[Congressional Record Volume 143, Number 149 (Thursday, October 30, 1997)]
[Senate]
[Pages S11444-S11445]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       FTC ``MADE IN USA'' RULES

  Mr. ABRAHAM. Mr. President, as my colleagues no doubt are aware, I 
joined with Senator Hollings, to submit a concurrent resolution (S. 
Con. Res. 52) to reaffirm the Senate's support for the traditional, 
simple, and honest use of the ``Made in U.S.A.'' label. That use was in 
accordance with the long-standing rule that articles so labelled be 
made ``all or virtually all'' in the United States. Over two hundred 
members have cosponsored a measure similar to the Hollings-Abraham 
resolution in the House of Representatives, introduced by 
Representatives Bob Franks of New Jersey and John Dingell of Michigan.
  Senator Hollings, Congressman Franks and Congressman Dingell joined 
me in sending a letter to the

[[Page S11445]]

Federal Trade Commission urging that agency to maintain the current 
standard. As we said in that letter, ``Any definition or enforcement 
standard of `all or virtually all' that would allow more than a de 
minimis level of foreign content is unacceptable to us and, we strongly 
believe, would be unacceptable to the Congress.''
  Mr. President, I ask unanimous consent that the full text of this 
letter be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                Congress of the United States,

                                 Washington, DC, October 20, 1997.
     Hon. Robert Pitofsky,
     Chairman, Federal Trade Commission,
     Washington, DC.
       Dear Chairman Pitofsky: We are writing this bicameral and 
     bipartisan letter to reiterate our strong opposition to any 
     weakening of the standard for the use of the ``Made in USA'' 
     label. In light of recent press reports of possible 
     Commission consideration of a new proposal to lower the 
     ``Made in USA'' label standard to 89 percent U.S. domestic 
     content, we felt compelled to reiterate what growing numbers 
     of our colleagues in the Congress on both sides of the aisle 
     are saying: neither we nor the American people will tolerate 
     any lowering of the standard for the ``Made in USA'' label.
       In its proposed guidelines issued last May, the Commission 
     itself described the current standard as follows:
       ``Cases brought by the Commission beginning over 50 years 
     ago established the principle that it was deceptive for a 
     marketer to promote a product with an unqualified `Made in 
     USA' claim unless that product was wholly of domestic origin. 
     Recently, this standard had been rearticulated to require 
     that a product advertised as `Made in USA' be `all or 
     virtually all' made in the United States, i.e., that all or 
     virtually all of the parts are in the U.S. and all or 
     virtually all of the labor is performed in the U.S. In both 
     cases, however, the import has been the same: unqualified 
     claims of domestic origin were deemed to imply to consumers 
     that the product for which the claims were made was in all 
     but de minimis amounts made in the U.S.A.'' \1\
---------------------------------------------------------------------------
     \1\ Federal Trade Commission Request for Public Comment on 
     Proposed Guides for the Use of U.S. Origin Claims, Federal 
     Register, Vol. 62, No. 88, May 7, 1997, p. 25050.
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       Clearly, an 89 percent U.S. Content standard would allow 
     much more than a de minimis amount of foreign content and 
     therefore would lower the standard for the use of the ``Made 
     in USA'' label.
       We the undersigned introduced legislation in both the House 
     and Senate (H. Con. Res. 80 and S. Con. Res. 52, 
     respectively) to specifically condemn any lowering of the 
     standard for the use of the ``Made in USA'' label. H. Con. 
     Res. 80 has now been cosponsored by 219 Representatives, a 
     majority of the U.S. House (see enclosed cosponsor list). We 
     note that these Members do not just represent votes against 
     any weakening of the label. But are Members who felt strongly 
     enough about this issue to join with us as cosponsors of this 
     legislation. S. Con. Res. 52, while introduced only recently 
     is receiving the same favorable reception as its companion in 
     the House.
       The language of these Resolutions is clear and to the 
     point: ``Resolved by the House of Representatives (the Senate 
     concurring), That the Congress (1) maintains that the 
     standard for the ``Made in USA'' label should continue to be 
     that a product was all or virtually all made in the United 
     States; (2) urges the Federal Trade Commission to refrain 
     from lowering this standard at the expense of consumers and 
     jobs in the United States.''
       Any definition or enforcement standard of ``all or 
     virtually all'' that would allow more than a de minimis level 
     of foreign content is unacceptable to us and, we strongly 
     believe, would be unacceptable to the Congress.
       We urge you to reject any recommendation to lower the 
     current standard for the use of the ``Made in USA'' label and 
     to enforce vigorously the current standard.
       Thank you very much.
           Sincerely,
     John Dingell,
       Member of Congress.
     Ernest Hollings,
       United States Senate.
     Bob Franks,
       Member of Congress.
     Spencer Abraham,
       United States Senate.

  Mr. ABRAHAM. I have been informed that the FTC will soon make an 
announcement regarding the ``Made in USA'' label, probably next week. I 
am hopeful that the FTC will maintain the current standard, and urge my 
colleagues to contact the FTC to add their voices to the chorus calling 
for that decision.
  I believe it is crucial for American workers and the American economy 
that we maintain the integrity of the ``Made in USA'' label. For over 
50 years, consumer goods have worn this label when, and only when, they 
were made ``all or virtually all'' in the United States.
  But recently the (FTC) announced plans to soften that rule, allowing 
companies to use the label any product on which they spent 75% of their 
total manufacturing costs, provided the product was last 
``substantially transformed'' here in the United States. A product also 
could be labeled ``Made in USA'' if that product, and all its 
significant parts and other inputs, were last substantially transformed 
in the United States.
  In practice, this means that products containing no materials or 
parts of U.S. origin could nonetheless be labeled ``Made in USA.''
  I believe that would be wrong, These new rules would be a slap in the 
face to American workers. They also would in effect condone false 
advertising. Many Americans look specifically for the ``Made in USA'' 
label because they want to support American workers. These loyal 
Americans do not believe that they are purchasing products ``mostly'' 
made in the USA, let alone products for which ``most manufacturing 
costs'' were incurred in the USA, or which were ``substantially 
transformed'' in the USA. Quite rightly, consumers who look for the 
``Made in USA'' label believe that when they purchase a product with 
that label they are getting something made all or virtually all in the 
United States.
  Perhaps worst of all, Mr. President, these new rules will hurt 
American workers. Many companies have invested a great deal in plant 
and equipment, as well as hiring and training, in the United States. 
These companies have a right to expect that the ``Made in USA'' label, 
which they have worked so hard to earn and maintain, will continue to 
apply only to products made all, or virtually all, in the United 
States. If they lose that advantage, these companies may well decide to 
move some or all of their production--and American jobs--overseas.
  To dilute the requirement for use of the ``Made in USA'' label would 
be to lower the value of that label. It would allow companies operating 
substantially overseas to deceive American consumers who are attempting 
to support truly American made products and workers. It would 
discourage companies from investing in this country by telling them, in 
effect, that they will no longer receive any benefit for keeping jobs 
at home. The result would be a loss of American jobs and morale, as 
well as a critical blow to consumer confidence in the veracity of 
product labels.
  The American people have a right to expect that the ``Made in USA'' 
label will mean what it says. For over 50 years they have depended on 
that label to assure them that they are purchasing products made ``all 
or virtually all'' in the United States. I again call on the FTC to 
maintain the traditional standard for labelling products ``Made in 
USA,'' and urge my colleagues to do the same.
  I yield the floor.

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