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Biden Strengthens Buy American Provisions

He says the move will create good paying union jobs in the United States

Brian Young's picture
Jan 25, 2021

Since Biden took office on January 20th, he has signed a number of Executive Orders (EO’s) to support America’s workers, including directing OSHA to create a COVID-19 safety plan and repealing Trump’s anti-union EOs. On Monday, Biden continued his torrid pace by signing an EO to strengthen the United States Buy American policy.

The EO will direct agencies to strengthen requirements about purchasing products and services from U.S. workers and businesses, cut some red tape, and creates a position in the Office of Management and Budget responsible for enforcing the directive, an administration official told reporters on a conference call Sunday. It also reiterates Biden’s support for the Jones Act, which limits foreign maritime shipping between US ports to US-made and owned vessels.

While the United States has had a Buy American policy, there have been many loopholes that allow companies to appear like they are buying American products but are really using foreign-made products. Some of the requirements haven’t been updated since 1954.

The EO will direct agencies to close current loopholes in how domestic content is measured and increase the domestic content requirement. This means that companies that want to do business with the federal government will need to increase the content of their goods that are made in the US. Right now, thanks to a loophole in the law, a product can be stamped made in America with just 51% of the materials being produced in the United States. The order also says that the federal government should prioritize US suppliers who are growing new sectors in the economy and companies that treat their workers “with dignity and respect.”

“This order is deeply intertwined with the President’s commitment to invest in American manufacturing, including clean energy and critical supply chains, grow good-paying, union jobs, and advance racial equity,” the White House said in a statement.

Biden also wants to bring new companies into working with the federal government. To do this, his order directs agencies to utilize the Manufacturing Extension Partnership- a national network in all 50 states and Puerto Rico, that supports small and medium-sized manufacturers- to connect with new suppliers who make their product in the United States.

With $600 Billion spent annually on federal government contracts, every extra dollar that stays in the United States is another dollar that supports good, union jobs in the United States.

“These investments will help create well-paid, union jobs, and build our economy back better so that everybody has a fair shot at the middle class,” said the White House. “They will buy from all of America—including minority entrepreneurs and businesses in every region in our country. And, they will support the manufacturing capabilities and technology needed to build a clean energy future and strengthen our national security, and give our workers and companies the tools they need to compete globally for decades to come.”

Strengthening federal contracting rules will also help create American jobs as Biden has proposed a $700 billion plan to “Build Back Better.” Of that $700 billion, $400 billion would be spent on buying US-made products and services to spur job growth and manufacturing. The other $300 billion would be spent on research and development, primarily in US technologies. Biden’s Build Back Better plan hopes to create 5 million jobs and reduce the United States' reliance on other countries for manufacturing. That reliance became a liability in 2020 when Americans faced a shortage of a number of products because they were only made overseas, including N-95 masks.

You can watch President Biden's remarks about the Buy American EO below.

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