Obama administration's overall approach to trade.

During the primaries, Mr. Obama repeatedly denounced the domestic effects of trade pacts. He pledged to renegotiate the North American Free Trade Agreement with Mexico and Canada. In the early days of an administration preoccupied with an economic turndown, however, those issues have yet to ascend to the top of his agenda.