Made in the U.S.A.

TPJ - THE TUBE & PIPE JOURNALĀ® JANUARY/FEBRUARY 2004

January 13, 2004

By:

For many years I lived in Belvidere, Ill., home of what was then known simply as the Chrysler plant. The local United Auto Workers union prominently displayed a sign in the parking lot that said, "Foreign cars will be towed." Now that the plant, which builds the Dodge Neon®, bears the name DaimlerChrysler, I'm wondering—is the sign still there? Probably not.

When I lived in Belvidere, there was a "Buy American" mentality. At that time manufacturers, particularly those in the automobile and electronics industries, were concerned about the Japanese making inroads into the U.S. economy. Japanese companies were producing high-quality, cutting-edge products that received high marks in consumer ratings. "Made in Japan," which at one time in the U.S. was synonymous with poor quality, suddenly became the preferred stamp for many U.S. consumers who believed that the Japanese-made products surpassed those made in the U.S. in terms of quality and reliability.

Now it's no longer just cars and electronics. We've seen a mass exodus of U.S. manufacturing, garment production, and even customer service jobs to Mexico, China, India, and other countries, and imports abound. It's becoming more and more difficult to find U.S.-made products and receive U.S.-based service.

A Major Problem — Here and Abroad

The last three years have been disastrous for manufacturing, and not only in the U.S. Other countries are facing the same problems. David Brazier, a technical director for a U.K. company who formerly worked in the U.S., responded to a fabricator.com newsletter question asking what could be done to help manufacturing.

"In the U.K. we see the same trends, the same fears expressed, and the same comments [as in the U.S.]. 'It's the greedy company bosses; it's government legislation; bring in trade barriers to protect what's left.'

"Greedy bosses? Yes, greed does exist, but in many cases, it's a question of survival. There always is a temptation to import and make a quick and easy buck rather than stick with domestic manufacturing, but if your competitors are importing cheaper products, and you cannot compete with local manufacturing, what option is there but to follow the trend? You cannot go on producing a product if there is declining demand.

"Trade barriers? As a short-term fix, they may work, but introducing trade barriers is a double-edged sword that simply blocks U.S. imports as well as reducing choice. Many U.S. companies have a very healthy export market, and some imports may well help a company stay competitive. A free market works both ways."

So what can we do? Brazier believes a collective effort by consumers and companies is the answer. "Factories can produce and keep people employed only if there is a demand for what they produce. As a consumer, what you buy may well affect your neighbor's manufacturing job and what he buys may affect your job. The very people who complain about job losses are the ones who go out and buy shoes made in China, who buy stereos made in Taiwan, and who have imported sedans sitting in their garages."

Brazier does not suggest that everyone blindly buy products made in his or her native country. "If a foreign product provides an edge, then buy it. The problem occurs when consumers either do not take the time to find out if a domestic product exists, or worse, simply buy an import because it's an import.

"It's ironic that U.S. consumers look with disdain at some U.S. products in favor of the foreign import when the same U.S. product is looked upon as the must-haveproduct in an export market! Interestingly, this problem seems more acute in the U.S. and the U.K., where an import often seems to take priority over a domestic product either on the grounds of lower price or as a status symbol. In France, by comparison, where consumers generally tend to be more patriotic, industries still survive that have long gone in the U.K.

"Manufacturing cannot survive on public support alone; many manufacturing sectors are stuck in a time warp — companies that think they can go on manufacturing as they did in the '60s, churning out the same products, where automation does not exist, where best practices are not followed, and where poor design and quality continue."

Buying Domestic

Say you're willing to do your part and buy products made in your country. As a U.S. citizen, you'll look diligently for items stamped "Made in the U.S.A." However, you can't rely on the stamp alone. Products bearing the stamp may contain parts made in several countries besides the country of origin and legally bear the stamp, if the percentage of the product made in the U.S. meets guidelines. Some unscrupulous companies, hoping to capitalize on the "Buy American" fervor, may promote a product as "Made in the U.S.A." when it isn't, and get away with it until caught.

What the Guidelines Say

A Federal Trade Commission (FTC) alert released in October 2001, "Selling 'American-Made' Products? What Businesses Need to Know About Making Made in U.S.A. Claims," stated, "Consumers who see 'Made in U.S.A.' on a product expect the claim to be truthful and accurate. Since the terrorist attacks of Sept. 11, news reports suggest that consumers are more sensitive to 'Made in the U.S.A.' claims and more interested in buying American-made goods."

According to the FTC, "Made in U.S.A." means that "all or virtually all" of the product has been made in America. That is, all significant parts, processing, and labor that go into the product must be of U.S. origin. Products should not contain any – or only negligible – foreign content. The FTC's Enforcement Policy Statementand its business guide Complying With the Made in U.S.A. Standard, detail the standard and give examples of situations when domestic-origin claims are accurate and when they are inappropriate.

Unless the product is an automobile, textile, or wool product, there's no law that requires manufacturers and marketers to make a "Made in the U.S.A." claim. If a business chooses to make the claim, the FTC's "all or virtually all" standard applies.

All textile and wool products, domestic and imported, must be labeled to identify the country where they were processed or manufactured. Products made in the U.S. of imported materials must be labeled to show the processing or manufacturing that takes place in the U.S., as well as the imported component. Products manufactured in part in the U.S. and in part abroad must identify both aspects. Also, print and online catalogs must disclose whether a textile was made in the U.S., imported, or both.

The American Automobile Labeling Act enacted by the U.S. Congress requires that each automobile manufactured on or after Oct. 1, 1994, for sale in the U.S. bear a label disclosing where the car was assembled, the percentage of equipment that originated in the U.S. and Canada, and the country of origin of the engine and transmission.

The FTC encourages anyone who suspects that a product promoted as "Made in U.S.A." is not American-made or contains significant foreign parts or processing to file a complaint with the FTC by calling the U.S. Customs Service Commercial Fraud Hotline, 1-800-ITS-FAKE.

U.S. Brand Doesn't Necessarily Mean U.S.-Made

When researching this article, I decided to look back at my family's holiday purchases to determine how many of the items were made in the U.S. This exercise was a real eye-opener.

The stainless steel teapot I gave my daughter was made in Thailand for an Illinois-based company. Kitchen knives from a company that began in 1900 on Manhattan's Lower East Side were made in China, as was the griddle from an Illinois-based company.

The candles and bubble bath I received as gifts all said they were made in the U.S.; the cute containers they were packaged in were made in China. The books I received were printed in the U.S.

At the after-Christmas sale at a major department store, my husband made his way to the shoe department to buy what he calls "the most comfortable shoes ever." The manufacturer began business in Massachusetts in 1971, and it's Web site names notables who wear the shoes, including former President George Bush. The shoes were made in Indonesia.

While my husband was in the shoe department, I stopped by the women's coat department. Coats were half-price, and I had a coupon for an additional discount. They were such a bargain, that I bought two coats. One was made in Vietnam, and the other was made in Thailand for a company whose Web site says, "From its original Pennsylvania and New York locations, [the company] has grown to include warehouses and offices in Canada, Mexico, New Jersey, Tennessee, Texas, Delaware, North Carolina, and Virginia. By the end of 2000 the company employed over 13,000 full-time and 4,000 part-time people worldwide."

Becoming a Smart Shopper

I'm dismayed that you can buy what you think is a longtime U.S. brand — something that at one time was produced in the U.S. — and end up buying a product produced in another country by non-U.S. labor. Clearly, I have to begin reading labels more closely if I want to support companies that still produce U.S.-made products. And I have to research more closely unlabeled products, and verify "Made in U.S.A." claims. With the amount of research required, is it any wonder that more people don't make the effort to buy U.S.-made products?

In this electronic age, there are Web sites designed to help you "Buy American." One is BuyAmerican.com, an online store that features 27,600 products and 600 vendors. Another is usstuff.com, which has a lot of information about products and includes the disclaimer: "Product price, features, content, description, country of origin, etc., may change and/or vary. Sometimes U.S. Stuff gets it totally wrong. Always verify before ordering. Always verify after receiving. Always check the labels."

Howtobuyamerican.comoffers books and products intended to help those who want to buy American. Its home page also includes a link to a Business Weekarticle that predicts that "Buy American" will become a serious political movement again.

This is a prediction I'm hoping comes true and one bandwagon I'm jumping on. Care to join me?



FMA Communications Inc.

Vicki Bell

Web Content Manager
FMA Communications Inc.
833 Featherstone Road
Rockford, IL 61107
Phone: 815-227-8209

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