[Congressional Record Volume 149, Number 94 (Tuesday, June 24, 2003)]
[Senate]
[Pages S8426-S8429]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
MEXICAN BARRIERS TO IMPORTS OF U.S. AGRICULTURAL PRODUCTS
Mr. GRASSLEY. Mr. President, it has been almost 10 years since the
North American Free Trade Agreement--NAFTA--went into effect. Overall,
this agreement has been a great success for America's farmers and
ranchers. Between 1994 and 2002, U.S. Agricultural exports to Mexico
grew by 95 percent.
Mexican agriculture has benefited as well from NAFTA. Exports of
Mexican agricultural products to the United States increased by almost
97 percent from 1993 to 2001. At the present time, some 78 percent of
all agricultural products exported by Mexico are sent to the United
States, making the United States by far the largest market for Mexico's
agricultural exports. Clearly, the agricultural sectors of both the
United States and Mexico have on the whole profited from NAFTA. For
this reason, I am confounded by some of the recent actions of the
Mexican government that undermine the spirit, if not the letter, of
NAFTA.
Allow me to elaborate on some of these actions. Mexico has recently
imposed, or threatened to impose, trade barriers to a wide variety of
U.S. agricultural products. These products include pork, beef, corn,
high fructose corn syrup, rice, apples, and dry beans. Apparently
ignoring that increased competition in the Mexican market has benefited
that country's consumers, some in Mexico have spoken of renegotiating
the agriculture provisions of the NAFTA. Mexico's measures against U.S.
agricultural products have certainly caught the attention of many
members of the Senate, including me.
Let me explain Mexico's actions that are directly impacting producers
in my state of Iowa.
I'll start with high fructose corn syrup. It's true that U.S.
producers of agricultural products have, on the whole, benefited from
NAFTA. And, at one point, that was the case with U.S. producers of high
fructose corn syrup. Mexico was formerly the largest export market for
U.S. produced high fructose corn syrup. But in January 2002, the
Mexican Congress imposed a tax of up to 20 percent on soft drinks
containing high fructose corn syrup.
This move was undoubtedly intended to provide Mexican sugar producers
with an unfair advantage in the Mexican market over U.S. high fructose
corn syrup producers. As a result of this discriminatory tax, U.S.
exports of high fructose corn syrup to Mexico are now at almost zero
levels.
Mexico's high fructose corn syrup tax was imposed following WTO and
NAFTA panel rulings that found that a 1998 Mexican antidumping order on
U.S. high fructose corn syrup did not comply with Mexico's trade
obligations.
Clearly, Mexico is going out of its way to prevent the sale of high
fructose corn syrup in its market. Mexico's high fructose corn syrup
tax is causing great harm to U.S. corn producers and U.S. high fructose
corn syrup manufacturers. The U.S. corn refining industry estimates
that it is losing up to $620 million annually on account of Mexico's
discriminatory tax. It estimates that U.S. corn farmers are losing over
$300 million each year due to lost sales to both U.S. and Mexican high
fructose corn syrup producers.
I find it especially ironic that Mexico, a country that is actively
seeking foreign investment, is treating so poorly the U.S. high
fructose corn syrup industry, an industry that has invested heavily in
Mexico.
Based upon the promises of NAFTA, U.S. high fructose corn syrup
producers made major investments in the United States and Mexico.
Mexico has now pulled the rug out from under them. This certainly
sends, at best, mixed signals to foreign investors.
Let me give you another example of Mexico's actions against U.S.
agricultural products, this one impacting Iowa's pork producers. In
January of this year, Mexico initiated an antidumping investigation on
U.S.-produced pork. The petition that initiated this investigation has
serious deficiencies. for example, the petition was filed by Mexican
hog producers, not pork processors, so it is my understanding that the
party bringing the case lacks standing under the Antidumping Agreement
of the WTO.
While Mexico's antidumping investigation on pork is ongoing, I
recognize that Mexican officials last month terminated the Mexican
antidumping order on imports of live hogs from the United States. I am
pleased with Mexico's decision regarding the live hog order. I strongly
hope that this decision provides an indication that Mexican officials
will act reasonably and not impose an antidumping order on U.S. pork.
But there are other problems. Large quantities of U.S.-produced pork
have been rejected at the Mexican borer during the past year due to
alleged sanitary problems. But millions of Americans consume U.S.-
produced pork each day, and we know that this product is safe. Mexico's
rejection of U.S. pork for non-scientific reasons violates Mexico's WTO
obligations.
Iowa's beef producers are also being harmed by Mexico's actions. In
April 2000, Mexico imposed antidumping duties on imports of U.S. beef,
and this trade measure remains in place. Mexico's investigation
resulted in numerous probable violations of Mexico's commitments under
the WTO Agreements. On June 16, the U.S. Trade Representative announced
that the United States is filing a case at the WTO over Mexico's
antidumping order. I fully support the U.S. trade Representatives's
actions at the WTO regarding this matter.
Despite the ongoing Mexican antidumping order on U.S. beef, Mexican
cattle producers earlier this year filed a safeguard petition on beef
from the United States.
Mexican officials have neither confirmed nor denied the existence of
this petition. Lack of certainty with regard to this safeguard petition
has made it even more difficult for the U.S. cattle and beef industry
to plan sales in Mexico.
[[Page S8427]]
White corn producers in Iowa are also threatened by potential Mexican
trade actions. Mexican officials are hinting at initiating a safeguard
investigation on imports of U.S. white corn. In addition, these
officials have suggested limiting import permits for white corn for
periods of short supply. Such a policy would not comport with Mexico's
NAFTA obligations.
Mexico's actions, and threatened actions, against U.S. agricultural
products such as high fructose corn syrup, pork, beef, and white corn
are having real effects on U.S. producers. Sales in Mexico are being
lost or threatened. Uncertainty is making it difficult for U.S.
producers to plan for future sales in Mexico.
But Mexico's actions are having a broader effect than lost sales.
Mexico's policies are indirectly threatening the entire U.S. trade
agenda.
Most of U.S. agriculture was solidly behind the passage of the NAFTA.
But with Mexico failing to abide fully with its NAFTA commitments, many
U.S. producers are beginning to question the worth of trade agreements.
If America's farmers and ranchers back away from their strong support
for new trade agreements, the U.S. trade agenda will lose its biggest
proponents. And if the United States falters in its support for trade
liberalization, the whole world will suffer.
Given the importance of maintaining the U.S. trade agenda, I urge the
administration to make the removal of Mexican barriers to U.S.
agricultural products a top priority. The U.S. Government must not
overlook systematic efforts by Mexico to keep U.S. farm products out of
the Mexican market in disregard of Mexico's international trade
commitments.
Finally, I urge Mexican officials to think twice about the effects of
their decisions involving U.S. agricultural products. Mexico's actions
are threatening that country's trade relations with its largest export
market. Damaged trade relations between the United States and Mexico
are certainly not in the best interests of either country.
NAFTA can, and will, continue to provide great benefits to farmers,
ranchers, and consumers on either side of the border. But this trade
agreement will work only if all parties to it abide by their NAFTA
commitments.
The PRESIDING OFFICER. The Senator from Illinois.
Mr. DURBIN. Mr. President, I ask unanimous consent to be recognized
as in morning business.
The PRESIDING OFFICER. Without objection, it is so ordered.
IMMIGRATION AND DRUG COSTS
Mr. DURBIN. Mr. President, one of the most fascinating aspects of
this job in the Senate is the myriad of issues that come before us in
the course of a day or week. If you followed over the last few moments
the two speakers--one from Alabama and one from Iowa--they both were
speaking about related issues.
My friend from Iowa and I share an interest in agriculture. His State
and mine lead the Nation in the production of corn and soybeans, and
naturally we try to export our goods to expand our trade. And he is
concerned--and I share his concern--about Mexico. We both voted for the
North American Free Trade Agreement in the belief of opening up--and it
has opened up--trade substantially between these two neighboring
countries, the United States and Mexico. But we have run into some
problems here, problems related to corn, as my colleague from Iowa
noted, whether we can export white corn to Mexico, which, of course, is
a major staple of their diet, being the basis for tortillas, part of
the Mexican cuisine, and also whether we can export a product made from
corn called high fructose sweetener.
For people who may not be familiar with that term, trust me,
virtually every soft drink that you consume in America has high
fructose sweetener in it rather than sugar. We want to sell it in
Mexico, and they do not want us to sell it there. Frankly, they want to
export more sugar to the United States.
So this trade battle is on. The Senator from Iowa is right, this has
been going on too long, and it has to come to an end.
I would say to our friends in Mexico--and they are our friends and
allies and neighbors--we have to resolve this.
We have to resolve it equitably and honorably, but it has to be done
with dispatch. So I certainly support what the Senator from Iowa said.
Now, before he spoke, the Senator from Alabama got up to speak about
immigration. And here is the story, as I see it, related to this trade
issue.
If the farmers in Mexico--who are struggling to grow their crops,
with much less efficiency and productivity than the farmers in the
United States--are unsuccessful in their farms, many of them move to
the city. It is very common. It happens throughout the developing
countries of the world. If they move to the large cities in Mexico and
they cannot find a way to sustain their families, there is an
alternative: El Norte. They head north. And we have seen a dramatic
migration from Mexico to the United States.
In the last 10 years, my State of Illinois has seen a substantial
increase in the Mexican-American population. I know it; I see it; I
feel it. It is now part of our life in Illinois. The people who have
come here I have found overwhelmingly to be some of the finest people I
have ever had a chance to meet. It takes real courage to get up and
leave your village, your family, your church, your language, your
tradition, and to head thousands of miles north into the bitter cold,
trying to find a job, to make enough money to sustain yourself and
maybe sending back some money to your family in Mexico. Thousands have
done it. Many have done it undocumented and illegally, and that is
another issue.
I will say, it is naive for us to believe these undocumented
immigrants to the United States have not become an integral part of our
economy. They are. A leading restaurateur in Chicago said to me: If you
removed all of the undocumented people from the restaurants of this
great city, you would have to close them down. Every time you turn
around and see who is washing the dishes, busing the tables, doing the
work--some of the hardest work in my State and others--you will find a
lot of people who are here perhaps without legal documentation.
A few minutes ago, the Senator from Alabama said he objected to a
provision in the bill we have been debating, S. 1, the prescription
drug bill, because this provision says that those women who are legally
in the United States--legally in the United States--would be able to
qualify for Medicaid coverage and their children for basic health
insurance coverage if a State decided to offer that coverage.
That is what the bill says. So if the State of Missouri or the State
of Illinois or Iowa or Alabama says: We are not interested in offering
Medicaid coverage to legal immigrants who have not been here 5 years--
legal immigrant women--then they do not have to. Twenty States have
decided, though, it makes good sense to go ahead and enroll these legal
immigrant women and their children into Medicaid at their own expense.
Why would a State Governor and legislature decide to pick up and
cover these people? Well, for obvious reasons. Women who come to this
country in a legal immigrant status often become pregnant and during
the course of that pregnancy need prenatal care. If they do not receive
prenatal care during their pregnancy they could end up with
complications in the pregnancy or some serious illness facing the
child.
Now, Governors and legislatures have said it is far better for us to
offer prenatal care to that legal immigrant woman and her child, once
born, than to run the risk they are going to be unhealthy, not only for
their own sakes but for the cost it would bring to society. I think
that is perfectly sensible.
The Senator from Alabama objects. He says we should not give States
the option to provide, with Federal assistance, that kind of medical
care. I think that is a mistake. I think the bill is right. The bill
understands that these women, during their pregnancy, are carrying
future American citizens. Those babies, once born on our soil, are
citizens.
Is it important for us to make sure--or do the best we can to make
sure--those mothers are healthy and the babies are healthy. Well, if
not for the sake of humanity, certainly from an economic point of view
it is. A sick baby is not only a family tragedy, it becomes a social
cost. So this bill, by giving to States the option of offering Medicaid
to legal immigrant women and health insurance to their children,
[[Page S8428]]
once born, I think just makes common sense.
It will be interesting to watch the vote tomorrow to see how many
Senators in this Chamber, who feel very strongly about the so-called
pro-life position, who want to make certain that we avoid abortions and
that we honor the children who are being born, join the Senator from
Alabama in denying prenatal care to legal immigrant women and denying
their babies, once born, health insurance.
I would think it is obvious, whatever your position on the issue of
abortion, that if you believe in families, you would vote against the
amendment by the Senator from Alabama.
Let me just say very briefly, when I was a young student, I read a
Sherlock Holmes book that I still remember. It was entitled ``The Dog
That Didn't Bark.'' Sherlock Holmes solved this mystery by not hearing
something but by realizing that he hadn't heard something. The
witnesses to this crime had not heard a dog bark. And that was an
important piece of evidence for him to determine what happened that led
up to the actual murder.
The reason I remembered that is I am listening carefully to this
national debate on the floor of the Senate about a prescription drug
bill. I am waiting for the barking of the pharmaceutical lobby. Where
are the drug companies? Why haven't we heard from the drug companies?
This is a bill that will affect some 40 million senior citizens and
provide assistance for them to pay their prescription drug bills, and
the drug companies are silent. Why? There are two reasons for it.
First, they believe the passage of a Federal prescription drug
benefit is going to reduce the likelihood that more and more States
will establish their own State prescription drug plans, bringing down
the cost of prescription drugs in each State. I commend to those who
follow it a ``Frontline'' program of last week on public television
that analyzed this.
As the States of Maine and Oregon and my State of Illinois and others
developed prescription drug plans, the pharmaceutical industry
challenged them in court, particularly in the case of Maine, and lost
the challenge.
So it was at that point that they became more intent on seeing us
pass a prescription drug benefit on a national level to try to diffuse
this growing public sentiment against increasing drug prices and the
growing public sentiment that local and State legislatures had to act
on this because the Congress was inept, unable to do it.
So we have this bill before us that is one of the reasons why the
pharmaceutical lobby has been strangely silent during this debate. They
are happy that we are considering a Federal prescription drug benefit
program.
The second reason is even more important. This bill, S. 1, before us
now for consideration, is a pretty long bill. As a matter of fact, it
is 654 pages long. You will have to search this bill line by line and
page by page and I am afraid you will find that after that search,
there are few, if any, efforts in this entire bill to control the
runaway cost of prescription drugs. So the pharmaceutical companies see
this as a win/win situation. We pass a national prescription drug
program that takes the heat off the States, and at the same time we do
nothing to reduce the cost of prescription drugs to seniors and others
across America. So these already very successful companies have to view
this as the greatest windfall that has ever come their way.
The Federal Government will pay a percentage of the cost of
prescription drugs, but the Federal Government will do little or
nothing to control the cost of those drugs.
The senior citizens of this country understand this issue far better
than Members of the Senate. In fact, when they were recently asked the
question: What is more important to you, to provide a prescription drug
benefit under Medicare to help you pay for your prescription drugs or
to establish a policy and program that will bring down the excessive
costs and the increasing rise in cost of prescription drugs across the
Nation, by a margin of almost 2 to 1, they said go after the cost of
the drugs. Don't tell me how much you are going to give me if you are
not going to control the cost.
Last year, the cost of prescription drugs went up 10 percent in my
State of Illinois. Nationally, the figures are higher. If those
increases continue, no matter what we pass this week in the Senate, it
will not be enough. The cost of drugs will go off the end of the chart,
and private insurance companies, HMOs that are being lauded by
conservatives, by the President, and the White House as the answer to
our prayers, frankly, don't have the interest or the power to make a
difference in the cost of these prescription drugs. So the seniors will
find themselves at the end of the day with a very limited benefit from
this program.
But hope is on the way. Tomorrow I will be offering an amendment
which is a dramatically different approach to dealing with prescription
drugs. We are going to make cost containment part of our prescription
drug program. We are going to follow the model of the Veterans'
Administration which said, in serving the millions of America's
veterans, drug companies had to give a discount to the Veterans'
Administration on the drugs that were provided, and the drug companies
did--a discount of 40 to 50 percent. This isn't radical or innovative.
It is a fact. This is what is happening.
We believe using the same logic and the same Government effort to
bring competition and lower costs under my amendment will mean that
drug costs will start coming down and this program will go a lot
further in helping seniors. And once the drug costs start coming down,
let me tell you what we can do: This bill does not guarantee a monthly
premium for prescription drug benefits. It suggests $35 a month. But I
think the sponsors will tell you, there is no guarantee that it won't
be $50 or $75 a month for this prescription drug program being offered
by HMOs and private insurance companies under the Grassley-Baucus bill.
Under MediSAVE, which is my alternative plan, we mandate a $35-a-
month maximum monthly premium. Second, there is a $275 deductible
before anybody can get the first dollar in Government benefits under
the Grassley-Baucus bill. Under the amendment I will offer, there is no
deductible. Third, under the Grassley-Baucus bill, they will pay 50
percent of the cost of prescription drugs after the deductible is
applied. Under the MediSAVE Program, which I am going to introduce, it
is 70 percent.
How can I offer all this? How can I offer a program that has no gap
in coverage so that it continues to cover you right up to a $5,000
annual cost in drugs and then you switch over to catastrophic coverage?
How can I do all this? Because I go after the price of the drugs. The
underlying bill doesn't touch the cost of drugs. As a result, $400
billion, as large a sum as that may sound, does not go very far. When
we bring in cost containment, we can offer a real prescription drug
program.
And there is one more thing. The amendment I will offer will allow
Medicare itself to compete with the private insurance companies. I have
listened carefully to the debate for the last week or so. I can tell
you that most of my Republican friends are loathe to concede the
obvious. There is no private insurance company that can effectively
compete with Medicare when it comes to offering prescription
drug benefits. Why? Because Medicare doesn't have a profit motive.
Medicare has a low overhead. Medicare can bargain on behalf of millions
of seniors to get a formulary or a list of drugs at discount prices.
These private insurance companies cannot do any of those things. They
are out for the profit. They have high administrative costs, and they
won't have the power to bargain down the price of the cost of the
drugs. So by putting Medicare in the mix, saying every senior can
always turn to the Medicare prescription drug program, we have real
choice and real competition and a real scare for the Republicans who
believe that competition only involves private insurance companies.
They don't want a Government agency competing with them.
The amendment I will offer tomorrow has been endorsed by a number of
my colleagues on this side of the aisle, as well as the AFL-CIO, the
United Auto Workers, a variety of unions across the United States, as
well as senior citizens organizations. They understand this is a real
prescription drug benefit program that tries to keep the costs
[[Page S8429]]
under control and makes sure we maximize the benefits to seniors across
the United States.
It will be interesting to note the vote tomorrow. I believe there
have been clear indications that many people here are not going to do
anything to ruffle the feathers of the drug companies and
pharmaceutical lobby. I hope they will keep in mind that the senior
citizens they represent understand full well that these drug companies
are the most profitable companies in America.
They can bring down costs. They have done it in Canada and in other
countries. They can still make enough profit to reward shareholders for
their risk and have money left to invest in research. I hope this
MediSAVE amendment will have the positive response of my colleagues
tomorrow when it is offered on the floor.
I am prepared to yield the floor at this time, and I suggest the
absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. FRIST. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
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