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July 19, 2012
In the U.S. Congress, more outrage over the U.S. Olympic team wearing uniforms manufactured in China. Some lawmakers directed their anger this week at the proposed Trans-Pacific Partnership free trade agreement that could lower tariffs on footwear imports.
Now that the U.S. Olympic team acknowledges wearing uniforms made in China, there's new pressure on President Obama to preserve tariffs on the import of footwear from low-wage countries.
Representative Michael Michaud of Maine supports the current import tariffs of 8 to 37 percent on shoes made in Indonesia, China and other countries to offset government subsidies in those places. But he is most concerned about Vietnam, because it is part of the Trans-Pacific Partnership free trade agreement currently being negotiated.
"Anytime you negotiate a trade deal, for me is how do we make sure that whatever countries are part of that negotiation, what do they do currently, whether it's environment, labor or currency manipulation, and how do we make sure we have a level playing field," said Michaud.
In Michaud's district in Maine, three New Balance footwear manufacturing facilities operate and employ close to 900 people. New Balance President and CEO Rob DeMartini says all other things being equal, his company can still make a profit producing 25 percent of its products in the U.S., where workers earn close to $20 an hour, compared with the $5 a day workers in developing countries often make.
"We don't need wages level," said DeMartini. "We need the full playing field level, and, when we do that, even though our labor costs are as much as 20 times higher per hour, we still have found a way to make productive and profitable shoes here in the U.S.
But he says without the tariffs, New Balance and many other remaining American manufacturing companies will most likely have to outsource their operations, and chances are future U.S. Olympic gear will not be made in the United States.
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