New Balance is a big winner in new defense bill

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Maine-made New Balance shoes are likely to see additional sales to the military thanks to the inclusion of an American-made requirement in a $619 billion defense bill approved by the U.S. Senate on Thursday.

The long-awaited and hard-fought passage of this measure is a landmark victory for American shoe manufacturers, like New Balance, who will finally have the opportunity to compete to provide entry-level recruits with high-quality, American-made athletic shoes,” U.S. Sen. Angus King of Maine said in a prepared statement.

The congressional mandate is likely to mean the sale of tens of thousands of additional New Balance shoes annually, but it may also wind up causing injuries to new military recruits who would no longer have much choice about the athletic shoes they wear.

Taking away most of the shoe options available now, the Defense Department said in a July memorandum “may contribute to a higher incidence of injury among new recruits during one of the most critical times in a member’s military training.”

Every year, most of the more than 200,000 recruits entering the U.S. military are given vouchers they can use to buy athletic shoes for basic training and keeping in shape. The program costs about $17 million annually.

Assuming President Barack Obama signs the National Defense Authorization Act as expected, that voucher program will end thanks to an intensive push by lawmakers who want American-made shoes provided to the men and women who don uniforms.

Since Boston-based New Balance is the only company poised to take immediate advantage of the revision, the policy shift will likely boost the fortunes of the footwear manufacturer and its three factories in Maine, including one in Norway.

The defense bill, a whopping catch-all of military-related spending approved by the House last week, also includes key funding for ship construction at Bath Iron Works and other provisions that will see more spending in Maine.

U.S. Sen. Susan Collins, Maine’s senior senator, said the bill is “vital to ensuring that our military has the critical resources and equipment necessary to accomplish national security missions around the world and meet the ever-expanding threats facing our nation.”

By securing the shoe mandate in the measure, “Congress and the Pentagon will finally prioritize and reward U.S. companies for creating and maintaining good-paying jobs here in the U.S. and will equip American troops with high-quality American-made athletic footwear,” a joint statement by King, Collins and U.S. Rep. Bruce Poliquin said recently.

It is the culmination of at least a five-year effort by New Balance and its legislative allies to force the military to buy American-made athletic shoes. At one point in 2012, the company presented Obama with a specially made presidential pair as part of its lobbying push.

It appeared two years ago that the shoe mandate would take effect without special legislation, but the military didn’t ultimately follow through on the change that former Rep. Mike Michaud of Maine and others had pushed it to accept.

So Maine’s delegation joined forces with other lawmakers with an interest in the issue, particularly U.S. Rep. Nikki Tsongas of Massachusetts, and pressed for the revision’s inclusion in the defense bill.

The Made-in-USA section for shoe purchases survived a House bid in June to leave the existing system in place. Its main proponent, U.S. Rep. Terry Sanford of South Carolina, said the change would reduce the options for recruits from about 13 now down to one or maybe two, if the Massachusetts-based Saucony successfully breaks into the market.

“For the average recruit out there, when there are very, very few choices, there is a wisdom to having more choices based on the notion of one size never fitting all,” Sanford said on the House floor. He pointed out the possibility of more training injuries as a consequence.

But Poliquin helped convince a majority of his colleagues to side with New Balance.

“I represent 900 of the most skilled, hardworking athletic shoemakers in the world. They are proud and they are honored to manufacture the highest quality athletic shoes for our troops,” Poliquin said.

The 2nd District congressman called support for Sanford’s position “a vote for manufacturing jobs in Asia” and urged lawmakers “to support U.S. manufacturing jobs, to save taxpayer dollars, and to reduce injuries by providing the highest quality, 100 percent American-made athletic shoes made for U.S. recruits.”

In a March 8 letter to the House Armed Services Committee, Poliquin said that wearing high-quality shoes from New Balance would reduce training injuries that are sometimes caused by “lower quality minimalist running shoes” that recruits often choose.

Supporters said they’re not worried about reduced competition because other firms are free to jump into the market along with New Balance.

The president of New Balance, Rob DeMartini, said recently that his firm “is proud to be the only major company that still makes athletic footwear in the United States.”

He said the company was grateful that legislators insisted the military include athletic shoes under a 1941 law mandating American manufacture of military uniforms. Whether shoes are part of a uniform has been one issue that legislators debated.

New Balance already has a lock on shoe sales to the U.S. Navy, which has been purchasing them since 2005, along with the Coast Guard and some smaller law enforcement agencies of the government.

The change included in the defense bill, though, would extend the requirement to the Army, Air Force and Marines that provide far more personnel.

The federal Office of Policy and Management said last May that the provision “essentially serves as preferential arrangement for a particular company,” the unnamed New Balance.

“Mandating that a specific article of clothing be provided to new recruits is unprecedented and, in the case of athletic shoes, runs counter to research that indicates a strong correlation between the variety of athletic shoes available, fit, and comfort, and reduced injury rates,” it said in a memo about the bill.

“Forcing DOD into a ‘one size fits all’ approach to athletic footwear may contribute to a higher incidence of injury to new recruits during one of the most critical times in a member’s military training,” it said.

While there are studies that indicate more footwear choices appear to reduce injuries, the evidence isn’t overwhelming.

The Navy, for example, studied the issue in 2009 after using New Balance shoes for four years and found that stress fractures were down by 70 percent, according to a story in Stars and Stripes. But it had simultaneously taken other injury prevention initiatives so it’s impossible to say how much the shoes mattered.

U.S. Rep. Martha McSally, an Arizona Republican and retired U.S. Air Force colonel, said she’s confident the new policy will give the Pentagon the opportunity to measure recruits’ feet and gait “and then provide them with shoes that are appropriate for them.”

“This is about readiness and avoiding injury,” she said. “We need our troops to start off on the right foot and with the right footwear.”

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