[Senate Hearing 115-147]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 115-147
 
                  GROWING OPPORTUNITIES FOR BUSINESSES
                     AND SMALL FARMERS IN ACADIANA

=======================================================================

                             FIELD HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                          AND ENTREPRENEURSHIP
                          UNITED STATES SENATE

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            AUGUST 24, 2017

                               __________

    Printed for the Committee on Small Business and Entrepreneurship
    
    
    
    
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            COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP

                     ONE HUNDRED FIFTEENTH CONGRESS

                              ----------                              
                    JAMES E. RISCH, Idaho, Chairman
             JEANNE SHAHEEN, New Hampshire, Ranking Member
MARCO RUBIO, Florida                 MARIA CANTWELL, Washington
RAND PAUL, Kentucky                  BENJAMIN L. CARDIN, Maryland
TIM SCOTT, South Carolina            HEIDI HEITKAMP, North Dakota
JONI ERNST, Iowa                     EDWARD J. MARKEY, Massachusetts
JAMES M. INHOFE, Oklahoma            CORY A. BOOKER, New Jersey
TODD YOUNG, Indiana                  CHRISTOPHER A. COONS, Delaware
MICHAEL B. ENZI, Wyoming             MAZIE K. HIRONO, Hawaii
MIKE ROUNDS, South Dakota            TAMMY DUCKWORTH, Illinois
JOHN KENNEDY, Louisiana
          Skiffington E. Holderness, Republican Staff Director
                 Sean Moore, Democratic Staff Director
                 
                 
                            C O N T E N T S

                              ----------                              

                           Opening Statements

                                                                   Page

Kennedy, Hon. John, a U.S. Senator from Louisiana................     1

                               Witnesses
                                Panel 1

Dore, Bill, Vice President, Supreme Rice, LLC, Crowley, LA.......     4
Comb, Michael, General Manager, Cajun Sugar Company, LLC, 
  Louisiana Sugar Cane Cooperative, St. Martinsville, LA.........     9
Portier, Angela, Owner and Operator, Faith Family Shrimp Co., 
  LLC, Chauvin, LA...............................................    14

                                Panel 2

Melancon, Heidi, Director, Louisiana Small Business Development 
  Center, University of Louisiana at Lafayette, Lafayette, LA....    25
Laroski, Jr., Joseph A., Senior Advisor for Policy Office of the 
  Under Secretary for International Trade, Washington, DC........    29

                          Alphabetical Listing

Comb, Michael
    Testimony....................................................     9
    Prepared statement...........................................    12
Dore, Bill
    Testimony....................................................     4
    Prepared statement...........................................     7
Kennedy, Hon. John
    Opening statement............................................     1
Laroski, Jr., Joseph A.
    Testimony....................................................    29
    Prepared statement...........................................    31
Melancon, Heidi
    Testimony....................................................    25
    Prepared statement...........................................    27
Portier, Angela
    Testimony....................................................    14
    Prepared statement...........................................    16


   GROWING OPPORTUNITIES FOR BUSINESSES AND SMALL FARMERS IN ACADIANA

                              ----------                              


                       THURSDAY, AUGUST 24, 2017

                      United States Senate,
                        Committee on Small Business
                                      and Entrepreneurship,
                                                   Youngsville, LA.
    The Committee met, pursuant to notice, at 1:11 p.m., in the 
Youngsville City Hall, 305 Iberia Street, Hon. John Kennedy 
presiding.
    Present: Senator Kennedy.

  OPENING STATEMENT OF HON. JOHN KENNEDY, A U.S. SENATOR FROM 
                           LOUISIANA

    Senator Kennedy. Let's get started. Thank you, everybody, 
for coming. If you would stand for the pledge of allegiance.
    [Pledge of Allegiance.]
    Take your seats, folks. I want to call this hearing to 
order. I'm really looking forward to this today.
    The United States Senate does most of its work in 
committees. You hear about the results of our work when we vote 
on the floor of the United States Senate, but by the time we 
get to the floor of the United States Senate to vote, most of 
the work has already been done. The issues have been debated, 
and the details have been sliced and diced in committee, and 
that's why these committee hearings are so very, very, very 
important.
    I want to thank Chairman Risch, who is the chairman of the 
Senate Small Business Committee, on which I sit, and I want to 
thank Ranking Member, Senator Shaheen, from the Democratic side 
of the aisle as well, for allowing me to conduct this hearing 
today on some very, very important subjects, not just for 
Louisiana, but for America.
    I want to thank Meredith West. Where's Meredith? There's 
Meredith. Meredith is a Louisiana native. She is our 
committee's deputy staff director. I want to thank her for all 
her hard work and guidance, not just here, but in Washington.
    We also have with us today Renee Bender. Where's Renee? 
There you are, Renee--who works for Chairman Risch; Kevin 
Wheeler, who works for Senator Shaheen. Where's Kevin? There's 
Kevin. Welcome to Louisiana, Kevin. Try some of that shrimp and 
rice and sugar while you're here. We appreciate their hard 
work, and I want to thank them for doing this.
    Today, what we're going to focus on--and I'm going to try 
to keep my remarks short. We're going to focus on Louisiana's 
agricultural and seafood industry, and those are both 
important, because they're important to our economy here in our 
State.
    But it's not just our economy. It's part of our culture and 
part of our way of life. America and Louisiana were both born 
on a farm, and our farmers--and I consider our seafood 
producers--I guess we'll call them aquacultural experts. 
They're so efficient today that we just take what they do for 
granted. But never before have our farmers and those in the 
aquaculture business been so challenged by issues not only here 
in America, but abroad as well.
    Most of our people who are in the agricultural or seafood 
industry are small businesswomen and small businessmen. 
Together, agriculture has a total impact in Louisiana of about 
$11 billion. Let me say that again, $11 billion, and that is 
huge for our State. We have 28,000 farms in our State. We have 
about 90,000 people in Louisiana who live on those farms.
    Our seafood production--I'll speak generally here--has an 
economic impact of more than $2.4 billion from Louisiana. 
Louisiana is second only to Alaska for domestic seafood 
production, and Alaska, of course, is much bigger than we are. 
So I felt like our Small Business Committee would be a perfect 
setting to get into some of the issues that our farmers and 
fishermen and fisherwomen face, because they're small business 
owners.
    Here in Lafayette Parish--let me just say a word about 
Lafayette, and I want to thank Youngsville and Lafayette for 
hosting us today. Most of our farms here in Lafayette Parish, 
about 85 percent, are owned by either families or individuals, 
and that's pretty true all across Louisiana. We don't really 
have a lot of big corporate farms, as do some states. Our State 
is mostly about small business. Our seafood producers are in a 
similar situation. Most of the boats and the processing 
facilities in Louisiana are family owned and family operated, 
and they've been, in many cases, in those families for 
generations.
    Small farmers and seafood producers face so many challenges 
today. Red tape--we'll talk about that today. I hope to hear 
from our experts on that subject, and I think I will. Taxes, 
which is something we're going to be talking about a lot in the 
United States Senate after Labor Day.
    Trade challenges--everybody believes in free trade, but 
it's got to be fair trade. There's got to be a level playing 
field, and, unfortunately, we play by the rules, but a lot of 
our competitors don't. They cheat, and it's up to us and the 
Federal Government to try to address those challenges, and I 
hope that we can talk about the challenges in that respect and 
also about the need for new markets.
    We live in a global economy. Our competition 50 or 100 
years ago might be Mississippi or Texas. Today, our competition 
is worldwide, and so the business has changed in that regard as 
well. I'm going to take what I learn today back to the Small 
Business Committee of the United States Senate, and, hopefully, 
we can try to address some and maybe even all the concerns that 
are raised today.
    I thought what we would do--we don't have time to talk 
about every crop that's grown in Louisiana. I think it's a 
blessing, but if we did that, we'd be here for days. I'm really 
proud of our farmers and our seafood producers and our timber 
producers. So we're going to focus on sugar and shrimp and 
rice.
    I want to introduce--and then I'm going to hush--our first 
three panelists. Mr. Bill Dore. Bill has been the Vice 
President of Supreme Rice, LLC, since 2007. Supreme Rice was 
acquired by the Louisiana Rice Mill. Bill has previously served 
as President of Supreme Rice Mill from 1980 to 2007. Mr. Dore 
has been a member of the Rice Millers Association Board of 
Directors since 1983. He was elected chairman of the board in 
1991. He's a third-generation rice mill owner.
    Our second panelist is Mr. Michael Comb. Michael serves--
I've known him for a long while. He's the General Manager of 
the Louisiana Sugar Cane Cooperative. He graduated from the 
University of Louisiana, when it used to be called the 
University of Southwestern Louisiana, with a B.S. in 
Agricultural Engineering. Before working for the Louisiana 
Sugar Cane Cooperative, he farmed sugar cane for 22 years. So 
he knows of which he speaks.
    Ms. Angela Portier--am I saying that right, Angela?
    Ms. Portier. Portier. That's pretty good.
    Senator Kennedy. Portier--thank you--is the owner and 
operator of Faith Family Shrimp Company, LLC, in Chauvin. She 
and Chad, her lesser half--she's the better half--where's Chad? 
Is Chad here? Hey, Chad.
    Mr. Portier. You're right about that.
    Senator Kennedy. I hear you, man.
    They are long-time shrimpers. They both come from shrimping 
families. Angela serves on the boards of both the Louisiana 
Shrimp Association and the Southern Shrimp Alliance, which, of 
course, is a multi-State association.
    Our second panel, when we finish--we're going to hear from 
a couple of agencies. Heidi Melancon--Heidi is the Director of 
the Louisiana Small Business Development Center at the 
University of Louisiana at Lafayette. She provides leadership 
support for the eight-parish Acadiana region. She's been with 
the network for 12 years and has served in leadership, 
consulting, and training roles. Heidi has counseled hundreds of 
startups and existing businesses over the years, resulting in 
clients obtaining financing as well as launching and growing 
their small business. Heidi has an MBA and a Bachelor's from 
the University of Louisiana at Lafayette, and her Center helps 
entrepreneurs get started with consulting and training and 
other resources.
    We will also hear in our second panel Mr. Joseph A. 
Laroski, Jr. He is a Senior Advisor of Policy in the Office of 
Undersecretary for International Trade at the International 
Trade Administration. He received his law degree from Fordham 
University in 1997. He received a masters in law, with a 
concentration in trade law, from Georgetown in 1998. He's held 
counsel and advisory roles at the Office of the U.S. Trade 
Representative, the law firm of King and Spalding, and the U.S. 
International Trade Commission.
    I do want to note that an agency that I wanted to have 
represented here today, but, unfortunately, couldn't be, is our 
USDA. USDA informed us that they don't have a Louisiana 
director in place for the Farm Service Agency yet, so they 
wouldn't have the right personnel for the hearing. I regret 
that.
    My staff reminded them that we had given them a 
recommendation way back in January of someone that I think will 
be terrific in that position. He's highly qualified. He's 
already on the job, and he has the confidence of our 
agricultural industry. So, anyway, that concerned me a little 
bit, but that will be between me and the Administration. We'll 
have a little prayer session when I get back and see where we 
are on that.
    What I thought we'd do is ask each of our witnesses to give 
a five-minute statement, and then I'll have some questions. 
Feel free to go over a few minutes if you have to. I came here 
to learn today. I've already talked way longer than I wanted 
to.
    Why don't we start with Bill?

  STATEMENT OF BILL DORE, VICE PRESIDENT, SUPREME RICE, LLC, 
                          CROWLEY, LA

    Mr. Dore. Thank you, Senator. It's an honor to testify in 
front of you. Especially, it's nice to testify in front of 
somebody that you voted for----
    Senator Kennedy. Well, thank you.
    Mr. Dore [continuing]. And somebody that you're still happy 
that you voted for, if you know what I mean.
    Senator Kennedy. I do. I do.
    Mr. Dore. I just want it noted, please, that this is a 
company-specific testimony that I'm giving. It's not industry-
wide. It's not meant to be a statement for the whole rice 
industry or anything like that.
    Supreme Rice has three milling facilities, two of which are 
in south Louisiana. We have support facilities all over south 
Louisiana to support our milling assets. We employ 
approximately 200 people. Our company has been in business 
continuously since 1935. It is privately owned. At one time, 
there were 44 rice mills in Louisiana. There are now four. The 
four mills now mill more rice than the 44 mills used to. So if 
you're not growing, you're doomed, so to speak.
    Our President and CEO is Bobby Hanks, who I know you know.
    Senator Kennedy. I know Bobby well.
    Mr. Dore. He's also one of our owners. He couldn't be here 
today, so he asked me to fill in. Our company is consistently 
rated as one of the top 10 companies in Acadiana in terms of 
sales. We sell rice both domestically and for export. 
Certainly, over the last 40 years, we've sold rice to every 
continent, other than Antarctica, and into probably over 90 
percent of the countries throughout the world.
    Generally speaking, when the government comes calling and 
says, ``We want to help you,'' the rice milling industry says, 
``You know, we really don't want the help.'' We take the 
position that if help is going to be given to the rice 
industry, it should be done at the grower level, and it 
probably should be done with direct payments. When there are 
not direct payments, a lot of market distortion can occur. A 
good example of that is the syrup mill, the sugar syrup mill 
that we had in Lacassine, as you are well aware of.
    Senator Kennedy. Very familiar with it.
    Mr. Dore. There's now a facility that the government has 
given a $5 million grant to that's designed to export rough 
rice to Mexico. It's my understanding that the government is 
still subsidizing part of that operation, the operating 
expenses of that as well. Basically, what that results in is 
our tax dollars are now used to give advantage to Mexican rice 
mills, and, therefore, our rice mills, our warehousemen, a lot 
of our trucking--all these support industries that we have in 
the U.S. and in Louisiana miss out on all of that while Mexico 
gets to take advantage of it, while our tax dollars support 
that.
    So from a rice milling perspective, it's pretty difficult 
when we see our tax dollars being used for that. That's why we 
feel it's better to give funds directly to growers and let them 
decide how they want to invest it, how they want to use it, and 
when they want to use it.
    Trade agreements that result in a level playing field, as 
you talked about, are critical for our future success. WTO has 
everything in place to make this happen. However, it's so 
deeply bureaucratic that it's become an impotent instrument to 
carry out its own fair trade rules. Our own U.S. trade 
negotiator is unable, after decades, to accomplish even the 
most basic and simplest reforms in the face of gross and 
obvious violations throughout the world. Either a radical 
overhaul of WTO is going to have to occur--which, I promise 
you, will not happen. It's just practically impossible for that 
to occur--or a whole new trade order is imperative.
    On the other hand, we have NAFTA, which has been a 
difficult but somewhat successful trade agreement from rice's 
perspective. When it began 20-some-odd, I guess, years ago, it 
had punitive tariffs for milled rice and no tariffs on rough 
rice. Over that long period of time, the tariffs on milled rice 
have now decreased to zero, and during that time, it gave a 
huge advantage to milling operations in Mexico. That gave them 
a chance to invest in infrastructure and develop their brands 
over a long period of time. U.S. milled rice sales are now 
slowly growing in Mexico.
    From a milling perspective, this is not a great template 
for future negotiations, but it's not a terrible--it hasn't 
been a terrible outcome as compared to what WTO is, which is no 
outcome. On occasion, there's been rumblings in Washington 
where the government wants to start sourcing food aid from 
outside of the U.S., almost always wanting to source that food 
aid from third-world countries. It's our opinion that this 
would be a terrible mistake.
    Senator Kennedy. What do you mean, sourcing?
    Mr. Dore. They want to go buy that food from third-world 
countries, take our tax dollars and buy that food from our 
competitors. In our opinion, this would be a huge mistake. The 
U.S. is recognized as one of the most trustworthy sources of 
high-quality, sanitary food that's available in the world. Not 
only would this use taxpayer dollars to support foreign 
competition, but it would also defeat the purpose of market 
development within food aid and subject the reputation of U.S. 
food as a reliable supplier to other countries in their time of 
need.
    But, probably, above all, the best hope of prosperity in 
society as a whole is enlightened tax and regulation policy. 
Many times, government at every level looks to business to 
solve their spending problems and public policy issues, for 
which business should not be relied upon, and for which it's 
ill suited to solve. This threatens our tax base, the 
prosperity of our future generations, and the harmony of our 
social fabric.
    So thank you very much, Senator Kennedy. I kindly 
appreciate the opportunity.
    [The prepared statement of Mr. Dore follows:]
    
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    Senator Kennedy. Thank you.
    Before we go to Michael, I wanted to--is our mayor here?
    Mayor, I wanted to thank you for your hospitality today. 
It's an honor to serve with you. I think one of your 
colleagues, Councilman Romero, is here.
    Councilman, thank you. Thank you both.
    I'll tell you a secret. Nobody calls me at 10 o'clock on a 
Friday, and I know you get the calls, and folks stop you at 
church and at the grocery store and when you're trying to have 
a meal, and the toughest form of government is local 
government, far and away, because it's closest to other people, 
and I want to thank both of you.
    I know our Chief was here--is he here? Chief, thank you as 
well. Everything I said to them, I'll say to you. Thank you for 
your service.
    Let's go to--we'll save our best for last. We'll go to 
Michael second.
    [Laughter.]
    Mr. Comb. I was hoping you would say I'd be second, because 
I'm definitely not the best. Thank you.

    STATEMENT OF MICHAEL COMB, GENERAL MANAGER, CAJUN SUGAR 
      COMPANY, LLC, LOUISIANA SUGAR CANE COOPERATIVE, ST. 
                        MARTINSVILLE, LA

    Mr. Comb. Good afternoon. My name is Michael Comb. I serve 
as General Manager of Louisiana Sugar Cane Cooperative, or 
LASUCA, as we call it. It's a cooperatively owned mill in St. 
Martinsville, Louisiana.
    My mill, along with 10 other mills in the Louisiana sugar 
cane belt, exists to mill the sugar cane owned by about 450 
family farmers in south Louisiana. Many of the mills are 
cooperative, owned by the farmers, like LASUCA, or are family 
owned businesses themselves.
    Sugar cane is grown on about 400,000 acres in 22 parishes, 
and our farmers produce approximately 13 million tons of sugar 
cane each year. Our 11 mills extract 1.6 million tons of raw 
sugar from the cane. We store that sugar until it's needed by 
the two refineries, which are located along the Mississippi 
River. Sugar cane production and processing results in an 
overall annual economic value to the State of about $3 billion.
    But it all starts with the small businesses and the farmers 
that produce the crop. My mill cannot exist without that crop, 
and the farmers can't extract the full value of that crop 
without our mills. As small businesses, and the mills dependent 
upon them for our existence, our concerns are entwined.
    Our farmers do face a number of regulatory hurdles, and I 
know that they're very appreciative of the number of actions 
that the Trump administration has already taken to reduce this 
regulatory burden, especially EPA's onerous Waters of the U.S. 
rule. However, at the moment, their biggest concern is hoping 
that the rain stops so they can get back in the fields and 
plant their sugar cane, because grinding is soon beginning, so 
they need to finish the planting first.
    Hand planting sugar cane in south Louisiana in August and 
September is temporary work that our domestic labor force has 
never really embraced. Louisiana's diverse ethnic population is 
in part a result of the waves of immigrants coming through New 
Orleans on the way to our sugar cane fields, with each 
successive wave moving on to full-time jobs in other industries 
and leaving our farmers in need of temporary help. That's why 
the H2A program is so important to our growers. They'd like to 
see a more streamlined approach, especially to the application, 
interview, and approval process, and also they remain 
frustrated by the prevailing wage determination.
    Louisiana is the northernmost point in the world where 
sugar cane is grown commercially. This forces us to adapt a 
shortened growing season and an accelerated grinding season to 
account for the winter months. The farmers will begin 
delivering cane to our mills in late September, beginning a 
100-day harvest and grinding season. It's a race against 
inclement weather that can destroy the crop in the fields. 
Because of this unique 100-day schedule, our mills maintain a 
small workforce. But we need access to some specialized skill 
sets via the H2B program, particularly during the grinding 
season.
    Luckily, many mills in Central America conclude their 
grinding seasons immediately before Louisiana's seasons begin, 
and then they ramp up their processing after we're done. In 
many cases, workers specialized in the crystallization of sugar 
have completed their domestic grinding in Central America, and 
they bring their skills to the same Louisiana sugar factories, 
and they have been doing that for decades, increasing the 
efficiency of our operations and improving the returns to our 
growers.
    But access to the H2B program has become very problematic 
because of huge new demand from other sectors that far exceeds 
the annual cap on that program. We really need to make the 
returning work exemption permanent. This would allow access to 
a vital skill set with a proven record of making us more 
efficient, and then going home, because these workers do not 
remain here.
    Just as the small businessmen on the farm and the mill do 
not survive alone, none of us will be in business without a 
strong U.S. sugar policy. After four years of trial and error, 
Secretary Wilbur Ross negotiated modifications to the 
suspension agreements that were put in place after Mexico was 
found to have subsidized the sale of dumped sugar into the U.S. 
markets during calendar years 2013 and 2014, which accounted 
for domestic losses of about $2 billion and an additional $2 
billion under the original suspension agreements.
    So we really have to thank you, Senator Kennedy, for being 
a champion with the Administration through these difficult 
negotiations. We're hopeful that the modifications will work as 
the Administration envisions. Implementation begins on October 
1st, and enforcement is the key part to help in solving that.
    Senator Kennedy. Secretary Ross gets it. He gets it.
    Mr. Comb. Seems to be that way. Thank you very much for 
that.
    I also mention this because the five-year reauthorization 
of the farm program is set to expire in October of 2018, and 
the leaders of the authorizing committees indicate that they 
want to start moving bills in early next year. U.S. sugar 
policy is certain to come under attack, as during every farm 
bill, just as we expect the tax and appropriation battles 
you'll have in September. At the same time, our customers have 
already demanded that Mexico be granted new access to legally 
circumvent the freshly modified suspension agreements.
    So I guess if I could leave you with one message, it's 
this: The last thing the U.S. sugar producer needs is more 
uncertainty. Implementing the new agreements will be greatly 
complicated or even torpedoed if we re-open sugar negotiations 
with Mexico. Any new market access commitments involving other 
countries will exponentially increase the difficulties of 
implementing and enforcing these modified agreements. Maintain 
a strong U.S. sugar policy and implement the new suspension 
agreements without introducing further volatility.
    Thank you.
    [The prepared statement of Mr. Comb follows:]
    
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    Senator Kennedy. Thank you, Michael.
    Ms. Portier? Did I get it right this time?
    Ms. Portier. That's good. It's perfect.

 STATEMENT OF ANGELA PORTIER, OWNER AND OPERATOR, FAITH FAMILY 
                  SHRIMP CO., LLC, CHAUVIN, LA

    Ms. Portier. Thank you for having all of us and for 
inviting me to speak this afternoon.
    Senator Kennedy. You bet. Thank you.
    Ms. Portier. I'm here today because I am passionate about 
the jobs and health of our fellow American citizens. I want you 
to know, as a commercial fisherman and small business owner, 
the concerns of our shrimp industry in Acadiana.
    First, I'd like to talk about the import problem we are 
facing and have you aware that this issue is getting worse. 
Louisiana shrimp competes for sales in a market dominated by 
imports. Last year, the United States imported 1.2 billion 
pounds of shrimp, the most that we've ever imported. This year, 
we are up in imports another 10 percent. The increase is due to 
Indian shrimp, which now accounts for one out of every three 
pounds of imports. In the first half of the year, America 
imported 50 million more pounds of Indian shrimp than the first 
half of 2016.
    We are learning that the European Union imposed a 
requirement that 50 percent of all Indian shrimp imported into 
Europe be tested for banned antibiotics. Reports are showing 
that Indian shrimp may be banned from Europe in the near 
future.
    As commercial fishermen, we are heavily regulated and 
required to compete with foreign industries that lack 
regulations, where almost anything goes. Doing something about 
the over-regulation of Louisiana commercial fishermen is 
crucial at this point, and it is actually just as important to 
do something about the under-regulation of imports.
    The amount of fraud that goes on with seafood imports is 
out of control. When FDA took action against contaminated 
Chinese shrimp, that shrimp was relabeled as a product of 
Malaysia and sold to American consumers. Uncontrolled fraud is 
why our commercial fishermen need the Seafood Import Monitoring 
Program. This program will help prevent illegal, unreported, 
and unregulated caught and/or misrepresented seafood from 
entering U.S. commerce. It is also why Louisiana shrimpers 
believe that NOAA fisheries should lift its administrative stay 
on the application of that program to shrimp.
    As fishermen, we have to give account for every pound of 
shrimp that we land and sell. There are no similar requirements 
in place for shrimp imports. Our product is traceable, but the 
imports we compete with are not.
    The second topic I would like to discuss today are the 
regulations on Acadiana shrimpers, and it's about the building 
of the vessels. There are now strict laws on building new 
commercial fishing vessels. These laws require that the vessel 
is designed by an individual licensed by a State as a naval 
architect or marine engineer, and for the design to incorporate 
standards equivalent to those prescribed by a classification 
society to which the Department of Commerce has delegated 
authority. As commercial fishermen, we cannot afford a naval 
architect or a marine engineer.
    These laws are causing very few, if any, new vessels to be 
constructed in the southeastern U.S. commercial fishing 
industry. Through these laws, we are continuing to lose small 
shipyards that construct these vessels. Owners and operators 
are forced to retain older vessels which are less safe and more 
expensive to maintain. Slowly but surely, these laws are 
putting fishermen out of business and in danger.
    We are also facing more rules on turtle excluder devices, 
TEDs, which have to be pulled in our nets. We do have laws in 
place right now for our bigger boats to pull the TEDs. We have 
been doing so for many, many years and have accustomed our 
livelihoods to abide by all the laws concerning TEDs.
    But we are hearing talk that if they make the smaller boats 
pull the device, at the same time, NOAA will change the 
equipment that the bigger boats are pulling and require us to 
pull a different size TED. At this time in our industry, with 
low shrimp prices, we cannot afford to buy this new equipment. 
Saying all of this, there is no recent data on the status of 
our Louisiana turtles, and before we are required to pull these 
devices in our nets, we should be entitled to know the quantity 
of the Louisiana turtle.
    Senator Kennedy. And who would have that? NOAA?
    Ms. Portier. Wildlife and fisheries, NOAA, maybe. I'm not 
exactly sure, but I can find out.
    Increasing Federal regulations drive up our costs. We can't 
get those costs back from our sales because we have to compete 
with imports that don't have to worry about regulations, and 
those imports don't have to worry about taking losses, either, 
because of the subsidies they receive from their governments. 
We also would need to be subsidized to be able to continue this 
line of work in America.
    We do have more problems facing our industry, which would 
be the growing dead zone in the Gulf of Mexico caused by 
chemicals brought down from the Mississippi and white spot 
disease brought into the country with shrimp imports that may 
be suppressing the growth of our shrimp.
    Thank you for taking time out of your schedule and hearing 
about our industry.
    [The prepared statement of Ms. Portier follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
      
    Senator Kennedy. Thank you, Angela.
    Let me ask some questions. Oh, this is great. We'll start 
in reverse order.
    Angela, if you were queen for a day, and you could just 
make whatever changes you wanted to make to help our shrimp 
industry, what would be the first thing, the second thing, the 
third thing, in terms of addressing your problems? Is it 
regulations?
    Ms. Portier. It's probably the imports. We're fighting the 
imports. In 2014, when we had--they had some ponds overseas 
that were diseased, and it was only like a 14 percent cut, our 
shrimp prices went through the roof. That year, we averaged $2 
a pound on white shrimp, head on, and $2 a pound on brown 
shrimp, head on. So just that little bit of stopping the 
imports caused our--the demand for our product. So, probably, 
imports would be number one.
    Senator Kennedy. When we compete with other countries and 
their imports, are their seafood producers subsidized by the 
government? Are they cheating?
    Ms. Portier. I think so. I'm almost positive. I mean, I 
could ask--you know, we have a lawyer for SSA and a lawyer for 
LSA, so they would have all that information. So number one 
would be imports.
    Number two would be the regulations on the building of the 
shrimp vessels. My husband just built a 76-foot, steel hull, 
brand new--two and a half years it took them, you know. But he 
was grandfathered in. He had a backdated keel. But so if he 
wants to try to build that same vessel, it's not happening.
    Senator Kennedy. Who imposed the rule on the vessels? Is it 
a statute or a regulation?
    Ms. Portier. I'm not sure.
    Senator Kennedy. Do you know----
    Mr. Emel. It's a Coast Guard issue.
    Ms. Portier. Coast Guard.
    Senator Kennedy. Why do they do it? Safety?
    Mr. Emel. What they're doing--prior to--well, they're 
trying to establish across the whole fishery in the--I'm Thomas 
Emel with LSU Ag Center, and I work with the industry. What 
they're trying to do is to install the same sort of safety 
measures that are required in a North Sea Alaska vessel to the 
conditions that we have here in the Gulf of Mexico, which is a 
whole different thing.
    Out there, boats break up because of high seas. Our biggest 
issues over here are man overboard issues and certainly not 
vessel destruction by the elements. So they're trying to make 
one size fit all, and so they're bringing----
    Ms. Portier. Trying to put us all in one group.
    Mr. Emel. Trying to do that, and so what's causing--what 
she's saying is exactly true. We don't build these boats 
anymore because we can't. So there's more and more regulations 
like that coming down on our industry.
    Senator Kennedy. Is it a regulation or a statute?
    Mr. Emel. I think it's rulemaking inside of the Coast 
Guard. I don't that it's a particular statute. I think it's 
regulatory oversight, or regulatory overdone.
    Ms. Portier. Now, they want to hear our comments on--by 
September 11th, we can make comments to U.S. Coast Guard and 
who else.
    Senator Kennedy. So if you're an adult, and you're 
satisfied with the safety of the vessel that you want to use, 
that's not good enough. You've got to satisfy Washington, D.C., 
which knows better than you do.
    Mr. Emel. A hundred years of building vessels and floating 
them in the Gulf of Mexico, and now you can't do it because 
somebody somewhere else has determined that you can't do it. 
The rhyme or reason of it--we don't understand that, but that's 
just how government seems to work in our seafood industry. It 
just comes down and comes down and keeps coming.
    Senator Kennedy. Well, that's just stupid.
    Ms. Portier. My husband's dad had a shipyard. His brother 
took over the shipyard recently. He built 150 boats in his 
lifetime. Ninety-five percent were commercial fishing vessels. 
None of them have ever sunk, like--they're great, you know, and 
we didn't have all these----
    Senator Kennedy. Who's your dad?
    Ms. Portier. It's Chad's dad. He passed away two years ago.
    Senator Kennedy. Okay. I'm sorry.
    Ms. Portier. Thank you.
    Senator Kennedy. So the bureaucracy in Washington figures 
they know better than you do about how to build a boat, and 
even if they did--and they don't--it's your decision. I mean, 
if you're comfortable with the safety of the boat--it's just 
stupid.
    Audience Member. Well, whenever they came down to my boat, 
the people that were making the laws or whatever, they came 
down and looked at it, and they said that--they don't even have 
a clue of what they're doing, because the boat that we were 
building was actually more structurally solid than the ones 
that were in Alaska already. But they just want to put more--I 
guess somebody else needs more money or a higher--I'm not sure. 
But as far as the boat itself, it's better than what they were 
wanting us to build.
    Senator Kennedy. Were you going to mention one other thing, 
Angela?
    Ms. Portier. So that would be the second. I don't know what 
the third would be.
    Senator Kennedy. Red tape?
    Ms. Portier. Yeah, yeah.
    Senator Kennedy. Okay. All right.
    Let me turn to Mike. Secretary Ross came through for us.
    Mr. Comb. Yes, sir. He did.
    Senator Kennedy. He did. He gets it. Robert Lighthizer, our 
new trade representative, gets it. They understand. I don't 
mean any disrespect to our friends in Mexico, but they were 
cheating. What are going to be our challenges in enforcement?
    Mr. Comb. Challenges in enforcement--a lot of it is going 
to circle around, I guess, the definition of raw and refined 
sugar, as it did with the first one, to make sure that they're 
not bringing in a refined product and calling it raw and 
selling it directly to the consumers. You know, as Angela 
stated, sugar cane is a lot like shrimp, or sugar is a lot like 
shrimp.
    You know, we're competing--sugar is one of the most highly 
subsidized commodities in the world. Most countries that are 
producing sugar on a large scale provide some sort of industry 
support either through direct payments, infrastructure support, 
and Mexico is no different. So what Mexico tends to do is sell 
in Mexico for a higher price than when they bring their sugar 
to the U.S., actually selling it below their cost of 
production. But that's probably the main thing--is being sure 
that they don't bring more sugar than they're allowed to and 
that the definition of that sugar is followed.
    Senator Kennedy. Are there other countries that do what 
Mexico has done that we have to worry about?
    Mr. Comb. No, not really. Because of the trade quotas we 
have with various countries, they're bringing in all the raw 
sugar that ends up in the refineries, and there's not a lot of 
definition on the quality, just the quantity. Since this is all 
coming in by ocean-going vessels, it's easier to monitor. When 
Mexico is bringing it across the border by truck or small 
packages, it becomes very difficult to monitor the amounts and 
qualities and quantities.
    Senator Kennedy. What about NAFTA? Do you have any thoughts 
on that?
    Mr. Comb. Well, the problem we have with Mexico is a 
direct--it came from that. I don't have the numbers in front of 
me, but, you know, Mexico's imports into the U.S. have grown 
exponentially since NAFTA, from hardly anything to well in 
excess of a million--1.5 million tons or greater per year. 
They're bringing in as much sugar as we produce in Louisiana.
    Senator Kennedy. You mentioned the Waters of the United 
States rule, and I think that's a perfect example of government 
gone crazy.
    Mr. Comb. I agree.
    Senator Kennedy. In the Senate, we have passed 14 bills 
under the Congressional Review Act, throwing out nonsensical 
rules and regulations that next year will save the American 
business community probably $70 billion. We've run the numbers. 
It's going to save about 62 million hours of paperwork. But 
that's just a handful of all the 1.2 million rules that we 
have.
    The Trump administration has directed every cabinet 
secretary to go through the rules and regulations in his or her 
agency and repeal the ones that don't make sense. Though that's 
easily said, sometimes it can take two or three years through 
the Administrative Procedure Act to get rid of them. But a lot 
of secretaries have discretion just not to enforce a rule.
    But for those who don't know about--I mean, my 
understanding of the Waters of the U.S. rule is that, 
basically, EPA and to some extent the Corps could--if I had a 
puddle in my backyard, they could take jurisdiction of my 
property. That's how bad it was.
    Mr. Comb. Yes. One interpretation was during a--not what 
I'd call a major rain event, but a significant rain event--that 
most of south Louisiana would be considered a navigable 
waterway, under their jurisdiction.
    Senator Kennedy. Unbelievable. Okay. If you were king for a 
day, and you could make whatever changes you wanted to make, do 
you have any thoughts on that?
    Mr. Comb. Well, I guess number one and two--you know, the 
first we've spoke about is fair trade, you know. I hate--they 
use the term, free trade, but it's not--it needs to be fair. 
Secondly is a little bit I spoke about, but foreign labor in 
the U.S. I know that's a very touchy subject. But it's 
something that we have been doing from a sugar mill standpoint 
for 40-plus years--is bringing in that skill set from Central 
America, that skill set that's not available here in the U.S. 
when it comes to the crystallization of sugar.
    It's just that these programs have become very, very 
difficult to navigate. We're constantly--I mean, today, we have 
mills in Louisiana that should be starting by the 20th of 
September, because of the size of this crop, that are having to 
wait to crank up until after October 1st because they have to 
wait until the new quota comes in for the new people coming in 
from foreign countries. That, along with burdensome 
regulations.
    You know, when you look at just how difficult it is to 
construct a new boiler, which is essential for a sugar mill 
operation--you know, here sugar mills have been using renewable 
fuel for 200 years. This whole concept of green energy----
    Senator Kennedy. You were the first?
    Mr. Comb. Yes, I think we may have been. You know, the 
concept of green energy is something we all know how to do, and 
our boilers use natural cane fiber to fuel them. We don't use 
fossil fuels. However, when we go to construct a new unit, if 
we can even get permitted to construct a unit, we have to 
follow the same burdensome regulations as someone that would be 
firing a boiler under coal or gas or fuel oil.
    There was a lot of talk in the past about carbon 
sequestration, and, you know, if we just look at it, sugar cane 
plants pull the carbon out of the atmosphere, and then we 
release it back when we burn it. So it's very net neutral, you 
know. We're not doing anything to hurt the environment when we 
burn bagasse. So that would be one thing I'd like to fix. But 
number one and two on the list would be trade and also when it 
comes to labor.
    Senator Kennedy. The arrangement that Secretary Ross worked 
out with Mexico--if we can get them to abide by it, can we live 
with that?
    Mr. Comb. If they abide by it, I think it would fix the 
issues that we have with Mexico today.
    Senator Kennedy. Well, we're talking about Wilbur Ross, the 
Secretary of Commerce. He couldn't have been more helpful. I 
mean, he gets it. He indicated when I first talked to him that, 
you know, it would take him a while to get up to speed, and 
he'd have to go check with--he got it right immediately. I 
mean, he is a very, very, very impressive guy, a good choice by 
the president.
    Mr. Comb. He did very well, and, also, you know, we thank 
you for all your help. You're a champion for us.
    Senator Kennedy. Well, you're welcome. But he--in terms of 
trying to convince the agencies to do it, it helps if they can 
just immediately pick up and they understand the real-world 
ramifications, and he does. He does. I also think Sonny Perdue 
is going to be great at Agriculture. Sonny was a good governor 
of Georgia, and he understands agriculture.
    All right. Let's talk some rice. What can we do to help 
open new markets? A few months ago they sent me to China. I 
went to Tokyo and met with the governor. I told them if they 
ever tried our rice, they'd like it better than theirs.
    What can we do to help with new markets?
    Mr. Dore. Well, we love having a free trader in office, a 
good advocate for free trade, because it's a proverbial level 
playing field argument for us. We have--our growers grow the 
most--the highest quality rice, and we have the most efficient 
growers practically throughout the world. If we could ever get 
a level playing field, we would have maybe the most prosperous 
agriculture anywhere in the world in rice here in the United 
States.
    Senator Kennedy. What do you mean by level playing field?
    Mr. Dore. Where we don't have trade barriers into China is 
a good example, into the Pacific Rim, Taiwan, Japan, places 
like that. It doesn't have to be the whole world, for heaven's 
sakes, but WTO, as I mentioned, is not doing anything. I mean, 
they're not doing anything, not just for rice, but for nobody. 
I just don't understand the justification of why they still 
have office buildings all over the world, because they're not 
accomplishing anything.
    There needs to be a fundamental change and just a re-boot 
of whatever we're going to do throughout the world as far as 
trade negotiations go, because there is nothing going on to get 
a new order of trade. If we're going to really move toward free 
trade in this world, which I think most policy makers think is 
really a good idea, we need to move towards that.
    Senator Kennedy. If it's a level playing field.
    Mr. Dore. If we can move towards that, it's going to be 
great for rice here in the U.S. It's going to be really great 
for the growers, the whole infrastructure and everything.
    Senator Kennedy. Why do you think the WTO can't be fixed?
    Mr. Dore. I've been around this for 40 years. WTO has been 
around for 40 years. WTO made one tiny little move in the 
Reagan administration, and it was a failure, and they 
ballyhooed it as the greatest thing in the whole world, that we 
were going to have all of this success with it. They've done 
nothing since then and can't do anything. They can't get 
anything off the ground.
    They can't--it's like the Vietnam War. They can't agree on 
the--you know, what the table should look like, for heaven's 
sakes. I mean, it's impossible. It needs to be re-booted. They 
need to all be fired and start over again with a level playing 
field with WTO. It's just broken, and it can't be fixed.
    Senator Kennedy. What about Iraq?
    Mr. Dore. We have access to Iraq now. Our issue with Iraq 
is we have pretty tough competition going into there. Right 
now, because we have a fairly short crop here in the U.S. this 
year, our prices are fairly high compared to prices from our 
competitors. So we're going to have a tough time in the short 
term going into Iraq.
    Senator Kennedy. Our competitors didn't spend trillions of 
dollars in the country, though.
    Mr. Dore. That was--you took the words almost right out of 
my mouth. You know, we could use some political help there. I 
hate to exert political help in the sense that----
    Senator Kennedy. It's not political help. It's just a fact.
    Mr. Dore. It's just a fact. But, you know, that's always 
helpful when we can--if we can use that card, you know, to help 
get us business. There's no doubt about it. We actually have a 
negotiation going on now, which I'm a little bit optimistic 
about. We might sell some rice to them here this week, so I'm 
keeping my fingers crossed. We might not, either, you know. The 
most optimistic thing in the world that people have been saying 
for the last five or six months is ``We're getting ready to 
sell Iraq rice.''
    Senator Kennedy. Yeah, I know.
    Mr. Dore. So it might be another--that might be the same 
thing, you know, we're saying right now. But I think in time, 
especially--I know it's a difficult--Iraq is struggling, 
obviously. I think they're trying to get their feet on the 
ground. It's got to be tough over there. They have money 
issues, obviously, so you can understand if they're trying to 
save every penny that they can. But any time we can ask them to 
help our industry out a little bit, that's always helpful. No 
doubt about it.
    I think, though, in the long term--I mean, I'm speaking 
personally, of course--I think the best policy is a free trade 
policy in the long term, so you don't have to go around and, 
you know, beg your friends, so to speak, to have to trade with 
you. That's why I think this policy and issues--if we can get 
the right policies going in the long term, we don't have to 
have so much political interference, to lean on our Senators to 
go get us some business, so to speak.
    Senator Kennedy. Well, this has all been incredibly 
helpful. Our staff will, without whom we--you quickly learn 
this in the Senate. Without our staff, we couldn't function. If 
they all go on strike at the same time, I don't know what we'll 
ever do. We will follow up.
    One thing we didn't talk about--but it's important, and 
it's going to be on our plate in the United States Senate when 
we get back--and that's tax reform. We haven't had a major 
revision of our tax code since 1986. Some of my colleagues talk 
about tax reform, and we do need to reform the tax code. I want 
to start, though, with tax cuts.
    Here's what's going on in our economy, and it affects all 
of us, in rice and sugar and seafood and every other business. 
Our economy is growing at 1.6 percent. Now, you'll read in the 
paper that our unemployment rate is low, and it is, but that 
hides a lot of things. That low unemployment rate doesn't tell 
the full story of people who are working part-time that would 
like to work full-time. It doesn't tell the full story of the 
people who have given up looking for work. It doesn't tell the 
full story of people who are making the same amount of money 
today that they were making eight years ago. So that 
unemployment number, while low, is very, very, very misleading.
    If you go back--and the stagnation with our economy has 
been going on since 2008. Now, we had a really bad--I don't 
need to tell you--recession in 2008. But this is 2017. If you 
go back 30 years before 2008, average growth in our economy was 
about 3.1 percent. So normal growth for the American economy is 
3 percent, and we talk about it--some of my colleagues in 
Washington talk about it as if, ``Oh, gosh, if we got 3 
percent, we'd be setting records.'' That's just normal.
    The other problem we have is productivity growth. We 
normally grow at 2 percent productivity. We're growing at about 
1 percent. That's why wages aren't going up.
    The other reason I think that the economy is stagnated--
it's not the only reason. Of course, part of it here in 
Louisiana is oil, the price of oil. But putting that aside, 
businesswomen and businessmen are not investing their capital 
in new plants or new machinery or new equipment or new 
software, which means enough jobs aren't being created and 
which means productivity is not going up which means wages 
aren't going up. I think a big part of the reason for that is, 
first--we talked about it a little bit--over-regulation. These 
rules and regulations cost money. We've got 1.2 million rules 
and regulations, and some of them are a thousand pages long. I 
mean, it's just breathtaking.
    But the other problem, which we're going to tackle in the 
House and the Senate, is the tax system. We've done everything 
we can on what we call the monetary side, interest rates, to 
get the economy moving. We're only going to get the economy 
moving on what we call the fiscal side, and that's tax cuts.
    What I want to see us do is start--first, I want to see us 
get it done by November and make the cuts retroactive to the 
first of the year. That's what I want. I've got to convince 49 
of my colleagues to do that.
    [Laughter.]
    But I want to start with the business side. We have the 
highest business tax rates of all G20 developed countries, but 
not just for the large C corporations. I want to cut taxes for 
LLCs and LOBs and Sub S corporations and family farms and sole 
proprietorships, because that's where most of the jobs come 
from. I want to try to take a scalpel, if not an ax, to the 
capital gains tax, tax on dividends, tax on interest. I want to 
get rid of the estate tax. That's very burdensome for our 
family farms, and it's unfair. People have already paid tax on 
their assets. Why should they have to pay tax again?
    On the personal income side, I want to keep it simple. I 
could live with just taking all the different brackets and 
reducing the tax by 2 percent for each one. I want everybody to 
participate, not just those who--the top 1 percent. They're 
important, but I want to help the middle class primarily. We 
could do it by just raising the standard deduction. I just know 
that if we do it, we can get back to 3 percent. If we don't, 
we're going to have to learn to live with 1 and a half percent 
growth, and that's just anti-American.
    And what Washington--you don't have to be clairvoyant to 
see it. You see it from day one. There are too many people that 
have lost sight of the fact that people, businesswomen, 
businessmen, can spend their money better than government can, 
and the reason the economy--that's why the economy isn't 
growing. Government is taking too much.
    I want to thank you all for coming. I want to move quickly 
to our other two witnesses.
    All right, folks. Let's come back to order. I introduced 
Mr. Laroski and Ms. Melancon earlier, so I'm not going to do 
any more talking. I'm going to turn it over, and let's go first 
to Ms. Melancon.
    Let's come to order, folks, because this is going to be 
interesting.

STATEMENT OF HEIDI MELANCON, DIRECTOR, LOUISIANA SMALL BUSINESS 
   DEVELOPMENT CENTER, UNIVERSITY OF LOUISIANA AT LAFAYETTE, 
                         LAFAYETTE, LA

    Ms. Melancon. Senator Kennedy, thank you for the 
opportunity to testify today regarding small business and 
challenges that are faced by small business owners.
    My name is Heidi Melancon, and I am the Director of the 
Louisiana Small Business Development Center based at the 
University of Louisiana at Lafayette, which is one of the 
founding members of the Louisiana Network, which is made up of 
eight small business development centers hosted by universities 
across the State since 1983, and, in fact, our organization 
goes back to President Carter. He was the one that signed our 
organization into legislation in the 1970s, and they started 
rolling out the grants around 1983, and UL----
    Senator Kennedy. You all have done some great work, too.
    Ms. Melancon. Yes, at that point. The Small Business 
Development Center Network is part of a nationally accredited 
partnership between the universities, U.S. Small Business 
Administration, and in our State, Louisiana Economic 
Development. Furthermore, our network is a part of a national 
program that exists in all 50 states and territories of the 
U.S. So, in a sense, I do spend a lot of time educating the 
taxpayers about what Small Business Administration funds for 
our small business owners as well as on our State side.
    Since inception, the LSBDC has touched countless lives by 
helping entrepreneurs realize their dreams of building their 
business and generating jobs in our community through no-cost, 
confidential business consulting services, entrepreneurial 
programs, and business information and market research to 
develop and diversify Louisiana's economy. The LSBDC and our 
center is servicing the eight traditional parishes of Acadiana, 
which include Acadia, Evangeline, Iberia, Lafayette, St. 
Landry, St. Martin, St. Mary, and Vermilion, an area of over 
6,000 square miles, with three of us to do that work.
    In a typical year, the center provides business consulting 
to over 600 clients with around 55 percent of those being 
existing business owners. So, typically, in a period of a year, 
I can tell you where we are right now. We're at $20 million in 
capital of what we've helped companies thus far in this year.
    However, the downturn in our economy over the last three 
years has created an increase in demand for our services. In 
November of 2014, our office began to see a multitude of 
companies from all sectors, looking for opportunities for 
diversification due to that downturn in oil and gas prices. 
Furthermore, this was compounded by two natural flooding 
disasters that our State faced in 2016.
    It is without a doubt that clients were very interested in 
programs, and still are, that are offered by U.S. Small 
Business Administration, particularly certification programs 
that can assist with government contracting, such as Woman 
Owned Certification, the 8(a) Business Development Program, and 
HUB zone. These are very intricate programs that require 
someone to help business owners or people that are interested 
in these programs, taking them step by step, and we do that in 
our office, and as well as educational information available 
for exporting. That was a big concern for many people, because 
they're looking for new markets in the situation that they're 
in.
    I have worked in the SBDC Program for over 12 years, and I 
can attest that these small business programs have been 
paramount in assisting clients with diversification and access 
to new markets. With all good intentions that these programs 
provide, there are certain market and policy conditions that 
are very difficult for business owners to overcome, 
particularly for individuals that are wanting to start a new 
business.
    Many of my clients choose not to start a business due to 
several reasons, one being inadequate access to capital; 
onerous banking laws and policies; tax policy; and, by far, 
expensive healthcare--the minute they get the sticker price of 
what it's going to cost for them to purchase healthcare on 
their own, it kills the deal at that point--and a costly legal 
system and confusing employment laws. As mentioned before, our 
center has worked diligently to assist clients with strategic 
plans for diversification and sustainability in all industries. 
In concern for farmers and small businesses based in 
agriculture, they face the same challenges as stated above, as 
well as disrupted business models due to foreign competition 
and market pricing situations.
    For example, I recently worked with Mr. Jake Cormier from 
Church Point, Louisiana. He is a crawfish farmer and has been 
established since 2011. He recently opened C'est Bon Seafood as 
a means to curtail market conditions that he has faced in 
selling crawfish in our local market. He was assisted with the 
development of a business plan, a financial model, and market 
research in order to secure funding, which he did, for opening 
a retail operation in an adjacent State so that he could sell 
his Louisiana product and crop and not have to face the 
competition in yielding the price margins for sustainability. 
He developed that retail operation that will utilize his 
product, as well as other Louisiana products, that is thereby 
increasing his margin for his crop. This is just one example of 
many cases that we encounter of business owners having to 
overcome growing competition and challenging market conditions.
    Thank you once again for the opportunity to comment on this 
important issue, allowing me to highlight some of the 
challenges that business owners face as well as barriers to 
entry for new entrepreneurs.
    [The prepared statement of Ms. Melancon follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
      
    Senator Kennedy. Thank you, Heidi. I've got some questions, 
but we'll come back.
    Mr. Laroski.

STATEMENT OF JOSEPH A. LAROSKI, JR., SENIOR ADVISOR FOR POLICY 
    OFFICE OF THE UNDER SECRETARY FOR INTERNATIONAL TRADE, 
                         WASHINGTON, DC

    Mr. Laroski. Chairman Kennedy, thank you for the 
opportunity to speak to you today----
    Senator Kennedy. And thank you for coming.
    Mr. Laroski [continuing]. About our ongoing efforts to 
foster job creation for American businesses and farmers.
    The Department of Commerce's International Trade 
Administration is the primary U.S. government agency 
responsible for strengthening the competitiveness of U.S. 
industry in the global marketplace, promoting U.S. exports, 
monitoring compliance with U.S. trade agreements, and enforcing 
U.S. trade laws. ITA works to enhance the ability of American 
exporters to compete and win in international markets.
    We work closely with other Federal agencies and State and 
local partners to provide critical services and support to help 
U.S. businesses become export-ready, to promote American goods 
and services in international markets, and to connect U.S. 
companies to financing solutions to support their international 
businesses. ITA utilizes its network of trade promotion and 
policy professionals in Louisiana as well as 78 countries and 
100 other U.S. locations to assist small businesses and farmers 
and direct them to resources and services best suited to 
meeting their needs.
    While the ITA is not primarily responsible for agricultural 
exports and trade matters, it does frequently partner with and 
work alongside the U.S. Department of Agriculture and regional 
trade associations, such as the Southern United States Trade 
Association, to serve American businesses and farmers. In turn, 
the U.S. Department of Agriculture works with industry trade 
associations, such as USA Rice, to provide critical market 
intelligence and services to help businesses and farmers 
succeed in international markets.
    With respect to ITA's enforcement efforts, on June 30th, as 
was mentioned before, Secretary Ross signed amendments to the 
countervailing and antidumping duty suspension agreements on 
sugar from Mexico with the government of Mexico and with the 
sugar industry in Mexico that are designed to ensure that the 
agreements meet the requirements imposed by U.S. law and that 
the U.S. sugar industry receives the trade remedy relief for 
which it is entitled to under the law.
    These newly revised agreements address the injury from 
unfair subsidies that the Mexican sugar industry was found to 
receive and the dumping of Mexican sugar into the U.S. market. 
In addition to addressing the concerns of the U.S. sugar 
industry, the Department of Commerce determined that the 
amended agreements are in the public interest in part because 
they prevent disruptions and uncertainties in the market to the 
benefit of traders and consumers alike. Importantly, the 
amended agreements help ensure a level playing field for the 
U.S. sugar industry with enhanced monitoring and enforcement 
provisions and with stiff penalties for noncompliance. These 
provisions in the amended agreement work together to continue 
to promote stability in the U.S. sugar market in coordination 
with the U.S. Department of Agriculture's sugar program.
    In addition, since February 2005, the Department has 
imposed antidumping duties on imports of warm water shrimp from 
China, India, Thailand, and Vietnam. These duties apply to 
certain frozen warm water shrimp and prawns and resulted from 
petitions filed by a coalition of fishermen, shrimp farmers, 
and processors in the Gulf region. The Department continues to 
review the pricing practices of the foreign exporters of shrimp 
subject to these antidumping duty orders and works with our 
government partner agencies to share information to ensure that 
the enforcement regime works to maintain a level playing field 
for domestic fishermen, shrimp farmers, and processors.
    Over the last few years, the Department has worked closely 
with other Federal agencies to scale up its enforcement efforts 
in the shrimp industry. One example is following the enactment 
of the Trade Facilitation and Trade Enforcement Act, the 
Department has strengthened its collaboration with the Customs 
and Border Protection agency by sharing information on 
transshipment of shrimp through third countries. Moreover, the 
Department supports Customs and Border Protection Centers of 
Excellence, which help combat duty evasion with a 21st century 
approach to trade operations.
    Through its comprehensive suite of services and 
collaborative partnerships with public and private 
stakeholders, ITA strives to leverage resources and deliver 
services to U.S. companies effectively and efficiently.
    Thank you again for the opportunity to testify, and I look 
forward to answering your questions.
    [The prepared statement of Mr. Laroski follows:]
    
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    Senator Kennedy. Thank you, Joe.
    Let me ask you--what can Congress do, short-term, to try to 
help stimulate small business? Is it taxes? Is it regulations? 
Is it skilled workforce? Is it infrastructure?
    Ms. Melancon. I think when you were talking about the tax 
policy--I think that would make a difference, because in the 
situation of a small business owner, they're securing funding, 
so they get a limited amount from a bank, and before they even 
have a chance to get up and running, the compliance of the tax 
law squeezes them, but they only have so much working capital 
on hand. So they're stuck between the banking laws and then 
also having to comply--because they're treated the same as a 
company that's been in existence for five years, eight years. 
And unbeknownst to them, the employment laws that they've got 
to deal with, just on an employee--but they haven't even gotten 
started in the market.
    Senator Kennedy. It's pretty breathtaking.
    Ms. Melancon. So it's hard, because they can't get the 
capital to go forward. So in some cases, the money that they 
secure from a bank could go in the trash. I mean, if you look 
at all--what they borrowed--and we see it often in Lafayette--a 
business will open and before you know it, it's like, ``Oh, 
gosh, it's closed'' before it ever had a chance, because it 
just can't secure enough capital to overcome those barriers.
    Senator Kennedy. What about the access to capital? Is it 
there? I know as a result of Dodd-Frank, a lot of our smaller 
banks have had to spend so much of their profits on just 
complying with the Dodd-Frank regs.
    Ms. Melancon. They do.
    Senator Kennedy. But is the capital available?
    Ms. Melancon. You know, if a client had the personal 
situation to walk into a bank--so someone who is very well 
established--they're not going to have a problem. For those 
that have decent credit, but they lack collateral, the 
collateral side is really tough. But I have to say SBA has some 
very great guarantee programs that have been able to help a lot 
of our clients, even in our downturn, and I was very impressed 
with some of their products, what our clients were able to 
secure based on those guarantees. So I'm thankful for the 
products that we do have in place that are funded by Congress, 
because, otherwise, we wouldn't be able to do it.
    Senator Kennedy. What about skilled employees? I mean, I 
know with the downturn in oil and gas, there are a lot of folks 
looking for work.
    Ms. Melancon. Absolutely.
    Senator Kennedy. But is there a surplus? I mean, I assume 
there is.
    Ms. Melancon. I can see right now that people are turning 
to entrepreneurship to replace the job that they lost, and you 
can see it right when they're coming into the office, 
unbeknownst to them that, ``Oh, my gosh, you know what? I'm not 
really ready for entrepreneurship, but I don't have a choice.'' 
So, in that point, you can see the squeeze, and it's been going 
on for the last couple of years.
    But, yes, we have great talent. I think there's just so 
little time and funds in someone's business that they can take 
the time to train a person to where they need to be. They want 
the plug-and-play person, and so that kind of leaves some 
people in a squeeze.
    Senator Kennedy. You mentioned one other thing that really 
got my attention--the challenges on health insurance. Tell me 
about that.
    Ms. Melancon. Well, one of the goals for our organization 
is to target--they call them encore entrepreneurs, and that's 
someone that's about 50, looking to turn to entrepreneurship. 
When I talk about health insurance and where they can actually 
source their health insurance, and they think about how much 
it's going to cost out of their own pocket, it kills the deal. 
So I can see that entrepreneurship is being killed because of 
that as an aspect.
    Senator Kennedy. Well, the conundrum we got ourselves into 
is that to hire good employees, you've got to offer health 
insurance.
    Ms. Melancon. You do, yes.
    Senator Kennedy. It's no longer just a fringe benefit. It's 
a required benefit. The people who implemented the Affordable 
Care Act, so-called ObamaCare--they meant well.
    Ms. Melancon. Absolutely.
    Senator Kennedy. They meant well. It just didn't work. I 
mean, the whole idea was--I remember the debate. It was, okay, 
if you do this, health insurance is going to be cheaper, and 
it's going to be more accessible, and your life's going to be 
better. And it's not cheaper. It's gone through the roof, and, 
frankly, it's not more accessible.
    Ms. Melancon. And I saw two sides of it. If someone has 
health insurance, it's easy to say that ObamaCare, or the 
Affordable Healthcare Act, is not something that's very 
conducive for them. But if you're in a situation as an 
entrepreneur, and you have no other choices, of course, you 
want it to work because you don't--that's really all you have.
    Senator Kennedy. Sure.
    Ms. Melancon. So there are two sides to it when you look at 
it.
    Senator Kennedy. There are, and when you break it down--we 
just finished this debate, as you know, in the Senate. We fell 
one vote short. We will return to healthcare because, first, 
it's important, but, secondly, we won't have a choice. The 
Affordable Care Act just--it can't sustain itself. We're now 
spending--if you add up all the people who have been helped by 
the so-called ObamaCare, it's about 7 percent of the 
population. That's the people who buy insurance on the 
exchanges and the people who have Medicaid through the Medicaid 
expansion, and those are an important 7 percent of the American 
people.
    But in order to help those 7 percent, we're spending about 
$140 billion a year, and we had to screw the 93 percent. I 
mean, just the amount that health insurance--that established 
employers offer has gone through the roof. I mean, it just 
hasn't worked. It just hasn't worked.
    Some of my colleagues believe that the answer--I don't 
agree with them--they want a single source. They want the 
Federal Government to run everybody's--to be in charge of all 
health insurance, and they think the right answer is to 
regulate doctors and hospitals and nurses like they were 
utilities. I have never seen that work. You can go to any one 
of the G20 countries, the major developed countries, that have 
a single payer system, and they're all in trouble, and nobody's 
happy with what they have, and I can tell you the American 
people won't.
    I wish we could have passed--I'm biased, of course, because 
I helped draft it. But the bill that missed by one vote was not 
perfect, but it was a lot better than what we have, and we'll 
eventually get it done.
    Joe, my question for you is going to be pretty simple. What 
can Congress do to help you and help you all and your work? 
Because you do great work.
    Mr. Laroski. Well, thank you. In terms of enforcement, I 
think some of the changes that have already been made have been 
enormously helpful. In the past few years, we've had new 
legislation to create the facilitation of the Enforcement Act, 
one in particular, that gave our agency greater authority to 
hold the Chinese and any government and their exporters more 
accountable in our investigations under the antidumping counter 
bill treaty laws and tightened a number of loopholes in our 
practice to enable us to more robustly enforce our trade remedy 
laws.
    It also has created opportunities for us to collaborate 
more closely with Customs in rooting out duty evasion and 
circumvention of our borders. Those efforts have been well 
worth it, and we're grateful for the----
    Senator Kennedy. How can we streamline and make the WTO 
more efficient?
    Mr. Laroski. To make the WTO more efficient. Well, we fully 
participate in the WTO----
    Senator Kennedy. I know.
    Mr. Laroski [continuing]. And there are areas where the 
committee system of the WTO has been quite helpful in 
exchanging information about new measures and getting 
explanations from the governments before they pass those 
measures and seeking changes where we see areas of 
noncompliance with the rules at the WTO, or simply areas that 
are going to have consequences for our exporters.
    One area of concern has been some of the appellate body 
decisions that have come down in the area of trade remedy laws, 
and I think some of those decisions have been largely 
unfavorable to the U.S. system, and we continue to defend our 
system as vigorously as we can. But sometimes the decisions 
just don't have the rigor and support that I would hope to see 
in a body like that.
    Senator Kennedy. I want to thank both of you and our other 
experts. I want to thank everybody who came today. I have 
learned a lot. I'm going to take it back to my colleagues on 
the Small Business Committee. I want to thank everybody who 
helped us put this on. I have a lot to think about, and I hope 
you won't mind if my staff and I contact you to follow up on 
some of the issues, and our experts from our first panel.
    I want to thank the mayor and the council and the chief for 
their hospitality today. It's good to be back in Louisiana. I 
can tell you that. Thanks again to everybody who came.
    And with that, the hearing is adjourned.
    [Whereupon, at 2:33 p.m., the hearing was adjourned.]