PPB January 2018
important now? Because global value chains are under attack. To promote more Made in America purchases and more U.S. manufacturing, the White House and some in Congress have taken rhetorical aim at the policies that enable these global value chains to thrive. For example, last year many of us were engaged in a fight to defeat the Border Adjustment Tax (BAT) because we rely on global value chains that included offshore partners. To some extent, this is nothing new. Although the current administration has greatly increased the focus on trade deficits as a lens through which it sees trade policy, past administrations have long emphasized exports to the disadvantage of imports to craft trade policies. Such perspectives explicitly ignore the immense contributions made to the U.S. economy by U.S. companies (and their workers) that rely upon imports. Further, traditional trade data measures do not fully capture various elements of U.S. value-added inputs, research and development, intellectual property, and other value within an exported or imported product. Failure to account for these dynamics when constructing a successful trade policy is like trying to win a boxing match with one arm tied behind your back. Ironically, it is the increasing challenge to these policies that has given many in the business community the voice to speak out. A new group of forward-looking companies and associations—the U.S. Global Value Chain Coalition (USGVC)— has recently been formed to tell the story about how U.S. global value chains equate to good U.S. jobs. Including trade associations like PPAI and AAFA, the USGVC will educate policymakers and the public about the role that global value chains play in supporting local economies. In October, the USGVC released its first report. The study, [find it at https://bitly.im/Z4soE] by noted economist Dr. SusanHester of Moongate Associates, quantifies the U.S. contribution to apparel global value chains. By taking proprietary data from several major U.S. brands and retailers, Hester estimates that the U.S. value added in any given article of imported apparel averages about 75 percent of the retail value of the final garment. Dr. Hester notes that the U.S. jobs that comprise this 75 percent value share are a combination of blue and white- collar jobs and, judging from Join e Work Of e USGVC In September, PPAI joined the U.S. Global Value Chain Coalition as one of its founding members. The coalition has been formed to tell the story of the U.S. global value chain by educating policymakers and the public about the role that global value chains play in supporting local economies. Partners include the American Apparel & Footwear Association, and many other associations and companies. The coalition was established, in part, in response to the proposed Border Adjustment Tax, which, fortunately, was defeated in 2017. The proposal would have af xed a 20-percent tax on all imported goods and jeopardized the welfare of industries that rely on imported goods. Too often, because products are manufactured overseas, some lawmakers diminish the value of such products to the U.S. economy. The coalition will compile the data to make the case for the value of the global supply chain. In October, the coalition released its rst report in which it quanti ed the U.S. contribution of apparel global value chains—among the ndings is that the U.S. value-add in any given imported apparel article averages about 75 percent of the retail value of the nal garment. These global supply chains support the U.S. economy and provide stable, well-paid jobs for U.S. workers. Membership in the coalition is open to industry companies. By joining the coalition, companies will have the opportunity to contribute data to build the next economic study and nancially support the work of the coalition. For information, contact Anne Stone, PPAI director of public affairs, AnneS@ppai.org , 972-258-3041. For promotional products, as for muchof our economy, global value chains stretch throughout theUnited States and around the world. They start with your own coworkers and employees. Look around at the many people in your company whomake your business run. | JANUARY 2018 | 75 THINK
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