Big corporations are lobbying to make it easier to stamp "Made in America" on products that aren't.
Owen Herrnstadt at the Economic Policy Institute warns that businesses are urging the Export-Import Bank to weaken its domestic content requirements. That means companies are required to buy a certain percentage of material for their products domestically to get access to local markets or preferential treatment under trade laws.
Two-thirds of Americans say buying American goods is essential to keep good jobs. And three-fourths say a product must be manufactured within the U.S. borders if it's to be considered "American."
Given this consensus, it is ironic that on the same day that one federal agency extolled the virtues of U.S. goods stamped with Made in America, another federal agency issued a notice that it was conducting a review of its domestic content policies, and suggestions made by some businesses to reduce domestic content requirements—giving them greater incentives to Make it Elsewhere. It is even more ironic that the agency being asked to adopt these suggestions on weakening domestic content requirements is the United States Export-Import Bank, whose primary purpose is to support U.S. exports that create and maintain jobs here at home.
The Export-Import Bank’s mission, established by federal law, is clear: “The Bank’s objective in authorizing loans, guarantees, insurance, and credits shall be to contribute to maintaining or increasing employment of United States workers.” [12 U.S.C. Section 635(a)(1)]
The Bank fulfills its mission by providing U.S. exporters with more favorable financing than they could obtain privately, on the condition that they meet certain public policy requirements. One of these policies requires exporters to manufacture their product in the United States. The Bank’s policy is simple, effective, and based on common sense: If a company wants government support for its exports, it has to produce its goods and services in the United States. Taxpayers shouldn’t finance the use of foreign goods and services.Congress ordered the bank to review its domestic content policies. You know what happens next.
Some exporters want even more government support for the foreign goods and services in their products. Among other things, they suggest that Ex-Im promote a fiction that foreign content is domestic content. Many of their suggestions would give U.S. companies more incentive to ship U.S. jobs and technology to other countries and raise serious questions.That's not the direction the vast majority of Americans want to take.
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