FTC: Made In The USA Comments Concerning Darlene S. Adkins--P894219
1701 K Street NW · Suite 1200 · Washington DC 20006 · (202) 835-3323 · FAX (202) 835-0747
August 11, 1 997
Office of the Secretary
RE: Made in USA Policy Comment
The National Consumers League strongly opposes the proposed "Guidelines for the Use of U.S. Origin Claims." The lowering of the standard will result in consumer misinformation and deception. NCL urges the FTC to maintain the current standard of "all or virtually all" for the use of "Made in USA" claims.
Founded in 1899, the National Consumers League is America's pioneer consumer advocacy organization. Its mission is to identify, protect, represent, and advance the economic and social interests of consumers and workers.
NCL actively represents consumers in fair labor standards, health care, food and drug safety, technology and telecommunications, and fraud. For nearly 100 years the League has vigorously worked to protect consumers from deception -- in telecommunications, in product and food labeling, and other forums where consumers may be misinformed or misled.
NCL is a member of the Made in USA Coalition which is comprised of consumer groups, businesses, and labor unions. Coalition members are united under the goal of maintaining the current FTC standard for use of "Made in USA" claims on packaging and advertisements.
NCL disagrees with the FTC proposed guidelines and the three assumptions upon which they are founded:
Research on consumer perception of "Made in USA" substantiates the FTC imposing a new, lower standard.
As the FTC is charged with upholding truth in labeling and advertising, it is imperative that new standards are not instituted without an exhaustive review of consumer perceptions about the meaning and usage of "Made in USA.
Although two FTC consumer studies and other limited research are cited, a close review of the questions asked, notably how they are worded and what remains unasked, negates many of the conclusions reached on consumer perception. The FTC states that "...many consumers are likely unaware that there are various alternative constructs for evaluating 'Made in USA' claims and may not articulate a precise definition of 'Made in USA.'" NCL contends that the difficulties arise not out of consumer unawareness or inarticulation, but from poorly constructed questions and surveys that fail to delve deep enough into the issue of what constitutes "Made in USA' in consumers' mind and their expectations when they see the claim.
Consumers at a minimum recognize the complexities of U.S. participation in an increasingly global marketplace and some have already or would accept a reduced standard for ."Made in USA as a response to that recognition .
The FTC claims its proposed guidelines reflect the changing global marketplace. Indeed, the economy is changing, trade barriers are falling, and the way we do business is altering. However, these changes do not mean that consumer attitudes about minimum standards met in "Made in USA" are revising in response.
The consumer surveys cited by the FTC do not adequately support the above stated assumption. The NCL survey of its consumer members and other cited studies indicate that the "all or virtually all" standard is compatible with consumer perception. Given the absence of comprehensive data to indicate otherwise, it is NCL's contention that the FTC's new proposed standard would lead to consumer deception.
The confusion that would be created would directly contradict the primary purpose of utilizing labels to provide an effective consumer information tool.
Moreover, consumers may respond to increased globalization by placing more value on stringent criteria governing Made in USA claims.
Qualified "Made in USA claims are not a workable alternative for consumers or businesses.
Under the current FTC standards governing "Made in USA, marketers are free to make any qualified U.S. origin claim which is truthful and substantiated. Companies may already promote the U.S. content of their products honestly. For products not wholly made in the U.S., companies can make a truthful claim about whatever U.S. content their products have (e.g., "Made in USA" of 75% U.S. component parts).
Companies claim that qualified "Made in USA" claims are costly and impractical for businesses and are confusing to consumers. Regardless of the claim that qualified labeling is costly and impractical, the bottom line is that "Made in USA" claims are not a requirement. It is a marketing tool that companies may utilize and it is up to them to determine if any increased costs and aggravation are offset by the increased stature their product may gain among consumers. It appears that manufacturers want relaxed standards so that they may gain the right to use "'Made in USA" as they profit from overseas parts and labor. Obviously, businesses do not fail to recognize the influence "Made in USA" generates in a consumer's buying decision.
Manufacturers also state that qualified "Made in USA" labeling is confusing to consumers. This is inaccurate. Consumers are able to differentiate claims as long as there is consistency in the language (i.e., clear definitions of words used, no ambiguous wording); and there is consistency in application and presentation of claims.
Moreover, consumers are increasingly becoming sophisticated shoppers. Note the recent changes (expansion) of nutrition labeling, which was prompted in large part because consumers wanted more detailed information and more choices in the marketplace. It is also appropriate to note that consumers are capable of dealing with fractions when they compare products. For years now, consumers have been provided detailed information on the content of garments. If a shirt can be labeled as 75% cotton and 25% silk, then a product can be labeled 75% U.S. parts and 25% foreign parts without running the risk of confusing the public.
NCL urges you to reject these new guidelines for "Made in USA claims. Much more extensive consumer research and input is needed before such a drastic revision is made to the FTC standards. NCL would be very pleased to work with the FTC in securing a more comprehensive review of consumer perceptions on "Made in USA." Thank you for the opportunity to provide comments on the proposed guidelines.
Darlene S. Adkins
Representing Consumers for 98 Years