Federal Trade Commission
Received Documents
P894219
Nov 17 1995
B18354900007


Harold Tuchel  
1040 Fleur Dr  
Waterloo, Iowa 50701
ht11081@cedarnet.org

 
      SUBJECT: FTC..COMMENTS REGARDING "MADE IN USA"

    
  This is written comment to the FTC regarding made in USA labeling subject
 to FTC rules. The writer of these comments is both a consumer and employed
 in manufacturing. My interest is to ensure that the label "Made in USA"
 remains an accurate guide to the consumer. If the "Made in USA label"
 continues to be an accurate guide to both the foreign and domestic consumer
 those that have a preference for American made goods will spur domestic job
 creation and employment. It is certain that parties both domestic and foreign
 will wish to dilute this signature of American production in order to sell
 products produced partially offshore or made in America with foreign parts.
 This multinational approach should be resisted firmly, since the interest of
 the FTC is and should be the interest of the American consumer and not of
 monied multinationals.

   The FTC commissioners seek quantitative data to questions asked for this
 comment subject. Although such studies could be financed and even skewed 
 with clever survey questions, to citizens of the U.S. the answers should be
 intuitive if not actually obvious. Pride in American workmanship and the pride of being an
American citizen and  working for American citizens interests should bring about obvious
answers!

   There still exist a great many American consumers who realize the worth in
 purchasing American goods if they can find them at competitive price and
 quality. In order to purchase such goods they will have to be assured that
 foreign goods or goods of predominantly foreign origin do not fall under
 such a label, or they will become cynical about purchasing U.S. goods.
 
  A. When consumers see "Made in USA" labels does this imply that the product
 was indeed made in the U.S.

    In my opinion consumers do expect that a made in the U.S. label indicates
 that the goods where produced fully in the U.S. A potential problem is that
 with the large U.S. multinationals purchasing foreign parts in great amounts
 the U.S. label will be used where foreign made parts are installed or
 predominate. The public is aware of this and is somewhat cynical on the
 made in U.S. label in electronics, computers, printers, and even automotives.
 I would disagree with commissioner R Stareks position on individual
 enforcement, I feel that if the situation was studied more carefully he would
 find that certain industries flagrantly violate the "Made in USA" label.
 I feel that whatever the industry the consumer has the right to expect 100%
 American manufactured goods in a product if the manufacture wants to apply
 a "made in USA" label.

  B.  What are the costs and benefits of a virtually all threshold versus a
      50% or lower threshold

  The cost of a lower threshold versus a virtually all threshold is threefold.
  The primary cost would be public skepticism of the made in USA label and
  cynicism resulting in a counterproductive image. This counterproductive
  image of the Made in USA image would result in less focused buying of U.S.
  products by those that choose to focus on U.S. goods. The consumer that
  purchases U.S. goods does so for a variety of reasons, employment in the
  U.S., confidence in U.S. goods, warranty reasons, and U.S. brand loyalty.

    The second cost of lowering the threshold of content could be U.S. jobs
  as manufactures actually purchase cheaper foreign parts to meet the content
  ceiling. Such purchase of foreign parts could be quit economical if perhaps
  a 50% threshold were established. This again could cost Americans jobs!

    The third cost of lowering rather than raising a threshold could be a new
  perception that the "made in USA label" does not indicate quality! The label
  now carries a connotation that the U.S. manufactured product is of a high
  quality. If parts of foreign manufacture are allowed under a higher threshold
  there could be the perception that products have been cheapened, so why not
  purchase the foreign made product anyway. This could be counterproductive to
  a "made in America " campaign or label!

  C. What do consumers understand the phrase "Assembled in the USA" to mean!

     I feel a study of this label would indicate that consumers are confused
  by the label and unless otherwise labeled do not understand what U.S. content
  is in the product. Since the term is ambiguous and may mean a variety of parts
  where used a manufacturer should be required to label the percentage of
  foreign parts used in the manufacture of the item!

     Where minimal assembly is required or the product is only packaged in the
  U.S. the manufacture should be required to label the country of origin and
  NOT brand the product with U.S. at all. The commission should note that a
  great many products are labeled in large letters "packaged in the USA" and
  have in very small letters on the reverse side the country of origin. This
  is an obvious ploy to confuse the consumer and gain false good will!

  D. How should the proportion of domestic content be measured

     The measure of content is the most difficult issue. The easy measure of
  content would be to use parts dollar value as a measure of content. This
  could be very deceptive because of exchange rates and cheap foreign parts or
  goods. By measuring by dollar value the actual content of a U.S. made device
  could easily be predominantly foreign. The overwhelming value of a single
  American part could falsely skew a predominantly foreign device as U.S. made.

      The best measure for assembled goods would be the percentage of parts
  in the complete product that where produced in America. The criteria for
  larger assembled device would not only have to be percentage of parts, but
  also value or function. Obviously an automobile with a foreign engine should
  be considered at least 50% foreign since the major and most important function
  is the engine, and the engine is one of the major value components.

  E. What guidance should the commission offer on enforcement

     It has not been well publicized that the commission has much enforcement
   authority and can penalize for misuse of the label. The general public is
   not aware of such enforcement, nor has congress or the commission seen fit
   to publicize this to the general public. If such notification was made to
   the public it did not reach Iowa, and this writer is not aware of it! The
   only agency that has publicized the "made in USA label" has been the Unionized
   Garment Workers to any great degree!

     The commission should be working with customs to ensure that goods branded
    made in America are not arriving from foreign shores.
    A case by case basis presumes that the average American is aware that he can
    petition the FTC for relief if an item was found to be predominantly foreign
    after purchase. This is exactly what industry would desire since the consumer
    is unaware that the commission has an enforcement power and a consumer can
    petition to the commission. It is my feeling that before the commission can
    presume to allow case by case enforcement it should be aware of deficiencies
    in two areas.

      The first area  the commission should more closely follow is an industry
    by industry study. Although this study would not have to be of great detail
    or cost, it could quickly highlight any industry wide infractions. If there
    were any industries found were infractions are high remedial instruction could
    be provided to those industries prior to a penalty phase. 

     The second area that the commission should follow more closely is the
    consumer. If the "made in U.S.A." label is to be viable and a positive goal
    the consumer needs to be made aware that the label can be trusted and that
    the consumer has enforcement petition options. If the consumer is not aware
    that enforcement is a possibility obviously such a label comes to mean very
    little, since the consumer may feel it is taken advantage of.

    The reason I have furnished these comments to the FTC is that such comment
   sessions usually are skewed by multinationals and big business. The made in
   USA label is not to promote either multinationals or big business, but a
   guide to consumers to buy American products. Since I am both a consumer and
   employed by an American Manufacturer I have a great interest in such rule-
   making. This label should so effectively promote American interests that it
   is both admired by foreign interests as an effective sales tool, and heavily
   and adamantly lobbied against in congress by the same foreign and
   multinational interests. When that situation occurs the "made in USA" label
   will rise to the same or higher stature as the made in Japan label.

       Respectfully Yours
       Harold Tuchel
       Industrial Electrician
       Manufacturing