[Congressional Record Volume 152, Number 87 (Thursday, June 29, 2006)]
[Senate]
[Pages S6746-S6770]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
UNITED STATES-OMAN FREE TRADE AGREEMENT IMPLEMENTATION ACT
The PRESIDING OFFICER. Under the previous order, the Senate will
proceed to the consideration of S. 3569, which the clerk will report.
The legislative clerk read as follows:
A bill (S. 3569) to implement the United States-Oman Free
Trade Agreement.
Mr. BAUCUS. Mr. 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. BAUCUS. 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the quorum call be rescinded.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. BAUCUS. Mr. President, in 1833, a merchant named Edmund Roberts
piloted the U.S. warship Peacock to the port of Muscat, the capital of
today's Oman. Roberts bore a letter from President Andrew Jackson to
the Sultan Said. Three days later, Roberts and the Sultan signed a
Treaty of Amity and Commerce. This was the first treaty between America
and Oman, 1833. That treaty with Oman was part of a bigger picture, of
course. That bigger picture included Siam, today's Thailand, and Cochin
China, today's Vietnam. Edmund Roberts also traveled to those countries
to initiate broader commercial ties.
Today we are considering implementing legislation for another treaty
with Oman, a free-trade agreement. Today I ask again, what is the
bigger picture? From where I stand, the bigger picture is a grim one.
It is a picture colored by resentment, frustration, and broken
promises.
This agreement, as others in the past, will be overshadowed by the
unfair process by which the agreement was considered. The substance of
the Oman agreement, like others, is largely good. The Omanis have made
real progress in liberalizing their economy, ensuring their markets are
open and fair, and improving their labor laws to meet internationally
recognized norms. Yet the memories of this agreement that will linger
will not be tariffs, labor laws, or intellectual property rights
protection. Regrettably, what will linger will be a feeling that these
trade agreements were pushed through Congress without appropriate
consultation. I don't say that lightly, and I don't say that for
partisan purpose because I, frankly, don't regard myself as a partisan;
rather, someone who is trying to get the job done, working the Senate's
business for the good of all Americans.
The Senate considers trade agreements under what is called the fast-
track process. Congress agreed to this fast-track process in exchange
for the assurance that the Finance and Ways and Means Committees would
have an opportunity to influence these trade bills in what is called a
mock markup. In these mock markups, the Finance Committee and the Ways
and Means Committee can offer amendments to the bills. Under a fast-
track process, that is the last time anyone in Congress gets a chance
to change the bills.
During the mock markup of the Oman agreement--we call them mock
markups because they are not traditional markups in which members of
the committee can offer amendments which are then passed. Rather, the
amendments that are offered and passed are really not part of
legislation. Again, they are indications of what should be in the trade
agreement, indications to the administration that when it sends up a
trade agreement, it would be wise to include these amendments which
members believe should be included.
During the mock markup of the Oman agreement, the Finance Committee
voted 18 to 0 to approve an amendment offered by Senator Conrad. The
committee later approved the amended language unanimously.
But rather than consider these unanimous actions by the committee,
this administration simply stripped the amendment from the implementing
legislation that is before us today. There was no consultation. There
was no mock conference to fairly consider all views.
This kind of process cannot continue. The sad truth is that at the
end of the day, it won't. If the administration continues to disrespect
the constitutional authority Congress exercises over international
trade, there won't be any fast-track process at all. Once trade
promotion authority expires mid-next year, it simply won't be renewed.
That is not the result I want, but that is where we are headed. I have
been warning for years that the process failures threaten to undermine
support for the fast-track procedures that allow us to negotiate free-
trade agreements, and that is exactly where we are today. Good trade
agreements will not receive the support they might because of a
widespread failure in the Congress and the administration to listen to
the concerns of Congress. And the chance of renewing trade promotion
authority when it expires mid-next year is a long shot at best.
As I said during the markup in the Finance Committee yesterday, this
disrespect for congressional power and prerogatives--after all, it is
the Congress under the Constitution which sets trade policy--is not
confined just to trade agreements. It runs to other matters as well, an
accumulation of matters. It runs to other pressing issues of national
concern.
The administration dismisses congressional inquiries as unnecessary
or harmful--legitimate inquiries--and the administration issues
Presidential signing statements indicating the administration's intent
to ignore whatever provisions of the law it chooses. I believe the
Senate has not been sufficiently aggressive in asserting its authority
as a coequal branch of Government. I commend Senator Specter for
holding a hearing in the Judiciary Committee on Presidential signing
statements. As an institutional matter, and for the good of the
country, the Congress must act as a check on the power of the executive
branch. Our Founding Fathers set the Constitution up that way. We were
set up for one to check the other, not for one to run roughshod over
the other, which is beginning to happen.
After much consideration and deliberation, I have decided to support
this Oman Free Trade Agreement. It was not an easy decision, but I will
do so because I believe that Oman and the Omani people should not be
punished by the unfair process that tarnishes an otherwise good
agreement.
Let me assure you that I will not forget these shortcomings and
process failures after this vote. Let me assure you as well that the
effects of these shortcomings and failures will continue to be felt
when we consider further trade agreements and when we consider trade
promotion authority next year.
The administration must understand that its action on this agreement
will have effects far beyond and long after this agreement. I would
like to work with the administration to repair the damage done. It will
be a difficult job, but for the sake of the Senate and the Nation's
economic well-being, we must begin that work.
Mr. President, I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. GRASSLEY. 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. GRASSLEY. Mr. President, I yield myself such time as I might
consume on the Oman Free Trade Agreement.
The PRESIDING OFFICER. The Senator is recognized.
Mr. DORGAN. Mr. President, will the Senator yield for a unanimous
consent request?
[[Page S6747]]
Mr. GRASSLEY. Yes, I will.
Mr. DORGAN. Mr. President, I ask unanimous consent that I be
recognized at such time the Senator completes his statement.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. GRASSLEY. Mr. President, before I speak to the issue of the Oman
Free Trade Agreement, I wish to take advantage of the opportunity to
remind the public that trade agreements are not treaties, as we usually
think of treaties, with just the Senate approving treaties with a two-
thirds vote and the House of Representatives having nothing to do with
a treaty. A free-trade agreement is negotiated by the President but
must be approved by both Houses of Congress the same way that
legislation is passed, except it is done under a time agreement under
law with the idea that the agreement will be voted up or down and not
amended But when the dust settles, it is the law of our land, just like
any other law that Congress would pass.
Taking that into consideration then, the rationale behind that is the
fact that the Constitution gives the Congress of the United States, as
one of its specific 17 powers, the power to regulate interstate and
foreign commerce. A free-trade agreement is foreign commerce. Congress
has the authority completely--no questions asked--about what our trade
laws are going to be.
Until the 1930s, for the most part, Congress passed those pieces of
legislation, and that was the law after the President signed them. But
starting in the 1930s, Congress would, to a greater extent or lesser
extent from time to time, give the President the authority to negotiate
certain agreements, and then Congress would approve them.
Since World War II, we have had a regime for 45 years that we called
the General Agreement of Tariffs and Trades. Since about 1993, it has
been referred to as the World Trade Organization, or WTO.
In not exactly the same way, but from time to time, Congress, in
order to negotiate agreements since World War II, has extended
authority to the President to negotiate those agreements, not because
Congress wanted to give up any congressional authority as the
Constitution prescribes over foreign trade, but, as a practical matter,
if you are going to negotiate with another country, rather than
unilaterally setting policy, Congress, as a body of 535 people, can't
negotiate with another country or, for sure, with the World Trade
Organization that has 149 members very efficiently, and never even
tried. So from time to time we have negotiated--or we have delegated--
to the President of the United States, under strict guidelines, the
authority to negotiate for Congress with an understanding that--well,
under the Constitution with the practical end result that it has to be
passed by the Congress of the United States by a majority vote in both
Houses to become the law of the land.
Congress doesn't just willy-nilly say to the President: You negotiate
any sort of an agreement you want. In the basic law, there are some
stipulations--not very many but some--but, more importantly, for the
Congress to preserve its power and not give the President of the United
States free reign. We have a consultation process within what we now
call Trade Promotion Authority where, during the process of negotiating
multilaterally under the World Trade Organization, or negotiating
bilaterally with another country, that the President and his
negotiators would come to Congress whenever we would invite them, or
even on their own initiative, and sit down and talk, sometimes in
informal sessions, sometimes in regular committee meetings, to find out
how the negotiations are going and what the problems are.
But the most important thing is for that negotiator and that agency
to hear what Congress says needs to be done, what our input is, with
the idea that if they don't negotiate something that Congress can pass,
what good is doing the negotiation? So that consultation process is
very important.
Now, sometimes I feel that there has not been enough consultation,
and because I am chairman of the committee that has jurisdiction over
that, sometimes I can legitimately claim fault for not having enough
consultation, although we have considerable. And any members of the
committee should likewise--the other 19 members of the committee should
likewise feel that if there is not enough consultation, then maybe they
have not been forward enough in preserving the constitutional power of
the Congress and the specific authority of our committee to make that
consultation happen.
Now, what sometimes happens--maybe every time--in bringing a Free
Trade Agreement before our committee before it comes to the floor,
there is an outburst on both sides of the aisle about not having
consulted enough and that the process might be a sham. Well, the extent
to which people feel that is the situation, then I guess I plead with
myself as chairman of the committee, I plead with members of the
committee, that we need to make more specific requests of the
administration to come and talk to us about these agreements.
That can be going on right now in regard to the Doha round of
negotiations that are going on between the United States as part of the
World Trade Organization involving another 148 countries, or it can be
going on right now anytime the committee members want it to happen in
our process of negotiations with Thailand bilaterally, South Korea
bilaterally, Egypt bilaterally, and there are other countries as well.
So I hope that each one of us in Congress feels that we are
adequately safeguarding our constitutional authority. But I hope nobody
lives in the wonderland that somehow Congress ought to be negotiating
directly with these other countries because we don't have that
capability or the time. But we ought to make sure that we don't
compromise one iota the constitutional power that we have been given
and that w have to cherish and protect.
I rise in strong support of the United States-Oman Free Trade
Agreement. The agreement will help cement our ties with a strong ally
in the Middle East. It will contribute to greater economic opportunity
and prosperity in the region. It will serve as a strong model for other
economies in the region, and it will create new market access openings
for farmers, manufacturers, and service providers in the United States.
So I urge my colleagues to support the agreement in a strong bipartisan
fashion.
We have enjoyed beneficial relations with Oman for nearly 200 years.
In 1833, Oman was one of the first Arab states to sign a Treaty of
Amity and Commerce with the United States. It was also the first Arab
country to send an ambassador to our country. Our agreement with Oman
is the fifth trade agreement that we concluded with a country in the
Middle East.
It brings us one step closer to our President's vision of having a
Middle East free trade area by 2013. The President's goal is very
simply the same as every other free-trade agreement: to foster economic
growth. But it isn't just an economic issue. It has something to do
with promoting democracy, and millions of people every day doing
business agreements around the world is going to do more for world
peace than what we who are elected and our diplomats can do. So you
ought to see a free-trade agreement not only economically in our
interests, but promoting moral principles of democracy and peace
through enhanced commercial ties with the world generally; in this
case, to a greater extent with the Middle East.
The fact is, open economies that are actively engaged in
international commerce tend to grow at much higher rates than closed
economies, and that translates into greater economic opportunity. So a
free trade area is in the best interests of the people of the Middle
East, and it is in our best interests as well, but it is also in the
interests of stabilizing that area and having peaceful relations and
greater peace around the world.
This agreement enjoys strong support in the business community and in
the agricultural community. It has been endorsed by a number of groups.
I can't name them all, but I think it is important to note that the
American Farm Bureau Federation, the American Chemistry Council, the
Association of Equipment Manufacturers, the National Foreign Trade
Council, and the U.S.-Middle East Free Trade Coalition are among those
of over 110 companies and associations supporting trade expansion in
the Middle East, including this agreement.
These groups recognize that this is a commercially meaningful
agreement
[[Page S6748]]
that is leveling the playing field for U.S. businesses. In the United
States, Omani products already receive a substantial market access,
with most duties ranging from zero to 5 percent. Without this
agreement, U.S. exports won't have a level playing field, and haven't
up until now had a level playing field, because they would continue to
face those steep tariffs that Oman now has and will be giving up with
this agreement.
While the economic effect of the agreement may be small in total
world trade, it will certainly be possible. Upon entering into force--
in other words, when it becomes the law of our land--this agreement
will have Oman grant immediate, duty-free entry to virtually all U.S.
industrial and consumer products. As examples, in agriculture, 87
percent of Oman's tariff lines will go to zero for U.S. agricultural
exports on day one of the agreement and the remaining tariffs will be
phased out over 10 years. U.S. service providers will also receive
substantial improvement in market access. I have constituents who are
interested in seeing this agreement implemented, and I expect many of
my colleagues do as well.
I will give you just a few examples. A small business located in
Cedar Rapids, IA, Midamar Corporation, will benefit from new
opportunities and low costs for specialty food exports that are
specifically processed for Muslim diets. The HNI Corporation in
Muscatine, the second largest manufacturer of office furniture in North
America, will benefit. It has a fast-growing market in the Middle East.
HNI expects to forge new business ties in Oman once the agreement
enters into force.
Another company is Lennox in Marshalltown, IA, manufacturing heating
and cooling products. This agreement will promote increased exports for
Lennox.
In sum, I expect this agreement will have a real and positive impact
for my constituents in Iowa, preserving or establishing good-paying
jobs, because exporting jobs pay 15 percent above the national average,
and if it does that in the State of Iowa, it will be the same across
the United States.
In addition to pointing out the benefits of the agreement, I would
respond to just a few criticisms. Some are alleging that this agreement
will provide foreign port operators an absolute right to establish and
acquire operations to run port facilities in the United States. That is
just plain wrong.
The truth is, nothing in our agreement with Oman diminishes our right
to determine for ourselves whether to block or unwind any foreign
investment in the United States when the protection of essential
security interests are at stake That includes any potential investment
in land or site aspects of port activity in the United States. So our
ability to advance our national security and promote it and protect it
as we see fit remains fully protected under this agreement.
Separately, some colleagues have been critical of the process by
which this agreement has come before the Senate. In this respect, I am
repetitive of how I opened my remarks. In other words, I want to make
it clear that this has received substantial consideration by the
Congress of the United States. We concluded our negotiations with Oman
on October 13, 2005, with 7 months at the negotiating table and
opportunities for Congress to be consulted during that period of time.
The administration did that, both at the Member and staff level,
throughout negotiations. The agreement was signed January 19, this
year, and our own Government's agency, called the International Trade
Commission, issued its report on likely economic effects of the
agreement in February of this year.
The International Trade Subcommittee of my Finance Committee held
hearings on this agreement on March 6. The Finance Committee met May 18
to informally consider proposed legislation implementing this
agreement--the proposal that is pretty much as we have it before our
body this very minute.
During the committee's informal consideration, I introduced a
chairman's modification to the proposed statement of administrative
action. My modification called upon the administration to monitor and
report on the Omani efforts to prohibit compulsory or coerced labor.
The administration took my modification and broadened it. The
statement of administration action that accompanies the bill to the
floor of the Senate this very day contains a commitment from the
administration to update Congress periodically on the progress that
Oman achieves in realizing all commitments made to labor law reform. I
believe that is an improvement, even on my own modification. It is an
example of how the process of trade promotion authority worked in this
case and is a specific case of what I was trying to describe in the
opening of my statement.
In sum, this is a strong trade agreement with an important ally. I
urge my colleagues to enthusiastically support the implementation of
legislation before the Senate.
I yield the floor under the previous unanimous consent agreement so
that Senator Dorgan can have it.
The PRESIDING OFFICER (Mr. Graham). The Senator from North Dakota.
Mr. DORGAN. Mr. President, I regret I do not agree with my colleague
on the merits of this issue. But I do not regret coming to the Chamber
to speak on behalf of American workers, on behalf of our country's
interests. I come, once again, to talk about a trade agreement that I
believe is not consistent with what our country should be doing.
Let me talk about priorities. We have so many issues in front of us.
The other day, I read that the price of prescription drugs has risen
triple the rate of inflation in the first 3 months of this year with
the advent of this new Government prescription drug program for
Medicare recipients. Is there any action on that? No. That provokes a
very big yawn here in the Senate.
We have the highest budget deficits in history. We are going to add
about $1.4 trillion in debt to this country's shoulders this year--
$700-plus billion of trade deficits this year. We are going to borrow,
increasing the Federal debt $600-plus billion this year.
We have significant challenges in education and health care.
We have enormous challenges abroad. Obviously we are involved with
respect to the war on terrorism. There is a war in Iraq. There is no
proposition that anybody should pay for that war. Hundreds of millions
of dollars have been brought to the floor of the Senate to pay for it,
with the entire cost being added to the Federal debt. We send men and
women to risk their lives in Iraq. Some make the ultimate sacrifice on
behalf of their country and lose their lives. But there is no
discussion here about whether anyone else should probably sacrifice
some and be paying for the cost of this. In fact, the administration
does not even put money in their budget, when they send their budget to
us, for the operations in Iraq and Afghanistan. They do not put the
money in because they know then they can ask for emergency funding and
just add it to the top of the debt.
We have a lot of challenges. We cannot get action on the floor by
this Congress on the subject of stem cell research which will begin, I
hope, to unlock the mysteries of dreaded diseases--Parkinson's,
Alzheimer's, cancer, heart disease, diabetes, and more. Unlocking the
mysteries of those diseases is saving lives. It is pro-life. We can't
get a bill on the floor of the Senate to deal with that because we are
blocked from considering stem cell research on the floor of the Senate.
We need reimportation of prescription drugs so we can put pressure on
the drug companies to lower the price of prescription drugs for the
American people. We pay the highest prices in the world for
prescription drugs, and it is unfair. The U.S. consumer pays double,
triple, in some cases 10 times the price of prescription drugs that is
charged to virtually every other consumer in the world, and we can't
get a piece of legislation on the floor of this Senate to consider
allowing the reimportation of the identical drug, often a drug that was
made in this country and then shipped to Canada.
We can't do those things. Those are not priorities for those who
schedule the floor of the Senate. But we can bring to the floor of the
Senate today a trade agreement, a free-trade agreement with the country
of Oman. Here we have another chapter in a book of failures--a free-
trade agreement with Oman.
[[Page S6749]]
Oman is a country with 3 million people run by a Sultan. I don't come
to the floor to in any way cast aspersions or to denigrate the country
of Oman. I have not been to Oman. But I do know a lot about trade
agreements. I have studied them. And this is what they are ultimately
about: the exporting of American jobs to countries where people work
for 30 cents an hour and you can work them for 12 to 14 hours a day, 7
days a week. This has caused at least 3 to 4 million jobs to be
eliminated from this country.
These free-trade agreements--and this Oman deal is yet another--these
free-trade agreements have given the green light to say: Yes, let's
ship American jobs overseas; and by the way, even as you ship American
jobs overseas, you can bring in low-wage labor from our southern
border; and by the way, you can run your income through the Cayman
Islands so you don't have to pay taxes.
My colleagues are tired of hearing about the Ugland House, but I am
reluctant to mention it again. There is one little house on Church
Street in the Cayman islands. It is, I believe, four stories. It is
called the Ugland House. It is home to 12,748 corporations. They are
not there, of course. That is their official address in order to avoid
paying U.S. taxes.
At any rate, these trade agreements, the so-called free-trade
agreements, are agreements that in most cases are reached in secret
negotiations, are then brought to the Congress under a procedure called
fast track. The Congress has actually voted on it. I voted against it.
It is absolutely preposterous that Congress decided to say, let's wake
up in the morning and put ourselves in a straitjacket and pass
legislation that makes sure we can't offer amendments to a trade
agreement. That is unbelievable, that Congress has done that, but it
has. So we now bring this to the floor under something called fast
track.
Fast track means this: Take it or leave it. Here is the agreement.
You didn't have any participation in drafting this trade agreement, you
have no ability to alter this trade agreement, but take it or leave it,
vote up or down, yes or no. That is the process.
With respect to this trade agreement, they actually have begun to do
a procedure called a mock markup. In my hometown, you would know what a
mock markup is: it is not a markup, it is just a mockery. So they had a
mock markup here in the Senate Finance Committee.
My colleague, Senator Conrad, and I believe Senator Bingaman, offered
an amendment to the mock markup of a free-trade agreement that is going
to be brought to the floor under fast track. That doesn't even sound
like English, does it--a mock markup brought to the floor under fast
track? So the mock markup is held, and my colleagues offer an amendment
that would ban products coming into this country that is produced from
sweatshops or slave labor. It passed unanimously in the Finance
Committee, in the so-called mock markup.
It turns out that the markup was a mock, or a mockery, because even
though that provision passed unanimously, it is not in the trade
agreement that emerged on the floor of the Senate. The question is,
What has happened to that amendment which was offered in the Senate
Finance Committee? Where in the world is Carmen San Diego? Where is
this amendment? Maybe we ought to send teams out to look for this
amendment. The amendment passed. It was unanimous. But it has just
disappeared. Another famous disappearing act.
This trade agreement with Oman is not the largest trade agreement.
This is not CAFTA, this is not NAFTA, this is not the free-trade
agreement of the Americas. Oman is a relatively small country, and in
saying that I do not mean to offend Oman. This is not about whether I
think Oman is a wonderful country or not a wonderful country. I want to
talk about the ingredients of this trade agreement.
Let me talk a bit about the major concerns I have with this
particular trade agreement with Oman. First of all, let me talk about
the organizations that oppose this trade agreement. The AFL-CIO,
Communications Workers of America, Teamsters, League of Rural Voters,
National Farmers Union, Presbyterian Church USA Washington Office,
Sierra Club, United Methodist Church, United Steel Workers, Western
Organization of Resource Councils, and many more.
Like NAFTA and CAFTA and all the other acronyms that describe recent
failures, this agreement fails to put any meaningful protections or any
meaningful labor or environmental provisions in the labor agreement. So
the lack of any effective provisions dealing with labor or the
conditions under which goods will be produced to be sent to America
means that it is just ``Katey, bar the door''; whatever happens,
happens; we are not going to care much about that.
But particularly recent revelations of massive labor abuses in Jordan
should give everyone some pause. The agreement with Jordan was supposed
to represent the gold standard with respect to labor standards. Now we
have seen recent examples of what has happened in parts of Jordan; that
is, human trafficking, 20-hour workdays, widespread failure to pay
wages.
Let me talk about last month's New York Times story, which described
how a free-trade agreement with the country of Jordan was used to
produce sweatshops all over Jordan. It turned out when the agreement
was signed in 1999, companies began to fly in so-called guest workers
to Jordan from countries such as Bangladesh and China to make products
in Jordan to sell at stores in this country--Wal-Mart, Target, and so
on. The conditions of these so-called guest workers can only be
described as slave-like. Let me read from the New York Times piece:
Propelled by a free trade agreement with the United States,
apparel manufacturing is booming in Jordan, its exports to
America soaring twentyfold in the last five years. But some
foreign workers in Jordanian factories that produce garments
for Target, Wal-Mart, and other retailers are complaining of
dismal conditions--of 20-hour days, of not being paid for
months, and of being hit by supervisors and jailed when they
complain.
Those are the conditions of sweatshop labor that manufacture products
in Jordan--by the way, products that used to be produced in this
country when we had a textile industry providing jobs to Americans, but
that has all migrated.
The question is, Should this sort of thing exist in sweatshops--not
only in Jordan but in other parts of the world--to allow products to be
produced under these conditions and sold in the United States? The
answer to that is clearly no.
Now, consider this: this agreement with Oman provides weaker labor
provisions than existed with respect to Jordan.
So with the supposedly good agreement in Jordan, we ended up seeing
workers from countries like Bangladesh being flown to Jordan, and
forced to work not a 40-hour workweek, but a 40-hour shift, $50 for 5
months of work for one worker, and frequent beatings of workers who
complain.
Let me show you some pictures--pretty ugly pictures--from Bangladesh.
I will show them for a reason, because it relates to trade agreements
that don't have labor protections, and it shows you the face of this
global economy. These pictures were taken by a journalist who witnessed
firsthand the beating of workers in Bangladesh. Here is an example of a
picture taken by a journalist of the beating. This, tragically, is a
man shot through the head--a worker subjected to violence and killing.
This is another picture of the beatings. Let me show a picture of four
young women, if I might, very young girls. You will notice that they
are tied together--working in factories, tied together to prevent them
from escaping.
Should there be labor standards in trade agreements? Do we give a
damn about this? Does this country care about this? I hope it does. But
there is no evidence of it because we are going to pass another trade
agreement today with no labor standards at all.
So all of the folks in this country who lost their jobs because they
wouldn't work for 30 cents an hour, all the folks in this country who
saw their jobs moved to Bangladesh, Indonesia, to Sri Lanka, to China,
and elsewhere because those who want to produce can find a way to
produce it there for 30 cents an hour, not pay health care benefits,
work people in unsafe factories, and work them in conditions of
sweatshop labor, to all of those people, I ask
[[Page S6750]]
this question on their behalf: Is this what competition is about? Is
this what this country should allow--allow the import of jobs in these
circumstances? The answer is clearly no. Yet this Congress will not put
labor standards in a trade agreement. It will not require an
administration to put labor standards in a labor agreement. The only
one which included labor standards was Jordan.
I just described to you the sweatshops in Jordan by which
Bangladeshis and others were flown by the planeload into Jordan to work
in sweatshops that produce products to be sent to American shelves. I
believe it is an outrage. It ought to be corrected. But it is not going
to be corrected with this kind of trade agreement.
I recall the movie ``Casablanca.'' I guess everybody understands the
famous words in ``Casablanca'' when the French police chief said he was
``shocked.'' He said: I am just shocked to find gambling in Rick's
Cafe. Of course, he wasn't shocked. Everybody knew there was gambling
in Rick's Cafe in ``Casablanca.''
These pictures ought to shock the sensibilities of everybody. But on
some level, we all understand this is going on. It's just a question of
whether we are willing to do something about it. Is this country
willing to do something about it? And if so, when? If not now, when?
Yet this trade agreement does not do a thing about it.
The country of Oman has 3 million people, and half a million people
in Oman are so-called guest workers. In fact, the majority of Oman's
workers involved in manufacturing and construction are not from Oman at
all. The majority of the workers in Oman are brought in from
Bangladesh, Sri Lanka, and other poor countries under labor contracts
to work in construction and factories.
The State Department's 2004 Report on Human Rights cited Oman for
cases of forced labor. And I quote:
The law prohibits forced or compulsory labor, including
children. However, there were reports that such practices
occurred. The government did not investigate or enforce the
law effectively. Foreign workers at times were placed in
situations amounting to forced labor.
They have changed the report just a little bit in anticipation of
having an Oman free-trade agreement brought to the floor, but the fact
is that this happens in Oman, and we know it happens in Oman.
There are no labor unions in Oman. In 2003, the Sultan of Oman issued
a Sultanic decree which categorically denies workers the right to
organize and join unions of their choosing. Under some circumstances, I
am told that workers in Oman can join ``representative committees,''
but they are not independent of employers. The Sultan of Oman has
written to the USTR, our trade ambassador, and promised that he will
improve Oman's labor laws by October of this year; that is, after the
Senate has voted to approve a free-trade deal with Oman.
The labor provisions in the Oman Free Trade Agreement are much weaker
than the labor provisions in the Jordan trade agreement, as I
indicated. They simply ask Oman to follow its own laws and its own
self-policing. If the supposedly model agreement on labor with Jordan
was such a disaster, think of what it will be with respect to the
country of Oman. But under fast-track rules, no one has an opportunity
to offer any amendment under any of these provisions.
Now, let me describe another point with respect to Oman. After going
through a heated debate some months ago over whether Dubai Ports World
should be able to manage a half dozen of America's major seaports, we
now find that there is a provision buried in annex II of this trade
agreement with Oman, which says that Oman has the right to acquire
companies that operate U.S. ports, and there is not a thing we can do
about it. This provision in the agreement was added to a list of U.S.
infrastructure functions that Oman can't be precluded from acquiring:
It is as follows:
[L]andside aspects of port activities, including operation
and maintenance of docks, loading and unloading of vessels
directly to or from land, marine cargo handling, operations
and maintenance of piers, ship cleaning . . .
There was a great deal of controversy about whether the United Arab
Emirates and a company owned by that government called Dubai Ports
World should be able to take over the management of a half dozen of
America's seaports. The answer from this Congress was absolutely not;
this country ought to have the capability to manage, for national
security purposes and other purposes, its own seaports.
Well, guess what. We have a trade agreement that comes to the floor
of the Senate which says, it is going to be all right if Oman takes
over our ports. Or for that matter, if a company from the United Arab
Emirates that has a subsidiary in Oman takes over our ports.
The folks at USTR say: Don't worry, be happy. There is an exception
in the Oman trade agreement that allows us to block acquisitions for
national security reasons.
Well, sure, that national security provision is in the agreement. But
it means nothing if the President is determined to let the deal go
through.
Here is what the President said about the managing of U.S. ports by
the United Arab Emirates. He said this on February 2, 2006:
Brushing aside objections from Republicans and Democrats
alike, President Bush endorsed the takeover of shipping
operations at six major U.S. seaports by a state-owned
business in the United Arab Emirates. He pledged to veto any
bill Congress might approve to block the agreement.
The President quite clearly has told the American people that he
thinks it is fine to have the United Arab Emirates run America's
seaports. Do you think he would think it was not fine for a company
owned by the Government of Oman to run America's seaports? It doesn't
seem to me he would have great objection to that. What do the
supporters of this agreement have to say to this point?
So this is where we are. They have a mock markup and then create a
mock trade agreement and have a mock disappearance of a provision
dealing with sweat labor, sweatshop labor, and then you bring it to the
floor, and we have a mock debate. Everybody is very quiet about it.
Then we have a vote on the floor of the Senate, and then it passes. It
always passes because there are not enough Senators here who care about
this question.
We import $2 billion a day from around the world above that which we
export. Each and every day, we are going $2 billion more into debt to
the rest of the world. Said another way, each and every day, we sell $2
billion worth of America to foreigners. Each and every day. And $700-
plus billion a year in trade deficits. We shuffle around here like
there is no hurry, no rush, no worry, be happy. It is unbelievable to
me. This is a very serious, unsustainable problem. We cannot sustain
this. It will cause a collapse of the dollar, and it will cause
economic difficulties you can't imagine unless this Congress gets
serious and this administration and this President get serious and
decide this is a serious issue which must be solved.
I have spoken often on the issue of trade, and I know there are
disagreements about these things. Let me describe the other side of it
because I can describe it easily.
They say that all who raise these questions are a bunch of
xenophobic, isolationist stooges; you do not have the foggiest idea
what is going on. You can't see over the horizon. This is a globalized
economy. The world is flat. Are you crazy? You want to build walls
around our country? What are you thinking about? That is the other
side. Therefore, they say, let's have free trade agreement after free
trade agreement because it is a global economy and it will all turn out
just fine. Of course, after each and every agreement we have reached,
we have had bigger and bigger problems.
We had a small trade surplus with the country of Mexico. We have a
trade agreement with Mexico, and it turns into a huge deficit. So we
are able to turn a small surplus into a huge deficit.
By the way, those hotshot economists who gave us all that advice--I
didn't take that advice, but the majority of my colleagues did--all
that advice saying this is going to be just fine; you should understand
this is a division of labor. What is going to happen in Mexico under
NAFTA is the low-skilled jobs are going to migrate to Mexico and then
we will get high-skilled, high-wage jobs back here as a
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result. Guess what our three largest imports are from Mexico:
automobiles, automobile parts, and electronics--all products of high-
skilled, high-wage labor. That is what migrated out of this country. We
turned a small surplus with Mexico into a huge deficit.
We turned a modest deficit with Canada into a large deficit. We
turned almost a balanced trade deficit with China a couple of decades
ago into the largest deficit in humankind. It is unbelievable what we
have done. Europe, very large deficit; Japan, an $80 billion-a-year
deficit; every single year with Japan, we have a large, recurring
deficit. This country had better understand the consequences of this.
This chart represents the trade deficit, and one would have to be
colorblind to not understand the consequence of this. You would have to
be in a situation where you can't see red. This is red, red, red,
growing in a dangerous way, giant trade deficits It is not getting
better, it is getting worse. This is simply one more chapter of a book
of failures.
What we have been doing is sinking this country into a sea of debt.
All of this debt reflects, by the way, the shipment of American jobs
elsewhere. We have nearly decimated our textile industry. We are taking
apart our manufacturing industry. And it doesn't end there.
I have told the story of Natasha Humphreys who was a software
engineer, Stanford graduate. Her last job for her company was to train
her replacement in India because an Indian engineer worked for about
one-fifth of the price of a U.S. engineer. So she lost her job.
This is not just textiles and manufacturing. Half of the Fortune 500
companies have been outsourcing software development.
That is what the lines on the chart mean. It started with textiles.
Everyone knows Fruit of the Loom underwear: T-shirts, shorts,
underwear. They would advertise with green grapes, red grapes, dancing
down the street. Everyone was happy. Underwear was made here. People
had jobs here. The grapes got jobs dancing on television.
Now, however, we do not see dancing grapes talking about American
jobs because there is no Fruit of the Loom underwear made in America.
That is all gone. There is not one pair of Levis made in America. Huffy
bicycles. That is all gone.
I could go on forever, and I have gone on forever, as a matter of
fact, in previous discussions about all of the brands. You may be
wearing Tony Lama boots, but if so you may be wearing boots made in
China. The list is endless.
We built in 100 years in this country something very unusual, and we
did it through pain and suffering and through agonizing and debate in
the Congress. Part of it was to decide: What kind of country are we?
How do we improve the standard of living? How do we build something
here that is unique? It was encouraging entrepreneurs, helping people
who had a vision to start a business, to take risks, to say go for it,
absolutely, to create a hospitable environment where people started
businesses and created jobs, and to say on behalf of workers: You have
a right, too, a right to organize unions, a right to have a safe
workplace, child labor laws. You cannot dump chemicals into the air or
water as you produce those things.
James Fyler was shot 56 times--56 times this man was shot. Do you
know why? Because in 1917 he believed the people ought to be free to
form a labor union to protest the conditions of coal miners deep in the
coal mines of Colorado. For that he was shot and killed; 56 times that
man was shot.
This history of our country is replete with the people who have
decided to exercise the bravery to help build this country and create
the standards, the work rules, and the opportunities that we enjoy. Men
and women who start businesses, men and women of the labor movement,
and Members of Congress decided what the rules are.
Now, in one swoop we can decide a company can move those jobs to
China, just like that, shut their American plant, move the job to
China--and, by the way, this Congress gives them a tax break for doing
so--ship the product back to be sold in this country, run the income
through the Ugland House on Church Street, and not pay taxes to the
United States.
None of that adds up. So today we have a trade agreement from Oman
which persuades me to show, once again, a chart with dancing grapes.
Does it relate? Yes, it does, because this is one more chapter in a
book of failures.
The question is, Will this country stand up for its economic
interests?
I say to Japan--we have had robust trade with the country of Japan
for decades. Yet every single year we have these large deficits with
Japan and the growing deficits with China which even dwarf the Japanese
deficits, yet our country does not seem to care.
All these deficits translate to lost jobs, they threaten this
country's economic future and whether we progress and improve the
standard of living and expand the middle class. Our government says,
you know something, this is a global economy. Whatever happens,
happens, and we do not want to offend anyone. We do not want to tell
China: Look, the way we will trade with you is this: our trade must be
fair trade; you open your markets to us, we open our markets to you;
but the methods of production must be fair.
We do not do that. We do not do any of that because we do not have
the nerve and the backbone or will to stand up for this country's
economic interests. Frankly, it baffles me that this will be passed
this afternoon. There is no question about it. This Congress will, once
again, snore through this discussion, and we will pass a trade
agreement with the country of Oman.
At the end of this year, we will see another record, the highest
trade deficit in history.
Alan Blinder is the former Vice Chairman of the Federal Reserve
Board. He is not some nut way off on the edge of the political debate.
This is a guy who is a mainstream economist. He has written in the
Foreign Affairs Journal that there are 42 to 56 million American jobs
that are subject to outsourcing.
Let me say that again: 42 to 56 million American jobs in
manufacturing, and especially the service sector, that are tradeable
jobs, subject to outsourcing. Not all of them will be outsourced, for
sure, but even those that remain here will be subject to competing with
those in other parts of the world who can do the job for less.
Does that matter to anyone? Doesn't that say to all of us what this
is really about? This is about reducing the standard of living in this
country. It is not about raising other countries up, it is about
pushing us down. That is why this trade strategy is wrong. I don't
believe in building walls. I don't believe we ought to decide we should
withdraw from the global economy. I just believe there ought to be
rules with respect to the global economy that stand up for this
country's interests.
For the first 25 years after the Second World War, we were the
biggest, the strongest, the toughest. We could beat anybody at almost
anything, and we knew it. With one hand tied behind our backs we could
trade with anybody and give concessional circumstances and win. It was
not a problem.
Then we saw the emergence of shrewd international competitors--yes,
Europe, Japan, and others--things changed. But our notions did not
change. Our trade policy is still a heavy dose of foreign policy that
is, in my judgment, soft headed. We still are concessional. We still do
not have the willingness to stand up for this country's economic
interests. And we now are seeing the results of that with the highest
trade deficit in history.
If I might show that chart one more time, the trade deficits on this
chart are the result of these trade agreements. Republicans and
Democrats, together--administrations run by both political parties--
have failed to do what they should do.
We have a trade deficit with almost every country. And those with
whom we do not have a deficit, if we can just get an agreement with
them, we will have a deficit. Every single agreement we have made
produces a deficit.
We have a huge trade deficit with Korea, which is another country
with which we are negotiating a free trade deal.
Here are the cars in Korea: 99 percent of the cars on the road in
Korea are Korean-made cars. Why? The Korean government doesn't want
other cars in Korea; 99 percent of the cars on the streets in Korea are
Korean made.
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In Korea, they exported 730,000 Korean cars to the United States last
year; 730,000 Korean vehicles were put on ships and sent to America. We
were able to export 4,251 into Korea. We almost had a success with the
Dodge Durango pickup, but they shut that down. And 95 percent of the
cars on the road in Japan are Japanese-made cars in that country. Why?
That is the way they want it.
Our country says: That is fine. It does not matter to us. I suppose
it is fine because nobody wearing a blue suit and suspenders is losing
their jobs. I don't see any CEOs losing their jobs. I don't see any
Members of the Senate losing their jobs. The folks making cars are
losing their jobs. The textile workers are losing their jobs. Family
farmers are having the rug pulled out from under them with bad trade
agreements, but folks here are safe. And this administration is, I
guess, probably the worst we have had for some while on trade.
But having said that, the Democratic administration that preceded it
was not particularly good on trade issues, and no one is very
interested in doing anything to address a serious and growing trade
problem, which if not addressed will cause havoc with this country's
economy and will affect every American worker in a very serious way.
It is probably clear to at least those hearing me that I will vote
against the Oman Free Trade Agreement. I think it is a serious mistake.
While I think it will pass today, we will await the next bad trade
agreement and continue this fight. At some point there will be a
tipping point on this issue. The American people will demand the
Congress to finally start doing the right thing. No, not building
walls, but demanding trade be fair, fair trade on behalf of this
country.
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. REED. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Chambliss). Without objection, it is so
ordered.
Mr. REED. Mr. President, I rise today to speak in opposition to the
Oman Free Trade Agreement.
International trade, if reached through the right paths, can confer
tremendous benefits on all of its participants. Through this practice
and agreements like this one, we have the opportunity not only to open
up market access for American business but also to improve economic
conditions for all participants.
Unfortunately, the Oman Free Trade Agreement fails to live up to that
potential. This agreement does not provide for American business, while
at the same time it fails workers both here, I believe, and potentially
in Oman.
In 2001, the United States entered into a similar trade agreement
with the country of Jordan. At that time, the agreement was heralded
for its progressive labor standards. However, we have recently seen in
Jordan instances of foreign workers forced into slave labor, stripped
of their passports, denied their wages, and compelled to work for days
without rest.
These incidents have been occurring in Jordan because Jordanian labor
laws are only applicable to its own citizens and preclude protections
for foreign workers.
What I sense is happening is that we have allowed, unwittingly, I
believe, individuals and corporations in Jordan to exploit this
agreement, to actually move people from countries outside of Jordan
into Jordan, and to set up conditions that are not only horrible for
the individuals but continue to put pressure on American working men
and women in terms of reduced wages, and also do not act to raise the
standard of living in Jordan.
One of the points of our agreement with Jordan was to provide the
kind of conditions that would raise the standard of living for
Jordanian workers. So I am terribly concerned about what could happen
in Oman.
My fear in Oman is that they have far weaker labor standards, and
that would lend itself to even worse conditions than in Jordan. In
fact, the potential for seeing these types of abuses is much higher in
Oman, where up to 70 percent of its workforce is comprised of foreign
workers already.
During the ``mock markup'' of this agreement last month--the practice
of the Finance Committee where they would go through and, in theory and
concept, make the changes they would like to see take place--the
Finance Committee unanimously approved an amendment to explicitly
prohibit products made with slave labor or through human trafficking
from benefitting from this deal, conditions similar to those in the
Jordanian Free Trade Agreement. However, the administration chose not
to include this simple, commonsense provision in the final implementing
legislation before us today.
When our trade partners are held to different, less stringent
standards, no one is better off. When Omani firms can employ workers in
substandard conditions, the Omani workers and American workers both
lose. The playing field is not level. The enforceable provisions of
this free-trade agreement require only that Oman and the United States
enforce their existing labor laws.
In Oman, this means that workers can be denied the right to
collectively bargain and to strike. More egregious, Omani law is vague
in its forbiddance of forced labor. I appreciate the commitments of
Oman to clarify these provisions and to improve enforcement. However,
the timeline for doing this is far too long. If we implement this
agreement, and Oman fails to live up to its promises, then this
agreement will benefit a few while hurting many.
I would note that part of the problem with all of these agreements is
that they are considered under the President's fast-track authority,
under which Congress is forced to take or leave even the most imperfect
deals. And when the President ignores valuable input from Congress,
particularly on issues such as labor standards, we are put in a
position where our only choice is to vote against it.
I am a supporter of free trade, but that does not require me to
support bad deals from an administration that is more concerned about
getting a deal than getting the deal right.
We cannot allow other countries to break the rules. Our foreign trade
partners must play by the same rules as we do because American
companies and workers cannot compete with countries that engage in
substandard labor practices. We have seen it again and again: trade
policies that don't establish a real threshold for labor standards do
not work.
So, Mr. President, I will vote against the Oman Free Trade Agreement.
Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. DODD. 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. DODD. May I inquire of the Chair, what is the pending matter
before the Senate?
The PRESIDING OFFICER. The Oman Free Trade Agreement.
Mr. DODD. I thank the Chair. I gather at some point the Senate will
be asked to vote on the trade agreement; is that correct?
The PRESIDING OFFICER. That is correct.
Mr. DODD. I thank the Chair.
Mr. President, this legislation effecting the U.S.-Oman Free Trade
Agreement is an important one. Implementing legislation for this
agreement is currently pending before the Senate and will likely come
up for a vote later this afternoon. Regrettably, I will be opposing
this proposal.
In the past, I have voted for many free-trade agreements. I think
they are very important. If well constructed, free-trade agreements are
essential if we are going to have a growing economy, and if the role of
the United States is going to be a positive one in the 21st century.
But too often these trade agreements neglect critical points when it
comes to how they affect American workers, as well as workers in the
country with whom we are entering into the agreement. As I said, I have
been supportive of a number of free-trade agreements over the
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years. I have also opposed a number of them. I will explain why and why
I think this particular agreement needs further work and consideration
before it is to be adopted.
Properly constructed, I believe that free trade agreements are in the
long-term interests of the United States and our trading partners.
Today's world is interconnected in ways we couldn't even imagine a
generation ago--even 5 or 10 years ago. Faster and more efficient means
of transport and communications have made it relatively easy to conduct
transactions of all types and in all corners of the globe.
Today, with Internet access, people in the most remote places are
better informed about what is happening than ever before.
Globalization has affected countries all around the world. From Latin
America to India, Africa to China, no nation has escaped the impact of
this process. The difference is that while globalization has helped
lift some nations up, it has left others way behind. While it has
helped certain entities in various countries, it has left many people
in those same nations staggeringly behind in their chances to enjoy
greater economic opportunity.
The march toward a more globalized world has significantly affected
our own Nation as well. On balance, I believe free trade has benefitted
our country in many respects. But quite simply, we haven't done enough
in many areas, especially during the past few years, to help ease the
transition for many Americans who are struggling. I know the Presiding
Officer comes from a part of the country where trade agreements can
have a huge impact on major sectors of the economy, as in our Southern
States where textiles have been a huge part of economic growth. If not
handled properly, for people in these States, many of whom are working
for businesses that not many years ago came from New England, trade
agreements can have a very negative impact.
Nor have we done enough to ensure a level playing field to ensure
that American businesses and workers are protected from would-be
violators of the rules.
Ultimately, trade agreements should be designed to lift up people in
both countries. I believe in free trade because in order to compete in
the global marketplace, America has to keep up and adjust to the
changes around us.
We can't just sell goods and services to ourselves and expect to have
a growing economy. It is critically important that we have access to
these foreign markets. Barriers and tariffs that prevent goods and
services from ending up on the shelves in those countries ultimately do
great damage to our Nation.
So free and fair trade is critically important to our own economic
success. Job loss would be staggering, if we were not able to open up
markets around the globe for U.S. products and services.
But for free trade to be beneficial and worthwhile, our trade
agreements must also adjust to changes that are occurring around the
world.
Much as I regret to say it, the U.S.-Oman Free Trade Agreement does
not reflect this reality. Although negotiators had a real opportunity
to learn from the past, to raise the standards and to produce a better
agreement, we can see in the agreement before us many of the same
problems that plagued previous free-trade agreements such as CAFTA-DR.
The issue of labor rights is one key example of how this agreement
falls short. I have long been an advocate of vigorous enforcement of
U.S. trade laws, especially with respect to those provisions that
require our trading partners to respect internationally recognized
rights of workers in their countries. Workers rights violations not
only give other nations an unfair trade advantage, they also hurt U.S.
workers by depressing wages here at home and causing American jobs to
be shipped overseas.
Certainly, Oman is not the egregious violator of workers rights that
some of our other trading partners are. Indeed, Oman has ratified the
International Labor Organization's Convention 29 on forced labor,
Convention 182 on the worst forms of child labor, Convention 105 on the
abolition of forced labor, and Convention 183 on minimum age of
employment. Oman has also ratified the United Nations protocol to
prevent, suppress, and punish trafficking in persons, especially women
an children.
On the surface, therefore, one might think that there is little to
worry about with respect to this agreement, which requires Oman to
enforce its labor laws. But this notion overlooks a simple fact--that
Oman's labor laws and its enforcement thereof is lacking. Collective
bargaining is still not legally enshrined in Oman, nor is the right to
strike. Existing law dealing with forced labor is vague. So asking Oman
to uphold its own laws is not holding that country to the high
standards necessary to protect U.S. workers.
While I understand that Oman is committed to improving its labor laws
and enforcement, we should first see some significant action on their
end to make sure that both United States and foreign workers are going
to be protected. Or better yet, use the ILO standards, not domestic
laws, as the benchmark for workers rights provisions in this and other
free-trade agreements.
Right now there is an October deadline that Oman has agreed to as a
target for achieving some reforms. Besides the late date, I have
serious doubts as to what incentives Oman will have to carry out these
reforms once this agreement is in place. If this agreement passes
before those reforms take place, as may be the case today, many of the
incentives for Oman to reform will be gone.
My colleagues should also be aware that we are not just talking about
how Omani laws will protect Omani workers.
The fact is that guest workers from impoverished Asian countries
perform much of the labor in Oman. These guest workers need to enjoy
the same worker protections as Omani citizens. To that end, we have
learned in the last 2 months of rampant labor abuses of foreign workers
in Jordanian sweatshops.
I don't mean to malign our friends in Jordan. They have been
wonderful allies, and very helpful on a number of issues that affect
the United States in that part of the world. I am hopeful that abuses
by unscrupulous employers in Jordan will be punished and prevented in
the future because even the best intentioned countries can never
prevent all occurrences of abuses. But given that the Oman Free Trade
Agreement has much weaker labor provisions than the Jordanian
agreement, the Oman deal certainly seems like it will be a recipe for
similar abuses in the future.
I also have concerns about a small provision included in the second
annex to the Oman Free Trade Agreement, in the section governing U.S.
rights and obligations. In that annex, it is stated that the ``United
States reserves the right to adopt or maintain any measure . . . ''
except ``landside aspects of port activities, including operation and
maintenance of docks.''
Simply put, this raises questions as to whether the United States
would be able to prevent Oman from acquiring companies that run U.S.
port operations without essentially being sued in the World Trade
Organization.
Why are we including provisions such as that in a trade agreement and
leaving ourselves vulnerable to legal action if we decide that it is in
our own self-interest, because of our concerns about terrorism and
national security, to prevent Oman from acquiring port operations in
the United States?
The only caveat to this section of the Oman Free Trade Agreement is
that Oman must provide similar market access to the United States. Now,
according to the U.S. Trade Representative, all of our trade agreements
include an article on essential security which basically provides that
nothing in the agreement can prevent us from applying measures that we
consider necessary for the protection of our essential security
interests.
That is all fine and well and would seem to indicate that the
President or the Committee on Foreign Investment in the United States
could still review proposed acquisitions. But why should our trade
agreements contain language such as this that is legally confusing at
the least and potentially opens us up to being sued, if we decide that
something is in our national security interest?
There are other issues I could raise about the content of the U.S.-
Oman Free Trade Agreement, but I believe that the two issues I have
mentioned are critically important and reason enough to oppose this
agreement.
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Once again, the Bush administration had an opportunity to use fast-
track authority to promote a trade agreement that would be in the best
interest of our Nation, of our workers and businesses. I wish that this
was the case when it comes to the Oman Free Trade Agreement.
Unfortunately, we are instead seeing more of the same disregard for
American workers in the pending proposal.
As a result, I intend to oppose this agreement and urge my colleagues
to review it very carefully, review the provisions dealing with labor
standards and review the standards when it comes to port operation
activities included in this free-trade agreement.
I should mention as well, another reason why I support strong labor
provisions in these agreements. It is critically important that our
trading partners have enough people who can afford to buy the goods and
services that we produce here in the United States. Even if countries
open up their borders to our goods, what percentage of their population
could ever afford our goods and services if they mainly receive low
wages and little or no benefits? The only alternative to strong labor
protections is that we drop the prices of our goods tremendously, which
would obviously be disadvantageous to our future economic prosperity.
The rationale for insisting that there be labor standards and decent
wages provided to these people is a wealth creation idea. Labor
protections, therefore, are not only about human rights, which is
legitimate enough, but are also about enlightened self-interest.
For those reasons, this agreement should not be approved. When the
vote occurs, I will be urging my colleagues to vote against it.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER (Mr. Vitter). The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. CONRAD. 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. CONRAD. Mr. President, I come to the floor today to oppose the
Oman Free Trade Agreement. There are two primary reasons that I oppose
this agreement.
First, this trade agreement is part of the administration's failed
trade policy. I believe strongly that we need to change direction, and
we need to change direction now, before our trade and budget deficits
cripple our economy.
This chart shows how badly off target our trade policy is. Our trade
deficits have exploded. In 1992, our trade deficit was just $40
billion. Thirteen years and 10 trade deals later, our trade deficit
last year was $718 billion--$718 billion.
NAFTA provides one example of how these trade deals have affected our
trade deficits. In 1993, the year before NAFTA took effect, we had a
trade surplus with Mexico of about a little less than $2 billion. Last
year, after 12 years of NAFTA, our trade deficit with Mexico had
mushroomed to $50 billion. So we went from a trade surplus with Mexico
to a massive trade deficit with Mexico.
Agriculture provides another example. When this administration took
office, we had a healthy trade surplus of $15 billion in agriculture.
But that surplus has been shrinking every year since then. This year
the surplus is expected to fall to just $2 billion, the smallest
agricultural trade surplus in 35 years. Yet we keep going down the same
path, trumpeting each agreement as a resounding success.
If this set of policies is a success, I would hate to see a failure.
How can anybody suggest that this is a success? We have gone from being
the biggest creditor nation in the world to being the biggest debtor
nation in the world, and a key reason are these failed trade policies
that over and over have promised the American people that they were
going to turn the tide, that they were going to make a difference, that
they were going to change the circumstance. And over and over they have
failed, not in the world of theory, not in the world of make-believe,
but in the real world, in the real world where we can measure the
results, and the results have been clear: We mushroomed the trade
deficit with this set of trade policies.
There is an old saying that the definition of insanity is doing the
same thing over and over again expecting a different result. Under that
definition, our trade policy is certifiably nuts. We need to stop
giving more than we are getting in trade agreements. We need to stop
sending American jobs overseas. We need to reduce our trade deficits.
And we need a trade strategy that will boost incomes for American
workers and farmers.
The agreement before us is a continuation of this failed trade
policy. We are not getting more than we are giving. When we read the
fine print and the study done by the United States International Trade
Commission, the nonpartisan U.S. agency in charge of analyzing trade
agreements, we discover that this agreement will increase our trade
deficit with Oman--will increase our trade deficit with Oman.
Why are we entering into more trade agreements that make our trade
deficit that is at record levels even worse? What kind of a plan is
this?
Imports of apparel from Oman will increase by $42 million annually,
according to the International Trade Commission. But the ITC says our
exports of all products to Oman will only increase by $14 million to
$41 million, depending on how responsive our exports are to tariff
reductions.
So this agreement, as I have said, actually makes our trade deficit
with Oman worse, not better. Perhaps it should not be surprising that
this agreement would increase our trade deficit. It is produced by an
administration that says that outsourcing jobs to other countries is a
good thing. It is produced by an administration that does not believe
in having other countries improve their labor standards so that
American workers don't have to compete with workers who are paid
pennies an hour to work in abusive conditions. In fact, this
administration has repeatedly rebuffed the efforts of my colleagues to
strengthen labor laws in Oman so that they meet international labor
standards.
I don't think this is a good agreement on its merits, but the process
by which it has come to the floor is even worse. The way this bill has
been brought to the Senate floor makes a complete mockery of the fast-
track process.
The fast-track process is now revealed, for anyone who cares to look,
as a complete sham. How so? As all Members of this body already know,
the Constitution gives the Congress, not the President, the
responsibility for regulating foreign trade. Yet in recognition that we
cannot have 535 trade negotiators, the Congress has agreed to the fast-
track process for considering trade agreements.
By the way, I have supported that approach in the Senate Finance
Committee. I thought it was the right approach to take, given the
commitments that were made to us on how these trade agreements would be
negotiated, how these talks would be conducted. But what we have seen
in this agreement is a flagrant failure to keep the agreement.
In agreeing to fast track, each Senator gives up their most
fundamental rights as a Senator. We give up our right to amend. We give
up the right to extended debate. In essence, we are giving up our right
to protect the interests of our individual States. In return, there is
supposed to be detailed consultation with the Congress throughout the
process of negotiating trade agreements and developing implementing
legislation.
In practice, the Finance Committee, of which I am a member, is the
focus of this consultation because the Finance Committee has
jurisdiction over trade policy. In theory, the committee has extensive
input during the process of negotiating trade agreements and developing
the legislation to implement it. Theoretically, it does not then need
to amend the implementing bill once it is formally introduced.
When it comes to developing the implementing bill, this consultation
occurs through what is known as a mock markup process. The mock markup
is the Finance Committee's opportunity to amend the implementing bill
before it is formally introduced, and then cannot be amended under
fast-track rules.
This informal process has a long history. During consideration of
previous trade agreements, the process has lasted months and produced a
host of changes.
[[Page S6755]]
On the Oman agreement, I offered an amendment in the Finance
Committee to prevent products made with slave labor or under sweatshop
conditions so egregious to be tantamount to slave labor from benefiting
from the agreement. I did so because current law has failed to prevent
horrific sweat shops in Jordan under the Jordan FTA. I did so because
it is not free trade when foreign workers are locked in factories and
forced to work 100 hours a week for pennies an hour. That is not free
trade. That is not what Members of this body support when they vote in
favor of free trade.
This story from the New York Times entitled ``An Ugly Side of Free
Trade: Sweat Shops in Jordan'' tells the story. The recent study in
Jordan found that the use of what amounts to slave labor is precisely
what has happened. Workers from Bangladesh, China, and other parts of
Southeast Asia were promised much greater pay than they could earn in
their home countries. They paid hundreds of dollars to recruiters to
get a job in a Jordanian apparel factory. When they got to Jordan,
their passports were taken away so they could not leave or change jobs.
They were then forced to work 90 to 120 hours a week. They were paid
far less than Jordan's minimum wage, and if they complained, they were
beaten or jailed.
Here is what workers reported, according to the news stories:
We used to start at 8 in the morning, and we'd work until
midnight, 1, or 2 a.m, 7 days a week. When we were in
Bangladesh, they promised us we would receive $120 a month,
but in the 5 months I was there in Jordan, I only got 1
month's salary, and that was $50.
Mohammed Saiful Islam, a Bangladeshi, said that several times the
workers had to work until 4 a.m. and then sleep on the factory floor
for a few hours before resuming work at 8 a.m.
The workers got so exhausted they became sick. They could
hardly stay awake at their machines.
Several workers said when they were sick, they did not receive
medical care but were instead punished and had their pay docked.
Hazrat Ali said he sometimes worked 48 hours in a row--48 hours in a
row--and received no pay for 6 months. ``If we asked for money, they
hit us,'' he said.
Nasima Akhter said the western factory gave its workers a half glass
of tea for breakfast and often rice and some rotten chicken for lunch.
``In the 4 months I was in Jordan,'' he said, ``they didn't pay us a
single penny. When we asked management for our money and for better
food, they were very angry at us. We were put in some sort of jail for
4 days without anything to eat, and then they forced us to go back to
Bangladesh.''
Mr. President, these conditions are appalling. We should not be
asking American workers to compete with these practices, and we should
not be giving special trade benefits to products made under these
conditions.
In the case of Oman, its labor laws fall far short of the core
International Labor Organization standards. Oman, like Jordan, relies
heavily on guest workers who are often at a serious disadvantage in
trying to assert their rights. Oman has been cited by our own State
Department for human trafficking. According to the International Trade
Commission, the Oman Free Trade Agreement is expected to greatly
increase apparel production and exports to the United States.
This means there are significant reasons to be concerned about the
same thing that happened in Jordan. There is good reason to be
concerned that they might happen in Oman as well.
That is why I offered the amendment in the Finance Committee. It
simply clarified that goods produced with slave labor or de facto slave
labor will not get the benefits of the agreement. The administration
raised objections in the committee, but the committee rejected the
organization's advice and unanimously adopted my amendment--
unanimously. It did so because the members of the committee believed
that products manufactured in these sorts of abusive conditions should
not get special benefits under this trade agreement.
The Finance Committee spoke loudly and clearly. By an 18-to-nothing
recorded vote, the committee disagreed with the administration and said
that we needed to add protections in this agreement because, clearly,
local labor laws and U.S. laws did not work in the case of Jordan. Yet
the bill before us today does not include these protections. It does
not include my amendment.
This process says that a unanimous vote in the Senate Finance
Committee means nothing. It says that adopting an amendment by a
unanimous vote is tantamount to rejecting the amendment because the
outcome is exactly the same. This makes a complete mockery of the
markup system for trade legislation in the Finance Committee. It
demonstrates how completely broken this process is. No matter what the
Finance Committee says, no matter how strongly it says it, the
administration is free to ignore it.
Two years ago we debated the Australia Free Trade Agreement and the
Finance Committee adopted an amendment I offered at that time. It then
went through procedural contortions to drop the amendment. I said at
the time:
This precedent strikes me as dangerous. It opens the
process for abuse, and it reduces the committee's role in
crafting trade policy and trade legislation. It may have been
expedient, but I believe we will come to regret this
precedent. It invites a future President to ignore any
recommendations made by the committee on future trade
implementing legislation.
Mr. President, that is what has happened here today on the Oman Free
Trade Agreement. The administration has concluded that it is free to
ignore the unanimous recommendation of the Finance Committee.
I believe this action has serious consequences for the fast-track
process itself. If consultation is without meaning, there is no reason
Senators should give up their rights under Senate rules to amend and
debate trade agreements.
Fast track is up for renewal next year. This egregious abuse of the
process is just another nail in the coffin of fast track. It is
becoming crystal clear to me that consultation promised in the fast-
track process is completely a sham.
Let me conclude. The Oman Free Trade Agreement promises few, if any,
benefits to the U.S. economy and will make our trade deficit with Oman
worse. Moreover, the safeguards that were supposed to protect against
imports made under abusive sweatshop conditions and slave labor have
been dropped from the bill.
Finally, the process that the Finance Committee followed sets a
terrible precedent. No Senator should welcome the precedent that the
administration can simply ignore the will of the Finance Committee on a
particular trade issue very important to the people we represent,
secure in the knowledge that a trade implementing bill can be pushed
through as part of a larger take-it-or-leave-it package.
So I hope my colleagues, even those who generally support free-trade
agreements, will think long and hard about this vote. If you believe
the Senate and the Finance Committee should not have a voice in trade
agreements and trade implementing bills, if you support the use of
slave labor and human trafficking and egregious, abusive sweatshops,
you should vote for this bill. But if you believe that consultation
under fast track should be meaningful, if you believe that the markup
process should not be a mockery, and if you oppose slave labor, you
should oppose this bill.
I urge my colleagues to stand for a new direction in trade policy, to
stand for agreements that benefit America and to vote against the Oman
Free Trade Agreement.
I thank the Chair, and I yield the floor.
Mr. HATCH. Mr. President, the Senator makes some good points, but I
don't think we should saddle Oman with what happened in Jordan.
Saddling this agreement with that accusation, it seems to me, is not
quite fair.
Mr. President, whenever I begin my examination and analysis of a
proposed free-trade agreement, my first question is always: How will
this agreement affect my folks, my people in Utah?
Any objective analysis would indicate that the passage of the United
States-Oman Free Trade Agreement will have only a de minimis effect on
the State of Utah, since Oman only has a gross domestic product of
$24.8 billion.
The second question I ask is whether an agreement will have a
positive effect on the American economy. According to the U.S.
International Trade
[[Page S6756]]
Commission, the FTA will have a small, but it will be a positive,
impact.
Specifically, trade between our two nations totaled over $1 billion
in 2005, with the U.S. exporting $593 million worth of goods and
services to Oman and importing $555 million from that country. This is
a trade surplus for us of $38 million, which is a positive development,
since our Nation bore a $48 million trade deficit with Oman as recently
as 2004. Yet despite this positive trade balance, trade with Oman only
accounts for 0.04 percent of all U.S. trade.
So what is the advantage for the American people and the people of
Utah?
The United States-Oman Free Trade Agreement, as does the Bahrain FTA
that preceded it, sends a very important message that the United States
strongly supports the economic development of moderate Middle Eastern
nations. This is a vital message in the global war on terrorism.
As you well know, since the end of the Second World War, the United
States has, on a number of occasions, accepted nonreciprocal trade
concessions in order to further important Cold War and post-Cold War
foreign policy objectives. Examples include offering Japan and Europe
nonreciprocal access to American markets during the 1950s and 1960s in
order to strengthen the economies of our allies and prevent the spread
of communism. At the time, this policy was affordable due to the
tremendous size of the trade surpluses the United States enjoyed.
However, those times have passed.
Our Nation has not enjoyed a trade surplus since 1975, and last
year's deficit widened to a record $726 billion, increasing to 5.8
percent of the gross domestic product, from 5.3 percent in 2004 and 4.5
percent in 2003.
My colleagues may look at these hard truths and question the need for
any further trade agreements, including the United States-Oman Free
Trade Agreement. But I must remind my colleagues that we have a trade
surplus with Oman and this agreement will permit more American
companies to have full access to the Omani market.
Further, Oman is quickly running out of oil and, as a result, has
launched a series of measures to reform its economy. Those measures
will require American products, and this free-trade agreement
immediately removes Oman's uniform tariff of 5 percent ad valorem on
U.S. goods and phases out other tariffs on U.S. goods. Now, this means
that the Omanis will have more money to buy what they are buying from
us now: machinery, transportation equipment, and measuring
instruments--products that provide good jobs for our fellow Americans.
I have also become aware of media reports that state the agreement
provides Omani port operators an absolute right to establish or acquire
operations to run port facilities within the United States. This, of
course, is not accurate. The Oman FTA preserves the right of the United
States to determine for itself whether to block a foreign investment in
the United States in order to protect our essential security interests,
including any potential investment in port authorities and activities.
I also should point out this agreement does not affect current U.S. law
that authorizes the President to block proposed foreign investment in
the United States that threatens U.S. national security.
Mr. President, these Middle Eastern nations such as Oman are
countries who work with us in the global war on terrorism. They are
people who have taken care of our troops. They are people who help us
with our military. They are people who are moderate in nature, and, for
the most part, do a lot of good things and have a constructive view of
the world. Therefore, I think a free-trade agreement with Oman is very
important.
I also want to thank the vast majority of the people of the United
Arab Emirates for the friendship they have shown to our country and,
really, to the world at large.
Therefore, Mr. President, I will continue to support such agreements
as the United States-Oman Free Trade Agreement, and I urge all of our
colleagues to join us in supporting this agreement. Let's not give too
much credibility to some of these arguments that are being made against
this agreement.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Alexander). The Senator from New Jersey.
Mr. LAUTENBERG. Mr. President, I ask to be permitted to speak as in
morning business for up to 10 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
Israel and the Palestinians
Mr. LAUTENBERG. Mr. President, I rise now to discuss the tense
situation we are witnessing in the Middle East between Israel and the
Palestinians. It has been said that governing is about choices. Right
now, Hamas has to make a choice that can determine the future of the
Palestinian people and the Palestinian state.
Hamas is, at its roots, a terrorist organization. That has been
established in the view of the United States and in the view of the
European Union. So we can't kid ourselves about what it is that we see
in front of us. They used a strategy to usurp power in the Palestinian
territories. First, Hamas offered some social services among the
Palestinian people by running social service programs even as it
pursued its terrorist objective, to destroy Israel.
But now Hamas has a choice. Does it really care about the Palestinian
people or is it simply too dedicated to its terrorist ways? If Hamas is
really concerned about the Palestinian people, they would release,
promptly and safely, the Israeli soldier they now hold hostage. We have
seen them brag--crow about the fact that they killed a young settler
they abducted, 18 years of age.
We see a new tactic being used by terrorists over the last few
weeks--by terrorists in general. We saw what happened in Iraq when they
kidnapped two of our soldiers, Private Kristian Menchaca and Private
Thomas Tucker. They were mutilated and tortured before they were
killed. So brutally handled by these terrorists in Iraq. I know our
troops are working very hard to find these terrorist killers, and I
hope we will.
But now Hamas, replicating that kind of terror behavior, has
kidnapped an Israeli soldier, a young corporal--Gilad Shallit his name
is--and Israel has been on the search to try to rescue him while trying
to get the Palestinian people to understand they cannot win this fight
for peace with a government composed of terrorism advocates.
Hamas shows their hand choosing this confrontation. To make matters
worse, they then abducted this young man, 18-year-old Eliyahu Asheri--
they showed pictures of him--and shot him in the head.
The events of these past few days are vividly illustrating to the
world that Hamas is not a valid governing body. They can't be taken
seriously as a civilized leader of its people. That has to be
understood by the people in those communities. There is so much to be
gained by a peaceful resolution of the differences. No, it is probably
true that neither side can fully gain all of its own interests. But
Hamas, a terrorist organization, cannot be taken seriously as a
civilized leader of its people. It is a terrorist organization
masquerading as a government.
But now they are faced with a critical choice. If they have decided
that the path of violence is the one that they would like to follow, it
dooms the Palestinian people to isolation and economic hardship. Or now
they can make a humanitarian gesture on behalf of the people they
purport to represent.
I have had a deep interest in the area. Israel is a very important
ally. They provide us with a degree of presence that we otherwise would
have to gain ourselves with more ships, more troops, more airplanes.
But this democratic society survives in a sea of totalitarianism.
It has to be understood that we want to work with the Palestinian
people. Believe me, when I see pictures of Iraqi children or
Palestinian children, families torn apart, a father or mother lost with
a child weeping, sobbing alongside the dead parent, brother or sister,
we don't want any violence to come to any side in these attempts to
govern. But Hamas is a terrorist organization. Suggesting that they
represent the view of the people there presents a very sad picture.
Violence is not helping any cause in the Middle East. But Hamas seems
intent on continuing the downward spiral of violence and death. One
cannot blame the Israelis for fighting to save
[[Page S6757]]
their people. That is their responsibility as a government.
We have reached out to Iraq, ostensibly, as is said by the
administration, to protect our freedoms in this country. We have come
face to face with terror, and it has changed life in America. The
downing of the World Trade Center and the attack on the Pentagon, the
violation of our territorial borders, the violation of life and the
pursuit of regularity by our people--it is all different now.
I happened to visit a community of Native Americans in New Jersey.
One man was complaining that he can't fish in the reservoir anymore. He
can't put a boat in there because they are afraid that he might be a
terrorist. But they still depend on that for sustenance, hunting
animals, fishing. When you see that kind of reach--that is not the most
terrible thing that has happened in our world, but it just tells you
about the extent that terror can inflict punishment on the free world.
So this situation then between Israel and the Palestine territories
really exemplifies what can be. They have this young man captive,
threatening to kill him. My advice is, return him promptly and safely,
and show the real face of the Palestinian people. They are essentially
a hard-working, industrious people who ultimately want to have peace
for their families and a chance for them to exist with a standard of
living that is reasonable.
The United States and the European Union already know Hamas is a
terrorist organization. The rest of the world now knows it, too.
The reach of terror is beyond anything that might have been
anticipated, whether it is an attack in a Japanese subway or a train in
Great Britain or Spain or wherever; everybody is on guard. We are all
looking at how horrible examples of terror are. We are going to see
tense days in Israel and Gaza. My hope, and I think the hope of
everybody who knows anything about the situation, is that Hamas comes
to its senses and quickly releases Corporal Shallit.
Some time ago I was with other Senators on a trip to Iraq. On the way
we stopped in Israel to meet with Prime Minister Sharon when he was in
power. While we were sitting around the table, I and the four other
Senators suddenly saw activity, hustle-bustle in the conference room.
The Prime Minister, Sharon then, looked like he was suddenly deflated.
He slumped in his chair. He said he had bad news. There was a suicide
bombing attack in a port just south of Tel Aviv and 10 people were
killed and many others wounded.
I volunteered for the five of us that we could adjourn the meeting
and permit the Prime Minister to go on and conduct his necessary
function.
He said to me: Senator, when you are the Prime Minister of Israel,
you must continue to function no matter what the circumstances are. And
we will continue our discussions here.
Israel as we know it is going to fight back against terror with every
ounce of energy and blood that it can muster. It is not going to let
the Palestinians or any other terror come into their country and kill
or injure its citizens without paying a terrible price. The price not
only is to the people where the perpetrators come from but the tensions
that spread throughout the world.
Let's hope that Hamas comes to its senses and quickly returns the
young soldier they are holding.
I yield the floor.
The PRESIDING OFFICER. The assistant Democratic leader.
The Hamdan Decision
Mr. DURBIN. Mr. President, we are a nation at war. There is no doubt
that America must devote all of its energy and resources to defeating
terrorism and stopping those who attacked us on 9/11 and would attack
us again.
But we are also a nation of law. No one from the highest ranks in
America to the lowest is above the law--even during a war. That is what
makes America special and in many ways different from other nations.
Today, across the street from where we meet in the Senate, the United
States Supreme Court handed down a decision reminding the Bush
administration that no President is above the law. The Court rejected
the Bush administration's decision to turn its back on treaties and
laws that have served America so well for generations. The Supreme
Court held that the Bush administration must comply with the Uniform
Code of Military Justice and the Geneva Conventions in its treatment of
suspected terrorists.
Why did this matter come before the Supreme Court? Because, with no
input from Congress, the Bush administration set aside our treaty
obligations and agreements and created new rules for detaining,
interrogating, and trying detainees. They claimed that the Congress had
no voice in the matter and the courts had no right to review what this
President decided.
The administration claimed that it could act as legislator,
executive, and judge when it came to the treatment of these prisoners.
But today the Constitution prevailed. The Supreme Court made it clear
that it is Congress's responsibility to make the laws and the
President's responsibility to follow the laws, just as the Constitution
provided.
Our Founding Fathers understood that it is a human and a natural
political reaction for Kings and Presidents and those in power to try
to be more powerful. They warned us.
In writing our Constitution over 200 years ago, they warned us that
we needed to separate power in America so no one branch of Government
would become too powerful. In the Federalist Papers, James Madison, our
fourth President and the primary author of our Constitution, wrote:
The accumulation of all powers, legislative, executive, and
judiciary, in the same hands may justly be pronounced the very
definition of tyranny.
You do not hear the word ``tyranny'' much anymore. It meant a lot to
the men and women who waged the wars and risked their lives in the
great revolution creating this Government.
But the decision of the Supreme Court today is entirely consistent
with that goal in our Constitution, to make certain that no President,
no branch of our Government, becomes so powerful that it isn't held to
check by our Constitution and our laws.
Today, the Supreme Court ruled against the Bush administration and
for James Madison and for the rule of law. Here is what Justice Anthony
Kennedy said:
Concentration of power (in the executive branch) puts
personal liberty in peril of arbitrary action by officials,
an incursion the Constitution's three-part system is designed
to avoid.
This is a historic decision--a decision that reminds this President
and every President to come that they must answer first to the
Constitution of the United States. It says to President Bush and all of
those who promulgated these policies that they must answer to our
Constitution.
The Supreme Court has taken the same position that former Secretary
of State Colin Powell took almost 5 years ago when the President and
his administration first decided to set aside the standards and values
of the Geneva Conventions. The Geneva Conventions, of course, were
agreements entered into by civilized nations which said we should guide
our conduct by common principles. The Geneva Conventions applied until
this administration after
9/11 felt we could no longer hold to those standards. They were
reminded today by the U.S. Supreme Court that they were wrong.
Secretary of State Colin Powell suggested we could live up to the
Geneva Conventions and still fight terrorism and still make America
safe. He pointed out that the Geneva Conventions do not limit the
ability to hold detainees and do not give POW status to terrorists.
That was a straw man created by this administration to avoid
generations of legal precedents.
Secretary Powell also said that setting aside the Geneva Conventions
``will reverse over a century of U.S. policy and practice . . . and
undermine the protections of the law of war for our own troops . . . It
will undermine public support among critical allies, making military
cooperation more difficult to sustain.''
These are the words of Colin Powell, a man who dedicated his life to
our military, to our country, and to public service.
When you look at the negative publicity about Guantanamo and Abu
Ghraib today, you understand that Collin Powell's remarks were
prophetic. He was right. Ignoring the law of war hurts our efforts to
fight terrorism, and sadly it puts our troops at risk. And it is not
the American way.
Unfortunately, the President did not follow Secretary Collin Powell's
counsel when it came to this decision. He
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listened to others within his administration. That led to this
confrontation before the Supreme Court. That led to this decision
today.
I hope this decision will set a standard for us when it comes to
dealing with this war on terrorism--that we can win this war without
losing our souls. The Supreme Court reminded us today that America--
this great and strong Nation--can be a safe nation without compromising
the values that make us different.
I urge the President to use today's decision to move on a bipartisan
basis to establish a standard consistent with our values, consistent
with our laws, and consistent with the treaties that we have signed for
the treatment of prisoners.
Anyone who is dangerous to America should be held and should not be
released. Anyone who has real value to America, in terms of
intelligence, should be interrogated properly to find out what they
know and how it could help protect us. But the Supreme Court makes it
clear today that we have to move beyond where we are holding hundreds
of prisoners at Guantanamo and other places without charges and without
any clear disposition under the law.
Several of my friends have volunteered to be attorneys for those who
are detained at Guantanamo. I have met with my friends in Chicago. They
are men who have spent a lifetime in the practice of law, one a former
U.S. Attorney for the Northern District of Illinois, another a defense
counsel for many decades in the city of Chicago.
They went down to Guantanamo to meet with the detainees that they
volunteered to represent and came back to Chicago begging me for a
meeting. We got together and they told me the stories. First, they
couldn't understand how this could happen, how the United States of
America would not be following basic standards of conduct, which
everyone assumed we would follow when it came to legal procedure. They
asked me how this could happen. I couldn't answer it, but I knew the
Supreme Court would have to answer it.
When Chief Justice Roberts, who recused himself from today's
decision, and Justice Alito came before the Judiciary Committee, we
reminded them that Sandra Day O'Connor, in an earlier decision
concerning the treatment of prisoners, made it clear that even during
time of war no President is above the law. In the Hamdi decision, she
said, ``A state of war is not a blank check for the President.'' We
asked each of these nominees if they agreed, and they said they did,
without any equivocation.
The decision today by the Supreme Court, this majority decision, is a
reminder of the greatness of this Nation. It is a reminder that
following the rule of law we can keep America safe. We can treat these
prisoners properly and legally. If they are a danger, we can hold them.
But there comes a time when this President and every President must be
held accountable to our Constitution.
Mr. McCAIN. Mr. President, I strongly support the United States-Oman
Free Trade Agreement and urge my colleagues to support this
legislation.
Two-way trade between the U.S. and Oman stands at nearly $1 billion,
and it is projected to grow under the terms of this new agreement. Upon
enactment, 100 percent of industrial and commercial products and 87
percent of agricultural products will be duty free. The agreement,
which covers textiles, telecommunications, intellectual property
rights, investment, and other sectors, will promote economic growth and
prosperity in both countries. American producers, consumers, and
investors will benefit from the FTA.
Not only is this free-trade agreement good for the economic
prosperity of Americans, it will promote growth and employment in Oman.
Given Oman's long strategic ties to the United States and the efforts
of Sultan Qaboos to reform the economy and the political process, this
agreement is an important sign of our support.
Since 1833, when the United States signed a treaty of friendship with
Oman, our ties to that country have been close. The U.S. used Oman's
Masirah Island air base during the attempt to rescue U.S. Embassy
hostages in Iran during the Carter administration. Oman hosted
thousands of U.S. personnel during Operation Enduring Freedom in
Afghanistan and during Operation Iraqi Freedom. Our governments have
cooperated in the nonsecurity aspects of the war on terror, and Oman
has made important strides toward greater democratization. The Sultan
has made women's rights an important part of his reform plans. While
work remains, the liberalization project in Oman remains on a positive
trajectory.
In recognition of this deep cooperation, and to further enhance our
economic and security ties, this free-trade agreement should win quick
approval by the U.S. Senate. I urge my colleagues to support it
Mr. LEVIN. Mr. President, we have a failed trade policy and the
United States-Oman Free Trade Agreement, OFTA, implementation
legislation the Senate is being asked to consider today is a
continuation of that failed trade policy. This failure is reflected in
a trade deficit that reached a record $717 billion last year and in the
loss of 2.8 million manufacturing jobs over the past 5 years.
The OFTA implementing legislation fails to insist on basic
internationally recognized labor standards, yet this agreement is being
rushed through the Senate under fast-track procedures that only allow
Members of Congress an up-or-down vote and no chance to amend or
improve it one day after it was voted out of the Finance Committee and
with no report. Although I support free and fair trade, as well as
increasing our economic ties with Oman, I believe any trade agreement
entered into by the United States should include commitments to
international labor standards.
Writing labor and environmental standards into trade agreements is an
important way to ensure that free trade is fair trade. But unlike the
2001 Jordan Free Trade Agreement, the OFTA fails to include
internationally recognized, core labor standards supported by most
countries in the world. Those standards include the right to organize/
associate; the right to bargain collectively; a prohibition on child
labor; a prohibition on discrimination in employment; and a prohibition
on forced labor.
In the case of Oman, its laws do not meet core International Labor
Organization, ILO, standards, and therefore the agreement's requirement
that Oman simply ``enforce its own laws'' is inadequate.
Rejecting the OFTA implementing legislation as currently drafted
would be a sound rejection of the failed and flawed trade policies of
the past and a signal of support for a better approach to trade that is
a two-way street and trade that supports the rights of workers.
I am disappointed that the administration ignored the Senate Finance
Committee amendment forbidding any goods produced with slave labor or
benefiting from human trafficking from benefiting from the agreement.
This amendment passed the committee unanimously, yet the administration
did not include it in the legislation it sent to Congress. This is
especially unfortunate in light of recent revelations that such labor
abuses are occurring in Jordan despite a United States-Jordan FTA that
included labor and environmental protections unlike the agreement under
consideration today. It also shows a blatant disregard on the part of
the administration of the advice and input of Congress in developing
trade agreements.
I do not support the agreement before us as crafted, and without the
chance to improve it, I must oppose it. Trade should not be a race to
the bottom in which U.S. workers must compete with countries that do
not recognize core international labor standards and basic worker
rights.
Mr. LUGAR. Mr. President, I rise today to speak in support of the
U.S.-Oman Free Trade Agreement. At a time when commerce routinely
crosses national borders, the United States should be positioned to
compete in all arenas. Bilateral free trade agreements facilitate this
goal. The FTA with Oman is significant for many reasons. Foremost, it
encourages trade and economic cooperation with a friend and partner in
the Middle East. FTAs are vital tools in providing new opportunities
for our domestic companies as well as shaping our international
business and foreign policy. Cooperation on the commercial front
enhances our ability
[[Page S6759]]
to work with nations in other matters, including security and
intelligence.
FTAs promote trade and growth which in turn support overall
government stability and cooperation in this region. Continued cross-
border trade ties will ensure the emergence of new capital markets and
provide U.S. firms with new business partners. This agreement with Oman
is also a further step in the direction of the goal to have a Middle
East Free Trade Area by 2013.
Oman acceded to the World Trade Organization in 2000, and entered
into a Trade and Investment Framework Agreement, TIFA, with the U.S. in
July 2004. The TIFA provided a foundation upon which the U.S. and Oman
were able to begin discussing areas of increased cooperation in trade
that could be achieved. Subsequently, this FTA was signed in October
2005 and sent to Congress on June 26 under Trade Promotion Authority
timelines.
This agreement will provide for greater market access in services,
consistent legal protections for investors, effective enforcement of
labor and environmental laws, and protection of intellectual property.
There has been some debate over strengthening of labor laws in Oman.
The government there passed significant labor reforms in 2003 and has
made a commitment to implement further reforms by October of this year.
Additionally, the Omani government has committed to increased
protections for intellectual property. It has indicated that existing
intellectual property protection laws will be enforced and enhanced
civil and criminal penalties will be instituted for violators of these
protections. Further, in addition to commitments not to relax
environmental standards in order to attract investment, there was a
separate agreement signed establishing a Joint Forum on Environmental
Cooperation, through which ongoing assessments of environmental issues
will be addressed.
In 2004, U.S. goods exports to Oman totaled $330 million, and two-way
trade was $748 million. Of these amounts, U.S. agriculture comprised
$20 million. The stock of U.S. foreign direct investment in Oman in
2003 was $358 million. Enactment of this agreement will further expand
the market for U.S. exports which currently include machinery,
automobiles, medical instruments, and agricultural products such as
vegetable oils, sugars, sweeteners, and beverage bases. In addition to
greater market access for agriculture and consumer goods, this
agreement will also specifically create greater opportunities for
service industries such as banking, insurance and securities.
FTAs provide benefits that enable American companies and workers to
compete effectively around the world. I encourage my colleagues to
support the U.S.-Oman FTA.
Mrs. BOXER. Mr. President, I oppose the proposed U.S.-Oman Free Trade
Agreement. This agreement is not fair to American workers, plain and
simple.
The theory behind free trade agreements is that two nations will
agree to the free flow of goods as long as there is a relatively even
playing field in terms of labor and environmental standards.
Without that even playing field, we face a worldwide ``race to the
bottom,'' where the nations that pay their workers the least and offer
them the fewest rights and protections, wins.
Sadly, the Bush administration has entered this particular race with
gusto.
The Sultanate of Oman does not have much of a track record on
worker's rights. There is no right to form independent unions or
bargain collectively. The Omani constitution and labor laws do not
prohibit the use of forced labor for public services and child labor is
still permitted in law and practice.
The country of Oman has only 3 million people--and half a million of
them are foreign ``guest workers,'' mainly from Bangladesh, Sri Lanka
and other Asian countries. And there have been numerous reports about
how guest workers in that region have been exploited and underpaid,
enabling their employers to turn out extremely low-cost products.
Unfortunately the trade agreement we are considering today offers no
guarantees that Oman will not treat its ``guestworkers'' in the same
way, and then be able to sell the products of their labor, duty free,
to U.S. companies.
And we are asking American workers to compete against that? That's
not free trade, defined as a mutually beneficial arrangement between
two nations that raises living standards and general prosperity for the
citizens of both countries. That's merely pitting American workers
against the poorest, most desperate workers in the world, who work as
foreign contract workers and have few legal or institutional
protections.
I cannot support that approach to free trade. I proudly join with
400-plus labor, environmental, religious, human rights, consumer,
business and family farm organizations, to oppose the U.S.-Oman Free
Trade Agreement.
Mr. OBAMA. Mr. President, the Oman Free Trade Agreement is not a
threat to American workers, and it could help us build better relations
in the Middle East. I believe that the administration has handled its
relationship with Congress on this agreement poorly, but our foreign
policy interests in the region require greater engagement with it. For
this reason, I am voting for this agreement.
The economics of the agreement are negligible. U.S. exports entering
Oman today face tariffs that this agreement will remove. As a result,
American sales to that country will increase by about 14 percent, or
$41 million. This increase is a very small share of U.S. exports to the
world--less than .05 percent--making the effect on U.S. output and
employment minimal. On the import side, according to the International
Trade Commission, ``the expected changes in U.S. trade with Oman . . .
would likely be very small and, therefore, have almost no effect on
U.S. imports, employment, or welfare.'' In other words, imports would
be so small that they don't even register.
Because the economic impact on the United States is not a compelling
factor, I believe that we must base our vote on the kind of message it
sends about our approach to trade generally and the potential effects
of trade agreements on our foreign policy. In general, I believe that
more trade between the U.S. and other countries is good. It helps build
constructive political relationships and can create wealth both here
and abroad. And I would like to see us build better relationships with
countries like Oman and its neighbors.
I have been informed by the State Department that Oman has been a
valuable partner for the United States in a volatile part of the world.
I will not take the time to list all of the areas of cooperation
between our two governments, but this relationship is important and is
the main reason I am voting for this agreement today. I believe we have
a strategic interest in working to enhance our relationships with
friendly governments in the region.
I should also point out that Oman, with respect to the Arab world, is
forward leaning on a range of economic and political issues, including
women's suffrage. This is not to gloss over some of the problems in
Oman, including restrictions on the press and a lack of a free and
independent judiciary; one only needs to look at the State Department's
Human Rights Report to know that there is room for improvement. With
this vote, I want to send a signal to the government of Oman that we
respect the progress it is making, but expect that there is much more
to come.
I would caution the administration, however, not to take for granted
Congress' support for trade agreements. We give the President
streamlined authority to negotiate trade agreements and send them to
Congress to make it easier for Presidents to conclude negotiations. We
do that to encourage trade. But that does not mean that he can or
should ignore this co-equal branch of government.
The Senate Finance Committee specifically directed the administration
to exclude from the Oman agreement goods that were produced with slave
labor or benefited from human trafficking. The administration refused
to do so. That sends a loud message to Congress that the administration
believes fast track authority is the authority to ignore Congress. It
is not, and I caution the President that such an approach to trade
policy will lead to the death of Trade Promotion Authority and a wave
of protectionist policies.
I support this agreement because I believe in the potential of the
Middle East and our responsibility to engage and build partnerships in
the region.
[[Page S6760]]
But I will continue to work to make trade agreements better for workers
and the environment as we move forward with the Nation's trade agenda.
Mr. KOHL. Mr. President, I rise today to express my opposition to the
Oman Free Trade Agreement implementing legislation before us. I am
concerned about shortcomings in Oman's labor laws, in particular the
lack of any provisions allowing workers to form independent unions or
to bargain collectively. Also, Oman has no legal prohibitions of
sweatshop labor.
Some have argued during today's debate that Oman has made
improvements in their labor laws and are willing to make more. And it
is true that recent labor law reforms in that country have moved the
situation for workers from criminal to just terrible. But we should
have learned from our experience with Jordan--a country with which we
have a free-trade agreement, one that was justified by promised
improvements in their labor laws. Just recently, the New York Times
published an expose of the dreadful conditions in Jordan's sweatshops.
What makes us think that Oman, with weaker labor standards than Jordan,
will behave any better after they get their free-trade agreement?
Congress needs to stand up for the workers in countries with which we
trade before we reward them with unfettered access to our markets--and
that means Congress must reject against trade agreements that do not
demand strong labor laws and respect for fundamental workers' rights.
My ``no'' vote on the Oman Free Trade Agreement is also a vote
against the way in which the Bush administration has handled trade
negotiations. A year ago, Congress debated and ratified CAFTA. I voted
against CAFTA because I could not see offering trade concessions to
countries with labor standards so far below our own. I challenged this
administration to negotiate trade agreements with countries that have
strong labor laws. So far, they have not responded.
I also voted against CAFTA--and will vote against the Oman agreement
today--in protest of a trade policy that is ignoring our rising trade
deficit and the job drain that accompanies it. Instead of finding ways
to pander to countries with deplorable human rights and worker
protection records, the President and his trade negotiators ought to
get tough with China and make them play by the rules. In the past 8
months, the President has met with President Hu of China twice. Each
meeting was seen as an opportunity to begin to develop policies to
respond to China's unfair trade practices, and each time this
administration has been eerily silent.
In the meantime, our trade deficit has ballooned to $805 billion, and
our trade deficit with China alone has risen to $201 billion. What is
the President's plan? The U.S. Trade Representative wants to push
through as many trade agreements as it can before fast-track
Presidential trade negotiating authority expires in 2007. Peru,
Columbia, United Arab Emirates, Thailand, and Korea are all in the
queue. When is enough, enough? When will this administration focus on
keeping jobs at home rather than handing out trade concessions abroad?
Workers in this country are looking to the President for leadership
and answers on how we can keep jobs in the United States.
Unfortunately, the Oman Free Trade Agreement offers neither. I urge my
colleagues to reject the Oman Free Trade Agreement--and reject the
misguided, disastrous trade policy it represents.
Mr. KERRY. Mr. President, today the Senate is considering a free-
trade agreement with Oman. And here we are, once again, facing a free-
trade agreement with an important ally that is the product of a failed
process, an inattentive administration, and a basic neglect of the will
of Congress.
I think this is a decent agreement with Oman, and I am not interested
in harming relations with an important Middle East ally because of my
frustration with the administration. Economic integration of the Middle
East is too critically important a goal and vital to our efforts in the
war on terror. I understand that deficiencies remain in this agreement.
I will monitor Oman's remaining commitments on worker rights very
closely. We must continue to engage this volatile region of the world
economically if we expect to make progress on a number of fronts.
I have said repeatedly to the administration that our trade
agreements must include the basic International Labor Organization,
ILO, standards within the four corners of the trade agreement and that
those standards must be enforceable. I have said that we must address
other abuses such as the recent reports of abhorrent working conditions
in Jordan. So what have we done? On CAFTA, I offered an amendment
calling on the administration to require equivalent dispute resolution
procedures for workers' rights as we provide for patent violations. And
even though that vote failed on a 10 to 10 tie, the administration did
not even consider strengthening the standards.
On Oman, Senators Conrad, Bingaman and I offered an amendment to
strengthen slave labor laws. The committee adopted the amendment
unanimously. Inexplicably, the administration has returned the
implementing bill without the language--without an explanation--without
justification. It is absolutely inconceivable that the administration
would not support a ban on the importation of goods produced with slave
labor. At a time when America is attempting to restore its image around
the world, this certainly sends the signal that as long as this
administration is in place, we should not anticipate common sense in
Government.
But I will say that the intransigence demonstrated by the
administration this week does not bode well for renewal of fast-track
authority. Under the Constitution, Congress is empowered to manage our
economic relationships. We grant that power to the administration so
that we may present the world with one voice in our economic diplomacy.
But we must evaluate under what conditions we grant this authority in
the future--if we grant it at all. There is no doubt that the system is
broken. And I will be actively engaged as we reevaluate this strategy.
Mr. LIEBERMAN. Mr. President, consistent with my longstanding record
of supporting trade as good for America's economy and economic
development in Arab and Muslim countries as important for peace in the
world, I am supporting the Oman Free Trade Agreement. However, I do so
with some reluctance because of my concerns about its labor provisions.
For me, trade must be fair. This agreement is flawed in its failure
to provide the tools necessary to ensure rigorous labor protections. I
have been pressing for some time for the inclusion of stronger labor
protections in our trade agreements. While the agreement would bind
Oman to enforce its own laws regarding slave labor, I am disturbed by
the administration's decision to ignore the bipartisan views of the
Finance Committee by not including a unanimously approved stronger
provision against slave labor.
Serious labor violations now occurring in Jordan, despite the
stronger labor provisions contained in the Jordan FTA, demand that this
administration insist on stronger labor protections in our trade
agreements and stronger enforcement of the labor protections that do
exist.
I will vote for this FTA because Oman is a strategically important
nation in the Middle East, with which we enjoy excellent relations. The
failure of Congress to pass this agreement would threaten our future
relations with Oman and our allies in the Middle East generally. I will
also support this FTA because trade helps to open the economies of
countries in the Arab world and provides a better path up for its
people than the fanaticism and violence al-Qaida offers. In that sense,
these trade agreements represent progress in the war for the hearts and
minds of the people in the Arab world which is a critical part of our
larger war against Islamist terrorism.
But today I want to lay down a marker. I will not continue to support
future free-trade agreements unless the administration becomes serious
about negotiating labor and other improvement that build on our
experience rather than continue to produce a series of FTAs that in the
end penalize too many of our workers here at home and do not adequately
protect workers overseas.
[[Page S6761]]
Mr. GRASSLEY. Mr. President, I want to respond to some of the points
made by my colleagues today.
First, I have heard concerns that the United States-Oman Free Trade
Agreement will give foreign port operators an absolute right to
establish or acquire operations to run port facilities in the United
States. As I explained earlier, that is just wrong. The United States
clearly has the right to prohibit foreign investments in the United
States that would harm our national security. Nothing in the United
States-Oman Free Trade Agreement changes that.
Some of my colleagues have also expressed concerns about the process
by which the bill we are considering was brought to the Senate floor.
They focus on a proposed amendment adopted by the Finance Committee
during its informal consideration of proposed legislation to implement
our trade agreement with Oman. This amendment was offered by Senator
Conrad. It was meant to withhold benefits under the agreement to
products made with the benefit of forced or indentured labor. I voted
for the amendment because I shared some of Senator Conrad's concerns,
and I subsequently transmitted the text of the adopted amendment to the
U.S. Trade Representative.
In addition to voting for the Conrad amendment, I introduced a
chairman's modification to the proposed statement of administrative
action which was approved by the committee. My modification called upon
the administration to monitor or report on the efforts of the
Government of Oman to prohibit compulsory or coerced labor.
Separately, the House Ways and Means Committee had approved the same
draft implementing legislation but without approving any amendments. So
we had a situation where the Finance Committee and the Ways and Means
Committee sent different versions of informal nonbinding
recommendations to the President. In this case the differences were
limited and discrete. They were not of the type and degree that would
warrant a mock conference.
The administration made the determination that existing law already
precluded the legal importation of products made with forced or
indentured labor. The administration therefore concluded that the
Conrad amendment was not necessary or appropriate to implementation of
the agreement. I received a letter from the general counsel of the
Office of U.S. Trade Representative articulating the legal basis for
the administration's position. I distributed this letter to all members
of the Finance Committee prior to the committee's formal markup of this
implementing legislation. I will ask unanimous consent that this letter
be included in the record with my remarks.
I understand that some of my colleagues are upset that the proposed
Conrad amendment isn't included in S. 3569. I believe that the process
concerns raised by my colleagues could have been avoided if we had had
more consultations by the U.S. Trade Representative with members of the
Finance Committee. I am going to make it a point to see that there is
better dialogue between the Finance Committee and the U.S. Trade
Representative in the future. I want to see improved dialogue both
during the negotiation of a trade agreements and prior to the point
that the administration sends implementing legislation for a trade
agreement to the Congress. I am confident that improved consultation
and communication will help avoid such process concerns in the future.
With that, Mr. President, I say again that this is a very good trade
agreement for both Oman and the United States. I urge my colleagues to
lend their enthusiastic support to the bill before the Senate to
implement this agreement.
I ask unanimous consent that the letter to which I referred be
printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Executive Office of the President, the United States
Trade Representative,
Washington, DC, June 22, 2006.
Hon. Charles Grassley,
Chairman, Senate Finance Committee,
Washington, DC.
Dear Chairman Grassley: During the Finance Committee
hearing on May 18, Senator Conrad introduced an addition to
the draft implementing legislation for the United States-Oman
Free Trade Agreement (FTA) to ``add a provision to prevent
goods made with slave labor (including conditions of de facto
indentured servitude), or with the benefit of human
trafficking, from benefiting from the agreement.'' At the
hearing, I promised to provide you with a letter detailing
our views on this proposal.
The proposed addition is neither necessary nor appropriate
because the FTA already deals effectively with products of
forced or indentured labor. In addition, U.S. law prohibits
the importation of products produced with convict, forced, or
indentured labor under penal sanctions. Moreover, we are
aware of no evidence suggesting that goods are produced in
Oman using slave labor or with the benefit of human
trafficking.
First, Oman already prohibits forced labor and Oman has
promised to take steps to clarify and strengthen its laws
further. Article 12 of Oman's Basic Law provides that ``Every
citizen has the right to engage the work of his choice within
the limits of the law. It is not permitted to impose any
compulsory work on anyone except in accordance with the Law
and for the performance of public service, for a fair wage.''
Oman has further committed in writing to ``issue a Royal
Decree, no later than October 31, 2006, specifying the forms
of public service that could be required in the event the
Government were ever to exercise its power under Article 12,
consistent with Convention 29.'' Oman is, in fact, already a
signatory to ILO Conventions 29 and 105, which prohibit
forced labor. At your request; the Administration has
committed to update the Congress periodically on the progress
that Oman achieves in realizing all its commitments made to
labor law reform.
Second, Article 16.2.1(a) of the FTA requires Oman to
enforce its labor laws. If it fails to do so, then the United
States is entitled to resort to the FTA's dispute settlement
procedures, and if the United States prevails, Oman may be
required to pay up to $15 million per year in fines that can
be used for appropriate labor initiatives in Oman, including
enforcement.
Third, U.S. law already prohibits the importation of
products produced with convict labor, forced labor, and
indentured labor under penal sanctions. Specifically, 19
U.S.C. 1307 states as follows:
All goods, wares, articles, and merchandise mined,
produced, or manufactured wholly or in part in any foreign
country by convict labor or/and forced labor or/and
indentured labor under penal sanctions shall not be entitled
to entry at any of the ports of the United States, and the
importation thereof is hereby prohibited, and the Secretary
of the Treasury is authorized and directed to prescribe such
regulations as may be necessary for the enforcement of this
provision. The provisions of this section relating to goods,
wares, articles, and merchandise mined, produced, or
manufactured by forced labor or/and indentured labor, shall
take effect on January 1, 1932; but in no case shall such
provisions be applicable to goods, wares, articles, or
merchandise so mined, produced, or manufactured which are not
mined, produced, or manufactured in such quantities in the
United States as to meet the consumptive demands of the
United States.
``Forced labor'', as herein used, shall mean work or
service which is exacted from any person under the menace of
any penalty for its nonperformance and for which the worker
does not offer himself voluntarily. For purposes of this
section, the team ``forced labor or/and indentured labor''
includes forced or indentured child labor.
Notably, the statute is not limited to prison labor, but
extends to products manufactured with forced or indentured
labor. In fact, the statute was specifically amended in 1930
to add forced and indentured labor.
The statute is also not limited to involuntary labor. The
term ``indentured labor'' is understood to mean labor
undertaken pursuant to a `` `contract entered into by an
employee the enforcement of which can be accompanied by
process or penalties.' '' China Diesel Imports, Inc. v.
United States, 855 F. Supp. 380, 384 (CIT 1994) (citing 71
Cong. Rec. 4489 (1929) (statement of Senator Blaine)).
While the statute provides for an exception in the case of
goods that are not produced in the United States, we cannot
envision a situation where this exception would be applied in
practice. Given the broad economic base of the United States,
we do not anticipate a situation where the United States
would be obliged to import an otherwise banned product from
Oman to satisfy domestic demand because it cannot be obtained
in the United States.
In determining whether importation of a product should be
prohibited, Customs will look closely at the circumstances of
the case. For example, the Forced Child Labor Advisory issued
by the Department of Treasury and U.S. Customs Service in
December 2000 lists several ``red flag'' factors indicating
the existence of forced or indentured child labor. These red
flags may alone provide evidence of forced/indentured labor,
and include, e.g., slave labor conditions, employment to
discharge a debt, financial penalties that eliminate wages,
etc. The Advisory also lists several ``yellow flag'' factors
that may indicate the need for further investigation. These
yellow flag factors include, for example, employment in
violation of local laws and regulations, or employment in
hazardous industries or under extreme conditions.
Other agencies have interpreted the statute in a similar
way. Pursuant to Executive
[[Page S6762]]
Order 13126, the Department of Labor applies the Section 1307
standard in developing a list of products produced by child
labor that are not eligible for federal government
procurement. According to the Department of Labor, ``The
essential elements of the definition [of forced or indentured
child labor] are either the presence of coercion or the
existence of a contract enforceable by penalties.'' The
Department has listed illustrative factors it will look at in
making this determination, including, e.g., confinement,
little or no pay, deprivation of basic needs, etc. Bureau of
International Labor Affairs; Notice of Preliminary List of
Products Requiring Federal Contractor Certification as to
Forced or Indentured Labor Under Executive Order No. 13126;
Request for Comments, 65 Fed. Reg. 54108 (Sept. 6, 2000).
Fourth, Congress recently affirmed that goods made with
forced or child labor in violation of international standards
cannot be imported into the United States. On February 17,
2005, the President signed into law the Trafficking Victims
Protection Reauthorization Act of 2005 (P.L. 109-164).
Specifically, section 105(b) of that Act requires United
States Government departments and agencies to ``consult with
other departments and agencies of the United States
Government to reduce forced and child labor internationally
and ensure that products made by forced labor and child labor
in violation of international standards are not imported into
the United States.''
For these reasons, the Administration does not consider the
proposed addition to be ``necessary or appropriate to
implement'' the Oman-trade agreement under the terms of 19
USC Sec. 3803(b)(3)(B)(ii) and the Administration will not
include the proposed addition in the text of the legislation
implementing the United States--Oman Free Trade Agreement.
Sincerely,
James E. Mendenhall,
General Counsel.
Mr. REID. Mr. President, I rise to express my deep disappointment
over the legislation to implement the U.S.-Oman Free Trade Agreement.
When sending this legislation to Congress, President Bush inexplicably
deleted an amendment that would have barred goods made with slave labor
or forced labor from benefiting under the FTA.
This amendment was originally proposed by Senator Conrad and other
Democrats on the Finance Committee, but ultimately received unanimous
bipartisan support from the Finance Committee in a recorded vote.
The amendment was very simple it would have ensured that goods
produced with slave labor, goods produced from forced labor, and goods
produced based on human trafficking could not come into the U.S. under
the preferential rules established by the agreement. I do not know how
anyone could oppose this amendment. I think the American public would
be united in support for the concept that they do not want to help
support slave labor, forced labor, and human trafficking. President
Bush really has some explaining to do.
The genesis for this amendment was a report revealing that companies
in Jordan were importing workers from Bangladesh, Pakistan, and other
poor countries, confiscating their passports, forcing them to work 80
to 100 hours per week, paying them inadequately, if at all, and
subjecting them to physical intimidation and in some cases violence.
Many of these workers actually paid recruiters thousands of dollars to
get these ``good jobs'' and could not leave until they had earned
enough money to pay off their debts.
Admittedly, these problems were in Jordan, not Oman. There are
important reasons, however, why we need to be even more vigilant about
this type of problem in Oman.
First, Oman's basic economic structure is currently based on the use
of foreign workers--about 70 percent of Oman's workforce is foreign.
Pretty much anywhere in the world, foreign workers are a particularly
vulnerable lot.
Second, Oman already has a record on related issues that is cause for
concern the International Confederation of Free Trade Unions has stated
that migrant workers ``suffered extreme exploitation'' in Oman. And,
the U.S. State Department has criticized Oman for inadequate efforts to
stop human trafficking:
Oman is a destination country for men and women primarily
from Pakistan, Bangladesh, and India who migrate willingly,
but may subsequently become victims of trafficking when
subjected to conditions of involuntary servitude . . . as . .
. laborers. Oman is placed on Tier 2 Watch List because of a
lack of evidence of increasing efforts to combat severe forms
of trafficking in persons over the last year.
Third, Oman's labor laws, enforcement, and history are much weaker
than Jordan's. Oman's labor laws do not currently meet basic
international standards. Oman is to be applauded for making numerous
changes to its laws in the run up to the FTA to try to improve them.
And, it has committed to making additional changes. Still, as I
understand it, a few important areas remain where Oman's laws and
enforcement fall short of standards that virtually every country in the
world has accepted as a minimum.
Negotiations with some Democrats had been ongoing to resolve the
continuing labor issues, but the administration appears to have decided
that it will ignore their concerns. That was a regrettable decision. I
have heard a lot of people lament the decline of bipartisanship in
trade policy. I think if you were to date this decline, it would have
started in 2001. The administration cannot just roll Democratic
concerns one day and then expect a great working environment the next.
I am not sure why President Bush thinks we need excuses to ban goods
made from slave labor and forced labor, but if we do, then I think I
have just outlined a pretty good rationale.
I have heard some argue that we do not need to ban goods made with
slave labor from Oman because U.S. law already bans all goods made with
slave labor. People who make this argument are either misinformed or
being misleading. The law at issue unfortunately has a ``consumptive
demand'' exception--it does not block imports of products made with
slave labor if there is not sufficient U.S. production to meet U.S.
demand. The Court of International Trade just last year confirmed that
the consumptive demand exception applies. Given that our trade deficit
stands at over $700 billion, the exception clearly swallows the rule.
So, again, anyone making a defense of this indefensible position by
pointing to existing law is just plain wrong.
The President's decision to undermine Senate Democrats' efforts to
curb slave labor and forced labor is not the only reason that I oppose
this bill. As I noted above, Oman's labor laws--while much improved
from 3 years ago--are still not up to international norms. The Bush
administration has steadfastly refused to incorporate these minimum
standards into the text of the agreement itself. There are minimum
standards for intellectual property, for protecting the rights of
foreign investors, for certain regulatory decisions, and in numerous
other areas--as there should be. But the Bush administration has
refused to include minimum standards for workers.
Finally, I want to restate my serious concerns about the Arab League
Boycott against Israel. For decades now, the United States has had a
policy to oppose the Arab League boycott against Israel. There is an
entire office in the Department of Commerce tasked with implementing
this anti-boycott policy. Congress has also directed USTR to
``vigorously oppose'' WTO admission for countries that engage in the
boycott. In my view, it is an implicit corollary of this latter rule
that the U.S. should not enter into bilateral trade agreements with
countries that participate in the boycott.
Here, Oman has traditionally been one of the good guys. It renounced
the boycott--primary, secondary, and tertiary--in 1994. The Government
of Oman has stated numerous times that it does not apply any aspect of
the boycott.
So, it was confusing to say the least that the Jerusalem Post
reported earlier this month that an interview with two separate senior
Customs officials in Oman revealed that Oman does in fact enforce the
primary boycott. An official from Oman's Directorate of Customs stated,
``Products from Israel are not permitted because of the boycott. . . .
You might put yourself in problems if you do that [i.e., if you try to
bring in products from Israel].'' The chief of Customs Officers at the
capitol airport stated, ``No products from Israel are allowed.''
The Government of Oman quickly sought to correct the record. I again
applaud these efforts. Still, it certainly raises a serious question
when you have nonpolitical people with no agenda whose very job it is
day in and day out to enforce the Oman customs law claiming that the
boycott exists. There seems to be a major disconnect here.
[[Page S6763]]
The administration should be able to lift the cloud of confusion, but
unfortunately, the administration lacks credibility on this issue.
Unwittingly or not, USTR has helped obfuscate the issue by giving
incomplete, inaccurate, and on occasion misleading information to
Congress on the boycott. In light of this lack of credibility, there is
too much uncertainty on whether Oman has indeed terminated all aspects
of the Arab League boycott. Accordingly, until this uncertainty is
cleared up, I cannot support giving Oman the most preferential trade
treatment under U.S. law.
I yield the floor. I 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. FRIST. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
Mr. FRIST. Mr. President, in a few minutes, we will be voting on the
United States-Oman Free Trade Agreement
This agreement is a model for free trade in the Persian Gulf region
and will become America's fourth agreement with an Arab country.
We struck similar deals with Jordan in 2000, Morocco in 2004, and
Bahrain in 2005. Like these earlier deals, the Oman agreement will open
and expand opportunities for exports of many American products to the
benefit of America's workers, manufacturers, consumers, farmers,
ranchers, and service providers.
As soon as the agreement takes effect, Oman and the United States
will provide each other immediate duty-free access on virtually all
products in their tariff schedules, including all consumer and
industrial products, and will phase out tariffs on the remaining
products within 10 years.
Former Trade Representative Rob Portman calls it ``a high quality,
comprehensive free trade agreement that will contribute to economic
growth and trade.''
America's relationship with Oman dates back to the early years of our
Republic, when a treaty of friendship and navigation was signed with
Muscat in 1833.
Since then, relations between our two countries have continually
expanded. Today we enjoy a close and cooperative partnership.
Although not a formal member of the coalition, Oman has been a
committed, dependable ally in the global war on terror. Oman has been a
solid partner on terrorist finance issues and has reached out to work
with partner nations in the region on trans-border terror threats.
Oman cooperates closely with us and other allies on counterterrorism
and has publicly supported the democratic transition in Iraq. It has
also supported stabilization operations, and the democratic and
economic transition in Afghanistan. And its government and religious
leaders consistently and courageously denounce acts of terror and
religious intolerance.
Unfortunately, some have sought to undermine the agreement with myths
that do not stand up to the scrutiny of the facts. For example, despite
claims to the contrary, Oman does not implement any aspect of the
boycott of Israel, a position they publicly reaffirmed in a letter from
its commerce minister in September of 2005.
Moreover, Oman does not tolerate or allow the use of slave labor. To
the contrary, Oman has also substantial commitments to the United
States on labor reform and has promised to enact additional reforms by
October 31, 2006.
The agreement before us builds on the progress already made and
strengthens our relationship with a key friend and ally in the region.
Indeed, rejection of the trade agreement would send a strong negative
signal to our friends in the Middle East.
I urge my colleagues to vote for this measure. As the 9/11 Commission
advised, expanding trade with the Middle East will ``encourage
development, more open societies and opportunities for people to
improve the lives of their families.''
Passing the free trade agreement will promote economic reform and
development in the gulf and advance President Bush's broader goal of
freer and more open Middle East. It will help both our allies and
America move forward.
I yield back all time for both sides.
The ACTING PRESIDENT pro tempore. Without objection, all time is
yielded back.
The question is on the engrossment and third reading of the bill.
The bill was ordered to be engrossed for a third reading and was read
the third time.
The ACTING PRESIDENT pro tempore. The bill, having been read the
third time, the question is, Shall the bill pass?
Mr. FRIST. I ask for the yeas and nays.
The ACTING PRESIDENT pro tempore. Is there a sufficient second?
There appears to be a sufficient second.
The clerk will call the roll.
The legislative clerk called the roll
Mr. McCONNELL. The following Senators were necessarily absent: the
Senator from Rhode Island (Mr. Chafee) and the Senator from New
Hampshire (Mr. Gregg).
Mr. DURBIN. I announce that the Senator from California (Mrs. Boxer),
the Senator from Vermont (Mr. Leahy), the Senator from Washington (Mrs.
Murray), and the Senator from Michigan (Ms. Stabenow) are necessarily
absent.
I further announce that, if present and voting, the Senator from
Vermont (Mr. Leahy) and the Senator from Michigan (Ms. Stabenow) would
each vote ``nay.''
The PRESIDING OFFICER (Mr. Alexander). Are there any other Senators
in the Chamber desiring to vote?
The result was announced--yeas 60, nays 34, as follows:
[Rollcall Vote No. 190 Leg.]
YEAS--60
Alexander
Allard
Allen
Baucus
Bennett
Bond
Brownback
Bunning
Burns
Cantwell
Chambliss
Clinton
Cochran
Coleman
Cornyn
Craig
Crapo
DeMint
DeWine
Domenici
Ensign
Enzi
Frist
Graham
Grassley
Hagel
Hatch
Hutchison
Inhofe
Isakson
Jeffords
Kerry
Kyl
Landrieu
Lieberman
Lott
Lugar
Martinez
McCain
McConnell
Murkowski
Nelson (FL)
Nelson (NE)
Obama
Pryor
Roberts
Salazar
Santorum
Sessions
Shelby
Smith
Specter
Stevens
Sununu
Talent
Thomas
Thune
Vitter
Voinovich
Warner
NAYS--34
Akaka
Bayh
Biden
Bingaman
Burr
Byrd
Carper
Coburn
Collins
Conrad
Dayton
Dodd
Dole
Dorgan
Durbin
Feingold
Feinstein
Harkin
Inouye
Johnson
Kennedy
Kohl
Lautenberg
Levin
Lincoln
Menendez
Mikulski
Reed
Reid
Rockefeller
Sarbanes
Schumer
Snowe
Wyden
NOT VOTING--6
Boxer
Chafee
Gregg
Leahy
Murray
Stabenow
The bill (S. 3569) was passed, as follows:
S. 3569
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``United
States-Oman Free Trade Agreement Implementation Act''.
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Purposes.
Sec. 3. Definitions.
TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT
Sec. 101. Approval and entry into force of the Agreement.
Sec. 102. Relationship of the Agreement to United States and State law.
Sec. 103. Implementing actions in anticipation of entry into force and
initial regulations.
Sec. 104. Consultation and layover provisions for, and effective date
of, proclaimed actions.
Sec. 105. Administration of dispute settlement proceedings.
Sec. 106. Arbitration of claims.
Sec. 107. Effective dates; effect of termination.
TITLE II--CUSTOMS PROVISIONS
Sec. 201. Tariff modifications.
Sec. 202. Rules of origin.
Sec. 203. Customs user fees.
Sec. 204. Enforcement relating to trade in textile and apparel goods.
Sec. 205. Reliquidation of entries.
Sec. 206. Regulations.
[[Page S6764]]
TITLE III--RELIEF FROM IMPORTS
Sec. 301. Definitions.
Subtitle A--Relief From Imports Benefiting From the Agreement
Sec. 311. Commencing of action for relief.
Sec. 312. Commission action on petition.
Sec. 313. Provision of relief.
Sec. 314. Termination of relief authority.
Sec. 315. Compensation authority.
Sec. 316. Confidential business information.
Subtitle B--Textile and Apparel Safeguard Measures
Sec. 321. Commencement of action for relief.
Sec. 322. Determination and provision of relief.
Sec. 323. Period of relief.
Sec. 324. Articles exempt from relief.
Sec. 325. Rate after termination of import relief.
Sec. 326. Termination of relief authority.
Sec. 327. Compensation authority.
Sec. 328. Confidential business information.
TITLE IV--PROCUREMENT
Sec. 401. Eligible products.
SEC. 2. PURPOSES.
The purposes of this Act are--
(1) to approve and implement the Free Trade Agreement
between the United States and Oman entered into under the
authority of section 2103(b) of the Bipartisan Trade
Promotion Authority Act of 2002 (19 U.S.C. 3803(b));
(2) to strengthen and develop economic relations between
the United States and Oman for their mutual benefit;
(3) to establish free trade between the 2 nations through
the reduction and elimination of barriers to trade in goods
and services and to investment; and
(4) to lay the foundation for further cooperation to expand
and enhance the benefits of such Agreement.
SEC. 3. DEFINITIONS.
In this Act:
(1) Agreement.--The term ``Agreement'' means the United
States-Oman Free Trade Agreement approved by Congress under
section 101(a)(1).
(2) HTS.--The term ``HTS'' means the Harmonized Tariff
Schedule of the United States.
(3) Textile or apparel good.--The term ``textile or apparel
good'' means a good listed in the Annex to the Agreement on
Textiles and Clothing referred to in section 101(d)(4) of the
Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)).
TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT
SEC. 101. APPROVAL AND ENTRY INTO FORCE OF THE AGREEMENT.
(a) Approval of Agreement and Statement of Administrative
Action.--Pursuant to section 2105 of the Bipartisan Trade
Promotion Authority Act of 2002 (19 U.S.C. 3805) and section
151 of the Trade Act of 1974 (19 U.S.C. 2191), Congress
approves--
(1) the United States-Oman Free Trade Agreement entered
into on January 19, 2006, with Oman and submitted to Congress
on June 26, 2006; and
(2) the statement of administrative action proposed to
implement the Agreement that was submitted to Congress on
June 26, 2006.
(b) Conditions for Entry Into Force of the Agreement.--At
such time as the President determines that Oman has taken
measures necessary to bring it into compliance with those
provisions of the Agreement that are to take effect on the
date on which the Agreement enters into force, the President
is authorized to exchange notes with the Government of Oman
providing for the entry into force, on or after January 1,
2007, of the Agreement with respect to the United States.
SEC. 102. RELATIONSHIP OF THE AGREEMENT TO UNITED STATES AND
STATE LAW.
(a) Relationship of Agreement to United States Law.--
(1) United states law to prevail in conflict.--No provision
of the Agreement, nor the application of any such provision
to any person or circumstance, which is inconsistent with any
law of the United States shall have effect.
(2) Construction.--Nothing in this Act shall be construed--
(A) to amend or modify any law of the United States, or
(B) to limit any authority conferred under any law of the
United States,
unless specifically provided for in this Act.
(b) Relationship of Agreement to State Law.--
(1) Legal challenge.--No State law, or the application
thereof, may be declared invalid as to any person or
circumstance on the ground that the provision or application
is inconsistent with the Agreement, except in an action
brought by the United States for the purpose of declaring
such law or application invalid.
(2) Definition of state law.--For purposes of this
subsection, the term ``State law'' includes--
(A) any law of a political subdivision of a State; and
(B) any State law regulating or taxing the business of
insurance.
(c) Effect of Agreement With Respect to Private Remedies.--
No person other than the United States--
(1) shall have any cause of action or defense under the
Agreement or by virtue of congressional approval thereof; or
(2) may challenge, in any action brought under any
provision of law, any action or inaction by any department,
agency, or other instrumentality of the United States, any
State, or any political subdivision of a State, on the ground
that such action or inaction is inconsistent with the
Agreement.
SEC. 103. IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO
FORCE AND INITIAL REGULATIONS.
(a) Implementing Actions.--
(1) Proclamation authority.--After the date of the
enactment of this Act--
(A) the President may proclaim such actions, and
(B) other appropriate officers of the United States
Government may issue such regulations,
as may be necessary to ensure that any provision of this Act,
or amendment made by this Act, that takes effect on the date
on which the Agreement enters into force is appropriately
implemented on such date, but no such proclamation or
regulation may have an effective date earlier than the date
on which the Agreement enters into force.
(2) Effective date of certain proclaimed actions.--Any
action proclaimed by the President under the authority of
this Act that is not subject to the consultation and layover
provisions under section 104 may not take effect before the
15th day after the date on which the text of the proclamation
is published in the Federal Register.
(3) Waiver of 15-day restriction.--The 15-day restriction
in paragraph (2) on the taking effect of proclaimed actions
is waived to the extent that the application of such
restriction would prevent the taking effect on the date on
which the Agreement enters into force of any action
proclaimed under this section.
(b) Initial Regulations.--Initial regulations necessary or
appropriate to carry out the actions required by or
authorized under this Act or proposed in the statement of
administrative action submitted under section 101(a)(2) to
implement the Agreement shall, to the maximum extent
feasible, be issued within 1 year after the date on which the
Agreement enters into force. In the case of any implementing
action that takes effect on a date after the date on which
the Agreement enters into force, initial regulations to carry
out that action shall, to the maximum extent feasible, be
issued within 1 year after such effective date.
SEC. 104. CONSULTATION AND LAYOVER PROVISIONS FOR, AND
EFFECTIVE DATE OF, PROCLAIMED ACTIONS.
If a provision of this Act provides that the implementation
of an action by the President by proclamation is subject to
the consultation and layover requirements of this section,
such action may be proclaimed only if--
(1) the President has obtained advice regarding the
proposed action from--
(A) the appropriate advisory committees established under
section 135 of the Trade Act of 1974 (19 U.S.C. 2155); and
(B) the United States International Trade Commission;
(2) the President has submitted to the Committee on Finance
of the Senate and the Committee on Ways and Means of the
House of Representatives a report that sets forth--
(A) the action proposed to be proclaimed and the reasons
therefor; and
(B) the advice obtained under paragraph (1);
(3) a period of 60 calendar days, beginning on the first
day on which the requirements set forth in paragraphs (1) and
(2) have been met has expired; and
(4) the President has consulted with the Committees
referred to in paragraph (2) regarding the proposed action
during the period referred to in paragraph (3).
SEC. 105. ADMINISTRATION OF DISPUTE SETTLEMENT PROCEEDINGS.
(a) Establishment or Designation of Office.--The President
is authorized to establish or designate within the Department
of Commerce an office that shall be responsible for providing
administrative assistance to panels established under chapter
20 of the Agreement. The office may not be considered to be
an agency for purposes of section 552 of title 5, United
States Code.
(b) Authorization of Appropriations.--There are authorized
to be appropriated for each fiscal year after fiscal year
2006 to the Department of Commerce such sums as may be
necessary for the establishment and operations of the office
established or designated under subsection (a) and for the
payment of the United States share of the expenses of panels
established under chapter 20 of the Agreement.
SEC. 106. ARBITRATION OF CLAIMS.
The United States is authorized to resolve any claim
against the United States covered by article 10.15.1(a)(i)(C)
or article 10.15.1(b)(i)(C) of the Agreement, pursuant to the
Investor-State Dispute Settlement procedures set forth in
section B of chapter 10 of the Agreement.
SEC. 107. EFFECTIVE DATES; EFFECT OF TERMINATION.
(a) Effective Dates.--Except as provided in subsection (b),
the provisions of this Act and the amendments made by this
Act take effect on the date on which the Agreement enters
into force.
(b) Exceptions.--Sections 1 through 3 and this title take
effect on the date of the enactment of this Act.
(c) Termination of the Agreement.--On the date on which the
Agreement terminates, the provisions of this Act (other than
this subsection) and the amendments made by this Act shall
cease to be effective.
[[Page S6765]]
TITLE II--CUSTOMS PROVISIONS
SEC. 201. TARIFF MODIFICATIONS.
(a) Tariff Modifications Provided for in the Agreement.--
(1) Proclamation authority.--The President may proclaim--
(A) such modifications or continuation of any duty,
(B) such continuation of duty-free or excise treatment, or
(C) such additional duties,
as the President determines to be necessary or appropriate to
carry out or apply articles 2.3, 2.5, 2.6, 3.2.8, and 3.2.9,
and Annex 2-B of the Agreement.
(2) Effect on omani gsp status.--Notwithstanding section
502(a)(1) of the Trade Act of 1974 (19 U.S.C. 2462(a)(1)),
the President shall, on the date on which the Agreement
enters into force, terminate the designation of Oman as a
beneficiary developing country for purposes of title V of the
Trade Act of 1974 (19 U.S.C. 2461 et seq.).
(b) Other Tariff Modifications.--Subject to the
consultation and layover provisions of section 104, the
President may proclaim--
(1) such modifications or continuation of any duty,
(2) such modifications as the United States may agree to
with Oman regarding the staging of any duty treatment set
forth in Annex 2-B of the Agreement,
(3) such continuation of duty-free or excise treatment, or
(4) such additional duties,
as the President determines to be necessary or appropriate to
maintain the general level of reciprocal and mutually
advantageous concessions with respect to Oman provided for by
the Agreement.
(c) Conversion to Ad Valorem Rates.--For purposes of
subsections (a) and (b), with respect to any good for which
the base rate in the Tariff Schedule of the United States to
Annex 2-B of the Agreement is a specific or compound rate of
duty, the President may substitute for the base rate an ad
valorem rate that the President determines to be equivalent
to the base rate.
SEC. 202. RULES OF ORIGIN.
(a) Application and Interpretation.--In this section:
(1) Tariff classification.--The basis for any tariff
classification is the HTS.
(2) Reference to hts.--Whenever in this section there is a
reference to a heading or subheading, such reference shall be
a reference to a heading or subheading of the HTS.
(b) Originating Goods.--
(1) In general.--For purposes of this Act and for purposes
of implementing the preferential tariff treatment provided
for under the Agreement, a good is an originating good if--
(A) the good is imported directly--
(i) from the territory of Oman into the territory of the
United States; or
(ii) from the territory of the United States into the
territory of Oman; and
(B)(i) the good is a good wholly the growth, product, or
manufacture of Oman or the United States, or both;
(ii) the good (other than a good to which clause (iii)
applies) is a new or different article of commerce that has
been grown, produced, or manufactured in Oman or the United
States, or both, and meets the requirements of paragraph (2);
or
(iii)(I) the good is a good covered by Annex 3-A or 4-A of
the Agreement;
(II)(aa) each of the nonoriginating materials used in the
production of the good undergoes an applicable change in
tariff classification specified in such Annex as a result of
production occurring entirely in the territory of Oman or the
United States, or both; or
(bb) the good otherwise satisfies the requirements
specified in such Annex; and
(III) the good satisfies all other applicable requirements
of this section.
(2) Requirements.--A good described in paragraph (1)(B)(ii)
is an originating good only if the sum of--
(A) the value of each material produced in the territory of
Oman or the United States, or both, and
(B) the direct costs of processing operations performed in
the territory of Oman or the United States, or both,
is not less than 35 percent of the appraised value of the
good at the time the good is entered into the territory of
the United States.
(c) Cumulation.--
(1) Originating good or material incorporated into goods of
other country.--An originating good, or a material produced
in the territory of Oman or the United States, or both, that
is incorporated into a good in the territory of the other
country shall be considered to originate in the territory of
the other country.
(2) Multiple producers.--A good that is grown, produced, or
manufactured in the territory of Oman or the United States,
or both, by 1 or more producers, is an originating good if
the good satisfies the requirements of subsection (b) and all
other applicable requirements of this section.
(d) Value of Materials.--
(1) In general.--Except as provided in paragraph (2), the
value of a material produced in the territory of Oman or the
United States, or both, includes the following:
(A) The price actually paid or payable for the material by
the producer of the good.
(B) The freight, insurance, packing, and all other costs
incurred in transporting the material to the producer's
plant, if such costs are not included in the price referred
to in subparagraph (A).
(C) The cost of waste or spoilage resulting from the use of
the material in the growth, production, or manufacture of the
good, less the value of recoverable scrap.
(D) Taxes or customs duties imposed on the material by Oman
or the United States, or both, if the taxes or customs duties
are not remitted upon exportation from the territory of Oman
or the United States, as the case may be.
(2) Exception.--If the relationship between the producer of
a good and the seller of a material influenced the price
actually paid or payable for the material, or if there is no
price actually paid or payable by the producer for the
material, the value of the material produced in the territory
of Oman or the United States, or both, includes the
following:
(A) All expenses incurred in the growth, production, or
manufacture of the material, including general expenses.
(B) A reasonable amount for profit.
(C) Freight, insurance, packing, and all other costs
incurred in transporting the material to the producer's
plant.
(e) Packaging and Packing Materials and Containers for
Retail Sale and for Shipment.--Packaging and packing
materials and containers for retail sale and shipment shall
be disregarded in determining whether a good qualifies as an
originating good, except to the extent that the value of such
packaging and packing materials and containers has been
included in meeting the requirements set forth in subsection
(b)(2).
(f) Indirect Materials.--Indirect materials shall be
disregarded in determining whether a good qualifies as an
originating good, except that the cost of such indirect
materials may be included in meeting the requirements set
forth in subsection (b)(2).
(g) Transit and Transshipment.--A good shall not be
considered to meet the requirement of subsection (b)(1)(A)
if, after exportation from the territory of Oman or the
United States, the good undergoes production, manufacturing,
or any other operation outside the territory of Oman or the
United States, other than unloading, reloading, or any other
operation necessary to preserve the good in good condition or
to transport the good to the territory of Oman or the United
States.
(h) Textile and Apparel Goods.--
(1) De minimis amounts of nonoriginating materials.--
(A) In general.--Except as provided in subparagraph (B), a
textile or apparel good that is not an originating good
because certain fibers or yarns used in the production of the
component of the good that determines the tariff
classification of the good do not undergo an applicable
change in tariff classification set out in Annex 3-A of the
Agreement shall be considered to be an originating good if
the total weight of all such fibers or yarns in that
component is not more than 7 percent of the total weight of
that component.
(B) Certain textile or apparel goods.--A textile or apparel
good containing elastomeric yarns in the component of the
good that determines the tariff classification of the good
shall be considered to be an originating good only if such
yarns are wholly formed in the territory of Oman or the
United States.
(C) Yarn, fabric, or group of fibers.--For purposes of this
paragraph, in the case of a textile or apparel good that is a
yarn, fabric, or group of fibers, the term ``component of the
good that determines the tariff classification of the good''
means all of the fibers in the yarn, fabric, or group of
fibers.
(2) Goods put up in sets for retail sale.--Notwithstanding
the rules set forth in Annex 3-A of the Agreement, textile or
apparel goods classifiable as goods put up in sets for retail
sale as provided for in General Rule of Interpretation 3 of
the HTS shall not be considered to be originating goods
unless each of the goods in the set is an originating good or
the total value of the nonoriginating goods in the set does
not exceed 10 percent of the value of the set determined for
purposes of assessing customs duties.
(i) Definitions.--In this section:
(1) Direct costs of processing operations.--
(A) In general.--The term ``direct costs of processing
operations'', with respect to a good, includes, to the extent
they are includable in the appraised value of the good when
imported into Oman or the United States, as the case may be,
the following:
(i) All actual labor costs involved in the growth,
production, or manufacture of the good, including fringe
benefits, on-the-job training, and the cost of engineering,
supervisory, quality control, and similar personnel.
(ii) Tools, dies, molds, and other indirect materials, and
depreciation on machinery and equipment that are allocable to
the good.
(iii) Research, development, design, engineering, and
blueprint costs, to the extent that they are allocable to the
good.
(iv) Costs of inspecting and testing the good.
(v) Costs of packaging the good for export to the territory
of the other country.
(B) Exceptions.--The term ``direct costs of processing
operations'' does not include costs that are not directly
attributable to a good or are not costs of growth,
production, or manufacture of the good, such as--
(i) profit; and
(ii) general expenses of doing business that are either not
allocable to the good or are not related to the growth,
production, or
[[Page S6766]]
manufacture of the good, such as administrative salaries,
casualty and liability insurance, advertising, and sales
staff salaries, commissions, or expenses.
(2) Good.--The term ``good'' means any merchandise,
product, article, or material.
(3) Good wholly the growth, product, or manufacture of oman
or the united states, or both.--The term ``good wholly the
growth, product, or manufacture of Oman or the United States,
or both'' means--
(A) a mineral good extracted in the territory of Oman or
the United States, or both;
(B) a vegetable good, as such a good is provided for in the
HTS, harvested in the territory of Oman or the United States,
or both;
(C) a live animal born and raised in the territory of Oman
or the United States, or both;
(D) a good obtained from live animals raised in the
territory of Oman or the United States, or both;
(E) a good obtained from hunting, trapping, or fishing in
the territory of Oman or the United States, or both;
(F) a good (fish, shellfish, and other marine life) taken
from the sea by vessels registered or recorded with Oman or
the United States and flying the flag of that country;
(G) a good produced from goods referred to in subparagraph
(F) on board factory ships registered or recorded with Oman
or the United States and flying the flag of that country;
(H) a good taken by Oman or the United States or a person
of Oman or the United States from the seabed or beneath the
seabed outside territorial waters, if Oman or the United
States, as the case may be, has rights to exploit such
seabed;
(I) a good taken from outer space, if such good is obtained
by Oman or the United States or a person of Oman or the
United States and not processed in the territory of a country
other than Oman or the United States;
(J) waste and scrap derived from--
(i) production or manufacture in the territory of Oman or
the United States, or both; or
(ii) used goods collected in the territory of Oman or the
United States, or both, if such goods are fit only for the
recovery of raw materials;
(K) a recovered good derived in the territory of Oman or
the United States from used goods and utilized in the
territory of that country in the production of remanufactured
goods; and
(L) a good produced in the territory of Oman or the United
States, or both, exclusively--
(i) from goods referred to in subparagraphs (A) through
(J), or
(ii) from the derivatives of goods referred to in clause
(i),
at any stage of production.
(4) Indirect material.--The term ``indirect material''
means a good used in the growth, production, manufacture,
testing, or inspection of a good but not physically
incorporated into the good, or a good used in the maintenance
of buildings or the operation of equipment associated with
the growth, production, or manufacture of a good, including--
(A) fuel and energy;
(B) tools, dies, and molds;
(C) spare parts and materials used in the maintenance of
equipment and buildings;
(D) lubricants, greases, compounding materials, and other
materials used in the growth, production, or manufacture of a
good or used to operate equipment and buildings;
(E) gloves, glasses, footwear, clothing, safety equipment,
and supplies;
(F) equipment, devices, and supplies used for testing or
inspecting the good;
(G) catalysts and solvents; and
(H) any other goods that are not incorporated into the good
but the use of which in the growth, production, or
manufacture of the good can reasonably be demonstrated to be
a part of that growth, production, or manufacture.
(5) Material.--The term ``material'' means a good,
including a part or ingredient, that is used in the growth,
production, or manufacture of another good that is a new or
different article of commerce that has been grown, produced,
or manufactured in Oman or the United States, or both.
(6) Material produced in the territory of oman or the
united states, or both.--The term ``material produced in the
territory of Oman or the United States, or both'' means a
good that is either wholly the growth, product, or
manufacture of Oman or the United States, or both, or a new
or different article of commerce that has been grown,
produced, or manufactured in the territory of Oman or the
United States, or both.
(7) New or different article of commerce.--
(A) In general.--The term ``new or different article of
commerce'' means, except as provided in subparagraph (B), a
good that--
(i) has been substantially transformed from a good or
material that is not wholly the growth, product, or
manufacture of Oman or the United States, or both; and
(ii) has a new name, character, or use distinct from the
good or material from which it was transformed.
(B) Exception.--A good shall not be considered a new or
different article of commerce by virtue of having undergone
simple combining or packaging operations, or mere dilution
with water or another substance that does not materially
alter the characteristics of the good.
(8) Recovered goods.--The term ``recovered goods'' means
materials in the form of individual parts that result from--
(A) the disassembly of used goods into individual parts;
and
(B) the cleaning, inspecting, testing, or other processing
of those parts as necessary for improvement to sound working
condition.
(9) Remanufactured good.--The term ``remanufactured good''
means an industrial good that is assembled in the territory
of Oman or the United States and that--
(A) is entirely or partially comprised of recovered goods;
(B) has a similar life expectancy to a like good that is
new; and
(C) enjoys a factory warranty similar to that of a like
good that is new.
(10) Simple combining or packaging operations.--The term
``simple combining or packaging operations'' means operations
such as adding batteries to devices, fitting together a small
number of components by bolting, gluing, or soldering, and
repacking or packaging components together.
(11) Substantially transformed.--The term ``substantially
transformed'' means, with respect to a good or material,
changed as the result of a manufacturing or processing
operation so that--
(A)(i) the good or material is converted from a good that
has multiple uses into a good or material that has limited
uses;
(ii) the physical properties of the good or material are
changed to a significant extent; or
(iii) the operation undergone by the good or material is
complex by reason of the number of different processes and
materials involved and the time and level of skill required
to perform those processes; and
(B) the good or material loses its separate identity in the
manufacturing or processing operation.
(j) Presidential Proclamation Authority.--
(1) In general.--The President is authorized to proclaim,
as part of the HTS--
(A) the provisions set forth in Annex 3-A and Annex 4-A of
the Agreement; and
(B) any additional subordinate category that is necessary
to carry out this title, consistent with the Agreement.
(2) Modifications.--
(A) In general.--Subject to the consultation and layover
provisions of section 104, the President may proclaim
modifications to the provisions proclaimed under the
authority of paragraph (1)(A), other than provisions of
chapters 50 through 63 of the HTS (as included in Annex 3-A
of the Agreement).
(B) Additional proclamations.--Notwithstanding subparagraph
(A), and subject to the consultation and layover provisions
of section 104, the President may proclaim--
(i) modifications to the provisions proclaimed under the
authority of paragraph (1)(A) as are necessary to implement
an agreement with Oman pursuant to article 3.2.5 of the
Agreement; and
(ii) before the end of the 1-year period beginning on the
date of the enactment of this Act, modifications to correct
any typographical, clerical, or other nonsubstantive
technical error regarding the provisions of chapters 50
through 63 of the HTS (as included in Annex 3-A of the
Agreement).
SEC. 203. CUSTOMS USER FEES.
Section 13031(b) of the Consolidated Omnibus Budget
Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is amended by
adding after paragraph (16) the following:
``(17) No fee may be charged under subsection (a) (9) or
(10) with respect to goods that qualify as originating goods
under section 202 of the United States-Oman Free Trade
Agreement Implementation Act. Any service for which an
exemption from such fee is provided by reason of this
paragraph may not be funded with money contained in the
Customs User Fee Account.''.
SEC. 204. ENFORCEMENT RELATING TO TRADE IN TEXTILE AND
APPAREL GOODS.
(a) Action During Verification.--
(1) In general.--If the Secretary of the Treasury requests
the Government of Oman to conduct a verification pursuant to
article 3.3 of the Agreement for purposes of making a
determination under paragraph (2), the President may direct
the Secretary to take appropriate action described in
subsection (b) while the verification is being conducted.
(2) Determination.--A determination under this paragraph is
a determination--
(A) that an exporter or producer in Oman is complying with
applicable customs laws, regulations, procedures,
requirements, or practices affecting trade in textile or
apparel goods; or
(B) that a claim that a textile or apparel good exported or
produced by such exporter or producer--
(i) qualifies as an originating good under section 202, or
(ii) is a good of Oman,
is accurate.
(b) Appropriate Action Described.--Appropriate action under
subsection (a)(1) includes--
(1) suspension of liquidation of the entry of any textile
or apparel good exported or produced by the person that is
the subject of a verification referred to in subsection
(a)(1) regarding compliance described in subsection
(a)(2)(A), in a case in which the request for verification
was based on a reasonable suspicion of unlawful activity
related to such good; and
[[Page S6767]]
(2) suspension of liquidation of the entry of a textile or
apparel good for which a claim has been made that is the
subject of a verification referred to in subsection (a)(1)
regarding a claim described in subsection (a)(2)(B).
(c) Action When Information Is Insufficient.--If the
Secretary of the Treasury determines that the information
obtained within 12 months after making a request for a
verification under subsection (a)(1) is insufficient to make
a determination under subsection (a)(2), the President may
direct the Secretary to take appropriate action described in
subsection (d) until such time as the Secretary receives
information sufficient to make a determination under
subsection (a)(2) or until such earlier date as the President
may direct.
(d) Appropriate Action Described.--Appropriate action
referred to in subsection (c) includes--
(1) publication of the name and address of the person that
is the subject of the verification;
(2) denial of preferential tariff treatment under the
Agreement to--
(A) any textile or apparel good exported or produced by the
person that is the subject of a verification referred to in
subsection (a)(1) regarding compliance described in
subsection (a)(2)(A); or
(B) a textile or apparel good for which a claim has been
made that is the subject of a verification referred to in
subsection (a)(1) regarding a claim described in subsection
(a)(2)(B); and
(3) denial of entry into the United States of--
(A) any textile or apparel good exported or produced by the
person that is the subject of a verification referred to in
subsection (a)(1) regarding compliance described in
subsection (a)(2)(A); or
(B) a textile or apparel good for which a claim has been
made that is the subject of a verification referred to in
subsection (a)(1) regarding a claim described in subsection
(a)(2)(B).
SEC. 205. RELIQUIDATION OF ENTRIES.
Subsection (d) of section 520 of the Tariff Act of 1930 (19
U.S.C. 1520(d)) is amended--
(1) in the matter preceding paragraph (1)--
(A) by striking ``or''; and
(B) by striking ``for which'' and inserting ``, or section
202 of the United States-Oman Free Trade Agreement
Implementation Act for which''; and
(2) in paragraph (3), by inserting ``and information''
after ``documentation''.
SEC. 206. REGULATIONS.
The Secretary of the Treasury shall prescribe such
regulations as may be necessary to carry out--
(1) subsections (a) through (i) of section 202;
(2) the amendment made by section 203; and
(3) proclamations issued under section 202(j).
TITLE III--RELIEF FROM IMPORTS
SEC. 301. DEFINITIONS.
In this title:
(1) Omani article.--The term ``Omani article'' means an
article that--
(A) qualifies as an originating good under section 202(b);
or
(B) receives preferential tariff treatment under paragraphs
8 through 11 of article 3.2 of the Agreement.
(2) Omani textile or apparel article.--The term ``Omani
textile or apparel article'' means an article that--
(A) is listed in the Annex to the Agreement on Textiles and
Clothing referred to in section 101(d)(4) of the Uruguay
Round Agreements Act (19 U.S.C. 3511(d)(4)); and
(B) is an Omani article.
(3) Commission.--The term ``Commission'' means the United
States International Trade Commission.
Subtitle A--Relief From Imports Benefiting From the Agreement
SEC. 311. COMMENCING OF ACTION FOR RELIEF.
(a) Filing of Petition.--A petition requesting action under
this subtitle for the purpose of adjusting to the obligations
of the United States under the Agreement may be filed with
the Commission by an entity, including a trade association,
firm, certified or recognized union, or group of workers,
that is representative of an industry. The Commission shall
transmit a copy of any petition filed under this subsection
to the United States Trade Representative.
(b) Investigation and Determination.--Upon the filing of a
petition under subsection (a), the Commission, unless
subsection (d) applies, shall promptly initiate an
investigation to determine whether, as a result of the
reduction or elimination of a duty provided for under the
Agreement, an Omani article is being imported into the United
States in such increased quantities, in absolute terms or
relative to domestic production, and under such conditions
that imports of the Omani article constitute a substantial
cause of serious injury or threat thereof to the domestic
industry producing an article that is like, or directly
competitive with, the imported article.
(c) Applicable Provisions.--The following provisions of
section 202 of the Trade Act of 1974 (19 U.S.C. 2252) apply
with respect to any investigation initiated under subsection
(b):
(1) Paragraphs (1)(B) and (3) of subsection (b).
(2) Subsection (c).
(3) Subsection (i).
(d) Articles Exempt From Investigation.--No investigation
may be initiated under this section with respect to any Omani
article if, after the date on which the Agreement enters into
force with respect to the United States, import relief has
been provided with respect to that Omani article under this
subtitle.
SEC. 312. COMMISSION ACTION ON PETITION.
(a) Determination.--Not later than 120 days after the date
on which an investigation is initiated under section 311(b)
with respect to a petition, the Commission shall make the
determination required under that section.
(b) Applicable Provisions.--For purposes of this subtitle,
the provisions of paragraphs (1), (2), and (3) of section
330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d) (1), (2),
and (3)) shall be applied with respect to determinations and
findings made under this section as if such determinations
and findings were made under section 202 of the Trade Act of
1974 (19 U.S.C. 2252).
(c) Additional Finding and Recommendation if Determination
Affirmative.--
(1) In general.--If the determination made by the
Commission under subsection (a) with respect to imports of an
article is affirmative, or if the President may consider a
determination of the Commission to be an affirmative
determination as provided for under paragraph (1) of section
330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d)), the
Commission shall find, and recommend to the President in the
report required under subsection (d), the amount of import
relief that is necessary to remedy or prevent the injury
found by the Commission in the determination and to
facilitate the efforts of the domestic industry to make a
positive adjustment to import competition.
(2) Limitation on relief.--The import relief recommended by
the Commission under this subsection shall be limited to that
described in section 313(c).
(3) Voting; separate views.--Only those members of the
Commission who voted in the affirmative under subsection (a)
are eligible to vote on the proposed action to remedy or
prevent the injury found by the Commission. Members of the
Commission who did not vote in the affirmative may submit, in
the report required under subsection (d), separate views
regarding what action, if any, should be taken to remedy or
prevent the injury.
(d) Report to President.--Not later than the date that is
30 days after the date on which a determination is made under
subsection (a) with respect to an investigation, the
Commission shall submit to the President a report that
includes--
(1) the determination made under subsection (a) and an
explanation of the basis for the determination;
(2) if the determination under subsection (a) is
affirmative, any findings and recommendations for import
relief made under subsection (c) and an explanation of the
basis for each recommendation; and
(3) any dissenting or separate views by members of the
Commission regarding the determination and recommendation
referred to in paragraphs (1) and (2).
(e) Public Notice.--Upon submitting a report to the
President under subsection (d), the Commission shall promptly
make public such report (with the exception of information
which the Commission determines to be confidential) and shall
cause a summary thereof to be published in the Federal
Register.
SEC. 313. PROVISION OF RELIEF.
(a) In General.--Not later than the date that is 30 days
after the date on which the President receives the report of
the Commission in which the Commission's determination under
section 312(a) is affirmative, or which contains a
determination under section 312(a) that the President
considers to be affirmative under paragraph (1) of section
330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d)(1)), the
President, subject to subsection (b), shall provide relief
from imports of the article that is the subject of such
determination to the extent that the President determines
necessary to remedy or prevent the injury found by the
Commission and to facilitate the efforts of the domestic
industry to make a positive adjustment to import competition.
(b) Exception.--The President is not required to provide
import relief under this section if the President determines
that the provision of the import relief will not provide
greater economic and social benefits than costs.
(c) Nature of Relief.--
(1) In general.--The import relief that the President is
authorized to provide under this section with respect to
imports of an article is as follows:
(A) The suspension of any further reduction provided for
under Annex 2-B of the Agreement in the duty imposed on such
article.
(B) An increase in the rate of duty imposed on such article
to a level that does not exceed the lesser of--
(i) the column 1 general rate of duty imposed under the HTS
on like articles at the time the import relief is provided;
or
(ii) the column 1 general rate of duty imposed under the
HTS on like articles on the day before the date on which the
Agreement enters into force.
(2) Progressive liberalization.--If the period for which
import relief is provided under this section is greater than
1 year, the President shall provide for the progressive
liberalization of such relief at regular intervals during the
period in which the relief is in effect.
[[Page S6768]]
(d) Period of Relief.--
(1) In general.--Subject to paragraph (2), any import
relief that the President provides under this section may
not, in the aggregate, be in effect for more than 3 years.
(2) Extension.--
(A) In general.--If the initial period for any import
relief provided under this section is less than 3 years, the
President, after receiving a determination from the
Commission under subparagraph (B) that is affirmative, or
which the President considers to be affirmative under
paragraph (1) of section 330(d) of the Tariff Act of 1930 (19
U.S.C. 1330(d)(1)), may extend the effective period of any
import relief provided under this section, subject to the
limitation under paragraph (1), if the President determines
that--
(i) the import relief continues to be necessary to remedy
or prevent serious injury and to facilitate adjustment by the
domestic industry to import competition; and
(ii) there is evidence that the industry is making a
positive adjustment to import competition.
(B) Action by commission.--
(i) Investigation.--Upon a petition on behalf of the
industry concerned that is filed with the Commission not
earlier than the date which is 9 months, and not later than
the date which is 6 months, before the date any action taken
under subsection (a) is to terminate, the Commission shall
conduct an investigation to determine whether action under
this section continues to be necessary to remedy or prevent
serious injury and to facilitate adjustment by the domestic
industry to import competition and whether there is evidence
that the industry is making a positive adjustment to import
competition.
(ii) Notice and hearing.--The Commission shall publish
notice of the commencement of any proceeding under this
subparagraph in the Federal Register and shall, within a
reasonable time thereafter, hold a public hearing at which
the Commission shall afford interested parties and consumers
an opportunity to be present, to present evidence, and to
respond to the presentations of other parties and consumers,
and otherwise to be heard.
(iii) Report.--The Commission shall transmit to the
President a report on its investigation and determination
under this subparagraph not later than 60 days before the
action under subsection (a) is to terminate, unless the
President specifies a different date.
(e) Rate After Termination of Import Relief.--When import
relief under this section is terminated with respect to an
article, the rate of duty on that article shall be the rate
that would have been in effect, but for the provision of such
relief, on the date on which the relief terminates.
(f) Articles Exempt From Relief.--No import relief may be
provided under this section on any article that has been
subject to import relief under this subtitle after the date
on which the Agreement enters into force.
SEC. 314. TERMINATION OF RELIEF AUTHORITY.
(a) General Rule.--Subject to subsection (b), no import
relief may be provided under this subtitle after the date
that is 10 years after the date on which the Agreement enters
into force.
(b) Presidential Determination.--Import relief may be
provided under this subtitle in the case of an Omani article
after the date on which such relief would, but for this
subsection, terminate under subsection (a), if the President
determines that Oman has consented to such relief.
SEC. 315. COMPENSATION AUTHORITY.
For purposes of section 123 of the Trade Act of 1974 (19
U.S.C. 2133), any import relief provided by the President
under section 313 shall be treated as action taken under
chapter 1 of title II of such Act (19 U.S.C. 2251 et seq.).
SEC. 316. CONFIDENTIAL BUSINESS INFORMATION.
Section 202(a)(8) of the Trade Act of 1974 (19 U.S.C.
2252(a)(8)) is amended in the first sentence--
(1) by striking ``and''; and
(2) by inserting before the period at the end ``, and title
III of the United States-Oman Free Trade Agreement
Implementation Act''.
Subtitle B--Textile and Apparel Safeguard Measures
SEC. 321. COMMENCEMENT OF ACTION FOR RELIEF.
(a) In General.--A request under this subtitle for the
purpose of adjusting to the obligations of the United States
under the Agreement may be filed with the President by an
interested party. Upon the filing of a request, the President
shall review the request to determine, from information
presented in the request, whether to commence consideration
of the request.
(b) Publication of Request.--If the President determines
that the request under subsection (a) provides the
information necessary for the request to be considered, the
President shall cause to be published in the Federal Register
a notice of commencement of consideration of the request, and
notice seeking public comments regarding the request. The
notice shall include a summary of the request and the dates
by which comments and rebuttals must be received.
SEC. 322. DETERMINATION AND PROVISION OF RELIEF.
(a) Determination.--
(1) In general.--If a positive determination is made under
section 321(b), the President shall determine whether, as a
result of the reduction or elimination of a duty under the
Agreement, an Omani textile or apparel article is being
imported into the United States in such increased quantities,
in absolute terms or relative to the domestic market for that
article, and under such conditions as to cause serious
damage, or actual threat thereof, to a domestic industry
producing an article that is like, or directly competitive
with, the imported article.
(2) Serious damage.--In making a determination under
paragraph (1), the President--
(A) shall examine the effect of increased imports on the
domestic industry, as reflected in changes in such relevant
economic factors as output, productivity, utilization of
capacity, inventories, market share, exports, wages,
employment, domestic prices, profits, and investment, none of
which is necessarily decisive; and
(B) shall not consider changes in technology or consumer
preference as factors supporting a determination of serious
damage or actual threat thereof.
(b) Provision of Relief.--
(1) In general.--If a determination under subsection (a) is
affirmative, the President may provide relief from imports of
the article that is the subject of such determination, as
described in paragraph (2), to the extent that the President
determines necessary to remedy or prevent the serious damage
and to facilitate adjustment by the domestic industry to
import competition.
(2) Nature of relief.--The relief that the President is
authorized to provide under this subsection with respect to
imports of an article is an increase in the rate of duty
imposed on the article to a level that does not exceed the
lesser of--
(A) the column 1 general rate of duty imposed under the HTS
on like articles at the time the import relief is provided;
or
(B) the column 1 general rate of duty imposed under the HTS
on like articles on the day before the date on which the
Agreement enters into force.
SEC. 323. PERIOD OF RELIEF.
(a) In General.--Subject to subsection (b), any import
relief that the President provides under subsection (b) of
section 322 may not, in the aggregate, be in effect for more
than 3 years.
(b) Extension.--If the initial period for any import relief
provided under section 322 is less than 3 years, the
President may extend the effective period of any import
relief provided under that section, subject to the limitation
set forth in subsection (a), if the President determines
that--
(1) the import relief continues to be necessary to remedy
or prevent serious damage and to facilitate adjustment by the
domestic industry to import competition; and
(2) there is evidence that the industry is making a
positive adjustment to import competition.
SEC. 324. ARTICLES EXEMPT FROM RELIEF.
The President may not provide import relief under this
subtitle with respect to any article if--
(1) the article has been subject to import relief under
this subtitle after the date on which the Agreement enters
into force; or
(2) the article is subject to import relief under chapter 1
of title II of the Trade Act of 1974 (19 U.S.C. 2251 et
seq.).
SEC. 325. RATE AFTER TERMINATION OF IMPORT RELIEF.
When import relief under this subtitle is terminated with
respect to an article, the rate of duty on that article shall
be the rate that would have been in effect, but for the
provision of such relief, on the date on which the relief
terminates.
SEC. 326. TERMINATION OF RELIEF AUTHORITY.
No import relief may be provided under this subtitle with
respect to any article after the date that is 10 years after
the date on which duties on the article are eliminated
pursuant to the Agreement.
SEC. 327. COMPENSATION AUTHORITY.
For purposes of section 123 of the Trade Act of 1974 (19
U.S.C. 2133), any import relief provided by the President
under this subtitle shall be treated as action taken under
chapter 1 of title II of such Act.
SEC. 328. CONFIDENTIAL BUSINESS INFORMATION.
The President may not release information that is submitted
in a proceeding under this subtitle and that the President
considers to be confidential business information unless the
party submitting the confidential business information had
notice, at the time of submission, that such information
would be released, or such party subsequently consents to the
release of the information. To the extent a party submits
confidential business information to the President in a
proceeding under this subtitle, the party shall also submit a
nonconfidential version of the information, in which the
confidential business information is summarized or, if
necessary, deleted.
TITLE IV--PROCUREMENT
SEC. 401. ELIGIBLE PRODUCTS.
Section 308(4)(A) of the Trade Agreements Act of 1979 (19
U.S.C. 2518(4)(A)) is amended--
(1) by striking ``or'' at the end of clause (iv);
(2) by striking the period at the end of clause (v) and
inserting ``; or''; and
(3) by adding at the end the following new clause:
``(vi) a party to the United States-Oman Free Trade
Agreement, a product or service of that country or
instrumentality which is covered under that Agreement for
procurement by the United States.''.
[[Page S6769]]
Mr. GRASSLEY. With today's passage of S. 3569, the U.S.-Oman Free
Trade Agreement Implementation Act, we have solidified our commercial
relations with Oman, a longstanding friend and ally for over 200 years.
The agreement will result in new economic opportunities for U.S.
farmers, manufacturers, and service providers.
None of this would have been possible without the support of my
colleagues. In particular, the Senator from Montana, ranking Democrat
of the Committee on Finance, Senator Max Baucus. I want to thank
Senator Baucus for his cooperation and good faith in moving this
legislation through the Senate with bipartisan support. We would not be
here today without his strong commitment to raising the living
standards of people in the United States and abroad.
Senator Baucus's trade staff deserves recognition. The Democratic
Staff Director on the Finance Committee, Russ Sullivan, and the Deputy
Staff Director, Bill Dauster, worked well with my staff and provided
helpful insight throughout the process. I also appreciate the efforts
of Brian Pomper, Chief International Trade Counsel, as well as
Demetrios Marantis, Anya Landau, Janis Lazda, and Chelsea Thomas.
I would also like to thank President Bush for his leadership. His
commitment to improving the U.S. economy through increased access to
foreign markets has made this agreement a reality. Oman is just one of
his latest successes on this front.
The dedication of two former United States Trade Representatives,
Robert Zoellick and Rob Portman, merits special thanks. Their efforts
at the negotiating table produced a comprehensive, commercially-
meaningful agreement. I would like to recognize the current United
States Trade Representative, Susan Schwab. Ms. Schwab was confirmed in
her current position after negotiations of the agreement were
concluded. Her consultations with the U.S. Congress are appreciated.
Her negotiating skills and experience make her well suited for future
talks. I also appreciate the service and hard work of Assistant United
States Trade Representative for Europe and the Middle East Shaun
Donnelly.
My trade staff on the Finance Committee deserves recognition. First,
my Chief Counsel and Staff Director, Kolan Davis, merits special
mention. His legislative expertise has been instrumental in moving
countless bills. The work of the Finance Committee's International
Trade Counsel, David Johanson and Stephen Schaefer, is invaluable.
Their depth of knowledge, dedication, and ability to juggle several
policy issues at that same time is key in advancing the Committee's
trade agenda. Their long hours are much appreciated. I would like to
recognize my former Chief International Trade Counsel, Everett
Eissenstat. While on my staff, he worked diligently on this agreement
and others. I want also want to thank Tiffany McCullen Atwell,
International Trade Policy Advisor on the Committee for her hard work
that produces results behind the scenes. Claudia Bridgeford,
International Trade Policy Assistant, has also contributed
significantly to the Committee's work. Russ Ugone, my detailee from
Customs and Border Protection, has lent us his technical expertise.
I am grateful to Justin McCarthy, Assistant United States Trade
Representative for Congressional Affairs, and Andy Olson, Deputy
Assistant United States Trade Representative for Congressional Affairs,
for their work with Congress on the U.S-Oman Free Trade Agreement.
Finally, I would like to thank Polly Craighill of the Office of the
Senate Legislative Counsel for the long hours she put into working on
this legislation. Without her patience and hard work, today's vote
would not have been possible.
I look forward to the signing of this legislation into law by
President Bush.
Mr. CARPER. Mr. President, it is with great disappointment that I
cast a ``nay'' vote on the Oman Free Trade Agreement today.
Last summer, when we were debating the Central America Free Trade
Agreement, or CAFTA, I expressed frustration with the direction of
free-trade agreements and free-trade policy, in general. I expressed a
hope that the administration would do more to consult with Congress
and, particularly, with moderate, free-trade Democrats.
Many times, representatives of this administration have said that
they want to bring back the strong bipartisan support for free-trade
agreements and ``make it easier for Democrats to support free-trade
agreements.'' Well, one of the ways they can do that is by consulting
with and responding to concerns expressed by Democrats and moderates in
Congress--before we are asked to vote up or down on those agreements.
When the Oman Free Trade Agreement was considered in the Finance
Committee, 18 members voted in favor of an amendment offered by Senator
Conrad that would ban the import of goods made by slave labor or by
workers trapped in abusive conditions through human trafficking. And
with that amendment approved, all 19 members of the Finance Committee
were able to support the free-trade agreement. Clearly, supporting that
language was a way to make it easier for Members of Congress to support
this agreement.
Yet the administration decided to ignore that strong signal. They did
not try to address the concerns voiced through the adoption of the
Conrad amendment. They chose to omit the amendment from the
implementing language they sent to the Congress for its approval.
This action may not backfire today: the Oman agreement may still
pass. However, it will backfire one day, and I expect it to be in the
not so distant future.
Next year, Congress will be asked to reauthorize trade promotion
authority. But trade promotion authority is about trust, and the
actions taken by this administration in agreement after agreement have
not inspired trust. And at this point, they have very little time to
reestablish that trust before the vote on trade promotion authority
next summer.
Lowering trade barriers and promoting free trade is about more than
just economics. It is about increasing opportunities and improving
quality of life both here and abroad. In offering access to our
markets, we can help to peacefully spread democracy and encourage
developing countries to increase transparency in government, strengthen
their judiciary, improve conditions for their workforce, and protect
their environment. But this administration does not seem to recognize
this opportunity, even when strong supporters of trade--like myself--
tell them that this is an important part of our support for free-trade
agreements.
So today we have been sent a free-trade agreement that does not
reflect an understanding of the concerns expressed by Members of
Congress. This bill is not amendable. All I can do is vote yes or no.
Last summer I voted yes, giving the administration the benefit of the
doubt and hoping that they would listen to the concerns expressed by
moderates in Congress. Today, I am going to vote no and hope that the
administration will recognize that they must listen to the concerns
expressed by the legislative branch and that they cannot take our votes
for granted.
I invite the administration to use the time between now and the
consideration of the Peru Free Trade Agreement to show that you are
listening, to incorporate our ideas into that agreement, and to prove
that you deserve the trust we showed in granting trade promotion
authority.
I believe in lowering trade barriers, and that is why I have
supported every trade agreement that has come before me, until today.
But that will become considerably more difficult without trade
promotion authority. I sincerely hope we can work together over the
next year to save it.
The PRESIDING OFFICER. The Senator from Pennsylvania is recognized.
Mr. SPECTER. I thank the Chair.
(The remarks of Mr. Specter pertaining to the introduction of S. 3614
are printed in today's Record under ``Statements on Introduced Bills
and Joint Resolutions.'')
Mr. SPECTER. I thank the Chair. I thank my distinguished colleague
from West Virginia for waiting. I know he has an important speech to
give. I just conferred with the Senator from West Virginia, and it is
his Fourth of July speech. It is a little early for the 4th, but there
may not be too many people
[[Page S6770]]
in the Chamber on the 4th or the 3rd or the 2nd or the 1st or even
tomorrow, the 30th of June. I compliment Senator Byrd in advance.
I yield the floor.
Mr. BYRD. Mr. President, I thank my distinguished friend, my longtime
friend, the Senator from Pennsylvania, Mr. Specter, for his kind
reference to me. I value his friendship. I value his views on the
Constitution. I do, indeed, always.
Mr. SPECTER. I thank my colleague
____________________