Transcripts For CSPAN Senate Hearing On Manufacturing Indust

Transcripts For CSPAN Senate Hearing On Manufacturing Industry Response To Coronavirus Pandemic 20240711

There is a potential of a third vote now, we will not know whether that is happening, but maybe we can work it so we can tagteam the chairmanship. Senator blumenthal i think is back with us. I will make certain he and i can trade positions so we can both vote. If that happens. The committee is reconvened. Mr. Gilman, if you are available , you have about a minute and a half left. We heard your testimony to that last point and we would love to hear your concluding remarks. Can you hear me . Mr. Gilman . Can you hear me . Yes sir. Myi am going to pick up testimony from where i left off . Yes, sir. Ok. I was determined to make isolation gowns because we had the equipment to cut and sew them. I quickly got a sample from a local hospital, design my own pattern, research the materials the gowns were made up, and built a prototype. I sent it to yell new haven hospital, they evaluated it and awarded me an order. There was a surge demand. Hospitals needed more gowns than they could buy from their normal supply chain and they turned to me to bridge the gap. Twofold. Em was the hospitals wanted the gowns fast and they wanted them cheap. To keep the aggressive supply schedule, i had to invest in new machinery and hire more employees. We went from making 200 gowns a week to making more than 12,000 gowns per week. Pricing was an even more difficult hurdle. Hospitals were reluctant to pay more than the price they paid for the product exported from china. I could not match that price unless i moved my factory to china. My gowns are 100 american made. I am at a competitive disadvantage. My labor costs are higher, my material costs are higher. I am able to mitigate some of the cost with technology. At the end of the day, my americanmade gown is two to three times more expensive than those made in china. However, my americanmade gown is of a Higher Quality and meets a higher level of protection. Market and isolation gowns considered a commodity item, buyers in the medical community are just looking for the cheapest price. Plea toe with an urgent the federal government to do more to help with private sector to sustain the ppe business of the United States. Market forates the ppe. The Chinese Government has made manufacturing ppe a priority. Not only from a National Security standpoint, but also with a view to creating a globallyover critical marketplace. The Chinese Government has implemented this strategy by taking following measures. Get factory owners from the Chinese Government. Second, they get subsidies. Third, chinese hospitals are giving chinaocal, suppliers a vast and captive market. Can playal government a vital role in sustaining the United States companies that if itivoted to making ppe will do the following. Americanplement a buy preference across all federal agencies that purpose purchase ppe. Second, create a subsidy for companies that manufacture ppe. Creditestablish a tax for every job created to manufacture ppe. I am not looking for a handout. To use a football term, we want a level Playing Field so we can compete with china. What is at stake is the future of manufacturing ppe in connecticut and across the United States. If we let china dominate the market, if we let them control the supply chain for ppe, doesnt that compromise our ability to cope with this pandemic . Do we want to be at the mercy of china when and if there is a pandemic in the future . What is at stake here is jobs. The 50 jobs we support at gilman gear are precious. If they go to china they are not coming back. What is at stake is our ingenuity and ability to pivot on a dime from a mature business making football equipment to making ppe to serve the medical community. We evolved and we reinvented ourselves during a national emergency. Jobs during the worst economic downturn in our history. Thank you. Testimonyou for your and the response it describes that you provided to covid19. Kraska is our next witness. You are recognized for five minutes. Ok. Located in kansas. I would like to thank senator moran and senator blumenthal for the opportunity to hear my testimony. We started in 1992 in the basement of arkansas home. Our kansas home. We started a business which remains focused on principles. Leadership,servant two, serving our leadership with in aquality products business that impacts people and strive to create economic development. Myself are and involved in the production of for making weapons. At the end of the cold war, the demand declined and we found ourselves looking for a job. Purpose. A sense of we all had a deep love for manufacturing. Employment to people. We experience what happens when a Large Employer has to downsize. In 1992 we launched a business. We became one of the largest toner cartridge manufacturers in the usa. Become fourth of 500 companies and we began to expand. Had become the largest inkjet manufacturer in the world, employing 800 people. The demand was being fueled by skyrocketing growth of inkjet savings, consumer versus namebrand, and the emptyation millions of namebrand cartridges were ending up in landfills. For remanufactured products continued to increase, the components were starting to be developed in china. The dominantecome source of remanufactured components and then five to 10 short years later, the largest of compatible aftermarket cartridges in the world. They were knockoffs of original cartridges exported to the usa with no respect for intellectual property and patent law. China began to flood the market to make it impossible for the u. S. Remanufacturing to compete. Used the china infringing product sound such a scale they would be impossible to compete with. Chinese manufacturers develop their own intellectual property. By that time they had so much scale it was unbelievable. A chinese product was available in china for five dollars. The same product we manufactured would cost 20. U. S. 15, 90 of the 5000 remanufacturing companies were gone. The number of companies that are viable is estimated to be no more than 100 in the u. S. That are still left. Although we continue to manufacture we were forced to choose between buying and selling a line of chinese products or going out of business. Years, twost five thirds of the products continued to be remanufactured in our factory, but we do supplement them with chinese products. We just cannot compete. Chinabased Companies Control 80 of all aftermarket cartridges, the technology barrier. Is those Chip Companies in china do things that are against the law in the United States. Chinabased companies are the largest producers of aftermarket cartridges and chips in the world. Our. Manufacturing local manufacturing has never wavered. We were frustrated with chinas chokehold on the industry but continue to produce while also buying products in china. Late january,eturning from a sourcing trip we witnessed firsthand the beginning of the covid pandemic which inspired us to begin manufacturing ppe supplies. Ofhad hundreds of millions plastic objects. Of the ppefound most products came from china. The first product we launched in our factory was hand sanitizer. We used much of our equipment here to bottle this in kansas. Buyound we would need to materials from china once again. The u. S. Has no small bottle manufacturing companies. Continue to create opportunities for manufacturing with theare engaged production and bottling of a safe surface disinfectant known as hlcl. 80 times more powerful than bleach against viruses and all the pandemic bugs out there including covid19. We are partnered with another kansas company, using our operations background in making preparations to produce and hlcl in our factory. Our goal is to grow the company and make more production jobs. We are still facing pressure from china with production still located in china. They are smart and ambitious people. One cannot blame them for taking advantage of the political realities. It has been my experience and observation from spending time in china the Top Manufacturing companies are supported by the government. Supports to bring manufacturing to the u. S. It will require policy from u. S. From washington. We welcome further discussions about how to bring manufacturing back to the u. S. Our team consists of experienced manufacturing and labor. We would love to be of service however we can. Thank you for your time. Thank you for your passion for what you do and for kansas. Stovall is the chief executive offer of officer of Kansas Manufacturing Solutions. You are recognized for five minutes. Good afternoon, chairman moran and members of the subcommittee. Thank you for this opportunity to appear before you to discuss the manufacturing for the covid19 pandemic. We are the epicenter for kansas. The manufacturing extension partnership. We are the nations only Program Providing handson direct support to small and mediumsized manufacturing to help them compete more effectively in the Global Market space. We have a center in every state plus puerto rico. We have 1500 manufacturing experts on staff and nearly 2103rd Party Service providers 2100 thirds Service Providers and partners. It is because of this history that Kansas Manufacturing Solutions is uniquely positioned to help support u. S. In the exceptional challenge that was presented during the covid19 pandemic. Manufacturers have had to respond to covid19 challenges within their own facilities, but they are also helping our nation withgh the pandemic personal protective equipment, theilators, essential to Public Health efforts. Manufacturers are shifting their capabilities to meet u. S. Need. Stories we have heard are similar to what is happening across kansas and the United States. Manufacturers across the country had to close their doors. Customers could not buy from them. Threats. D mortal kms and the National Network have been here for them. Manufacturing continues toward economic recovery. The temporary costsharing has provided muchneeded services to manufacturers during unprecedented times. Months, caresal act funding and costsharing help them retool, modify processes and procedures, and adapt to new health and safety protocols. Many remain working remotely to. Rotect staff they are trying to protect their own stuff as well. Congress, for the temporary costsharing. Issues have been heightened because of the pandemic. Organizations are squandering to materials and ppe. Worked aroundtheclock in the early days, matching companies to suppliers. Databasesupply chain particularly around ppe as we went. Statebystate, through our National Supplier system. Disinfectant, henson ties hers, hand sanitizers, other products. These had previously been sourced overseas. Delivered to client along with medical centers. We were able to quickly match not with a manufacturer only in the United States but in house. Able to keep this supply chain going. We have heard from rick about the issues hes battling. That is another thing across the that have expanded their capabilities as manufacturers. Workplace safety is a huge concern for manufacturers. It is heightened during the covid pandemic. Workforceof the u. S. Could shift to remote work. Manufacturers could not. To help manufacturers understand safety protocols in facilities and beyond, and helping manufacturers respond to covid19, helping them build resiliency. Manufacturers are driving economic recovery while also facing uncertainty themselves. The goal of the entire National Network is to help get manufacturers back on their feet, to deliver tools to them asaddress the uncertainty the country continues to get back on its feet by providing critical equipment. Supply to the manufacturers of the United States. There is so much economic uncertainty. E really have worked hard one of the services developed by manufacturerselp look forward throughout the pandemic. Consultancy,tra manufacturing assessment, in a strategic way to ensure the facilities as well as the future for their employees. I hope what i have shared today has given some insight on how kms has responded to unprecedented conditions for the United States and how the has respondedrk across the United States. Together we are partnering with certainlyers and i appreciate the opportunity to appear before the subcommittee today. Thank you. We appreciate your testimony, your willingness to appear. Our final witnesses mr. Michael was so. Wessell. Ell Ranking Member blumenthal, members of the subcommittee, thank you for the opportunity to appear. And ie is Michael Wessel am appearing as a commissioner on the u. S. China Economic Security review commission. I am only speaking for myself. The stress on supply chains and , theanufacturing base availability of Public Resources , and policy responses. We need to address todays needs and prepare for a future pandemic. By manufacturers wanting to contribute to the crisis. Match withasier to state and Hospital Systems to the their needs including hospital in senator blumenthals home. Our nation owes a debt of gratitude to our manufacturers and workforce who have come to the aid of our country to meet the critical needs of our health care workers, first responders, we all entire population know well supplies are so available, there are still shortages. America must do better to help them protect our citizens. The Chinese Communist partys industrial policies and our shortsightedness have led to a dangerous reliance on china for pharmaceuticals, active ingredients, medical devices and. Quipment including ppe the impact of the coronavirus was unexpected. Our increasing dependency on china is not news. Theiris willing to use manufacturing power. The ccp leadership was willing mask diplomacy by using shipments of ppe to foster diplomatic gains. The ccp has been willing to rep a nice weaponize supply chains. You cannot allow health and safety to be held hostage to economic, or military confrontation. We no longer have the capacity in the u. S. To make penicillin and are completely dependent on foreign sources. Apis we use come from abroad, a substantial proportion coming from china. Remdesivirent in comes from china. Products we are partially or entirely dependent on china. That,ficial testified quote, the National Security ks of increased dominance chinese dominance on the global api market cannot be overstated. ,ince china joined the wto operations have expanded dramatically. Chinas policies were designed to promote that. What is troubling is the expansion of r d. National firms increased r d spending in china at nearly twice the rate of domestic spending. China d expenditures in on the chemicals including Pharmaceuticals Surge between 2000 and 2017. Chinese state directed and controlled entities have engaged in the u. S. With many focused on the health or health care sector. Actors in china have used illegal means to obtain the health data of u. S. Citizens that may allow their firms to dominate the increasingly important biosynthetic sector. The focus today is on medical supplies, but our dependence on china for many products, some of them critical, is broad and deep. Areas, this reduces our potential resilience. We should examine supply chain risks and determine the potential impact on our national and state Economic Security. Again, thank you for the opportunity to testify today. Making sure we never face these challenges again. Wessel, thank you. You speak for yourself and not the commission, but i understand that in a short period of time there will be a first of all i agree with your assessment that china is predatory and protectionist in economic policy, undermining u. S. Economic health and National Security interests. I appreciate you saying that and i agree with you. Your commission is expected to release this years report in the next few weeks. Can you describe any formal recommendations you would expect to be included in terms of assessing and improving production either in the united producing medical supplies or even pharmaceuticals . What do you expect them to be . Thank you for your question. Fact we haveout in already a public report on this matter. Missourir senator of and i cochaired a hearing on this in 2019. Six democrats and six republicans released this report. We are unanimous behind a number of recommendations regarding this sector. Review those if i could. Ability to dive deep as you are doing today. We have all been forced to as we look to address this pandemic, we can harness procurement policy through medicare, medicaid, veterans affairs, to buy american products, to use our existing authorities and leverage those to bring supply chains back to the u. S. Second, we have to do a better protectingng the fda americans in terms of their safety for these products. Products that caused a number of deaths in the u. S. Coming from china. Found a bloodwe pressure medicine was actually tainted with rocket fuel because both the apis and the rocket fuel were being produced at the same facility. That product made its way to u. S. Consumers. To a should be allowed a company in china sending products to the u. S. We need to make sure that happens, those products are unable to come here. , we need to disclose where essential drugs and products are coming from. We can do that through federal procurement standards so that nowizens and officials k where the products are coming from and how we can best prepare and protect. Much foryou very explaining that to me. , your companies have worked to create ppe Manufacturing Capabilities in the u. S. In resp

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