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Loading ...Outsourced condom production could shut US factory
03.27.2009 8:48am EDT
The last U.S.-based supplier of condoms for global HIV/AIDS prevention programs could be forced to shut its doors because the federal government sent the work to cheaper suppliers in Asia.
The change came earlier this month as Congress dropped a requirement that the government buy American-made condoms when possible, with exceptions for price and availability.Congress traditionally has directed the U.S. Agency for International Development to use American suppliers for the hundreds of millions of condoms it sends into developing countries. The main supplier to benefit from that directive is Alatech Healthcare Products, a southeastern Alabama company with about 300 employees.
Over the years, Alatech became the program’s sole U.S. provider.
USAID says Alatech has had problems filling orders, and there were complaints from the field about the quality of its condoms.
Despite Congress’ direction, the agency has gradually outsourced part of the work to companies in Asia that provide condoms for less than half of Alatech’s price.
Just after Congress omitted “buy American” language for the program in its latest spending bill, USAID quickly signed new contracts with three foreign suppliers and dropped Alatech altogether. The new contractors are in China, South Korea and Malaysia.
“Our responsibility is to provide good stewardship for the taxpayers’ dollars,” said agency spokesman Harry Edwards. “That is what we are trying to do.”
Company President Larry Povlacs said Alatech provided durable condoms at USAID’s request and was never asked to address any complaints about that style. He said USAID simply wanted the cheapest product without regard for his workers in Dothan and Eufaula, Ala.
“I’m faced with telling people that I’ve worked with for 30 years that they may no longer have a job,” Povlacs said.
Gloria Steele, an assistant administrator at USAID, said Alatech’s price of about 5 cents per condom versus 2 cents elsewhere wasn’t competitive, even when using a preferential contracting advantage that agencies give domestic bidders. The work has traditionally been worth between $10 million to $20 million per year, Steele said, with annual production of about 400 million to 500 million condoms.
Povlacs said he had received assurances that USAID would continue buying domestically, and his company has spent millions of dollars to ramp up production.
“Congress’ intent has been to buy American,” Povlacs said. “They put that in appropriations bills year after year.”
Povlacs said he is working with lawmakers to get “buy American” language restored in next year’s spending bill, and company officials are meeting with USAID this week.
A spokesman for Rep. Bobby Bright, a Democrat whose district is home to Alatech, said he also is exploring other avenues to help the firm.
Povlacs said the USAID work made up the bulk of his business, and he is faced with closing “within a matter of weeks.”
Hmmmm, lets see… lead in their toys, bad milk etc. Sounds like we shouldn’t be trusting our safe-sex practice devices to Asia at all.
………… “Our responsibility is to provide good stewardship for the taxpayers’ dollars,” said agency spokesman Harry Edwards. “That is what we are trying to do.”………..
First off, Mr. Edwards, let’s provide you with a lesson in basic economics 101 … although providing good stuardship for taxpayer dollars should always be one of a number of priorities at the top of your list at USAID, you need to understand that the ‘employee’, the ‘consumer’, and the ‘taxpayer’ are all one and the same person. Secondly, you need to understand that it is the ‘employee’ part of this trio that funds the other two… ALWAYS, that is unless you are one of the FEW independantly wealthy individuals that doesn’t need to work.
This means that those 300 employees at Alatech Healthcare Products that are about to LOSE THEIR JOBS TO CHINA, SOUTH KOREA, AND MALAYSIA, will now be on unemployment, a minimal consumer at best until their unemployment insurance runs out, and NO LONGER A TAXPAYER because they are now forced to take from the tax base, just to minimally survive, instead of contributing to it !!!… OF WHICH YOUR GOVERNMENT PROGRAM AT USAID IS PAID BY TAXPAYERS, JUST AS YOUR SALARY IS PAID BY TAXPAYERS !!!
When exactly are people like you going to wake up ??? What does it take to make you understand your actions of participating in globalization, privatization, insourcing, outsourcing, free trade policies is precisely the reason we have seen the 500,0000 to 650,000 jobs per month LOSS in the last few months alone, not to mention the millions lost in manufacturing since the passage of NAFTA ???
You can blame Congress for being forced to take out the ‘Buy American’ clause to get BUDGET legislation passed all you want, but the truth is that YOU and YOU ALONE made the decision to USE TAXPAYER DOLLARS TO BUY CONDOMS FROM CHINA, SOUTH KOREA, AND MALAYSIA… SAY GOODBYE TO ALATECH AND 300 MORE TAXPAYERS THAT ARE THE ONLY REASON YOU HAVE A JOB !!! You, Harry Edwards NEED TO BE FIRED, right along with Gloria Steele, the assistant administrator at USAID, and we’ll see just how COMPETITIVE you are when YOUR job and salary is put on a competive scale with someone from China, South Korea and Malaysia, India, Mexico, etc., etc., etc. !!!
So what DOES the US make anymore? Isn’t globalization wonderful? (not)
This country needs a major push towards getting consumers to buy “MADE IN THE U.S.A.” products again! Enough with sending so much of our money outside teh country!
“The change came earlier this month as Congress dropped a requirement that the government buy American-made condoms”
This says it all. “Protectionism” is NOT a bad word folks. Since when did it become a bad idea to protect ones interests?
I don’t want isolationist policies, but I DO want our leadership and management to quit selling out America in the name of greed!
We need serious labor and business reforms to end the temping and outsourcing of American jobs and manufacturing.
Here is another example of mental blindness in Washington, D.C. After all the problems with poor quality and dangerous additives in Asian products, we are still going to buy from them a product upon the reliability of which the lives of many thousands depends. All this to “save” a few dollars which will be more than offset by the costs to the taxpayer of all of these unemployed workers in an area that desperately needs all the jobs it can maintain. Meanwhile, Congress throws money around daily. Has anyone watched some of those Congressional Committee hearings. Have you ever seen so many hangers-on and “staffers” assembled in one place? Or are all of them volunteers? lol
I don’t think I’d want to risk my health or anyone else’s with a condom that may not be of top quality. With all the current adultration of products from Asia, sex becomes even riskier business.
Interesting,
Not one comment to date mentuons that the USA produced product was not of good quality and the USA product was 2 1/2 times more money! The Asian product is 60% cheaper!
Just as the USA automakers have had 40 years to improve their product to compete with the Asian product the condom manufacturer has not improved his product either and like the US automakers they should be allowed to fail and to go away into the history books. If there was an advantage to buying American we would! This supplier of condoms thought that he could charge what ever he wawhnted and the Government would continue to pay! Besides …. he talks of employees of 30 years losing their jobs…. after 30 years don’t you think they should be retired or did these employees not make enough money to retire? This condom manufacturer could be a slum lord style employer. America certainly needs to keep that afloat!
Bruce, Bruce, Bruce…. the reason no one is mentioning anything in your argument is because it’s the same argument that’s been used to get us where we are.
A simple example… A parent/authority figure can can teach a child, from birth, that the sky is green and the grass is blue, and the child will believe it to be factually true simply because there has been no factual alternative presented to refute the teaching. Take this same child years later, after education and experience teaches the truth to the child, their will be no amount of discussion or argument that will be able to convince the child of the prior illusion or lie.
Simply put, experience is the best teacher, even for those who are even half awake out here in the ‘real world’; those who actually face the consequences because they live them day in and day out. At some point, they, like the child, will no longer be convinced that what they ‘live’ is a lie, just because you ’say’ words to the contrary.
It’s like the argument of ‘protectionism / isolationist’ policies, versus ‘free trade’ policies … the truth and reality is that they are simply two opposing words used to define two opposing sides of any given issue, where a play on words is used by one side or the other to gain a favored position or status. It’s doublespeak to argue against ‘protectionist / isolationist’ policies under some guise that some ideal has been achieved where no one is being ‘protected’. The reality is that either both/all sides are ‘protected’ equally, or one side is ‘protected’ in favor of the other, hence the proverbial ‘free’ trade versues ‘fair’ trade argument.
It’s no secret, nor any more well evidenced, that one of the best examples of two opposing sides is found with the Big 3 versus the Auto Workers Union. The automobile side of the U.S. automakers has not moved ahead in the last 40 years because they intentionally made the top down ‘management decision’ to specializing in a ‘niche’ market that catored to the upper middle class buyer where price of the vehicle or fuel was of little or no relevance.
Additionally, this ‘top down’ decision created an all out collusion effort to destroy all unions nationwide, industry wide. This was enabled by making themselves ‘appear’ minimally profitable on the auto side, hence the endless ‘we are unprofitable and need wage and benefit concessions’ argument, all the while concealing that this argument was sustained because they made their ‘real’ profit on the financial side of the equation, not the production side where auto’s are being made. It doesn’t change the fact that they were highly profitable, it’s just where the ‘profit’ showed on the books, which was used to determine who the profit belonged to, and who it was going to be paid to… the ‘production’ side of the equation, or the ’supply’ side of the equation.
Not only did this enable the Big 3 to remain profitable while destroying the Union contracts, which has been highly instrumental in undermining wages, health insurance, and pensions across the board, it stands as one of the strongest examples as to what happens when two opposing sides no longer have to reach a common ground where ALL interests are being served, as in this case, the Big 3 were given the protectionist hand against their workers, and it was backed up and enabled by the loss of government protections for the said workers…. which was and is being enabled because the same small group of ‘controllers’ can be found standing as either a Corporate Executive, and/or serving on multiple Boards of multiple Corporations, and/or serving in some Government position capacity that completes this circle of power all unto themselves… all of this is easily found and proved as a matter of public record.
Lastly, USAID, is a Federal Agency whose sole support is the U.S. taxpayer, both funding the agency, its workers, as well as funding the purchase of condoms for use in foreign countries. It’s certainly a worthy cause to promote condom use in other third world countries, but as long as it is the U.S. taxpayer’s money being ‘donated’ to this worthy cause, it should be in our interest that the donation is being made. If any of these ‘Asian’ countries can ‘produce’ them cheaper, and they want to donate these condoms, all the more power to them. Just don’t ask the U.S. taxpayer to pay an Asian Company our tax dollars, so we can buy them back from them, so we can DONATE them back FREE to the very third world countries that we PAID to produce them.
Can we trust what is made in China? They couldn’t keep our toys safe much less their own milk.
I’m affraid they’ll be to small!
So what? The point here is to prevent the spread of HIV to as many people as possible. Not create American jobs. This like saying we should not find a cure for AIDS because healthcare workers, fundraisers and hospice workers will lose jobs.
So what? The point here is the stop the spread of HIV to as many people as possible. Not create American jobs. This is like saying that we should not find a cure for AIDS because the pharmacuticals, hosptials and funeral homes will lose business.
“Our responsibility is to provide good stewardship for the taxpayers’ dollars,” said agency spokesman Harry Edwards.
So he is fine with putting 300 Americans on the unemployment line, thus pouring taxpayer dollars into their unemployment, rather than spend a few extra pennies for a rubber? That makes a ton of sense. (sarcastic tone)
Dave H,
the US company is charging 60% more.
60% of $10,000,000.00 is $6,000,000.00
6,000,000 divided by 300 = 20,000.00
The American tax payer coud pay each of the 300 employees 20,000 dollars and break even on the deal! I’ll bet most of those employees in the condom factory are not earning 20 grand a year.