Why Does GSA Advantage Encourage Country of Origin Fraud?

Why Does GSA Advantage Encourage Country of Origin Fraud?

One of the main sites that the Federal Government uses to guide Federal agencies on where to procure products and services is GSA Advantage. It’s a pretty cool Web site. If you’re a government procurement employee, you can go right onto the site and search for products to buy for your office. You can connect straight to an approved vendor to order what you need.

It’s a great way to make sure that what you procure is legally compliant. One important criteria to look at when making government purchases is, of course, the country of origin.

There’s only one problem. From what I can tell, GSA Advantage is run on “the honor system”: contractors who bid for government contracts provide the country of origin information.

And virtually all of it is wrong.

What Is Federal Law About “Made in USA” and Government Procurement?

It’s been Federal Law since 1933 that when employees of the Federal Government procure products they must “favor” products made in the USA. Specifically, it’s an act signed by President Herbert Hoover in 1933 called the “Buy American Act”. Simply put, the law says that any product used by the US Government must be made in the USA unless that product is simply not made here or the cost would be prohibitive.

There have been other laws put into effect since then that add onto it, such as the Buy America Act passed in 1982 that applies to transportation infrastructure, or the Build America Buy America Act passed in 2021 that applies to all infrastructure projects. In 2021, President Biden also signed an Executive Order establishing The Made in America Office to provide more clarity and transparency on the various rules.

Free market absolutists may argue that this will result in the government not getting the best value for we, the taxpayers’ money. And there’s a certain truth to that.

On the other hand, we’re at a point in our history where granting MFN status to China has resulted in our greatest geopolitical rival having complete monopoly over the means of production of everything from computers to medicine. That means power that American corporations have foolishly handed over to Beijing on a silver platter. If a $500 product requires a $1 widget to work, and China is the ONLY country in the world who can produce that widget, does anyone in their right mind believe that the cost of that widget will remain at $1 forever?

Even worse, we saw first-hand the consequences of that in 2020 when front-line workers had no PPE because China was hoarding the supply and there were no American manufacturers left who made it. Does anyone in their right mind believe that China will NOT use their monopoly power in manufacturing to extort us as they did then?

Enforcing the requirement of Federal Agencies to procure products made in the USA accomplishes several things. It creates opportunities for American entrepreneurs and workers who would otherwise be unable to compete with countries that encourage IP theft and slave wage labor. It keeps more of our tax dollars within the US economy, supporting local communities.

What is GSA Advantage?

GSA Advantage is a Web site run by the General Services Administration, the branch of the Federal Government that manages procurement, i.e., buying stuff for all of the almost 3 million employees of the US Government, from airplanes to paper clips.

This gives them a LOT of buying power. In fact, they are the single biggest buyer of products in the world.

Anyone who wants to sell products to the Federal Government must have a government contract. Most major US companies have government contracts, as well as distributors and wholesaler companies that resell products. They need to bid on the right to sell their products to the government, and those contracts will last a few years.

GSA Advantage does a pretty good job, especially for a government-run site, of showcasing the vast array of different products available from all the different contractors. Even better, the site shows the Country of Origin of each product. This allows government employees to easily see which products are made in the USA, so they can favor those products. It also allows them to avoid products made in China, whether for legal reasons (there are several categories of products that the government prohibits Federal employees from buying) or simply for the same reasons that you and I avoid made in China, from their corruption to their animal rights to their human rights to their safety and environmental record.

How Accurate is Country of Origin on GSAAdvantage.Com?

As you all know, I spend hours going through records trying to find products not made in China. So I was at first pleasantly surprised to see that virtually NONE of the products listed on GSA Advantage was made in China.

And then I started peeling the layers of the onions. Virtually ALL of the information about Country of Origin is wrong. Whether it’s incompetence or being deliberately misleading, I’ll let you decide (I’ll give my own comments below). But one thing is for sure. We, the American taxpayer, are paying for something that is broken.

Toasters

I decided to start with the two categories that have caused me the most agita over the last few years: toaster and bathroom scales.

“Okay,” I thought to myself. I saw a lot of toasters made by Dualit, which I knew from researching my article on best toasters are made in Great Britain.

There were also a lot of industrial models from companies like Hatco that I’m fairly certain are made in the USA (even though their lower models are made in China).

But as I surfed around a little more, I saw some disturbing things.

Here’s a listing from a contractor named “MG Scientific, Inc.” It’s a Hamilton Beach toaster that I recognize from my research (31335). This contractor listed Country of Origin as “United States of America”. That’s a lie. All Hamilton Beach products are made in China.

As I went on, I found more examples.

Bottom line, while this category looked legitimate at first, it looks like there are more than a few contractors who are providing false information to GSA Advantage, and no one is correcting them. Hamilton Beach products have all been made in China since the early 2000s, so contractors that list country of origin as the USA are clearly lying.

Bathroom Scales

Hoping this would be a fluke, I searched for “bathroom scales”. At first blush you wouldn’t think this is a product that a government office would need, but we have a pretty big government that includes healthcare facilities, educational facilities, residences, and more places that could use them.

I was happy to see the Tanita HD-662 scale listed, the one brand that I could find wasn’t made in China.

That said, as I went down the list I could see some pretty egregious examples of false information.

  • Tri-State Camera Exchange shows up once again. They list the American Weigh Scales 330LPWBK, 330ECO, Wireless Bathroom Scale, and 330LPG all as made in Taiwan. They’re all made in China.
  • ITIN Scale Co., Inc. lists this SECA 719 scale as made in Germany. It’s made in China.
  • Woodcrest Ace Hardware, Inc. lists this Taylor 6129613 as made in the United States of America. It’s made in China.
  • Strohman Enterprise lists this Garmin Index 2 Smart Scale as made in the United States of America. That’s not even close. The first generation of this scale was made in Taiwan, the current generation is made in China.

And this is all just page 1 for this search.

Again, things are pretty fishy. I see no evidence that American Weigh Scales were ever made in Taiwan. To the contrary, these models all look like generic products being churned out of factories in China. Similarly, Taylor and SECA have long ago outsourced to China.

Laptops

When I navigate the GSA site for Notebook computers, here’s are the results I got when I tried it (your results may vary, but you’ll see the same patterns).

Of the first 25 results, 16 of them were Microsoft Surface laptops. The listing says they were made in Taiwan.

Here’s the problem, Microsoft Surface computers have been made in China for years.

There are reports that since the passage of the Trade Agreement Act (TAA), some Microsoft Surface computers are made in the United States (the TAA applies to federal contracts over $193,000).

But if that’s true, here’s where GSA Advantage is completely misleading. These notebooks are either made in China or the United States of America. While a Taiwan-based ODM may have managed the production of these machines, Taiwan was never the final country of assembly.

Worse, when I look at other listings, it’s pretty clear that contractors are playing fast and loose with the rules.

  • HP Elitebook – Listed as Made in Mexico or Made in Taiwan. While there have been some reports that HP will be moving production to Mexico (in which case government contractors will likely get the first dibs at that inventory) there isn’t a lot of evidence (yet) that models are coming out of Mexico just yet.
  • Dell Latitude – Listed as Made in Taiwan. Once again, this might be where their ODM is based, but it’s certainly not where their computers have been made for many years.
  • Lenovo ThinkPad – When IBM made these they were made in Mexico. But that was years ago. Even worse, Lenovo is a China-owned company now. So why are they still being sold to the US Government?

Tea Kettles

Finally, let’s look at the most-researched category of products not made in China: tea kettles. This is another one I spent hours and hours researching.

As is typical for a GSA site, the first few listings are going to be industrial kettles for use in kitchens, mess halls, and other big government-owned facilities. There’s a decent chance those are legitimately made in the USA.

However, once you get to consumer-level material you start to see the same patterns.

Here’s our old friend Tri-State Camera Exch., Inc. telling us that this Brentwood KT-1610 electric kettle is made in Taiwan. That’s false. It’s made in China. This contractor also lists this Brentwood KT-1900BK as made in Japan. That’s false too.

The one accurate listing I saw, from contractor Blue Fish Worx, is this hot water boiler from Panasonic, which legit appears to be made in Japan.

Mind you, these are just four arbitrary categories I looked up and they all misrepresent the country of origin.

As I spot-check other categories, I see hundreds and hundreds of other products made in China that are mislabeled as made in Taiwan or even made in the USA (especially ironic given that American-owned small business are getting fined out of existence if they run even slightly afoul of the FTC’s Made in the USA rules, while the GSA and its contractors themselves violate these same rules thousands of times on their own Web site).

Why is it so inaccurate?

I literally went through hundreds of products that I knew to be made in China and didn’t find “China” listed ONCE as country of origin.

If there were a few inaccurate listings among thousands, that’s one thing. But seeing listing after listing after listing of false information leads me to believe that there’s something shady going on.

In most cases, the contractor who is entering the information online is clearly being misleading in order to improve its chances of landing the contract and generating sales.

Here’s the chilling effect that these listings with false countries of origin have.

A government purchaser may look at the country of origin and take it at face value—they may see that something is made in the United States or a free country like Taiwan and buy up hundreds of these products.

The result is that millions of our taxpayer dollars goes to support China and perhaps worse, legitimate manufacturers in the USA and Taiwan get NO government business. That’s terrible.

What Can I Do as a US Taxpayer About This?

As a US taxpayer, the first thing you need to do is to get angry.

  • Why are contractors providing inaccurate country of origin information?
  • Why is the GSA allowing this to happen en masse without any scrutiny?
  • How many government buyers are buying up these products based on false information?
  • How many legitimate manufacturers of products outside of China are losing contracts because of false information?

While the notion seems antiquated these days, the first step in getting change from your government is to write to your Senator or Congressperson. If they ignore you or brush you off, you know what to do come November.

The more useful strategy these days seems to be public exposure. Share this article on Facebook or X. Go to GSAAdvantage.gov yourself and look up products yourself.

The one thing not to do is stay silent. If you get taxes taken out of your paycheck, then it’s your money that’s being used to support China every time a contractor lies about country of origin.

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