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Sourcing Summit Presentation: “Political Dysfunction in the Supply Chain” By Kevin Burke


Kevin Burke, President of the American Apparel and Footwear Association, gave the one stand-alone presentation of the day at Sourcing Journal’s first annual event, “Sourcing Summit: Reflections and Projections 2013.” It was entitled “Political Dysfunction in the Supply Chain,” and explored the many and diverse ways governmental inefficiency stymies healthy commerce.

Burke’s presentation lambasted congressional stalemates generated by uncompromising partisanship as corrosive of robust business. And while he acknowledged he has historically been a Republican intestinally skeptical of bureaucratic interference into free markets, he also conceded that some regulatory oversight was absolutely necessary for efficient economic trade.

The fulcrum of Burke’s speech was the shutdown of the US federal government, a woeful exemplar of unhinged partisanship undermining the possibility for reasonable, pragmatic solutions to imminently solvable problems. And while he argued that “conventional wisdom and personal experience” pointed in the direction of this latest episode of political “brinksmanship” being short lived, the current dispute dragged on interminably, generating measurable economic harm.

According to Burke, a negligent media failed to adequately document the consequences of the shutdown, especially in the apparel and textile industries. These governmental “disruptions” created by internecine fighting resulted in “shuttered agencies, dark websites and ambiguity in the contracting area causing mounting costs and cash flow issues.” Also, even the final resolution was little more than a self-congratulatory act of congressional procrastination, postponing the real issues for yet another damaging stalemate just a few months from now.

The government shutdown came at a particularly bad time, when numerous, historically consequential free trade agreements are in delicate stages of negotiation. These issues include the US extension and renewal of its Generalized System of Preferences (GSP) program, renewal of Trade Promotion Authority, renewal of Trade Adjustment Assistance, the Trans-Pacific Partnership, the Trans-Atlantic Trade and Investment Partnership and the Miscellaneous Tariff Bill. The closing of key US trade offices amounted to an abdication of any necessary oversight of these essential developments.

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And while Burke was critical of government overreach, and has spent much of his long career in government relations advocating for a lighter congressional imprint on business, he also maintained that the AAFA does not take an “anti-government position.” In fact, his organization recognizes the “the strong and positive role that a functioning and well run government can have in establishing and ensuring a fair competitive environment for our members.” This role is especially valuable when it comes to “providing valuable information, ensuring a predictable and transparent regulatory environment and advocating for US interests globally.”

Given the central role government necessarily plays in global commerce, Burke urged for “procedural improvements” as well as revisions of policy, so that that the key functions of government could not so easily become impeded by partisan infighting. He cautioned that “compromise” should not be considered a “dirty word,” but rather a collective goal. In its best iteration, according to Burke, a well-functioning government is not an impediment, but an advantage, to the long term interests of the business community. This ideal represents the best democracy has to offer and conduces to the best a reasonably free market can produce.