Federal Trade Commission Received Documents Jan 16 1996 B18354900048 Secretary Union Label & Service Trades Department, AFL-CIO 815 Sixteenth Street, N.W. Washington, D.C. 20006 (202) 628-2131 Office of the Secretary January 16, 1996 Federal Trade Commission Room 159 6th St. and Pennsylvania Ave. N.W. Washington, D.C. 20580 Made in USA Workshop -- Request to Participate FTC File No. P894219 Dear Mr. Secretary: This is the request of the Union Label & Service Trades Department, AFL-CIO, to participate in the Made in USA Workshop that the Commission has scheduled for March 26 and 27 (plus, possibly, March 28) in Room 432 of the Commission's headquarters, as announced in notices published in the Federal Register on Oct. 18, 1995, and Dec. 19, 1995. The UL&STD's comments on the questions at issue in the workshop (six copies) are contained in a separate document enclosed with this request. This letter and our comments also are contained on the enclosed computer disk. We ask to participate in the Workshop as the arm of the American Labor Movement that has since early in this century been directed solely to encouraging the American populace to "Buy Union!" and to "Buy American!" Seeing hundreds of thousands of Americans' jobs exported overseas during the last 15 years has caused us to give "Buy American!" nearly equal emphasis with "Buy Union!" We now urge shoppers to look first for the union label, and then, if they can't find it, to look for the "Made in USA" label. By supporting American-made products, we aim to help keep Americans working. We thank you for your attention. Sincerely, Charles E. Mercer 202-628-2131 (Voice) Secretary-Treasurer 202-638-1602 (Fax) CEM:jmc/tng3 The "Made in USA" Advertising & Labeling Standard FTC File No. P894219 Comments by Charles E. Mercer, Secretary-Treasurer, Union Label & Service Trades Department, AFL-CIO January 16, 1996 Notice that the Federal Trade Commission is considering diminishing its standard for use of "Made in USA" in product advertising and labeling made us feel that somehow we suddenly had been transported to Oceania, the fictional, totalitarian nation of George Orwell's novel, "1984," published in 1949. There, we found ourselves in the "Ministry of Truth" building, which had the three slogans of The Party carved into its facade: "WAR IS PEACE "FREEDOM IS SLAVERY "IGNORANCE IS STRENGTH" Inside the Ministry, we listened to Syme, a co-worker of the novel's hero, Winston, as Syme reminded Winston of the nature of their work in the Ministry or Truth. Syme is a specialist in "Newspeak," the official language of The Party. The Party's slogan (above) is in "Newspeak." "We're destroying words -- scores of them, hundreds of them, every day," Syme said. "... You haven't a real appreciation of Newspeak, Winston. ... You don't grasp the beauty of the destruction of words." "The destruction of words," and more, it seems to us, would be the result should the Commission diminish, or dilute, its standard for use of "Made in USA" in product advertising and labeling. That standard -- requiring that a product be composed of all or virtually all domestic parts and labor, as we understand it -- now is clear and easily understood. It is a standard that essentially holds that the words "Made in USA" mean what they say. We believe that the words mean what they say. We are convinced that the vast majority of the members of American unions believes that the words mean what they say. We are convinced that the vast majority of the populace at large believes that the words mean what they say. And there is strong evidence that because of the widespread belief that the words "Made in USA" mean what they say, the use of those words in advertising and on product labels has a steadily increasing, and not inconsequential, commercial value. Some examples of consumers' belief in "Made in USA": A survey by the Gallup Organization in the spring of 1994 for the International Mass Retail Assn. showed that, overall, 84% of Americans are more likely to buy U.S.-made products than imported versions of the same items (32% strongly agree, 52% moderately agree). Also, according to the same survey, 64% are more likely to buy U.S.-made products even if their price is 10% higher (19% strongly agree, 45% moderately agree). A survey performed for the Crafted With Pride in U.S.A. Council, Inc. (which is no fan of unions), during the 1993 Christmas holiday season confirmed earlier Council-sponsored polls that U.S. consumers prefer U.S.-made home textile and apparel products. Women respondents who purchased U.S.-made items expressed great satisfaction with the products at a 74% rate. This contrasted with women respondents' overall satisfaction rate of 54% with both imported and U.S.-made items. The same pattern was apparent among men consumers, the Council reported. A retail sales test conducted a year earlier for the U.S.A Council at stores in Nashville, Tenn., and Cincinnati, Ohio, showed a net 24% increase in sales of U.S.-made items during a 12-week period when they were prominently tagged as such but no other effort was made to increase their attractiveness to consumers. U.S.-made items priced at or near parity with their imported counterparts showed sales gains of 34%. A poll last year of readers of Union Plus magazine showed that 90% are interested in more information about the identities of union-made, American-made products. Also, a recent poll by the Center for Ethical Concerns of Marymount University in Arlington, Va., showed that U.S. consumers would pay an extra $1 for a $20 garment to ensure that the workers who produced it were protected from exploitation by their employers. Worker exploitation, we all know, has become almost synonymous with imported garments. Nor is the sales appeal of the "Made in USA" label confined to this continent's shores. An article in the January 1994 issue of Export Today reported that Levi Strauss and Wrangler jeans carrying the U.S.A.-origin label brought "three times the retail price of the identical product manufactured by the same companies in Europe." It is our observation, also, that the commercial value of identification of an item in some way with domestic production, however tenuous, has brought forth in recent months increasingly imaginative labeling. Why else the label a colleague reported recently seeing on a household appliance that read: Engineered in U.S.A. Made in Mexico. Or the labels an acquaintance who is a screen printer reports finding more and more often on the blank T-shirts and sweat shirts that he obtains for printing. Labels that read something like, U.S.A. materials. Made in Jamaica. Why else do large retailers like Wal-Mart spend so many advertising dollars trying to lure customers to their stores with slogans like "Bring It Home to the U.S.A."? The implication of Wal-Mart's ads, of course, is that most of their merchandise is U.S.-made. The falsity of that was dramatically demonstrated last year at one of the non-union chain's stores in the Buffalo, N.Y., area. A Food & Commercial Workers local union offered cash prizes to consumers who in a one-hour period found and listed the greatest number of foreign countries from which merchandise in the store was imported. The first-place winner found and listed 40 countries. That's one every 90 seconds. Then there are the five companies in North Carolina that illegally sewed "Made in USA" labels onto designer T-shirts, neckties, work gloves and embroidered identification emblems and patches that were in fact imported from India, the Dominican Republic, Taiwan and China? Convicted of customs-law violations, the companies and their officers paid fines that totaled more than $325,000. One firm's president was sentenced to five months in jail. There is, by the way, a question not posed by the Commission which we believe is highly pertinent to consideration of the "Made in USA" standard. That question is: Who wants the standard diminished? Who wants it diluted or weakened? And Why? Is it the same companies that in recent years have destroyed jobs in the United States by the hundreds of thousands by taking substantial parts or all of their manufacturing operations to the Third World in their relentless quest for ever lower wages and higher profits? Have these companies now become aware of the commercial value of the "Made in USA" label? Are they now trying to create a "Newspeak" standard for use of the "Made in USA" label, a diluted standard that would enable them to reap the commercial benefits that have come to accrue to the label's use? We do not think that general statements about globalization of the economy suffice. And who benefits from the sub-poverty-wages in the manufacturing plants that have run away to the Third World? Certainly not the U.S. consumer. The consumer most often finds prices the same for identical imported and domestic goods. In the increasingly rare instances where one -- domestic or imported -- is priced higher than the other, the higher price tag now is likely to be on the import, particularly clothing. We recognize that there are U.S. industries whose products are assembled in the U.S. of both domestic and foreign-made products -- most notably the automobile industry. Any problem that might have existed there, however, has been taken care of by the labeling law that took effect with the 1995 models that requires a "Parts Content" label to be displayed on each vehicle. The label clearly states the location of the final assembly point and the percentages of U.S./Canadian- and foreign-made parts. No potential buyer has to wonder about the source of the vehicle he or she is considering buying. Perhaps the Commission should require a similar label for other products that do not merit the "Made in USA" label under the "all or virtually all" standard. There already are, of course, labels that read more generally, "Made in USA of foreign and domestic parts," or components. When American consumers see a "Made in USA" label, they rightly expect it to mean what it says. And the "all or virtually all" standard -- using the dictionary definition of "virtually" -- seems to uphold that expectation. When American consumers see an "Assembled in USA" label -- as opposed to a "Made in USA" label -- they undoubtedly expect that there are a substantial number of imported components. To dilute the Commission's standard for the "Made in USA" label would be to engage in the "doublethink" employed by The Party in Orwell's "1984." Orwell explained "doublethink" in an appendix to the book. It is, he wrote, "To tell deliberate lies while genuinely believing in them, to forget any fact that has become inconvenient, and then, when it becomes necessary again, to draw it back from oblivion for just so long as it is needed, to deny the existence of objective reality and all the while to take account of the reality which one denies -- all this is indispensably necessary." -30- Voice: 202-628-2131 Fax: 202-638-1602 CEM:jmc/tng#2