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It seems simple enough: To be labeled as “Made in America,” a product sold in California must include only components manufactured and assembled in this nation.
But that’s a tougher standard than elsewhere in the country, where small amounts of foreign parts don’t invalidate the label. And now it’s touched off a debate among business interests and consumer rights groups, as state lawmakers consider lowering the threshold included in the state’s 52-year-old labeling law.
Richard Russell, chairman of the board of Russell’s Furniture, is opening a new store in San Mateo on Feb. 1 that he originally planned to call “Made in America.”
But he changed the name to “Russell’s Furniture American Pride/Bringing Jobs Back Home” after his suppliers — including Amish craftspeople from Ohio — could not guarantee that every single component originated in America, which would meet the California standard for labeling a product Made in America.
“We’ve seen plant after plant shuttered and I want to support American manufacturing and bring jobs back to America,” Russell said. “But I don’t want to get sued. It blows me away that I can’t say ‘Made in America.’ It gets me upset.”
The idea of watering down California’s standard bothers Richard Holober, executive director of the Consumer Federation of California, which opposed an earlier draft of the bill that would have allowed products to carry a “Made in America” label if 90 percent of the parts were made and assembled in the United States.
“It’s about truth in advertising,” Holober said. “The California standard is clear and you don’t get into the problem of subjectivity. What’s wrong with being honest? Why is it such a problem to simply say, ’90 percent Made in the USA?’ “
Businesses counter that they’re punished in the marketplace for trying to comply with California’s law because many of their competitors ignore it and label their products American made and sell them in California even when they contain foreign parts.
Nationally, the Federal Trade Commission oversees guidelines that are less restrictive than California’s, saying that a product claiming to be made in the USA “must be all or virtually all” made in America, said Julia Solomon Ensor, an attorney in the enforcement division of the FTC’s bureau of consumer protection.
“On the one hand, of course we think it’s important for companies to promote the good work they’re doing in the USA,” she told this newspaper. “On the other hand, our primary goal is to prevent consumer deception.”
The national standard of “all or virtually all” leaves plenty of wiggle room for interpretation. The FTC will suggest ways for companies to comply, but the decision on what meets the FTC guidelines is left to the nation’s civil courts, just as California civil courts determine whether a product meets the state standard.
In California, it’s against state law to include a “Made in America” or “Made in the USA” label when any part of the product “has been entirely or substantially made outside of the United States.”
That means every single part essentially has to be made and assembled in the United States to carry a “Made in the USA” label in California. But representatives for business say it’s a standard that’s virtually impossible to meet in today’s global market.
A proposed revision of the law, SB 661, would allow goods containing foreign-made parts to be advertised as “Made in America” or similar phrases — as long as the parts cannot be found in the United States and as long as the foreign parts constitute a “negligible part” of the final product.