World

New Balance Slams Obama Administration And TPP

| by Robert Fowler
New Balance manufacturing plant in the U.S.New Balance manufacturing plant in the U.S.

After remaining neutral throughout 2015, sneaker manufacturer New Balance has slammed the long-debated Trans-Pacific Partnership (TPP). On April 12, the company accused the Obama administration of making false promises of a military contract bid in exchange for their silence on the trade deal.

New Balance CEO Rob DeMartini has opposed TPP for years but is now vocally voicing his displeasure with the trade pact, alleging that his company had been taken for a ride by the Obama administration.

The sneaker manufacturer took issue with how TPP would phase out tariffs on Vietnamese-made shoes, citing competition from the Pan Pacific nation as a threat to its factory operation in New England.

While the majority of New Balance shoes are made overseas, it is the only major sneaker manufacturer that creates a portion of its product in the U.S., employing 4,000 Americans, according to MassLive.

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An official from the Obama administration allegedly asked the athletic shoe company to keep their concerns over TPP to themselves in exchange for tweaking the Berry Amendment, legislation from the 1940s that mandates the U.S. military purchase equipment from domestic manufacturers. However, athletic shoes have been exempt from this law for many years because there are not as many domestic shoe options.

"The law is that our troops are supposed to be outfitted in American-made products whether it’s shoes, belts, pants, socks or shoes," Independent Sen. Angus King of Maine said, according to WCSH6. “For some reason, everything is American-made except sneakers.”

New Balance is now accusing the Obama administration of promising them a shot at supplying U.S. troops with athletic footwear, a deal that could have generated $25 million for the company.

"There was no quid pro quo deal," DeMartini said at a press conference on April 12, according to MassLive. "We didn’t want an earmark contract. We wanted to compete for a piece of business we’re very confident we can win."

The U.S. Department of Defense conducted tests on New Balance footwear throughout 2015, but the company has lost its patience.

"We swallowed the poison pill that is TPP so we could have a chance to bid on these contracts," Matt LeBretton, the company’s vice president of public affairs, told The Boston Globe. "We were assured this would be a top-down approach at the Department of Defense if we agreed to either support or remain neutral on TPP."

LeBretton added that "the chances of Department of Defense buying shoes that are made in the USA are slim to none while Obama is president."

According to the Department of Defense,, none of the three varieties of New Balance shoes met their quality and cost standards.

Footwear Distributors and Retailers of America (FDRA), a U.S. shoe trade association, does support TPP and has issued a statement chastising New Balance.

"We are disappointed at New Balance’s change of heart on this vitally important agreement for the entire U.S. footwear industry over a matter unrelated to TPP," FDRA president Matt Priest said, MassLive reports.

Sources: The Boston Globe, MassLiveWCSH6 / Photo Credit: Aram Boghosian/The Boston Globe

Is New Balance justified in slamming both TPP and the Obama administration?
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