The new executive order seeks to increase government purchases of U.S. goods

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Trade experts say restoring critical supply chains and developing new ones is critical to U.S. manufacturing growth.

The new executive order seeks to increase government purchases of U.S. goods

President Joe Biden on Monday will announce measures designed to leverage the U.S. government’s buying power to increase domestic production and create markets for new technologies, a senior administration official said.

Biden will sign an executive order aimed at eliminating loopholes in existing provisions of the Buy American Act that structure $600 billion in federal purchases of goods and services. The plan is to make the exemptions more transparent and create a special White House coordinator position to oversee the process.

“The U.S. spends about $600 billion a year on contracts, and that money could serve as a stimulus to revitalize our industrial capacity and help create markets for new technologies,” the source said.

Boosting U.S. manufacturing, which was one of the main tenets of Biden’s campaign, has proved challenging for previous presidents, including Donald Trump.

Because of lower labor costs and weaker environmental standards, China and other countries have seen a massive exodus of key manufacturing capacity in recent decades, including in the medical field, leading to supply disruptions during the COVID-19 pandemic.

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China replaced the U.S. as the world’s top producer in 2010, and in 2018 it accounted for 28 percent of global production, according to the United Nations.

Trade experts say restoring critical supply chains and developing new ones is critical to U.S. manufacturing growth.

The executive order is designed to prevent companies from which the government makes purchases from importing predominantly foreign-made goods and selling them as U.S. goods after making only minor changes.

Regulators would have to process the changes within 180 days. There are also plans to create a website to ensure transparency of approvals issued.

According to the source, Biden “does not accept the defeatist idea that because of automation and globalization there can no longer be good-paying jobs in America.”