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The Problem with DHS's Plan to 'Buy American'

An anonymous reader points out a Cnet report on the Homeland Security Authorization Act, which would require that more than 50 percent of the components in any end product bought by the Department of Homeland Security be produced or manufactured in the U.S., writing "The Pentagon has agreements with 21 countries that waive the act, but an amendment that just passed the House would prevent the DHS from waiving the 'Buy American' restrictions. "The president of the Information Technology Association of America observed that this means the DHS may 'have to learn to do without computers and cell phones,' since he could not think of any manufacturers of those devices that would meet the 50% threshold."

22 of 626 comments (clear)

  1. Buy American? by Anonymous Coward · · Score: 5, Funny

    The Saudi Arabs already did. They bought their American -- George W.

    Sad but true.

  2. Hahahaha by Duncan3 · · Score: 5, Funny

    Haven't you heard, Americans are above making things. Our hands might get dirty like.

    Congress is just out of it, like always.

    --
    - Adam L. Beberg - The Cosm Project - http://www.mithral.com/
    1. Re:Hahahaha by Saven+Marek · · Score: 5, Interesting

      Well this is one of those things that shows how the government is out of touch with reality and of what goes on outside of theory. all good and maybe 'faith based' government is like this. believe it and it will come true?

      I remember a US school district dumped apple laptops for schools because they werent made in the US.

      Wonder which US-made laptops they picked up instead. mattel?

    2. Re:Hahahaha by xiphoris · · Score: 5, Interesting

      World banks are actually very concerned that this might happen. However, our saving grace currently is that other countries have invested too much money in our economy. They can't withdraw their money; if they did then what you described would be very likely to occur.

      As pointed out in popular movies such as Fahrenheit 9/11, Saudi money comprises a couple percent of the US economy. That's a lot. About as much as Wal-Mart.

      If that money went away we'd be feeling it very hard. But, I think there's a 90% chance that doesn't happen.

      Think of it as a game of chicken. The US and other countries are in a game of chicken. We all know that our currency is quickly losing real value, but people are too afraid and too dependent on the US economy to "pull out". Japan might be a big electronics buyer itself, but many more of its products are shipped overseas, primarily to the USA. If our market of consumers disappeared, so would their production economy.

      The game of chicken continues until one of two things occurs. (1) Other countries pull out of the US. A cascade effect occurs and the world is in a depression. (2) Other countries don't pull out and slow, steady inflation causes US foreign debts to be effectively erased.

      Lots of powerful companies are banking on #2 to happen. If #1 happens, everyone loses, but if #2 happens, it's really the poor people, the factory workers and sweatshop slaves, in 3rd world countries that lose out.

  3. DHS by FidelCatsro · · Score: 5, Insightful

    a rather stupid rulling here , If your going to run a department which deals with national security it is in your intrests to use the best avaliable .Arguments on the usefullness of the DHS aside , if they want to perform to peak effiency they must use the best the world has to offer not the best the USA has to offer.

    --
    The only things certain in war are Propaganda and Death. You can never be sure which is which though
    1. Re:DHS by SaberSix · · Score: 5, Informative

      As a Government acquisition professional, I would like to point out that buy American does not apply to commercially available products. It is recognized that market forces will generally provide fair pricing.

      This ruling applies to custom development (hardware/software) only. So DHS can buy all the cell phones they want from Taiwan. If they want buy something that does not exist in the commercial market, then "Buy American" applies.

    2. Re:DHS by RandomJoe · · Score: 5, Interesting

      I wish you would explain that to the Corps of Engineers! At least, the a$$holes I have to deal with... We use "commercially available" products to install our HVAC systems (they could go down and buy them from most any parts house themselves), but we certainly DO have to comply with Buy American when doing the job. Or so they say, and since they control the purse strings...

      This leaves us in a bit of a bind. Most foreign-made items we use DO have an American made option, but it is - horrors! - an INFERIOR option. One we would never use otherwise. Luckily, the more critical components are made by companies that the DOD has on their exceptions list, but it still means we have to deal with the paperwork verifying that.

  4. sad by Anonymous Coward · · Score: 5, Insightful

    i find it sad that our own government agencies are being forced to buy american because they wouldn't otherwise. what does that say about the american economy?

  5. Not to worry... by sampowers · · Score: 5, Funny

    No need to worry about this. DHS will just have the regs changed to mean that 50% of components by weight must come from within the US. Then they can just add lead weights to every computer case and cell phone housing manufactured in the US, to allow all those patriotic manufacturers to make some scratch off the war on terror.

    9/11! NEVER FORGET!

    1. Re:Not to worry... by miffo.swe · · Score: 5, Funny

      This is kinda funny and tragic at the same time. In Russia they often added weight to goods. That was because production was mesured in weight and not in quality or finish. A heavy bed was considered "better" since it showed the plant made much stuff.

      The US is getting awfully close to old Russia theese days.

      --
      HTTP/1.1 400
  6. Re:bad idea. by peculiarmethod · · Score: 5, Insightful

    I believe it. It seems we are (sigh) again repeating history. After large battles we temporarily go into short periods of extreme isolationism of one sort or another. This seems to be one of those knee-jerk reactions. Think about when the buy American stuff started (which war was it again? umm, WWII perhaps?). And which cars do we hate the most? (other than Ford, I mean) Oh thats right.. the cars built by our greater adversaries. Ignoring good technology to punish others or to feel self righteous is only self defeating and limits your possible options. This, too, shall pass.

    --
    ** "It's not my job to stand between the people talking to me, and the ones listening to me." -- Pego the Jerk
  7. Re:The problem really is by larien · · Score: 5, Informative

    No, they'd never do something as low and underhand as that... That would be like putting an illegal tariff on steel imports...

  8. Re:The problem really is by alexo · · Score: 5, Informative

    > That would be like putting an illegal tariff on steel imports...

    Or, say, softwood lumber?

  9. Re:I don't care, buy it cheap! by Catbeller · · Score: 5, Insightful

    Ah, the horror of cost accoounting.

    That $8.00 per item savings translated, in the past two decades, into complete shutdown of the textile and clothing manufacturing industry in the U.S. That meant millions of people thrown into the local Wal-Mart job, if they were lucky, and onto welfare if not. And Wal-Mart exists because it passes its healthcare on to the local state's tax-supported public services -- not to mention the number of Wal-Martish employees who are on food stamps because they aren't paid enough to eat.

    That eight bucks cost us our electronics sector, our manufacturing sector, software, it goes on and on.

    The "savings" is localized on someone's balance sheet. The cost incurred to generate that savings is measured in ruined careers, disappeared industry, impoverished people, and let's not forget, the almighty national security hole caused by our inability to make our own defense equipment.

    The savings in moving our economy overseas goes into few pockets, but the costs come out of all our taxes. And the real costs never show up in the Economist or the cable news shows, because those are paid by the poor and almost-poor, the invisible majority that don't really count.

    Those tax savings are lost on the back end.

  10. Re:duh.. by TripMaster_Monky · · Score: 5, Interesting

    Yes, but it's usually high end and thus out of reach of the masses.

    examples:

    Bose Wave Radio
    McIntosh audio equipment
    Apple's XServes
    IBM servers and mainframes
    Cisco Routers
    Netopia Routers
    AMI Motherboards
    Lots of commercial electronics for things like autos, CNC machines, telephony ... etc

    The same goes for electrical components that you don't see like Illinois Capacitors, TadCom resistors, several OEM power supplies ... etc.

    The real reason that so much industry has moved overseas to places like China and India, is that there are very loose environmental and worker safety rules. Manufacturing electronics involves toxic chemicals that are very expensive to dispose of in Germany, US and Japan ... but in China you can just dump these chemicals out the back.

    --
    __________
    |rip/\/\aster /\/\onky
  11. As a taxpayer by Bender0x7D1 · · Score: 5, Insightful
    While I think that the 50% threshold is unreachable, I don't think that the overall aim of this measure is so bad.

    Since the government buys their equipment using money from the US taxpayers, it seems in the best interests of the taxpayers and the country to keep as much of that money in the country as possible. Consider the following:

    The US government outsources everything to companies in other countries - everything from highway construction to phone support to the IRS. Making up a number for the tax rate, call it 40%, that people pay, including the federal taxes in gas, phone service, licensing, income taxes, etc. This means that every year 40% of the countries GDP goes to another country or countries. That reduces the overall "value" of our country by that much. At the other end, if we pay nothing to other countries for services or aid or anything, the "value" of the country remains the same.

    Now, I understand that this isn't realistic economically, but it illustrates the point. As a government, isn't it better for their citizens if as much of their expenditures as possible remain in the country? Yes, it is possible that buying from an outside source is cheaper, (for the nation as a whole), than buying locally. (For example, many food crops won't grow in the US and to irrigate/climate control the fields to support those crops would cost more than buying them outright from somewhere else.) However, for a few percentage points difference in the price, I doubt it, since we have to consider income taxes that the country "gets back" by taxing the workers who produce it. (Assuming all other aspects are equal.)

    With that said, I think it would be better overall to embrace a true global economy, so if someone in India can do a job better/faster/cheaper then they can do it. However, since we don't have a world government, and we still have this annoying habit of killing each other over things like imaginary lines on a map, I don't see any real alternative to being somewhat protective of the country you happen to reside in, whether that is the US, the UK, China or India.
    --
    Reading code is like reading the dictionary - you have to read half of it before you can go back and understand it.
  12. Cell phone that's 50% American by davidwr · · Score: 5, Interesting

    American Cell Phone Company buys cell phone part pre-assembled from China for $20 and battery from Korea for $10, then does final assembly here and charges $61 wholesale to the gov't.

    By value, it's over half American-made.

    If 51% mass is the problem, bundle it with an American-made car battery and charging device.

    You may think this is funny but crazy rules call for crazy workarounds.

    --
    Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
  13. Re:I don't care, buy it cheap! by Monkelectric · · Score: 5, Interesting
    And Wal-Mart exists because it passes its healthcare on to the local state's tax-supported public services

    I worked at walmart for a while after college -- The people there were just miserable, and I dont mean shitty people, actualy most of the people were pretty nice, it was just like being on the ship of the damned. The smarter among us knew where the ship was headed, the less aware didn't. And the undertext was always, dont tell anyone. Management was stupid, but they could spot the smart people -- who didn't generally last long. I got along by pretending to be not stupid, but not smart either. They want someone just smart enough to stock their shoes, electronics, etc, and not be trouble -- but stupid enough to believe their lies. They lied constantly, did rotten (and sometimes illegal) things, and just generally made your life shit. The guys who had been there for 15 years, were worn to the nub by life. I was originally thinking of trying to become the store manager or something -- I was *BY FAR* the most educated employee with a BS, but after a while my conscience started to bother me. I *literally* felt by working at this company I was selling out myself, the country, and my own interests.

    I quit after a few months when they decided to make me permanant... my back was hurting so bad from the labor that I couldn't sleep more then 3 hours at once (i'd wake up with knotted muscles, have to stretch for 20 - 30 mins, then go back to sleep) And it wasn't like I could afford the walmart insurance, which IIRC was about 30% of your wage (7$ an hour).

    The other thing that struck me (coming from a household that made over 200k a year) was how poor the people working there were. I remember one girl bragging abuot how well she was doing -- she had a dvd player and a ps2.

    --

    Religion is a gateway psychosis. -- Dave Foley

  14. Re:duh.. by dabigpaybackski · · Score: 5, Insightful
    The real reason that so much industry has moved overseas to places like China and India, is that there are very loose environmental and worker safety rules. Manufacturing electronics involves toxic chemicals that are very expensive to dispose of in Germany, US and Japan ... but in China you can just dump these chemicals out the back.

    Yes, that's right, and those people are poisoning themselves, particularly in China. The pollution in the industrial cities is so bad that if it goes unchecked, it will, paradoxically, threaten their economic survival. Ruined land and water is no good to anybody.

    Tangentially: have you ever driven on I-80 through the Rust Belt? I'm talking about former manufacturing hubs like Buffalo, Gary, and parts of Cleveland. They look abandoned. And the factories? Rusting and abandoned. It's sad, not only because of the unemployment and social upheaval, but because great swaths of that abandoned land cannot be reclaimed for agriculture. The soil and groundwater is too polluted. So the hulks of the factories remain, the rusting monuments to America's fading greatness.

    Now, what's really eerie are all of the abandoned strip malls: just boarded-up buildings and weedy expanses of grey asphalt. Nearby, you find housing built in the 40's and 50's, some abandoned by the people who once made their livings in the factories, some filled with poor immigrants, others by retirees who try to keep up appearances and put out their flags on Independence Day. I'm not being lurid here, either. There are a thousand towns like this and they are depressing places. What will become of them?

    --
    "OH SHIT, THERE'S A HORSE IN THE HOSPITAL!"
  15. Re:duh.. by Guppy06 · · Score: 5, Funny

    "Yes, that's right, and those people are poisoning themselves, particularly in China. The pollution in the industrial cities is so bad that if it goes unchecked, it will, paradoxically, threaten their economic survival."

    What China needs is an armed revolution by the working classes, overthrowing their government and setting up a true worker's paradi... oh, er, nevermind.

  16. Re:bad idea. by jaydonnell · · Score: 5, Insightful

    I think you and everyone else have missed a major point. What happens if the devices our military depends on are not developed and made in america? Two things:
    1. Our military won't be able to keep up with the technical advances of other countries because we no longer produce enough engineers and scientists. All the engineers will be overseas
    2. Our national defense will depend on foriegn companies selling us equipment which they may choose not to do at some point in time.

  17. Re:I don't care, buy it cheap! by bnenning · · Score: 5, Insightful

    The other thing that struck me (coming from a household that made over 200k a year) was how poor the people working there were. I remember one girl bragging abuot how well she was doing -- she had a dvd player and a ps2.

    Which makes her richer than 95% of the world's population. Poverty is relative; as long as there are any differences in wealth, there will be people near the bottom. But the bottom in the US and other developed nations is far higher than the rest of the world, and far higher than it was anywhere 100 years ago. You can thank capitalism for that.

    --
    How to solve most of our problems: 1.Lots of nuclear plants. 2.Cure aging.