Garamendi, Stabenow Urge Review of Reciprocal Defense Procurement Agreements Reform

WASHINGTON, D.C.—Today, U.S. Representative John Garamendi (D-CA), the top Democrat on the House Armed Services Subcommittee on Readiness, and U.S. Senator Debbie Stabenow (D-MI), a senior member of Senate Democratic Leadership, sent a letter to White House Made in America Office’s Director Livia Shmavonian urging her to ensure that the U.S. Department of Defense’s (DoD) trade agreements—formerly called reciprocal defense procurement agreements reform—with allied foreign militaries are fair for American workers and domestic manufacturing.

Under the National Defense Authorization Act for Fiscal Year 1989 (Public Law 100-456), Congress required the U.S. Department of Defense to consider the impact of any proposed reciprocal defense procurement agreement on the United States’ industrial base. However, the Pentagon does not appear to track purchases by foreign militaries under these agreements, meaning it cannot determine whether any such agreement is indeed reciprocal in practice.

Furthermore, unlike other trade agreements or treaties, these agreements are negotiated by the DoD and are not subject to Congressional approval. Reciprocal defense procurement agreements also allow the Pentagon to override Congressionally mandated "Buy American" requirements that would typically apply to defense procurement, allowing foreign defense contractors to sell to the U.S. military, even if undercutting or displacing American-made products and workers.

“Given the significance of these agreements for defense procurement by the U.S. Department of Defense and our country’s strategic partner nations, we urge the Made in America Office to complete the Congressionally directed review as soon as possible. In addition to furnishing the final report to the OMB Director and the Secretaries of Defense and State as required by law, we request that you provide our offices with a status update on this review and the final report, when completed,” said the lawmakers.

“While we appreciate the strategic importance of interoperability between the U.S. and allied militaries, we are concerned that the DoD is not well-positioned to assess fully the significant implications of these agreements on our defense industrial base, particularly for small and medium-sized domestic manufacturers. As the number of reciprocal defense procurement agreements continues to grow, we believe these agreements should be strengthened by greater interagency input and Congressional oversight. At our request, the U.S. Government Accountability Office (GAO) is currently completing a review of all existing reciprocal defense procurement agreements,” continued the lawmakers.

“As GAO conducts our requested review, we again urge the Made in America Office to also complete a thorough review of existing reciprocal defense procurement agreements, as required by the 2021 law, to ensure such agreements consider national priorities beyond narrow defense interests,” concluded the lawmakers.

Last Congress, Representative Garamendi and Senator Stabenow co-authored the “Make It in America Act,” enacted as part of the Infrastructure Investment and Jobs Act (Public Law 117-58). Their 2021 federal law both established the White House’s Made in America Office and directed that Office to review all existing reciprocal defense procurement agreements to determine if they do indeed provide reciprocal opportunities for U.S. manufacturers to export.

In November 2022, Congressman Garamendi and Senator Stabenow also requested a U.S. Government Accountability Office (GAO) review of reciprocal defense procurement agreements, which is now underway.

While Representative Garamendi and Senator Stabenow support the Biden-Harris Administration’s efforts to strengthen our international alliances and military cooperation, the law is clear that these agreements were never intended to undermine American workers. This letter is one of many steps to ensure there is appropriate oversight of these DoD agreements.

Existing Reciprocal Defense Procurement Agreements: Australia, Austria, Belgium, Canada, Czechia, Denmark, Egypt, Estonia, Finland, France, Germany, Greece, Israel, Italy, Japan, Latvia, Lithuania, Luxembourg, Netherlands, Norway, Poland, Portugal, Slovenia, Spain, Sweden, Switzerland, Turkey, United Kingdom.

The Biden-Harris Administration has proposed new reciprocal defense procurement agreements with Brazil, India, and South Korea.

The full letter is available here.

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