Speaking to the US Congress in his State of the Union address this week, Biden said: “On my watch, American roads, American bridges, and American highways will be made with American products…American-made lumber, glass, drywall, fibre-optic cables.”
In his first week in office, in January 2021, Biden signed an executive order initiating a review of long-established ‘buy American’ policies and launching an initiative to strengthen the use of federal procurement to support US manufacturing.
The executive order resulted in the setting up of a Made in America office within the White House Office of Management & Budget. The new executive office was codified by the Bipartisan Infrastructure Law in November 2021.
In this week’s State of the Union address, Biden said that ‘Buy American’ has been the law of the land since 1933. “But for too long, past administrations have found ways to get around it. Not anymore,” he said.
Biden also spoke about the importance of infrastructure to the US economy and how the country’s infrastructure had fallen behind that of other countries:
“To maintain the strongest economy in the world, we also need the best infrastructure in the world. We used to be number one in the world in infrastructure, then we fell to number 13.
“Now we’re coming back because we came together to pass the Bipartisan Infrastructure Law, the largest investment in infrastructure since President Eisenhower’s Interstate Highway System.”
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While Biden’s rhetoric struck the right note among patriotic members of the House of Representatives, some doubt the practicality of a blanket ‘buy American’ policy. Doug Carlson, chief executive of the National Utility Contractors Association (NUCA) said: “Our projects require a very complex mix of materials, some of which are not domestically manufactured.
“Some components are not made in the United States and must be bought overseas to complete a job. Other materials sourced from foreign sources are significantly cheaper and hold down federal government infrastructure expenditures,” he added.
“On some projects, a delay on a single critical part can delay the entire project, driving up costs and significantly postponing its completion.”
The Buy American Act does not limit federal purchasing to 100% US-made products. Legacy implementation rules qualify products as ‘made in America’ for federal procurement if 55% of their value is manufactured there.
Last year Biden updated the rules governing implementation of the law with intent to direct more of the $600bn (£495bn) spent by the US government on goods and services each year toward creating domestic jobs and industry.
A primary step in the new rules increased the qualifying US content to 60% in 2022. This threshold will increase to 65% in 2024 and 75% in 2029. The progression is designed to close loopholes in how the law is implemented and give businesses time to develop domestic production and adjust their supply chains to support US producers.
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