[Note: This is article 1 of 2]. If you turn on your television, you will be bombarded with political jargon, mostly about the economy and how politicians plan to create more jobs. It is interesting banter, at best, and a great way to start pondering what will in fact turn the national and local economies around. With everyone weighing in, many economists agree that the creation of jobs itself is not the answer. But the creation of jobs surrounded by communities of people committed to buying American products and supporting American businesses can slowly and steadily turn our economic state around.
Why Buy American?
There are obvious reasons to purchase American made and manufactured products. But the average American needs to be aware of the widespread impact locally and nationally of citizens committed to supporting American owned and operated companies. Here are some reasons that we should all strive to do our research and do our part to buy American:
1. To keep and create American jobs. Here is an obvious point: when a business is doing well and demand increases, so does the need for a workforce. It is essential that any type of job creation these days arises from companies who are American owned and operated so that our workers can go back to work, but also so that tax dollars are generated. Job creation can be contagious. As American owned and operated companies become more successful, they have the opportunity to create more competition among existing businesses within their industry. This used to mean outsourcing, but because of current world economic conditions and new tax plans that are being discussed, this could mean bringing a lot of the outsourced work back home. Supporting an American owned and operated business not only supports our local labor force, but it challenges others within similar competing industries to re-employ American workers.
2. To promote American independence. Existing American businesses have lost the ability to satisfy all of their manufacturing, consulting, and other business needs domestically. Because many businesses chose to outsource various operations in pursuit of cheaper labor, less restrictive working standards, and tax shelters, these businesses slowly became reliable on foreign business components to complete their tasks. For example, an American car manufacturer may have plants here in the U.S. and be committed to be “American-made,” but the reality is that there are parts to its operation that are satisfied by foreign businesses. This can all be changed. Slowly and steadily we can stimulate the domestic economy by encouraging businesses to buy from each other here in the United States. The American people can support American owned and operated businesses that are committed to finding different ways to operate domestically, rather than relying on foreign counterparts.
3. To ensure our goods are produced at a high standard. Morally, economically, and scientifically, it is crucial to buy American as our foreign counterparts do not hold manufacturing and production to the same standards as the American government requires. Foreign entities do not enforce labor safety standards or child labor laws as we do in the United States. Many countries lack environmental standards that ensure safety for the workers and the surrounding community. Further, product safety standards differ among countries, allowing products to be shipped into our country and sold on our shelves containing toxins and ingredients that are unacceptable and unlawful. Buying American made products ensures that higher standards would be met by adhering to the laws and safety standards of the United States. By following these environmental standards, our end product may cost more than foreign products, but the end product will have a higher quality than others. It puts pressure on the global market to come to terms with the safety standards and practices that we have in our newly competitive market. But whether the global market chooses to make improvements or not is still in question.
4. To ensure a living wage. Buying American products reduces the trade deficit. As we are able to bring more jobs home, not only will our job opportunities increase but the U.S.’s economic growth will gain momentum. As we rely more on domestic products and manufacturing, our businesses will be able to function more effectively, meeting our domestic needs, reducing our reliance on imports, and spurring more economic growth. It will encourage other businesses to follow suit, creating new opportunities to meet this new demand. We will begin to see both our domestic demand and domestic employment grow. We will also begin to see not only the creation of jobs, but employers will once again be afforded the opportunities to provide living wages, benefits, and opportunities for advancement to its employees.
Where do profits go when we buy American? To Benefit All American People.
It is easy to see the face value of supporting American businesses. But the effects of our support are so much more far reaching than we can initially see. As easy as it is to see the face value of our support, it is equally as easy to become cynical non-supporters of the buy American effort. The reason for the cynicism comes from not knowing where the profits are going. Becoming a more educated consumer and patronizing businesses committed to be owned and operated in America keeps the profits here in the U.S. to stimulate the economy and contribute to our government.
In addition to the above stated reasons for buying American, our support is so important because of the tax dollars that these business pay. The profits earned by domestically owned and operated companies benefit Americans nationally and locally. American owned business profits are taxed and go into the funds for Social Security, military/national defense, education, and health care and welfare programs. Basically, any government run program relies on such taxes for its very existence these days. The profits also get funneled into our local economies through taxes as well. Money is allocated to support our local governments, funding fire fighters, police, and other government funded jobs. Not only do these companies generate tax dollars, but American owned and operated business three times as much tax to operate in America as do their foreign counterparts. Therefore, the amount of profit-generated tax money is substantial.
To put things into perspective, we must consider the reality of the current trade market. “In just the last 10 years the United States has lost out on approximately $2 trillion in cumulative trade deficits with China alone. Had that $2 trillion of forfeited production taken place in America, it would have generated — based on a conservative 30 percent tax rate — $600 billion of national revenue and created millions of jobs in the United States.”- Peters, Eric, “Building by Buying American” July 25, 2011, NYtimes.com.
What does the American consumer need to know in order to support this kind of business? We need to be aware of who owns the business to make sure we know that these profits are being dispersed here in the United States. And by patronizing these businesses, not only would we be supporting our government through tax dollars, but at three times the rate than if we patronized their foreign owned/operated competition. We must do our homework and support businesses with a commitment to keep operations here in the U.S. so that we can assure that those profits are redistributed through tax dollars. This means supporting businesses that not only make products in America, but are based here so that not only their business, but their profits benefit our country.
We must be aware that every citizen will benefit from the buy American movement. If you have ever needed the assistance of a federally funded school loan, rely on social security, or have dialed 9-1-1, you rely on the tax dollars from American businesses. We are living in a time of depleted funds, stricter requirements, and longer response times. This can change. Our economic, social, and safety security can all be restored. We the people have always had the power to generate change.
The answer to our current economic crisis is simple, but it requires an educated, committed consumer: buy American. By doing so, we can decrease the trade deficit, create jobs, reduce our foreign reliance, and ensure that our national and local governments are supported by these profitable companies.