Joe Biden takes over the “Made in America” dear to his predecessor, Donald Trump. The new President of the United States is to sign, Monday, January 25, a decree giving priority to American companies and products in contracts concluded with the federal state. This text aims to revive national production and preserve industrial jobs by increasing “Investments in manufacturing industries and workers in order to rebuild better”, according to senior White House officials.
Less than a week after his inauguration, Joe Biden continues to deploy his priorities through presidential decisions, even though his government team is still not in place. While Lloyd Austin, the defense minister, was confirmed by the Senate on Friday, key ministries, such as foreign affairs, are still awaiting their officials. The vote on the confirmation of Janet Yellen, the future Minister of the Economy and Finance who must steer economic projects, including the $ 1.9 trillion rescue plan to get the country out of the crisis, is scheduled for Monday.
The new decree should make it possible to reduce the possibilities of circumventing the rules requiring the federal administration to first buy products made in the United States. Particularly, Biden wants to limit the way federal agencies stamp “Made in America” the products they wish to buy, in order to eliminate legal loopholes exploited by companies that manufacture only a small part of them in the United States.
This decision echoes those of his predecessors and more particularly Donald Trump, who had encouraged, by decree, the federal state to buy more American products and made tariffs a weapon against imports, with uneven results.
Instead of a trade war, Joe Biden favors a toughening of the rules of “Buy American” and wants to use the federal government’s purchasing strike force. “The dollars the federal government spends (…) are a powerful tool in supporting American workers and manufacturers. Public procurement alone represents nearly $ 600 billion in federal spending ”, specifies an administration official.
Harden the “buy american”
The Buy American Act of 1933, still in force, obliges federal agencies to source primarily goods produced on American soil, but “These preferences have not always been implemented in a consistent or efficient manner”, according to the administration. The Biden approach must “Fundamentally change the structure of the process of the“ buy american ”processes”, in order to change the very definition of a product considered to be manufactured in the United States, and to tighten the possibilities of exemptions. The administration also wants new businesses, including small ones, to have access to tenders.
During the election campaign, Joe Biden had promised to toughen the “Buy american” with a $ 400 billion plan for projects using products made in the United States, including steel or protective equipment for healthcare workers fighting the Covid-19 pandemic. After his victory, he claimed that the federal government was going to buy American cars and inventory. However, companies have already warned that overly restrictive rules could cause costs to skyrocket, making it harder to purchase parts made outside the United States.
The decree must also “To be seen as only part of an overall commitment of this administration (…) to solidify supply chains ”, said one of Mr. Biden’s lieutenants. Washington highlights the shortages caused by Covid-19, which have shown the weaknesses of the system, and explains wanting to avoid being “Put in a position where we depend on countries that do not share our interests to deliver essential materials”.
The new president “Remains committed to working with partners and allies [des Etats-Unis] to modernize international trade rules (…) so that all countries can use taxpayer money to encourage investment in their own countries ”. A veiled way of attacking China whose products are flooding the world.
