2013-06-04

Cato: Why NOT Make Olympic Uniforms in China?

Patriotism, it has been said, is the last refuge of scoundrels. Indeed, with 86% of the American public disapproving of Congress’ performance, refuge-seeking politicians have wrapped themselves in the flag to denounce the fact that the U.S. Olympic team’s uniforms were manufactured in China.
Senate Majority Leader Harry Reid, D-Nevada, said he was “so upset… they should take all the uniforms, put them in a big pile and burn them and start all over again.” House Speaker John Boehner, R-Ohio, clucked of the Olympic committee at a news conference that “You’d think they’d know better.”
To prevent such abominations in the future, six Democratic senators plan to introduce the “Team USA Made in America Act of 2012” next week. According to co-sponsor Sen. Kirsten Gillibrand, D-New York, the legislation will mandate that “(f)rom head to toe, Team U.S.A. must be made in America.” (The U.S. Olympic Committee announced Friday that it was too late to remake the uniforms for the London Games, but said the U.S. clothing for the 2014 Winter Games would be made in the U.S.)
Perhaps the Beltway crowd can be forgiven for scoring some easy political points in election season, and the “scandal” will eventually burn out. But of greater concern is the lack of aptitude for basic economic and trade realities demonstrated by our leaders’ remarks.
Trade is not a competition between “our producers” and “their producers.” In fact, U.S.-based firms benefit from collaborating with foreign firms by carving up the production process into distinct functions and processes that suit each location’s efficiencies and strengths. Just as trade enables U.S. consumers to benefit from lower-cost final goods, globalization enables U.S. producers to benefit from access to lower-cost resources put into the manufacturing system. That enables them to compete more effectively at home and abroad.

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