[Congressional Record Volume 149, Number 39 (Tuesday, March 11, 2003)]
[Senate]
[Pages S3516-S3517]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HOLLINGS:
  S. 592. A bill to establish an Office of Manufacturing in the 
Department of Commerce, and for other purposes; to the Committee on 
Finance.
  Mr. HOLLINGS. Mr. President, the Department of Labor, recently 
released the latest unemployment results and at first blush, the 5.8 
percent figure, while certainly too high, does not seem overly 
alarming. It is only with a look behind the numbers that some 
disturbing trends become apparent.
  February marked the 31st consecutive month, since July 2000, that 
manufacturing employment has declined. This is the longest consecutive 
monthly decline in the post World War II era. Already, more than 2 
million manufacturing jobs are gone. A generation ago, in 1974, 
manufacturing workers were 26 percent of the workforce, today they 
account for only 12.5 percent of the workforce.
  For all of 2002, industrial production fell 0.6 percent following a 
3.5 percent decline in 2001. That represented the first back-to-back 
annual declines in industrial output since 1974-1975.
  Unfortunately, no end is in sight. By some measures, the 
manufacturing job loss is twice as bad as the last recession in the 
early Nineties. The 2002 Producer Price Index revealed the worst 
deflation in producer prices since 1949, suggesting that there is 
little incentive to restart the shuttered factories.
  Prices for manufactured goods were down 1.5 percent in December from 
a year earlier. Next to a 1.6 percent year-to-year drop in November, it 
was the largest decline of such prices on record going back to 1958. 
And all this has occurred against the backdrop of 2 years of 
substantial fiscal stimulus and the most aggressive monetary policy in 
anyone's memory.
  But this wasn't suppose to happen. Globalization was going to create 
a gentle prosperity that would create jobs, lift our standard of living 
and improve our communities. During the Clinton era, we entered into a 
series of international trade agreements, most notably NAFTA, WTO and 
China's entrance into the WTO, designed to increase trade and stimulate 
manufacturing job creation.
  The second Bush administration continues this policy, trotting around 
the globe negotiating, free-trade agreements within every region of the 
world. Recently, the administration concluded agreements with Singapore 
and Chile.
  After nearly a decade of the NAFTA/WTO free-trade experiment and 
after a year of ``recovery'', it seems appropriate to review whether 
this free trade era is working? The answer is clearly no.
  Our factories have been swamped by a flood of imports. Each month 
seems to bring a record trade deficit and more stories of plants 
closing and moving offshore.
  Our communities, particularly the rural ones, are quite literally 
emptying out. During the nineties, imports soared by more than 107 
percent. Our trade surplus with Mexico dissolved soon after NAFTA went 
into effect. From 1991 to 2001, our trade deficit went from $77 billion 
to $427 billion, costing us hundreds of thousands of jobs.
  Essentially, our trading partners are exporting their unemployment to 
us. Recently, Ed Yardeni, chief investment strategist of Prudential 
Securities, noted that while the United States currently has 16.3 
million manufacturing jobs, some 20 million rural Chinese move to seek 
better-paying manufacturing and construction jobs in the cities, each 
year.

  There seems to be no end in sight to pain being experienced by our 
manufacturing sector. Even a declining dollar is not improving our 
trade situation, as our factories race to re-establish overseas. It 
seems like recognizing

[[Page S3517]]

where our problem is coming from would be a good first step toward 
solving it.
  So today I introduce legislation designed to help get American 
manufacturing off the canvas. It is broad and wide ranging.
  The legislation would eliminate the tax benefits associated with off-
shore production, whether its by a United States or foreign-based 
company. It would eliminate the incentives for companies to move their 
headquarters outside of the United States. It would prevent the Export 
Import Bank or the Overseas Private Investment Corporation from funding 
any project that did not contain at least 80 percent U.S. content. It 
would eliminate the International Trade Commission. It would provide 
for an additional 500 Customs agents to enforce the tariff and quota 
rules associated with the textile trade. It would prohibit the sale in 
interstate commerce of any manufactured product made by anyone under 
twelve. It would reform WTO dispute settlement by establishing a panel 
of Federal judges to review the determinations that these dispute 
panels are reaching. It would express the Senate's strong support for 
the Byrd amendment which returns anti-dumping monies to injured 
parties. Finally, the legislation would extend the Buy America 
provisions for the Defense Department contained in the Berry amendment 
to the newly formed Department of Homeland Security.
  It's just a start, but we have to begin the process of rejuvenating 
the American manufacturer.
                                 ______