New Balance on Tuesday accused the Obama administration of walking back its promise to consider the Boston-based shoe maker for a potential Pentagon contract after the company reluctantly loosened its stance on a proposed multinational trade agreement.
Speaking to the Boston Globe, New Balance’s vice president of public affairs, Matt LeBretton, said the sneaker company was told it had a chance at a lucrative deal with the Defense Department if it relented criticism directed at the Trans-Pacific Partnership, a potential trade agreement between the U.S. and 11 Pacific Rim countries.
New Balance had previously insisted publicly that the TPP would devastate the company’s domestic operations because passage would eliminate tariffs on footwear made in Vietnam and drastically reduce the cost of imports. Despite being adamantly opposed to the TPP for several years, last June the company had reportedly become “cautiously optimistic” with respect to the president’s proposal.
According to Mr. LeBretton, that sudden silence was a direct result of New Balance believing it had a chance at making athletic shoes for the military.
“We swallowed the poison pill that is TPP so we could have a chance to bid on these contracts,” he told the Boston Globe. “We were assured this would be a top-down approach at the Department of Defense if we agreed to either support or remain neutral on TPP. [But] the chances of the Department of Defense buying shoes that are made in the USA are slim to none while Obama is president.”
While nearly all of the apparel ordered by the Pentagon is American-made, an exception that applies to athletic shoes has allowed the government for years to save money by buying sneakers from abroad, the Globe reported. The Defense Department agreed in 2014 to begin weighing its domestic options, and Mr. LeBretton said New Balance was told it would be considered for contract if it loosened it anti-TPP stance.
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A representative for the Obama administration asked New Balance to accept a compromised version of the TPP, and in exchange offered to help get the Defense Department to expedite purchasing American-made shoes, Mr. LeBretton told the Globe. With the White House making TPP passing a priority, however, New Balance says the administration hasn’t bought any American sneakers.
“The Department of Defense has basically played a shell game with domestic footwear manufacturers to protect the profits of their [base stores],” he told the newspaper. “They’ve put up roadblock after roadblock. Our shoes are ready to go. It’s a bureaucracy run amok.”
A spokesman for the Office of the U.S. Trade Representative told the Globe that the White House supports New Balance’s efforts, but isn’t contracting on account of cost requirements, as well as the product’s inability to meet the Pentagon’s durability standards.
“It is unfortunate that, despite a strong outcome in TPP that advances the interest of U.S. footwear workers, New Balance now appears to be changing its position on TPP in response to the Pentagon’s separate procurement process,” spokesman Matt McAlvanah said in a statement.
New Balance is owned by Jim Davis, a longtime Republican donor, and employs roughly 1,400 people across five factories in New England. Most of the world’s athletic shoes are made in China, however, and Vietnam has managed to gain ground in recent years despite steep tariffs that could be rolled back with passage of the TPP.
In May, Mr, Obama touted his TPP proposal during an appearance at the Oregon headquarters of competing company Nike. On its part, Nike said TPP passage would “accelerate development of new advanced manufacturing methods and a domestic supply chain to support U.S. based manufacturing” and create upwards of 10,000 American jobs. With regards to sneaker factories, however, Nike shuttered its last in the U.S. in 1985 and now employs more than 1 million workers in 42 countries abroad.
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• Andrew Blake can be reached at ablake@washingtontimes.com.
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