[Congressional Record Volume 151, Number 4 (Monday, January 24, 2005)]
[Senate]
[Pages S116-S126]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
NOMINATION OF CARLOS M. GUTIERREZ TO BE SECRETARY OF COMMERCE
The PRESIDING OFFICER. Under the previous order, the hour of 3
o'clock having arrived, the Senate will proceed to executive session
for consideration of Executive Calendar No. 1, which the clerk will
report.
The legislative clerk read the nomination of Carlos M. Gutierrez, of
Michigan, to be Secretary of Commerce.
The PRESIDING OFFICER. Under the previous order, there will be 2
hours of debate on the nomination, with 1 hour of debate under the
control of the Senator from Alaska, and 1 hour of debate under the
control of the Senator from North Dakota.
The Senator from Alaska.
Mr. STEVENS. Madam President, it is my intention to make a statement
presenting the nominee's qualifications and the consideration the
Commerce Committee gave to this nomination, to be followed by time that
I will yield to the Senator from Hawaii, Mr. Inouye. I hope that will
be acceptable to Senator Dorgan. His time would start following Senator
Inouye's time, who I understand is on the way to the Chamber.
This was the first nomination that came before the Commerce Committee
after I became chairman. President Bush nominated Mr. Carlos Gutierrez
to be Secretary of Commerce on November 29, 2004. Mr. Gutierrez is the
chairman and chief executive officer of the Kellogg Company, a major
food products company based in Battle Creek, MI. The incredible story
of how he got there, rising through the ranks, is a testament to the
American spirit.
Shortly after Fidel Castro assumed power in Cuba during the Communist
revolution, Carlos Gutierrez and his
[[Page S117]]
family fled their native country. They arrived almost penniless in
Florida and, after several years, eventually settled in Mexico City.
There at the age of 20, Carlos Gutierrez took a job selling cereal out
of the back of a van to small grocery stores.
With a lot of hard work, 10 years later, he was general manager of
Kellogg's Mexico division. Fifteen years after that, he was running the
whole company. It is a great American success story by any measure.
Mr. Gutierrez's nomination comes before the Senate at a time of
significant change in the American economy. The shock of September 11,
2001, a series of corporate scandals, and the spending pressure of the
war on terror, including the Iraq conflict, have taken their toll.
However, the President's economic stimulus program, centered around
tax relief, is helping our economy turn the corner. The economy has
created more than 2.4 million new jobs since August of 2003--15
straight months of job gains. The unemployment rate is at 5.4 percent,
down from 6.3 percent last June, and is below the average of the 1970s,
1980s, and 1990s. After-tax income has risen more than 10 percent since
the end of 2000, and household wealth is now at an all-time high. Even
the stock market has shown strong gains in recent months.
Secretaries of Commerce spend much of their time promoting American
business at home and abroad. If confirmed, Mr. Gutierrez will have an
impressive record of growth at his disposal.
There is much more to the Department of Commerce than representing
America's economic interests. Most of the Department's budget is
devoted to the National Oceanic and Atmospheric Administration. NOAA's
role in predicting tsunamis was not well known outside of the Pacific
coastal States before last month's devastating tsunami in Asia. The
administration recently announced a strong proposal to improve
detection and response to tsunami events along the U.S. coast. NOAA
will be the lead in this critical endeavor.
Mr. Gutierrez has probably already learned more about fisheries than
he ever expected. If confirmed, he will learn much more. The recent
report of the U.S. Commission on Ocean Policy reaffirms the important
role that domestic fisheries play in our society. Fisheries create jobs
in rural communities and provide valuable protein in the world's food
supply. The report of that commission highlighted the need to manage
all fisheries in a sustainable, regional manner. And that is exactly
what has taken place in the State that the occupant of the Chair and I
have the honor to represent. Our State, with half the coastline of the
United States, has led in developing new policies to protect and
preserve the reproductive capability of the fisheries off our shore.
I commend the President for his Executive order creating a Committee
on Ocean Policy within the White House. Those of us on the Commerce
Committee look forward to working with the President and Mr. Gutierrez
to ensure that our Nation's fisheries are managed sustainably,
responsibly, and regionally.
On January 5, Senator Inouye and I held a hearing in the Commerce
Committee on this nomination. Mr. Gutierrez answered a variety of
questions at the hearing and has since responded to many more written
questions. The next day, the committee voted unanimously to report this
nomination to the full Senate. I am here today to recommend the
Senate's quick confirmation of this nomination.
I thank Mr. Gutierrez for his willingness to serve our Nation and the
Department of Commerce, and I join in congratulating the President on
this fine nomination.
Mr. Gutierrez has my strong support, and I do urge the Senate to vote
to confirm this nomination as quickly as possible.
Madam President, 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. INOUYE. Madam President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. INOUYE. Madam President, I ask unanimous consent to speak for 4
minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. INOUYE. Madam President, I rise in support of the confirmation of
Mr. Carlos Gutierrez to serve as our Nation's Secretary of Commerce. As
Secretary of the Department of Commerce, Mr. Gutierrez will take over
the helm of a very diverse department, for example, responsible for
counting fish as well as people, predicting the weather, developing and
promoting standards, technology, and promoting fair trade. This is a
very difficult and complex appointment, but I believe Mr. Gutierrez's
impressive background and experience will serve him well in this
position.
He was born in Cuba. Mr. Gutierrez left Havana in 1960, shortly after
Fidel Castro took power. Although he has no college degree, through
hard work and perseverance, he rose from delivering corn flakes to
small stores in Mexico City to the moment when he took over Kellogg's
cereal and convenience food empire.
While at Kellogg, he revitalized the company and put it on a new path
of success. Mr. Gutierrez will face a variety of demanding challenges
during his tenure. But few are greater than addressing the
administration's current record on trade. Just this month, our trade
deficit hit an astounding and recordbreaking $60.3 billion, and I am
certain that all of us will agree that this is entirely unacceptable. I
would like to see the new Secretary lead the Department in an
innovative and comprehensive effort to reverse the current trend. I can
assure Mr. Gutierrez that this committee will be a committed partner in
such an effort.
I urge my colleagues to support the confirmation of Mr. Carlos
Gutierrez to serve as Secretary of Commerce.
I yield the floor.
Mr. STEVENS. Madam President, I yield such time to the Senator from
Montana as he may desire to use.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BURNS. I thank the chairman of the Commerce Committee. I rise in
strong support of Carlos Gutierrez as the next Secretary of Commerce. I
applaud the President for this choice for many reasons. Not only is he
a classic American success story, as we have heard from Senators Inouye
and Stevens, but he is an example for all the opportunities that are
afforded to Americans.
I am especially happy to see the President chose someone from a
manufacturing background. He also has a background on the ground, so to
speak. It is something to manufacture a product; it is also something
to sell the product because we live in an economic system where nothing
happens until a sale is made. Mr. Gutierrez understands both ends of
that equation.
For a long time, and since I have been here, this is the first
Secretary of Commerce who has an agribusiness background. Everything
the Kellogg Company does starts in the ground. I am especially happy
about that. I would hope we could work together. I have always said
there is nothing wrong on the farm except we just don't get as much of
the consumer dollar as we used to. We are going to work on that kind of
situation.
The Commerce Committee oversees some of the most important and
controversial issues that challenge this country and my State of
Montana. With his commitment--I have yet to meet the man, but we have
had an extended telephone call--to work with Congress on these issues,
his quick response to the questions I sent to him, and the things he is
going to be doing at Commerce, will put him in a position to assist
many sectors of our economy. I would like to take a few moments and
highlight some of them and where these issues will be discussed
prominently in the upcoming session.
Let's start with one that affects my State, the timber industry and
softwood lumber. Small mill operators in Montana rely on effective
enforcement of U.S. trade laws, particularly against unfair trade acts,
such as we have seen coming out of Canada. It is important that the
Commerce Department ensures full enforcement of the trade laws in the
softwood lumber sector, including selection of accurate subsidy
measurement benchmarks. The 911 implementation was critical
legislation. The enhanced 911 bill that
[[Page S118]]
passed the 108th Congress is now law. The law authorizes $1.25 billion
in grants to build out lifesaving emergency location capabilities
across the country. I can remember passing the 911 bill some years ago.
I said then it is probably the best step that we have taken in public
safety in a long time. These grants will be administered by a joint
program office run by the Department of Commerce and the Department of
Transportation. Basically, what it is, on your cell phone, you dial 911
to get emergency. Many years ago, that call did not know where to go.
It could have gone anywhere. Today, it goes to the nearest first
responder or communications center, no matter where you are in the
country. They can also locate you.
ICANN reform. I am concerned about the organization that manages the
Internet critical domain system. ICANN is falling victim to a little
bit of a mission creep, turning into a mini-international organization.
ICANN should retain its focus on technical coordination, which makes me
all the more concerned that the Department of Commerce plans to abandon
all oversight of ICANN next year. I urge the Secretary to review that
issue closely and get back to Congress.
Our Nation's spectrum policy remains outdated, and I look forward to
working with the Secretary in reforming that to keep pace with the
communications revolution. Broadband expensing; the Hollings
manufacturing extension partnership program; it is important that these
programs move forward, with a good deal of interest coming from his
Department.
Again, I want to reiterate my support for Mr. Gutierrez's nomination.
I look forward to working with him on many of the challenges that my
State and this country face under a vast umbrella called the Department
of Commerce. That is what makes our committee probably one of the most
exciting committees of any that operates in the Senate. I heartily
support his nomination. He should be confirmed.
Mr. President, again, I applaud the President for his choice. Mr.
Gutierrez certainly has a classic American success story and can be
looked at as an example of how great our country really is and the
opportunities it presents.
I am especially happy to see the President has chosen someone with a
manufacturing background. I believe Mr. Gutierrez's tenure at the
Kellogg Company will bring an important insight to the Department in an
area that certainly needs attention.
The Department of Commerce oversees some of the most important and
controversial issues that challenge my State of Montana. I appreciate
Mr. Gutierrez's commitment to working with Congress on these issues,
and his quick response to my questions following his hearing in the
Senate Commerce Committee.
Mr. Gutierrez will soon be in the position to assist many important
sectors of our economy. I would like to take a few moments to discuss
some of the challenges, priorities and issues faced in my State and
many others.
As you know, the U.S. timber industry jobs and operations, including
small mill operators in Montana, rely on effective enforcement of U.S.
trade laws, particularly against unfair Canadian lumber imports. In
evaluating the extent of Canadian timber subsidies, for example, it is
imperative that the Commerce Department ascertain the true market value
of Canadian timber in comparison to timber pricing data that reflects
full value. It is important the Department ensures full enforcement of
the trade laws in the softwood lumber sector, including selection of
accurate subsidy-measurement benchmarks. Mr. Gutierrez has indicated
his support of full enforcement of trade laws in the softwood lumber
sector and I applaud that support.
Mr. President, during my time as the Chairman of the Communications
Subcommittee, I made it a priority to move forward and implement the
deployment of universal broadband. Along with my colleague Senator Jay
Rockefeller we have pushed for legislation that would allow for
broadband expensing. As you may know, broadband expensing would allow
companies to accelerate depreciation of capital-intensive broadband
equipment. I am hopeful the Department will provide assistance in
passing this legislation as part of the President's vast broadband
vision.
I also would urge the Secretary to devote his personal attention to
an important issue regarding the future of the Internet. I am referring
to the security of the Domain Name System, which is what ensures that
each website address in the Internet resolves to a unique website
reliably and securely. It is vital for the future of e-commerce, and
those parts of the economy that increasingly depend on it, that this
process work flawlessly. During the Clinton administration, a private
non-profit company known as the Internet Corporation for Assigned Names
and Numbers, or ICANN, was established to oversee the real technical
challenges associated with managing the Domain Name System during a
time of explosive growth and political challenges.
However, I am concerned, and I know some of my colleagues are as
well, that ICANN may fall victim to ``mission creep'' in this case, the
tendency for it to turn into a mini-international organization, and all
the political baggage that comes with that. If so, ICANN's actions
could potentially go well beyond the narrow technical mandate that was
envisioned for it at its creation. ICANN currently is subject to an
agreement with the Commerce Department, and I am concerned that not
enough high-level attention in the Department gets paid to this issue
especially since, as I understand it, the Department of Commerce plans
to abandon any and all oversight role over ICANN some time next year. I
hope the Secretary will review this issue carefully and with all due
attention to the national interest and to the interests of Internet
stakeholders everywhere.
The U.S. Government has played a crucial and positive role in the
creation of the Internet and in Internet governance, and I do not think
that such a decision as this should be taken without thorough review
and understanding of its implications. I hope that Secretary Gutierrez
will take the initiative to understand this vital issue and consult
with Congress closely on it in the coming years.
Finally, I would like to voice my support for the Hollings
Manufacturing Extension Partnership which is administered at the
Department of Commerce. Montana is a rural State but we have needs and
opportunities that the Hollings Manufacturing Extension Partnership has
addressed. In recent years, I have grown concerned for the programs
advancement, but I am hopeful Mr. Gutierrez, with his manufacturing
background, will see the important role the program plays in small
States. It is important the Department ensures small manufacturers have
access to technical and information resources to allow them to remain
competitive.
Again, I would like to reiterate my support of Mr. Gutierrez'
nomination and I look forward to working with him on many of the
challenges my State and the country are faced with under the vast
umbrella of the Department of Commerce.
I yield the floor and thank the chairman of the Commerce Committee
for giving me this time.
Mr. STEVENS. Mr. President, we have no further speakers on this side.
I reserve the remainder of our time.
The PRESIDING OFFICER (Mr. Vitter). The Senator from North Dakota is
recognized.
Mr. DORGAN. Mr. President, it is my intention to support the
nomination of Mr. Gutierrez to be the Secretary of Commerce, an
important position in this administration and for our country's
economic well-being. However, before I do, I want to call the attention
of the Senate to some important issues.
I come to the floor to speak at some length about a very serious
problem: the burgeoning U.S. trade deficit. This is a deficit that
fundamentally weakens this country, a trade deficit that last month
alone was $60 billion, a trade deficit that will be something over $600
billion for the year 2004, when we finally get the year-end numbers.
Despite this growing crisis in international trade, the Congress, the
President, and virtually all of the official Government, seems to be
willing to snore through all of this and pretend it does not exist.
I think it is fitting that we discuss this at some length at a time
when we are putting a new Commerce Secretary in place.
[[Page S119]]
Before I do that, let me talk for a moment about Social Security. In
recent days there has been a great deal of discussion on that issue.
The President indicated that this would be one of the first items we
will be confronted with. He proposes to create private accounts in the
Social Security system, because he says there is a crisis in Social
Security. Well, there is not a crisis in Social Security. Let me make
it clear. There is no crisis in Social Security. If we have the same
economic growth rates in the next 75 years that we had in the past 75
years, Social Security will be just fine.
The only way there is a crisis in Social Security--or you can at
least create the impression that there is a crisis--is if you attempt
to project growth rates that are dramatically lower than that which we
have experienced. If you are going to project lower economic growth
rates--1.8 percent, for example--over the coming years, then you cannot
predict that somehow investing money in the stock market through
private accounts is going to solve any kind of problem.
It is interesting to me that the ethic and value system in America
has been that if you are going to provide for your future, you save for
retirement. The President is suggesting that we should borrow $1
trillion to $3 trillion and dump it in the stock market and hope things
will be all right. Even as we do that, the amendment leaked from the
White House says we will cut Social Security benefits by changing the
adjustment on wages and prices. The construct is this: Claim there is a
crisis where there is not, and borrow $1 trillion to $3 trillion and
put it into the stock market at the same time you cut Social Security
benefits.
In my judgment, that is a bad policy, one we ought to resist. It is
important for people to understand the Social Security system is not an
investment program; it has never been that. It was created in the 1930s
and signed into law by Franklin Delano Roosevelt to help the elderly
escape the plague of a poverty-ridden old age. When he signed that
bill, 50 percent of America's senior citizens were living in poverty.
Now it is less than 10 percent. But it is not now and has never been an
investment program. It is a core insurance retirement program. It is
the foundation of retirement security. It is always there, not subject
to risk. It is core retirement insurance. In fact, if you look at your
paycheck, it says the money that comes out of your paycheck for this
program is FICA. The ``i'' in the FICA is for insurance.
The President wants to confuse us by talking about investments. We
have a Social Security program that is a core retirement insurance
program. It has worked well for over 70 years. It lifted the hopes and
lives of so many tens of millions of senior citizens out of poverty.
We have also, under the rubric of retirement incentives, created
401(k) programs and IRA programs and pension incentives, all of which
represent investment accounts. I support those. But that is different
than the core insurance program called Social Security. In my judgment,
we ought to aspire in this Congress to be working toward Social
Security-plus, not Social Security-minus. Those who say the way to
build retirement security is to injure the foundation, or begin to take
away the foundation that is Social Security insurance, do no favor to
senior citizens. The way for us to enhance and embrace and strengthen
retirement security is to build on the first, second, and third floors,
not destroy the foundation.
Once again, there is no crisis in Social Security. Let me be the
first to say that we are living longer, healthier lives, and so the
problems that might occur 20, 40, 60 years from now in Social Security
are born of success. We are living longer, healthier lives. And if you
are a pessimist and believe we will have only 1.8 percent economic
growth rates, which is what the basis is for suggesting there is a huge
problem in Social Security--if you are a pessimist, then you can
suggest there need to be adjustments in Social Security. But that
cannot be a pretext for taking apart the Social Security system. That
is what some wish to do. They never liked it, don't like it now, and
want to take it apart. How? They want to create private investment
accounts inside the Social Security system, which is a big wet kiss to
Wall Street to move money that is borrowed to Wall Street and hope that
somehow the social program will be solvent.
We have already had substantial experience in the last several years
with economic projections by the people telling us this will work. They
inherited the largest budget surplus in the history of this country and
we now have the largest budget deficit in history. They didn't see it
coming. They said, by the way, let's count these 10 years of surplus
before they exist and give them back in tax cuts. Some of us said maybe
we ought to be more conservative. These surpluses don't yet exist. The
President said never mind, Katy bar the door, give all these moneys
back even though they have not been realized; give them back in tax
cuts.
The fact is we turned the largest budget surplus into the largest
budget deficit in history. The same people who predicted success for
economic failure are the people telling us we ought to take apart the
Social Security program under the guise of there being a crisis.
Let me make one additional point that I think is very important.
Those who tell us that we will have only 1.8 percent economic growth
for the next 75 years, and therefore we have a financing problem with
Social Security, also say that private accounts in Social Security
invested in the stock market will yield 7 percent. Therefore, it will
fix the problem. Double-entry bookkeeping doesn't mean you can pretend.
You cannot say on the one hand we are going to have slow economic
growth, and therefore a crisis in Social Security, and on the other
hand, during periods of slow economic growth we will have 7 percent
annual return on private accounts. It doesn't work that way. Third-
grade math will tell you that is fundamentally wrong.
My hope is we will have a thoughtful, interesting debate about
retirement security and about Social Security. I hope at the end of
that debate, we will all agree that we should do nothing to undermine
Social Security. If we believe that there is nothing more important
than our children and taking care of them, and nothing more important
than taking care of our parents when they are elderly, we ought to
protect the social safety net that promotes those values.
Social Security has lifted so many in this country out of poverty. It
has worked for 70 years and it will work for the next 70 years and well
beyond. I for one am not interested in taking apart that which works
and which makes this a better place to live. After all, those who gave
us what we now have in this country, who went before us and helped
build this country, built our communities, factories, and our schools,
and helped increase the standard of living, expanded opportunities for
our country--those are the people from whom we have inherited this
great life.
If we have decided somehow that we don't have the wherewithal to
continue to make this Social Security system work for them, to keep it
a promise they can count on, then there is something wrong with the
value system of this Congress. I don't believe that to be the case. I
think at the end of the day we will all agree Social Security is a
value that is important, one we will strengthen and keep.
Enhancing retirement security is important as well and, at the end of
the day, we ought to have what is called Social Security-plus. We can
do Social Security, keep it strong in the long term, and build further
incentives for IRAs, 401(k)s, and pension programs. That ought to be
our mission statement.
Let me turn back now to the issue of international trade. We have
before us the nominee for the U.S. Department of Commerce. That is one
of the agencies in our country that deals with trade issues.
Mr. Gutierrez, President Bush's selection to head the Department, is
someone whom I will support today. But I don't want this moment to pass
without all of us having to confront something that is very
uncomfortable for this country, and that is we have a trade policy that
is weakening America and that is in fact a ``crisis.'' I described
where the crisis doesn't exist, in Social Security; but there is a bona
fide crisis in international trade.
Last month, we heard a report that we had a $60 billion trade
deficit--just
[[Page S120]]
last month alone, $60 billion. We are told that we should expect, when
all of last year's numbers are in, that our trade deficit will top $600
billion. Add to that the budget deficit of over $400 billion, and we
have a combined indebtedness of over $1 trillion in this past year
alone--$1 trillion. Talk about being irresponsible with our kids'
future. This is it. Yet, do you hear anybody talking about the urgency
of this? Not a word. Not a whisper. It is like shouting into a strong
wind to talk about trade.
Well, let's talk about some of the issues related to this soaring
trade deficit. I am going to go through a series of examples.
The January 10 edition of Time Magazine had an interesting article in
it. It says:
Chinese pirate companies have long been accused of
illegally copying easy stuff like shoe polish and digital
movies. Now General Motors says a Chinese firm knocked off an
entire vehicle--and Americans could soon start buying its
cars.
So let's talk about that a bit. It is reported that a Chinese firm,
called Chery, has stolen production line blueprints for a GM compact
car called the Chevrolet Spark. It is a car that General Motors spent
hundreds of billions of dollars to develop and the copy car is called
QQ. It looks like an identical twin to the Spark. The Chinese company
is now offering it for sale in China for $3,600, a third less than the
General Motors car.
Chery, the automobile company in China, has now announced plans to
sell five different models, including a sport utility vehicle, in the
U.S. It teamed up, apparently, with Malcolm Bricklin, who brought the
Subaru to America in the 1960s. Their plan is to import up to a quarter
of a million Cherys a year starting in 2007. The Chinese want to send
us a quarter million Chinese cars in a year.
Well, what to make of that? Let me describe a trade agreement that
our country made with China a while back. We had a bilateral trade
agreement with China. This is a country that had a large surplus with
us. Our negotiators negotiated a deal with China. Inexplicably, they
agreed to this. They negotiated a deal where the Chinese can impose a
25 percent tariff on any United States cars we ship to China.
But on any Chinese cars sent to the United States, we impose only a
2.5-percent tariff. So our negotiators said to a country with which we
have a giant trade deficit: We will agree with you that you can impose
a tariff on bilateral automobile trade that is 10 times higher than
that we will agree to impose: 2.5 percent on Chinese cars coming into
our country, 25 percent on U.S. cars that we try to sell in China.
You ask yourself: Who on Earth would have done that? I don't have the
foggiest idea. Our trade negotiators did it. They apparently wear blue
suits, they have tiny little glasses, they are supposed to think,
probably have advanced degrees. And yet they close a door somewhere in
a private room, someplace in secret, and reach a deal that says to the
Chinese: on bilateral automobile trade, you go ahead and impose a
tariff 10 times the tariff we will impose on automobiles between China
and the United States.
Guess what. We sell very few cars in China. We cannot get them in,
and the Chinese, having apparently stolen the designs on a new compact
car from General Motors, are set to send us a quarter of a million
cars.
Should we perhaps find out who negotiates this sort of incompetence
so we make sure they never again negotiate on behalf of our country
because this is not some theory?
This is about jobs. When you do this, it means you are reducing
America's job base and enhancing the job base in other countries.
On a related note, in a recent year, we saw 690,000 Korean
automobiles come to the United States to be sold in the United States.
Guess how many American cars we sold in Korea? We sold 3,800. So Korea
sent us 690,000, and we sold them 3,800.
There was a time during this period when Korean consumers seemed to
want to buy a pickup truck called the Dodge Dakota. Several dozen
orders for Dodge Dakota trucks were coming into Dodge dealers in Korea.
Guess what. The Korean government decided to announce that the Dodge
Dakota wasn't safe, because it was capable of having a topper installed
in the back, and that wasn't customary in Korea. So they did a big
splashy announcement, and before you knew it, all the orders were
cancelled. Korean consumers got the message.
So in Korea they want to sell their cars in the American marketplace,
but they do not want our cars sold in Korea. Will we say to the Koreans
or the Chinese, for that matter, that either your market is open to our
products, or you are going to have to see your products in Zambia or
Nigeria? I don't think so because our country does not have the nerve,
strength, will, or backbone to stand up for America's economic
interests, for American workers, American businesses, and American
jobs.
I want just one Member of Congress, in the House or Senate, to
justify this to me--just one. Or to justify the circumstances of mutual
automobile trade with China by which we agreed with China that we will
allow them to impose a tariff that is 10 times ours on bilateral
automobile trade. Just one person I would like to stand up and say:
Yes, that makes sense. We know it doesn't make sense. We know it
undercuts American workers. It moves American jobs overseas, and yet no
one seems to care very much about it.
Here is another item in the news. There is a new report that talks
about the export of jobs from this country to India. AMR Research
estimates that the Indian information technology labor force will be
larger than 3 million by 2010, and half the workers will be performing
jobs for U.S. companies.
Let's talk for a moment about that: these information technology jobs
that are being outsourced to India are good jobs. But there are some
who think that this outsourcing is a good thing. In fact, the
President's economic report to Congress said that, for example, having
Indian radiologists reading x rays of U.S. patients would be a good
thing.
What will happen to the 1.5 million Americans who will lose their
jobs in information technology services to the country of India?
Well, one thing they will not be doing is producing merchandise for
export to India. In 2003, we had a trade deficit with India. That same
year the average duty, the average tariff on goods that we were to sell
to India was 30 percent. According to the U.S. trade ambassador's
office, India's economy is one of the most closed in the world and,
thus, India's tariffs remain among the highest in the world.
Now the trade ambassador's office says the Indian economy has the
most potential for U.S. exports. I expect that is true, because India
has 1 billion people. One out of six consumers on the planet lives in
India. It is the second most populous nation in the world. Yet where
does it list on the U.S. export markets? Second, 5th, 10th, 15th, 20th?
No, 24th.
In fact, we export nearly twice as much to Peru as we export to
India. And yet we see all of these reports now about American jobs
being sent to India. Apparently, the only thing we can send to India
are jobs, not goods. India has a 105-percent tariff on cars and
motorcycles--in fact, we cannot get motorcycles into India--40 percent
on oranges, over 100 percent on raisins, 30 percent on soybeans, 100
percent on durum wheat.
You know, you can't have balanced trade these days, even if you want
it.
A family in Illinois this year decided to do something different for
Christmas. They decided they were going to ban China from under their
Christmas tree. The mother decided that she was going to buy U.S.-made
Christmas gifts. Peggy and Dave Smedley were going to buy American for
Christmas.
Of course, that meant no iPods, no digital cameras, no tabletop
football games. And in the end, it was nearly impossible for them to
find the Christmas gifts they wanted for their children. They found a
Monopoly board game that appeared to be made in the U.S. but they
discovered the dice actually came from China. Their son wanted
American-made boots, and Peggy Smedley looked in 30 stores for boots
that were made in America before giving up. The Smedley kids were
concerned they might not get any presents at all for Christmas because
of their mom and dad deciding they wanted to buy American.
The 13-year-old Smedley son said he did not know what to expect
because ``I
[[Page S121]]
have never bought American before,'' which I suppose is an innocent
comment from a 13-year-old kid about the world in which we live.
Levis used to be all American. They are gone. In fact, I am told that
the Levis Company does not make any Levis anymore. The Levis Company
makes no Levis. All the Levis are made under contract by contractors.
The Christian Science Monitor reported the other day something else
that I thought was kind of interesting. One would have thought when
they walked around with a pair of cowboy boots that they were walking
in an all-American pair of shoes, but last month I noticed in the
Christian Science Monitor even the cowboy boots now sport ``made in
China.'' Tony Lamas, top of the line cowboy boots, inside the label it
may read ``made in China.'' Thirty-five to 40 percent of these cowboy
boots have now been outsourced.
I have spoken often of Fig Newton cookies. It used to be that Fig
Newton was the all-American cookie. Well, next time somebody says, let
us have some Mexican food, just say, give me a Fig Newton, from
Monterey, Mexico. By the way, Kraft Foods moved the production of Fig
Newton cookies to Monterey, Mexico. So eat a Fig Newton and you are
eating Mexican food.
Fruit of the Loom used to be all-American underwear but not any
longer. They are gone. Levis are gone. Huffy Bicycles are gone. Schwinn
Bicycles are gone. Little Red Wagon Radio Flier is gone. They were all
American, all made by Americans, all represented jobs for American
families, and they are all gone.
Why is all of this happening? Well, what has happened is
multinational corporations have discovered there are somewhere around a
billion people available on this globe who work for a very small amount
of money. There is someone in Indonesia today who is making a pair of
shoes. There is 24 cents direct labor in that pair of shoes that will
be sold in Pittsburgh, Fargo, or Los Angeles for $80 a pair, and that
woman named Shadisha is going to be paid 24 to 30 cents an hour.
There is someone in China today who is making Huffy bicycles. That
man or woman took the job of someone in Ohio who was making $11 an
hour, plus benefits. They got fired. They lost their jobs because the
Huffy bicycles were moved to China and now workers in China are paid 33
cents an hour. They work 7 days a week, 12 to 14 hours a day making
Huffy bicycles.
The Little Red Wagon Radio Flier Wagon that has been made in American
for over a century is gone. It is because corporations have discovered
there are a billion people who will work for very little money. In some
cases, they employ 12-year-olds. They work 12 hours a day. They pay
them 12 cents an hour. If my colleagues do not believe it, I can show
them.
The question is, What does all that mean to our country? What does it
mean to the world's strongest economy? What does it mean when one
hollows out the manufacturing base of a country such as the United
States? What does it mean when we say to American workers that there is
a new day and a new competition, when we say to the American workers,
yes, for a century they fought for rights, some lost their lives in the
streets of this country fighting for the right to organize; they fought
for the right to work in a safe workplace; the American people fought
for the right to understand that corporations and factories would not
pump effluents and poisons into the air and water; we fought for child
labor laws so 12-year-olds would not be sent down into the mines or
into the factories? What does it mean when we are told it is a new day
and none of those things matter because those who produce can produce
elsewhere where no restrictions like that apply?
A kid can be hired and he can be worked 7 days a week and paid
pennies. And it is said to the American worker, you must compete with
that, and if you cannot compete, we are going to outsource, and if you
do not like outsourcing, tough luck.
I am just wondering how all of this adds up. This country has been a
wonderful country because going all the way back to when Henry Ford
made the Model T he understood that production needs customers. Even as
he produced, he was hiring workers and saying: I want to give workers a
decent income with which they can purchase that which we are producing.
He understood he was employing his own customers.
Now we have a different set of circumstances in our country. Now we
have products made by child labor, in countries that pollute their
environment, and we are asked to compete with that. After 9/11, when
there was a surge of demand for American flags, do you know where they
came from? From overseas. The import of American flags jumped to 113
million American flags in a year. And I bet you that many of those
flags were made in conditions that would gravely offend the principles
that the flag represents.
I will put up a chart that shows the growth of the trade deficits
over recent years, because it describes what this is all about. Year
after year, we see these trade deficits growing and growing. It is as
if it does not matter. Nobody here cares. Nobody here has lost their
job because of these numbers. There is not one politician in America
who has lost their job to outsourcing. There is not one journalist who
has lost their job to outsourcing of which I am aware. So it is as if
it does not exist. It is just the other people who lose their jobs. It
is people who take a shower after work because they sweat all day at
work working long and hard on the factory floor and they are told
somehow they cannot make it.
I have talked about Huffy bicycles. I received a letter from the
Huffy folks that they were upset about the fact. They were a little
huffy, as the saying would go, about my discussion.
In Ohio, workers used to make Huffy bicycles. In fact, Huffy bicycles
had a little decal of the American flag.
I do not know any of those folks but my guess is that they loved
their jobs. They made a great bicycle. They had 20 percent of the
bicycle market in America. People could buy them at Sears, Wal-Mart,
Kmart. I am sure that one day when they had to go home and tell their
spouse, honey, I have lost my job, that it was a painful day. They had
to tell their spouse and their families: I lost this job not because I
was a bad worker--I worked for 20 years for this company; I did a good
job; I produced a good product--but I lost my job because my company
discovered they could hire somebody for 33 cents an hour to build that
bicycle.
Incidentally, that bicycle took the American flag off the front decal
and replaced it with a decal of the globe once they moved production to
China.
What does all of that mean? What does it mean for our country? We are
running giant trade deficits with virtually everyone in the world:
China, huge trade deficits. This map shows the world, and it shows in
red the countries with which we run trade deficits. It is unbelievable.
Here is the United States. Of course we can't run a deficit with
ourselves. We are running a surplus with Australia down here. We will
probably fix that soon, as soon as the new trade agreement with
Australia kicks in, because in almost every case, every trade agreement
we have done turned out badly for this country because we don't have
the backbone to stand up for the interests of our producers.
Australia, Egypt, Belarus--hey, look, we have a bright spot over here
in Belarus--these are among the very few countries with whom we have a
deficit. With almost the entire world we are running very large trade
deficits; virtually the entire world.
How long will that last? Mexico is a good example. We had a trade
surplus with Mexico--a small one, but a trade surplus. Then we did what
was called the North American Free Trade Agreement, and this chart
shows what happened. Right here is the trade surplus. Then we did a
North American Free Trade Agreement. We had a bunch of these
economists, who cannot tell their home address and can't remember their
phone numbers, give us all kind of highfalutin' predictions about what
is going to happen. They said this is going to be good for America; the
only thing that will come into this country from Mexico with this trade
agreement is the product of low-skilled, low-wage jobs. Guess what. The
three largest imports into America are automobiles, automobile parts,
and electronics, all the product of high-skilled jobs, exactly the
opposite of what these so-called economic experts told us.
In the meantime, what happened with our trade with Mexico? We have a
[[Page S122]]
giant trade deficit, serious and growing.
Canada is another example. With respect to Canada, which was part of
NAFTA as well, the trade deficit was a modest trade deficit when we
started. Now it has grown into a very substantial trade deficit.
The trade deficit with China is a dramatic trade deficit and it is
growing much worse. I just described part of the problem with China.
You can see what is happening here to this country.
You can make a case, if you are an economist, that the budget deficit
is money we owe to ourselves. You can make that case. You can't make
that case with the trade deficit. The trade deficit is a deficit we owe
to others in other parts of the world and will be paid inevitably with
a lower standing of living in this country. It will. You cannot make
any other case. That is why I come to the floor to say this is very
serious and very troublesome.
I have not mentioned the Japanese. The Japanese are also a good
example because every year, for well over a decade, we have had a large
and abiding trade deficit with Japan. Japan, as you know, has managed
trade. The result of managed trade with Japan is that the Japanese
continue to keep certain of our products out, yet they want to ship all
of their products to the United States.
I recall we did a beef agreement with Japan. About 15 years ago this
country did a beef agreement with Japan. At the end of the beef
agreement you would have thought we won the Olympics. Our trade
negotiators were ecstatic, big celebration, jubilation, front page of
the Washington Post, good for us. Guess what. Fifteen years after a
beef agreement with Japan, a country with which we have a very large
trade deficit--we still have a 50-percent tariff on beef going into
Japan.
That would by any definition be a failure, but not with our country,
because we have such low expectations of ourselves and such low
expectations of our trade negotiators being willing to stand up for the
economic interests of this country.
The list is almost endless. Wheat to China. I have spoken at great
length about wheat to China, the promises of the Chinese to allow 8.5
million metric tons of wheat into China and, once again, promises that
were not kept.
The list is virtually endless.
We have all these trade negotiators who go out and negotiate
agreements. As I said, they wear blue suits and small glasses. My
preference would be to put a uniform on them that says ``USA'' on the
front, because I think they forget for whom they work half the time.
But nonetheless they negotiate these agreements.
Even though in my judgment these agreements have been incompetently
negotiated, they are supposed to enforce the agreements. But let me
tell you what is happening in the Department.
We had roughly a $130 billion deficit with China previously. It is
probably $160 to $170 billion just in the last year. Yet we have only
19 people in the Department whose job it is to enforce trade agreements
with China.
We have a $66 billion trade deficit with Japan. There are only 10
people in the Commerce Department working on opening up trade markets
in Japan.
We have a $13 billion trade deficit with Korea. There are 2\3/4\
people--I don't know who the three-quarters of a person is--working to
open up the Korean market.
Our deficit with the European Union is $77 billion. There are only 15
people working to open up the European markets. It is unbelievable.
As I have said, we fought for a century about the basic conditions of
production and the basic rights of workers. We now accept into this
country the products of working people who are told they will be fired
if they try to start a labor union--just fired.
We accept products into this country that are produced by kids. We
had a hearing in the Congress some while ago that was heartbreaking. It
described children who, in a country far away from here, were making
carpets and rugs. They were locked in buildings making these carpets
and rugs. It described the conditions in which the employer took
gunpowder and put it on the fingertips of these children and lit the
gunpowder to produce scarring, so these young children, using needles
to sew these carpets, when they stuck their fingers would not be
injured. The scarring would allow these children to be more productive.
Is there an admission price to the American marketplace? Have we
decided the 1 billion-plus people around the world under virtually any
conditions of production are acceptable for multinational corporations
to seek out and to employ to produce products that will be shipped into
our marketplace? Is that what we want? Do we believe that is in the
long-term economic interests of this country? Do we understand that it
will injure this country's long-term economy? It will mean that we will
hollow out not only the manufacturing sector but also the middle class
in this country, because the jobs they used to expect, the
manufacturing jobs that would pay well, with benefits, are not there.
They have been outsourced for a quarter an hour or 50 cents an hour.
Those who talk about these issues are often called protectionists;
xenophobic isolationist stooges who just don't get it.
The fact is, I am interested in protecting the economic interests of
this country. No, I am not interested in protecting Americans from fair
competition. I think competition represents something that is important
to our producers as well because it makes them better producers. But
fair competition is critical. I don't believe producers or workers in
this country can or should be linked to competition with those in other
parts of the world who can produce in circumstances where they pollute
the air and water, hire children, pay pennies, and work in unsafe
plants. That is why on trade agreements we have fought on the floor of
the Senate to add provisions dealing with environment and labor, and we
have been rebuffed at every circumstance and at every turn. We are
seeing the results of that now--day after day after day.
I want to talk just for a moment about something else that Mr.
Gutierrez will inherit at the Commerce Department. I know it is not
quite the important issue that China, the European Union, Mexico,
Canada, and Korea are with respect to trade, but I want to talk for a
moment about Cuba.
Cuba is 90 miles off our shores. It is a Communist country. The fact
is, we do business with Communist countries. We sell and buy from
China, a Communist country. We do the same with Vietnam. We do that
because our country's official policy is engagement through trade and
travel. That is the way to move these countries in the right direction.
We believe that very strongly. Republicans and Democrats claim that to
be the case.
It seems to be different, however, with Cuba. Although we do business
with Communist China and Communist Vietnam, Cuba seems somehow to be
different.
Then Senator John Ashcroft and I offered an amendment on the floor of
the Senate which became law. It became law after 40 years of an embargo
in which we couldn't sell a thing to Cuba. Senator Ashcroft and I said
it is immoral to use food and medicine as a weapon; that we ought to be
able to sell food into the Cuban marketplace. So we got it passed. The
provision was that the Cubans had to buy food with cash. But,
nonetheless, we got it passed.
The Cubans have purchased nearly $1 billion worth of agricultural
products from American farmers. But some in this administration have
never liked that, and they are doing everything they can to derail and
try to stop the sale of agricultural products into Cuba. We have had
farm fairs and agricultural fairs in Cuba. The Farm Bureau, the Farmers
Union, and American farmers and ranchers have gone to Cuba. Cuba has
bought nearly $1 billion worth of agricultural products from this
country.
Let me tell you what has happened. At an organization called OFAC,
the Office of Foreign Assets Control, they have been doing everything
conceivable to stop people from traveling to Cuba--yes, even to travel
to sell agricultural products--and to stop the sale of agricultural
products into Cuba.
I want to give an example of the absurdity of this. This is a young
woman, Joni Scott, who is looking at a Bible. She is a wonderful young
woman, a Christian woman, who went to Cuba to
[[Page S123]]
distribute free Bibles. Guess what happened to this young American
woman who went to Cuba to distribute free Bibles? Our Treasury
Department tracked her down and tried to slap her with a $10,000 fine.
What was her transgression? Trying to distribute free Bibles in Cuba.
Or, I could show you a picture of Joan Sloat who joined a Canadian
bicycle tour. What was her transgression? This 76-year-old grandmother
rode a bicycle for 10 days in Cuba. They wanted to attach her Social
Security through our own Treasury Department. The Office of Foreign
Assets Control tracked her down and levied a big fine. What they are
doing is unbelievable.
The Office of Foreign Assets Control in Treasury is supposed to be
tracking the funding for terrorists. But let me describe the way they
are using their assets. Twenty-one people down at the Office of Foreign
Assets Control are tracking American citizens who are suspected of
taking a vacation in Cuba. They are under suspicion of taking a
vacation in Cuba--21 people. They have four people tracking Osama bin
Laden's financial network. It is unbelievably dumb--the allocation of
resources in this manner.
Why do I raise this? Because in the last 2 months or so the
administration has decided they want to shut down the agricultural
sales that do exist and can exist legally by reinterpreting when
payment must be made and trying to create a circumstance that will wave
off those who want to sell into Cuba.
Mr. Gutierrez and I had a discussion about that when he came to see
me. He is probably going to have to follow the administration line. It
is that our farmers ought to be penalized and ought to be prevented
from selling into the Cuban marketplace. The European farmers can sell
there. The Canadian farmers can sell there. We have a natural advantage
to sell into that marketplace because it is closest to us. But this
administration wants American farmers and ranchers to pay the cost of
their foreign policy.
One day about 2 years ago, as a result of the legislation which I got
passed, 22 train car loads of dried peas left North Dakota, the first
shipment in 42 years into the Cuban marketplace. I am proud of that.
I think the administration ought to be ashamed at what they are
doing. They are saying that trade and travel is the road to
enlightenment and the road to democratic reform in China and in
Vietnam, but it is not in Cuba.
It has nothing to do with common sense. It has to do with politics.
The administration knows it, and they are doing everything they can to
have American farmers and ranchers--for that matter, people such as
Joni Scott or Joan Sloat--paying the price of that burden. It makes no
sense at all.
My hope is that as we proceed, some small modicum of commonsense
might infiltrate the basic trade policies that are debated both in this
Congress and also in the administration.
It is not the case, for instance, that outsourcing of American jobs
strengthens this country. The President's chief economic adviser said
outsourcing is good. I guess it's good as long as he doesn't lose his
job. The fact is, neither he nor people like him ever lose their jobs
in these kinds of constructs. They never lose their jobs.
This is about working families, the kind of people who helped build
this country of ours, the kind of people who value work. They are the
ones who lose their jobs. They are the victims of unfair trade.
My hope is just once--perhaps just once--there would be some kind of
fire alarm with a $60 billion-a-month trade deficit. But I hear
nothing. There is this vast silence. I hear nothing about that being a
crisis. All we hear is Social Security is in crisis, which, of course,
is not the case.
My hope is that perhaps we can find a way in the coming months, we
can wake up to the fact that there is a crisis in trade, and perhaps
have the President call an emergency meeting of policymakers and decide
what we do about this. But there is this vast silence about it. Nobody
wants to talk about it. Again, I suspect it is because nobody here is
losing their jobs. But this country will not long remain a world
economic power if it doesn't put its fundamentals in order.
There is a wonderful book called ``The Lexis and the Olive Tree''
written by Tom Friedman. In it, he makes the point that just because
there is a run on a bank, it is not about whether the bank is solvent
or has a problem, it is about whether people perceive it to be solvent.
He makes the point that market traders always perceive strengths and
weakness. And when they move against your country and against your
currency, beware.
This country cannot long exist with a $1 trillion annual shortfall.
In both budget deficits and trade deficits, the fundamentals are out of
line--completely out of order--and everyone here should know it. Yet we
are waltzing around here acting as if nothing is happening. That
doesn't serve this country's interest. We know better. The American
people know better. Our trade policies are in serious trouble and
deserve our full attention.
On behalf of American workers, on behalf of American businesses, and
on behalf of the future of this great country, we owe it to our kids,
we owe it to our future to address this important issue.
Ms. CANTWELL. Mr. President, I wanted to let my colleagues know
briefly of the reasons why I support the nomination of Carlos M.
Gutierrez to be Secretary of Commerce. The Senate will vote on this
nomination later today. I had the opportunity to sit down and speak
with Mr. Gutierrez at length. While he has limited experience with
matters handled and regulated by the Commerce Department that are
important to Washington, such as fisheries, aerospace, and
telecommunication, I was impressed by his general business acumen and
management skills. I also found him willing to be personally engaged
and to engage others on issues outside of his area of expertise. I
appreciate his willingness to serve, and I look forward to working with
him in the future.
Mrs. FEINSTEIN. Mr. President, I want to share my views on the
nomination of Carlos Gutierrez to become United States Secretary of
Commerce.
Mr. Gutierrez's rise in the ranks at Kellogg Company--from selling
cereal out of a truck in Mexico City 30 years ago, to serving as the
company's CEO--is truly a remarkable achievement. Such business
expertise will be pivotal for Mr. Gutierrez as Secretary of Commerce.
In part, for this reason, I am confident that Mr. Gutierrez is a
qualified candidate for this office.
Nonetheless, I believe that it is important to take note of the
breadth of agencies and issues that the Secretary of Commerce oversees.
Advancing technology, trade, and business development are just a few
of the important responsibilities that the Secretary of Commerce must
assume. Particularly, in my home State of California, the Secretary has
enormous influence.
The Secretary is responsible for the National Oceanic and Atmospheric
Administration, NOAA, which is critical to our ability to make use of
oceanic and atmospheric research. For instance, NOAA operates the
National Tsunami Mitigation Program, which NOAA created in 1997 and
maintains in the Pacific Ocean today.
The Secretary of Commerce also oversees the International Trade
Administration--ITA. In agriculture, manufacturing and numerous other
sectors, trade plays a vital role in the daily lives of Californians.
According to the ITA's latest data, 55,421 companies exported goods
from California in 2002. Of these companies, the overwhelming majority
were small or mid-sized enterprises with fewer than 500 employees.
I believe that strengthening our relationships with trading partners
is fundamental to the continued growth of California businesses. With
the Secretary's leadership, fair and balanced trade policies will help
California's markets increase our export capacity even further.
I applaud the nominee's openness in his previous statements on the
need for reforming specific trade policies that need improving. I hope
that Mr. Gutierrez will be a force for leveling the playing field for
trade in the future.
Although his role representing Kellogg Company was decidedly narrower
than that of Commerce Secretary, I expect that Mr. Gutierrez will weigh
every position and consequence when considering trade policy. The
people of California and the United States depend on it.
[[Page S124]]
Much of the Commerce Secretary's time must be spent encouraging
business development. Too many jobs go overseas and I believe that a
robust policy to vigorously promote job growth should be a top priority
for the Secretary.
Since 2001, over 2.7 million manufacturing jobs have been lost. We
have also sustained net job losses in the private sector since 2001 and
household median income continues to lag. We can and must do better.
Through agencies like the Economic Development Agency--EDA, the
Commerce Secretary can be a real catalyst for economic growth. By
funding public works projects and innovative enterprises the EDA brings
opportunity to the communities that need it most.
I hope that as Commerce Secretary, Mr. Gutierrez will aggressively
protect American jobs and encourage job creation, making full use of
resources like the EDA.
The responsibilities of the Secretary of Commerce are complex and
far-reaching, and this will certainly be a challenging position for Mr.
Gutierrez.
There is a great deal of work to be done, and I look forward to a
productive working relationship with Mr. Gutierrez.
Mr. CONRAD. Mr. President, today I want to share a few thoughts on
the nomination of Carlos Gutierrez to be Secretary of Commerce.
The Commerce Department has responsibility for a broad range of
important issues. Managing this diverse portfolio would be difficult in
the best of circumstances. But there are a number of special challenges
that make the job facing Mr. Gutierrez even tougher.
Let me start with trade. A couple of days ago, the Commerce
Department reported that our trade deficit for November exceeded $60
billion. Twelve years ago, our trade deficit for the entire year was
just $40 billion. Now, it is on track to exceed $600 billion. This
course is unsustainable. If we do not start taking steps now to address
this imbalance, we could face a collapse in the value of the dollar
that would spark inflation, roil our markets, and dampen our economic
prospects for years to come.
I hope Mr. Gutierrez will take this issue very seriously. We need to
make it clear to our trading partners that it is no longer acceptable
for them to devalue their currencies to gain a competitive advantage
over American producers. We need to strictly enforce our laws against
unfair trade practices. We need to insist that our trading partners
comply with the trade agreements they have signed with this country.
And we need to forcefully advocate for global trade rules that will
unequivocally benefit U.S. businesses, farmers, and workers.
I want to touch on one issue in particular. During Mr. Gutierrez's
tenure as CEO, Kellogg lobbied to increase sugar imports into this
country. Sugar is a vital industry in my part of the country. The sugar
industry pumps $2 billion a year into the economy of the Red River
Valley in North Dakota and Minnesota. So it concerns me greatly when
anyone suggests we should dismantle our successful sugar program to
take in more foreign sugar. I had the opportunity to visit with Mr.
Gutierrez a few days ago, and he has assured me he understands that as
Secretary of Commerce he would be representing all U.S. businesses,
including the U.S. sugar industry, and not just the interests of sugar
consuming companies.
We also face big challenges on a host of domestic issues within the
jurisdiction of the Commerce Department. For example, over the next 2
years, the Congress will be revisiting the 1996 Telecommunications Act.
In the 8 short years since that act was passed, we have had a
revolution in communications technology that will require us to rethink
many of the rules we adopted then. As we do so, it is critically
important that rural areas not be left behind. I have always been a
strong supporter of the Universal Service Fund and the assistance it
provides to North Dakota. I remain dedicated to making sure rural areas
have access to innovative and affordable telecommunications technology,
and look forward to working with Mr. Gutierrez on initiatives to close
the technological gap between urban and rural areas.
Carlos Gutierrez brings an impressive business background to this set
of challenges. Born in Cuba, raised in Florida, Mr. Gutierrez started
his career working for Kellogg in Mexico. From that start, he was
steadily promoted until he became chairman and chief executive officer.
As CEO, he has been credited with turning Kellogg around. It is my hope
that he will have the same success in turning around our trade policy
and bring the same energy to tackling the domestic challenges under his
purview.
Mr. LEVIN. Mr. President, I heartily support the nomination of Mr.
Gutierrez to be Secretary of Commerce. In nominating Kellogg's CEO
Carlos Gutierrez to be the next Secretary of Commerce, President Bush
selected a Michigander who has a wealth of business experience both in
the U.S. and abroad which gives him a unique understanding of our
country's role and challenges in the global marketplace. He also has a
proven track record of wise budget management.
Mr. Gutierrez represents the quintessential American dream,
emigrating to this country with his parents at the age of 7 from Cuba
and working his way up the ranks of the Kellogg Company, starting with
selling Kellogg cereal from a van, stocking the shelves of his
customers, to becoming the highly respected President and CEO of a top
American Fortune 500 Company. His story is as American as Corn Flakes
and baseball. He is a passionate fan of both.
Mr. Gutierrez's home is in Battle Creek, MI, a medium-sized,
midwestern city in America's heartland. Mr. Gutierrez has a firm
grounding in many of the values and strengths that make this country
great. He also has a firm grasp of some of the challenges facing
American manufacturers.
The U.S. has battled for decades to open foreign markets to U.S.
goods. Carlos Gutierrez knows the ropes of those markets and can
provide this Nation with that invaluable experience. I have confidence
that he will recommend firm action both to pry open foreign markets now
closed or partially closed to American goods as well as to reinvigorate
America's manufacturing base.
The leadership that Mr. Gutierrez used to turn around Kellogg's
financial standing is desperately needed in this country, which has
seen high unemployment, record trade deficits, and an unprecedented
loss of manufacturing jobs. Mr. Gutierrez will need every bit of his
experience to meet the challenges of this new job.
We are facing a manufacturing jobs crisis in our country. The U.S.
lost a record number of manufacturing jobs during President Bush's
first term, 149,000 of which were in Michigan. Michigan's unemployment
rate stands at 7 percent, the third worst State in the Nation.
Unfortunately, this crisis has been worsened by the administration's
failure to fund many of the programs that could strengthen the
manufacturing sector. The Commerce Department's Manufacturing Extension
Partnership program, for example, which helps small and medium-sized
manufacturing companies remain competitive and has led to $8.7 billion
in sales and helped create over 100,000 manufacturing jobs in the past
four years, faced an 88 percent cut in the President's 2004 fiscal year
budget request and a 63 percent cut in the 2005 fiscal year request.
The President also proposed eliminating the Commerce Department's
Advanced Technology Program, which encourages public-private
cooperation and focuses on improving the competitiveness of American
companies in the global marketplace. Manufacturing jobs pay high wages,
provide health benefits and offer retirement security. We cannot afford
to lose these good jobs or let them leave our country. I am hopeful
that as Secretary of Commerce, Carlos Gutierrez will prove to be a
strong advocate for these programs.
In addition to rebuilding our base of manufacturing jobs, we need to
devise a trade policy that focuses on opening foreign markets rather
than employing policies that encourage jobs to move overseas or
tolerating foreign barriers to our goods and expanding trade deficits.
During his time at Kellogg, Mr. Gutierrez managed several of the
company's international divisions, including serving as the general
manager of Kellogg of Mexico, the president and CEO of Kellogg Canada,
Inc., and the
[[Page S125]]
president of Kellogg Asia-Pacific. These experiences provide him with
the expertise needed to address our soaring trade deficit and create a
climate where U.S. products have the same access to foreign markets as
we give in this county to foreign products.
The U.S. trade deficit has soared to record levels in the past 4
years. We have a failed trade policy as a nation because we have not
insisted that our trading partners grant us true reciprocity and we
have not forcefully implemented our trade laws.
The U.S. needs to fight much harder to open foreign markets to U.S.
goods. In 2003, we had a $124 billion trade deficit with China, and it
is expected to exceed $150 billion in 2004; we have a large and
persistent automotive deficit with Japan; and we have tolerated
currency manipulation by several of our trading partners who have
rigged their currency values, making their exports artificially cheap
and thus giving their companies a huge trade advantage and devastating
U.S. workers, farmers and businesses.
We can reduce this trade deficit by insisting on a level playing
field with our trading partners; by closing tax loopholes that provide
incentives to businesses to move jobs overseas; and by supporting
efforts to ensure that China complies with commitments it has made to
the World Trade Organization.
We also need to adequately fund the Trade Adjustment Assistance
program, which provides relief for small and medium-sized manufacturing
and agricultural companies that experience loss of jobs and sales
because of foreign imports. These are all areas that would come under
Mr. Gutierrez's jurisdiction as Secretary of Commerce.
The nomination of Mr. Gutierrez is part of an overhaul of President
Bush's economic team. I am hopeful that this reorganization also
represents a new direction for the country, and that we are able to
rebuild our manufacturing sector and reverse our trade deficit. Mr.
Gutierrez's background at Kellogg has given him the experience to take
the important steps that are necessary to begin to do that.
Mr. LEAHY. Mr. President, I am pleased today to express my support
for the nomination of Carlos Gutierrez to be the next Secretary of
Commerce. Mr. Gutierrez's personal history is remarkable. Born in
Havana, Cuba, Mr. Gutierrez came to the United States at the age of
six. He learned to speak English from a hotel bellhop and at the age of
20, he began working for the Kellogg Company as a truck driver in
Mexico City. A little less than 25 years later, Mr. Gutierrez was in
charge of the entire company as the chief executive officer and
chairman of the board. As CEO, he quickly turned the battered and
declining Kellogg into a strong, stable and increasingly profitable
company.
While the next Secretary of Commerce will face serious challenges in
coming years from a surging trade deficit to a depleted domestic
manufacturing base to a weakened dollar--I am confident that Mr.
Gutierrez is more than capable to do his agency's part in taking on
these challenges. I believe that Mr. Gutierrez will bring the same type
of leadership and determination to the Department of Commerce that he
has shown throughout his career in the private sector.
I commend the President for making this nomination. Although Mr.
Gutierrez and I may not agree on all economic issues, there is every
indication that he will serve our country effectively and fairly as the
Secretary of Commerce. I am proud to support his nomination.
Mr. DOMENICI. Mr. President, I rise today in strong support of the
nomination of Carlos Gutierrez to be Secretary of Commerce. Mr.
Gutierrez has set a great example for all Americans and has proved
himself a true leader and visionary in the world of business. It is for
this reason I fully support his nomination and I have no doubt he will
be a truly superb Secretary of Commerce.
Carlos Gutierrez's story is truly inspiring and sets a wonderful
example for all Americans. Born in Cuba, Carlos, along with his family
fled to the United States in 1960 to escape the dictatorship of Fidel
Castro. Eventually, the Gutierrez family chose to live in Mexico and
settled in Mexico City.
At the age of 20, Carlos Gutierrez's journey through the world of
business began when he took a job driving a truck for the Kellogg
cereal company in Mexico City. Within 10 years, Mr. Gutierrez proved
himself an invaluable asset to the company and was promoted to general
manager of Kellogg's entire operation in Mexico. Only 15 years later,
Mr. Gutierrez achieved the unthinkable and began running the operations
for the entire company. This is truly a prime example of the American
dream and definitively demonstrates Carlos Gutierrez's considerable
talent for business.
I am also pleased by this nomination because of the diversity it adds
to President Bush's Cabinet. This President has demonstrated a
commitment to selecting Americans from all walks of life and ethnic
backgrounds to serve him, and I believe that the selection of Carlos
Gutierrez is a clear sign of the contributions that Hispanic Americans
are making to our Nation.
I believe as Secretary of Commerce, Carlos Gutierrez will continue to
display the values and leadership which have been prevalent throughout
his career. I have no doubt that as Secretary of Commerce Mr. Gutierrez
will be able to meet any challenge facing this country in the future.
Mr. HATCH. Mr. President, I rise to express my support for Mr. Carlos
Gutierrez as our new Secretary of Commerce.
Considering the global nature of the marketplace, Carlos Gutierrez is
an outstanding choice for Secretary of Commerce. Without a doubt, Mr.
Gutierrez possesses the necessary skills to assume this important
position. His skillful leadership has brought strong growth and success
to one of the world's most notable companies. Because of his many years
with the Kellogg Company, Mr. Gutierrez understands how to create jobs
and foster greater opportunity for all Americans. I believe that Mr.
Gutierrez will do an excellent job in creating conditions for economic
growth and opportunity by promoting innovation, entrepreneurship,
competitiveness, and stewardship.
Consumer demand, rising sales, and increased profits are creating
confidence in the growing economy. For example, in my home State, the
Utah Department of Workforce Services confirms that Utah added 32,200
new jobs in 12 months ending on October 31, 2004, and the Salt Lake
City-Ogden metro area topped the list of U.S. cities in the growth rate
of women-owned businesses. According to the Department of Labor, Utah
ranks third in terms of the largest one-year percentage gains in non-
farm employment. And, just recently, Forbes magazine named Headwaters,
Inc., a Utah-based alternative energy technology company, as second of
the top 200 best small companies in the United States. These are just a
few of many indicators proving that President Bush's policies are
succeeding in creating jobs and expanding the economy.
I look forward to working with Mr. Gutierrez, as he is undoubtedly
qualified and prepared to take the helm of the Commerce Department. Of
course, Mr. Gutierrez has many challenges ahead of him, but I am
confident that he will serve our country with dedication and
distinction.
Mr. FRIST. Fortune magazine describes him as possessing ``disarming
charisma, steely resolve, and an utter lack of pretension.'' The
President of the United States hails him as a ``great American success
story.''
It is my pleasure to support the nomination of Carlos Gutierrez,
chairman and CEO of the Kellogg Company, to become America's next
Secretary of Commerce.
Mr. Gutierrez is a true testament to the American Dream. From humble
beginnings as a Cuban refugee, he has become one of the most respected
and admired businessmen in America.
Mr. Gutierrez and his family fled Cuba when he was just 6 years old.
His father ran a successful pineapple company in Havana. Then one day,
there was a knock at the door. Fidel Castro's regime had named the
elder Gutierrez an enemy of the state. Mr. Gutierrez's father was
briefly imprisoned. The business was confiscated. Mr. Gutierrez recalls
that, ``We were on a plane right after that.''
The family landed in Miami Beach in 1960. It was there that 6 year
old Carlos learned English from hotel bellhops.
The family eventually settled in Mexico City, and at the age of 20,
Mr.
[[Page S126]]
Gutierrez took a job driving a Kellogg van selling frosted flakes to
small grocery stores.
Ten years later, he became general manager of Kellogg's Mexico
operations. Within 3 years, he turned the Mexico plant from the
company's least productive to most productive.
After stints in Asia and Canada, Mr. Gutierrez returned to the United
States in 1990, and in 1999 became Chairman and CEO of the Kellogg
Company.
In 5 short years, Mr. Gutierrez has steered the cereal maker into the
number one spot in the U.S. cereal market. Under his leadership Kellogg
has become a food industry powerhouse with industry leading sales
growth.
Those who have studied his business techniques say that Mr. Gutierrez
is successful because he is able to focus in on the key issues and
convey his vision to everyone--from the assembly line worker to members
of the board. He believes that every American should have the
opportunity to succeed.
He also believes that America is, and should be, the best place in
the world to do business.
Former Governor John Engler of Michigan, who has worked with Mr.
Gutierrez, rightly points out that Mr. Gutierrez would be ``the most
international leader that Commerce has ever had.''
Mr. Gutierrez says that one of his proudest accomplishments was
helping his son and his wife become American citizens. From one
American citizen to another, I can assure him the pride is mutual.
From his remarkable biography, to his meteoric success, Mr. Gutierrez
is an inspiration to all. He took the American dream and ran with it--
and, I should note, without ever having finished college.
I am confident that his accumulated wisdom, knowledge and skills will
make Mr. Gutierrez an effective Commerce Secretary and eloquent
advocate of our economic policies and ideals.
I urge my colleagues to support the nomination of this extraordinary
American.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. STEVENS. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. STEVENS. How much time is remaining?
The PRESIDING OFFICER. The Senator from Alaska has 45 minutes
remaining.
Mr. STEVENS. Has the minority no time remaining?
The PRESIDING OFFICER. Three and a half minutes remaining for the
minority side.
Mr. STEVENS. Is it possible to get permission to yield back the
balance of the minority's time?
The PRESIDING OFFICER. The Senator may ask consent to do so.
Mr. STEVENS. I ask unanimous consent all time be yielded back.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. STEVENS. I ask the Chair to put the issue before the Senate.
The PRESIDING OFFICER. The question is, Will the Senate advise and
consent to the nomination of Carlos M. Gutierrez to be Secretary of
Commerce.
The nomination was confirmed.
Mr. STEVENS. I ask that the President be immediately notified of the
confirmation of this nominee.
____________________