Today President Trump will sign an executive order aimed at helping to fulfill his Buy American/Hire American campaign pledge.
The order has two parts. The first is cracking down on the ability of foreign companies to compete for federal contracts.
Commerce Secretary Wilbur Ross will coordinate an effort across all government agencies to root out weak monitoring, enforcement and compliance efforts relating to procurement practices, the official said. Ross will then advise Trump on how to close any existing loopholes in a report due 220 days from now — Thanksgiving Day — though the official noted recommendations could also come sooner.
The executive order will also direct the Commerce Department and the Office of the U.S. Trade Representative to “comprehensively assess” the procurement provisions of trade agreements, which allow foreign companies to bid on U.S. government contracts, in an effort to “determine which deals may actually be working for America and which may not,” the official said.
“It is simply unfair for government contracts to be awarded to low bidders that use dumped or injuriously subsidized, foreign-source content to push out domestic producers,” the official said. “This portion of the executive order is an innovative step to stop the foreign cheaters from using taxpayer funds to steal our jobs, to shutter our steel mills and offshore our factories.”
Generally speaking, I’m not opposed to federal contracts being limited to US headquartered companies. Civil service positions are limited to US citizens so I don’t see why federal contracting should be different. Why would the federal government, for instance, want to buy Chinese routers that may be compromised? But even without a blanket ban, there needs to be pressure placed on federal contracting officials to not allow bullsh** product specs steer contracts out of the US and to foreign companies. How does that work? When the Army decided to make the black beret the symbol of mediocrity back in 2000, they put a spec in the contract that required that all the berets be constructed in one piece. This spec prohibited the only US beret manufacturer, Bancroft, from bidding on the contract and the contracts were initially awarded to companies mostly located in China. This despite the existence of the Berry Amendment which mandates that Defense contracts be given to US firms.
The second part of the executive order is focused on cracking down on the endemic abuse of the H1B visa scam.
The order will also direct the departments of Labor, Justice, Homeland Security and State to examine their various programs and explore various ways to crack down on “fraud and abuse … in our immigration system in order to protect workers in the United States and their economic conditions.”
While the order broadly calls for greater enforcement of all visa programs, the official said only one is specifically mentioned by name: the H-1B visa program, which allows companies to bring highly skilled foreign workers to the U.S. on a temporary basis.
The official criticized the H-1B system for awarding visas randomly, without taking into account an applicant’s skill or salary level. “The result of that is that workers are often brought in at well below market rates,” the official said.
While I am all in favor of US companies being able to hire top-shelf talent from anywhere in the world my tolerance ends when it comes to using H1B visa holders in entry level jobs or displacing US workers currently doing the work with H1B visa holders. Right now most US STEM grads do not work in STEM jobs. That is fundamentally wrong. We are engaging in the agricultural practice known as “eating your seed corn.” Because we are displacing entry level tech workers with indentured servants, we aren’t growing the experienced STEM workforce the nation needs to compete. That problem is imminently fixable and it is great to see someone focusing on it.
It is important to note that in both cases, the executive order requires the problems to be studied. So, in practical terms, he hasn’t changed anything. But, like with immigration, this order seems to emphasize that current laws be obeyed. And that is a good thing.