Stimulus Flop? Condoms Outsourced

condoms.thumbnail.jpgOver 300 jobs are at risk at Alatech Healthcare Products, the Alabama plant that manufacturers a majority of the condoms used by the U.S. Agency for International Development for its AIDS prevention programs in poor countries. Alatech’s condoms cost 5 cents each, foreign made 2 cents.

USAID will now be outsourcing all their jimmy hat purchases to overseas to South Korea, Malaysia and China, citing delivery problems from Alatech under the program, along with complaints from the field–and the fact that Congress dropped "buy American language" in a recent appropriations bill.

Lawrence Povlacs, CEO and President of Alatech, said the agency’s decision contradicts the federal stimulus package designed to create jobs in the United States.  Alatech, which employs

women, some the children of sharecroppers and textile factory workers, many of them struggling to support families on $7 to $8 an hour…single mothers and older women with scant education,

is the only condom manufacturer in the U.S. Their only rival, also a USAID supplier, went bankrupt in 2005, and Alatech bought their plant, secure that their US senators Jeff Sessions and Richard Shelby would help them out--which they did until this year.

 Jay Thomas, the mayor of Eufaula–the town where where Alatech, which only makes condoms, is located–said:

If we’re trying to keep jobs in the U.S. with this stimulus, it would make sense to do the manufacturing here and just pay the difference.

In 2007 USAID ordered 201 million condoms from Alatech, about half the previous year’s order and another 100 million from South Korea.

In related economic news, CNN reports a rise in vasectomies. And why oh why are tubal ligations not covered by insurance? One would think that given the cost of pre-natal care and of insuring a child after birth, insurance companies would gladly offset some of the cost of having tubes tied…

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