Tag: global value chain

New Morning Brew Video: The Complex Reality Behind “Made in the USA” Clothing

Picture above: Macy Gilliam of Morning Brew visited the University of Delaware to interview Emilie Delaye, a graduate instructor in Fashion and Apparel Studies, and Sheng Lu for the episode.

Discussion questions

#1: The video argues that “Made in the USA” does not guarantee ethical production. What does this reveal about the limitations of labels and marketing claims in helping consumers make responsible purchasing decisions? If producing clothing in the U.S. can still involve low wages, poor working conditions, or imported materials, what does “responsible sourcing” or even “Made in the USA” really mean? Is where a product is made more important than how it is made? Why?

#2: The video presents a tension between maintaining a domestic apparel industry and recognizing that U.S. fashion companies create substantial value through design, branding, merchandising, and marketing even when manufacturing occurs overseas. Should the U.S. prioritize bringing apparel manufacturing back, or should it focus on maintaining competitiveness in other parts of the value chain?

#3: As future fashion professionals, what does it mean to “do the right thing” when there is no perfect sourcing option? How important is personal character in making responsible sourcing decisions?

New CRS Report: U.S. Trade with Free Trade Agreement (FTA) Partners

3Key findings:

  • Between 1985 and 2011, the United States entered into 14 free trade agreements (FTAs) with 20 countries. Data from the Census shows that U.S. merchandise trade (or trade in goods) with FTA partner countries represents nearly 70% of all U.S. exports in goods and services, and more than 80% of all U.S. imports of goods and services.
  • In 2016, the United States ran a merchandise trade deficit of -$71.3 billion with the 20 FTA partner countries and a services surplus of $68.9 billion. The share of the U.S. trade deficit with FTA partners, however, has fallen by nearly half over the 2007-2017 period, from 18% to only about 10% of the total -$734.4 billion U.S. merchandise trade deficit.
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  • Regarding the economic impact of FTAs on the United States, a study conducted by the U.S. International Trade Commission suggests that bilateral and regional trade agreements increased U.S. aggregate trade by about 3%, but less than 1% for U.S. employment (or 159,300 full-time equivalent employees). Specifically, the study finds that rising imports, due in part to the Agreement on Textiles and Clothing (ATC), accounted for most of the reduction in U.S. employment in the apparel industry between 1998 and 2014.
  • Current trade data treat exports and imports as though the full value of an export was produced domestically and the full value of an import was produced abroad. However, the rapid growth of global value chains and intra-industry trade (importing and exporting goods in the same industry) has significantly increased the amount of trade in intermediate goods in ways that can blur the distinction between domestic and foreign firms and goods. For example, foreign value added accounts for about 11% of the content of U.S. exports in 2010. As a result of the growth in value chains, traditional methods of measuring trade may obscure the actual sources of goods and services and the allocation of resources that are used in producing those goods and services.
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  • Trade agreements of the type currently being negotiated by the United States comprise a broad range of issues that could have significant economic effects on trade and commercial relations over the long run between the negotiating parties, particularly for developing and emerging economies. However, the negative effects of international trade and trade agreements, particularly potential job losses and lower wages, often are distributed disproportionately with the effects falling more heavily on some workers and on some firms.

The full report can be downloaded from HERE