| President Obama has spoken eloquently and often | | | | this contract would have created 250 new, |
| about his determination to create jobs in America, | | | | high-paying jobs in our plant, and an estimated |
| and to curtail the practice of sole-source | | | | one thousand additional jobs in our supply chain, |
| procurement at the Pentagon. But it would appear | | | | since 100% of our product content is American |
| that the Department of Defense hasn't been | | | | made. |
| listening. | | | | So, in the midst of war and economic recession, |
| Our company, Infrastructure Defense | | | | the DLA has chosen to stick it to our soldiers, |
| Technologies, LLC ("IDT"), is a manufacturer of | | | | taxpayers, workers and industrial base in one fell |
| protective barriers for the U.S. Military. We have | | | | swoop. They have also disregarded two of |
| seen firsthand the manner in which the Defense | | | | President Obama's key initiatives: The creation of |
| establishment is destroying the National Defense | | | | jobs, and the end of sole-source monopolies on |
| Industrial Base by doling out sole-source contracts | | | | defense expenditures. |
| to foreign companies amid the trials of war and | | | | Nicely done, DLA. |
| economic depression. Following is the story of | | | | There is no shortage of stories about contracting |
| our company, and a recommendation to the | | | | problems at the Department of Defense, where |
| White House on how to fix the continued practice | | | | many of their largest suppliers are foreign entities. |
| of outsourcing the Pentagon at the cost of | | | | The recent KC-X tanker battle between |
| American jobs and manufacturing on the home | | | | American based Boeing and European Aeronautic |
| front. | | | | Defense and Space represents a case-in-point. |
| Protective barriers are a mainstay of the military | | | | But how do we solve this issue of the Defense |
| supply chain, and are deployed at every American | | | | Department's coddling of foreign companies at the |
| base throughout Iraq and Afghanistan. For the last | | | | expense of American jobs and industrial security? |
| seven years, the Defense Logistics Agency | | | | The answer is surprisingly simple, and it's called |
| ("DLA" - the support agency of the Department | | | | the Buy American Act. |
| of Defense charged with supplying protective | | | | The Buy American Act sounds like a great |
| barrier equipment) has purchased over $1 billion | | | | provision, but like most things political, its meaning |
| worth of these products from a foreign | | | | has been diluted over time. The Act was signed |
| company, on a sole-source contract. What's | | | | into law by President Franklin D. Roosevelt in 1933, |
| worse, our government has paid for these | | | | and required the United States Government to |
| purchases in foreign currency, at an unfavorable | | | | prefer U.S .made products in its purchases. Fast |
| exchange rate to U.S. Taxpayers. | | | | forward to 2010, where countries allied with the |
| In 2008, the DLA was ordered by Pentagon brass | | | | United States by treaty or trade agreement are |
| to find alternatives to the foreign barrier products | | | | permitted to compete for U.S. Government |
| for the purposes of breaking the sole-source | | | | procurements on an equal footing with American |
| monopoly, finding better protection for our | | | | businesses. |
| deployed troops and increasing the longevity of | | | | The practice of allowing foreign entities to bid for |
| service in the field (the foreign product was | | | | American contracts as equals with American |
| reported in a U.S. Air Force Memorandum as | | | | companies cannot be justified in the face of |
| "failing in as little as six months to one year"). | | | | empirical evidence which illustrates its absurdity. |
| The DLA responded to the Pentagon order by | | | | While supporters of unrestricted free trade are |
| conducting a competitive solicitation for barriers, | | | | quick to point out that international agreements |
| which required that protective characteristics and | | | | are reciprocal, two examples nullify their |
| technical capabilities would be the most important | | | | argument. First, the U.S. Government purchases |
| criteria of evaluation. The winner of the | | | | far more than any other nation on Earth, which |
| competitive process would be awarded a four | | | | makes justification of reciprocity on equal terms |
| year contract worth $400 million. | | | | impossible on the grounds of parity. Second is |
| IDT's barrier product was judged by the Defense | | | | America's trade deficit, which is killing our |
| Logistics Agency to offer the best protective | | | | competitiveness, harming our currency and |
| benefits to the U.S. Military. Our Technical Proposal | | | | weakening the overall economy. |
| was rated best among all offerors, and our price | | | | Consider for a moment the benefits of true |
| was determined to be "fair and reasonable". Yet, | | | | preference for American-made goods in the |
| despite these facts, the DLA rewarded the same | | | | government procurement system. Contracts to |
| foreign company it had been sole-sourcing for the | | | | U.S. businesses will create jobs, which will in turn |
| previous seven years, thus continuing their | | | | create new taxpayers and reduce unemployment |
| monopoly status in the military supply chain. | | | | rolls. Domestic procurement will stimulate capital |
| IDT promptly filed a formal bid protest with the | | | | expenditures on durable goods such as machinery |
| Government Accountability Office ("GAO"), and | | | | and equipment, thus stimulating downstream |
| asserted that the foreign company was ineligible | | | | productivity. U.S. businesses pay income taxes on |
| for award because they failed to meet the | | | | their profits, whereas foreign entities use our |
| requirements of the DLA's solicitation. The DLA | | | | money to pay taxes in their own countries. |
| responded to our protest by petitioning the GAO | | | | Finally, present-day prosperity breeds future |
| to dismiss our protest in order that they may | | | | ingenuity through research, development and |
| take "Corrective Action"….presumably to correct | | | | expertise (formerly referred to as American |
| the mistakes they made in awarding an ineligible | | | | know-how). |
| foreign vendor with $400 million in U.S. Taxpayer | | | | Based upon the foregoing, a 25% price |
| treasure. | | | | consideration should be given to any American |
| Well, the DLA took corrective action alright. They | | | | company which offers a product or service to |
| allowed the foreign company to fix their ineligible | | | | the U.S. Government in the presence of foreign |
| offer, then rewarded them yet again. | | | | competition. And unlike most measures in |
| IDT is based in the President's home State of | | | | Washington, this highly effective strategy could be |
| Illinois. Our town of Belvidere (and the greater | | | | implemented in short order due to its simplicity |
| Rockford area), has an unenviable unemployment | | | | and popularity with the American People. |
| rate of 22% (and rising). A successful award of | | | | |