[Congressional Record Volume 156, Number 30 (Thursday, March 4, 2010)]
[Senate]
[Pages S1180-S1181]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. SPECTER (for himself, Mr. Casey, and Mr. Brown, of Ohio):
  S. 3080. A bill to provide for judicial determination of injury in 
certain cases involving dumped and subsidized merchandise imported into 
the United States, and for other purposes; to the Committee on Finance.
  Mr. SPECTER. Mr. President, I have sought recognition today to 
introduce the Unfair Foreign Competition Act of 2010. This legislation 
provides a private right of action for domestic manufacturers injured 
by illegal subsidization and dumping of foreign products into U.S. 
markets. These anticompetitive, predatory trade practices steal jobs 
from our workers, profits from our companies, and growth from our 
economy.
  Job creation and job retention in this country depend in large part 
on our ability to enforce existing trade laws. At a time when 
unemployment remains at nearly 10 percent and our economic future is at 
stake, it becomes even more important that we focus on trade priorities 
which too long have been sacrificed for foreign policy and defense 
interests.
  The latest trade numbers demonstrate that the U.S. trade deficit with 
China in November 2009 was $20.2 billion. Over the years, imports from 
China have exceeded our imports by a staggering $208.6 billion. This is 
not evidence that American manufacturers cannot produce goods 
efficiently or compete with foreign markets; rather, it is evidence of 
unlawful behavior on the part of China. Such behavior is tantamount to 
international banditry, and it must not be tolerated.
  In the current environment, I believe it is necessary for an injured 
industry to have an opportunity to go into Federal court and seek 
enforcement of our country's trade laws.
  My legislation addresses two specific types of illegal trade 
practices: dumping, which occurs when a foreign producer sells a 
product in the United States at a price that is below the producer's 
sales price in its home market or at a price which is lower than its 
cost of production, and subsidizing, which occurs when a foreign 
government provides financial assistance to benefit the production, 
manufacture, or exportation of a good.
  Under current law, the International Trade Commission and the 
Department of Commerce conduct antidumping and countervailing duty 
investigations and 5-year reviews under title VII of the Tariff Act of 
1930. U.S. industries may petition the ITC and Commerce for relief from 
dumped and subsidized imports. If Commerce finds that an imported 
product is dumped or subsidized and the ITC finds that the petitioning 
industry is materially injured or threatened with material injury, an 
antidumping duty order or countervailing duty order will be imposed to 
offset the dumping or subsidies.
  Because current administrative remedies have not been consistently 
and effectively enforced, I am introducing private right of action 
legislation to enforce the law. My legislation would allow petitioners 
to choose between the ITC and their local U.S. district court for the 
injury determination phase of their investigation. Doing so gives 
injured domestic producers the opportunity as private plaintiffs to 
control the litigation in seeking enforcement of our trade laws. If 
injury is found, U.S. Customs and Border Protection would then assess 
duties on future importation of the article in question. The legal 
standard for determining dumping margins, established by the Commerce 
Department, would remain unchanged.
  This legislation is similar to legislation I have introduced as far 
back as 1982 when I originally sought injunctive relief. But this bill 
has been modified to comply with World Trade Organization rules.
  In December 2004, the United States took action to comply with WTO 
rulings on the Antidumping Act of 1916 which provided a private cause 
of action and criminal penalties for dumping by prospectively repealing 
the act. The United States also took action in February 2006 to comply 
with WTO rulings on the Continued Dumping and Subsidy Offset Act which 
requires the distribution of collected antidumping and countervailing 
duties to petitioners and interested parties in the underlying trade 
proceedings. In both cases, the WTO panel found that U.S. law allowed 
an impermissible specific action against dumping and subsidization.
  The legislation I introduce today has been adapted to these changes 
in law and allows for a determination of injury in accordance with our 
international obligations. Aggressive policy measures, such as this 
legislation, are necessary to prevent foreign producers--China in 
particular--from causing a major crisis for our domestic producers.
  In testimony before the ITC earlier this year, I noted that we have a 
complicated relationship with China. I was one of 15 Senators who 
opposed China's entrance into the WTO in 2000. With China's economy 
still widely under state direction and characterized by dubious trade 
practices, I believed Chinese membership in the WTO would present a 
likelihood of trade distortion and market disruption. And that is why I 
voted against it in 2000.
  Congress heeded some of the concerns which I and others expressed and 
inserted a China-specific safeguard provision under section 421 of the 
Trade Act. But such a safeguard is only as effective as the President's 
willingness to enforce it. Seven petitions have been filed under 
section 421 since its inception. Of these, the ITC has made an 
affirmative determination of injury in five cases. Yet only one 
determination, handed down in the most recent Chinese tires case, has 
been upheld by the President. Despite overwhelming evidence to support 
the ITC's findings of

[[Page S1181]]

injury, President Bush rejected all four previous petitions for relief 
on the ground that providing import relief was not in the economic 
interest of the United States. Since President Bush's decision, 
countless jobs in my State and across the country have been lost and 
the trade deficit has widened. It is difficult to understand how 
providing import relief was not in our economic interest.
  President Obama's decision to uphold the ITC rulings in the Chinese 
tires case last year is a step in the right direction, but much more 
needs to be done to ensure that domestic industries enjoy the 
protection afforded to them by existing trade laws.
  While it is my hope that this administration and future 
administrations will evaluate trade remedies objectively in terms of 
economic consequences, this act will provide a valuable tool for the 
domestic industry. I ask my colleagues on both sides of the aisle to 
join me in supporting this legislation.
  The enforcement of trade laws should not be a partisan issue. To 
those who decry our enforcement mechanisms as unabashedly 
protectionist, let me be clear. I believe in free trade. International 
trade and open markets are crucial to the economic prosperity of this 
country. But the essence of free trade is selling goods at a price 
equal to the cost of production and a reasonable profit. When one 
country engages in dumping or subsidization at the expense of other 
countries, it is the antithesis of free trade.
  Let me remind those who criticize our domestic safeguards that 
President Ronald Reagan, a staunch advocate of open markets, signed 
into law agreements limiting the imports of autos and steel and pushed 
for the Plaza Accord in 1985 which raised the value of the yen and made 
Japanese imports more expensive. President Reagan understood that free 
trade did not mean wholly unfettered, unregulated trade. Free trade 
does not mean turning a blind eye to illegal and unsavory practices 
committed by our trading partners.
  I have argued that enforcement of our trade laws is critical to 
ensuring that our domestic manufacturers have a fair opportunity of 
competing with foreign producers. But even the most stringent 
enforcement will be insufficient to fully counter the effects of 
substandard labor, trade, and environmental practices, particularly 
those practiced by China. The safeguard measures the United States 
negotiated in advance of China's entry into the WTO were designed to 
limit the destructive effects of surging Chinese imports on domestic 
producers. As a result, China's succession to the WTO accelerated a 
``race to the bottom'' in wages and environmental quality.
  Given these factors, in addition to China's mixed record on providing 
market access to the United States and its failure to provide 
protection of U.S. intellectual property rights, I urge that the 
Congress reexamine our trade agreement the United States signed with 
China and, if necessary, seek to withdraw permanent normal trade 
relations status from China. Such a withdrawal would be a serious 
measure, but we must be willing to demonstrate that we are serious 
about holding China to its international commitments.
  When the United States granted most-favored-nation status to China in 
2000, we lost our ability to demand that China play by the rules. We 
may have to regain this leverage if we are to maintain an equitable 
trading relationship with China and keep our domestic industry strong.
  As President Obama recently noted in his remarks at the Senate 
Democratic Conference, the United States is home to some of the most 
innovative, skilled, and efficient workers in the world. But advances 
in efficiency and innovation by our producers cannot make up for the 
unfair advantage held by countries that engage in illegal trade 
practices. Our industries can compete if the playing field is level, 
but if foreign exporters are not held accountable, and can freely 
undercut American producers with dumped goods and government subsidies, 
this country's economic future will be at risk. We must take a stand 
and we must do it now.
                                 ______