President Joe Biden promised Monday to harness the purchasing power of the US government, the world‘s largest single consumer of goods and services, to strengthen domestic manufacturing and create markets for new technologies.
The Democratic President signed an executive order aimed at filling loopholes in existing “Buy American” regulations that cover about a third of the $ 600 billion in goods and services the federal government purchases each year. The order will make all waivers more transparent and create a high-level role in the White House to oversee the process.
“I don’t buy for a second that the vitality of American manufacturing is a thing of the past,” Biden told reporters before signing the contract. “American production was the arsenal of democracy in World War II and must now be part of the engine of American prosperity.”
Biden reiterated plans announced during the campaign to replace the fleet of federal cars with US-made electric vehicles.
The revitalization of manufacturing, which accounts for about 12% of the U.S. economy, is an integral part of Biden’s broader drive to boost wages, create more union jobs, support minority companies, and strengthen U.S. supply chains, officials say of the White House.
Increasing U.S. manufacturing has proven to be a major challenge for previous administrations, including that of former President Donald Trump.
“America cannot stand aside in the race into the future. Our competitors are not waiting,” said Biden. “To make sure the future is created in America, we need to create not just today’s jobs, but tomorrow’s jobs and industries as well.”
Manufacturers have been attracted to lower wages and weaker environmental standards in China and other countries over the past few decades. This exodus has created critical loopholes that were exposed during the COVID-19 pandemic, for example in the manufacture of medical devices.
China overtook the US as the world‘s leading manufacturer in 2010 and was responsible for 28% of global production in 2018, according to the United Nations.
The AFL-CIO trade union federation welcomed Biden’s order.
“This contract is a good first step in revitalizing US manufacturing that Trump’s policies have not implemented in the past four years,” said Richard Trumka, president of the AFL-CIO.
Major US retailers, including Walmart Inc, have launched high-profile “Made in America” campaigns to subsequently attract foreign manufacturers.
Rebuilding supply chains and developing new chains are key to economic growth in the US, according to trade experts.
The U.S. trade deficit soared to $ 68 billion in November, its highest level in 14 years as companies stocked shelves with overseas goods and supplied domestic factories that relied on overseas parts, which offset a surge in exports.
Biden’s order instructs federal agencies to reassess the threshold for determining U.S. content to prevent companies selling to the government from importing mostly overseas-made and than U.S.-made goods after minor changes Selling items.
New percentages of required U.S. content will be set as a result of the process due to start Monday, officials said.
Canada, the US’s second largest trading partner, fears that Canadian companies and workers could endure the pain if trade relations between neighboring countries deteriorate.
“We are always concerned about ‘Buy American’ … sure it will be a very, very high issue on our agenda in our work with the Biden administration,” Canadian Treasury Secretary Chrystia Freeland told reporters in Ottawa.
When asked whether the Order would be viewed as protectionist, a Biden administration official said Sunday evening that it would fully comply with U.S. commitments under the World Trade Organization, and Washington would work with trading partners to enforce global rules to modernize.
(Except for the headline, this story was not edited by GossipMantri staff and published from a syndicated feed.)