[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1514 Introduced in Senate (IS)]







105th CONGRESS
  1st Session
                                S. 1514

  To assess the impact of NAFTA, require the renegotiation of certain 
 provisions of NAFTA, and provide for the withdrawal from NAFTA unless 
                      certain conditions are met.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           November 10, 1997

  Mr. Dorgan (for himself, Mr. Byrd, Mr. Campbell, Mr. Hollings, Mr. 
 Inouye, Mr. Wellstone, and Ms. Snowe) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
  To assess the impact of NAFTA, require the renegotiation of certain 
 provisions of NAFTA, and provide for the withdrawal from NAFTA unless 
                      certain conditions are met.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``NAFTA Accountability Act''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) Expanded markets.--One of the purposes of NAFTA, as 
        stated in its preamble, is to ``create an expanded and secure 
        market'' for United States goods and services. Instead, NAFTA 
        has resulted in an enormous increase in imports to the United 
        States from Mexico and Canada and a spiraling trade deficit 
        with Mexico and Canada that has exceeded $30,000,000,000 in 
        both 1995 and 1996. Before NAFTA, the United States had a 
        $1,700,000,000 trade surplus with Mexico. Rather than 
        harmonious development and expansion in all 3 NAFTA countries 
        as envisioned, NAFTA has resulted in United States trade 
        deficits which are draining $2,500,000,000 a month from the 
        United States economy and causing greater economic instability 
        in Mexico.
            (2) Currency stability.--One of the purposes of NAFTA, as 
        stated in its preamble, is to ``ensure a predictable commercial 
        framework for business planning and investment''. However, 
        NAFTA contains no safeguards to minimize the negative economic 
        impacts of severe shifts in currency exchange rates among the 
        NAFTA Parties. Mexico's sudden devaluation of its peso in 
        December 1994 has more than offset tariff reductions and other 
        trade benefits the United States expected to achieve from the 
        agreement. The dollar-peso exchange rate when NAFTA passed was 
        1:3.5. It is now approximately 1:8 and is not expected to 
        return to its previous value. Indeed, economic experts are 
        stating that conditions are building for another severe Mexican 
        currency crisis.
            (3) Jobs, wages, and living standards.--One of the purposes 
        of NAFTA, as stated in its preamble, is to ``create new 
        employment opportunities and improve working conditions and 
        living standards'' in the respective territories of the NAFTA 
        Parties. Instead, there has been a substantial loss of a half 
        million high paying jobs in the United States. A survey of 
        United States companies conducted 3 years after the 
        implementation of NAFTA found that 90 percent of the companies 
        that had anticipated creating United States jobs through NAFTA 
        have, in fact, not created jobs because of NAFTA. In the first 
        3 years of NAFTA's implementation, United States workers have 
        seen steady drops in real hourly wages. In Mexico employment in 
        the border Maquiladora zone has increased by more than 46 
        percent under NAFTA. However, Mexico has seen much greater job 
        losses in the agricultural, small retail, and small industrial 
        sectors. Thus, more than 2,000,000 workers have become 
        unemployed in Mexico since the implementation of NAFTA, and 
        real wages of Mexican workers have been slashed 50 percent.
            (4) Manufacturing base.--One of the purposes of NAFTA is to 
        enhance the competitiveness of firms in the global market. 
        However, rather than increase the ability of the manufacturing 
        sector in the United States to compete in the world market, 
        NAFTA has facilitated the movement of United States 
        manufacturing facilities and jobs to Mexico. NAFTA has 
        contributed to a net loss of approximately 400,000 
        manufacturing jobs in the United States and an unprecedented 
        flood of imports of manufactured goods into the United States.
            (5) Health and environment.--Other purposes of NAFTA, as 
        stated in its preamble, are ``to safeguard the public welfare'' 
        and ``to strengthen the development and enforcement of 
        environmental laws and regulations''. Yet, since the 
        implementation of NAFTA, the public welfare has been undermined 
        by increased imports of food products that do not meet United 
        States health standards. In addition, NAFTA has accelerated the 
        relocation of United States manufacturing facilities to the 
        United States-Mexico border zone. Without adequate 
        environmental safeguards, the uncontrolled industrial and 
        population growth in the border zone has aggravated pollution 
        and health hazards, increasing the incidence of infectious 
        diseases and human exposure to toxins.
            (6) Illegal drugs.--Rather than safeguarding the public 
        welfare, NAFTA has allowed the increased flow of illegal drugs 
        and controlled substances into the United States from Mexico. 
        More than half of all marijuana and 70 percent of cocaine 
        entering the United States now comes through Mexico. NAFTA's 
        rules limit inspection of trucks crossing the border into the 
        United States, and the major increase of Mexico to United 
        States truck traffic has provided a new route for drug 
        smuggling. The General Accounting Office has reported that 
        interdiction efforts have had little, if any, impact on the 
        overall flow of drugs through Mexico into the United States.
            (7) Protect rights.--The promotion of sustainable 
        development as well as the protection and enhancement of basic 
        rights are stated objectives of NAFTA. As envisioned, NAFTA was 
        to increase economic opportunity together with expansion of 
        political freedoms and human rights. Yet these objectives are 
        not being fulfilled, especially in Mexico, where many citizens 
continue to experience infringements of such rights and freedoms.
            (8) Fair agricultural trade.--One of the purposes of NAFTA, 
        as stated in its preamble, is to ``reduce distortions to 
        trade''. In addition, NAFTA is supposed to promote conditions 
        of fair competition and to establish mutually advantageous 
        rules governing trade. However, since NAFTA, there have been 
        sharp drops and escalations of one-way agricultural trade. One-
        way trade of Canadian grain exports of wheat, durum wheat, and 
        barley to the United States has disrupted markets and marketing 
        channels. Surges in the importation of certain Mexican fruits 
        and vegetables have damaged United States domestic production. 
        The importation of livestock and meat products from the NAFTA 
        Parties raises serious health concerns and has exacerbated the 
        severe problems facing United States livestock producers. 
        NAFTA's destabilization of the Mexican small agricultural 
        sector has undermined the country's ability to ensure a stable 
        supply of food, which has led to an unprecedented migration of 
        landless peasants and an increase in emigration to Mexican 
        cities and to the United States.
            (9) Highway safety.--NAFTA is intended to preserve the 
        flexibility of each nation to safeguard its public welfare. 
        Mexican motor carriers and drivers do not have to meet the more 
        stringent United States safety standards when operating in 
        Mexico. Canadian law allows significantly longer and heavier 
        trucks than permitted by United States law. These fundamental 
        differences in safety standards make it practically impossible 
        to develop effective enforcement programs in the United States 
        to bring all Mexican or Canadian motor carriers and drivers 
        into compliance with United States laws. Yet, NAFTA would allow 
        Mexican and Canadian trucks to operate in United States border 
        States and eventually all States, posing a serious threat to 
        highway safety in the United States.
            (10) NAFTA should not be expanded.--Congress approved NAFTA 
        in order to achieve economic, social, and environmental 
        benefits for the people of the United States. Based on 
        currently available information, the goals and objectives of 
        NAFTA are not being achieved. Therefore, until the 
        certifications of NAFTA's effect, required in section 3, are 
        made, NAFTA should not be expanded to include any other 
        country. It is also inappropriate, prior to the certification 
        of NAFTA's effects, to consider any request for ``fast track'' 
        negotiating authority to expand NAFTA.

SEC. 3. CONDITIONS FOR CONTINUED PARTICIPATION IN NAFTA.

    (a) In General.--
            (1) Withdrawal of approval.--Notwithstanding any other 
        provision of law, unless each of the conditions described in 
        paragraph (2) is met--
                    (A) the approval of NAFTA by Congress provided for 
                in section 101(a) of the North American Free Trade 
                Agreement Implementation Act shall cease to be 
                effective on January 1, 1999; and
                    (B) not later than July 1, 1998, the President 
                shall provide 6 months written notice of withdrawal to 
                the Governments of Canada and Mexico in accordance with 
                Article 2205 of NAFTA.
            (2) Conditions for continuing participation in nafta.--The 
        conditions described in this paragraph are that before March 
        31, 1998--
                    (A) the President--
                            (i) provide the certification to Congress 
                        described in subsection (b)(6); and
                            (ii) renegotiate the terms of NAFTA in 
                        accordance with section 4;
                    (B) the Secretary of Commerce provide the 
                certification described in subsection (b)(1);
                    (C) the Secretary of the Treasury provide the 
                certification described in subsection (b)(2);
                    (D) the Secretary of Labor provide the 
                certification described in subsection (b)(3);
                    (E) the Secretary of Agriculture and the 
                Administrator of the Food and Drug Administration 
                provide the certification described in subsection 
                (b)(4)(A);
                    (F) the Administrator of the Environmental 
                Protection Agency submit the certification and report 
                described in subsection (b)(4)(B);
                    (G) the Attorney General of the United States 
                provide the certification described in subsection 
                (b)(5);
                    (H) the Secretary of Agriculture provide the 
                certification described in subsection (b)(7); and
                    (I) the Secretary of Transportation provide the 
                certification described in subsection (b)(8).
    (b) Areas of Certification.--The areas of certification described 
in this subsection are as follows:
            (1) Certification of the nafta balance of trade.--If the 
        Secretary of Commerce, after consulting with appropriate 
        government agencies and citizen organizations, determines that 
        the cumulative trade balance between the United States and 
        Mexico and the United States and Canada during the first 3 
        years that NAFTA was in effect is at least as positive as in 
        the 3 years before NAFTA took effect, so that the net trade 
        balance does not show a greater overall deficit, the Secretary 
        shall so certify.
            (2) Certification of currency values.--If the Secretary of 
        the Treasury, after consulting with appropriate government 
        agencies and citizen organizations, determines that the 
        exchange rates between the United States dollar and both the 
        Canadian dollar and the Mexican peso are within 10 percent of 
        the exchange rates when NAFTA took effect, the Secretary shall 
        so certify.
            (3) Certification of nafta's effects on united states jobs 
        and living standards.--If the Secretary of Labor, after 
        consultation with appropriate government agencies and citizen 
        organizations, determines that--
                    (A) the number of specific United States jobs 
                resulting from increased exports of United States 
                manufactured goods to other NAFTA Parties exceeds the 
                number of specific jobs lost because of imports of 
                manufactured goods from other NAFTA Parties since 
                January 1, 1994, by comparing jobs created with jobs 
                lost, and
                    (B) the hourly real wage rate of wage earners in 
                the United States has not decreased since January 1, 
                1994,
        the Secretary shall so certify to Congress.
            (4) Certification relating to health and environmental 
        standards.--
                    (A) In general.--If the Secretary of Agriculture 
                and the Administrator of the Food and Drug 
                Administration, after consultation with appropriate 
                government agencies and citizen organizations, 
                determine, with respect to imports from NAFTA Parties, 
                that since January 1, 1994, there has been a reduced 
                incidence of contaminated and adulterated food, food 
                containing additives or pesticide residues exceeding 
                United States standards, or food containing additives 
                or pesticide residues which cannot be legally used in 
                the United States, the Secretary and Administrator 
                shall so certify to Congress. In making this 
                determination, all foods and food products, including 
                fruits, vegetables, grains, oilseeds, and meats, both 
                fresh and processed, shall be reviewed. Special 
                attention shall be given to foods which have had a 
                history of violations of United States standards or 
                laws described in this subparagraph.
                    (B) Border area pollution.--(i) If the 
                Administrator of the Environmental Protection Agency 
                determines, taking into account the matters required to 
                be included in the report under clause (ii), that 
                conditions affecting public health and the environment 
                in the United States-Mexico border zone have not 
                worsened since January 1, 1994, the Administrator shall 
                so certify to Congress.
                    (ii) In addition, the Administrator, in 
                consultation with the Secretariat for the NAFTA 
                Commission on Environmental Cooperation, shall report 
                to Congress on the outcomes of the investigations by 
                the Environmental Protection Agency on pollution and 
                health hazards in and around the United States-Mexico 
                border zone since NAFTA went into effect. The report 
                shall include--
                            (I) a description and status report of all 
                        industrial site cleanup and environmental 
                        improvement projects begun in the border zone 
                        since January 1, 1994;
                            (II) information available from local, 
                        State, and Federal health agencies reflecting 
                        the incidence since January 1, 1990, in and 
                        around the border zone of hepatitis, neural 
                        stem birth defects, lupus, chronic diarrhea, 
                        tuberculosis, nonneural birth defects, cholera, 
                        botulism, and other disorders commonly related 
                        to industrial pollution, inadequate 
                        infrastructures, and hazardous waste; and
                            (III) information on the incidence of air 
                        and water pollution since January 1, 1990, and 
                        the causes, levels, and types of pollution 
                        which have occurred.
            (5) Certification relating to illegal drugs.--If the 
        Attorney General of the United States determines, after a 
        review by the Drug Enforcement Administration and consultation 
        with appropriate government agencies and citizen organizations, 
        that the importation into the United States of illegal drugs or 
        other controlled substances from Mexico or Canada has not 
        increased since NAFTA went into effect, the Attorney General 
        shall so certify to Congress. The Attorney General, through the 
        Drug Enforcement Administration, shall conduct a thorough 
        review and report to Congress regarding the flow of illegal 
        drugs from Mexico and Canada and the relationship of such flow 
        to trade of other commodities and services with the NAFTA 
        Parties.
            (6) Certification relating to democracy and human 
        freedoms.--If the President, after consultation with 
        appropriate government agencies, international organizations, 
        and citizen organizations, determines that each NAFTA Party--
                    (A) elects its government in free and fair 
                elections;
                    (B) protects the rights of its citizens to organize 
                into political parties;
                    (C) protects the rights of its citizens to free 
                speech and the right of the news media to operate 
                without fear of government control or reprisal; and
                    (D) protects the rights of its citizens to assemble 
                and to organize associations to advance human rights 
                and economic opportunities,
        the President shall so certify to Congress.
            (7) Certification relating to nafta's effect on united 
        states agriculture.--If the Secretary of Agriculture, after 
        consultation with appropriate government agencies and citizen 
        organizations, determines that United States agricultural 
        interests have been left in at least as good a position as 
        before NAFTA, the Secretary shall so certify to Congress.
            (8) Certification relating to highway safety.--If the 
        Secretary of Transportation, after consultation with attorneys 
        general of the States, law enforcement officials, State highway 
        safety agencies, other appropriate government agencies, and 
        citizen organizations, determines that a comprehensive 
        enforcement system is in place to ensure that every Mexican 
        commercial truck or bus is properly inspected so that the 
        vehicle and its driver are in compliance with United States 
        transportation safety standards before crossing the border into 
        the United States, the Secretary shall so certify to Congress. 
        In making such determination, the Secretary shall review and 
        take into account the results of border inspections of Mexican 
        vehicles coming into the United States since January 1, 1994.

SEC. 4. RENEGOTIATIONS.

    (a) Renegotiate NAFTA To Correct Trade Deficits.--The President is 
authorized and directed to confer with the Governments of Canada and 
Mexico and to renegotiate the terms of NAFTA to provide for 
implementation of adjustments of tariffs, quotas, and other measures to 
stabilize the flow of trade among the NAFTA Parties when the dollar 
value of United States imports of goods and services from another NAFTA 
Party exceeds 10 percent of the dollar value of United States exports 
to that Party.
    (b) Renegotiate NAFTA To Correct Currency Distortions.--The 
President is authorized and directed to confer with the Governments of 
Canada and Mexico and to renegotiate the terms of NAFTA to provide for 
the implementation of adjustments of tariffs, quotas, and other 
measures to mitigate the adverse effects of rapid or substantial 
changes in exchange rates between the United States dollar and the 
currency of another NAFTA Party.
    (c) Renegotiate NAFTA To Correct Job Loss.--The President is 
authorized and directed to confer with the Governments of Canada and 
Mexico and to renegotiate the terms of NAFTA to ensure that under NAFTA 
trade with Mexico and Canada creates at least as many United States 
jobs as it costs United States jobs as measured by specific jobs 
created since January 1, 1994, compared to specific jobs lost since 
January 1, 1994, in United States trade with Mexico and Canada.
    (d) Renegotiate NAFTA To Protect Public Health and the 
Environment.--The President is authorized and directed to confer with 
the Governments of Canada and Mexico and to renegotiate the terms of 
NAFTA to ensure that--
            (1) under NAFTA--
                    (A) the rate of importation of food failing United 
                States safety standards from Mexico and Canada,
                    (B) the rate of hepatitis, chronic diarrhea, and 
                other pollution-related diseases along the United 
                States-Mexico border, and
                    (C) the rate of toxic waste dumping and other 
                improper disposal along the United States-Mexico and 
                United States-Canada borders,
        are no higher than before NAFTA went into effect; and
            (2) under NAFTA the air and water quality in the United 
        States-Mexico border zone, and along and near the border 
        between the United States and Canada, as determined under the 
        Clean Air Act and the Federal Water Pollution Control Act, are 
        no worse than before NAFTA went into effect.
    (e) Renegotiate NAFTA To Interdict Drug Traffic.--The President is 
authorized and directed to confer with the Governments of Canada and 
Mexico and to renegotiate the terms of NAFTA, including those relating 
to increasing border inspection of all cargoes coming from Mexico and 
Canada carried by truck, rail, or ship, to ensure that the flow of 
illegal drugs into the United States from Mexico or Canada is no 
greater than such illegal drug flow before NAFTA went into effect.
    (f) Renegotiate NAFTA To Correct Agricultural Provisions.--The 
President is authorized and directed to confer with the Governments of 
Canada and Mexico and to renegotiate the terms of NAFTA to provide for 
the implementation of tariffs, quotas, and other measures to bring the 
levels of wheat, durum wheat, and barley imported from Canada to levels 
that are comparable to the levels of these products imported during the 
10-year period before the date NAFTA went into effect. The President is 
further authorized and directed to renegotiate NAFTA to establish and 
strengthen provisions to prevent imports of agricultural commodities 
from any NAFTA Party from unfairly displacing United States production 
and to provide improved mechanisms for relief for United States 
producers that are adversely affected by such imports.
    (g) Renegotiate NAFTA To Ensure Compliance With United States 
Transportation Standards.--The President is authorized and directed to 
confer with the Governments of Canada and Mexico and to renegotiate the 
terms of NAFTA and other relevant agreements to provide for 
implementation of a comprehensive enforcement system to ensure that 
every commercial truck or bus entering the United States is properly 
inspected so that the vehicle and its driver are in compliance with 
United States transportation standards before entering the United 
States.

SEC. 5. CONSULTATION WITH CONGRESS.

    The President shall consult regularly with Congress regarding the 
certifications described in section 3(b) and the renegotiations 
described in section 4. The United States Trade Representative shall 
consult with the appropriate committees of Congress in the development 
of any technical and conforming amendments that may be required to 
carry out the provisions of this Act.

SEC. 6. NO EXPANSION OF NAFTA.

    Until such time as the conditions described in section 3 are met, 
it is the sense of Congress that the President should not engage in 
negotiations to expand NAFTA to include other countries and that fast-
track authority should not be renewed with respect to the approval of 
any such expansion of NAFTA.

SEC. 7. DEFINITIONS.

    As used in this Act:
            (1) NAFTA.--The term ``NAFTA'' means the North American 
        Free Trade Agreement entered into between the United States, 
        Canada, and Mexico on December 17, 1992, and effective as of 
        January 1, 1994.
            (2) NAFTA party.--The term ``NAFTA Party'' means the United 
        States, Canada, or Mexico.
            (3) United states-mexico border zone.--The term ``United 
        States-Mexico border zone'' means the area that comprises the 
        12-mile zone on the Mexican side of the United States-Mexico 
        border and the counties within any State of the United States 
        that are contiguous with Mexico.
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