KANSAS CITY, Mo. – Call it a condom conundrum.

At a time when the federal government is spending billions of stimulus dollars to stem the tide of U.S. layoffs, should that same government put even more Americans out of work by buying cheaper foreign products?

In this case, Chinese condoms.

That’s the dilemma for the folks at the U.S. Agency for International Development, which has distributed an estimated 10 billion U.S.-made AIDS-preventing condoms in poor countries around the world.

But not anymore.

In a move expected to cost 300 American jobs, the government is switching to cheaper off-shore condoms, including some made in China.

The switch comes despite implied assurances over the years that the agency would continue to buy American whenever possible.

‘Buy American’

“Of course, we considered how many U.S. jobs would be affected by this move,” said a USAID official who spoke on the condition that he would not be named. But he said the reasons for the change included lower prices (2 cents versus more than 5 cents for U.S.-made condoms) and the fact that Congress dropped “buy American language” in a recent appropriations bill.

Besides, he said, the sole U.S. supplier – an Alabama company called Alatech – had previous delivery problems under the program.

It’s clear that Alatech’s problems over the years, which apparently have been resolved, may have driven U.S. officials to seek much less expensive foreign-made condoms in the first place.

But that’s cold comfort to Fannie Thomas, who has been making condoms in southeastern Alabama for nearly 40 years in the small town of Eufaula.

“We pay taxes down here, too, and with all this stimulus money going to save jobs, it seems to me like they (the U.S. government) should share this contract so they can save jobs here in America,” Thomas said.

Thomas and others at the Alatech plant said there aren’t many alternatives for them if it closes down, which is a likely result of the contracting switch.

New contracts

In fact, the government is close to accepting condoms from two offshore companies: Unidus Corp., which makes condoms in South Korea, and Qingdao Double Butterfly Group, which makes them in China.

Condoms from those companies will likely carry the USAID logo – two hands shaking over red and white bunting.

Instead of dealing directly with condom makers, as it had done in the past, the government hired a Massachusetts company to act as a middleman. That in turn protected the government from a successful bid protest, because USAID was no longer the “prime contractor.”

Larry Povlacs, Alatech’s president, says he thinks that was a deliberate move by USAID to follow through with what he says it wanted to do all along – cut Alatech out of the bidding. USAID officials deny that, saying the middleman was hired for other reasons.

Now the company is turning to other methods, including pleading its case in Washington, and possibly a lawsuit that would attempt to enforce buy-American provisions and past promises.

Quality issues

Alatech officials and others, however, maintain there is more than just American jobs at stake. There is a health and quality issue, too.

The problems with Chinese products – including pet food, toys, toothpaste, drywall and more – have increased to the point where many consumers are now wary of the ubiquitous “made in China” label.

So why should condoms be any different? USAID officials maintain that tests have shown that Chinese condoms hold up well against those made in the U.S. and elsewhere.

Some condom experts disagree.

Bill Howe, president of PolyTech Synergies in Ohio, a consultant to the condom industry, said China is “learning” to produce better condoms, but their products are still “notoriously suspect.”

Howe, who has consulted for Alatech, acknowledges that the company got a “sweet deal” for years as the only supplier to the U.S. government for international condom distribution. Nonetheless, “they have a high level of integrity, and you don’t get that in China,” he said.


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