'Buy American': Murphy amendment would tighten loophole in defense spending bill

By:  Scott Whipple
New Britain Herald

New Britain — Reviving Connecticut’s manufacturing economy has been a longtime goal of U.S. Sen. Chris Murphy. D-Conn. According to Murphy, Connecticut added 2,000 new manufacturing jobs in 2014. This is the first sizable increase in more than a decade.

So it was not surprising last week that Murphy was “thrilled” when he heard the House and the Senate had supported his “Buy American” amendment.

“I’ve heard from too many Connecticut manufacturers over the years that they’re hurting because the Pentagon exploits a loophole in the law — spending American taxpayer dollars at foreign corporations that compete with local manufacturers,” Murphy said.

When the U.S. Senate passed the House-Senate 2016 National Defense Authorization Act, Murphy’s “Buy American” amendment was included in the NDAA. His provision will increase Congressional oversight of U.S. Department of Defense by requiring more transparency over the Department’s “overuse” of Buy American Act waivers through the “overseas use” loophole in the law. This loophole has had a negative impact on businesses, including local ones, that are competing in the global market.

Polamer Precision of New Britain is a contract aerospace manufacturing firm that produces high-quality engine and airframe components for delivery to customers worldwide.

Company spokeswoman Diana Galik says, “Polamer fits right in with the ‘Made in America’ concept. It is one of our core beliefs that the U.S. can bring manufacturing back home and compete on a global level.”
Chris Galik, her husband and president and CEO of Polamer, says his company is currently competing for contracts in the global marketplace.

“This legislation introduced by Sen. Murphy should result in more American manufacturing jobs,” Chris Galik said, “especially with aerospace manufacturers like Pratt & Whitney.”

Galik added that now that this hurdle has been overcome he hopes Congress will focus on tax reform for manufacturers.

Another New Britain manufacturer, B&F Machine, should benefit from “Buy American.”

“[Our] company stays relevant in the industry by working as a team with our customers and our employees,” says Mario Francalangia, B&F Machine’s general manager. “With more and more work going overseas, this team has been able to successfully continue to grow and help keep both manufacturing and jobs in our state.”

“For four decades, B&F Machine has been creating jobs in Connecticut,” said Murphy. “They take pride in the skills and abilities of their workforce, and have made it possible for so many of our state’s residents, businesses and manufacturers to thrive. The bottom line is that as homegrown companies like B&F Machine continue to grow and succeed, so will Connecticut’s economy.”

In Bristol, the manufacturing picture has been more challenging. Two years ago, Theis Precision Steel USA nearly shut down. But, with use of a new, German-made plating machine, Theis, one of the city’s oldest manufacturers, was able to expand and add a high-tech metal plating line at its Broad Street factory.
Murphy recently cited Theis as an example of an American firm “doing better against foreign competition, in part because the labor portion of the price of new products is less and less and less.”

Bristol Press reporter Steve Collins noted that for years Theis was one of the city’s top taxpayers. After facing possible demise in 2013, its switch to modern technology enabled the company to compete globally.
According to Murphy, in 2014, 83 percent of all the money spent through Buy American Act waivers and exceptions to the Buy American Act, $5.4 billion, was spent using the “outside the United States” exception. In the last four years, the United States has spent $50 billion on the “use outside the country waiver.”

Murphy said that by identifying the concrete effects of Buy American laws, “we can take additional steps to create new American jobs, bolster our country’s manufacturing sector and protect our national security.”
Murphy supports NDAA but says corporations have been exploiting the Buy American Act waivers so they could get parts cheaper from Asia. His amendment would tighten this loophole and require more American companies with defense contracts to buy American rather than foreign parts.

About “Buy American,” Murphy acknowledges that it’s in the “red zone,” needing one more key play to cross the goal line. In this case, the playmaker is President Obama.

The president could veto NDAA. If this happens, the measure goes back to Congress for a vote. Since the bill passed the House and Senate by comfortable margins, Murphy’s expectation is that Congress will vote to override a presidential veto and the amendment eventually will be signed into law. The only possible snag is that multiple members in both Houses could change their votes to sustain the president’s veto. If this happens, Murphy can attach the same or a similar amendment to another bill. However, he says he is optimistic that NDAA will be signed into law — another step in helping American companies, like Polamer and B&F Machine, prosper.