Tuesday, July 17, 2012

Olympics, "Made in China" and a furore

With the Olympics a few days away, a controversy has erupted in the U.S. over China made uniforms that the U.S. delegation is going to wear to London. Who would have ever drawn a connection between Olympics and "protectionism"?

Critics in the U.S. have objected to the U.S. Olympic Association having procured the official dress of the U.S. delegation to the Olympics from China.It had to be China! They have insisted that U.S. sportspersons should wear uniforms and dresses made in the U.S. rather than from outside.

An interesting fact is that though the dresses were made in China, it was by a New York based American company, Ralph Lauren. There were angry calls of rejecting them with some representatives saying:
“I am so upset that I think the [U.S.] Olympic Committee should be ashamed of themselves, I think they should be embarrassed, I think they should take all the uniforms, put them in a big pile and burn them and start all over again.” 
Cafe Hayek has an interesting point - are the garments "Made in China" at all? Echoing a letter to the WSJ, it  signifies a "Made in the World" reality rather than being made in a particular country:
"As you suggest, the 2012 U.S. Olympic uniforms are labeled “Made in China” simply because workers in China supplied the relatively low-valued-added service of stitching together inputs from all over the globe – including from America – into their final form as Olympic sportswear.  The unfortunate convention of identifying the country of final assembly as the country in which a good is “Made in” masks the fact that nearly all goods today are “Made Everywhere on Earth.”
China, expectedly, reacted rather strongly calling the attitude of the U.S. "hypocritical" and "irresponsible".It was reported here and here.

Some thoughts:

I wonder what percentage of Olympic dresses that sports delegations from across the globe wear   at the Olympics would belong to the country of the sportsperson? What about the sports equipment? Which country dominates exports of sport equipment? Should countries shun importing the best state of the art equipment for their respective teams and instead rely on locally produced equipment? Unthinkable? Olympic spirit and globalization go hand in hand?

Writing in the CATO Institute blog Daniel Ikenson has this thoughtful retort on the issue:
"If you are still not convinced that our policymakers’ objections are inane, consider this: As our U.S. athletes march around the track at London’s Olympic stadium wearing their Chinese-made uniforms and waving their Chinese-made American flags, the Chinese athletes will have arrived in London by U.S.-made aircraft, been trained on U.S.-designed and -engineered equipment, wearing U.S.-designed and -engineered footwear, having perfected their skills using U.S.-created technology."
The WTO website coincidentally published today the Panel report on the China Electronic Payment case that the U.S.  had filed against it which China lost. More fodder for the critics of  global trade on both sides? The USTR website has the official response to the Panel Report:
"“This decision will help U.S. companies and increase American jobs as a more efficient credit and debit payment system in China enables consumers to buy more goods, including quality, made-in-America products,"said Ambassador Kirk."
"Made in America" products for consumers in China but no "Made in China" products for US Olympians?

Update: Ralph Lauren calling itself a "proud outfitter of Team USA" released a rather unapologetic statement about the controversy:
"“For more than 45 years Ralph Lauren has built a brand that embodies the best of American quality and design rooted in the rich heritage of our country. We are honored to continue our longstanding relationship with the United States Olympic Committee in the 2014 Olympic Games by serving as an Official Outfitter of the US Olympic and Paralympic teams.
Ralph Lauren promises to lead the conversation within our industry and our government addressing the issue of increasing manufacturing in the United States and has committed to producing the Opening and Closing ceremony Team USA uniforms in the United States that will be worn for the 2014 Olympic Games.”
What next? 

1 comment:

Winnowed said...

Good article, raises interesting issues. Patriotism, scoundrel, last refuge etc. come to mind.

Until now, and even now, there is no call to avoid buying Ralph Lauren even though it has outsourced to China. Funnily, no one is asking why Ralph Lauren got to design and manufacture attire for the US team, even though it gets its manufacturing done in China. Having got the contract, the patriots seem to expect Ralph Lauren to set up a plant in Texas just to make the Olympic outfits.