Speaker 1 (00:09.036)
Hello and welcome to the Management Under Construction podcast. I'm Dee Davis.
And I'm Brad Wyatt, and we are here today to talk about what does Made in the USA mean to you? I came at this from an experience of doing a little bit of research on the topic for the sake of the podcast on US Steel and its history, since that's been the news recently. And also from having worked a little bit in procurement of Made in the USA requirements for a federally funded project. But other than that, I think Dee has more expertise on this subject than I do by a lot.
Well, most of my experience has to do with procurement in the construction industry and just watching it change over time. What does made in the USA mean to you, Brad?
That was a big thing when I was a little kid. remember the distinction between something being made in the USA, meaning, it's better quality or, it's overpriced, depending on who you talked to. And when we think about what made in the USA has meant in this country over its history, that's the real meaning it's had for me, just studying it to understand what pride in American manufacturing meant versus what globalization and what trade have meant. When you look at products, especially some of the more expensive stuff,
it'll say designed in California, like Apple's stuff, for example, which is a way of trying to still resonate with that audience who wants something that has at least American pretenses of origin. In terms of trying to put the toothpaste back in the tube of bringing things back to the United States for manufacturing that have gone away, they're cheap, one-off things. I'm not going to make a distinction between hardware like a door hinge that was made in the United States versus one that was made in some other country.
Speaker 2 (01:57.228)
The bigger stuff, I think it matters more. There's a lot of new ones to get into, but I'm just excited to hear your thoughts on the history of it. You've been in this longer than I have to have more perspective on it.
For me, Made in the USA is mostly about the fabrication and assembly using American labor, USA labor, I guess I should say. And we're going to talk about that distinction between United States and America, which what does it really mean? In the past, it meant that the item was crafted and assembled in the United States. Now the Federal Trade Commission defines it as all.
Or virtually all. These are the real words. All or virtually all of the components are made in the USA. Legally ambiguous language. What is virtually mean the difference between made in USA and made in America made in America can actually mean that it's made in Mexico or Canada. I remember when I found out that that was.
thing and we're going to talk about NAFTA and we're going to talk about the World Trade Organization briefly. We're not going to get into politics here folks, I promise. Just understanding how did we start off with one place and end up in this other place?
Do you want to start off talking about US Steel?
Speaker 2 (03:29.592)
Yeah, so I was reading recently about the deal that Nippon Steel, which is a Japanese company, wanted to make to buy US Steel. And I had remembered reading about US Steel in middle school, high school history. But how could we have come to a place where what was once one of the most profitable, one of the largest companies in the United States has become so defunct that it's now under talks to be bought by Nippon Steel? We're not gonna talk about
whether that deal should have been blocked or not, that's politics. But I did a little research, I read an article about the long, strange history of US Steel. And the innovation that that company was able to bring to bear in the early 20th century, the profitability of that country, it was one of the biggest employers in the whole Northeast. It was how Andrew Carnegie made a lot of his money. It was how Charles Schwab made a lot of their money.
the company that still exists and manages a lot of Americans finances as a bank today. But as people were able to make steel for cheaper in other parts of the United States after World War II, the innovation slowed down. The corporate raider era came into being where everyone was trying to grow share price for their company and doing whatever they could to do that. Offshoring being a big part of that.
and concerns and negotiate became very endemic to American manufacturing. At one point in the 70s, American laborers were not able to come to an agreement with US Steel over what was going to be a fair price for the labor and what the benefits were going to be. And that result of a no deal really hampered the company to be able to continue as a profitable entity. And people cite that as a landmark example of
globalization and of American manufacturing declining of the start of the real fall off of things being made in this country because international shipping was getting a lot cheaper at the time and it was becoming more and more expensive to pay somebody a living wage in the United States. was all of sudden possible to manufacture steel in other countries where it hadn't been before. A lot of economies were coming back to their full levels of productivity after World War II and
Speaker 2 (05:52.142)
It happened that that workforce went away and found other things up skilled, a lot of steel counties in Pennsylvania. The jobs just went away and people left. And what was once a booming economy was a ghost town all of a sudden. So globalization has certainly had its impacts in everyone's lives, most acutely in the lives of the people who used to hold those U.S. steel jobs. But just a cool glimpse into history of how we got here, I thought.
I was in Pittsburgh recently and it's a very different place than it used to be. It's one of the main hubs of steel manufacturing in the United States, or it was anyway. So let's talk about how did we get here? How did we go from a local economy? We were making most of these things ourselves in the United States to a global economy. NAFTA, North American Free Trade Agreement, became effective in 1994, blurring the boundaries between the U.S.
Mexico and Canada. I remember precisely when it happened when I looked up the history of it to make sure I got my facts straight. It took three presidencies to get this done folks. The president that signed it into law. Had nothing to do with getting it started. It took three entire presidencies to get this done. These things don't happen quickly. Now to change the tariffs between the countries. Curly with Mexico and.
It increased tariffs in some ways and removed a lot of tariffs. Which in our current political climate, again, not going to get into that. Some of that stuff might be shifting back. by 2016, Canada and Mexico accounted for 34 % of exports and 26 % of imports for the United States. NAFTA affected domestic labor substantially. So in addition to
some of these companies, like you were saying, ocean transportation, getting deeper and all these other things happening, then NAFTA happens and people start thinking global economy a little bit more. We're expanding our world a little bit here. Back when NAFTA happened, I was working in the construction industry and I can tell you that there were still made in the USA clauses in a lot of my specifications that I was working in. We had to buy.
Speaker 1 (08:16.014)
American made steel, American made piping. There were clauses in the specifications that you had no choice but to do that. So we're starting to see this blurred a little bit now in the 1990s. So what- Yeah, of course.
you go on. So I think that's really interesting. Do you think that those clauses were in those contracts to do with a concern over quality, a concern over price, a concern over politics? Why do think people were writing those contract specs that way at that time?
think some of it had to do with we were starting to see things be available offshore, you know, from offshore providers. And I remember a very specific instance where I was working on a project that had made in USA clauses in the specification and I was an installing contractor at the time and I was asked by my company, hey, can you ask them if we can.
waive the made in the USA clause because I can get this other pipe so much cheaper from whatever country, right? I went and approached my client about it and I remember their response was, I don't want any of that commie pipe.
All right, so a little bit of, yeah, some politics there for sure.
Speaker 1 (09:37.986)
I think there was some politics. It was a different time. mean, it wasn't that long ago, but it was a different time where there was this feeling of like, we need to preserve American jobs and we need to make sure that we are getting things locally. You start losing control when things are coming from overseas. There's, we'll talk more about that later in the podcast. There's lots of things that happen and change when you start pulling things from around the world.
So it's probably a little bit of all those things you said.
This is a small anecdote, but you look at Italian product quality back in the 50s and 60s after they're coming back from World War II, they were buying a lot of their steel from Russia. And it was so poor in quality that it was rusting by the time it reached their factories. And they're like, well, can't do anything about that. Don't have any leverage to go tell the Russians to send us better quality steel. They're not going to do it. Let's just build the cars anyway, which is one of the reasons that a lot of Italian cars got a bad rap here, I think, they were all.
Interesting.
They were they only had a certain supply for steel. But anyway, I just wanted to clarify that. think that's really.
Speaker 1 (10:51.906)
Yeah, post-war economies are a whole different conversation because there's limited options and limited availability of materials and everything else. So when NAFTA happened, HVAC manufacturers started moving their factories to Canada and Mexico. And I got to tell you that I started seeing the quality
dropped substantially. So the same manufacturer that I'd bought from before, I'd bought these air handlers, they were made in the United States. They moved their factory just over the border into Mexico. And I mean, just like you could throw a rock and hit the border. And all of a sudden we started having quality problems with these air handlers. And I've had the same issue with
stuff that moved to Canada, which is surprising. I wouldn't have expected that as much. The labor, I don't know that it's any cheaper in Canada. I'm not really sure why. There's probably reasons I don't understand why they would move some manufacturing to Canada, but I had air handlers delivered from a factory that was in Canada that looked like they had been drugged down the freeway the entire way. I had to reject them. I mean, that was one of the worst equipment receipts I've ever had.
The stuff from Mexico, it just kept getting worse and worse. bought these air handlers and had some problems. Well, then years later I bought some more and they were a train wreck. mean, they came partially assembled. The paint was still wet. They were falling apart. It was loose parts jiggling around inside the air handlers. For three months, I had staff on the roof of this building finishing the assembly.
finishing fixing everything that was wrong with them. It was a disaster. So not a fan.
Speaker 2 (12:57.644)
What year was that, if you recall?
Speaker 1 (13:05.102)
2006 maybe somewhere in there.
more recent than I thought you were going to say. That's disappointing. And this is a tale as old time in terms of squeezing the value out of something that once held a high regard in terms of the market opinion of quality. When you get stagnation in any kind of creative innovation, all of sudden it becomes a race to the bottom. And these managers at the top of these companies are like, well, how can we save money? Because we can't figure out how to make people pay more for our products. So we've got to
grow the company by decreasing costs. And I'm sure that shipping it over to Mexico in terms of manufacturing and to Canada and reducing the quality checks was a big part of that. So that's disappointing, but not altogether unique as far as the story of things that happened at that time.
And you wonder about the training, the language in the case of Mexico, potentially language barriers. I really don't know the answer to what caused the massive decrease in quality. I can only say that there was a massive decrease in quality as somebody who buys a lot of equipment. I don't want that air handler on my project anymore. Right. Ever again, I don't trust them.
It's unfortunate. then, you know, so you have this reduction in quality and then depending on where you're ordering from, now you're going to have an increase in transit costs. You have international borders that you're crossing. You have a higher carbon footprint for that transportation and less control. I mean, tell me if you've ever been out there buying equipment for a project, have you ever had your driver?
Speaker 1 (14:54.412)
disappeared for three days in Vegas? Cause I have. It's, know, the driver's supposed to be there on Tuesday and you've got cranes set up and all this stuff and your driver disappears for three days. Of course that's, that's domestic. So if you got to go anywhere in your Vegas, that could always happen. I've had crazy delivery stories over the years, but the further you're coming from, the more likely you're going to encounter weather problems, other transportation problems. And if you're crossing international borders, they're.
that increases the likelihood that you're gonna have some kind of problem.
And variability in a construction schedule that doesn't need to be there is just a killer. I mean, I we were procuring these gorgeous tiles from Vietnam that were cement and they were exactly what the architect wanted. And there was nothing like that we could get anywhere else. So we were able to find them, but everyone was just like, oh, they're built where? What do you mean they have to support LA for 12 weeks to clear customs? We got a floor to build. What are you talking about? I mean, that was a real shock to the team that variability sucks.
Yes, and we'll talk more about some of that. I've got some stories for you later on where we're going to talk about all kinds of different things related to overseas purchase. And to complicate things, NAFTA was signed in 1994. 1995, the World Trade Organization was founded. Their job is to make international trade more seamless. This is the whole concept of globalization. We're a big global market.
We're going to open all these things. We're going to allow international labor to be used for manufacturing to bring labor costs down. We're going to make everything cheaper. It's going to be great. China joined the World Trade Organization in 2001. This was a landmark event when it comes to things being made in the USA. So yes, there was lots of things that happened shortly after the World Trade Organization was started. But when China entered the market,
Speaker 1 (16:55.662)
In 2001, it was, it was kind of over at that point. I'm going to recommend a book, uh, called poorly made in China. I'm rereading it. It's such a good book. It is actually tells you all about thing that you never wanted to know about what goes on in China and Chinese manufacturing and why it's, it's a real problem. But between 2001 and 2004, so three years, three years.
Chinese manufacturing increased four times. Four X in three years. That is massive. That is massive, rapid growth. Impacted American manufacturing, especially automotive. The automotive industry got hit very, very hard. Structural steel and piping and everything in between.
So we're starting to lead up to a dip in quality that we started seeing and quality problems we started experiencing in the construction industry in the early 2000s. Between NAFTA and the World Trade Organization, there was all this confusion about now what is made in America, what is made in USA.
There's also, like you mentioned earlier, a lot of other labels out there, including assembled in this country made from X countries parts made in America with imported parts. There's, there's a hundred labels out there. We have all these qualified statements around America, USA, all of that label confusion. In terms that have either no legal meaning at all, or very blurry definitions and vague definitions.
And by the way, we see this in lots of industries. It's not just in manufacturing, say, or in the construction industry. We see it in food labeling, just for fun, just because this applies to all of us. I'm going to give you some of the food labels that have no legal meaning. And I don't think most people, unless they've spent the time researching this, probably even know this. All natural.
Speaker 1 (19:07.04)
local or locally grown.
No meaning,
No meaning, no legal meaning, lightly sweetened. Made with whole grains.
So when you're out shopping and you're looking at these, it's marketing deception. We start twisting the words and putting these words together in a way that leads the consumer to believe certain things that are not in fact true. And there's nothing we can legally do about it until we legally define something.
In the sustainability market, see the same thing. Sustainability, see marketing deception with sustainable, has no actual legal meaning, green, environmentally friendly. None of those things actually mean anything. And so I can put that on my product, make those claims to make you want to buy it and think you're doing the right thing when in fact, you may not be doing it at all.
Speaker 2 (20:04.462)
And I have tell you, I would never have imagined that the term all natural doesn't have a legal definition. The term sustainable, the term green, the term environmentally friendly, I would have believed, okay, yeah, if I read that on a product label, I'd like, well, how can they really claim that? All natural, if that has no legal definition in a court and somebody can say that, you know, a packet of life cereal is all natural, but really it's like total artificial crap or whatever. I couldn't think of something that was an artificial.
Yeah, there is that particular term they've looked at trying to define it and there have been some loose squishy definitions that have been tossed out there before.
The problem is when you use an ambiguous term as a definition, you're not really defining anything. So when we say all or virtually all, as in the terms that we're defining for made in the USA, what does virtually mean?
1%, 5%, 30 %? You have to go to a court of law to find out.
Speaker 2 (21:14.71)
And last place any of us want to be is in a courtroom faced with the jury of our peers.
Right, so the legal definition of made in the USA currently contains this ambiguous language like all or virtually all. And it includes all 50 states and US territories like Guam and Puerto Rico. So I forget about this country's I'm sorry I somebody lives in the lower 48 the contiguous United States. I do forget about the territories from time to time.
Sorry guys, it's nothing personal. In fact, I'm sure they would prefer that we just leave them alone. Let them do their own thing.
in Puerto Rico. That's a whole different topic from today. But the fact that made in the USA includes those terms is somewhat more than somewhat misleading is what I would say.
Well, it doesn't match what my preconceived notion would be for Made in the USA. So I was doing some reading and some research and preparation for this podcast and I found a really good little story. Here's how can get these Made in the USA tag put on things that are squishy. So I thought this was a good story. So I'm going to share it with you here. This is from the website, allamericanmade.com. They're a company.
Speaker 1 (22:34.496)
that claims, and as far as I know it's true, but do your research, don't assume anything, claims to have all American-made products on their website. The example that they post is, say that you're going to buy a gas oven that says Made in the USA. Let's say the majority of the and the components are made and manufactured in Des Moines, Iowa.
But the knobs and the tubing that supplies the gas to the burners are made in China and shipped to the factory in Iowa where they're installed on the final product. Since these parts add up to a, air quotes, negligible amount of foreign parts, the manufacturer can stick a Made in the USA tag on the oven without any legal ramifications. It went on to say that, well, when you start getting...
adding, we did this and the burners and all these other things. When you start getting to around the 30 % mark, it starts being a little legally shinnable. But then somebody's got to take the time to prove it and bust them for it or sue them for it. And who's going to do that?
Yeah, that's the thing. think it's interesting to see the shift that we're seeing now. When I was working on a project in California, they had this very, very stringent set of requirements called living building challenge. And they had a red list of all the different chemicals they didn't want going in the building. And I remember being this like 22 year old project engineer, given a list, hey, you got to prove that all the chemicals that we bought for the job don't have these in them. I'm like, okay, how do do that?
call the manufacturers and ask them for build sheets. Okay, so I've got a list of a thousand cocks and like other sealants and stuff to go through. And these people are like, who are you? Why are you calling me? How much of my product did you buy? You bought five tubes of it and you want me to do an hour's worth of research to figure out with our chemists, whether this had it in it or not. It's an admirable thing to try to achieve an environmental goal the way they're achieving it in environment being the indoor environment they're creating.
Speaker 2 (24:39.128)
for the sake of the health of these, it was at the time students was going to be at school building. The owners that's being imposed on them is a very high bar of what they have to do to prove these different metrics, whether it be made in the USA or other metrics. think trying to come up with these new labels that people were advocating for that makes sustainability claims that track how much carbon emissions were associated with the manufacturer of that product. There's a lot of accounting. There's a lot of work that has to be done that's going to increase the cost of anything.
because somebody's gonna have to be paid to sit there and do that.
Yeah, absolutely. You bring up an interesting point with, have all these different green building systems, living building challenge. We have LEED, there's a number of other smaller or local ones that yes, they require all kinds of documentation. Is anybody asking for the documentation about where the components come from? Even when we had made in the USA clauses in the specification, I don't remember getting any documentation.
I don't remember getting a manufacturer statement. Now it might say it on their cut sheet made in the USA. Well, that was good enough. But then again, it meant something different back.
you
Speaker 1 (25:50.434)
I can say for myself personally, I'm always going to be an advocate of made in the USA versus made in America or any kind of overseas manufacturing. I mentioned earlier that I had air handlers that were made in Mexico. And again, same manufacturer made them in the United States and then moved their manufacturing down into Mexico after NAFTA. And those
Air handlers gradually decreased in quality over time to the point where I would tell any owner to avoid that particular manufacturer at this point in time. In the end, the owner get something great out of it? They absolutely did. And I made the manufacturer send people up and work on those things in the field for months. But the to detail.
incredibly low quality and rework that had to be done in the field just to make these things acceptable to be used. These were going in a hospital. It was a big deal. You can't just throw together a piece of junk air handler and put it in a hospital. It's not going to perform. And one of the air handlers had humidifiers and desiccant dehumidifier that had all these extra components that can be.
Kind of problematic on their own sometimes and to have them come partially put together and a train rack was not good. And then the other air handlers from Canada, I don't remember where in Canada they came from. They came all the way down to California. It was a project in Southern California. So they came all the way across the United States, one way or the other. They came through weather, which not in California, but
They had to come through Canadian weather and Northern United States weather in the winter time. And they were not wrapped properly. They just weren't protected properly. Those are the kinds of problems we have when we have things that are from the Americas. Imagine that when we're having it coming from overseas. When I do a lot of pharmaceutical projects, we have stuff coming from Germany. We have stuff coming from all over.
Speaker 1 (28:13.976)
The world, there's some specialty pieces of equipment we have to order from overseas. There is no option. Valves and large vessels and things like that. Well, these things have to make it across the world on a ship and then they have to go through customs and then you have to hire an expediter to get you through customs. That's an additional cost. You don't have to, but you could be sitting in the port for weeks and weeks and weeks, like you said, if you don't have an expediter.
and they fill out all the customs paperwork for you. If you don't get that right, the first time I had to fill out customs paperwork myself, I was like, oh my God, you gotta be kidding me. It's insane. And then there's strikes at the dock that happen.
more variability.
Stuff gets lost, sink. That happens too. I've also had issues with piping manufactured in certain countries. The quality is low. If you get the chance to read Poorly Made in China, I highly recommend it. The author of the book is Paul Midler. He is an American who speaks fluent Mandarin from...
international business school and lives in China. He's the go-between for a lot of these companies. And he tells stories about the crazy stuff that goes on and the false productions that are put on by manufacturers in China that want American business. And the, I'm just going to call them unscrupulous tactics that are used. mean, just, just read chapter one, your mind will be blown. Piping.
Speaker 1 (29:55.586)
wall thicknesses are not right. The ovality is not right. The finish is not correct. I've had cast iron piping with holes in it. I've had it show up to the job site rusty. It's, it's not good. You're not in control. If you have a long lead time item that you're waiting for, and it shows up to your job site in less than seller condition, what do you do now?
You can't order more because you gotta wait seven, eight, 12 weeks, whatever it is.
Or longer, right? Who knows how long you might have had to wait many, many, many months for these things to come. So it really puts you in a bind as a contractor to buy these things from overseas and then have them not show up, not show up on time or not show up in pristine condition. Longer lead time certainly, certainly are taking away US jobs and the environmental impacts of the imported goods.
The book, Poorly Made in China, he talks about how it's so cheap. It's cheap to the point of they'll throw container loads away that don't meet spec because it's cheaper to throw the containers of material away and order more. The Chinese government is not going to support you in your efforts to force better quality.
And there was, there's actually a case of some structural steel that was manufactured overseas that was made not to spec. was the, one of the little tricks that they use is they'll make it for to spec at the beginning. And then they start reducing quality over time to make more money. It was a structural steel that was not made to spec and it caused a collapse and some fatalities. So I urge you as a contractor.
Speaker 1 (31:50.548)
If you have any kind of options, be very, very careful about where you're buying your materials. We certainly have lost our self-sufficiency in the United States for manufacturing because of this globalization. I was one of those people that was excited during COVID. I was like, this is it. We're going to learn our lesson.
So bad. At what point in your life up until that point had supply chain been on everybody's lips as like a topic of dinner table conversation? Never, right? I mean, that was the most air time, talking time that supply chain as a topic got at that point.
was every construction site, every household, every, everything, the toilet paper shortage of 2020. mean, come on. I was actually secretly happy that we were having these kinds of issues because I thought now we're going to get it. We're going to get it. We're going to bring manufacturing back to the United States where we can be more in control of it. We're going to stop this. It's not that.
that global markets are bad, it's just that when we are so reliant on them that we no longer even have the skill sets or the factories or anything to maintain our own stuff, that's when it becomes a problem. But here's the thing, we didn't learn.
We learned nothing. Nothing changed.
Speaker 2 (33:16.866)
Well, and to put a kind of bow on that, as far as what we've been talking about, I think the best way I could summarize it as somebody trying to learn about this is at a certain point, it was possible to build a lot of things outside of this country for a 10th of the cost. And they're only half as good. But somebody with a very beginner understanding of this business would be like, well, I could stand to replace the pipes twice as often if they cost
a tenth of the amount, what really happens is the cost during construction of having shoddy materials show up to the job site in terms of the labor cost of rework, in terms of the delay costs of slowing down the progress of the construction project is far and above what it would have cost to buy them at the American standard of cost. Even though costs were inflating in this country,
there was perhaps a trade off made that people didn't understand at the time in terms of the lengthening of our supply chain, in terms of the lessening of our leverage to those suppliers, our recourse went away. Whereas back in the 40s and 50s, you could have gone to Pittsburgh Steel and say, hey, I'm suing you for selling me pipe that has holes in it because you just cost me four, six weeks of productivity on my job and it cost me this much. That kind of recourse that we once had domestically
as a supply chain that relied on domestic sources has gone away. And that's had an outsized impact on construction productivity, on stress levels, on variability of construction projects that perhaps was not understood when that trade-off was made at the time.
You bring up a very good point and this is something I like to talk to owners about a lot is the giving into the temptation of a great deal. It's hard to resist and whether you're hiring a contractor or you're talking about a substitution on a project, waiving a spec, changing a spec, know, there's this manufacturer and I teach about this when I teach my MP classes to contractors.
Speaker 1 (35:32.246)
you can go look and see all the manufacturers in the world that in fact sanitary tubing for pharmaceutical projects or microelectronics.
But that doesn't mean that you should buy from all those manufacturers because some of them have some serious quality problems. That stuff all has to make it through inspection. And if it doesn't make it through inspection, gets rejected. And I'll never forget, I had a job, a pharmaceutical job where we had to go through third party QA on every single piece of material. was a hundred percent inspection. I have a fitting that sits on that desk that reminds me of that story.
because it's such an important lesson that you can never forget. I had to reorder those elbows six times. I ordered no less than 20 elbows over six different orders to get enough elbows through inspection because the quality was so bad.
You can't afford that. A well-priced, competitive, MP-tracked project cannot afford that. Period.
Nobody can afford that. It doesn't even matter what your contract value is, what your contract type is. No, I've never been on a construction project that just has lots of extra time. The schedule, nobody has that. Contractors get paid to do it one time, not three times, four times, five times. The number one cause of scheduled delays is it not being ready. The guy before you not being ready.
Speaker 1 (37:07.98)
The schedule activity right before you not being done. We can't afford to wait. I know that construction before COVID, maybe the 10 years before COVID, we went to this just-in-time model of construction and I laugh at it now because if COVID did teach us anything is that we can't afford to do just-in-time deliveries on projects. It's too risky. Before we had the COVID.
thing, it seemed to work out, although it always made me nervous. It seemed to work out okay a lot of the time, but switch gear, you could still be looking at 24 months lead time for major electrical equipment. You could be looking at 12 months lead time for an air handler, large fans. There's still major equipment that you could be looking at a year or more of lead time. And these are things that we could get in 12 weeks before. Trying to take back control.
of that piece of your project schedule is huge.
It turns us to, you know, what can we do as construction managers to try to avoid the issues that we see with procurement of poor quality materials impacting our projects.
Well, before we get onto that, I do want to say there's one more aspect of things from around the globe. And I just have to do it because I am who I am. It's the sustainability aspect of it. The pollution of air and water that other countries, particularly third world countries, do not have the regulations that we have. So if we make it something in the United States,
Speaker 1 (38:54.872)
We have to comply with all these different regulations to protect the air and the water and minimize pollution. And we have air pollution control districts and we have water quality checks and all kinds of stuff like that. These other countries don't have that. Well, guess what? Their air is our air. And ultimately their water is our water. So not protecting the air and water is a big deal. We have the long shipping costs, not just the cost of the shipping and the time that it takes, but the carbon footprint of that shipping.
And then the waste that US importers throw away, see containers full of materials that are imported because it's cheaper than trying to hold anyone accountable or more doable than holding anyone accountable. And then there's health and safety concerns for the production workers. I mean, it really kind of ends up boiling down to human rights. The reason that you can buy something for eight cents off a T-MU is because somebody's getting paid a half a cent to make it.
We love a deal. Americans love a deal. We just can't help ourselves. But you have to think about the health and safety and human rights. These people do not have unions. They might be working 16 hours, 20 hours a day in horrible conditions to give you that cheap thing. That's not okay. And we need to consider that when we're doing it. And then of course the quality aspects that we've already hit on.
And just to offer an interesting perspective on that, think when you talk about air quality and you talk about pollution in this country, we don't have a perfect track record of that ourselves. BASF, gout chemical, there are a lot of environmental laws and regulations in this country that are written in blood, that are written in the devastation of communities as a result of horrible pollution. There's still horrible pollution that occurs in this country due to over farming and other concerns. It's that
It would be fair for somebody to argue that countries like China are going through their own similar process that we did where they are polluting because it's cheaper and people are pushing back in those countries and are saying, no, we need to hold ourselves to a higher standard. So they're cleaning up their power grid. They're jumping straight from coal to solar. They're jumping straight from coal to wind in communities. And progress is great.
Speaker 2 (41:16.288)
some of that progress has to be funded by making money the dirty way. There's a Dale's advocate argument to be made there. And I think it's interesting to consider that we once had our own issues in this country with labor and no union and people working for way less than they deserve. So to put a cap on that, as far as globalization goes, I think it's also cool to say that we hope that all workers everywhere get better quality of work, however they can and that
better environment policies be implemented wherever they can. I was talking to a Chinese student about her family's business, which is in mining, and how over the past couple of years, the Chinese government has gotten very stringent about not polluting as much as they were once allowed to. So, in the world, and that's a thing to be recognized wherever you can.
That's great to hear.
Speaker 1 (42:07.928)
Yeah. I'm glad to hear that there's some improvements. mean, I do worry a lot about worker conditions and workers' rights because, I mean, we can't forget it's a communist country. See, back when I grew up, that was a curse word. To call somebody a commie was kind of a big deal.
Commie or red was like a whole United States was fighting communism around the world back in the day. And now we have open trading with communist countries, which just blows my mind. I, I'm not entirely sure. That's a great idea. Do we want to help communist countries grow and thrive? I don't know. I guess that's politics and maybe I shouldn't. I do think about that. And I think about the workers and
No, I will never buy a thing off of any of those cheap websites for that reason. I know those people that are doing that work are suffering so that I can have something cheap and I don't feel good about that. So I can't do it.
So what can we do? What can we do as individual humans, as industry? We can insist on buying products made in the USA as much as possible. You make your choice. Made in the USA, made in America, is made in America better than made overseas? Yeah, I guess so. And at least it's coming from closer. Made in the USA, for me, would be the optimum choice. It's not as easy as it sounds because we've lost so much of that ability.
If you go to almost any store for anything and you start looking at labels made in wherever labels, good luck with that. The percentage of made in the USA stuff is very, very small in comparison to everything else. At the job site, always find out what manufacturers have their factories where. So this is a question I always ask when I'm buying out equipment. Where is it made? Where are your factories? And if the factories are in multiple places,
Speaker 1 (44:15.646)
I try to get it written into our purchase order that they can only make it in the factory that exists in the United States. That's about all I can do. As a business owner of any kind, try not to cave to the temptation of the cheap overseas labor and keep Americans employed. I have had the opportunity many, many times. have a couple of virtual assistants. They are in the United States. There are so many options to get virtual assistants way cheaper.
from overseas and I opt not to do that. I hope that some of you will too. And then be very cautious of the marketing tactics employed by all these different companies using these crazy labels or naming their companies in a certain way to imply that they're in the United States when in fact they aren't. Using American symbols like the flag or the Statue of Liberty on their products, on their logos,
anything like that or company names that contain US, USA or American. That doesn't mean that they're based in United States. They could be anywhere. You're allowed to name your company, anything you want. Avoid buying from the cheapo websites and that consumerism. It's so tempting. know. Give it a second thought and ask yourself if this is really how I want to contribute.
Instead, do your research and find companies like Strictly USA. They happen to be a Colorado company. There are companies like that. I know there's a number of them. If you start looking for stuff like that in your Google search and in your, in your Facebook feed or whatever it is that you're doing, more of that stuff will start coming up. Check it out. Just make sure that you're asking questions and checking things and make sure that you're not getting a
label that is leading you down one path when that's not really where you're trying to go.
Speaker 2 (46:16.558)
The economics work such that every one of us votes every day with the dollars we choose to spend. And if we demand the quality that makes our lives better, great. That's going to have the impact it will have on the economy. I we're recording on Sunday, February 2nd. I was reading the morning news today. It was announced that there's going to be these tariffs imposed on Canada and Mexico. Tariffs are taxes. To review the economics of what's happening there.
That's it.
Speaker 2 (46:46.35)
I think for a long time, people have been betting on consumers not doing the research that Dee is talking about doing and saying, oh, made in America. That means something that I want and continuing on their way. The way to get what you want out of it is to do the research to put in this more work, which sucks. No one likes to have to do more to get past these deceptive marketing terms. But if you do, and a lot of other people do, frankly, it'll have the intended impact. There was a...
DS2 Smart to ride motorcycles. I ride motorcycles. I watched a very interesting video by one of my favorite journalists in the subject about what happened with Trump and Harley Davidson in NAFTA and the agreements that were made. And he imposed a tariff on motorcycles made not in the United States, made abroad. And then after that, to cut costs to try to stay competitive, Harley Davidson started making their engines.
outside the United States, or least some of them, not all of them. And he was quoted on CV as saying, don't get cute with us. And I'm not sure that I would necessarily say on any forum that I agree with everything that comes out of that guy's mouth, but he's got a point there. That is, that would be a very apt way to describe Harley Davidson getting cute with the United States government, lobbying for a tariff to protect their interests and then having something built outside the United States. So there's a lot of nuance to these subjects, matter what
industry you're in, no matter what good you're talking about, do the research, understand the nuance and look into the economics. I mean, I'm not nearly smart enough to talk about the kinds of economics when you get the currency manipulation that the Chinese government engaged in to be able to sell products as cheaply as they were able to here for a long time. There's a lot of nuance to these subjects that you will be rewarded with educating yourself on. You'll become a better consumer. You'll become a more thoughtful
reader of the news and you'll be able to have a more nuanced opinion that serves you is what I would say on that subject.
Speaker 1 (48:49.226)
It's always about doing your research and voting with your dollars. And when it comes to vote voting, voting, make sure that you're voting for, measures that bring manufacturing back to the U S or keep it here. We got to do everything we can to keep it here. And we need to keep as much here as possible. know the automotive industry has taken a massive hit with all this globalization. And I have family who was on the Ford assembly line.
Back in the day, my uncle did the headlights. My aunt did the grills. My family, they're from Michigan. That was their jobs. That was their careers was working on the, the Ford assembly lines. You know far more about what's happening with automotive manufacturing and who's doing what where than I do these days. And by the way, I just want to clear up the record. do ride motorcycles, but I don't ride street bikes.
Yeah, I would make a distinction between a dirt bike and a motorcycle. A motorcycle, you're stupid enough to go out on asphalt and hurt yourself. is smart enough to land on soft like dirt.
I have some scars that prove that the dirt isn't so soft. I don't ride much anymore. I had a couple of accidents that really, I was very fortunate not to have broken anything. And I have a very hard time slowing down. When I'm riding a dirt bike, I love to go off jumps and I love to go fast. I grew up riding street bikes with my dad, but.
I myself have never owned a street bike. I am very disappointed to hear that Harley-Davidson did that. I did not know that.
Speaker 2 (50:26.606)
Yeah, I that was wild when I saw that video. I thought he was such a good journalist to put that in when he was talking about the history of Harley Davidson and where they are now. To turn around and do that, mean, there's a similar story from around the same time. In January of 2018, Whirlpool had successfully lobbied for the Trump administration to impose tariffs on foreign-made monitoring machines. I think it was. Another household appliances. And they came with evidence that
Anything.
Speaker 2 (50:56.576)
other companies manufacturing in other countries were purposefully dumping products in this market to undermine Whirlpool's American manufacturing position with the intent of driving them out of the market and then increasing prices. And that's a very different case than the case that Harley-Davidson is making where Honda, Yamaha, BMW all make cruiser motorcycles that fulfill the same obligation as a
Harley Davidson to some at least, there's a nuanced argument to be made there without doing something so wildly long-term economic strategy as dumping products, as artificially decreasing the price of the product below where they can even make a profit for the sake of pushing Harley out of the market. Each tariff that may or may not be applied may be applied for different reasons. The washing machine one, if it's true that...
other countries were artificially going below their profit margins to be able to push Whirlpool out of the market. That's the kind of tariff I can get behind because that is protecting American labor. That's protecting labor period. That's just a company pushing another company out. Maybe it has less to do with American versus non-American labor. That's just a business strategy someone's trying to execute to eliminate their competition. You just got to do the research on what's going on with each tariff that's being imposed and why and the history of that market.
Well, read your labels, ask your questions, do your research, vote with your dollars, and bring manufacturing back to the US and do what you can to keep it here. Thanks everybody for joining us today. We'll see you next time. Watch us on YouTube at YellowstoneProfessionalEd.co. Don't forget to like.
Hope you learned something.
Speaker 1 (52:46.494)
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