[Congressional Record Volume 148, Number 30 (Friday, March 15, 2002)]
[Senate]
[Page S1970]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    SETTLING THE SOFTWOOD LUMBER DISPUTE: POSSIBILITIES AND PROBLEMS

  Mr. KYL. Mr. President, the Bush administration is currently involved 
in negotiations to settle a dispute regarding the importation of 
Canadian softwood lumber.
  Softwood lumber is essential for building quality, affordable homes 
in the United States.
  Its price and availability have a major impact on the U.S. economy, 
workers and consumers. The U.S. homebuilding industry employs 6.5 
million people. The Census Bureau estimates a price increase of $1,500 
for the average new home--expected if an export tax or duty is imposed 
on Canadian softwood lumber coming into the U.S.--which would prevent 
approximately 450,000 families from qualifying for a home mortgage. 
These families are likely to be less advantaged groups in the 
population.
  Quite simply, Canadian softwood lumber is needed here. It has 
different qualities than the lumber produced in the U.S. and is used 
for different purposes. The southern yellow pine produced in the U.S. 
cannot replace Canadian spruce-pine-fir, which is used by American home 
builders for interior walls. These homebuilders use U.S. southern 
yellow pine for decks and flooring because of its strength and ability 
to accept hard treatment. But if southern yellow pine were used in 
interior walls, unlike Canadian spruce-pine-fir, it could twist, warp 
and shrink causing nails to ``pop.'' Obviously, this would result in 
problems for home builders and consumers.
  There are a number of proposed settlements that raise legal and 
practical concerns. These proposed settlements range from the 
imposition by the Canadian government of an ``export tax'' on the sale 
of Canadian lumber to U.S. companies, to mandated minimum prices 
established by both governments. Such settlements will cause volatility 
in lumber markets without adequately considering the disadvantages for 
U.S. consumers.
  I urge the administration to base its decision on existing U.S. and 
international trade law, and I implore the administration to exclude 
from any settlement provisions that would impose a de facto, foreign 
country-imposed sales tax on U.S. homebuyers.

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