We're gonna need more pens... During his first week in office, President Biden has signed a whopping 33 executive orders. The latest: an order that'll force the US government to buy more American-made products. TLDR: the order makes it harder for federal agencies to import goods and services from abroad.
- $586B: How much the federal government spent on procurement contracts in 2019. Think: tech, construction, healthcare supplies, and weapons.
- ~5%: How much of that was spent on foreign products (aka: not much).
But this is just one step... toward fulfilling Biden's “Buy American” campaign pledge: a $400B increase in government purchases of American-made goods and services. That includes more American PPE (think: gowns and masks) — which could benefit everyone from 3M to smaller manufacturers like Shawmut Corp. But it also includes massive infrastructure investments (think: roads, bridges) — which could benefit Caterpillar and John Deere.
- Sound familiar? The idea behind Biden’s “Buy American” initiative is similar to former President Trump’s “America First” policy.
- Trump slapped tariffs on $250B of Chinese goods in 2018, making them pricier to import. The "protectionist" goal: protect US businesses by nudging companies to... buy American.
Expect “American-Made” to be a priority... for the next four years. Biden said he's in no rush to remove Trump's China tariffs. Treasury Secretary Janet Yellen promised to take on China's "abusive, unfair, and illegal practice" of undercutting US companies. While China's economy grew last year (partly thanks to exports), the US economy is shrinking — and ~10M+ Americans are still unemployed. That could spark more support in DC for "Buy American" proposals.