[Congressional Record Volume 149, Number 116 (Thursday, July 31, 2003)]
[Senate]
[Pages S10586-S10588]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




UNITED STATES-SINGAPORE FREE TRADE AGREEMENT IMPLEMENTATION ACT AND THE 
      UNITED STATES-CHILE FREE TRADE AGREEMENT IMPLEMENTATION ACT

  Mr. BREAUX. Mr. President, I strongly support the Singapore and Chile 
Free Trade Agreements and believe they will promote domestic growth in 
manufacturing and exports. I look forward to seeing these agreements 
enacted into law. However, I am concerned about the current U.S. 
negotiating objective of restricting, limiting or otherwise eliminating 
drawback and duty deferral rights for U.S. manufacturers and exporters 
in free trade agreements, FTA. The administration's current policy 
places U.S. companies at a significant competitive disadvantage in the 
global market.
  Free trade agreements should include no language that eliminates or 
otherwise restricts the application of duty drawback and duty deferral 
programs to U.S. manufacturers and exporters. The language in the 
United States-Singapore and United States-Israel FTAs, for example, 
have no such restrictive language and we should model future agreements 
after these FTAs. This issue is of significant importance to many U.S. 
manufacturers and exporters, including those in my home state of 
Louisiana.
  Duty drawback and duty deferral programs reduce production and 
operating costs by allowing our manufacturers and exporters to recover 
duties that were paid on imported materials when the same or similar 
materials are exported either whole or as a component part of a 
finished product. Duty drawback positively affects nearly $16 billion 
of U.S. exports each year. Additionally, nearly 300,000 U.S. jobs are 
directly related to exported goods that benefit from drawback, and 
these high quality jobs could be adversely affected by eliminating or 
restricting drawback. In my own home state of Louisiana, drawback and 
duty deferral programs provide substantial benefits to local 
industries, allowing them to compete on a level playing field in the 
global market.
  Drawback makes a significant difference to U.S. companies at the 
margin when exporting to our FTA partners where they compete against 
foreign producers that either have substantially lower costs of 
production or enjoy low or zero import duty rates. This export 
promotion program is one of the last WTO-sanctioned programs' which 
provides a substantial advantage to U.S. companies participating in the 
export market. The application of these programs to U.S. manufactures 
and exporters should not be restricted in future free trade agreements 
that we negotiate with our trading partners.
  We need to work hard to complete free trade agreements that provide 
as many competitive advantages as we can to U.S. manufacturers 
competing in the global market, encourage growth in U.S. exports, and 
create U.S. jobs.
  Mr. KOHL. Mr. President, I rise today to explain my opposition to the 
Chile and Singapore Free Trade Agreements. As a former businessman, I 
understand that trade has always been an important part of our economy. 
American workers are so productive that access to foreign markets is 
key to their prosperity. Last year alone the State of Wisconsin 
exported $10.6 billion worth of goods around the world. Unfortunately, 
because the Administration chose to abuse the fast track process and 
include unrelated immigration issues in these agreements, I was not 
able to support these agreements.
  My opposition to these agreements is not based on the tariff 
reductions and market access measures included in the bills. Agreements 
between the U.S. and these countries make good economic sense. Canada 
and Europe already have free trade agreements with Chile and it has 
hurt our access to that market. While U.S. products face a 10 percent 
tariff, the same products from other countries do not. In Wisconsin we 
sell large mining equipment and bulldozers to Chile, but since 2000 our 
sales of mining equipment has tailed off. There may be many reasons for 
this reduction in commerce, but the fact that we face a 10 percent 
tariff, while our competitors from Europe do not, is not helping. This 
agreement will go far toward giving U.S. companies a fair and even 
playing field.
  That said, our trade policy with other countries has been far from an 
unqualified success. Since 2000 Wisconsin has lost 70,000 manufacturing 
jobs. Almost one out of every eight jobs in the state in manufacturing 
has disappeared. Some of this job loss is a result of the recession. 
Some of these jobs have been moved to Mexico, and some of these have 
been unable to compete with low wages in China. Most damaging, however, 
may be the currency manipulation of the Chinese Government. Some 
experts believe the Chinese may be artificially keeping their currency 
undervalued by as much as 50 percent. This means products from China 
are 50 percent cheaper than they would normally be. This is on top of 
low wages and almost no environmental regulations, which also work to 
depress prices.
  Trade can only work when countries obey the rules and follow the law. 
I supported bringing China into the WTO because that would make it 
harder for them to cheat on their agreements. However, this 
administration has proven unwilling to press this currency issue with 
the Chinese. They have allowed the problem to fester unchecked, and our 
manufacturing base is paying the price.
  The agreements before us now, however, are not with countries that 
have a history of avoiding their commitments, or that do not enforce 
their labor laws, or with countries that are ruled by dictatorships. 
Singapore and Chile are responsible democracies with solid labor laws 
and labor unions. In the case of Singapore, the wage rates are 
comparable, although not the same, as the United States. Chile and 
Singapore have little in common with China, and should not be painted 
with the same broad brush. These countries also represent a 
significantly smaller portion of our foreign trade. Singapore 
represents 1.7 percent, and Chile represents 0.3 percent of total U.S. 
Trade, exports and imports combined and opening our market to them will 
have much less impact on our economy than our opening to China.
  Many have criticized these agreements because the labor provisions 
attached to the agreement are not strong enough. A recent United 
States-Jordan Free Trade Agreement had much stronger labor provisions 
than the agreements before us now. That agreement had real 
accountability and real consequences if Jordan failed to keep up its 
side of the bargain. The administration argues that Chile and Singapore 
have responsible laws that are adequately enforced, and so do not need 
the highly prescriptive language that was included in the Jordan 
agreement. I agree with their arguments.
  Let me be clear about the following. While these labor provisions may 
be adequate for Chile and Singapore, countries with good records, they 
should not be used as a model for future multilateral agreements in the 
region. The Free Trade Area of the Americas, and the Central American 
Free Trade Agreement will need substantially stricter labor and 
environmental provisions than these to get my vote. Large multilateral 
agreements with countries that are only fledgling democracies and have 
poor records of protecting workers cannot be treated in the same manner 
as Chile and Singapore.

[[Page S10587]]

  Even though these agreements had problems and were not perfect, I was 
inclined to support them because I generally vote to support free 
trade. I felt these countries would be good partners and these 
agreements would be unlikely to have any significant negative impact on 
our economy. But the administration pushed the envelope of fast track 
too far when immigration provisions were included in the implementing 
legislation.

  Both trade agreements contain provisions which create a new visa 
category for the temporary entry of business professionals. These 
provisions were negotiated as part of the larger trade agreement by the 
United States Trade Representative, USTR, which has no specific 
authority to implement new visa categories or make modifications to our 
temporary entry system. Further, these provisions were negotiated 
without the direction of Congress, which has traditionally debated and 
decided upon our Nation's immigration policy. These actions by the USTR 
set a dangerous precedent for immigration policy to be negotiated 
behind closed doors without a complete debate. Both our Nation's 
security and its diversity depend on well-considered immigration 
policy.
  Second, the administration transmitted the implementing language for 
these trade agreements to the Senate before responding to concerns 
expressed at a Judiciary Committee hearing. This language is 
unamendable once transmitted, so it is critical that Congress be 
consulted fully on implementing language before transmission. 
Immigration policy lies squarely in the jurisdiction of the Judiciary 
Committee; for the administration to finalize immigration language 
before the Judiciary Committee has had a chance to analyze a draft and 
improve the language is an unacceptable way to do business.
  These agreements I have decided to oppose will undoubtedly pass. 
Chile and Singapore have shown they are willing to play by the rules, 
and have democracies who will hold them accountable if they undermine 
their own labor and environmental laws. I expect there will be disputes 
in the future, there always are between partners, but Chile and 
Singapore will work with us to settle those disagreements when they 
come around. However, future agreements with countries with lower 
standards will have to do more to secure labor and environmental rights 
before I will support them. We need to move back toward the United 
States-Jordan model, back toward more accountability in trade 
agreements before this administration can expect my vote in favor of 
FTAA or CAFTA.
  This undermining of the fast-track procedure, however, cannot be 
repeated. I voted for fast track, and support it as a way to give the 
President the ability to negotiate with other countries in good faith, 
but it should not be used for issues that are not trade related. Future 
agreements that carry unrelated provisions will not get my vote. I hope 
the administration hears this message and gets back to the business of 
focusing on our trade agenda, and leaving the immigration issues to the 
Congress where they belong.
  Mr. VOINOVICH. Mr. President, I rise in strong support of S. Res. 
211. I join my colleagues to speak out against the administration using 
these trade agreements to implement immigration policy without the 
authority or direction to do so from Congress. It is the function of 
the Congress to set policy on the immigration laws of this country, and 
in this case, the USTR overstepped its bounds. This resolution sends a 
message to the administration that the USTR has overreached its 
negotiative authority by including immigration provisions in the FTA, 
and in the future, they must consult with Congress before implementing 
new policy, and I strongly support it.
  I am a strong free-trader whose State has benefited from free-trade 
agreements. I do have some concerns, however, about the enforcement of 
trade laws and I have expressed those concerns to the administration. 
Free trade must also be fair and I will continue to pay close attention 
to our trade agreements and their enforcement to make sure that 
American workers are not hurt by unfair trade.
  Mr. CORZINE. Mr. President, I will vote against the free-trade 
agreements, and I want to take a few minutes to explain why.
  Having spent many years in the financial world, I understand the 
tremendous value of trade to America and to nations around the world. 
Free and open trade can enhance prosperity, create jobs, and increase 
opportunity. That is why I supported the North American Free Trade 
Agreement before I came to the Senate. And it is why I supported the 
free-trade agreement with Jordan. Measures like these held the promise 
of greater economic growth to the benefit of citizens in all countries 
involved and represented a growing movement toward freer trade around 
the globe.
  Yet in recent years, we have seen a serious deterioration of the 
trade situation here in the United States, and our Nation's trade 
deficit has grown dramatically. The current account deficit in the 
first quarter of this year increased to more than $136 billion, and 
many project that it will surpass $500 billion this year. That means 
that every day, we are being forced to borrow nearly $2 billion because 
of our trade imbalance. That is a serious problem, and it is simply 
unsustainable. Something is not right with our ability to export 
American goods and services, but particularly manufactured products.
  Beyond the enormity of the trade deficit, American businesses 
increasingly are shipping jobs overseas. Not just low-skilled jobs, but 
professional, highly skilled and well paid jobs. That is one reason the 
so-called economic recovery touted by the Bush administration has 
widely been characterized as a jobless recovery. In fact, it is worse 
than a jobless recovery, it is a job-killing recovery. And while 
workers in this country are losing jobs, our trade policy is helping to 
create jobs overseas. Today, many American firms are outsourcing high-
technology jobs to low-wage environments to the detriment of American 
workers.
  Sadly, this troubling trend has not received enough attention here in 
Washington. It is a matter affecting millions of Americans who are 
looking for work--well-paying, upwardly mobile work. And, I believe, it 
requires a serious rethinking of our Nation's whole approach to trade.
  Unfortunately, the trade agreements considered last night failed to 
address this problem, and I have many concerns about them.
  For example, I am quite concerned about provisions in the agreements 
that effectively overturn U.S. immigration laws and allow thousands of 
foreigners to enter our country to take what will often be highly paid 
positions. These people will take jobs away from Americans who want 
them and need them. And it is especially disturbing that such a 
significant change in immigration laws is being included in a trade 
agreement. As I see it, immigration is the type of matter that deserves 
close attention here in the Congress, with a full opportunity for 
debate. It is not something that should be rammed through without any 
meaningful opportunity for amendment or public input.

  I also am concerned about the inadequacy of the labor protections, 
included in thee agreements.
  Mr. President, I supported the Jordan Free Trade Agreement in part 
because it recognized the importance of protecting worker rights. That 
agreement ensured that both nations adhere to internationally 
recognized worker protection standards, and that worker rights could be 
enforced. It also ensured that labor standards were subject to the same 
procedural protections as the other provisions of the agreement. The 
Chilean and Singapore agreements fail to meet that standard.
  To the contrary, the labor protections in these agreements are not 
only much more narrowly defined--essentially dependent on the laws of 
the respective countries--but enforcement of those protections is much 
more limited, as well. For example, not all violations of labor laws 
could be enforced through the agreements--only those that are 
``sustained.'' Also, there are strict limits on the amount of fines and 
sanctions that are authorized in the case of labor violations, unlike 
violations of other provisions in the agreement. This disparity in the 
treatment of labor and commercial violations, in my view is wrong.

[[Page S10588]]

  Mr. President, I am concerned that the labor provisions in these 
agreements, and other similar provisions relating to environmental 
protection, will serve as a template for other trade agreements already 
under discussion. As I see it, the Administration would be making a 
serious mistake if it uses these provisions as a model for future 
agreements. I hope that will not happened.
  Mr. President, the types of commercial, labor and environmental 
issues addressed in these agreements are critical to the future of our 
nation, our economy, and millions of American workers. Yet, again, we 
are debating these agreements under expedited procedures that allow for 
every little debate and no amendments. In effect, while jobs continue 
to be sent abroad and millions struggle unsuccessfully to find work, 
the American people are being shut out of the process. In my view, that 
is not the right way to conduct the people's business.
  Mr. President, I recognize that these agreements have, in fact been 
approved. But I would urge my colleagues, before we continue along the 
same theme path as we develop other similar agreements, let us take a 
step back and rethink our nation's whole approach to trade, Something 
is seriously wrong when America is hemorrhaging dollors and 
hemorrhaging jobs. We need to change course. And continuing blindly 
with a failed approach would be a dereliction of our responsibility to 
protect America's economy and America's workers.
  I look forward to working with all of my colleagues to address these 
issues in the months and years ahead.

                          ____________________