[Congressional Record Volume 143, Number 140 (Thursday, October 9, 1997)]
[Extensions of Remarks]
[Pages E2004-E2005]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      WHY I SUPPORT ``FAST TRACK''

                                 ______
                                 

                        HON. DONALD A. MANZULLO

                              of illinois

                    in the house of representatives

                       Thursday, October 9, 1997

  Mr. MANZULLO. Mr. Speaker, many people have diverse opinions on the 
issue of fast track and its potential impact in a wide range of areas. 
I wanted to take this opportunity to define fast track and explain what 
it is intended to do and what it is not designed to do.
  Fast track is simply the process by which Congress provides limited 
authority to the President to enter into more trade negotiations in 
order to lower barriers to our U.S. exports. All fast track does is 
allow the President the ability to negotiate these trade agreements and 
then present the agreement to Congress for a final ``yes'' or ``no'' 
vote on the entire package without adding or taking away specific words 
or sections from the agreement. During the negotiations and the 
drafting of the final agreement, fast track mandates that there is 
sufficient consultation with Congress so that the President will not 
present an agreement that does not have the support of a majority in 
Congress. That, simply, is fast track, nothing more, nothing less.
  Fast track is not a new concept. It has been a common practice for 
over 60 years, in some form, for every President since Franklin 
Roosevelt as tariffs became less and less a source of revenue for the 
U.S. Government and foreign trade policy grew in complexity and 
importance to the U.S. economy. The Reciprocal Trade Agreement Act of 
1934 was the first time Congress delegated to the President the broad 
authority to set, within specific limits and for a limited time, tariff 
and other foreign trade policy.
  Up until 1945, 32 bilateral tariff-reducing agreements were reached. 
In 1947, the United States became a founding member of the multilateral 
General Agreement on Tariffs and Trade [GATT], whose aim is a mutual 
reduction of barriers to trade among all the free market nations of the 
world. During this time, Congress extended the 1934 act 11 times to 
open up more markets to U.S. products by lowering tariffs.
  Then, in 1962, Congress gave President Kennedy a 5-year authority to 
participate in the first major GATT round or negotiation to not just 
lower tariffs but eliminate duties on specific products. These global 
trade talks became more commonly known as the Kennedy round, named 
after his untimely death.
  The Kennedy round concluded in 1967 when agreements were reached to 
reduce not only tariffs but, for the first time, non-tariff or redtape 
barriers. But more controversial, the executive branch, under President 
Johnson, also negotiated an international antidumping agreement that 
was not contained within the authority Congress originally gave 
President Kennedy. Congress subsequently enacted a law in 1968 
nullifying any provision of this antidumping agreement that was not 
consistent with U.S. law.
  Because of this dispute between the executive and legislative branch, 
a compromise was reached after a 7-year period when there were no 
significant global trade barrier reduction negotiations. Thus, the fast 
track procedures were formally adopted for the first time as part of 
the Trade Act of 1974. This legislation granted then President Ford 
another 5-year time period to negotiate a further reduction in trade 
barriers. These talks became more commonly known as the Tokyo round of 
the GATT. This round eventually produced a package of 14 international 
trade agreements that eventually became part of the Trade Agreements 
Act of 1979, negotiated by President Carter.
  As part of this renewed fast-track authority, the executive branch 
agreed to more closely consult with Congress, even to the point of 
accrediting 10 Members of Congress to serve as advisors to trade 
negotiating teams. But, in return, Congress agreed not to amend or 
change the final agreement. Countries will not negotiate with the 
United States until they are assured that the final agreement will not 
be changed. However, the legislative branch established an informal 
process with the executive branch, from the beginning of the 
negotiating process to crafting the implementing legislation, that the 
final agreement reflects the will of a majority of Congress.
  Fast track was further extended again to President Reagan as part of 
the Trade and Tariff Act of 1984. Thus, the U.S.-Israel Free

[[Page E2005]]

Trade Agreement in 1985 and the U.S.-Canada Free Trade Agreement in 
1988 was negotiated and enacted into law under this authority.
  Fast track was extended again to President Reagan as part of the 
Omnibus Trade and Competitiveness Act of 1988. This authority allowed 
him and, subsequently Presidents Bush and Clinton to negotiate and 
enact the North American Free-Trade Agreement [NAFTA] in 1993 and the 
third major GATT agreement, otherwise known as the Uruguay round, in 
1994.
  Thus, President Clinton's fast-track proposal is nothing new. It has 
been used by 11 Presidents of both political parties for over the last 
60 years. The previous fast-track authority expired in 1994. In the 
specific proposal before Congress, the President would be given until 
2001, which can be extended until 2005 unless one House of Congress 
disapproves, the ability to negotiate further reductions to trade 
barriers around the world.
  Once again, fast track does not take any power away from Congress. In 
fact, this procedure requires constant congressional review and input 
throughout each stage of the process from deciding which country to 
negotiate with to proposing the final legislative bill to implement the 
agreement. No President will submit a trade agreement that has not been 
thoroughly analyzed and supported by a majority in Congress. Without 
fast track, we would never have any more major agreements.
  That's why I support providing any President, regardless of party 
affiliation, the ability to enter into comprehensive trade agreements 
to help boost our exports as long as the negotiations stick closely to 
resolving trade problems, not unrelated issues. Most observers believe 
Chile would be the next logical candidate to enter a free-trade 
agreement with the United States.
  A free-trade agreement with Chile will be very beneficial to the 
United States. The average tariff or tax on United States exports to 
Chile is 11 percent. Yet, the average tariff rate for Chilean imports 
into the United States is less than 1 percent. Essentially, Chile 
already has a one-sided free-trade zone with the United States. 
Obviously, a free-trade agreement with zero tariffs on both sides is of 
greater benefit to the United States.
  Chile has already entered into a variety of free-trade agreements 
with other nations, such as Canada and Mexico. There are documented 
cases when U.S. workers lost approximately $500 million in export 
opportunities in 1996 to foreign competitors because the U.S. product 
had an 11-percent tax added on top of the base price. For example, 
workers at a major United States telecommunications firm lost the 
opportunity to help rebuild Chile's phone system to Northern Telecom of 
Canada because of the lack of a free-trade agreement with the United 
States. With fast-track authority, we can knock down these trade 
barriers, not just with Chile but with other countries and in specific 
sectors such as agriculture, automobiles, and environmental technology 
to help United States workers make products that will be sold abroad.
  I understand that many oppose fast track because they sincerely 
believe that this vote serves as a referendum on the North American 
Free-Trade Agreement [NAFTA]. Many opponents of fast track believe that 
NAFTA has cost the United States hundreds of thousands of jobs. First, 
the analysis is based on a false assumption that any trade deficit 
automatically translates into job loss. In some cases, imports create 
job opportunities here at home, from longshoremen to clerks in retail 
stores. In other cases, goods are imported into the United States for 
final assembly for consumption here or exported abroad. Thus, no one 
should assume that because there is a trade deficit with a certain 
country, then that automatically translates into U.S. job loss. If that 
were the case, then oil producing countries like Saudi Arabia and 
Venezuela would be the greatest displacer of United States jobs because 
oil imports comprise most of our global trade deficit.
  In the specific case of Mexico, it is important to remember that 
NAFTA actually prevented a bad situation from turning worse. United 
States exports to Mexico suffered a decline in 1995 because of the peso 
devaluation and the ensuing economic downturn, which had nothing to do 
with NAFTA.
  A less serious economic crisis affected Mexico during the early 
1980's but the impact on United States exports was much greater than 
1995. Mexico's economic growth rate dropped by a significant 7 percent 
in 1995 as compared to a growth rate decrease of 0.6 percent in 1982 
and 4.2 percent in 1983. United States exports to Mexico dropped by 35 
percent in 1982 and 24 percent in 1983. However, in 1995, United States 
exports to Mexico decreased by only 13 percent. Why? Because Mexico 
honored the tariff reduction commitments it made in 1993 as part of 
NAFTA.
  In 1982, Mexico responded to its economic downturn by raising tariffs 
and other import barriers against United States products to protect 
their industries. But in 1995, while Mexico significantly raised 
tariffs and trade barriers against other nations not part of NAFTA such 
as Europe and Japan, Mexico did not do so against the United States and 
Canada because that action would have violated NAFTA. Thus, while 
United States exports to Mexico dropped off by half in the early 
1980's, they only decreased by 13 percent in 1995 during a much more 
severe economic crisis thanks to legal protections contained in NAFTA. 
In other words, whatever United States job loss can be associated with 
trade with Mexico after NAFTA would have been much greater in 1995 if 
NAFTA was not in place. Thus, NAFTA prevented the loss of more United 
States jobs because under the terms of NAFTA, Mexico was prohibited 
from raising tariffs and more red-tape regulations to restrict U.S. 
exports.
  While many northern Illinois exporters faced a rocky road with Mexico 
in 1995, prospects now look brighter. I see news headlines such as: 
``Midwest Boom Fueled by Mexico Trade,'' ``Spurred by NAFTA, Illinois 
Exports Finally Rebound,'' and ``NAFTA's Impact on Jobs Has Been 
Slight, Study Says.'' I have heard from many companies in the 16th 
District of Illinois whose workers have specifically benefited because 
of the increased openness in Mexico thanks to NAFTA. For example, 
Eclipse Corp. closed up their factory in Mexico and relocated 
operations back to Rockford because NAFTA now allows their product to 
be shipped much more easily into Mexico.
  But regardless of anyone's position on NAFTA, opposing fast track 
will not do anything to solve any remaining trade problems the United 
States has with Mexico. To defeat fast track will not stop United 
States companies from moving their factories to Mexico or slow down 
Mexican imports into the United States. It is very important to 
remember this because many who oppose fast track sincerely believe 
defeating this initiative will stop these practices.
  In conclusion, Mr. Speaker, I support fast track as one tool in our 
trade arsenal to help lower barriers around the world to U.S. exports. 
I have been fighting to make sure that our trade policy has all tools 
at its disposal, from antidumping laws, which helped Brake Parts of 
McHenry keep 400 jobs by fighting off unfair competition from 
unscrupulous Chinese brake rotor manufacturers, to the Export-Import 
Bank of the United States, which allowed Beloit Corp. with a 
manufacturing facility in Rockton, IL, keep 2,000 union workers 
employed along the Wisconsin-Illinois stateline border by providing a 
major loan to help sell two large, fine papermaking machines to 
Indonesia.
  Mr. Speaker, fast track is simply another method to help break down 
trade barriers so that workers and farmers in the 16th District of 
Illinois can continue to build and grow products that will be shipped 
around the world. We cannot rest on our laurels during these good 
economic times, which have been caused, to a large degree, by the 
growth in U.S. exports, as we enter the next millennium. We need 
continued, further progress on the global elimination of barriers to 
U.S. exports. There is much more work that needs to be done. That's why 
we need fast track.

                          ____________________