Blumenauer Opening Statement at Trade Subcommittee Hearing on Trade, Manufacturing, and Critical Supply Chains: Lessons from COVID-19
Jul 23, 2020
(As prepared for delivery)
Good afternoon. Today the Trade Subcommittee is holding a hearing on Trade, Manufacturing, and Critical Supply Chains: Lessons from COVID-19.
This is first committee activity that I’ve been involved with since we lost Rep. John Lewis, who really set the standard on so many different levels. He was a conscious of the Committee, was someone who touched us all, and showed not just courage and stamina, but humility that is rare in our environment. He was truly a unique human being and will be sorely missed. But he will continue on in our memories with all the great times and experiences that we’ve shared with him.
As John Lewis would have wanted, we must continue the people’s work, and I hope all our work will be guided by his principles and his valiant example.
Today marks the first virtual hearing for the Trade Subcommittee. The hearing topic is one of utmost importance to our ability to emerge from the ongoing COVID-19 pandemic with a stronger, more resilient economy: re-examining the trade and manufacturing policies that have led to fragile, brittle, and opaque global supply chains and applying the painful lessons we are learning from COVID-19 to make sure that we are better prepared for inevitable future crises and challenges.
The COVID-19 pandemic highlights the impact of globalized supply chains designed to pursue the lowest price whatever the true costs without appropriately accounting for the possible risks, such as unanticipated disruptions to sourcing, relying on complicated and multi-tiered supply networks, and losing key manufacturing flexibilities in the United States. We fail to appreciate our vulnerabilities.
The pandemic has revealed the almost total extreme lack of transparency into supply chains while exposing the dark underbelly of what were once considered innovative, cost-saving business models. The dependence on limited inventory and just-in-time delivery enhances our vulnerability.
COVID-19 has served as a very painful example of a long-existing problem.
In the spring, I was horrified to see medical facilities across our country, including hospitals and nursing homes, struggle to secure personal protective equipment and lifesaving medical devices, like ventilators. We witnessed state governments were forced to turn to unreliable suppliers charging exorbitant prices, to obtain desperately needed medical products.
While I had hoped that this dark period was behind us, in the past few weeks, we are seeing shortages again emerge as cases spike in various parts of the country.
Despite the tools at its disposal – such as the Defense Production Act – this Administration has been unwilling to use the full power of the federal government to develop U.S. production capacity to meet the ballooning demand for these critical products.
For the richest country in the world, this seems like an absurd – and sad – reality.
COVID-19 underscored the decline in American manufacturing, which presents major economic, national security, and public health challenges that can no longer be ignored.
We must think strategically about our domestic manufacturing capacity, both in the context of the COVID crisis and what comes next. These considerations must be understood in the ongoing and emerging economic, security, and technological competition with China.
China has not been shy about its intent to use industrial policies that deploy the full might of the Chinese economy in furtherance of its strategic and geopolitical goals. The United States cannot sit idly by as China invests heavily in these ambitions.
As Members of Congress, it is incumbent upon us to seek out experts, like our witnesses today, to identify issues, and to learn from past mistakes. Policymakers must think about how the United States can mitigate risks while cultivating dynamic and innovative manufacturing capabilities and economic opportunities for our workers and our families.
As part of the effort to first understand and ultimately address the deficiencies in our existing policies, I am pleased that we were able to convene this panel of experts who can provide a diverse range of views and perspectives as we consider policies that ensure greater resiliency in critical supply chains.
We must keep an open mind about the policy levers that are appropriate moving forward. I encourage my colleagues on the Subcommittee to use today’s hearing as an opportunity to actively examine available policy tools for addressing one of the most consequential challenges of our time.
In the conversations that have been developing around the topic of re-examining supply chains and the relationship between trade and manufacturing at home, there has been a lot of excitement regarding tax incentives, Buy American policies, or applying additional tariffs.
In our examination, let us not fixate on one particular tool to the exclusion of others. Let us keep open minds and keep our eyes strategically focused on our objectives.
Meaningful solutions will require us to work together, to be thoughtful, strategic, and creative. They will require our best tools and ideas to work in concert, likely across different policy areas. Without pre-judging what those specific tools may be, I am confident that trade policy is an important part of the answer.
Today’s hearing is intended to assist our Committee in a robust, productive, and bipartisan effort to harness trade and manufacturing policies to create resilient and versatile supply chains. The future of the American economy, the health of our workforce, and our leadership in innovation is at stake.