[Congressional Record Volume 140, Number 138 (Wednesday, September 28, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: September 28, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]


                              {time}  1820
 
                    REGRETTABLY, NAFTA ISN'T WORKING

  The SPEAKER pro tempore (Mr. Scott). Under the Speaker's announced 
policy of February 11, 1994, and June 10, 1994, the gentleman from 
Michigan [Mr. Bonior] is recognized for 60 minutes as the designee of 
the majority leader.
  Mr. BONIOR. Mr. Speaker, there's an old story my grandfather used to 
love to tell about the time he immigrated from Ukraine to Hamtramck, 
which is a small enclave within the city of Detroit.
  The town was filled with Polish and Ukrainian immigrants. And one 
time one of the people from the old country robbed a bank. He was 
caught right away, but he didn't have the money on him. And he didn't 
speak a word of English.
  The police chief got an interpreter, sat them both down in the jail, 
and told the interpreter, ``Ask this man where the money is.''
  The interpreter asked, but got no answer.
  The chief took out his gun, placed it on the table, and said: ``You 
tell this guy he better answer or he's in big trouble.''
  The interpreter asked again, but again, he got no answer.
  Finally, the chief picked up the gun, pointed it at the bank robber's 
forehead and said, ``You tell this guy he better talk or he'll be 
sorry.''
  The interpreter delivered the message, and this time the robber said 
in Polish: ``I confess. I stole $100,000 and dropped the money in a dry 
well behind the bank. The money's there.''
  The interpreter thought for a moment, turned to the chief and said: 
``The robber says he's not afraid to die.''
  Mr. Speaker, I think of that story a lot whenever I think about the 
North American Free-Trade Agreement--whenever I hear the way it's being 
interpreted.
  Mr. Speaker, last fall at this time, many of us in this House opposed 
NAFTA because we thought it was a bad deal for American workers and 
American jobs.
  We felt that the American people deserved a better deal, one that 
would increase the standard of living in this country while raising 
Mexico's standard to our level.
  One that would stick up for the rights of working families while 
doing more to improve the human rights situation in Mexico.
  We thought we could do better. But as we all know, Mr. Speaker, NAFTA 
passed. It's now the law of the land.
  And now that it is the law, we all hope that it works. We all hope 
that it will help American families and not hurt them.
  And indeed, now that we've passed the 6-month mark of this treaty--if 
you listen to interpretations of NAFTA by the Commerce Department and 
others who supported this agreement--it's clear some believe it is 
working.
  But I am concerned, Mr. Speaker.
  I am concerned that many of the interpretations I have seen by the 
Commerce Department and others recently take the same tact they did 
last year during the NAFTA debate: they only looked at half of the 
story.
  While we all hope that NAFTA works--until we're honest with ourselves 
and look at both sides of the story--we have to recognize that it never 
will work.
  We are here tonight, Mr. Speaker, to talk about the other side of the 
story. The side of the story we must pay attention to if this treaty 
really is going to be a boon to America.
  Let me talk about why I find the recent claims of the Commerce 
Department extremely misleading.
  They point out that United States exports to Mexico are up 17 
percent. What they don't say is that imports from Mexico are up 21 
percent, and that's cost us jobs.
  They point out that the United States has exported 22,000 vehicles to 
Mexico from January to July. What they don't say is that we have 
imported 221,000 vehicles from Mexico--10 times more than we sent 
them--and that's cost us jobs.
  They claim that NAFTA could create 100,000 jobs this year, with no 
supporting documentation. What they don't say is that 35,000 workers 
from 224 firms in 37 States have already applied for benefits due to 
jobs lost from NAFTA and that's just through August.
  Using the logic of the Commerce Department report, you would conclude 
that the 1962 New York Mets were a good baseball team because they won 
40 games. Their NAFTA math lets you overlook the fact that the 1962 
Mets lost 120 games, and that's why they're known as one of the worst 
teams in baseball history.
  When you look at both sides of the story, it's easy to understand why 
our trade surplus with Mexico has dropped by over 30 percent in the 
past year alone. It's gone from $1.6 billion to $1 billion--and headed 
in the wrong direction fast.
  In fact, I believe we really need to take a look at our entire trade 
policy.
  In trade figures that just came out last week--at the same time 
they're trying to sell us good news about NAFTA--our overall trade 
deficit recently rose to the second-highest level in history. It surged 
to over $10 billion in July.
  Our deficit with Japan alone soared to $5.67 billion for the month of 
July--adding to the $60 billion annual deficit they held over us last 
year. Our deficit with China reached $2.67 billion in the same period.
  We can't keep closing our eyes to both sides of the story. We can't 
keep listening to the happy talk while closing our eyes to the other 
side of the story. It's time we get real.
  Clearly, the deficit is a disturbing trend. But an equally disturbing 
trend is emerging among our top auto competitors that should concern us 
all.
  Again, this wasn't discussed at all in the Commerce Department 
report, but it's something we have to watch closely.
  Last year, there were many of us who warned that once NAFTA passed, 
our top auto competitors would use Mexico as an export platform into 
the United States.
  Since NAFTA eliminates tariffs between the United States and Mexico, 
we feared that countries such as Japan, Korea, and Germany would set up 
shop in Mexico in order to export cars into the United States duty-
free, in effect, skirting the existing tariffs we charge those 
countries to import cars into our country which would further erode our 
balance of trade.
  That was our concern and regrettably, it appears to be exactly what's 
happening.
  In the short time since NAFTA passed, several major Japanese and 
European automakers have announced plans to build or expand production 
in Mexico.
  Since NAFTA passed, Honda has announced plans to construct a $50 
million plant in Guadalajara that will begin assembling Honda Accords 
in November of next year.
  BMW has revealed plans to invest $180 million to begin operations in 
a plant just west of Mexico.
  Nissan recently opened a new plant in Mexico as part of a 6-year, $1 
billion plan to double its production capacity in North America.
  Volkswagen only sold 50,000 cars in the U.S. last year.
  Now, after NAFTA, they plan to boost production in Mexico and vow, 
and I quote, ``to sell more than 100,000 cars'' in the United States 
this year.
  Even Toyota President Tatsuro Toyoda, who has never even exported 
cars to Mexico before, was recently reported in Automotive News to be 
quote, ``interested in Mexico as a possible production base, following 
the implementation of NAFTA.''
  And it's not just foreign auto companies that are moving to Mexico. 
Samsung of Korea just announced this month that it would start building 
a $150 million electronics plant in Tijuana.
  And listen to the reason why. When a Korean Government economist was 
asked ``why Mexico,'' he didn't say, ``because we want to sell more 
products to Mexican consumers.'' He responded that quote, ``Latin 
America is very important (because) it provides easier access to North 
America markets.''
  Meanwhile, our automotive trade in the first 9 months of NAFTA has 
followed the same unhealthy pattern that was set before NAFTA.
  We sell them parts, they turn those parts into finished vehicles and 
then they ship them back to us.
  When you look at the Commerce Department's own figures, you find that 
ranked in dollar value, our No. 1 manufactured export to Mexico is auto 
parts, while our No. 1 manufactured import from Mexico is finished 
vehicles.
  What's the benefit of our exports to Mexico if they come right back 
across the border to us and never reach the Mexican consumer?
  And why can't workers in the United States assemble those cars just 
like we have for over 100 years?
  The more we ignore the reality of these numbers, the more we put the 
jobs of our own workers in jeopardy.
  Finally, Mr. Speaker, let me describe to you a case which I believe 
calls into question the depth of our commitment to the side agreements 
that were signed to get NAFTA passed.
  If you recall, Mr. Speaker, last year the administration negotiated 
two separate side agreements--one on the environment and one on labor 
rights--that everyone agreed were vital to getting the treaty passed.
  As part of the labor side agreement, our Government committed itself 
to helping enforce workers rights in Mexico.
  We committed ourselves to challenging Mexico to live up to the letter 
of their own law and promised to take immediate action if any 
violations were reported.
  Well, earlier this year, there was a case that tested that 
commitment.
  Shortly after NAFTA went into effect, 11 workers at a General 
Electric Plant in Juarez and 20 workers at a Honeywell plant in 
Chihuahua were fired.
  The reason? Because they were trying to organize a union. Working 
conditions in one of the plants were so dangerous that workers 
consistently came down with headaches and nausea and so, they spoke out 
about it.
  They met in their own homes and tried to organize a union just like 
workers in the other plant.
  And for that, they were fired.
  The treatment of these workers were in clear violation not only of 
Mexico's own domestic laws, but of the labor side agreement of NAFTA.
  Because these workers had been in contact with organizers from 
several American unions, those unions submitted a formal complaint to 
the Labor Department.
  Under NAFTA, the Labor Department is responsible for investigating 
their claims and the Labor Department agreed to hold a hearing.
  Since this was the first hearing of its sort, it was to set an 
important precedent.
  But if the precedent it set is any indication of how stringently 
we're going to enforce NAFTA, we all have reason to be concerned.
  First, the hearing was scheduled to be held not in El Paso--which was 
the U.S. site nearest to the complaints--but in Washington, which most 
of the witnesses could not afford to travel to.
  Then, the hearing was scheduled for August 31. But anyone wishing to 
testify had to submit written testimony by August 19th--which happened 
to be 2 days before the biggest election in Mexican history, which most 
of the witnesses were participating in. So there was no time to 
prepare.
  After numerous letters from members of Congress to protest the date, 
it was finally moved to September 12.
  But the hearing limited testimony to 10 minutes per person, including 
translation time--which actually cut the testimony down to 5 minutes 
per person. This for people who had traveled thousands of miles to make 
their case.
  Four panels spoke. But there were no questions asked of the first or 
fourth panels, and only limited questions of the third panel.
  What's more, cameras, tape recorders, and videotaped testimony was 
not permitted, which completely limited public access.
  And while the Labor Department said transcripts would be made 
available within 3 days, they now say they are making none available. 
If you want one, you have to call the recording company.
  It took my office over 2 weeks to get a copy.
  Mr. Speaker, I think you would agree, this is not a good precedent to 
set. And if this is any gauge about our commitment to the side 
agreements, we all need to be concerned.
  Mr. Speaker, last year, we fought for a better NAFTA agreement.
  Now, that's its law, we all hope that it works.
  But until we're honest with ourselves, until we look at both sides of 
the story, and work to honor the commitments that we made, it never 
will work.

                              {time}  1830

  Mr. Speaker, I call upon everyone to join in making sure that it does 
work.
  Mrs. BENTLEY. Mr. Speaker, the demand in this nation for humane law, 
and the expectation of fair and equal treatment for all Americans, has 
made many of us naive in dealing with nations rooted in other 
traditions, other value systems, other legal structures.
  The lack of fair treatment of Mexican labor whether by their 
employers or by their representatives to the NAFTA or by our NAFTA 
representative's inability to move the Government of Mexico toward a 
more humane attitude toward its own citizens should not come as a 
surprise.
  Under what special power can the long, dark history of civil rights 
violations in Mexico be changed? By the mere shipping of a tripartite 
trade agreement such as NAFTA?
  I think not.
  In one of the poorest nations of the world, which counts among its 
elite 30 billionaires--more than are counted in any one of the 
industrialized nations--most of them created since Mexico privatized 
many of its national industries during the 1980's--the notion of 
expecting that individual human rights would be upheld above all 
considerations of making money is rather farfetched.
  A commentary upon the difficulty of dealing with the laws of the 
various nations through the dispute panel mechanism central to every 
one of these major trade agreements, including the proposed GATT, was 
made most brilliantly by retired U.S. Circuit Judge Malcolm Wilkey 
regarding the decision by the Extraordinary Challenge Commission of the 
Canadian Free Trade Agreement on exports of soft wood lumber products 
into the United States.
  Representing the United States on the ECC appeal against Canadian 
subsidies of soft wood lumber, Judge Wilkey, outvoted 2 to 1, clearly 
stated the dangers inherent in the dispute panel process:

       It is clear that a new body of United States law, fathered 
     by Binational Panels and ECCs under the CFTA (soon NAFTA), 
     will be created, while long-established U.S. law will 
     continue to be applied to imports from all other countries. 
     All of this has occurred in the operation of this innovative 
     scheme of appellate review between Canada and the United 
     States, two common law countries with similar traditions and 
     antecedents. Now we have Mexico as a third member of NAFTA, 
     and in the near future perhaps Chile and other Ibero-American 
     countries. Mexico has no legal system or traditions in common 
     with the United States whatsoever; it is proudly a Civil Law 
     country. . . . If Canadians on the Panels and ECCs have 
     failed--as in my judgement here they have--to comprehend the 
     United States standards of judicial review of administrative 
     agency action, what can we expect from lawyers and judges 
     schooled in the Civil Law?

  Mr. Speaker, what can we expect also from the more than 120 nations 
in the GATT who will have power over our domestic laws equal to that 
which we have given Canada and Mexico? Nations as unaccustomed to 
freedom and civil rights as China and Sri Lanka, Russia and Malaysia.
  Will our higher standards in every phase of our every day life appear 
to them to be nothing more or less than structural impediments to the 
free flow of their goods into our markets?
  Of course they will. Just as Venezuela is going to charge before the 
GATT that our standards for clean gasoline were designed just to keep 
their lower standard of gasoline out. And, never forget, that this 
administration was prepared to give Venezuela a waiver under the threat 
of a challenge to the old toothless GATT, until the Senate stopped that 
nonsense. Imagine how far Mr. Kantor will roll under a GATT with 
enforcement powers if the Venezuelan challenge is upheld.

  And we are being told we have nothing to fear if the new GATT passes.
  Ask the workers in the GE plant and the Honeywell plant how much 
better life is for them now that the NAFTA is going into effect. 
Obviously not much.
  These agreements are not good deals for America. They seem to not be 
helping the workers in these other nations and they will be devastating 
to the jobs of American workers. They will ultimately strip the 
Congress of all of its powers guaranteed in the Constitution over the 
whole body of U.S. interstate and foreign commerce law.
  We should have voted no on NAFTA. we must vote no on GATT.

                          ____________________