Biden orders government to buy from U.S. manufacturers

President Joe Biden is directing the federal government to increase its purchases of U.S.-made goods, seeking to remove loopholes from an existing Buy American policy and follow up on his promise to help the nation’s beleaguered manufacturing industry.

The U.S. has lost about 540,000 factory jobs since last February, as the pandemic pummeled the nation’s economy into recession. The idea behind Mr. Biden’s executive order would in part be to use the roughly $600 billion the federal government spends annually on procurement to lift domestic manufacturing and employment.

“I don’t buy for one second that the vitality of American manufacturing is a thing of the past,” Mr. Biden said Monday in delivering remarks on his latest initiative. The prior administration allowed loopholes in the Buy American policy, the president stated. “This is different,” Biden said. The Biden administration will tighten the existing policies and broaden them, he said.

Mr. Biden’s order seeks to change the rules of the existing Buy American program, raising the bar for contractors to qualify for a waiver and sell foreign-made goods to federal agencies. It also stipulates that more of a product’s components originate from U.S. factories, and hikes the government’s threshold of how much more can be paid to buy U.S. goods versus foreign products.

The move calls for the creation of a public website of companies given exemptions to sell foreign goods to the U.S. government, giving American companies more information so they can better compete.  It also creates a position at the White House Office of Management and Budget to oversee the initiative and track whether progress is being made. 

The president’s move drew cautious praise from some quarters, with Public Citizen calling it a good first step, so long as the White House follows through on really ditching exemptions that allow many foreign companies to be treated as American for U.S. government purchasing needs, resulting in U.S. tax dollars getting diverted overseas.

“If the Biden administration’s planned stimulus funds are to be reinvested in the U.S. to rebuild our resilience and create jobs, then the massive trade-pact loophole to Buy American needs to be closed immediately,” Lori Wallach, a trade expert at Public Citizen, said in a statement. “Otherwise billions will leak out in offshored government procurement contracts.”

The Alliance for American Manufacturing also applauded Mr. Biden’s efforts, and urged specific steps. “It’s essential to close loopholes, reduce waivers, broaden coverage to more federal spending and more manufactured products, and strengthen origin standards,” Scott Paul, president of the group, said in a statement. “Stronger domestic content preference policies and a sizable new investment in infrastructure and clean energy will spur factory job creation and new investment in America.” 

— The Associated Press contributed to this report.