[Congressional Record Volume 143, Number 152 (Tuesday, November 4, 1997)]
[House]
[Pages H9873-H9881]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
UNITED STATES-CARIBBEAN TRADE PARTNERSHIP ACT
Mr. CRANE. Mr. Speaker, I move to suspend the rules and pass the bill
(H.R. 2644) to provide to beneficiary countries under the Caribbean
Basin Economic Recovery Act benefits equivalent to those provided under
the North American Free Trade Agreement.
The Clerk read as follows:
H.R. 2644
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``United States-Caribbean
Trade Partnership Act''.
SEC. 2. FINDINGS AND POLICY.
(a) Findings.--The Congress makes the following findings:
(1) The Caribbean Basin Economic Recovery Act represents a
permanent commitment by the United States to encourage the
development of strong democratic governments and revitalized
economies in neighboring countries in the Caribbean Basin.
(2) The economic security of the countries in the Caribbean
Basin is potentially threatened by the diversion of
investment to Mexico as a result of the North American Free
Trade Agreement.
(3) Offering NAFTA equivalent benefits to Caribbean Basin
beneficiary countries, pending their eventual accession to
the NAFTA or a free trade agreement comparable to the NAFTA,
will promote the growth of free enterprise and economic
opportunity in the region, and thereby enhance the national
security interests of the United States.
(4) Countries in the Western Hemisphere offer the greatest
opportunities for increased exports of United States textile
and apparel products.
(5) Given the greater propensity of countries located in
the Western Hemisphere to use United States components and to
purchase United States products compared to other countries,
increased trade and economic activity between the United
States and countries in the Western Hemisphere will create
new jobs in the United States as a result of expanding export
opportunities.
(b) Policy.--It is the policy of the United States--
(1) to offer to the products of Caribbean Basin partnership
countries tariffs and quota treatment equivalent to that
accorded to products of NAFTA countries, and to seek the
accession of these partnership countries to the NAFTA or a
free trade agreement comparable to the NAFTA at the earliest
possible date, with the goal of achieving full participation
in the NAFTA or in a free trade agreement comparable to the
NAFTA by all partnership countries by not later than January
1, 2005; and
(2) to assure that the domestic textile and apparel
industry remains competitive in the global marketplace by
encouraging the formation and expansion of ``partnerships''
between the textile and apparel industry of the United States
and the textile and apparel industry of various countries
located in the Western Hemisphere.
SEC. 3. DEFINITIONS.
As used in this Act:
(1) Partnership country.--The term ``partnership country''
means a beneficiary country as defined in section
212(a)(1)(A) of the Caribbean Basin Economic Recovery Act (19
U.S.C. 2702(a)(1)(A)).
(2) NAFTA.--The term ``NAFTA'' means the North American
Free Trade Agreement entered into between the United States,
Mexico, and Canada on December 17, 1992.
(3) Trade representative.--The term ``Trade
Representative'' means the United States Trade
Representative.
(4) WTO and wto member.--The terms ``WTO'' and ``WTO
member'' have the meanings given those terms in section 2 of
the Uruguay Round Agreements Act (19 U.S.C. 3501).
SEC. 4. TEMPORARY PROVISIONS TO PROVIDE NAFTA PARITY TO
PARTNERSHIP COUNTRIES.
(a) Temporary Provisions.--Section 213(b) of the Caribbean
Basin Economic Recovery Act (19 U.S.C. 2703(b)) is amended to
read as follows:
``(b) Import-Sensitive Articles.--
[[Page H9874]]
``(1) In general.--Subject to paragraphs (2) through (5),
the duty-free treatment provided under this title does not
apply to--
``(A) textile and apparel articles which were not eligible
articles for purposes of this title on January 1, 1994, as
this title was in effect on that date;
``(B) footwear not designated at the time of the effective
date of this title as eligible articles for the purpose of
the generalized system of preferences under title V of the
Trade Act of 1974;
``(C) tuna, prepared or preserved in any manner, in
airtight containers;
``(D) petroleum, or any product derived from petroleum,
provided for in headings 2709 and 2710 of the HTS;
``(E) watches and watch parts (including cases, bracelets
and straps), of whatever type including, but not limited to,
mechanical, quartz digital, or quartz analog, if such watches
or watch parts contain any material which is the product of
any country with respect to which HTS column 2 rates of duty
apply; or
``(F) articles to which reduced rates of duty apply under
subsection (h).
``(2) NAFTA transition period treatment of certain textile
and apparel articles.--
``(A) Equivalent tariff and quota treatment.--During the
transition period--
``(i) the tariff treatment accorded at any time to any
textile or apparel article that originates in the territory
of a partnership country shall be identical to the tariff
treatment that is accorded at such time under section 2 of
the Annex to an article described in the same 8-digit
subheading of the HTS that is a good of Mexico and is
imported into the United States;
``(ii) duty-free treatment under this title shall apply to
any textile or apparel article that is imported into the
United States from a partnership country and that--
``(I) is assembled in a partnership country, from fabrics
wholly formed and cut in the United States from yarns formed
in the United States, and is entered--
``(aa) under subheading 9802.00.80 of the HTS; or
``(bb) under chapter 61, 62, or 63 of the HTS if, after
such assembly, the article would have qualified for treatment
under subheading 9802.00.80 of the HTS, but for the fact the
article was subjected to bleaching, garments dyeing, stone-
washing, enzyme-washing, acid-washing, perma-pressing, oven-
baking, or embroidery; or
``(II) is knit-to-shape in a partnership country from yarns
wholly formed in the United States;
``(III) is made in a partnership country from fabric knit
in a partnership country from yarns wholly formed in the
United States;
``(IV) is cut and assembled in a partnership country from
fabrics wholly formed in the United States from yarns wholly
formed in the United States; or
``(V) is identified under subparagraph (C) as a handloomed,
handmade, or folklore article of such country and is
certified as such by the competent authority of such country;
and
``(iii) no quantitative restriction or consultation level
may be applied to the importation into the United States of
any textile or apparel article that--
``(I) originates in the territory of a partnership country,
or
``(II) qualifies for duty-free treatment under subclause
(I), (II), (III), (IV), or (V) of clause (ii).
``(B) NAFTA transition period treatment of other
nonoriginating textile and apparel articles.--
``(i) Preferential tariff treatment.--Subject to clause
(ii), the President may place in effect at any time during
the transition period with respect to any textile or apparel
article that--
``(I) is a product of a partnership country, but
``(II) does not qualify as a good that originates in the
territory of a partnership country or is eligible for
benefits under subparagraph (A)(ii),
tariff treatment that is identical to the in-preference-level
tariff treatment accorded at such time under Appendix 6.B of
the Annex to an article described in the same 8-digit
subheading of the HTS that is a product of Mexico and is
imported into the United States. For purposes of this clause,
the `in-preference-level tariff treatment' accorded to an
article that is a product of Mexico is the rate of duty
applied to that article when imported in quantities less than
or equal to the quantities specified in Schedule 6.B.1,
6.B.2., or 6.B.3. of the Annex for imports of that article
from Mexico into the United States.
``(ii) Limitations on all articles.--(I) Tariff treatment
under clause (i) may be extended, during any calendar year,
to not more than 45,000,000 square meter equivalents of
cotton or man-made fiber apparel, to not more than 1,500,000
square meter equivalents of wool apparel, and to not more
than 25,000,000 square meter equivalents of goods entered
under subheading 9802.00.80 of the HTS.
``(II) Except as provided in subclause (III), the amounts
set forth in subclause (I) shall be allocated among the 7
partnership countries with the largest volume of exports to
the United States of textile and apparel goods in calendar
year 1996, based upon a pro rata share of the volume of
textile and apparel goods of each of those 7 countries that
entered the United States under subheading 9802.00.80 of the
HTS during the first 12 months of the 14-month period ending
on the date of the enactment of the United States-Caribbean
Trade Partnership Act.
``(III) Five percent of the amounts set forth in subclause
(I) shall be allocated among the partnership countries, other
than those to which subclause (II) applies, based upon a pro
rata share of the exports to the United States of textile and
apparel goods of each of those countries during the first 12
months of the 14-month period ending on the date of the
enactment of the United States-Caribbean Trade Partnership
Act.
``(iii) Prior consultation.--The President may implement
the preferential tariff treatment described in clause (i)
only after consultation with representatives of the United
States textile and apparel industry and other interested
parties regarding--
``(I) the specific articles to which such treatment will be
extended,
``(II) the annual quantities of such articles that may be
imported at the preferential duty rates described in clause
(i), and
``(III) the allocation of such annual quantities among
beneficiary countries.
``(C) Handloomed, handmade, and folklore articles.--For
purposes of subparagraph (A), the Trade Representative shall
consult with representatives of the partnership country for
the purpose of identifying particular textile and apparel
goods that are mutually agreed upon as being handloomed,
handmade, or folklore goods of a kind described in section
2.3 (a), (b), or (c) or Appendix 3.1.B.11 of the Annex.
``(D) Bilateral emergency actions.--(i) The President may
take--
``(I) bilateral emergency tariff actions of a kind
described in section 4 of the Annex with respect to any
textile or apparel article imported from a partnership
country if the application of tariff treatment under
subparagraph (A) to such article results in conditions that
would be cause for the taking of such actions under such
section 4 with respect to an article described in the same 8-
digit subheading of the HTS that is imported from Mexico; or
``(II) bilateral emergency quantitative restriction actions
of a kind described in section 5 of the Annex with respect to
imports of any textile or apparel article described in
subparagraphs (B)(i) (I) and (II) if the importation of such
article into the United States results in conditions that
would be cause for the taking of such actions under such
section 5 with respect to a like article that is a product
of Mexico.
``(ii) The requirement in paragraph (5) of section 4 of the
Annex (relating to providing compensation) shall not be
deemed to apply to a bilateral emergency action taken under
this subparagraph.
``(iii) For purposes of applying bilateral emergency action
under this subparagraph--
``(I) the term `transition period' in sections 4 and 5 of
the Annex shall be deemed to be the period defined in
paragraph (5)(E); and
``(II) any requirements to consult specified in section 4
or 5 of the Annex are deemed to be satisfied if the President
requests consultations with the partnership country in
question and the country does not agree to consult within the
time period specified under such section 4 or 5, whichever is
applicable.
``(3) NAFTA transition period treatment of certain other
articles originating in beneficiary countries.--
``(A) Equivalent tariff treatment.--
``(i) In general.--Subject to clause (ii), the tariff
treatment accorded at any time during the transition period
to any article referred to in any of subparagraphs (B)
through (F) of paragraph (1) that originates in the territory
of a partnership country shall be identical to the tariff
treatment that is accorded at such time under Annex 302.2 of
the NAFTA to an article described in the same 8-digit
subheading of the HTS that is a good of Mexico and is
imported into the United States.
``(ii) Exception.--Clause (i) does not apply to any article
accorded duty-free treatment under U.S. Note 2(b) to
subchapter II of chapter 98 of the HTS.
``(B) Relationship to subsection (h) duty reductions.--If
at any time during the transition period the rate of duty
that would (but for action taken under subparagraph (A)(i) in
regard to such period) apply with respect to any article
under subsection (h) is a rate of duty that is lower than the
rate of duty resulting from such action, then such lower rate
of duty shall be applied for the purposes of implementing
such action.
``(4) Customs procedures.--
``(A) In general.--
``(i) Regulations.--Any importer that claims preferential
tariff treatment under paragraph (2) or (3) shall comply with
customs procedures similar in all material respects to the
requirements of Article 502(1) of the NAFTA as implemented
pursuant to United States law, in accordance with regulations
promulgated by the Secretary of the Treasury.
``(ii) Determination.--In order to qualify for such
preferential tariff treatment and for a Certificate of Origin
to be valid with respect to any article for which such
treatment is claimed, there shall be in effect a
determination by the President that--
``(I) the partnership country from which the article is
exported, and
``(II) each partnership country in which materials used in
the production of the article originate or undergo production
that contributes to a claim that the article qualifies for
such preferential tariff treatment,
has implemented and follows, or is making substantial
progress toward implementing
[[Page H9875]]
and following, procedures and requirements similar in all
material respects to the relevant procedures and requirements
under chapter 5 of the NAFTA.
``(B) Certificate of origin.--The Certificate of Origin
that otherwise would be required pursuant to the provisions
of subparagraph (A) shall not be required in the case of an
article imported under paragraph (2) or (3) if such
Certificate of Origin would not be required under Article 503
of the NAFTA (as implemented pursuant to United States law),
if the article were imported from Mexico.
``(C) Penalties for transshipments.--If the President
determines, based on sufficient evidence, that an exporter
has engaged in willful illegal transshipment or willful
customs fraud with respect to textile or apparel articles for
which preferential tariff treatment under subparagraph (A) or
(B) of paragraph (2) is claimed, then the President shall
deny all benefits under this title to such exporter, and any
successors of such exporter, for a period of 2 years.
``(D) Study by ustr on cooperation of other countries
concerning circumvention.--The United States Commissioner of
Customs shall conduct a study analyzing the extent to which
each partnership country--
``(i) has cooperated fully with the United States,
consistent with its domestic laws and procedures, in
instances of circumvention or alleged circumvention of
existing quotas on imports of textile and apparel goods, to
establish necessary relevant facts in the places of import,
export, and, where applicable, transshipment, including
investigation of circumvention practices, exchanges of
documents, correspondence, reports, and other relevant
information, to the extent such information is available;
``(ii) has taken appropriate measures, consistent with its
domestic laws and procedures, against exporters and importers
involved in instances of false declaration concerning fiber
content, quantities, description, classification, or origin
of textile and apparel goods; and
``(iii) has penalized the individuals and entities involved
in any such circumvention, consistent with its domestic laws
and procedures, and has worked closely to seek the
cooperation of any third country to prevent such
circumvention from taking place in that third country.
The Trade Representative shall submit to the Congress, not
later than October 1, 1998, a report on the study conducted
under this subparagraph.
``(5) Definitions.--For purposes of this subsection--
``(A) The term `the Annex' means Annex 300-B of the NAFTA.
``(B) The term `NAFTA' means the North American Free Trade
Agreement entered into between the United States, Mexico, and
Canada on December 17, 1992.
``(C) The term `partnership country' means a beneficiary
country.
``(D) The term `textile or apparel article' means any
article referred to in paragraph (1)(A) that is a good listed
in Appendix 1.1 of the Annex.
``(E) The term `transition period' means, with respect to a
partnership country, the period that begins on May 15, 1998,
and ends on the earlier of--
``(i) July 15, 1999; or
``(ii) the date on which--
``(I) the United States first applies the NAFTA to the
partnership country upon its accession to the NAFTA, or
``(II) there enters into force with respect to the United
States and the partnership country a free trade agreement
comparable to the NAFTA that makes substantial progress in
achieving the negotiating objectives set forth in section
108(b)(5) of the North American Free Trade Agreement
Implementation Act (19 U.S.C. 3317(b)(5)).
``(F) An article shall be deemed as originating in the
territory of a partnership country if the article meets the
rules of origin for a good set forth in chapter 4 of the
NAFTA, and, in the case of an article described in Appendix
6.A of the Annex, the requirements stated in such Appendix
6.A for such article to be treated as if it were an
originating good. In applying such chapter 4 or Appendix 6.A
with respect to a partnership country for purposes of this
subsection--
``(i) no countries other than the United States and
partnership countries may be treated as being Parties to the
NAFTA,
``(ii) references to trade between the United States and
Mexico shall be deemed to refer to trade between the United
States and partnership countries, and
``(iii) references to a Party shall be deemed to refer to
the United States or a partnership country, and references to
the Parties shall be deemed to refer to any combination of
partnership countries or the United States.''.
(b) Determination Regarding Retention of Designation.--
Section 212(e)(1) of the Caribbean Basin Economic Recovery
Act (19 U.S.C. 2702(e)) is amended--
(1) by inserting ``(A)'' after ``(1)'';
(2) by redesignating subparagraphs (A) and (B) as clauses
(i) and (ii), respectively;
(3) by adding at the end the following:
``(B)(i) Based on the President's review and analysis
described in subsection (f), the President may determine if
the preferential treatment under section 213(b) (2) and (3)
should be withdrawn, suspended, or limited with respect to
any article of a partnership country. Such determination
shall be included in the report required by subsection (f).
``(ii) Withdrawal, suspension, or limitation of the
preferential treatment under section 213(b) (2) and (3) with
respect to a partnership country shall be taken only after
the requirements of subsection (a)(2) and paragraph (2) of
this subsection have been met.''.
(c) Reporting Requirements.--Section 212(f) of the
Caribbean Basin Economic Recovery Act (19 U.S.C. 2702(f)) is
amended to read as follows:
``(f) Reporting Requirements.--Not later than 1 year after
the date of the enactment of the United States-Caribbean
Trade Partnership Act and at the close of each 3-year period
thereafter, the President shall submit to the Congress a
complete report regarding the operation of this title,
including--
``(1) with respect to subsections (b) and (c) of this
section, the results of a general review of beneficiary
countries based on the considerations described in such
subsections;
``(2) with respect to subsection (c)(4), the degree to
which a country follows accepted rules of international trade
provided for under the General Agreement on Tariffs and Trade
and the World Trade Organization;
``(3) with respect to subsection (c)(9), the extent to
which beneficiary countries are providing or taking steps to
provide protection of intellectual property rights comparable
to the protection provided to the United States in bilateral
intellectual property rights agreements;
``(4) with respect to subsection (b)(2) and subsection
(c)(5), the extent that beneficiary countries are providing
or taking steps to provide protection of investment and
investors comparable to the protection provided to the United
States in bilateral investment treaties;
``(5) with respect to subsection (c)(3), the extent that
beneficiary countries are providing the United States and
other WTO members (as such term is defined in section 2(10)
of the Uruguay Round Agreements Act (19 U.S.C. 3501(10)) with
equitable and reasonable market access in the product sectors
for which benefits are provided under this title;
``(6) with respect to subsection (c)(11), the extent that
beneficiary countries are cooperating with the United States
in administering the provisions of section 213(b); and
``(7) with respect to subsection (c)(8), the extent that
beneficiary countries are meeting the internationally
recognized worker rights criteria under such subsection.
In the first report under this subsection, the President
shall include a review of the implementation of section
213(b), and his analysis of whether the benefits under
paragraphs (2) and (3) of such section further the objectives
of this title and whether such benefits should be
continued.''.
(d) Conforming Amendment.--Section 213(a)(1) of the
Caribbean Basin Economic Recovery Act is amended by inserting
``and except as provided in section 213(b) (2) and (3),''
after ``Tax Reform Act of 1986,''.
SEC. 5. EFFECT OF NAFTA ON SUGAR IMPORTS FROM BENEFICIARY
COUNTRIES.
The President shall monitor the effects, if any, that the
implementation of the NAFTA has on the access of beneficiary
countries under the Caribbean Basin Economic Recovery Act to
the United States market for sugars, syrups, and molasses. If
the President considers that the implementation of the NAFTA
is affecting, or will likely affect, in an adverse manner the
access of such countries to the United States market, the
President shall promptly--
(1) take such actions, after consulting with interested
parties and with the appropriate committees of the House of
Representatives and the Senate, or
(2) propose to the Congress such legislative actions,
as may be necessary or appropriate to ameliorate such adverse
effect.
SEC. 6. DUTY-FREE TREATMENT FOR CERTAIN BEVERAGES MADE WITH
CARIBBEAN RUM.
Section 213(a) of the Caribbean Basin Economic Recovery Act
(19 U.S.C. 2703(a)) is amended--
(1) in paragraph (5), by striking ``chapter'' and inserting
``title''; and
(2) by adding at the end the following new paragraph:
``(6) Notwithstanding paragraph (1), the duty-free
treatment provided under this title shall apply to liqueurs
and spirituous beverages produced in the territory of Canada
from rum if--
``(A) such rum is the growth, product, or manufacture of a
beneficiary country or of the Virgin Islands of the United
States;
``(B) such rum is imported directly from a beneficiary
country or the Virgin Islands of the United States into the
territory of Canada, and such liqueurs and spirituous
beverages are imported directly from the territory of Canada
into the customs territory of the United States;
``(C) when imported into the customs territory of the
United States, such liqueurs and spirituous beverages are
classified in subheading 2208.90 or 2208.40 of the HTS; and
``(D) such rum accounts for at least 90 percent by volume
of the alcoholic content of such liqueurs and spiritous
beverages.''.
SEC. 7. MEETINGS OF TRADE MINISTERS AND USTR.
(a) Schedule of Meetings.--The President shall take the
necessary steps to convene a meeting with the trade ministers
of the partnership countries in order to establish a schedule
of regular meetings, to commence as soon as is practicable,
of the trade ministers and the Trade Representative, for the
purpose set forth in subsection (b).
(b) Purpose.--The purpose of the meetings scheduled under
subsection (a) is to reach
[[Page H9876]]
agreement between the United States and partnership countries
on the likely timing and procedures for initiating
negotiations for partnership to accede to the NAFTA, or to
enter into mutually advantageous free trade agreements with
the United States that contain provisions comparable to those
in the NAFTA and would make substantial progress in achieving
the negotiating objectives set forth in section 108(b)(5) of
the North American Free Trade Agreement Implementation Act
(19 U.S.C. 3317(b)(5)).
SEC. 8. REPORT ON ECONOMIC DEVELOPMENT AND MARKET ORIENTED
REFORMS IN THE CARIBBEAN.
(a) In General.--The Trade Representative shall make an
assessment of the economic development efforts and market
oriented reforms in each partnership country and the ability
of each such country, on the basis of such efforts and
reforms, to undertake the obligations of the NAFTA. The Trade
Representative shall, not later than July 1, 1998, submit to
the President and to the Committee on Finance of the Senate
and the Committee on Ways and Means of the House of
Representatives a report on that assessment.
(b) Accession to NAFTA.--
(1) Ability of countries to implement nafta.--The Trade
Representative shall include in the report under subsection
(a) a discussion of possible timetables and procedures
pursuant to which partnership countries can complete the
economic reforms necessary to enable them to negotiate
accession to the NAFTA. The Trade Representative shall also
include an assessment of the potential phase-in periods that
may be necessary for those partnership countries with less
developed economies to implement the obligations of the
NAFTA.
(2) Factors in assessing ability to implement nafta.--In
assessing the ability of each partnership country to
undertake the obligations of the NAFTA, the Trade
Representative should consider, among other factors--
(A) whether the country has joined the WTO;
(B) the extent to which the country provides equitable
access to the markets of that country;
(C) the degree to which the country uses export subsidies
or imposes export performance requirements or local content
requirements;
(D) macroeconomic reforms in the country such as the
abolition of price controls on traded goods and fiscal
discipline;
(E) progress the country has made in the protection of
intellectual property rights;
(F) progress the country has made in the elimination of
barriers to trade in services;
(G) whether the country provides national treatment to
foreign direct investment;
(H) the level of tariffs bound by the country under the WTO
(if the country is a WTO member);
(I) the extent to which the country has taken other trade
liberalization measures; and
(J) the extent which the country works to accommodate
market access objectives of the United States.
(c) Parity Review in the Event a New Country Accedes to
NAFTA.--If--
(1) a country or group of countries accedes to the NAFTA,
or
(2) the United States negotiates a comparable free trade
agreement with another country or group of countries,
the Trade Representative shall provide to the committees
referred to in subsection (a) a separate report on the
economic impact of the new trade relationship on partnership
countries. The report shall include any measures the Trade
Representative proposes to minimize the potential for the
diversion of investment from partnership countries to the new
NAFTA member or free trade agreement partner.
SEC. 9. OVERRULING OF SCHMIDT BAKING COMPANY CASE WITH
RESPECT TO SEVERANCE PAY.
(a) In General.--The Internal Revenue Code of 1986 shall be
applied with respect to severance pay without regard to the
result reached in the case of Schmidt Baking Company, Inc. v.
Commissioner of Internal Revenue, 107 T.C. 271 (1996).
(b) Regulations.--The Secretary of the Treasury or the
Secretary's delegate shall prescribe regulations to reflect
subsection (a).
(c) Effective Date.--
(1) In general.--Subsections (a) and (b) shall apply to
taxable years ending after October 8, 1997.
(2) Change in method of accounting.--In the case of any
taxpayer required by this section to change its method of
accounting for its first taxable year ending after October 8,
1997--
(A) such change shall be treated as initiated by the
taxpayer,
(B) such change shall be treated as made with the consent
of the Secretary of the Treasury, and
(C) the net amount of the adjustments required to be taken
into account by the taxpayer under section 481 of the
Internal Revenue Code of 1986 shall be taken into account in
such first taxable year.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Illinois [Mr. Crane] and the gentleman from New York [Mr. Rangel] each
will control 20 minutes.
Mr. CARDIN. Mr. Speaker, may I inquire whether the gentleman from New
York [Mr. Rangel] is opposed to the bill?
Mr. RANGEL. No, Mr. Speaker, I am not.
The SPEAKER pro tempore. Is the gentleman from Maryland opposed to
the bill?
Mr. CARDIN. Yes; and I would ask to claim the time in opposition, Mr.
Speaker.
The SPEAKER pro tempore. The gentleman from Maryland [Mr. Cardin]
will be recognized for 20 minutes.
The Chair recognizes the gentleman from Illinois [Mr. Crane].
Mr. CRANE. Mr. Speaker, I yield 10 minutes to the gentleman from New
York [Mr. Rangel], and I ask unanimous consent that he be permitted to
yield further blocks of time in support of the bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Illinois?
There was no objection.
Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise today in strong support of H.R. 2644, the United
States-Caribbean Basin Trade Partnership Act. This bill would allow the
people of the Caribbean region to compete on a level playing field with
their counterparts in the rest of North America.
I firmly believe fostering self-sufficiency through trade, not
foreign aid, is the best way to assist our 30 million neighbors living
in the Caribbean Basin countries, especially given the relative lack of
development in that region.
The bill accomplishes this by granting to the Caribbean Basin
partnership countries tariff treatments similar to that accorded to
Canada and Mexico for a temporary period of 14 months. I believe that
expanding the benefits of the Caribbean Basin initiative on a temporary
basis will encourage partnership countries to complete the economic
reforms that will be necessary for them to qualify for similar trade
benefits on a permanent basis in the future.
For my colleagues who are new to this body, the original Caribbean
Basin initiative, or CBI, was passed in 1983 under the leadership of
President Reagan and Mr. Sam Gibbons. The program is based on the
understanding that it is in the national security interests of the
United States to encourage the development of strong democratic
governments and healthy economies in neighboring countries of the
Caribbean and Central America through the expansion of trade.
Likewise, it is fundamentally in the economic interests of the United
States to encourage coproduction arrangements with the region in order
to sustain textile and apparel manufacturing operations in the United
States under changing competitive conditions.
Since the CBI became law, U.S. trade policy has focused on other
geographic areas. The bill before us today assures that our commitment
to the Caribbean Basin countries fostered by Ronald Reagan nearly 15
years ago is not eroded over time.
{time} 1230
Furthermore, I believe it is important that the United States develop
a coherent trade policy that recognizes the economic development needs
of Caribbean Basin countries and which does not prejudice their
participation in future trade arrangements.
My purpose in pursuing this bill is to foster a policy where CBI
countries receive guidance and the necessary incentives to adopt the
market opening reforms that will prepare them for further trade
liberalization.
I want to emphasize here today that expanding trade with the
Caribbean through existing CBI provisions has already been a huge
success for U.S. business and workers. During the life of the program,
U.S. exports to the region have grown from $5.8 billion in 1983 to over
$15.4 billion in 1996. Last year, U.S. exports to the Caribbean Basin
grew by 14.5 percent, a rate more than twice as great as the rate of
growth in U.S. exports to the rest of the world.
Prior to the original CBI legislation, the United States ran a
substantial trade deficit with the region. The United States now has
almost a $1 billion annual trade surplus with this group of countries.
Moreover, many of the countries in the region regularly import the vast
majority of the foreign products they purchase each year from the
United States.
[[Page H9877]]
As CBI countries expand their success, it translates directly into
U.S. economic growth and job creation. Presently, the U.S.-Caribbean
commercial relationship supports more than 300,000 jobs in the United
States. Virtually every State in the Union has benefited from this
relationship. I know my own State of Illinois sold $319 million of
exports to the region last year.
Finally, I would remind my colleagues that the provisions of this
bill were already approved by the House last summer as part of the
balanced budget reconciliation bill. They were dropped in conference at
the insistence of the Senate which had not yet considered the measure.
However, the Senate Committee on Finance recently reported similar
legislation. So consideration of the bill separately today is highly
appropriate, now that the other body is beginning to appreciate the
importance of expanding trade with the CBI region.
Mr. Speaker, H.R. 2644 was reported from the Committee on Ways and
Means by voice vote twice this year and has strong bipartisan support.
Let us build on past success and expand the U.S. partnership with our
neighbors in the Caribbean Basin. I urge approval of H.R. 2644.
Mr. Speaker, I reserve the balance of my time.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
(Mr. RANGEL asked and was given permission to revise and extend his
remarks.)
Mr. RANGEL. Mr. Speaker, I rise in strong support of H.R. 2644.
As the gentleman from Illinois [Mr. Crane] pointed out, in 1983 we
saw fit to go into a trade agreement with the small island countries.
It was really an emotional experience, as the Committee on Ways and
Means visited island after island, to see the love and affection that
the people of these countries had. Even though some of them had just
first started enjoying democracy, most all of them, then as now, are
living through very fragile economies.
There were a lot of Members who thought that we would be big losers
in this trade, but as it turned out, and the gentleman from Illinois
[Mr. Crane] has pointed out, we have had a tremendous increase in
exports to these countries, over 150 percent over the last 12 years.
But the most exciting thing to see when you do visit these countries
is, every place you go it says, ``Made in the U.S.A.'' It is ``Made in
the U.S.A.'' because we have been more than just trading partners, we
have really been friends, and this friendship is now being tested as we
see the devastating effects that the North American Free Trade
Agreement has had on these small countries.
I know that NAFTA had been controversial when it was first passed. I
know it is controversial today. I know some Members, when they see
NAFTA, they want to vote against anything that looks like an extension
of it. But if they would just pause and see that what has happened is
that the passage of NAFTA has caused the advantages, or the parity,
that we had hoped to give to the people on these islands to put them at
a definite disadvantage as we find that trade that normally we would be
doing with these Caribbean countries is now going on in Mexico.
So it means that friends of the Caribbean and the United States that
have promised that we were going to give them a level playing field are
now coming today saying, ``I do not like NAFTA.'' It seems to me that
we should not hold these small countries hostage because of a
disadvantage that they are now suffering because of legislation or
trade agreements that some Members may have.
Please remember that we are not talking about North Vietnam. We are
not talking about North Korea. We are not talking about Communist
China. We are talking about traditional friends that are going through
some very hard economic times, that we have never had to beg for their
friendship, we have never had to pay for their friendship. When the
whole world seemed like they were going against us, including Europe,
we always had our friends in the Caribbean. So I hope that the United
States domestic politics does not override the fact that we should be
doing the right thing.
Please remember, we are not talking about giving them any advantages.
We are talking about keeping our promise that we made to these very
small island countries when we entered into the 1983 agreement. It is
good for the people in the Caribbean; it is good for the United States.
It is good for the free world to see a leader like we are take care of
our friends who may not be as big and may not be as powerful but, to
me, and I hope to my colleagues, they are just as important.
Mr. Speaker, I reserve the balance of my time.
Mr. CARDIN. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would urge my colleagues to vote against this
suspension of the rules. I would like to follow up on some of the
comments that the gentleman from New York [Mr. Rangel] made.
H.R. 2644, the U.S.-Caribbean Trade Act, is meant to provide parity
with the nations in the Caribbean with Mexico as it relates to NAFTA.
First, it is important to point out that the nations that we are
talking about, they are not just the small island nations but we are
talking about many of the countries of Central America.
What is the reason for this bill? Why is there the need for parity?
What has NAFTA caused harm in the Caribbean nations? If you look at the
major industry that was created by the Caribbean Basin Initiative, it
has been the selling of garments that has been one of the principal
objectives of the CBI initiative.
Since the passage of NAFTA, the export share from the Caribbean and
Central American nations in the CBI has increased from 18 percent to 23
percent their share of U.S. market. They have not been hurt by NAFTA.
It appears like they have been helped. If you look at the percentage
increase from the 26 CBI nations to the United States, between 1993 and
1996, in apparel, it has increased by 63 percent.
So we have seen a significant increase in exports from these nations
since the passage of NAFTA. We are not talking about small industries.
The textile and apparel imports from the CBI nations, namely, from
Central America, totaled $6.1 billion last year. By contrast, imports
from Mexico were $3.6 billion. We have more imports from Central
America and the Caribbean than we do from Mexico.
But unlike NAFTA, and this is called the NAFTA Parity Act, I think it
is a misnomer because, unlike NAFTA, there are no obligations on the
Caribbean nations that are part of the CBI for getting these additional
benefits. There are no requirements for sanctions against sweatshops or
child labor, for requirements for cooperation on drug interdiction,
money laundering or illegal immigration, no requirements to remove
trade barriers from U.S. exporters.
This bill has been scored at $243 million for its 14 months. The
taxpayers of this country should not be subsidizing more loss of jobs
here in the United States. If we use our 5-year rules, as we should be
using, this bill costs over $1 billion. At the very least, the Members
of this body should have the opportunity to offer amendments to this
legislation.
The chairman of the subcommittee mentioned that our friends in the
other body have moved similar legislation. It is quite different in
that it does provide certain protection to U.S. manufacturers and
producers. The legislation considered in the other body requires that
the textiles be made from U.S. fabric. That is not the bill that we
have before us. Some of us would like to be able to offer that as an
amendment, but under suspension of rules, we cannot; it is not the
right process.
The Members of this House should have the opportunity to fully debate
this issue and offer amendments. It is a very important bill. I would
urge my colleagues to resist the suspension of rules. Let it go through
normal order.
Mr. Speaker, I reserve the balance my time.
Mr. CRANE. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from
North Carolina [Mr. Ballenger].
Mr. BALLENGER. Mr. Speaker, I rise in support of the U.S. Caribbean
Trade Partnership Act.
This bill, introduced by the gentleman from Texas [Mr. Archer] and
the gentleman from Illinois [Mr. Crane], extends duty-free access for
14
[[Page H9878]]
months to certain products such as apparel, handbags, and so forth. As
a member of the Committee on International Relations, I have always
supported trade with our neighbors in this hemisphere. We have
consistently worked to reduce tariffs and to ease trade barriers
between our country and Latin America.
The United States Caribbean Trade Partnership Act will restore trade
benefits to our Caribbean neighbors which were lost as a result of
NAFTA. Ultimately, increased trade will create jobs here and help
countries like Nicaragua, El Salvador, Guatemala become more stable.
After years of war and removing dictators, these countries are now
fragile democracies and need our help.
However, I do have some reservations about the rule-of-origin
requirements of this bill. However, my belief is that with this
guarantee, this bill will create more domestic jobs and opportunities
for Americans. Reducing tariffs will result in lower consumer prices
for imported products which benefit all consumers. Americans will
benefit from these changes, and they will go to purchase clothes and
other items. Join me in supporting the United States Caribbean Trade
Partnership Act.
Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from
Kentucky [Mr. Bunning].
Mr. BUNNING. Mr. Speaker, 4 years ago almost to the day, I spoke
against and voted against the North American Free Trade Agreement.
Unfortunately, time has proven that NAFTA was wrong for America, and by
attempting to expand it today, we are only compounding that mistake.
How many more jobs do we have to lose until we wake up and smell the
Caribbean coffee?
If you voted against the NAFTA or you are not happy with the effects
that NAFTA has had on America, then do not vote today to expand it and
for the CBI countries. Before you vote on this issue, ask yourself
three simple questions: Are there any benefits to the American worker
in extending NAFTA to the CBI countries? The answer is ``no''. Will
extending the NAFTA to Caribbean countries increase American jobs? The
answer is no. Will it cost U.S. jobs? The answer is ``yes''.
Extending the NAFTA to Central American countries will only cost more
hard-working Americans good-paying jobs. In fact, just last month a
major textile manufacturer in my State announced that they were cutting
800 jobs from their Campbellsville and Jamestown, KY plants and moving
them south of the border. However, instead of saying adios to these
jobs, we should be doing all that we can to protect them and keep them
in places like Campbellsville and Jamestown, KY.
NAFTA was a mistake, the wrong treaty at the wrong time. It is too
late to stop NAFTA, but it is not too late to limit the damage. Join me
in denying the extension of NAFTA trade benefits to the Caribbean and
Central American countries. Vote ``no'' on CBI parity.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Pennsylvania [Mr. Fattah].
Mr. FATTAH. Mr. Speaker, let me thank the gentleman from New York
[Mr. Rangel], ranking member of the Committee on Ways and Means, and
also the gentleman from New York [Mr. Gilman] and the gentleman from
Illinois [Mr. Crane]. This is a very, very important piece of
legislation because it speaks to who we are as a country, what the
nature of the contribution is that we are prepared to make to help
build in this hemisphere the relationship that will be necessary.
There has been a lot said here today. I wanted to rise in support of
this bill. It is critically important that our neighbors in the
Caribbean see that we are willing to work with their very fragile
democratic circumstances, help to continue to build their economies.
They are in a whole host of bilateral and hemispheric agreements with
us relative to crime and safety, drug trafficking, money laundering
that has been mentioned earlier. We have to make sure that these
economies can lawfully participate in what has now been created as
almost a market between Canada and Mexico and ourselves. We see the
European Union being formed. We see our neighbors in the Pacific rim
getting their act together.
{time} 1245
We do not want these small island nations just to fall by the
wayside. I want to thank the gentleman from New York [Mr. Rangel] for
his leadership on this and would hope that all of us would find it
within ourselves to be supportive of this.
The gentleman from Maryland [Mr. Cardin] said there would be some
cost. He is correct. There will be some cost. There will be costs
either way that we proceed. I think that what the gentleman from New
York [Mr. Rangel] offers for us is an opportunity for us to do what is
right. And, in the end, not only will there be some costs, but there
will be some rewards for our Nation for standing by our friends who
have been our traditional allies.
Mr. CARDIN. Mr. Speaker, I yield 3 minutes to my friend, the
gentleman from Georgia [Mr. Lewis], a member of the Committee on Ways
and Means.
Mr. LEWIS of Georgia. Mr. Speaker, I want to thank my friend and
colleague the gentleman from Maryland [Mr. Cardin] for yielding me the
time.
Mr. Speaker, this bill does not make sense to me. It is bad news for
American workers and bad policy. Supporters of this bill argue that it
is designed to help Caribbean nations that have suffered as a result of
NAFTA. They said that these countries have lost business to Mexico as a
result of NAFTA.
Well, Mr. Speaker, another group of people have suffered as a result
of NAFTA, and they will suffer as a result of this bill, the American
workers. Since NAFTA, exports from Mexico are up. Since NAFTA, exports
from the CBI countries are up. Since NAFTA, our trade surplus with
Mexico has changed to a trade deficit.
NAFTA has helped Mexican exports. During the same time, the CBI
countries have increased the apparel export to the United States.
However, during that same time, one group has lost, American workers.
More than 250,000 American apparel workers have lost their jobs to
Mexico and the CBI nations. So this bill does not make sense. It does
not make any sense to me.
Many of the workers who lost their jobs are minorities and women.
Many of them live and work in areas where there are few other jobs.
These jobs are good jobs. The workers do not get rich in these jobs,
but they make a living wage. And this bill will speed up the loss of
these jobs.
It is not necessary for the CBI nations. They are doing pretty well.
Their exports to the United States have increased since NAFTA. I
support trade with other nations. I support workers in Mexico and the
CBI countries. But we need to be on the floor today considering a bill
that helps American workers, a bill that helps keep jobs here at home,
here in this country, a bill that promotes American products and helps
American workers. We need a bill that promotes free and fair and open
trade. We need trade with other countries. But it cannot, it must not,
be trade at the expense of our working men and women.
I urge all of my colleagues to oppose this bill.
Mr. CRANE. Mr. Speaker, I yield myself such time as I may consume.
I remind my colleague, the gentleman from Georgia [Mr. Lewis], that
we have been at full employment for two straight years.
Mr. Speaker, I yield 3 minutes to our distinguished colleague, the
gentleman from New York [Mr. Gilman].
(Mr. GILMAN asked and was given permission to revise and extend his
remarks.)
Mr. GILMAN. Mr. Speaker, I thank the gentleman from Illinois [Mr.
Crane] for yielding me the time.
Mr. Speaker, I am pleased to rise in support of the Caribbean Basin
Trade Partnership Act. I want to commend the gentleman from Illinois
[Mr. Crane], our distinguished chairman of the Subcommittee on Trade,
the gentleman from Texas [Mr. Archer], the distinguished chairman of
the Committee on Ways and Means, and the gentleman from New York [Mr.
Rangel], ranking minority member, for bringing this matter to the floor
at this time.
In 1983, President Reagan launched the Caribbean Basin Initiative to
extend America's hand to our neighbors in the Caribbean. At that time,
the threat was subversion sponsored by the Soviet Union and Cuba.
Today, the threat of narcotics trafficking in the region is as grave
and more insidious than ever.
[[Page H9879]]
By fostering trade and legitimate investment, this bill will
strengthen our friends and neighbors in this strategic region to resist
the utterly corrosive temptation to turn to transshipping drugs onto
our streets as a way of earning their livelihood.
Helping our friends and neighbors in the Caribbean has benefited our
Nation. Taken as a whole, the Caribbean Basin is our Nation's tenth
largest export market, surpassing countries such as France. The
Caribbean Basin is one of the few regions in the world where U.S.
exporters have maintained a trade surplus each and every year for the
past 11 years; 70 cents of each dollar spent in the Caribbean is sent
right back here to our Nation on U.S. goods and services.
In the garment industry, for example, Caribbean firms rely heavily
upon U.S. produced textiles. This bill provides a more level playing
field for American and Caribbean manufacturers to deepen their mutually
beneficial partnerships.
I would like to take this opportunity, Mr. Speaker, to call on the
administration to translate this bill into renewed attention to
restarting the assembly firms in Haiti, which, along with businesses
here in our Nation and in my own congressional district were devastated
by the recent economic embargo.
New York is the 7th largest supplier to that region. This bill will
enhance New York's position in the Caribbean Basin. The Caribbean Basin
Economic Recovery Act, unlike NAFTA, provides several important
safeguards to participate in the program. Caribbean countries will have
to satisfy conditions under existing CBI legislation. CBI countries
will have to satisfy additional criteria relating to market access for
U.S. products, investment guarantees, adherence to internationally
accepted rules of international trade, observance of internationally
recognized workers rights, and promotion of intellectual property
rights.
The President will be authorized to revoke a country's eligibility if
that country fails to satisfy existing CBI criteria or meet any of the
new criteria established under this law. Accordingly, passage of this
bill will move it to conference where additional concerns may be
addressed.
I urge my colleagues to join in supporting the legislation.
Mr. CARDIN. Mr. Speaker, I yield 2 minutes to my friend, the
gentleman from North Carolina [Mr. Watt].
Mr. WATT of North Carolina. Mr. Speaker, I rise in reluctant
opposition to this bill. I say ``reluctant'' because it is always
difficult to be on the opposite side of an issue from my friend, the
gentleman from New York [Mr. Rangel], and also because, as a general
proposition, I am a supporter of CBI parity.
Unfortunately, this bill does not get us where we need to be, and it
comes on the suspension calendar, where nobody can make any amendments
or offer any amendments to improve the bill and address some of the
issues which need to be addressed. Second, it has a particularly
adverse effect on the workers in my State of North Carolina.
The gentleman from Illinois [Mr. Crane] indicated that we have been
at full employment for some time now. Tell that to the workers in North
Carolina. H.R. 2644 will reduce or eliminate tariffs and quotas on
watches, food ware, tuna, and apparel. These industries enjoy some
modest tariff and quota protection because they are vulnerable to cheap
imports.
Supporters of this bill imply that giving away the jobs in these
industries, especially in the garment industry, is an acceptable
sacrifice. But let me tell my colleagues a little about these people
who work in this industry in North Carolina. These workers in these
factories are hard-working people. They are considered unskilled
workers, but only because their highly developed sewing skills do not
have much application outside the garment industry. They have spent
years perfecting their craft.
This bill will pull the rug from under them. My colleagues will hear
that garment jobs are low-paying jobs and we should sacrifice them, but
an experienced seamstress in North Carolina makes about $10 an hour.
Those are jobs that, if they cannot do these jobs, they are going
somewhere else offshore and these people will be forced onto welfare.
We should not have to make that sacrifice. We should defeat this bill.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Nebraska [Mr. Bereuter].
(Mr. BEREUTER asked and was given permission to revise and extend his
remarks.)
Mr. BEREUTER. Mr. Speaker, I thank the distinguished gentleman from
New York [Mr. Rangel] for yielding me the time.
Since the Caribbean Basin Initiative in 1983, that legislation has
created about 18,000 new American export-oriented jobs each year. What
was once a trade deficit has grown into a very major trade surplus for
us. And those CBI countries today purchase as much as 75 percent of
their imports from the United States. A good portion of that gain has
been in the textile and apparel industries.
To maintain a globally competitive product and to offset the
advantages of low wages from our Asian competitors, many United States
firms have formed strategic alliances with garment firms throughout the
Caribbean Basin region. I saw, with the distinguished gentleman from
New York [Mr. Rangel] in a CODEL led by the gentleman from Nevada [Mr.
Gibbons], our former chairman of the Subcommittee on Trade, that kind
of a relationship ongoing in Jamaica, and that has been very beneficial
for American firms.
By using the combination of United States and Caribbean skills and
materials, American and CBI firms have developed a joint production
process that guarantees the viability of our domestic industry while
ensuring the production of quality cost competitive garments. That is
just one example.
CBI has been conceived as a way to help the United States and
Caribbean and Central American countries navigate the threats of the
Cold War. That is over. But it is time to update this program to help
the United States and its neighbors in the Caribbean and Central
America face the challenges of the next century.
I strongly urge passage of H.R. 2644. It will strengthen the U.S.-
Caribbean Basin trade partnership, while at the same time embracing the
competitiveness of U.S. firms and workers.
Mr. CARDIN. Mr. Speaker, I yield 3 minutes to the gentleman from Ohio
[Mr. Traficant].
Mr. TRAFICANT. Mr. Speaker, I thank the gentleman from Maryland [Mr.
Cardin], my pit colleague, and as an old pit quarterback, today's
debate is not about friendship. Today's debate is about business.
I oppose this bill. I keep score. America is losing. Our trade
deficit with Japan is at record levels; trade deficit with China will
exceed $50 billion; trade deficit with Canada, $22 billion. And Mexico
started out as a $2 billion surplus. It is now a $20 billion deficit.
So let's forget about the $1 billion Caribbean surplus.
Let's tell it like it is. For some reason, Congress and the White
House keeps going forward on trade like a group of misdirected
masochists, so help me God. It reminds me of a smoker dying of lung
cancer who continues to chain smoke. Let's talk business today.
If you manufacture a product in Youngstown, OH, IRS, Social Security,
Workmen's Comp, Unemployment Comp, OHSA, EPA, bank regulations,
security regulations, pension law, health inspectors, minimum wage, and
$20 an hour average manufacturing costs. You move to Mexico or the
Caribbean, like you want, no OHSA, no EPA, no regs, no minimum wage, no
labor law, no labor unions, pensions, health insurance. What are you
talking about? That is foreign language. Let me tell my colleagues
something else. They hire people at 17 cents an hour.
Beam me up here. So help me God, the Constitution says, ``Congress
shall regulate commerce with foreign nations.'' Now evidently someone
interpreted it to mean that Congress shall donate commerce to foreign
nations. We are misdirected. We are wrong.
Japan and China, for years every President has threatened Japan to
open their markets, from Nixon up to Clinton. Evidently, Japan never
opened their markets. We need reciprocal trade. Let me tell my
colleagues something, this is a welfare program for Caribbean workers.
I am opposed to it. We are putting American workers in
[[Page H9880]]
welfare lines and extending sophisticated commercial trade concepts to
create welfare for foreign workers.
I disagree with this policy. And the greatest respect in the world
for the chairman, the gentleman from New York [Mr. Rangel], greatest
respect in the world. I am proud to see the gentleman from Maryland
[Mr. Cardin] step forward. I am glad to see it is a pitman.
My colleagues, I keep score. America is losing. We are elected to
look after the interests of the United States of America. We do not
have to hurt the Caribbean nations. But we sure as hell do not have to
give away the farm. I recommend my colleagues vote no on this.
Let me say one last thing about NAFTA expansion. There is no
amendment that can cure cancer. When we have cancer, we cut it out.
Let's start taking care of number one. We do not have to hurt anybody
else.
{time} 1300
Mr. CARDIN. Mr. Speaker, I yield 2 minutes to the gentleman from
California [Mr. Becerra], my colleague on the Committee on Ways and
Means.
(Mr. BECERRA asked and was given permission to revise and extend his
remarks.)
Mr. BECERRA. Mr. Speaker, I thank the gentleman for yielding me this
time. I come here with one particular concern. I believe it could have
been addressed adequately in committee and was not. On top of some of
the other things that have been said by some of my colleagues with
respect to concerns with regard to expanding NAFTA to the Caribbean
Basin, I do support and I did support NAFTA and I would support trying
to extend to the degree possible the free trade zone into the Caribbean
Basin. But let me focus my attention on one particular aspect which to
me personally rubs very deeply within me. In committee, I asked that we
try to extend trade adjustment assistance in this CBI proposal as we
had in NAFTA. Trade adjustment assistance goes to workers who are
dislocated as a result of companies moving from this country into the
new area of the free trade zone. There is $6 million available in this
legislation to pay for that type of adjustment assistance. We were told
we had no CBO comparison to tell us exactly how much it would cost. We
thought it would cost about the $6 million that was available. We find
out now that it is only $2 million that it would cost to provide the
protections to workers who may face dislocation as a result of this
legislation. Yet we have been unable to get any commitment on the part
of the Republican leadership to include the $2 million it would cost to
protect American workers who may face dislocation as a result of this.
What a small price to pay, especially when we have the money there. It
rubs me the wrong way to have to stand here to say that $2 million
stands in the way of being able to protect American workers. Why we
would not do that, I do not understand, and I am somewhat speechless,
because we have the money. We have $6 million available, $2 million to
protect American workers, to give them things like unemployment
benefits similar to unemployment benefits, to allow them to get
training, to allow them to have some assistance to make sure that their
families do not go without while they are unemployed. Yet we are not
going to do it. It does not make any sense, it is shameless, and for
that reason I had to take to the floor today.
Mr. CRANE. Mr. Speaker, I yield the balance of my time to the
distinguished gentleman from Illinois [Mr. Weller].
The SPEAKER pro tempore [Mr. Packard]. The gentleman from Illinois
[Mr. Weller] is recognized for 1 minute.
Mr. WELLER. Mr. Speaker, I want to thank the gentleman from Illinois
[Mr. Crane] for yielding me this time and also commend him for his
leadership as well as the gentlemen from New York and for Maryland for
their leadership, even though they disagree today.
Mr. Speaker, I plan to vote for this legislation, H.R. 2644 today,
because I believe that we do need to move forward in providing greater
trade opportunities, trade opportunities that do move towards free
trade. But I also stand as one of those who believes that as we work
for free trade, it should also be fair. I believe it is important to
expand our trade opportunities, particularly when they benefit States
such as Illinois, particularly Illinois middle-class working families.
Mr. Speaker, I will be voting for this legislation because I want it to
move forward, but what I ask as this legislation passes the House and
goes into conference is that we take a very careful look at some of the
ideas that are incorporated into the Senate version of this
legislation, ideas that I believe will help Illinois as well. I support
moving this legislation forward because I believe that we should always
work to expand trade opportunities. It is important for jobs back home
in Illinois.
Mr. CARDIN. Mr. Speaker, I yield the balance of my time to the
gentleman from South Carolina [Mr. Spratt] who has been one of the real
fighters for U.S. textiles.
The SPEAKER pro tempore. The gentleman from South Carolina [Mr.
Spratt] is recognized for 4 minutes.
(Mr. SPRATT asked and was given permission to revise and extend his
remarks.)
Mr. SPRATT. Mr. Speaker, I thank the gentleman for yielding me this
time. In just a short time I think we have shown that there are lots of
objections to the bill before us. First of all, at a time when our
trade deficit is reaching record highs, this bill, H.R. 2644, is
totally one-sided. It lowers tariffs, it lifts quotas on apparel and
six or seven different kinds of imports from 26 countries in the
Caribbean and Central America, and it does so unilaterally. These
countries are not required to make in return any trade concessions
whatsoever to the United States.
Second, this is a blanket grant of trade benefit to these CBI
countries without any sanctions, without even any questions being asked
about sweatshops or child labor or whether or not the country in
question cooperates with the United States when it comes to
interdicting drugs, money laundering and dealing with corrupt practices
and corrupt customs, and those problems are endemic in some of these
countries.
Why do we do this? Why do we make these unilateral concessions? All
in the name of fixing a nonexistent problem. Before NAFTA, the CBI
countries exported, this is volume, 1.39 billion square meter
equivalents of clothing to the United States. Since NAFTA, 1996, the
CBI countries increased their exports to 2.26 billion SMEs, square
meter equivalents. Before NAFTA, CBI imports accounted for 18.4 percent
of all apparel imports into the United States. Since NAFTA, CBI imports
have increased to 23.4 percent of all the apparel imports coming into
the United States. They have got a huge share of our market. These
countries are not suffering from NAFTA, far from it. They are shipping
us more clothing, more apparel than ever.
Mr. ABERCROMBIE. Mr. Speaker, will the gentleman yield?
Mr. SPRATT. I yield to the gentleman from Hawaii to comment on the
lack of sanctions and labor provisions.
Mr. ABERCROMBIE. Would the gentleman agree that the result of this,
then, is that the domestic industry is shrinking by thousands of jobs?
As a matter of fact, I believe that the domestic industry shrank by
56,000 jobs in 1996 alone and 52,000 more jobs through September of
this year.
Just today we had the announcement from the Levi Company that one-
third of all its employees in North America are going to be released.
The union representing these workers is forced to negotiate their
release. This clothing import situation under this bill will only get
worse, and that means the loss of American jobs by the thousands.
Mr. SPRATT. That is indeed the consequence of this and other
legislation, no question about it. Slipping this bill through under
suspension makes it appear to be uncontroversial or inconsequential.
The point I am trying to make is that H.R. 2644 will have a greater
impact on the U.S. apparel industry and U.S. apparel workers than NAFTA
ever had.
Because of rules, long-standing rules known as item 807 and item
807(a), cloth that is cut and made in the United States can be sewn and
assembled under clothing in a CBI country. Then when the clothing is
reexported to the United States, the duties imposed when it comes back
into our country are only imposed on the value added in the CBI
country.
[[Page H9881]]
Because of this concession, which has existed for a long time, the
CBI countries now export to the United States more than twice as much
apparel as Mexico, whether we measure it by volume in SMEs or by value.
In 1996, the CBI countries shipped the U.S. 2.26 billion square meter
equivalents of clothing. Mexico shipped us 1.1 billion square meter
equivalents.
Let me also comment as the ranking member on the Committee on the
Budget on the revenue losses, the budgetary impacts of this bill. It
results in substantial revenue losses. To get around these revenue
losses and the pay-go rules, this bill uses a low-ball estimate from
CBO, then it uses a contrived accounting technique.
Mr. Speaker, all we have is the choice to vote this bill up or down,
and I say we should vote it down.
Mr. RANGEL. Mr. Speaker, I yield myself the balance of my time. Let
me thank my colleagues that have come to the floor in support of this
bill. Listening to the debate, one might believe that Cuba is a threat
to our national security and now the CBI is a threat to our national
economy. We are dealing with friends. Someone said that should not
matter, that we are dealing with trade. But when we deal with friends,
if they have a problem with the economy, we have been known to provide
leadership in this hemisphere, even to the point that the American
people and this Congress has seen fit to send troops to this part of
the world in order to maintain peace. For decades, we have sent money
there in terms of aid. Now they are coming and saying that in lieu of
these things, they just want to be trading partners with us.
Mr. Speaker, for those who visit the islands, going into a retail
store is like going into a store in the United States if they are
looking to see where the products have been manufactured, where they
have been shipped from. I suspect after this debate is over, we soon
will be hearing from those American companies that hire American
workers that export these retail goods to our friends in the Caribbean.
We have just been hit hard with the crisis that they have had with
bananas, where we have taken the case to the WTO, the World Trade
Organization, which gave a negative decision as relates to the
Caribbean. They work hard every day. These are not people that are
known to have slave labor. These are independent countries, literate
countries. They work hard, they have labor unions, and there are
provisions in the bill that provide for labor rights. But something
that concerns me, too, is that these small islands out there in the
Caribbean are really vulnerable to the international drug traffickers.
They have fought against this and their countries have not succumbed as
we have to become addicted to these drugs, even though corruptions have
hit some part of the countries as relates to transshipment of drugs.
The gentleman from New York [Mr. Gilman] and I have traveled in this
part of the world and we have seen the impact. It seems to me that we
just do not slap friends in the face at a time like this when so much
of their own money has been protecting their borders against drugs
coming in which is basically consumed by us.
Mr. Speaker, I ask my colleagues to support this bill. It is the
right thing to do. It is the fair thing to do. The President wants it.
I think we owe it to the people in that part of the world.
Mr. ADERHOLT. Mr. Speaker, I rise today to voice my serious concerns
about H.R. 2644. I have heard from many folks in my district who work
in the textile industry who oppose this bill in its present form. I
have also been contacted by some, such as Fruit of the Loom, who
support the Senate version and are hopeful that passage of H.R. 2644
will be a step toward enacting a fairer version of free trade for the
Caribbean region.
Which brings me to my concern about H.R. 2644 being brought up under
the Suspension Calendar. I believe that this bill in its present form
raises too many concerns, and that these concerns would be better
addressed if H.R. 2644 was to be brought to the floor with a rule
allowing the necessary changes to be made.
H.R. 2644 in its present form will unilaterally provide Caribbean and
Central American countries parity with Mexico under the North American
Free Trade Agreement [NAFTA]. I fear that this legislation would
inflict further damage on our Nation's textile and apparel industries,
which have lost 250,000 jobs since 1994.
Furthermore, it is my understanding that the premise of this
legislation, that Caribbean-Central American countries have been harmed
by NAFTA, is erroneous. While U.S. employment, particularly in the
apparel industry, is plummeting, apparel imports from Caribbean-Central
America are surging. The U.S. textile industry should not be subject to
the same upheaval the apparel industry had to go through under NAFTA.
Simply put, it is bad economic and trade policy to grant countries
unilateral, free access to the U.S. market without obtaining reciprocal
access to foreign markets. I support free trade--but in the end--it
must be fair trade.
Mr. KLECZKA. Mr. Speaker, I rise today to strongly object not only to
the legislation before us, but to the tactics being used to push this
bill through the House.
On October 8, the Ways and Means Committee, on which I serve, passed
by voice vote this bill to extend North America Free Trade Agreement
benefits to Caribbean and Latin American nations. I requested a
recorded vote in committee, but was denied this request.
Now, the leadership of the House is trying to slide this measure by
the full House in a similar manner by putting the bill on the
Suspension Calendar. It is generally known that the Suspension Calendar
is reserved for noncontroversial legislation, and that bills considered
under suspension of the rules pass by voice vote. H.R. 2644 is highly
controversial and ought to have full, open debate afforded to other
bills of this magnitude.
CBI parity has been rejected over and over by Congress because it is
an expansion of the failing NAFTA. But, this year the debate on CBI
parity is overshadowed by the larger discussion of fast track
authority. We must not let this happen.
NAFTA has hurt, not helped, the American worker. Passage of CBI
parity will further jeopardize jobs and exports by opening the door to
textiles and apparel made with cheap labor and in substandard working
conditions. Plus, the taxpayer is hit with a double blow in lost
revenues. Once parity is offered for a year to these countries, you can
bet there will be a strong effort to renew this legislation when it
expires.
For these reasons, we should reject H.R. 2644 and keep American jobs
at home.
Mr. TOWNS. Mr. Speaker, we have a unique opportunity today to assist
American business as well as supporting economic development in the
Caribbean. The Caribbean basin is now the 10th largest export market
for the United States greater than even some European countries. Our
U.S. exporters maintain a trade surplus with the Caribbean and have
done so for the past 11 years. Additionally, every 100 jobs in the
Caribbean apparel sector creates 15 apparel jobs in the United States.
Additional American jobs are also created in the textile, distribution,
and retail sectors.
We must acknowledge, Mr. Speaker, that NAFTA has been detrimental to
the Caribbean. According to the ITC, Mexico's share of the garment
assembly market has increased 50 percent, while the Caribbean share has
dropped by 15 percent, since 1993. The Caribbean Textiles and Apparel
Institute reports that, between 1995 and 1996, more than 150 apparel
plants closed in the Caribbean resulting in the loss of 123,000 jobs.
The bill before us today, H.R. 2644 will level the playing field for
the Caribbean. It will ensure that Caribbean countries are prepared to
meet their obligations, ranging from market access to intellectual
property rights, as part of the free trade area of the Americas. To
participate in this program, CBI countries must satisfy the additional
criteria of adherence to internationally accepted rules of
international trade and the observance of internationally recognized
workers rights. I would urge my colleagues to support the bill and I
urge its passage under suspension of the rules.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Illinois [Mr. Crane] that the House suspend the rules
and pass the bill, H.R. 2644.
The question was taken.
Mr. CARDIN. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 5 of rule I and the
Chair's prior announcement, further proceedings on this motion will be
postponed.
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