June 26 (Bloomberg) -- At boot camp, U.S. Army recruits receive four sets of camouflage fatigues, 100 percent American-made. For women, the clothing package from Uncle Sam is missing one layer: undies. Neither gender gets sneakers.
A 1941 law directs the Pentagon to choose made-in-the-U.S.A. products when buying clothing for soldiers. Still, recruits receive cash allowances to buy items such as sneakers and women’s underwear, even if they come from China.
New Balance Athletic Shoe Inc., the last major manufacturer to produce athletic footwear in the U.S., may gain by forcing the government to live up to its own rules. The House of Representatives voted this month to require the Pentagon to give recruits American-made athletic shoes, after more than three years of lobbying by New Balance.
“It’s the law and it should be complied with, not circumvented,” said U.S. Representative Mike Michaud, a Maine Democrat who co-sponsored the measure and has New Balance factories in his state. “Purchases made by the U.S. government should benefit our domestic economy.”
Athletic shoes and women’s underwear are two examples of how the government has skirted requirements to spend taxpayer money on American-made goods. The so-called Berry Amendment, a World War II-era rule that directs the Defense Department to favor American-made food and textile products, has been eroded by trends in manufacturing that have sent many plants overseas.
“We’re saying the law is pretty clear, so follow the law,” Matt LeBretton, vice president of public affairs for Boston-based New Balance, said in a phone interview. “There is a pride piece here, too. Our soldiers should be wearing goods that were made in the U.S.”
Panties to Pumps
The military’s efforts to expand personal choice for recruits on items such as sneakers, women’s panties, bras, purses and pumps may also conflict with the law’s intent.
Those options may be appreciated, especially by women who don’t want an Army or Air Force acquisition officer choosing their undergarments.
“I think women are probably more particular about their underwear than men,” said Lory Manning, a retired Navy captain who served for 25 years and is now director of the Women in the Military Project at the Women’s Research and Education Institute in Washington. “Particularly with something like a bra, I am sure women want to get something that fits right.”
Maureen Schumann, a Pentagon spokeswoman, declined to comment on how much the military spends on cash allowances for recruits. She referred the question to individual service units.
The Air Force spends about $3.9 million on vouchers a year, said Lieutenant Colonel Laurel Tingley, a spokeswoman for the service. Its roughly 30,000 recruits get $75 each year for sneakers that can be redeemed for the product of their choice at military-exchange stores. Female recruits get about $275 more in vouchers for pumps, underwear, stockings and purses when they enter basic training, she said.
The Army provides similar cash allowances, according to data from Wayne Hall, an Army spokesman. It decided to issue cash allowances for recruits’ running shoes and women’s underwear because of the wide range of sizes and needs, Hall said.
The Army would have to maintain an “astronomical supply” of women’s underwear in order to properly fit “the wide range of females” who enter the service, Hall said.
“I’ve done that sort of shopping with my wife, and it’s not easy to do,” Hall said.
Fit aside, the Defense Department should seek the best value for everything it buys, as long as it’s not of strategic importance, said Stephen Bronars, a senior economist at Welch Consulting in Washington.
That is especially important as the Pentagon absorbs automatic budget cuts, he said. Defense officials must cut $37 billion in spending through Sept. 30 under a process known as sequestration.
“The bottom line is cost has got to be the No. 1 concern,” Bronars said in a phone interview.
For sneakers alone, closely held New Balance has estimated the military issues about $15 million in vouchers annually, assuming there are 225,000 to 250,000 recruits a year.
If recruits are required to wear American-made sneakers, the vouchers could no longer be used for shoes made overseas by Beaverton, Oregon-based Nike Inc. and other companies.
Nike products are made at 777 plants in 43 nations, Greg Rossiter, a spokesman for the company, said in a phone interview. The shoemaker doesn’t sell any 100-percent American-made footwear, he said. He declined to comment on the House legislation.
New Balance was founded in 1906 by William Riley, who was inspired by the structure of a chicken foot to improve arch support for laborers, according to its website. Jim Davis, the company’s chairman, bought the company in 1972. Revenue was $2.4 billion last year, said New Balance’s LeBretton.
The company has more people making footwear in the U.S. than ever, he said. Even so, it has also expanded overseas production as demand has increased.
About a quarter of New Balance’s shoes sold in North America come from U.S. factories, LeBretton said. The remainder are made in countries including the U.K., China, Indonesia and Vietnam.
New Balance teamed up with other shoemakers, such as Rockford, Michigan-based Wolverine World Wide Inc., that could also produce 100-percent American-made shoes, to lobby Congress over the military footwear measure.
The requirement was included in an amendment to the defense spending bill, which passed June 14. It was sponsored by Michaud and Representative Niki Tsongas, a Massachusetts Democrat. The measure will have to clear the Senate and win President Barack Obama’s approval before it becomes law.
Some senators already have pressed the sneaker issue. At least 15 senators, including Susan Collins, a Maine Republican, and Sherrod Brown, an Ohio Democrat, wrote to Obama in April to urge him to direct the Defense Department to purchase American-made athletic shoes for entry-level recruits.
“American workers can meet the footwear requirements of nearly all our service members if you simply give them this opportunity,” they said in the April letter.
So far, no one has taken a similar stand for women’s undies.
American Apparel Inc., the Los Angeles-based manufacturer of retail clothing, produces U.S.-made underwear for both men and women, said Ryan Holiday, a company spokesman. While it makes uniform pieces for fire departments, police and other groups, the company hasn’t lobbied Congress to change the Pentagon’s underwear policy, he said.
“If the government -- or any group -- is interested in great, dependable and sweatshop-free basics made here in the U.S., we’d be excited to have their business,” Holiday said in an e-mail.
Angela King, a 27-year-old Navy veteran, said she brought her own “granny panties,” or high-waisted cotton underwear, to boot camp in 2004. She supports efforts to require other recruits to wear American-made sneakers and underwear, saying boot camp isn’t about personal choice.
“You had to wear high-waisted white cotton underwear,” said King, who next month starts graduate school at Duke University in Durham, North Carolina. “Those weren’t things that I would put my voucher towards anyhow because I wouldn’t wear them later.”
-- Editors: Stephanie Stoughton, Steve Geimann
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