Tuesday, July 06, 2010

Is it possible to be an all-American company?

In addition to keeping jobs in the U.S., buying American uses less energy for shipping products. A sad thing is that in order to compete with cheap Chinese labor, U.S. companies such as this have to be heavily automated, reducing the job created. And the costs of Chinese labor are kept artificially low by the Chinese government manipulating currency values.


by Kari Huus Reporter
updated 7/6/2010 5:45:42 AM

ONTARIO, Calif. — Anthony Maglica has lived the American Dream – arriving in booming post-war United States as a penniless young man, he made his way to California in a rusty Studebaker, worked hard and saved just enough money to start his own business. He parlayed the humble sum of $125 into a business empire.

Maglica’s company, Mag Instruments, has sold 420 million of its aluminum-encased flashlights since 1979. Its Maglite brand is known worldwide as a high-quality American product.

But the company’s story illustrates just how difficult it is to be all-American. Not only does it face a flood of cheap imports, but Mag is in perpetual legal battle to protect itself from copycats. And, in spite of Herculean efforts to make or source all components domestically, Mag falls just shy of 100 percent — not close enough, under state laws, to be labeled “Made in USA.”

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Mag long proudly sported the “Made in USA” label on its products, but it was recently forced to stop because of two imported components — an O-ring and a light bulb — that Mag says are not produced by anyone in the United States.

The issue is not with the federal regulations, which say that “Made in USA” is OK if the value of a product is “substantially” domestic. But a California law prohibits the Made in USA claim when any part of the product is made outside the United States. That law has been on the books for many years, but a flurry of cases taken up since 2005 has forced companies either to drop the Made in USA claims or create California-specific packaging.

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cansWorking. “But we also have to be realistic.”

For Maglica, the California law is just another example of ways that government is hindering U.S. businesses, and job creation, through heavy-handed regulation and taxation.


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