Building Supply Chains of Freedom

America should never be dependent upon adversaries for critical goods and services. That’s why America needs to build the supply chains of freedom.

When state and local governments make purchases, they should source products and services from free nations. Not only does this set a positive example for the private sector, but it also protects state security and grows an economy that fosters free-nation vendors.

The coronavirus pandemic provided a harsh lesson on the cost of reliance on adversaries like China. First, China’s government concealed information about the emerging pandemic and cut off medical supplies to American buyers. Then, China’s government mouthpieces even went so far as to threaten to cut off America’s supply of antibiotics if Americans kept demanding an investigation into the origins of the coronavirus.

American national security is at risk when we rely upon critical products from adversaries. Companies from adversarial nations and companies sanctioned by the U.S. should have no place in state procurement processes – either directly or through third-party vendors. States should immediately tighten vendor requirements for public procurement, especially for sensitive products like computers.

States and local governments should be prohibited from procuring technologies produced by foreign adversaries, companies that have business-to-business relationships with sanctioned companies, or any entity that seeks to do Americans harm. Immediate replacement of such products should be required for particularly sensitive areas like drones, telecommunications and radar equipment, port crane software, genetic sequencing devices, and laser surveillance technologies. Vendors that have recently contracted with the People’s Liberation Army, the Chinese Communist Party, or other associated entities should be prohibited from bidding on state and local procurement contracts.

State and local pensions also have tremendous purchasing power. When investing outside of American borders, public pension plan international investments should flow into trusted Allies and partners, not foreign adversaries.

States should build a competitive tax regime that incentivizes reshoring critical supply chains while preventing State economic benefits from flowing to companies from adversary nations. While states should enact full expensing for new capital investments, any company owned or operated by an adversary should be barred from benefiting from any state or local tax credit or other financial or economic incentive program.

States can play a crucial role in building the supply chains of freedom which will in turn provide greater security and prosperity for states.