Consumer Reports Made in America?

How to know which flag-waving products are true red, white, and blue

Puzzling labelsLaws allow for patriotic symbols, as long as makers identify where a product was made.

Given a choice between a product made in the U.S. and an identical one made abroad, 78 percent of Americans would rather buy the American product, according to a new nationally representative survey by the Consumer Reports National Research Center.

More than 80 percent of those people cited retaining manufacturing jobs and keeping American manufacturing strong in the global economy as very important reasons for buying American. About 60 percent cited concern about the use of child workers or other cheap labor overseas, or stated that American-made goods were of higher quality.

And people would pay extra to buy American. More than 60 percent of all respondents indicated they’d buy American-made clothes and appliances even if those cost 10 percent more than imported versions; more than 25 percent said they’d pay at least an extra 20 percent. (Perhaps more surprising: According to a new survey of consumers in the U.S. and abroad by the Boston Consulting Group, more than 60 percent of Chinese respondents said they’d buy the American-made version over the Chinese even if it were to cost more.)

Clearly, most Americans want to know where products are made and want to buy those that will help create or keep jobs in the U.S.—an attempt applauded by economists like Jeff Faux, a distinguished fellow of the nonprofit, nonpartisan Economic Policy Institute, in Washington, D.C. “Consumers need to understand that all jobs and wages are interconnected,” Faux told us. “When you buy foreign goods—and sometimes there’s no choice—it means that fewer U.S. workers will have the money to buy the goods and services you sell.”

But what does “made in the USA” even mean? And how can you identify what’s made where?

In this special report, we’ll decipher labeling laws and explain why a product that pictures an American flag might be made abroad, identify companies that still make products in the U.S., hear from economists about manufacturing trends, and provide our experts’ assessment of the quality of some American-made apparel.

A guessing game

Photo by: Tooga

Few products except cars, textiles, furs, and woolens are required by law to reveal their American heritage. But when any manufacturer chooses to boast of an American connection, it must comply with federal rules designed to keep consumers from being misled.

Our evidence shows that if not misled, consumers are at least confused. Readers flood Consumer Reports with letters and e-mail seeking explanations as to why, for example, frozen blueberries from Oregon are identified as a product of Chile; why a company named Florida’s Natural sells apple juice with concentrate from Brazil; why pants made in Vietnam are labeled “authentic, active, outdoor, American”; or why a T-shirt with the words “Made in the” above the U.S. flag comes from Mexico.

Though perplexing, such words and pictures don’t usually violate regulations that are issued by the Federal Trade Commission, the agency responsible for protecting consumers from false or deceptive product claims. The key factors in determining whether a “Made in the USA” claim is deceptive, says FTC senior attorney Laura Koss, are the claim’s context and whether it’s likely to mislead a reasonable consumer. Ultimately, the line between legal and illegal is determined by the overall impression planted in consumers’ minds.

But the line is blurry. Every case is different and subject to interpretation, Koss says. Most of the complaints the FTC receives are initiated by companies that are pointing a finger at competitors they claim are seeking an unfair advantage.

When a company definitely crosses the line, the FTC’s priority is stopping the behavior, not punishment. If a company refuses, it faces civil penalties—in theory. In practice, the FTC has brought only one civil penalty case since the late 1990s, slapping toolmaker Stanley with a $205,000 fine in 2006 to settle charges involving the pedigree of its Zero Degree ratchets. (Stanley claimed that the ratchets were made in America, but the FTC noted that much of their content was foreign.)

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More Trade Actions – Wind Turbine Towers, Washing Machines

More Trade Actions – Wind Turbine Towers, Washing Machines

Dave Johnson  |  July 31, 2012  |  Campaign for America’s Future

The game is to underprice your product until your competitors go out of business (like Solyndra & other solar companies). Then you own the market. This is about a lot more than just jobs. Our government is finally doing something about leveling the playing field!

This week, in separate actions, our Commerce Department imposed “anti-dumping” tariffs on wind turbine towers and washing machines. The wind turbine towers were coming in from China and Vietnam, the washing machines from Mexico and South Korea.

Why Sell Under Cost?

Dumping is when a product is sold for less than it costs to evenmake the product. The idea is that your competitors will go out of business and the manufacturing ecosystem of suppliers, knowledge and infrastructure moves to you, so you’ll come out ahead in the long run.

It takes enormous investment to open up a manufacturing operation because you need the proper facilities, the right local utilities, the tools and machines, the skilled workforce, the suppliers, the local infrastructure, the channels to markets, and all the rest of the ecosystem that supports manufacturing. When that is lost to another country it is very, very difficult to get it back. Especially in a country with a Congress that refuses to understand the need for a national industrial policy.

This is the game that countries like China have been playing with their national industrial policies designed to capture strategic industries like solar and wind energy. By selling lower than cost for several years you gain market share and shed competitors. The suppliers, knowledge base, and jobs move their way. Eventually they build or strengthen an entire ecosystem and it is just too costly for others to try to compete.

At first it is attractive to take advantage of the lower prices, later the jobs, factories, companies and entire industries are gone along with the jobs and economic power they bring. Or, in other words, look around at what has happened to us.

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The Factory Factor: Why Outsourcing and ‘Made in America’ Could Decide this Election

Scott Paul

Executive Director, Alliance for American Manufacturing

American manufacturing is like apple pie to American voters: we love it and want more of it regardless of our politics, race, gender, income, or hometown. If you live in a swing state like Ohio, you already know that, because both presidential candidates have flooded the airwaves with ads labeling the other guy as the “outsourcer-in-chief.”

Beneath the recent accusations and counter-accusations on outsourcing, there is a simple truth: citizens believe manufacturing is central to our nation’s economic health, that America is in economic decline, that outsourcing to China is largely responsible for this condition, and they want their elected leaders to do something bold about it.

Voters of all political stripes are far ahead of the debate inside Washington, D.C. More importantly, perhaps, is that nearly all Americans — not only working-class Ohioans — share this view.

So don’t be surprised if both campaigns escalate the rhetoric and attacks on shipping jobs overseas in the coming weeks, in part to mask their own shortcomings.

That’s because no one is a knight in shining Made in America armor when it comes to this issue. Mitt Romney (rightly) criticizes President Obama for not labeling China as a currency manipulator, but glosses over the fact that Republican leaders in Congress are blocking a bipartisan currency bill that would pass overwhelmingly. Romney has also been on the wrong side of Administration decisions to defend American tire workers against China’s cheating and successfully rescue Chrysler and General Motors.

The GOP hypocritically accuses Obama of sending stimulus dollars overseas, while Republican Senators tried to block Buy America requirements for stimulus spending.

The fact is, accusing your political opponent of shipping jobs overseas is now an established American campaign tradition. What is missing is an honest debate about what could actually be done to promote American manufacturing jobs. Voters are ready for such a dialogue.

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