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Originally Posted by blue3golf
From the way I understand it the flag is "backwards" to represent what it would look like moving forward as if it was actually a guidon
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Basically what he said.
As an aside, normally the flag patch is not worn on the uniform, excepting in contingencies or war scenario's where you'd need to be able to identify yourself as a US troop from a distance. (Multinational JTF or whatever).
Generally speaking, the observer's left is the place of honor, and is usually how the flag is displayed in 99% of all flag displays. If the flag were on his left sleeve you'd see the Union blue field of the flag on the left side instead.