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The Biden administration announced Wednesday plans to introduce the “Make Buy American Real” rule that it says will advance the White House’s commitment to “ensuring the future of America is Made in America.”
“Made in USA” tags are, of course, ubiquitous in various department stores and home improvement retailers. But the tag may not always tell the entire story.
The administration pointed out that for products to qualify as American-made, just 55% of their parts need to be manufactured in the states. Part of the proposal is to move that threshold to 60% “and a phased increase to 75%.”
Another part of the initiative is to shore up the U.S.’s domestic supply chain by proposing “enhanced price preferences to select critical products and components.
“These preferences, once in place, would support the development and expansion of domestic supply chains for critical products by providing a source of stable demand for domestically produced critical products,” the administration’s statement read.
An administration official called the proposals a “bold action” from Biden, who signed an executive order during the first days of his presidency that aimed to boost government purchases from U.S. manufacturers.
The order modified rules for the Buy American program, making it harder for contractors to qualify for a waiver and sell foreign-made goods to federal agencies. The White House said at the time that the executive action will ensure that “the federal government is investing taxpayer dollars in American businesses — both small and large. 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.”
The Biden team also wants to increase transparency in Buy American rules that are already in place. Contractors, for example, are only required to inform the government “if they meet the content threshold rather than reporting the total domestic content in their products.” The administration believes an improved reporting system for critical products can help fund American jobs.
The administration said the reforms came after a month of over “a dozen roundtables with business associations, small businesses and labor unions.”
The federal government will also leverage its purchasing power to “shape markets and accelerate innovation is a key part of the industrial strategy to grow the industry of the future and supporting U.S. workers community as part of the whole of government initiative,” an administration official said.