Biden Signs Executive Order to Harness ‘Buy American’ Rules
The order aims to close loopholes that allow companies to offshore production and jobs while still qualifying for domestic preferences.
WASHINGTON, D.C. — President Joe Biden has signed an executive order aimed at closing loopholes in existing “Buy American” provisions, which apply to about a third of the $600 billion in goods and services the federal government buys each year.
An executive order signed Monday pushes federal agencies to buy more American-made products and services, and comes with new reporting requirements, a new senior-level oversight position and a new General Services Administration (GSA) website.
“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,” according to a factsheet released in conjunction with the president’s executive action. “This executive order fulfills President Biden’s promise to make Buy American real and close loopholes that allow companies to offshore production and jobs while still qualifying for domestic preferences.”
The factsheet cites federal agencies spend $600 billion annually in contract spending. The new executive order builds on existing laws — namely the Buy American and Buy America statutes, passed in 1933 and 1982, respectively — and instructs agencies to close loopholes that have made those laws ineffective over time.
Revitalizing the manufacturing sector, which accounts for about 12% of the U.S. economy, is integral to Biden’s broader push to drive up wages, create more union jobs, support minority-owned businesses and strengthen U.S. supply chains, White House officials say.
Former President Donald Trump issued similar Buy American rules in 2017; however, some manufacturing groups complained the regulations were not adequately enforced and did not result in real changes, NPR reported at the time.
“The previous administration did not take it seriously enough. Federal agencies waived the Buy American requirement without much pushback at all,” Biden said before signing the order. “That is going to change on our watch.”
Under the order, it will be harder for non-American contractors to qualify for waivers to sell products to federal agencies. The order also establishes: a central oversight mechanism, including a review board to approve waivers from specific requirements; a GSA-built website showing existing contracts with foreign companies; and a new director of Made-in-America position in the Office of Management and Budget (OMB).
The order will also work to connect new businesses to contracting opportunities by requiring active use of supplier scouting by agencies, according to the factsheet. Agencies will be directed “to utilize the Manufacturing Extension Partnership — a national network in all 50 states and Puerto Rico, that supports small and medium-size manufacturers — to help agencies connect with new domestic suppliers who can make the products they need while employing America’s workers,” the factsheet reads.
Jay Timmons, president of the National Association of Manufacturers, lauded the order in a statement.
“Any successful manufacturing policy must ensure we can lead our economic recovery by strengthening supply chains and accelerating onshoring, through incentives for creating the next job or investing the next dollar right here in America,” Timmons states. “We look forward to working with the Biden administration to grown manufacturing in the United States, while also protecting access to critical global supply chains and the resources that our lifesaving and life-changing products require.”
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