Manufacture This

The blog of the Alliance for American Manufacturing

Amendment to defense spending bill would make the Pentagon follow a procurement law.

Have you heard the story of New Balance, something called the Berry Amendment, and the Trans-Pacific Partnership trade deal?

If you haven’t, you’re in luck, for it’s a doozy.

Precious few athletic shoes sold in the United States are made here. Most footwear companies – like Nike, for instance – make them in low-wage countries like Vietnam and China. New Balance, which is headquartered in Massachusetts, does this as well, but also maintains factories in both the Bay State and Maine. Wolverine Worldwide, which manufactures Saucony shoes, also makes some shoes in the United States.

But it’s super hard to make shoes in America when your competitors can severely undercut you on price. That’s why New Balance has been very public in years past about its opposition to the TPP. Once signed, the agreement will slowly phase out tariffs on shoes coming in from Vietnam, and make it even easier to undercut American manufacturers on price.

But then, New Balance clammed up about the TPP for a good long while. Why? Maine Public Radio explains:

New Balance held its tongue about the TPP for nearly a year, [New Balance spokesman Matt LeBretton] says, because federal officials told the company that if it did so, New Balance would get a shot at a military contract.

“The Obama administration said, ‘Look, we know you’re really intent on pursuing selling shoes to the military — 100 percent domestically made shoes to the military. If you work with us on TPP, we’ll do everything we can to make sure you have an opportunity to bid for this military opportunity,’” LeBretton says.

Ever since, he says, the Department of Defense has put up roadblock after roadblock.

Selling shoes to the military? One-hundred percent domestically made shoes? What is LeBretton talking about here?

He’s talking about the Berry Amendment. It’s a federal law from 1941 that stipulates the Pentagon to outfit members of the military in uniforms and other equipment that are "100 percent made in the U.S."

For years and years, a loophole in the National Defense Authorization Act allowed the Pentagon to ignore the Berry Amendment and issue cash vouchers instead of buying American-made shoes.

New Balance says its American-made shoes meet that requirement, but it still hasn’t landed a contract to supply athletic shoes to military recruits. The Department of Defense says that’s because the company’s shoes are too expensive and not durable.

New Balance says that’s a load of bull. The company has offered to sell the shoes to the Pentagon at cost. And they’re highly skeptical of the Pentagon’s durability tests.

So am I, as I’m wearing a pair of them right now, and lemme tell you: I’ve put them through the wringer.

If it’s gonna be like that, New Balance has said, then it’s not gonna remain neutral on the TPP:

“We make a lot fewer shoes in the US than we do overseas, but the point is we’re trying to make more here, not less,” LeBretton said. “When agreements like this go into place, what that says to us is that our president and our trade negotiators, they don’t want us to make more products here.”

But there’s good news, at least for American-made athletic footwear: An amendment that would force the Pentagon to follow the Berry Amendment law has been added to both the House and Senate versions of this year’s NDAA. That would be a welcome development for the few American shoemakers left out there, who could rely on a steady federal contract.

As for the TPP? New Balance says first, it wants a fair shot at that military contract. And it’ll consider the trade agreement “if the appropriate safeguards are in place,” reports Maine Public Radio.

Until then, you can find New Balance’s Made in America line here.