[Congressional Record Volume 150, Number 132 (Wednesday, November 17, 2004)]
[Senate]
[Pages S11431-S11432]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BAUCUS (for himself and Mr. Craig):
  S. 2992. A bill to liquidate and distribute duties collected on 
certain softwood lumber from Canada; to the Committee on Finance.
  Mr. BAUCUS. Mr. President, I rise today in disappointment, but also 
with resolve.
  After more than 2 years of negotiations between the United States and 
Canada, there is still no agreement on how to manage softwood lumber 
trade between our two countries. This is disappointing, particularly 
given the importance of the issue. Perhaps what is most disappointing, 
though, is that the negotiations appear to have fallen off, despite the 
fact that parties last year seemed close to an agreement.
  There might be some who think that the recent NAFTA decisions signal 
an imminent conclusion of the litigation, and that deposits collected 
by U.S. Customs will be returned soon. As one who has seen this dispute 
wax and wane for nearly 30 years, this seems to me a naive expectation. 
The fact is that the recent NAFTA decisions had more to do with a 
bitter disagreement between the NAFTA panelists and the U.S. 
International Trade Commission about investigative methodologies than 
whether or not the Canadian timber policies are consistent with NAFTA 
obligations. The bottom line--and this is the issue at the root of this 
dispute--is that the Canadian policies are deeply inconsistent with the 
notion of a free and integrated North American market. The timber 
subsidies provide Canadian mills with a significant, artificial 
advantage. Until this basic issue is resolved, this dispute--including 
this litigation and the duties imposed on importers--will continue.
  In my judgment, the most effective, durable, and fair resolution to 
this decades-old problem will be found only through a negotiated 
settlement. This means both parties sitting down at the table and 
finding a mutually acceptable solution that provides for timber 
policies that are consistent and compatible. However, pulling away from 
the negotiating table and relying on litigation isn't going to get us 
there.
  Under current U.S. law, the deposits sitting in escrow are eligible 
for liquidation. As I have said, I would prefer a negotiated 
settlement--one that resolves all matters of disagreement, including 
the disposition of these deposits. but some involved in the negotiation 
appear to have decided upon litigation as their preferred method of 
resolution. If it is necessary for more and my colleagues to assert the 
legal rights available to the U.S. industry as a way of reminding the 
parties of the stakes that are still very much on the table, then that 
is what we will do.
  Today, my good friend, Larry Craig and I have introduced a bill that 
would order the Commerce Department to begin the process of liquidating 
the approximately $3 billion sitting in escrow, as a result of the 
antidumping and countervailing duties imposed upon imports of Canadian 
softwood lumber since March 2002. Further, these deposits are to be 
distributed to the U.S. lumber industry, which have been seriously 
injured by Canada's timber policies and which petitioned for these 
duties in the first place. This measure is consistent with current U.S. 
law and, if enacted, I expect the U.S. government to defend it to the 
hilt.
  I hope that our action today will spark a return--by both sides--to 
the negotiating table. However, if it does not, and if a settlement is 
not reached, I will not hesitate to push forcefully for enactment of 
this legislation.
  Mr. CRAIG. Mr. President, I rise today with a heavy heart because it 
has been more than four years since the expiration of the Canadian 
Softwood Lumber Agreement and we have very little to show for it except 
a U.S. industry that is still a victim of the situation.
  This is an issue that I have been involved with since I came to 
Congress and in that time we have seen three separate disputes 
resulting in two negotiated agreements that have also come and gone. We 
are now in the middle of our fourth dispute with no settlement 
agreement in sight.
  While the two countries were close to reaching an agreement last 
year, little has happened since to reach a resolution. Meanwhile, with 
each log truck that comes across the border from Canada, another light 
at a U.S. timber company goes out permanently.
  In order to ensure a future for U.S. timber companies, I am joining 
Senator Baucus, in introducing the Softwood Lumber Duties Liquidation 
Act.
  Under current U.S. law, the deposits sitting in escrow are eligible 
for liquidation. The duties were first imposed in May 2002, when the 
U.S. slapped antidumping and countervailing tariffs amounting to more 
than 27 percent on Canada imports. The Commerce Department had 
determined that Canadian timber policies amounted to an unfair subsidy 
and led to the dumping of artificially cheap softwood lumber into the 
U.S. market. Meanwhile, the U.S. International Trade Commission ruled 
that the subsidies and dumped imports injured the U.S. lumber industry, 
warranting the imposition of tariffs.

[[Page S11432]]

  That being said, it is time that all parties come together in honest 
faith and work towards establishing a settlement that is free and fair 
in its framework. Anything less would be unjust to producers and 
consumers on both sides of the border.
  I am hopeful for a resolution. However, in the meantime, I, along 
with Senator Baucus, will continue to uphold U.S. laws and the 
determinations of our trade agencies to help ensure fair trade and 
protect our industries from illegally subsidized products.
                                 ______