Trump Executive Order Calls for More Aggressive Use of the Buy American Act—An Order Likely to Have More Political than Practical Effect

Abstract

President Trump recently issued an executive order, EO 13881, 84 Fed. Reg. 34257 (July 15, 2019), calling for more aggressive application of the Buy American Act. The new order calls for the Federal Acquisition Regulatory Council to strengthen domestic preferences under the Act. The order was long predicted as another step in the Trump administration’s advancing protectionism. Indeed, most of the Trump administration’s protectionist initiatives have been foreseeable from the outset, for the Trump administration has consistently embraced those initiatives that provide maximum political benefit at minimum cost. But developments since Trump took office—including new data that show that the Buy American Act applies to a markedly small portion of federal procurement, and emerging electronic marketplaces that could swallow up much of that small market share—may mean the new executive order has far more impact politically (both in the U.S. and abroad) than it does practically.

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JEL Classification: F10, H57