[Congressional Record Volume 148, Number 122 (Tuesday, September 24, 2002)]
[Senate]
[Pages S9107-S9108]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    U.S. INTERNATIONAL TRADE POLICY

  Mr. GRASSLEY. Mr President, this year marks an historic turning point 
for U.S. international trade policy. For the first time in over eight 
years the Congress renewed the President's authority to negotiate new 
trade agreements. This authority, called Trade Promotion Authority, 
reestablishes the traditional partnership on trade between the Congress 
and the Executive branch. It allows us to work together to open new 
markets for American exports, set fair rules of conduct for U.S. 
investors overseas, and help raise the standard of living for millions 
of people around the world.
  The negotiating objectives and procedures laid out in the Bipartisan 
Trade Promotion Authority Act represent a very careful substantive and 
political balance on some very complex and difficult issues such as 
investment, labor and the environment, and the relationship between 
Congress and the Executive branch during international trade 
negotiations.
  Because this balance is so delicate, I was somewhat dismayed to learn 
recently that some groups and Members of Congress are trying to push 
for interpretations of certain provisions of the TPA bill that do not 
comport with the negotiating objectives laid out in the Bipartisan 
Trade Promotion Authority Act. For example, an article in the September 
18, 2002 edition of National Journal's CongressDaily noted that ``a 
group of labor officials who were active in the fight against, TPA, are 
meeting in the offices of the AFL-CIO. At the top of their agenda: 
mapping a plan to ensure future trade agreements include strong 
provisions on labor rights and the environment. Labor officials plan to 
hold future agreements to standards set in an earlier free-trade 
agreement reached with Jordan, which they consider a model of backing 
up labor and environmental provisions with enforceable sanctions.'' 
Some Members of Congress are even arguing that future agreements must 
follow the ``Jordan Standard'' on labor and environment in order to 
meet the objectives laid out in the TPA bill. Perhaps even more ominous 
were the public remarks of the Chairman of the Senate Finance Committee 
who urged the administration to follow the model of the Jordan Free 
Trade Agreement ``exactly'' in implementing the labor and environment 
provisions of the Bipartisan Trade Promotion Authority Act.
  On this issue, I respectfully disagree with my colleague from 
Montana. In fact, I think this would be a serious mistake. The 
negotiating objectives in the TPA bill set the parameters for future 
trade negotiations, not some past agreement like the Jordan FTA that 
was negotiated during the Clinton Administration. To follow the 
provisions of this past agreement ``exactly'' would ignore the clear 
will of Congress as set forth in the TPA bill. Even more disconcerting 
is that such a stark litmus test ignores that basic premise that the 
most appropriate mechanisms to improve labor and environment standards 
abroad differ from country to country and agreement to agreement. In 
short, one size does not fit all.
  Trying to solve complex environmental and labor issues with rigid 
constructs will do nothing to actually improve environmental or labor 
standards abroad. At the same time, demanding that our trading partners 
accept specific language laid out in past agreements during trade 
negotiations will come at a heavy price for our farmers and workers, as 
our trading partners can demand significant concessions on other 
issues, such as agriculture, in exchange for our rigid insistence that 
they accept specific language from our trade negotiators. The 
Administration and Members of Congress need to remember that the 
underlying premise of the TPA Act is to provide the President and our 
trade negotiators with flexibility so they can negotiate the best trade 
agreements for the American people. It is not intended, nor should it 
be used, to try to tie the President's hands on any particular issue.
  It is also troubling that some advocacy groups are pushing to ensure 
that future free trade agreements adhere to their version of so-called 
``Jordan Standard.'' I think it bears repeating that it is the 
negotiating objectives laid out in the Trade Promotion Authority bill 
that should guide the Administration in future trade negotiations, not 
a single free trade agreement that was concluded long before TPA became 
law.
  I also believe it would be a political miscalculation to insist that 
new trade agreements must follow the ``Jordan Standard'' to gain 
support in Congress. First, no one really knows what the ``Jordan 
Standard'' is. In fact, when we held a hearing on the Jordan Free Trade 
Agreement on March 20, 2001 in the Senate Finance Committee, one of the 
most controversial issues raised was what the labor and environmental 
provisions of the Jordan Free Trade Agreement actually mean. For 
example, former United States Trade Representative Charlene Barshefsky 
testified that the labor and environment provisions in the Jordan FTA 
``while

[[Page S9108]]

restating the existing commitment of both countries to environmental 
protection and the ILO's core labor standards, neither imposes new 
standards nor bars change or reform of national laws as each country 
sees fit.''
  Ambassador Michael Smith, former Deputy United States Trade 
Representative and the first American Ambassador to the General 
Agreement on Tariffs and Trade, testified that ``Articles 5 and 6 [of 
the Jordan FTA] as written are largely fluff, open to widely differing, 
even if plausible, interpretations and, as such, causes for possible 
unfortunate differences between Jordan and the United States in the 
years ahead as the agreement is implemented. Articles 5 and 6 do not 
advance the ``cause'' of either international environmental or labor 
affairs and add only confusion to what should be a straightforward free 
trade agreement. Indeed, the only result I can foresee is countries 
adopting lower environmental and labor standards for fear of themselves 
being unable to effectively enforce higher standards hardly a desired 
result.''
  During the hearing it became clear that labor and environment 
provisions, and their relationship to the dispute settlement procedures 
established in the Jordan FTA, are highly controversial. A number of 
groups, including the American Farm Bureau Federation and the U.S. 
Chamber of Commerce, strongly opposed including the labor and 
environment provisions in the Jordan FTA without some clarification 
from the Administration that these provisions would not be implemented 
in a trade restrictive manner. Many members of the Republican party, 
including myself, shared these concerns. Had the U.S. Government not 
agreed to side letters with the Hashemite Kingdom of Jordan, clarifying 
that these and other provisions would not be implemented in a manner 
that results in blocking trade, it is highly likely that the agreement 
would not have gained the support of the Republican caucus in the 
Senate, and may not have passed the Senate at all. And, if the proposed 
agreement had not been with our good friend and ally Jordan, side 
letters may not have been enough.
  I think this represents an important political reality which the 
Administration must gauge in entering into new free trade agreements. 
Almost 90 percent of the Republican Caucus in the House and Senate 
supported passage of Trade Promotion Authority. In contrast, only 12 
percent of the House Democratic Caucus and 40 percent of the Senate 
Democratic Caucus supported the bill. And the price for that support 
was high. Clearly, if future free trade agreements are going to pass 
Congress, the strong support of the Republican caucus will be key.
  In short, I am deeply concerned that some advocacy groups and Members 
of Congress are pushing the Administration to adhere to a highly 
controversial and vague ``Jordan Standard'' which does not have the 
strong support of the Congress and that is not clearly reflected in the 
Trade Promotion Authority negotiating objectives. While the labor, 
environment, and dispute settlement negotiating objectives in the 
Bipartisan Trade Promotion Authority Act are loosely based on 
provisions found in the Jordan Free Trade Agreement, there is clearly a 
distinction between the two. In implementing the will of Congress as 
embodied in the Trade Promotion Authority Act, it is critically 
important for the administration to keep this distinction in mind if 
future agreements are to gain the support of myself and other strong 
supporters of free trade in the Congress.
  Before I conclude I would like to talk about another important 
development in U.S. trade policy. Last week, for the very first time, 
the bipartisan, bicameral Congressional Oversight Group, COG, met with 
Ambassador Zoellick to discuss pending and future trade agreements. The 
COG was created by the Trade Promotion Authority Act to provide an 
additional consultative mechanism for Members of Congress and to 
provide advice to the U.S. Trade Representative on trade negotiations.
  The COG is comprised of: the Chairmen and Ranking Members of the 
Finance and Ways and Means Committees; three additional members from 
the Senate Finance Committee, no more than two of whom may be of the 
same political party; three additional Members of the House Ways and 
Means Committee, no more than two of whom may be of the same political 
party; and the chairman and ranking member or their designees of the 
committees of the House or Senate which would have, under the Rules of 
the House or Senate, ``jurisdiction over provisions of law affected by 
a trade agreement negotiations for which are conducted at any time 
during that Congress.''
  The purpose of the COG is to ``consult and provide advice to the 
Trade Representative regarding the formulation of specific objectives, 
negotiating strategies and positions, the development of the applicable 
trade agreement, and compliance and enforcement of the negotiated 
commitments under the trade agreement.'' In addition, each member of 
the COG is to be accredited as an official adviser to the United States 
delegation in the negotiations. However, those Senators or Members who 
are Members of the COG because they are the chairman or ranking member 
of a Committee which has ``jurisdiction over provisions of law affected 
by trade negotiations'' are to be accredited as advisors only on those 
provisions which would fall under their Committee's jurisdiction.
  The TPA bill makes it clear that the COG is a mechanism for enhanced 
consultations and that it is not designed to serve as a referendum on 
new agreements or on particular negotiating positions.
  I am pleased to report that our first meeting was a great success. A 
number of Senators and Members of the House from both political parties 
attended the meeting, including the chairmen and ranking members of 
both the Senate Finance and House Ways and Means Committees. During the 
meeting Ambassador Zoellick expressed his strong support for enhanced 
consultations and his keen interest in meeting with the COG on a 
regular basis. I certainly would support his enthusiastic efforts.
  The TPA bill also requires the chairmen and ranking members of both 
the Finance and Ways and Means Committees to establish guidelines for 
the exchange of information between the Congress and the Executive 
branch. I plan to work diligently to ensure that these guidelines are 
feasible and that the resulting exchange of information is meaningful.
  With the passage of the Bipartisan Trade Promotion Authority Act of 
2002, we begin a new phase in the history of U.S. trade policy. 
Although the bill contains some new buttons and bows, the underlying 
premise of the bill remains the same as it was decades ago to give the 
administration the tools it needs to liberalize trade and create new 
opportunities for America's farmers, ranchers and workers. As the 
Ranking Member of the Senate Finance Committee, I intend to ensure that 
the Trade Promotion Authority Act is implemented in a manner that does 
just that.

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