US President Joe Biden signed an executive order on 25 January directing US government agencies to increase their adherence to “Buy American” requirements.
The US government spends almost USD600 billion a year on goods and services. (Credit: Getty Images)
“With this order, President Biden is ensuring that when the federal government spends taxpayer dollars, they are spent on American-made goods by American workers, and with American-made component parts,” the White House said in a statement.
While the existing federal law requires agencies to give preferences to American manufacturers when buying goods and services, those preferences “have not always been implemented consistently or effectively”, the statement said.
The order will create a review process to prevent “unnecessary waivers” of “Buy American” requirements. Biden said agencies have been waiving those requirements “with impunity”.
The order also directs agencies to close “loopholes” in the measurement of domestic content. The existing law establishes a domestic content threshold, or the amount of a product that must be made in the United States to be considered American.
“For example, right now, if you manufacture a vehicle for the federal government, you need to show that at least 50% of the components of that vehicle were made in America,” Biden said. “But, because of loopholes that have been expanded over time, you can count the least valuable parts as part of that 50% to say ‘Made in America’, while the most valuable parts – the engines, the steel, the glass – are manufactured abroad.”
The executive order calls for a new director of “Made-in-America” at the White House Office of Management and Budget (OMB) to oversee its implementation.
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