[Congressional Record Volume 153, Number 105 (Wednesday, June 27, 2007)]
[House]
[Pages H7271-H7277]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ANDEAN TRADE PREFERENCE ACT EXTENSION
Mr. RANGEL. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 1830) to extend the authorities of the Andean Trade
Preference Act until September 30, 2009, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 1830
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. EXTENSION OF ANDEAN TRADE PREFERENCE ACT.
(a) Extension.--Section 208(a) of the Andean Trade
Preference Act (19 U.S.C. 3206(a)) is amended by striking
``June 30, 2007'' and inserting ``February 29, 2008''.
(b) Repeal of Conditional Extensions.--Section 208 of the
Andean Trade Preference Act (19 U.S.C. 3206) is amended--
(1) by striking ``(a) Termination.--Subject to subsection
(b), no'' and inserting ``No''; and
(2) by striking subsection (b).
SEC. 2. TREATMENT OF CERTAIN APPAREL ARTICLES.
Section 204(b)(3)(B) of the Andean Trade Preference Act (19
U.S.C. 3203(b)(3)(B)) is amended--
(1) in clause (iii)--
(A) in subclause (II)--
(i) by striking ``Subject to section 208, the'' and
inserting ``The''; and
(ii) by striking ``4 succeeding 1-year periods'' and
inserting ``5 succeeding 1-year periods''; and
(B) in subclause (III)--
(i) by striking ``means 2 percent'' and inserting ``means--
``(aa) 2 percent'';
(ii) by striking the period at the end and inserting ``;
and''; and
(iii) by adding at the end the following:
``(bb) for the 1-year period beginning October 1, 2007, the
percentage determined under item (aa) for the 1-year period
beginning October 1, 2006.''; and
(2) in clause (v)(II)--
(A) by striking ``Subject to section 208, during'' and
inserting ``During''; and
(B) by striking ``3 succeeding 1-year periods'' and
inserting ``4 succeeding 1-year periods''.
SEC. 3. MERCHANDISE PROCESSING FEES.
Section 13031(j)(3)(A) of the Consolidated Omnibus Budget
Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)(A)) is
amended by striking ``September 30, 2014'' and inserting
``October 14, 2014''.
SEC. 4. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES.
Subparagraph (B) of section 401(1) of the Tax Increase
Prevention and Reconciliation Act of 2005 is amended by
striking ``114.25 percent'' and inserting ``114.50 percent''.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from New
York (Mr. Rangel) and the gentleman from Louisiana (Mr. McCrery) each
will control 20 minutes.
The Chair recognizes the gentleman from New York.
Mr. RANGEL. Mr. Chairman, I yield myself such time as I may consume.
Mr. Speaker, as most of us know, some time ago in 1991, President
Bush, with bipartisan support, reached out to the Andean countries and
extended favorable treatment as related to their exports to the United
States.
This has proven successful in making it possible for these countries
to get substitute crops for coca, and, therefore, it has been
tremendously successful in building up a market for the people in this
area, as well as people in the United States of America.
Right now, however, there are four free trade agreements that are
pending that haven't passed the House as yet, which includes, of
course, Peru. So as we speak, there are two countries for which free
trade agreements have not been negotiated, Colombia and Peru. If we
were to allow this provision to expire, we would find ourselves in the
situation where these countries and their tariffs would be in disarray.
Because of the shortness of notice, and because we have to avoid the
expiration, I have been able to work with Mr. McCrery in our committee
to get, not a 2-year extension that we would really want, but at least
an 8-month extension to avoid irreparable damage from being caused
during this period, at which time we will again able to review the
situation in the free trade agreements and also the substance of the
continuation of the Andean Trade Preference Act, trade promotion
agreements.
{time} 1815
I also would like to say, in working with Mr. McCrery of the
committee, the Members of this House should know that the cooperative
spirit in which we got this extension extended to the point that we had
to really go to the other Chamber in order to work out what we're able
to do today.
Mr. Speaker, at this time I reserve the balance of my time.
Mr. McCRERY. Mr. Speaker, I yield myself so much time as I may
consume.
Mr. Speaker, I've been an avid supporter of Andean preferences, and
today I voice my support for this short-term extension of the
preferences. And I want to thank Chairman Rangel for working with me
and others to effect what we believe should pass on the floor today
under suspension of the rules.
Our country's relationship with the Andean countries of Peru,
Colombia, Ecuador and Bolivia is vitally important, and preferences
have helped enormously with their economic development and with
stability in the region.
At the same time, however, I believe it is time to move to a more
substantial, mature and reciprocal relationship through free trade
agreements. The unilateral preferences provide duty-free treatment to
products from the region, but very limited value to United States
interests in return. The FTAs, the free trade agreements, provide
reciprocal market access benefits, creating new opportunity for United
States producers, farmers and exporters.
I might add that our FTAs also create greater obligations on our
trading partners than preferences by requiring them to abide by
fundamental labor rights and certain multilateral environmental
agreements.
Right now we have an immediate opportunity to implement the FTAs with
Peru and Colombia, with the possibility of future FTAs with Ecuador and
Bolivia. We should seize this opportunity now. Both Peru and Colombia
have already passed the pending FTAs, and they are expected soon to
pass amendments to them reflecting the recently concluded bipartisan
trade deal on labor and the environment.
It's time for our Congress here in the United States to move these
FTAs, too. Preferences are a stopgap measure. Our trading partners and
United States interests deserve more than that. Every day we wait is a
lost opportunity to gain the advantages of those more mature
agreements.
With respect to Ecuador and Bolivia, I remain very concerned with the
treatment of United States investors there. This 8-month extension
gives us time to evaluate how these countries are abiding by the
preference program requirements with respect to United States
investment. We will be watching developments very carefully.
Mr. Speaker, I support this short-term extension of preferences for 8
months, which will give us the time we need to implement our
outstanding free trade agreements in the region. The first step will be
to complete congressional action on the Peru agreement, I hope, before
the August recess. The time is now to solidify our relationship,
instead of perpetuating what I believe is an unsatisfactory status quo.
Mr. Speaker, I reserve the balance of my time.
Mr. RANGEL. Mr. Speaker, I'd like to yield 4 minutes to Mr. Levin,
who's been the subcommittee Chair on Trade and has done an absolutely
great job in spearheading this bipartisan approach of this sensitive
subject.
(Mr. LEVIN asked and was given permission to revise and extend his
remarks.)
Mr. LEVIN. Mr. Speaker, as we proceed, it should be clear. We're
talking now about the Andean Trade Preference Act, and we're not
talking about the free trade agreements that have been discussed here.
In my view, whether one supports or opposes any of those free trade
agreements, it would be counterproductive for someone to vote against
extension of the ATPA for 8 months.
This relates, as mentioned, to the four nations. The original ATPA
was passed in 1991, and it was expanded and
[[Page H7272]]
extended through a voice vote in the year 2001.
I think it should be emphasized that, basically, our trade
relationship with these four nations is more complementary than it is
competitive. That's a crucial issue. And if you exclude oil and oil
products, our trade balance, our relationship, is essentially balanced
in the range of 10- to $11 billion that we export and they export, if
you exclude oil, which is not covered by the ATPA.
The Andean countries are a steadily growing market for U.S. goods,
and that meant there was an increase, a rather substantial one, in 2005
over 2004.
Let me touch briefly on issues that have been discussed regarding the
ATPA. First, apparel. The Andean Trade Preference Act requires the use
of U.S. yarns in fabrics, so it isn't a one-way street. And it's
somewhat technical, but if you include, if you look at the source of
the fabric, essentially the U.S. has made clear that we're not going to
be left out in the cold.
In terms of crops, whether they're fruit or vegetable crops, the
trade is far more seasonal. In that sense, the trade is far more
complementary than it is competitive. And so it's been of mutual
interest to have this Andean Trade Preference Act. And that's why it
was passed originally with broad support. It was extended with broad
support. There was controversy last time because it was tied to TPA,
and it essentially gave different treatment to Bolivia and Ecuador that
this bill does not do.
So it's also, I think, because of the complementariness of this
agreement that it has had broad support in this country, and that's
true in good parts of the management ranks as well as the labor ranks.
There's been reference here to drugs, and that's been a mixed
picture. But I think there is evidence that the ATPA, which was
originally passed as part of a drug eradication strategy, has had some
positive impact in several countries, much less so I think in Colombia
than in Bolivia and Peru.
If this is not renewed, I think it would be mutually disadvantageous.
I think, because of the mutuality of this agreement, the way it's
worked out, that we should pass it.
And I close by emphasizing we're talking today about the renewal, or
I should say the extension, of the ATPA for 8 months. We're not talking
about free trade agreements. I strongly urge approval of this 8-month
extension.
Mr. McCRERY. Mr. Speaker, for the purpose of controlling time, I'd
like to yield the balance of my time to Mr. Herger from California.
The SPEAKER pro tempore (Mr. Pomeroy). Without objection, the
gentleman from California will control the balance of the time.
There was no objection.
Mr. HERGER. Mr. Speaker, I wish to yield 2 minutes to the gentleman
from Illinois (Mr. Weller), a member of the Ways and Means Committee
and a very active member of the Trade Subcommittee.
Mr. WELLER of Illinois. Mr. Speaker, I rise to join in the strong
bipartisan support for this legislation which is critical to our need
to continue working to reduce poverty, to create jobs and to strengthen
democracy.
Today this House has an opportunity to continue moving forward by
extending the Andean trade preferences for Peru, Colombia, Ecuador and
Bolivia. It's only a short-term extension, 8 months, but it moves
forward.
Just like the Caribbean Basin Initiative, these preferences create
jobs, reduce poverty and also build capacity in nations that previously
were left out. The Andean preferences offer many who have been
previously left out of the opportunity to participate in free
enterprise as well as the export marketplace.
I think of examples of communities who benefit. I think of the
Gatazo-Zambrano community in Chimborazo, Ecuador, 400 indigenous
families now being lifted out of poverty because they are now exporting
broccoli and produce to the U.S. export market.
I think of the thousands of women engaged in flower production, as
well as the processing of flowers in Colombia, involved in that
industry, dependent on these preferences. And if they went out of
business, China would take over the flower business.
There's almost 2 million jobs dependent in the Andean region on these
Andean preferences which we created to lift people out of poverty. If
you care about democracy in Latin America, you should vote ``yes.'' If
you want to increase and expand markets for U.S. products, you should
also vote ``yes'' because we in the United States benefit from the
Andean trade preferences.
U.S. workers and businesses benefit, farmers; U.S. cotton exports to
Peru and Colombia totaled $110 million in 2006, almost double that of
2001. U.S. yarn and fabric exports to Peru and Colombia more than
doubled between 2002 and 2006.
And I would note that when we import garments from the Andean region
benefiting from the Andean trade preferences, the components are
largely from inputs manufactured in the United States. The Andean trade
preferences are win/win for both.
It's important to remember they're temporary. We have good trade
agreements with Peru and Colombia. We also need to move forward on
them. And I urge a bipartisan bill today.
Mr. RANGEL. At this time, Mr. Speaker, I'd like to yield 3 minutes to
the gentleman from Washington (Mr. McDermott), an outstanding member on
our committee.
Mr. McDERMOTT. Mr. Speaker, is the gentleman from New York willing to
engage in a brief colloquy?
Mr. RANGEL. I'd be glad to.
Mr. McDERMOTT. We appreciate the legislation that you've put before
us today. The Andean Trade Preference Promotion Act continues to enjoy
broad bipartisan support, and I believe the program is needed because
we have a responsibility to ensure that our market, the largest in the
world, remains open to the products from developing nations.
ATPA is a program that is helping to reduce poverty and strengthen
our economic ties with our hemisphere, but it really is only one scheme
of many. The generalized system of preferences is also a vital tool we
use to fight global poverty and better engage with developing
countries.
As you know, the duty-free treatment GSP provides to imports coming
from developing nations like India and Brazil is at risk of being
eliminated by the Bush administration. In the case of India, the
tariffs the Bush administration will propose on Indian jewelry will
cause the loss of 300,000 jobs, and that would weaken our strategic
alliance with an important ally. In this case, what's bad for India is
also bad for the United States.
Now, in the coming weeks and months, I hope that we can work together
to ensure that any GSP benefits aren't revoked for arbitrary reasons
that would have a negative outcome in developing countries. And I hope
that you would be willing to listen to those kind of proposals.
Mr. RANGEL. Let me thank my dear friend from Washington and indicate
that I share your concern. At the end of the day, America must have a
trade policy that helps workers here at home and provides opportunities
for workers overseas. As the Chairman of the House Committee on Ways
and Means, I can assure you that I will work with you and others to be
sure that we can improve our trade policy as it relates to developing
countries.
In the case of GSP and the benefits the administration may propose to
eliminate, let me make it abundantly clear that on our watch we're
going to expand opportunities to the developing world and not curtail
them.
I'm pleased to know that you're working on some innovative ways to
improve our trading ties with Africa and Least Developed Nations. Let
it be clear to you, the Congress and everyone else that if the
administration proposes to impose tariffs on products coming from poor
countries, and that such tariffs serve no development purpose, I will
be working with you to move toward legislation to prevent that from
happening.
And let me add this, that your constant concern about making America
look like it's a country for freedom and opportunity and providing
trade with these nations has been indicated by your leadership in the
African growth and opportunity bill, the Caribbean Basin Initiative,
and I hope to continue to work with you to bring opportunities for
people in developing countries and make our country all that she can
be.
[[Page H7273]]
{time} 1830
Mr. HERGER. Mr. Speaker, I yield 2 minutes to the gentleman from
Indiana (Mr. Burton).
Mr. BURTON of Indiana. Mr. Speaker, I just want to start off by
thanking my good friend Charlie Rangel, the chairman of the Ways and
Means Committee, for bringing this legislation to the floor. We have
talked to a number of the countries involved in the preferences, and
they were very concerned.
So, Charlie, I want to thank you for bringing this to the floor at
this time. I wish it was for a longer period, but 8 months, as has been
said by Mr. Weller, is a good start.
The one issue that I would like to mention, and it has not been
addressed, and that is creating jobs in Central and South America helps
us with our immigration problem. We are going to be talking about
illegal immigration here in a couple of weeks or a couple of days
maybe. I don't know when the Senate is going to send it over. But the
fact of the matter is where there is poverty, where there are no jobs,
where there is conflict, people leave and the people in Central and
South America, obviously, would come north to the United States. We
have a very serious immigration problem right now. In 1986 we tried to
solve it. It didn't work. We gave amnesty then. It won't work now. But
one thing that will help and will work to a degree are trade
preferences and free trade agreements, Charlie, and I hope that you, as
chairman of the Ways and Means, will look with some favor on some of
the free trade agreements when they come up later on. I think it helps
not only their economy and our economy, but it also helps with the
illegal immigration problem in the long run.
Mr. RANGEL. Mr. Speaker, I yield the balance of my time to the
chairman of the committee, Mr. Levin, and ask unanimous consent that he
be allowed to control that time.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from New York?
There was no objection.
Mr. LEVIN. Mr. Speaker, it is my pleasure to yield 3 minutes to the
honorable gentleman from New York (Mr. Engel), who chairs the Western
Hemisphere Subcommittee for Foreign Affairs.
Mr. ENGEL. Mr. Speaker, I thank my friend from Michigan for yielding
to me.
I rise today, Mr. Speaker, in strong support of H.R. 1830, which
extends trade preferences for Peru, Colombia, Bolivia, and Ecuador. I
want to thank Chairman Rangel, the dean of the New York delegation, and
Chairman Levin for their leadership on this issue.
I am the chairman of the Foreign Affairs Subcommittee on the Western
Hemisphere, and as chairman, I believe that the extension of the Andean
trade preferences is crucial in promoting development in the
economically and politically fragile Andean region while also
supporting essential U.S. geopolitical goals. My ranking member, Mr.
Burton, just spoke and gave very good reasons why this should be
supported. I agree with every one of them.
With anti-Americanism on the rise in the Western Hemisphere, I
believe that positive engagement with the Andean region can both
improve our image abroad and help us to more effectively engage our
neighbors. Many of our neighbors in the hemisphere feel a huge sense of
neglect from the United States. The extension of the Andean preferences
is a great way to show our neighbors that we are engaged and do indeed
care.
I believe that the preference program has been enormously successful,
having created hundreds of thousands of jobs in the Andean region.
Every job created in the Andean region is another potential illegal
immigrant remaining in their home country. Without the extension of
these preferences, these jobs, which are in sectors that do not
directly compete with U.S. jobs, will be eliminated.
I am also in possession of a letter from the AFL-CIO which gives its
approval of these agreements.
Moreover, I feel that without the extension of ATPA, many of the
unemployed in the Andean region would turn to drug cultivation after
they lose their jobs. The Andean preference program was originally
created not only to support economic development in the region but also
to divert illegal coca manufacturing toward legitimate industries.
Using these trade preferences as a tool in the drug war is still very
important today.
Mr. Speaker, let me conclude by mentioning that President Bush
recently traveled to five countries in the Americas in an effort to
reinvigorate our partnership with our friends in the region. Prior to
his trip, President Bush said that ``The working poor of Latin America
need change, and the United States of America is committed to that
change.'' I believe that the extension of ATPA can help bring this
well-needed change to our friends in the Andean region.
I want to emphasize that in my travels in the region, the region
feels that the United States is looking elsewhere and is not engaged.
The worst thing we could do would be not to pass this because it would
prove their fears. We need to pass this. We need to do it quickly, and
I urge Members on both sides of the aisle to support this.
Mr. HERGER. Mr. Speaker, I yield 3\1/2\ minutes to the gentleman from
Washington (Mr. Hastings).
Mr. HASTINGS of Washington. Mr. Speaker, I want to thank my friend
from California for yielding me the time.
I have to say that I stand here in opposition to this bill, and I am
one that generally supports fair trade liberalization efforts. I
believe that when properly structured, trade agreements can benefit all
parties involved. But, Mr. Speaker, the Andean Trade Preference Act is
not a trade agreement. This is an agreement to give access to the U.S.
market in return for reduced drug production by certain Andean
countries. Let me repeat that, Mr. Speaker. This is an agreement to
give access to the U.S. market in return for reduced drug production by
certain Andean countries.
The original idea may have been a noble one, and it probably still
is, but the Act has proven to be a failure, and as a result, American
asparagus growers have paid the price. In practice, the Andean Trade
Preference Act has resulted in higher South American drug production
and a steep loss of acreage and processing of asparagus in the United
States, as reflected by this chart where in the last 16 years the
amount of acreage has been reduced by 50 percent.
A recent International Trade Commission report found that asparagus
was the domestic commodity most negatively affected by the Act. Unlike
other sectors, American asparagus growers were not provided a
transition period before tariffs on Peruvian imports were unilaterally
eliminated. Since implementation of the Andean Trade Preference Act of
1991, imports of Peruvian asparagus have increased by more than 20
times. These duty-free imports have decimated U.S. asparagus growers
and closed domestic asparagus processing plants in my district.
Now, perhaps, Mr. Speaker, if you are not from an asparagus
production area in this country, you may be thinking this trade-off is
worth it because it results in less drug production. The unfortunate
reality is that this Act is a failure in that regard too. The latest
studies confirm that cocaine production in the Andean countries is
actually higher today than when the Andean Trade Preference Act was
adopted in 1991.
In other words, we have exported jobs from rural America to these
Andean countries and we are still seeing narcotics production going up.
Nevertheless, we are here asking American farmers to sacrifice their
livelihoods to perpetuate a wholly unrelated and unsuccessful anti-
narcotics strategy.
Mr. Speaker, I also regret that we are considering an extension of
this flawed policy under a process that denies Members the opportunity
to amend the bill, the text of which was not even available until a
couple of hours ago. This is being rushed to the floor with no time to
debate or offer amendments. The markup of this bill in Ways and Means
was cancelled. The bill has not gone through the Rules Committee. The
House should have an opportunity to have a full and fair debate on this
Act, which has a profound negative effect on my constituents.
So I ask my colleagues to oppose this bill.
I will insert into the Record an article from the Seattle Times that
more fully points out the dilemma that asparagus growers have suffered,
and,
[[Page H7274]]
also, I will insert into the Record an article from the New York Times
regarding the plight of asparagus growers as a result of this Act.
[From the Seattle Times, Jan. 2, 2007]
New Hope for Asparagus Growers
Washington asparagus growers might get a break in the new
Democrat-controlled Congress.
They sure need it.
The industry has been decimated by a U.S. drug policy
designed to encourage Peruvian coca-leaf growers to switch to
asparagus. Passed in 1990 and since renewed, the Andean Trade
Preferences and Drugs Eradication Act permits certain
products from Peru and Colombia, including asparagus, to be
imported to the United States tariff-free.
The act was set to expire Dec. 31, but Congress approved a
six-month extension to make time to negotiate a proposed
free-trade agreement.
We believe world markets should be more open and barriers
to trade should be lowered. But this trade preferences act,
when it comes to asparagus, is a one-sided deal that does
only harm to the U.S. industry while failing miserably at its
stated intent of reducing drug production.
The White House Office of National Drug Control Policy Web
site currently notes that the Peruvian coca acreage, mostly
in the highlands, is the highest it has been in eight years.
Meanwhile, the small country has become a powerhouse in
asparagus production along its Pacific Coast lowlands.
Peruvian asparagus production has multiplied 18-fold. The
industry has developed a vigorous market and attracted
sizable capital investment.
Meanwhile, the Washington industry is a shadow of its
former self. Acreage has been cut by 71 percent to just 9,000
acres. In 2005, Seneca closed the world's largest cannery in
Dayton, Columbia County, and shipped its state-of-the-art
equipment to--no surprise--Peru. So did Del Monte, when it
closed its Toppenish plant.
Is it any wonder the U.S. asparagus industry hopes the
preferences act will be allowed to lapse in June?
That's not to say the Washington Asparagus Commission has
its head in the sand over the global economy. In particular,
the commission is willing to support a proposed free-trade
agreement with provisions common to other free-trade
agreements.
The industry wants the tariff re-imposed on Peruvian
asparagus but only during the U.S. growing season--roughly
April through June in Washington--and then phased out over a
period of years. The tariff on U.S. production would diminish
also.
That would be a long, overdue solution for an industry
decimated by a drug-reduction policy that failed miserably.
____
[From the New York Times, Apr. 25, 2004]
War on Peruvian Drugs Takes a Victim: U.S. Asparagus
(By Timothy Egan)
After 55 years of packing Eastern Washington asparagus, the
Del Monte Foods factory here moved operations to Peru last
year, eliminating 365 jobs. The company said it could get
asparagus cheaper and year-round there.
As the global economy churns, nearly every sector has a
story about American jobs landing on cheaper shores. But what
happened to the American asparagus industry is rare, the
farmers here say, because it became a casualty of the
government's war on drugs.
To reduce the flow of cocaine into this country by
encouraging farmers in Peru to grow food instead of coca, the
United States in the early 1990's started to subsidize a
year-round Peruvian asparagus industry, and since then
American processing plants have closed and hundreds of
farmers have gone out of business.
One result is that Americans are eating more asparagus,
because it is available fresh at all times. But the growth
has been in Peruvian asparagus supported by American
taxpayers.
``We've created this booming asparagus industry in Peru,
resulting in the demise of a century-old industry in
America,'' said Alan Schreiber, director of the Washington
Asparagus Commission. ``And I've yet to hear anyone from the
government tell me with a straight face that it has reduced
the amount of cocaine coming into this country.''
Government officials respond that it was never their intent
to hobble an American industry. But they say a thriving
asparagus industry in Peru stabilizes the country and
provides an incentive to grow something other than coca
leaves, the raw material of a drug used regularly by about
2.8 million Americans.
``Apologies to the people affected,'' said David Murray,
special assistant for the White House's drug policy office,
``but the idea of creating alternative development,
countrywide, does serve our purposes.'' Mr. Murray said that
net cultivation of coca leaf in Peru had fallen considerably,
but that it was unclear how much of a role the alternative
crop incentives had played.
Here in Washington, the nation's second-leading asparagus
producer, after California, about 17,000 acres have been
plowed under since a 1991 trade act prompted a flood of less-
expensive Peruvian asparagus, a 55 percent decline in
acreage.
During the same period, Peruvian asparagus exports to the
United States have grown to 110 million pounds from 4 million
pounds.
Two of the biggest asparagus processing factories in the
United States have closed. The Del Monte plant in Toppenish
is still packing other vegetables, but it buys and packs its
asparagus in Peru. The other factory was in Walla Walla.
Peruvian asparagus is sold without tariffs under terms of
the Andean Trade Preference Act, signed in 1991 and renewed
in 2002. The United States also spends about $60 million a
year in Peru to help farmers grow and develop their industry
for asparagus and other crops seen as alternatives to coca.
Many American farmers still compete, saying they offer a
better-tasting and fresher product. But others have abandoned
the crop.
When the American factories closed, Washington farmers were
left without a buyer for millions of pounds of asparagus.
Among them was Ed McKay, who has given up on asparagus, a
crop that takes three to five years to mature, and then grows
perennially. After growing it for 50 years and employing more
than 100 people at the height of the season, he turned over
his 225 acres in central Washington near Othello last year,
and now plants some in corn and wheat, and lets other land go
fallow.
``We're a victim of the drug war,'' said Mr. McKay, 73.
``It seems like we still got plenty of cocaine coming into
this country, but now we got cheap asparagus as well.''
Acreage devoted to asparagus has dropped by a third in
California, and the crop has nearly disappeared from the
Imperial Valley, once a huge source of asparagus. Growers
blame imports from Peru, but also cheaper asparagus from
Mexico, which benefits from the North American Free Trade
Agreement.
In Michigan, the value of the industry has fallen by 35
percent since the Andean trade agreement. Michigan and
Washington have been hit the hardest because they lead the
nation in production of canned or frozen asparagus, a segment
that has been in particular decline with the year-round
Peruvian crop.
``The irony is that they didn't plow under the coke to
plant asparagus in Peru,'' said John Bakker, executive
director of the Michigan Asparagus Advisory Board. ``If you
look at that industry in Peru and where it's growing, it has
nothing to do with coca leaf growers becoming normal farmers.
Coca leaf is grown in the highlands. The asparagus is near
sea level.''
In a letter to the State Department in March, Peru's
government said the asparagus industry employed 50,000 people
and 40 percent came from coca-producing regions.
``It is important to understand that the war against drugs
is another face of the battle against terrorism, and will be
successful only if new legal jobs are created as an
alternative to illegal activities,'' the Peruvian Asparagus
and Other Vegetables Institute said in the letter.
Yet United States auditors, in a 2001 report to Congress,
said the Foreign Agricultural Service ``does not believe that
Peruvian asparagus production provides an alternative
economic opportunity for coca producers and workers--the
stated purpose of the act.''
Mr. Schreiber, of the Washington asparagus board, said he
had made two trips to Peru and doubted many coca growers had
turned to asparagus.
``I don't fault the Peruvians,'' Mr. Schreiber said.
``We're in this situation because of what our government has
done to us. They say it's a national security issue. Well,
the cost of it has been borne on the back of the American
asparagus grower.''
The 2001 report by the General Accounting Office, the
auditing arm of Congress, found that the value of the
asparagus processing industry in the United States had fallen
by nearly 30 percent, which it attributed to Peruvian
imports. The industry was valued at $217 million in 2000.
Asparagus is labor intensive, and some industry experts
have said Washington's high minimum wage of $7.16 an hour has
contributed to the industry's decline. But Mr. McKay, the
farmer, said he was able to pay high wages and even give
workers housing, and still make a profit before Peruvian
asparagus was given trade preference.
Mr. Bakker of the Michigan asparagus board said about 300
farmers in his state had lost a total of about $25 million
because of the cheaper Peruvian imports. The government has
bought some Michigan asparagus, but farmers there and in
Washington say money that is supposed to be available to
industries hurt by free trade pacts is difficult to get,
because of a formula that takes prices rather than job losses
into account.
``Our industry will disappear before we qualify for any
trade assistance money,'' Mr. Bakker said. ``And it's not
like Michigan farmers are against the war on drugs. There are
certainly social benefits from trying to curb cocaine
production, but why should one industry take it on the chin
for it?''
Mr. LEVIN. Mr. Speaker, it is my pleasure to yield 2 minutes to a
colleague on the Ways and Means Committee, a distinguished colleague,
indeed, Mr. Kind from Wisconsin.
Mr. KIND. Mr. Speaker, I thank my friend from Michigan for yielding
me this time.
I rise, as a member of the Ways and Means Committee, in strong
support of this 8-month extension of the Andean Trade Preference Act.
It is the right thing to do at the right time, Mr. Speaker.
[[Page H7275]]
There is no question, as my friend from New York just referenced
previously, that our image has been tattered and beaten abroad. That is
no less true here in the Western Hemisphere, especially with our
neighbors to the south, through Central and South America. And I have
always believed that our trade policies are more than just the exchange
of products and goods between our Nation and others but also an
important tool in our diplomatic arsenal. An arsenal that needs to be
rebuilt now even in our own Western Hemisphere.
But I also want to remind my colleagues that this is not a free pass
for these four Andean nations to get this trade preference. They have
certain strict criteria that they have to meet first to gain
eligibility for these preferences. Criteria such as respecting
internationally recognized worker rights, treating the United States
investors fairly, providing market access to U.S. goods, demonstrating
a commitment to implement its WTO obligations, and, finally, to meet
the U.S. counter-narcotics criteria.
And on that last point, it is not insignificant that there has been
substantial progress, according to our own State Department and USTR
office, of the drug eradication efforts and partnership that we have
established with these four Andean nations. They have also met the
criteria, again, through reference of our own State Department, but
ATPA is perhaps the single most effective alternative development
program we have going in the region. By providing these local citizens
with long-term alternatives to narcotics trafficking and illegal
immigration, ATPA has helped the governments, especially in Colombia
and Peru, to isolate violent extremist groups; to revise their
economies; and increase their investments in their education, health
care, and infrastructure system.
And I submit that if we are not trying to actively engage these
nations to help them build their economy and expand economic
opportunities, they are going to come to the United States to realize
those opportunities that they are not receiving in their own countries.
That is why I encourage my colleagues to support this extension.
Mr. HERGER. Mr. Speaker, I reserve the balance of my time.
Mr. LEVIN. Mr. Speaker, I now would like to yield 2 minutes to a very
valued Member of this body, and we came to this institution together,
Ms. Kaptur of Ohio.
Ms. KAPTUR. Mr. Speaker, I appreciate the chairman's yielding me the
time even though I rise in opposition to this bill and to any bill that
will continue to outsource more U.S. jobs, increase our trade deficit,
and not stop the import of illegal narcotics into this country.
This is another one of those bills cast in NAFTA model that is
already yielding over $10 billion a year in trade deficits to this
country by the outsourcing of our jobs. Why would we want to do more?
The American people elected us to make a difference. They are
expecting us to be different than the Thomas committee. Why are we
delivering the same kind of bills to this floor?
Procedurally, this bill is being brought up overnight without Members
even having the opportunity to read a text. I don't know who made that
decision. I doubt it was anyone on this floor. But for people who
represent districts like ours, it is truly a tragedy.
One fact we are certain of is that NAFTA-type agreements have cost
more jobs, more job losses, more trade deficit every time one of these
bills comes to the floor. When are we going to learn?
The idea of the Andean agreement was that it would help to displace
coca production with other economic enterprises, and yet we see coca
production increasing and more of those illegal drugs coming over our
border. When something isn't working, you ought to fix it.
We look at the provisions dealing with labor enforcement. There is no
enforcement, especially in the farm-related positions, in the flour
industry, in the asparagus industry, and so forth. There is no
enforcement in those countries. Why would we do this?
I would love to be a Member of this Congress when a trade agreement
is advanced that creates jobs in the United States of America, which is
our first responsibility, rather than outsourcing; that yields trade
surpluses, not growing deficits that are such a huge drag on this
economy, now knocking two points off GDP every year; and that treats
the Members of this institution with respect, with respect. Not
excluding those who disagree, but putting us around the table, letting
our voices be heard, letting us be constructive Members of this
institution.
{time} 1845
I would say to the leadership of this institution, treat the Members
with respect. We were also elected.
I thank the gentleman for allowing me this time to speak in
opposition.
Mr. HERGER. Mr. Speaker, I would just like to mention that the United
States is the number one trading Nation in the world. Because of the
great trade that we have, we have one of the lowest unemployment rates
of any Nation in the world, 4.5 percent.
Mr. Speaker, I yield 3 minutes to the gentleman from Texas, a member
of the Ways and Means Committee, a very active member of the Trade
Subcommittee (Mr. Brady).
Mr. BRADY of Texas. Mr. Speaker, I rise in support of this bill which
would provide a short-term extension of current trade preferences to
our Andean neighbors.
I have always supported the Andean trade program designed to help
create alternative jobs and economies to those in the drug trade and to
offer hope to these nations.
And it has worked. Millions of jobs have developed in the region in
the flower industry, in agriculture, all that contribute to
stabilization and economic growth, all of which are in America's
interest.
But preferences which are one-way trade into America aren't
permanent. They aren't designed that way because they matter. The
impact on American asparagus farmers, which has shrunk by a third as a
result of these preferences is a good example. And that's why it's
imperative that we work with our Andean neighbors to transition to two-
way free trade agreements that balance and strengthen our
relationships.
Not only is two-way trade fair, but it benefits all parties by
encouraging more permanent investment in nations where rule of law,
property rights, democracy and higher labor environmental standards are
insisted upon. This helps create even more jobs in the legitimate
market, more so than the preferences do today.
As an example, Peru's legislature today voted to amend our agreement
that incorporates important labor and environmental provisions
negotiated by Chairman Rangel, Ranking Member McCrery and others.
Approving the pending free trade agreements with partners Peru and
Colombia have significant security and foreign policy implications as
well by strengthening our hand against President Chavez in Venezuela
and his corrosive influence in the region.
Mr. Speaker, I support the preference extension. We shouldn't disrupt
current trade flows or hurt our friends in the region whose livelihoods
depend upon this program, but we need to move forward in a timely
manner with agreements with Peru and Colombia.
I am hopeful that Ecuador and Bolivia understand that one-way
preferences are temporary and require a good faith effort on their part
to address outstanding trade and expropriation issues if they wish to
continue.
Mr. LEVIN. Mr. Speaker, it is my pleasure to yield 2 minutes to
another distinguished member of the Ways and Means Committee, the
gentleman from Oregon (Mr. Blumenauer).
Mr. BLUMENAUER. I appreciate the gentleman's courtesy, as I
appreciate what my colleague from Ohio said a moment ago. But with all
due respect, I couldn't disagree with her more.
First of all, what is brought here today is not a NAFTA-type
agreement. Bear in mind, this is being urged for approval by the
Council of Textile Organizations, the Bush administration and the AFL-
CIO. It is an 8-month extension for us to be able to move forward in an
orderly fashion.
We have, in fact, heard concerns that have been voiced by our friend
from Ohio and others. That's why the committee is hard at work. And I
commend the leadership of Chairman Rangel and
[[Page H7276]]
Chairman Levin to be able to put together a framework on a bipartisan
basis that speaks to those concerns. I am quite confident when we bring
forward the FTAs that they are decidedly not NAFTA-type agreements.
I think the gentlelady is right, there are certain parts of this
decision that were made beyond perhaps the chairman, but there are also
two bodies that are at work. And our chairman has been working to be
able to accommodate a complex set of issues going forward.
This 8-month extension ought to be welcomed because it will enable
more concrete information to be available that I think will raise the
comfort level of the gentlelady. It will certainly speak to the
concerns that I have heard back home, and will underscore the hard work
that this committee has been doing.
I respectfully suggest that the work that we're going to see, for
example, with the environment in Peru, with illegal logging, with
what's happening with the environmental sector, labor standards, these
are going to provide a more complete package that is going to enable us
to have trade, provide that two-way comfort level, and work for all
concerns.
In the meantime, I would strongly recommend that we support this
extension under an expedited process that will enable us to return to
this floor with a more comprehensive approach, and that will enable us
to move our entire agenda forward.
Mr. HERGER. I now yield 2 minutes to the gentleman from California,
the ranking member of the Rules Committee (Mr. Dreier).
(Mr. DREIER asked and was given permission to revise and extend his
remarks.)
Mr. DREIER. Mr. Speaker, I rise in strong support of this extension.
I want to congratulate the chairman of the Ways and Means Committee,
the subcommittee chairman, and of course my very good friend and fellow
Californian (Mr. Herger) who joins with the distinguished ranking
member of the Committee on Ways and Means Mr. McCrery in moving this
effort forward in a bipartisan way.
As I listen to this debate, I heard my colleague from Ohio (Ms.
Kaptur) malign the issue of trade saying that she very much wants to
see trade agreements that create American jobs. I could not agree with
her more. I very much believe that as we look at trade agreements that
we have put into place, recognizing that we have an excess of a third
of a trillion dollars in cross-border trade between Mexico and the
United States of America following implementation of the North American
Free Trade Agreement, that has demonstrated that what we're doing here
this evening is just a very small step in establishing these very
important agreements with Peru and Colombia. We hope very much that we
can do it with Bolivia and Ecuador, and we hope very much that we can
do it with Panama.
And frankly, as we look at those agreements, what is it that those
agreements will do? They will lower the tariff barriers that exist
preventing U.S. workers from having opportunities to send their goods
and services into those very important countries in this hemisphere.
I join with my colleagues who have underscored the fact that the
threat of Hugo Chavez and other leaders in this hemisphere is a very
serious one. The anti-American sentiment is high, and it's being fueled
by Hugo Chavez. He is very much opposed to these free trade agreements.
He is very much opposed to any opportunity to expand commerce within
this hemisphere. And that's why, for national security reasons, for job
creation reasons, and to benefit consumers right here in the United
States of America, it is very important, Mr. Speaker, that we have
strong bipartisan support for this effort. And let it lay the
groundwork for us to pass these important trade agreements for our
future.
Mr. LEVIN. Mr. Speaker, I reserve the balance of my time.
Mr. HERGER. Mr. Speaker, I yield myself as much time as I may
consume.
I support this short-term extension of the Andean preferences.
U.S. trade preferences for Colombia, Peru, Ecuador and Bolivia have
furthered important economic development and political purposes,
including creating incentives that shift from production of illegal
drugs to legitimate products, increasing economic growth in these
countries and strengthening democracy in the region.
The Andean trade preference expires on June 30. I believe that
extending these preferences is very important, but only as a short-term
bridge to implementing bilateral free trade agreements with these
countries. Such FTAs are reciprocal, open up more trade opportunities,
and provide permanent tariff reductions for U.S. interests as compared
to the temporary tariff reductions provided to Andean interests by the
preferences.
For example, the pending FTAs with Peru and Colombia will greatly
enhance our economic and trade ties to the benefit of the Andean and
U.S. industries and workers. According to the Office of the U.S. Trade
Representative, once the Colombia and Peru FTAs are implemented, one,
80 percent of U.S. exports of consumer and industrial goods will
immediately be duty free, with another 7 percent duty free within 5
years and our remaining tariffs eliminated within 10 years.
Two, a substantial amount of U.S. farm exports will receive immediate
duty-free treatment.
Three, Colombia and Peru will provide substantial market access to
U.S. service providers with very few exceptions.
Four, all U.S. information technology products will enter duty free.
And five, U.S. investors and intellectual property right holders will
receive important protections.
From the perspective of Peru and Colombia, these FTAs will expand
their trade opportunities with the United States. The FTAs, with their
permanence and, in many cases, immediate tariff reductions will provide
more certainty for their own industries and workers.
Moving to FTAs with our Andean trading partners also will greatly
build on our growing overall trade relationship with these countries at
a time when the EU and other countries are looking to strengthen their
own trade ties in the region. We must act now before the EU and other
countries pass us by.
At the same time we need to be wary over how Ecuador and Bolivia
react over the 8 months. We have been generous with preferences, but
I'm very troubled that the response in those countries has been a lack
of respect for the rights of U.S. investors. Our generosity has its
limits.
Mr. Speaker, I support the extension of the Andean preferences being
considered today which will allow these important benefits to continue.
At the same time it is important for us to remember that we have the
unique opportunity now to go beyond the Andean preferences and expand
our economic and trade ties to Peru and Colombia through the pending
FTAs. Therefore, I look forward to House consideration of the Peru FTA
in July, and then moving through the other pending FTAs.
The time is now to solidify our relationship. I urge my colleagues to
support this legislation.
Mr. Speaker, I yield back the balance of my time.
Mr. LEVIN. I want to be clear; we're voting on the Andean Trade
Preference Act, we are not voting on FTAs. We are not voting for a
bridge to other agreements, we're voting on the merits of the extension
of this Trade Preference Act.
It has basically worked. On this side, we're opposed to one-way trade
agreements. This has been a two-way passage for those countries and for
this country.
Our trade, if you include oil not covered by the Trade Preference
Act, has essentially been in balance. We should extend this on its own
merits.
In terms of asparagus, if you look at the facts, it shows that these
agreements are basically complementary and not competitive.
I urge support of this extension, as I said, on its own merits, not
because anyone is trying to use this as a path to anything else.
Vote ``yes'' on this. Be clear. This has been a two-way street, which
this side of the aisle has insisted on as a basic part of American
trade policy, and we will continue to do that, building upon it with a
new model of trade.
I urge a strong vote for this extension.
[[Page H7277]]
Ms. SUTTON. Mr. Speaker, trade is a complex issue. But some things
are very clear--We need a fair playing field for our workers and
businesses and we need a new trade model, with enforceable standards
and rules to eliminate unfair trade practices.
So why are we continuing to seek to expand a trade policy that has
proven time and time again to be harmful for American workers,
businesses, farmers and communities? And why are we seeking to expand
the Andean Trade Preference Act or ATPA when there appears no
substantive reason to extend the preferences.
According to the Congressional Research Service (CRS), we have a $10
billion and growing trade deficit with the four ATPA nations, Colombia,
Peru, Bolivia and Ecuador. American farmers and workers have been
directly harmed by the ATPA as can be seen with our asparagus and
fresh-cut flower industries. According to the U.S. International Trade
Commission, these domestic producers have been affected by lower prices
and many growers have gone out of business as a result.
Under the ATPA, flower imports from Colombia and Ecuador receive
duty-free treatment, seven though the workers who grow, harvest, and
package these flowers routinely experience a number of labor rights and
human rights violations. By law, the ATPA is supposed to condition
these trade benefits on improvements in worker rights in these
countries. However, labor rights violations in the flower industry and
other sectors, including violations of the right to freedom of
association, continue unchecked.
Where is the enforcement from the Bush Administration? Where is the
outrage from this Congress.
Also promised to us when the ATPA was enacted in 1991 was a reduction
in coca production in the four ATPA countries. However, in Colombia,
according to the CRS, coca crop size estimates remain mostly unchanged
since the enactment of the ATPA and in Peru coca crop cultivation has
actually grown. Colombia remains the source of roughly 90 percent of
the cocaine entering the U.S. In a 2001 report to Congress, the U.S.
Foreign Agricultural Service said that they ``do not believe that
Peruvian asparagus production provides an alternative economic
opportunity for coca producers and workers--the stated purpose of the
Act.'' And all this is on top of the fact that Colombia has an
appalling horrific record on labor and human rights--Leading the world
in the number of unionists murdered year after year.
So why are we seeking to give Colombia further trade preferences?
Mr. LEVIN. Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from New York (Mr. Rangel) that the House suspend the rules
and pass the bill, H.R. 1830, as amended.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Ms. KAPTUR. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the
Chair's prior announcement, further proceedings on this question will
be postponed.
____________________