Buy American Requirements
One of the key points of the policies is that all steel, iron, and manufactured goods for
construction purposes or any other related purpose should come from the United States’
manufacturing industries (Goehle, 1989). The Buy American laid down restrictions should
conform to the United States’ obligations through existing international treaties such as the Free
Trade Agreements and the World Trade Organization Government Procurement Agreement.
Apart from the equitable treatment of the foreign goods, the policy has a requirement within it
that allow the nation also to purchase the construction materials (Hufbauer, 2013). The New
Company is an aerodynamic defense contractor that is carrying out a lot of research and
development despite the high competition that it faces from Vector Cal. The company is still
ahead of Vector Cal because it utilizes the Buy American Act and all the Buy American
Requirements are used on the other side to the advantage of the company. This puts the
American defense department to work hard and catapults all the people to the lime light.
Buy America requirements are inclusive of the applicability, definitions, general
requirements, waivers, application of waivers and the state Buy America provisions. Rights of
parties, sanctions, intentional violations, grantee responsibility, investigation procedures, failure
BUY AMERICAN REQUIREMENTS 2
to comply with the certificate and the certification requirement for procurement of buses are all
Buy America Requirements. The Buy American requirement is a type of an act that was
established in 1933 and signed by president Hoover. Buy American Requirements is one of the
United States Code Section that is well known in the provision of the rule making authority in
the whole continent through the use of the public laws and the presidential documents. This act
applies to the entire US federal government agency that does not apply to any given service in
the whole state. Most of the municipalities of the state are inclusive of similar geographic
production requirements in most of their procurement legislation. A price preference is created
by the Buy American Requirements that is aimed at favoring all the domestic end products from
all the American firms in the federal government. Under this requirement, the expectations will
definitely be made by the head of the federal government mostly when the use of all the
domestic products is inconsistent with the public interest and is also likely to increase the cost of
the overall project with a high percentage. The Code of Federal Regulation (CFR) is also
applicable in the Buy American Requirement that will define the building work of the United
States government entity by means of the public works. The CFR is comprised of steel that is an
alloy of carbon and that considers all the manufactured goods in the whole state that might be of
high use when combined with raw materials to create a qualitatively quality material that is
different from the original one. CFR has to be made aware of all the goods produced in the
United States or those imported from other countries with the aim of bettering their quality of
production. There are expectations of the waiver that are evident through the use of Iron and
Steel and the component that is evident in the manufactured goods. All the United States
obligations under international agreements are also categorized under the Buy America
Requirement of the Waiver.
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Both Vector Cal And New Company is likely to benefit from the Buy American
Requirements since they will be able to have a ready market for their products. In return, these
companies will have a high bargaining power over their customers, resulting in more profits.
Consumers also not need to spend extra time or money so as to find and buy the American made
products (Kennedy, 2011). Buy American requirement also promotes the purchases of only
American products that, in this case, promote the growth of local industries such as Vector Cal.
They buy American requirement will help benefit these two companies by providing them with
the autonomy they need to penetrate the market. The legal protection is very important in
ensuring that the businesses do not suffer from a poor operating environment or suffer from
unscrupulous dealers. The buy American requirement is a step in the right direction that is meant
to ensure that businesses are legally protected from any forces that might interfere with their
operations.
To some extent, the buy American is contradictory to the American capitalistic ethos of
capitalism that demands that customers and business are free to sell or buy from wherever they
wish. This requirement is limited the freedoms of the American consumers by forcing them to
buy from particular local outlets. The U.S. espouses a free market ideology such that the price of
everything, the value of nothing. However, the measure does not take care of the changes in the
product’s quality or the value the labor that is not yet paid (Hufbauer, 2013). The buy American
requirements tend to dictate the forces of demand and supply by restricting other firms from
other places from enjoying the benefits that come with the free market. In this regard, the
external companies that would also want to take the advantage of the American market can find
themselves on the wrong side of economics since they would not be able to enjoy the free
BUY AMERICAN REQUIREMENTS 4
market. This would be unfair to other companies that come from other countries since their
market does not restrict the sale of goods and services by the American companies.
Towards the economy, the Buy American Requirement aims to reduce administrative
costs, thus makes businesses cost effective. In addition, the Buy American Requirements help to
improve opportunities for small, small disadvantaged, women-owned and veteran-owned, HUB
Zone. This policy instrument also promotes efficiency in doing business and promotes economic
development. To the American companies, the buy American requirements are important to the
American companies since it enables them to take advantage of their home market with limited
competition on the external market. In this regard, the local companies are shielded from the
external competition that would bring unnecessary competition in the market. The buy American
requirement would help the preservation of the rich American market to the domestic companies,
which would in turn benefit from their local market as they also seek other opportunities in other
countries. The growth of the domestic companies within the American market would lead to
increase in the taxable income and more money for the government. In addition, the growth of
the local based companies would lead to more job creation to the local population, leading to the
overall growth in the American economy.
Buy American enhance the support of American manufacturers and the workers, their
working conditions, and also the child labor laws. The reason behind is that foreign labor
standards in most countries do not provide for safe working conditions. The policy also
contributes to the growth of the American economy through buying of the American home made
goods. The rationale for this is that shipped jobs always go forever with no element of returning
in the near future (Kennedy, 2011). Since goods produced for the United States are
environmentally friendly as compared to other countries that produce the same commodity,
BUY AMERICAN REQUIREMENTS 5
buying an American good in this instance promotes the conservation of the natural environment.
In this instance, buying the American home made goods promotes the fair payment of the
workers for what they deserve after their service to the nation. Since the country cannot
manufacture all goods at ago, by buying an American good in this instance, promotes their drive
towards creativity and innovation in the industrial manufacture of goods. In most of the
occasions, foreign products do have low quality. As a result, the buying of the American
products promotes the exploitation the consumers from the exploitation of such low-value
products from other nations (Hufbauer, 2013). Buying an American product promotes peace in
the nation simply because it helps in avoiding the goods from those nations that are political
enemies of the country.
Buy American Requirement also has some limitations. It does not only leads to
prosperity, but also leads to loss of jobs of the Americans that in the end makes them poorer than
they were even before. Such loss of jobs would easily come due to the exit of the foreign based
companies that would suffer from the implementation of the buy American requirements. Buy
American Requirement policy leads to the production of items that are so expensive for the local
man to acquire. This is possible since the requirement can easily result into monopolization from
the corporate firms that would greatly benefit from the implementation of such requirements.
Many citizens have to use their little resources to acquire the other bigger items produced by the
home companies that, in this case, make them much poorer in their lives (Noorzoy, 1968). The
major benefit is that the buy American requirement would help the VectorCal and Remote
Control Unlimited Company to find a ready market with limited competition. On the other hand,
the buy American requirement can be disadvantages to VectorCal and the new company in that it
can limit their markets to the American population, making them forget on internationalization
BUY AMERICAN REQUIREMENTS 6
processes. Moreover, the company would benefit due to increased legal protection from the
government.
References
Goehle, D. (1989). The Buy American Act: Is It Irrelevant in a World of Multinational
Corporations? Columbia Journal of World Business, Vol. 24 Issue 4, p10-15
Hufbauer, G. (2013). Local Content Requirements. Washington, DC: Peterson Institute for
International Economics.
Noorzoy, M.S. (1968). Buy American as an Instrument of Policy. Canadian Journal of
Economics. Vol. 1 Issue 1, p96.
