[Congressional Record Volume 142, Number 24 (Tuesday, February 27, 1996)]
[House]
[Pages H1279-H1280]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             TRADE DEFICITS

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Indiana [Mr. Burton] is recognized for 5 minutes.
  Mr. BURTON of Indiana. Mr. Speaker, the Presidential campaigns, 
particularly the Republican primary campaign, is in the full swing 
right now, and there has been a lot of derogatory comments made by one 
candidate or another about their opponents.
  I think we have a good field of Republican candidates, and I wish 
they would quit the terrible rhetoric about one another and really 
stick to the facts. I think if they do that, the American people will 
find them to be the kind of people they want to elect President and 
will elect the nominee we can all live with and be happy with and can 
elect in November to the Presidency of the United States.
  One of the problems that I have is that there has been a lot of 
misinformation about one of the candidates, 

[[Page H1280]]
and I am not taking sides in this Presidential campaign at this point, 
but I would like to point out some of the inaccurate remarks that have 
been made in what I believe to be untrue statements.
  First of all, they say Pat Buchanan, one of the leading candidates 
for President, has been one who wants to put a wall around the United 
States and be a protectionist, and they say the manifestation of this 
is because he opposed NAFTA and a lot of the jobs going to Mexico and 
other parts of the world, and they have said that this is the wrong 
approach and that we should not be worrying about that.
  The fact of the matter is NAFTA has been a disaster, and Mr. Buchanan 
is not wrong.
  Let me give you some figures: In 1995, the U.S. trade deficit with 
the world was about $120 billion. That included a deficit of about $671 
billion with Japan, $40 billion with China, and the deficit with Mexico 
is now $16 billion. Two years ago, when we signed NAFTA, we had a $6 
billion trade surplus with Mexico. Now we have a $16 billion trade 
deficit. That means we have lost $22 billion in trade with Mexico in 
the last 2 years, and each one of those billions of dollars costs the 
people of this country 19,000 jobs.
  And so since NAFTA was passed, we have had a net loss of over 300,000 
jobs going to Mexico. A net loss of 300,000 jobs. I think that it is 
not inaccurate to say it is not in the best interests of the people of 
this country to have businesses and industries relocate in Mexico to 
the detriment of American workers because of an unfair trade agreement.
  Now, people say why do we have an unfair trade agreement? ``Why do 
you say that, Dan?'' The reason I say that is there are several 
problems with the NAFTA bill. Mr. Buchanan has talked about those. One 
of the problems is the tariffs on the Mexican side of the border come 
down over 15 years. On the American side of it's border, in many cases, 
those tariffs come down in 5 years. That gives the Mexican entrepreneur 
or business person a 10-year advantage, because they are still going to 
have tariffs on their side of the border for American products while we 
do not have them here.
  Now, the wage rates down there in some parts of Mexico are very, very 
low. You can employ people in the Yucatan, including fringe benefits, 
for a dollar an hour, and their counterpart in the United States is 
being paid anywhere from $10 to $20 an hour. That labor disparity is 
one reason to go down there.
  In addition to that, the tariffs not coming down as quickly on the 
Mexican side also is an inducement for American industry to leave here 
and go down there. Why would a small labor-intensive industry, let us 
say, that manufactures microwave ovens want to stay here when their 
competition is in Mexico at much lower wage rates, selling into the 
United States with no tariffs while they are paying much higher wage 
rates here in the United States and they cannot sell into Mexico 
without an import tariff? And so there is a real disadvantage for 
American industries staying here instead of going south of the border. 
Mr. Buchanan talks about that, and it is something that has cost us, as 
I said, over 300,000 jobs.
  Let me give you some figures: Imports from Mexico have increased 51 
percent; that is, products coming from there to here. United States 
exports going to Mexico have increased by only 8 percent. So they have 
got a 33 percent advantage there. The $5.7 billion trade surplus I 
talked about in 1992 is now a $16 billion trade deficit, costing 
300,000 jobs. The companies along the border are relocating in Mexico 
because of these advantages. More workers, in 90 percent of the cases, 
let me just read this to you, at this rate, taking Japan and China, for 
example, excuse me, while large corporations made sweeping predictions 
that NAFTA would enable them to hire more workers, in 90 percent of the 
cases these companies who said they would be able to hire more workers 
because of NAFTA have made no significant steps toward fulfilling these 
promises. In fact, according to the Department of Labor estimates, many 
of these leading NAFTA promoters have laid off workers, including GE, 
Procter & Gamble, Mattelle, and Xerox. For example, Wrangler has closed 
three manufacturing plants, lost 700 jobs to Mexico. United 
Technologies automotive plant in St. Mathews, SC, laid off 400 workers 
to plants in Mexico. Cleveland Mills, owned by Fruit of the Loom, 
folded in December, eliminating 400 jobs. This is part of the Fruit of 
the Loom plans to cut 3,200 jobs, close six plants and move those 
operations to other parts of the world, including Mexico. Eleven El 
Paso apparel factories closed down in the first year alone because of 
NAFTA, and recently the Hershey Co., an all-American company, everybody 
loves those Hershey Kisses, they moved one of their major Hershey 
Kisses plants to Mexico, and this is just another reason why facts need 
to be laid out very clearly in this campaign, and we should not be 
denigrating any one candidate to the advantage of another, because of 
misinformation.

  Mr. Buchanan is right on the money on this issue. We are losing jobs. 
There needs to be free trade, but there needs to be fair trade as well, 
and so I hope my colleagues that are running for President will keep 
this in mind.

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