Category: From Alliance for American Manufacturing

New Bipartisan Legislation Aims to Make it Tougher for China to Dodge Trade Laws

Elizabeth Brotherton-Bunch

Elizabeth Brotherton-Bunch Digital Media Director, Alliance for American Manufacturing

Sens. Tammy Baldwin (D-Wis.), Shelley Moore Capito (R-W. Va.), Debbie Stabenow (D-Mich.) and Bill Cassidy (R-La.) introduced a new bill on Tuesday to “crack down on unfair trade cheating from nonmarket economies like China.”

O.K., we know: We need to be more specific here.

The Senators want to give the Commerce Department more power to hold China and other countries accountable when they evade anti-dumping (AD) and countervailing duties (CVD).

For those unfamiliar with this area of U.S. trade law, the United States issues AD/CVD duties when imported products are found to be sold below market value or to have received significant government subsidies when being produced. The idea is to level the playing field a bit for American workers and companies, who operate in a free and open market.

As the Senators note, AD/CVD rules are pretty common, and most countries follow them without issue. But nonmarket economies — especially China — work overtime to dodge these duties, engaging in “a sophisticated and government-backed effort to avoid the duties required.”

For example, China “alters their products slightly to get around the rules, violating the spirit of the law, if not the letter.” It isn’t individual Chinese companies doing this, remember: China uses “its vast government resources” to ensure these firms are able to evade U.S. trade laws and avoid the duties.

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We’re Revisiting Some of Our Favorite Past Made in America Holiday Gift Guide Picks

We're putting the finishing touches on the 2019 Made in America Holiday Gift Guide, our annual assortment of American-made gift ideas from every state, the District of Columbia, and Puerto Rico. We work hard every year to pick new items, and the vast majority come from companies that never have been on the list before. We also try to include an eclectic mix of ideas at a range of price points — there's something for everyone on your list!

The 2019 guide is scheduled to be released on Monday, Nov. 25. But in the meantime, we've been reminising about our favorite items from past gift guides, and thought we'd share some of them below. You can also check out the full guides from previous years below.

2018 | 2017 | 2016 | 2015 | 2014 | 2013

Staff Picks

AMERICAN ROOTS 

With the cold blast of air blanketing most of the U.S. this week, all I can think about is something warm to wear to brave the sub-freezing temperatures. My choice to stay warm is fleece. American Roots is a Made in Maine company that offers a full line of custom-made fleece products, including jackets, vests, pullovers, hoodies, blankets, and even hats. I particularly like the fleece vests, which are unencumbering when worn with layers of garments underneath and do not feel or appear bulky when paired with a heavy winter coat. Like the hoodies, the vests are an added layer of protection that can comfortably be worn around the house if you feel a draft of cold air coming through the windows. Owners Ben Waxman and Whitney Reynolds launched American Roots in 2015 — the company made the 2016 gift guide — with the specific goal of manufacturing clothing in America again. Also worth noting? The employees are represented by the United Steelworkers union. Now, all I need is a fireplace and some hot chocolate. —Jeff Bonior

DEARBORN DENIM

A good pair of denim jeans is hard to find, and I used to go through too many of them. I commute by bike, and five days a week on a bike seat will wear through your imported Levi’s pretty fast! That’s why I switched over to buying Dearborn Denim, which made the 2016 guide. They’re tough and won’t rip on you. The company’s website has a nifty feature that will tell you which size jeans you should buy (just enter your height and weight). And lastly, as a Chicagoland expat, I’m very proud to be able to buy jeans that are made in the Windy City. We will win the Super Bowl someday—Matthew McMullan

GREEN TOYS

AAM first put Green Toys on our gift guide list way back in 2013, and the California company continues to be a kid-friendly favorite.  I have two young children of my own, so I can personally vouch that these eco-friendly, BPA-free toys are always a hit with babies and young kids. The stacking cups and First Keys are great options for infants and the line of bath toys provide plenty of bathtub fun. My kids also have enjoyed the Dump TruckShape SorterHouse PlaysetSandwich Shop, and Build-a-Bouquet — and for the past two springs, we've planted a little garden with the Abby's Garden Planting Activity Set, a collaboration with Sesame Street. Another great thing about the company? Green Toys are made from recycled milk jugs, and everything is packaged in recycled cardboard, cutting down on the plastic waste typically associated with toys. —Elizabeth Brotherton-Bunch

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Don’t Let China’s State-Owned CRRC Build NYC’s Subway, State Lawmakers Say

Elizabeth Brotherton-Bunch

Elizabeth Brotherton-Bunch Digital Media Director, Alliance for American Manufacturing

As Congress continues to work on legislation to ban China’s government-owned, controlled or subsidized companies from receiving U.S. tax money to build rail cars and buses, local lawmakers are taking on the issue in their own states.

The latest instance is in New York, where state Assemblymember Michael Cusick (D) is teaming up with state Sen. Diane Savino (D) on a bill to prevent foreign state-owned enterprises, including the China Railway Rolling Stock Corporation (CRRC), from using New York tax money on mass transportation projects.

Like federal lawmakers who have championed this issue, Cusick and Savino say they are worried about the security threats posed by allowing a firm with direct ties to the Chinese state apparatus to build critical infrastructure systems.

They point to recent testimony from former Department of Homeland Security Secretaries Michael Chertoff, Janet Napolitano and Jeh Johnson, who all specifically mentioned critical infrastructure when discussing cyber security threats at a Senate Homeland Security and Governmental Affairs committee field hearing in New York.

“There is wide consensus that allowing CRRC and other state-owned enterprises to have open access to our critical rail infrastructure and mass transportation systems is ill-advised,” Cusick said in a statement. “These contracts create major cybersecurity vulnerabilities in the U.S. The goal should be risk avoidance, not mitigation.”

There’s little doubt about China’s intentions with CRRC.

New research from Radarlock examined the company’s deep ties to China’s government, communist party and military, concluding that CRRC is a key part of China’s plan to dominate global industry. But it’s more than that – CRRC also obtains technology for potentially nefarious purposes, handing everything it gathers from its work abroad to the Chinese state and military.

Cusick and Savino say they are also worried about CRRC’s economic impact, noting that CRRC has nabbed contracts in major cities like Chicago and Los Angeles by “drastically underbidding other railcar manufacturers and using non-market tactics.”

The issue is of critical importance in the Empire State because New York City is looking to upgrade its iconic subway system. CRRC won a 2018 Metropolitan Transit Authority (MTA) contest to design new subway cars – a development that quickly drew the ire of Democratic Senate Leader Sen. Chuck Schumer, who hails from New York.

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Report Highlights U.S.-China Priorities for Congressional Action

Cathalijne Adams Digital Media Manager, AAM

It’s been a big year in U.S.-China relations, and the conclusion of 2019 may or may not see the end of a trade war between the nations. The U.S.-China Economic and Security Review Commission, charged with monitoring and investigating the national security implications of this bilateral economic relationship, has had plenty to keep an eye on.

Among a number of recommendations for congressional action in the Commission’s just-released annual report, several stand out in particular.

The Commission calls for Congress to address U.S. dependence on Chinese pharmaceuticals – an issue to which we’ve been paying close attention to for some time. Just this past month, Michael Wessel, who sits on the U.S.-China Commission, laid out in testimony before a House committee China’s plans to dominate America’s drug supply as a means of securing economic supremacy but also to potentially “weaponize its supply chain should it so choose.”   

The Commission’s 2019 report recommends that Congress continue to hold hearings exploring U.S. dependence on China’s pharmaceuticals. However, the commission is clear on the goal of these hearings: Legislation that requires the Food and Drug Administration to identify pharmaceuticals that are manufactured exclusively in China or formulated with the active pharmaceutical ingredients made in China, as well as an investigation to determine whether those drugs are manufactured with as much regulation as pharmaceuticals produced in America.

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There’s a Lot of “Banned, Unsafe, Mislabeled” Stuff on Amazon That’s Imported From China

Matthew McMullan

Matthew McMullan Communications Manager, Alliance for American Manufacturing

The Wall Street Journal has published a lengthy look at Amazon’s years-long effort to bring products directly from Chinese factories to me and you, the American consumer. How has this effort turned out?

Well, the title of the article is “Amazon’s Heavy Recruitment of Chinese Sellers Puts Consumers at Risk.” So … maybe good for The House That Jeff Built, but kinda bad for consumers!

This is another example of the Journal giving Amazon the business recently. Only a few weeks ago it reported that the company stubbornly lists for sale lots of clothing produced in Bangladeshi factories that even competitors like Walmart shun because of chronic violations of basic safety standards. And in August, the Journal detailed how little oversight the company has over the products sold on its platform, which results in “thousands of banned, unsafe or mislabeled products” floating around on there. The paper itself found more than 10,000 such items on the site between June and August.

And now comes today’s story. The paper reports that out of nearly 2,000 sellers of problematic items (whose addresses could be determined), more than half were based in China.

That’s the result of Amazon’s effort to “cut out the middleman” between Chinese manufacturers and America’s online shoppers.

That was the sales pitch an Amazon representative made this year at a trade event in Hong Kong … but it’s not an accurate description of what the company has been selling to the Chinese manufacturers it’s recruiting. The Journal cites another Amazonian who was much more on the nose in 2017 when she told a conference audience of Chinese business people: “We help factories directly open accounts on Amazon and sell to U.S. consumers directly. This is our value.”

These pitches appear to have been effective. Amazon doesn’t require its sellers to list where they’re located (or share that information), but the Journal cites an outside analysis of the 10,000 most-reviewed Amazon sellers that found approximately 38% of them are now located in China … a percentage that has increased steadily since Amazon began recruiting Chinese sellers in 2013.

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How holiday favorite Wendell August Forge rose from the ashes, stronger than ever

Jeffrey Bonior Researcher/Writer, AAM

The artisans and craftsmen at Wendell August Forge have been making holiday-ready hand-hammered metal gifts and ornaments in Mercer, Pa., for nearly 100 years.

But in 2010, it all went up in flames.

***

Located about 40 miles north of downtown Pittsburgh — the capital of the American steel industry — America’s largest and oldest forge sits tucked away in an industrial part of Pennsylvania.

Forging is one of the oldest working techniques of artisans. It involves heating, hammering and shaping metal objects. Every Wendell August Forge piece follows this old school tradition, hand-shaped one at a time by the company’s craftsmen (who also are members of the United Steelworkers).

Wendell August Forge makes a variety of items, including holiday gifts — the company is well-known for its one-of-a-kind Christmas tree ornaments — and just launched a new line of NFL-themed coasters and keychains. The company also creates home décor items including bowls, dishes, cutting boards, glassware, and other tabletop pieces. Wendell August Forge has a gift for nearly every special occasion, including wedding gifts, commemorative gifts, baby gifts, Mother’s and Father’s days gifts and patriotic holidays. 

Will Knecht owns Wendell August Forge with his sister. His mother and father bought the company in 1978, and Knecht continues to take pride in the time-tested traditions of its past.

“We really believe in this thing called American craftsmanship. We get calls two or three times a quarter with people saying there is this factory in China that you guys should really consider, and it is no way,” Knecht said. “We were Made in America before it was cool to be Made in America, and we will continue to be Made in America.”

But the future of the tough-as-metal company looked grim in 2010, when a fire caused the factory, corporate offices and flagship retail store to burn to the ground. This was just after the company had gotten its largest order ever from the Pittsburgh Penguins National Hockey League team.

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Global Steel Industry Groups Unite for Action on Steel Excess Capacity Crisis

Monique Mansfield

Monique Mansfield Press Secretary, AAM

Steel industry associations in the Americas, Europe, Africa and Asia are urging their governments to intensify efforts to confront and solve the issue of excess capacity in the global steel sector.

Apparently, current methods just don’t seem to be working effectively!

The 19 associations involved released a statement, urging their various governments into action including implementing “strong rules and remedies that reduce excess capacity, its impact and causes.”

Just get some strong rules going! Sounds like a simple fix, right?

The solution becomes more complicated as the unexpected growth of new steelmaking facilities have contributed to trade tensions and have aroused some concern. Wherever could those be? The steel industries concurrently agree that the systems in place aren’t working and that “efforts by the governments to eliminate practices that lead to excess capacity should be doubled.” And they also praised a September statement from the Organization for Economic Cooperation and Development that expressed concern over the recent capacity expansions.

In the statement the associations said they’re “hopeful that the diligent efforts of Japan, the current G20 Chair, are successful in extending the G20 Global Forum on Steel Excess Capacity beyond 2019.” That means these industries want these global organizations to keep talking about fixes to the overcapacity problem.

But let’s be clear about where the overcapacity problem starts and stops: In China.  

***

Global Steel Industry Groups Unite for Action on Steel Excess Capacity Crisis

Monique Mansfield Press Secretary, AAM

Steel industry associations in the Americas, Europe, Africa and Asia are urging their governments to intensify efforts to confront and solve the issue of excess capacity in the global steel sector.

Apparently, current methods just don’t seem to be working effectively!

The 19 associations involved released a statement, urging their various governments into action including implementing “strong rules and remedies that reduce excess capacity, its impact and causes.”

Just get some strong rules going! Sounds like a simple fix, right?

The solution becomes more complicated as the unexpected growth of new steelmaking facilities have contributed to trade tensions and have aroused some concern. Wherever could those be? The steel industries concurrently agree that the systems in place aren’t working and that “efforts by the governments to eliminate practices that lead to excess capacity should be doubled.” And they also praised a September statement from the Organization for Economic Cooperation and Development that expressed concern over the recent capacity expansions.

In the statement the associations said they’re “hopeful that the diligent efforts of Japan, the current G20 Chair, are successful in extending the G20 Global Forum on Steel Excess Capacity beyond 2019.” That means these industries want these global organizations to keep talking about fixes to the overcapacity problem.

But let’s be clear about where the overcapacity problem starts and stops: In China.  

China, Which Has a Steel Overcapacity Problem, Leaves Forum on Steel Overcapacity

Matthew McMullan

Matthew McMullan Communications Manager, Alliance for American Manufacturing

Last week we noted how an international group of steel industry associations had released a statement, calling on their governments to figure out a way to reduce steel production overcapacity – the difference between an industry’s potential output and current production.

They released it ahead of a meeting of the G20 Global Forum on Steel Excess Capacity, which convened in Japan over the weekend. That forum was created in 2016 to find some international consensus on how to fix the overcapacity problem, which is (not entirely but) mostly a problem created by China’s massive steel industry.

The Chinese government might dismiss that as an outsider’s biased opinion, but consider the context in which China’s steel industry grew. In the early 90s it became a “strategic” industry in government planning documents. According to an analysis of the industry produced a few years ago at AAM’s behest by Duke University, “state direction, supplemented by state subsidies, incentives, and strong internal demand for steel, had an important role in developing China’s steelmaking capacity.”

And so it went from responsible for a fraction of global production in 2000, when it produced 129 million metric tons (MMT), to approximately half of production in 2015, when it produced 804 MMT. While most of that Chinese steel was consumed in China – the country spends a lot on infrastructure as a form of economic stimulus, and infrastructure requires steel – its considerable excess spilled out into the international market, depressing prices and triggering bankruptcies and layoffs. This was essentially the preamble to the import tariffs the Trump administration finally raised on steel in 2018.

So back to this weekend’s G20 steel forum: Was any news created during this meeting? Anything of note?

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Why China’s CRRC and BYD Pose Such a Serious Threat to the United States

Brian Lombardozzi VP for State Government Affairs, AAM

People seem especially skeptical of China these days.

South Park put together a whole episode about China (and saw its existence in China vanish). The NBA spent the week stumbling over itself to appease the Chinese government, and then on Oct. 9, at least three fans in Philadelphia and in Washington, D.C. were removed from NBA exhibition games at U.S. arenas for holding up signs in support of pro-democracy protests in Hong Kong. 

That same day, New York Times opinion columnist Farhad Manjoo penned this:

“The People’s Republic of China is the largest, most powerful and arguably most brutal totalitarian state in the world. … Yet unlike the way we once talked about pariah nations — say East Germany or North Korea or apartheid South Africa — American and European lawmakers, Western media and the world’s largest corporations rarely treat China as what it plainly is: a growing and existential threat to human freedom across the world.”

A lot of people are finally waking up to the shuddering effects China’s model of state-led capitalism is having around the world. But many in the United States are still willing to overlook these concerns (and others, like say China’s abysmal record on human rights) so long as they can turn a profit by accessing the Chinese market.

That part of the story has gotten a lot of attention (watch that South Park episode for more). What garners less notice is that many Americans are also willing to welcome China’s heavily subsidized state-owned enterprises (SOEs) to set up shop in their communities. This is a mistake.

American Jobs At Risk

We already have seen the destructive impacts of China’s model of state-led capitalism on our domestic manufacturing sector, and the damaging ripple effects on thousands of communities across our nation. Between 2001 and 2017, 3.4 million U.S. jobs were lost or displaced because of our massive bilateral trade deficit with China.   

Most of those jobs went away because American companies offshored production to China following its entry into the World Trade Organization, which was supposed to move China toward a market-based economy (spoiler: the opposite happened).

But now China’s government-owned, controlled and subsidized companies are setting up assembly operations right here in the United States.

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Union Matters

Members of Local 7798 achieve major goal with workplace violence policy

From the USW

Workers at Copper Country Mental Health Services in Houghton, Mich., obtained wage increases and pension improvements in their contract ratified earlier this year, but the benefit Local 7798 members were most proud of bargaining was language regarding workplace violence.

The contract committed the employer to appoint a committee, including two members of the local, to draft a workplace violence policy. Work quickly began on the policy, and just last week, the committee drafted and released its first clinical guideline focusing on responding to consumer aggression toward staff.

“We are so excited to have this go into effect,” said Unit Chair Rachelle Rodriguez of Local 7798. “This was a direct result of our last negotiating session.”

The guideline includes the definition of aggression and an outline of procedures, all of which will be reviewed yearly. And though this is just a first step in reducing the incident rates and harm of workplace violence in their workplace, it still is a big one for the local, and it wouldn’t have been possible without a collective bargaining agreement.

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There is Dignity in All Work

There is Dignity in All Work