19 April 2017

News Story: Trump 'Buy America' order could drive costs in defense supply chain

US President Donald Trump
By: Aaron Mehta and Joe Gould

WASHINGTON – With a swipe of a pen Tuesday, President Donald Trump issued a new executive order directing the federal government to reemphasize “Buy American” laws – a move which analysts say could impact the existing supply chain for the U.S. defense industry. 

The order is focused on tightening the process under which all federal agencies – including the Defense Department -- get waivers from the 1933 Buy American Act. It would also create a series of reviews of America’s policies and reforms of the H-1B visa program. 

The core of the document involves the creation of a 150-day review period, wherein agencies will have to asses how well they follow applicable Buy American laws and whether they are relying too much on waivers for goods that could be produced domestically. During that same time period, the Secretary of Commerce and the United States Trade Representative will look over various free trade agreements and the World Trade Organization Agreement in order to judge their impact of Buy American laws. 

Those reports will be worked together into a final report to the White House on the implementation of Buy American laws, within 220 days of the EO being issued, a report that will become an annual requirement going forward. 

At least one Senate Democrat welcomed the executive order. Sen. Chris Murphy of Connecticut has claimed that the DoD, the largest purchaser of manufactured goods in the world, has spent nearly $200 billion on manufactured goods made by foreign companies in the last decade through the use of hundreds of thousands of waivers of the Buy American Act and other government purchasing laws.  

But Andrew Hunter, a former Pentagon acquisition official and Congressional staffer, now with the Center of Strategic and International Studies, saw no glaring problem with DoD waivers to domestic-source restrictions and that most purchases “are extremely-high U.S. content.”  

Read the full story at DefenseNews