Executive Briefings

Buy American, Hire American: How Renewed Protectionism Is Reshaping Supply Chains

Cowboy hats, fire trucks and baseball bats - these were some of the products put on display at the White House during the "Made in America Week" this summer. While this was mainly a symbolic, PR-motivated show to celebrate American manufacturing, recent policy initiatives by President Trump's administration are aiming to reshape the supply chains of federal agencies and companies across many sectors.

Buy American, Hire American: How Renewed Protectionism Is Reshaping Supply Chains

In his first months in office, Trump signed a slew of executive orders intended to give domestic businesses an economic boost. These orders mainly scrapped regulations regarding hiring practices, carbon emissions and banking compliance. However, the headline announcement was his "Buy American, Hire American" executive order, which aims to tighten standards for federal procurement departments and companies that hire foreign workers.

There are two main directives in the order, as its title suggests. It directs all federal agencies to buy materials produced in the United States for all products used in daily operations or any federally-funded projects, with a particular emphasis on iron, steel and manufactured goods. Regarding hiring, the order mandates a crackdown on H-1B visas specifically, which are popular temporary work visas, especially for tech companies.

Overall, the goal is to funnel more taxpayer dollars back into U.S. businesses and make it more burdensome for companies to hire non-U.S. citizens. The resulting effect would mean a slimmer selection of suppliers for government procurement offices and a smaller labor pool for U.S. companies.

Not the First

It is important to note that laws commanding businesses to buy and hire American are by no means new. They date all the way back to Herbert Hoover’s Buy American Act of 1933. Even President Obama’s post-recession stimulus bill included a Buy American provision. A cap for foreign workers has existed long before Trump. Trump’s new initiatives are simply attempts to close all loopholes in existing laws that support domestic goods and workers. However, his rhetoric of economic nationalism is far more unabashed than that of past presidents, and he has slowly been implementing additional policies that reflect this, including withdrawing from the Trans-Pacific Partnership (TPP) and imposing tariffs on Canadian lumber.

Read Full Article

In his first months in office, Trump signed a slew of executive orders intended to give domestic businesses an economic boost. These orders mainly scrapped regulations regarding hiring practices, carbon emissions and banking compliance. However, the headline announcement was his "Buy American, Hire American" executive order, which aims to tighten standards for federal procurement departments and companies that hire foreign workers.

There are two main directives in the order, as its title suggests. It directs all federal agencies to buy materials produced in the United States for all products used in daily operations or any federally-funded projects, with a particular emphasis on iron, steel and manufactured goods. Regarding hiring, the order mandates a crackdown on H-1B visas specifically, which are popular temporary work visas, especially for tech companies.

Overall, the goal is to funnel more taxpayer dollars back into U.S. businesses and make it more burdensome for companies to hire non-U.S. citizens. The resulting effect would mean a slimmer selection of suppliers for government procurement offices and a smaller labor pool for U.S. companies.

Not the First

It is important to note that laws commanding businesses to buy and hire American are by no means new. They date all the way back to Herbert Hoover’s Buy American Act of 1933. Even President Obama’s post-recession stimulus bill included a Buy American provision. A cap for foreign workers has existed long before Trump. Trump’s new initiatives are simply attempts to close all loopholes in existing laws that support domestic goods and workers. However, his rhetoric of economic nationalism is far more unabashed than that of past presidents, and he has slowly been implementing additional policies that reflect this, including withdrawing from the Trans-Pacific Partnership (TPP) and imposing tariffs on Canadian lumber.

Read Full Article

Buy American, Hire American: How Renewed Protectionism Is Reshaping Supply Chains