When even Old Glory is made in China

Thirteen stripes, 50 stars, and a tiny, often unnoticed label: Made in China.

Thank heavens Betsy Ross isn't here to see it.

More than 200 years ago, the Philadelphia seamstress helped create the first American flag. Legend says she impressed Gen. George Washington by fashioning a five-pointed star with a single snip of her scissors.

Today Old Glory, like most products, has gone global. And as the flag-waving season gets under way, consumers might expect some discussion about country of origin.

Rest assured, the vast majority of American flags are still made in the good old USA. But after Sept. 11, 2001, when feelings of patriotism caused demand for flags to skyrocket, foreign manufacturers saw opportunity. Appealing to price-conscious shoppers, they outfitted thousands with hand-held flags.

The United States imported $7.9 million worth of American flags in 2002, according to the Census Bureau. Some of those flags have left consumers baffled.

"We've actually gotten questions from people who had 53-star flags ... and they wondered if there was a special significance to that," says Joyce Doody, director of membership services at the National Flag Foundation, a patriotic education association in Pittsburgh. "We presume that they were made in another country."

Most imported flags come from China - about $5 million worth last year - but Taiwan and Korea have also made hundreds of thousands in recent years, according to data from the US Department of Commerce, the US Treasury, and the US International Trade Commission.

Shanghai Flag & Tent Works, for example, exported about $1 million worth of merchandise to the United States last year, with American flags accounting for about 80 percent of the total, says Zheng Banglin, general manager for the firm, which claims to control about one-third of the Chinese-made flag market in the US.

That's not a huge amount considering American companies already turn out more than 100 million flags of all types each year. Probably less than 5 percent of American flags sold are made overseas, says Tibor Egervary, director of sales and marketing for the Valley Forge Flag Co., in Womelsdorf, Pa. The company is one of the top providers of flag products to the US government.

Yet Chinese-made American flags account for about 20 percent of American flags sold at the United States Flag Store, says Kevin Hickey, vice president of marketing for its parent company, Online Stores Inc. The United States Flag Store (www.united-states-flag.com) does about $5 million worth of business annually.

The company sells thousands of the small, vinyl flags so ubiquitous at parades and on cars. Nearly all are made overseas: The Chinese do a better job with small flags, Mr. Hickey says, while those made in America tend to fall apart.

Yet at Valley Forge, larger flags are what really matter - not those meant to last only a day or two. "That's not a flag product," Mr. Egervary says. "That's a toy or an entertainment product."

Until recently, the most American flags ever imported in a single year was about 2.5 million, according to government data.

Then came the terrorist attacks of Sept. 11. For all of 2001, nearly 113 million American flags, worth nearly $52 million, were imported. US manufacturers lacked the materials or machines to keep up with demand, and the wait for an American-made flag was often several months.

Since then imports have tapered off drastically. But they haven't disappeared completely, in part because foreign-made flags are considerably cheaper. At united-states-flag.com, a foreign-made, 4-by-6-foot nylon flag sells for $18.95. Its American-made counterpart is priced at $27.50. Overall, says Hickey, foreign-made flags are about 30 percent cheaper.

THAT'S good news for individuals and institutions who are both patriotic and penny-pinching, Hickey says. But for those willing to spend a little more, he adds, the reward is a higher-quality flag that's more than another swath of cloth.

The American flag is a "cultural icon," says Egervary.

Making Old Glory in a foreign country is like sculpting a fifth head for Mount Rushmore overseas and then bolting it to the South Dakota landmark, Hickey says. "Many retailers, and particularly online folks, they treat the flag like any other product...." he says. "Our intention, however, is to indicate that the flag is not just a $7.99 [Web-] traffic-builder that's a piece of junk."

Still, China is fast improving its technology, and with lower labor costs, foreign-made flags will probably remain less expensive than US-made ones. Within a few years, buying American for any reason other than national pride "will be increasingly hard to justify," Hickey says.

While maintaining confidence in their product, companies like Valley Forge recognize the threat of globalization to American manufacturers.

"I wouldn't be so pompous as to say that we don't worry about it," says Egervary, pointing to the recent formation of the Flag Manufacturers Association of America.

Formed just a few weeks ago, the association aims to advance the industry by setting manufacturing standards, FMAA president Robert Waller Jr. states in an e-mail. "These steps, in turn, will educate consumers about the quality, variety, and value of a domestically manufactured United States flag."

In addition to developing a sort of "seal of approval," FMAA aims to ensure that all flags have a prominently located "Made in" label, Egervary says, adding that, if provided with adequate information, people "will make the right choice."

• Li Yan in Beijing contributed to this report.