[Congressional Record Volume 156, Number 112 (Wednesday, July 28, 2010)]
[House]
[Pages H6183-H6189]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ESTABLISHING EMERGENCY TRADE DEFICIT COMMISSION
Mr. LEVIN. Mr. Speaker, I move to suspend the rules and pass the bill
(H.R. 1875) to establish an Emergency Commission to End the Trade
Deficit, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 1875
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. FINDINGS.
Congress makes the following findings:
(1) The United States has run persistent trade deficits
since 1978, and many of such trade deficits since 2000 have
been especially large.
(2) There appeared to be some improvements in the United
States trade balance in 2009, but this was during a time of
global economic crisis, and the reduction in the United
States trade deficit appears to be attributable to a
shrinking United States demand for imports rather than an
increase in United States exports.
(3) Many of the trade deficits are structural--that is,
with the same countries, year after year. In 2009, the United
States continued to have significant merchandise trade
deficits with the People's Republic of China ($226.8
billion), the European Union ($60.5 billion), Japan ($44.7
billion), and Mexico ($47.5 billion), notwithstanding the
overall decline in the United States trade deficit. In fact,
in 2009, China accounted for 44 percent of the United States
merchandise trade deficit.
(4) While the United States has one of the most open
borders and economies in the world, the United States faces
significant tariff and non tariff trade barriers with its
trading partners.
(5) The causes and consequences of the United States trade
deficit must be documented and recommendations must be
developed to expeditiously address structural imbalances in
the trade deficit.
SEC. 2. ESTABLISHMENT OF COMMISSION.
(a) Establishment.--There is established a commission to be
known as the Emergency Trade Deficit Commission (in this Act
referred to as the ``Commission'').
(b) Membership of Commission.--
(1) Composition.--The Commission shall be composed of 11
members, of whom--
(A) three persons shall be appointed by the President, of
whom one shall be appointed to represent labor interests, one
shall be appointed to represent small businesses, and one
shall be appointed to represent manufacturing interests;
(B) two persons shall be appointed by the President pro
tempore of the Senate upon the recommendation of the Majority
Leader of the Senate, after consultation with the Chairman of
the Committee on Finance of the Senate;
(C) two persons shall be appointed by the President pro
tempore of the Senate upon the recommendation of the Minority
Leader of the Senate, after consultation with the ranking
minority member of the Committee on Finance of the Senate;
(D) two persons shall be appointed by the Speaker of the
House of Representatives, after consultation with the
Chairman of the Committee on Ways and Means of the House of
Representatives; and
(E) two persons shall be appointed by the Minority Leader
of the House of Representatives, after consultation with the
ranking
[[Page H6184]]
minority member of the Committee on Ways and Means of the
House of Representatives.
(2) Qualifications of members.--
(A) Presidential appointments.--Of the persons appointed
under paragraph (1)(A), not more than one may be an officer,
employee, or paid consultant of the executive branch.
(B) Other appointments.--Persons appointed under
subparagraph (B), (C), (D), or (E) of paragraph (1) shall be
persons who--
(i) have expertise in economics, international trade,
manufacturing, labor, environment, or business, or have other
pertinent qualifications or experience; and
(ii) are not officers or employees of the United States.
(C) Other considerations.--In appointing members of the
Commission, every effort shall be made to ensure that the
members--
(i) are representative of a broad cross-section of economic
and trade perspectives within the United States; and
(ii) provide fresh insights to in identifying the causes
and consequences of the United States trade deficit and
developing recommendations to address structural trade
imbalances.
(c) Period of Appointment; Vacancies.--
(1) In general.--Members shall be appointed not later than
60 days after the date of the enactment of this Act and the
appointment shall be for the life of the Commission.
(2) Vacancies.--Any vacancy in the Commission shall not
affect its powers, but shall be filled in the same manner as
the original appointment was made.
(d) Initial Meeting.--Not later than 30 days after the date
on which all members of the Commission have been appointed,
the Commission shall hold its first meeting.
(e) Meetings.--The Commission shall meet at the call of the
Chairperson.
(f) Chairperson and Vice Chairperson.--The members of the
Commission shall elect a chairperson and vice chairperson
from among the members of the Commission.
(g) Quorum.--A majority of the members of the Commission
shall constitute a quorum for the transaction of business.
(h) Voting.--Each member of the Commission shall be
entitled to one vote, which shall be equal to the vote of
every other member of the Commission.
SEC. 3. DUTIES OF THE COMMISSION.
(a) In General.--The Commission shall be responsible for
examining the nature, causes, and consequences of the United
States trade deficit and providing recommendations on how to
address and reduce structural trade imbalances, including
with respect to the United States merchandise trade deficit,
in order to promote sustainable economic growth that provides
broad-based income and employment gains.
(b) Causes of U.S. Trade Deficit.--In examining the causes
of the United States trade deficit, the Commission shall,
among other things--
(1) identify and assess the impact of macroeconomic
factors, including currency practices, foreign government
purchases of United States assets, and savings and investment
rates, including savings rates of foreign state-owned
enterprises, on United States bilateral trade imbalances and
global trade imbalances;
(2) with respect to countries with which the United States
has significant, persistent sectoral or bilateral trade
deficits, assess with respect to the magnitude and
composition of such trade deficits--
(A) the impact of tariff and non tariff barriers maintained
by such countries and the lack of reciprocal market access as
a result of such barriers;
(B) the impact of investment, offset, and technology
transfer requirements by such countries;
(C) any impact due to the failure of such countries to
adhere to internationally-recognized labor standards,
including the extent to which such failure affects conditions
of competition with the United States or the ability of
consumers in such countries to buy United States goods and
services;
(D) any impact due to differences in levels of
environmental protection and enforcement of environmental
laws between such countries and the United States, including
the extent to which such differences affect conditions of
competition with the United States;
(E) policies maintained by such countries that assist
manufacturers in such countries, including the impact of such
policies on manufacturers in the United States; and
(F) the impact of border tax adjustments by such countries;
(3) examine the impact of free trade agreements on the
United States trade deficit;
(4) examine the impact of investment flows both into and
out of the United States on the trade deficit, including--
(A) the impact of United States outbound investment on the
United States trade deficit and on standards of living and
production in the United States;
(B) the impact that the relocation of production facilities
overseas has on the United States trade deficit, including by
reviewing major domestic plant closures over an appropriate
representative period to determine how much production
terminated from such closures was relocated offshore;
(C) the impact of foreign direct investment in the United
States on the United States trade deficit and on standards of
living and production in the United States; and
(D) the impact of United States bilateral investment
treaties, including bilateral investment treaties under
negotiation, on the United States trade deficit;
(5) examine the role and impact of imports of oil and other
energy products on the United States trade deficit; and
(6) assess the extent to which United States foreign policy
interests influence United States economic and trade
policies.
(c) Consequences of U.S. Trade Deficit.--In examining the
consequences of the United States trade deficit, the
Commission shall, among other things--
(1) identify and, to the extent practicable, quantify the
impact of the trade deficit on the overall domestic economy,
and, with respect to different sectors of the economy, on
manufacturing capacity, on the number and quality of jobs, on
wages, and on health, safety, and environmental standards;
(2) assess the effects the trade deficits in the areas of
manufacturing and technology have on defense production and
innovation capabilities of the United States; and
(3) assess the impact of significant, persistent trade
deficits, including sectoral and bilateral trade deficits, on
United States economic growth.
(d) Recommendations.--In making recommendations, the
Commission shall, among other things--
(1) identify specific strategies for achieving improved
trade balances with those countries with which the United
States has significant, persistent sectoral or bilateral
trade deficits;
(2) identify United States trade policy tools including
enforcement mechanisms that can be more effectively used to
address the underlying causes of structural trade deficits;
(3) identify domestic and trade policies that can enhance
the competitiveness of United States manufacturers
domestically and globally, including those policies of the
United States and other countries that have been successful
in promoting competitiveness;
(4) address ways to improve the coordination and
accountability of Federal departments and agencies relating
to trade; and
(5) examine ways to improve the adequacy of the collection
and reporting of trade data, including identifying and
developing additional databases and economic measurements
that may be needed to properly assess the causes and
consequences of the United States trade deficit.
SEC. 4. REPORT.
(a) Report.--Not later than 16 months after the date of the
enactment of this Act, the Commission shall submit to the
President and the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the Senate a
report that contains--
(1) the findings and conclusions of the Commission
described in section 3; and
(2) any recommendations for administrative and legislative
actions as the Commission considers necessary.
(b) Separate Views.--Any member of the Commission may
submit additional findings and recommendations as part of the
report.
SEC. 5. POWERS OF COMMISSION.
(a) Hearings.--The Commission may hold such hearings, sit
and act at such times and places, take such testimony, and
receive such evidence as the Commission considers advisable
to carry out this Act. The Commission shall hold at least
seven public hearings, one or more in Washington, D.C., and
four in different regions of the United States.
(b) Information From Federal Agencies.--The Commission may
secure directly from any Federal department or agency such
information as the Commission considers necessary to carry
out this Act. Upon request of the Chairperson of the
Commission, the head of such department or agency shall
furnish such information to the Commission.
(c) Postal Services.--The Commission may use the United
States mails in the same manner and under the same conditions
as other Federal departments and agencies.
SEC. 6. COMMISSION PERSONNEL MATTERS.
(a) Compensation of Members.--Each member of the Commission
who is not an officer or employee of the Federal Government
shall be compensated at a rate equal to the daily equivalent
of the annual rate of basic pay prescribed for level IV of
the Executive Schedule under section 5315 of title 5, United
States Code, for each day (including travel time) during
which such member is engaged in the performance of the duties
of the Commission. All members of the Commission who are
officers or employees of the United States shall serve
without compensation in addition to that received for their
services as officers or employees of the United States.
(b) Travel Expenses.--The members of the Commission shall
be allowed travel expenses, including per diem in lieu of
subsistence, at rates authorized for employees of agencies
under subchapter I of chapter 57 of title 5, United States
Code, while away from their homes or regular places of
business in the performance of duties of the Commission.
(c) Staff.--
(1) In general.--The Chairperson of the Commission may,
without regard to the civil service laws and regulations,
appoint and terminate an executive director and such other
additional personnel as may be necessary to enable the
Commission to perform its duties. The employment of an
executive director shall be subject to confirmation by the
Commission.
[[Page H6185]]
(2) Compensation.--The Chairperson of the Commission may
fix the compensation of the executive director and other
personnel without regard to the provisions of chapter 51 and
subchapter III of chapter 53 of title 5, United States Code,
relating to classification of positions and General Schedule
pay rates, except that the rate of pay for the executive
director and other personnel may not exceed the rate payable
for level V of the Executive Schedule under section 5316 of
such title.
(d) Detail of Government Employees.--Any Federal Government
employee may be detailed to the Commission without
reimbursement, and such detail shall be without interruption
or loss of civil service status or privilege.
(e) Procurement of Temporary and Intermittent Services.--
The Chairperson of the Commission may procure temporary and
intermittent services under section 3109(b) of title 5,
United States Code, at rates for individuals which do not
exceed the daily equivalent of the annual rate of basic pay
prescribed for level V of the Executive Schedule under
section 5316 of such title.
SEC. 7. AUTHORIZATION OF APPROPRIATIONS; GAO AUDIT.
(a) In General.--There are authorized to be appropriated
$2,000,000 to the Commission to carry out this Act.
(b) GAO Audit.--Not later than 6 months after the date on
which the Commission terminates, the Comptroller General of
the United States shall complete an audit of the financial
books and records of the Commission and shall submit a report
on the audit to the President and the Congress.
SEC. 8. TERMINATION OF COMMISSION.
The Commission shall terminate 30 days after the date on
which the Commission submits its report under section 4(a).
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Michigan (Mr. Levin) and the gentleman from Texas (Mr. Brady) each will
control 20 minutes.
The Chair recognizes the gentleman from Michigan.
General Leave
Mr. LEVIN. Mr. Speaker, I ask unanimous consent that all Members may
have 5 legislative days in which to revise and extend their remarks.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Michigan?
There was no objection.
Mr. LEVIN. I yield myself such time as I may consume.
Mr. Speaker, I urge Members to support H.R. 1875, a bill to establish
an Emergency Trade Deficit Commission. This commission will examine the
causes and the consequences of the United States' persistent and
substantial trade deficits, and it will provide recommendations on how
to address and reduce those deficits.
Over the past 10 years, our trade deficits have been unprecedented.
Before 2000, our largest trade deficit was in 1987 when the deficit was
equal to 3.3 percent of GDP, but that 1987 deficit pales in comparison
to the deficits we have had every year from 2000 through 2008. Indeed,
in 2006, our trade deficit represented 6.4 percent of GDP, nearly twice
as high as in 1987.
These enormous trade deficits are corrosive. They lower our GDP. They
weaken our economic growth. It is no surprise that global imbalances
and, in particular, huge U.S. trade deficits have contributed to the
global economic crisis that we are slowly recovering from. Our trade
deficits are improving now, but this appears to be largely due to a
still weak economic recovery, not to any structural policy change, and
many economists are warning that massive global imbalances will return
unless we take corrective action.
Our recent trade deficits are due, in part, to a passive, hands-off
approach to trade in the past. Proponents of this flawed approach
mistakenly believed that our trade deficits would resolve themselves.
Ignoring their effect on U.S. manufacturers, they claim that the
mercantilistic practices of China and of some of our trade partners may
be okay for the U.S. because they result in cheaper imports for our
consumers. This is not a trade policy; this is a recipe for economic
failure.
As our President has said: Trade is going to be reciprocal. It is not
just going to be a one-way street.
Those words have been backed up by strong action, such as the China
safeguard action the administration took last year.
To be sure, there are many causes of our trade deficits, many causes
which are not directly related to trade or to industrial policy. The
fiscal deficits we amassed over the past decade certainly played a
signature role, for example, and we need to confront those issues as
well. Trade can contribute substantially to the strength of our
economy, but it has to be reciprocal. It has to be two-way trade.
I believe that the work of the Emergency Trade Deficit Commission can
help us determine how best to achieve two-way trade. It can help us
expand and shape trade to ensure that it is working for working
Americans. It can help us make a thing of the past these corrosive
trade deficits that weaken our economy and hurt our workers and the
manufacturers which employ them.
I, therefore, urge my colleagues to vote in favor of this important
legislation.
Madam Speaker, I reserve the balance of my time.
Mr. BRADY of Texas. Madam Speaker, at this point I yield 4 minutes to
the gentleman from Kentucky, who is focused on creating manufacturing
jobs through open markets, Congressman Davis.
{time} 1200
Mr. DAVIS of Kentucky. Madam Speaker, I'm pleased that we're having
this debate today about the importance of trade for America's
manufacturing sector. Given my extensive experience in manufacturing,
I'm pleased to provide my firsthand familiarity with what makes
business successful and what creates jobs.
My own experience tells me that international trade is vital to the
success of America's manufacturing sector. In my home State of
Kentucky, nearly 50,000 manufacturing jobs are dependent on exports.
The simple fact is that 95 percent of the world's consumers live
outside the United States, and the fastest growing markets are outside
our borders. So success in those markets is critical to growing our
manufacturing sector and creating good paying jobs.
As the President has noted, America's exports of manufactured goods
support one out of every five manufacturing jobs, and those jobs pay 15
percent more than average. We simply must increase exports, and that's
the key to any debate about the trade deficit.
If we're going to be successful in growing U.S. exports and reducing
the deficit, we need to identify the best practices for doing so. We
have real world results that we can use to identify these best
practices, and these facts show clearly that there has been no more
effective way to reduce the trade deficit and create U.S. jobs than
negotiating new trade agreements to open foreign markets to U.S.
exports.
The benefits of CAFTA to the United States manufacturing sectors and
workers are clear. Because of this agreement, we swung a negative trade
balance, a trade deficit in manufactured goods of $1.1 billion, to a
trade surplus of $1.9 billion, and we already have a surplus of $1.3
billion so far this year.
Madam Speaker, in the manufacturing world, we'd never base our best
practices on just one successful outcome. Fortunately, the success of
the Central America Free Trade Agreement is not the only example we
have. The United States has implemented trade agreements with eight
other countries under the Trade Promotion Authority. In 2009, the U.S.
had an overall trade surplus of over $27 billion with these eight
countries, and so far in 2010, we have a surplus of over $14 billion.
And the results for the American manufacturing sector are even
stronger. In 2009, the United States had a trade surplus of over $29
billion with these countries, and in 2010, $16 billion. This is a track
record that firmly establishes the aggressive pursuit of trade
agreements as the best practice for increasing U.S. exports and
lowering the trade deficit.
Given the ambitious track record of success of our trade agreements,
I don't think we need another government commission. However, I
understand that for some, the facts I've cited aren't enough and,
therefore, I do rise in support of this bill.
I want to help those with doubts about the benefits of trade
agreements to see how vital they are to the success of American
manufacturing, so I'll support this legislation in an effort to educate
others on these benefits, the benefits of well-executed, bilateral, and
free trade agreements properly structured between the partners.
[[Page H6186]]
I fully expect the commission will reach the same conclusion that I
and many others on both sides of the aisle have already reached.
However, I'm concerned that we can't simply wait for the commission to
do its analysis.
As the President has noted, other countries are racing ahead of us in
negotiating agreements that benefit their workers while we sit on the
sidelines. That's why I strongly support the President's call to
resolve the outstanding issues around the U.S.-South Korea trade
agreement.
My colleagues and I on this side of the aisle stand ready to work
with the President to implement these best practices and prepare not
only the South Korea agreement for congressional approval, but to
prepare the agreements with Colombia and Panama as well. I'm confident
these agreements will be just as successful for American workers in the
U.S. manufacturing sector as our prior agreements.
Mr. LEVIN. I yield 2 minutes to the gentleman from New Jersey (Mr.
Pascrell), our distinguished colleague, a member of the Ways and Means
Committee.
Mr. PASCRELL. Madam Speaker, I want to agree with the gentleman from
Kentucky (Mr. Davis), but there's a catch here. In the last 6 months,
we have gained 136,000 manufacturing jobs, private jobs. It's one of
the few pluses that we can refer to. So there is hope for the future in
terms of manufacturing if we do the right thing.
I rise in support of H.R. 1875, the End the Trade Deficit Act, and I
want to thank my friend from Oregon for introducing this important
legislation. All through the years, Mr. DeFazio continues to speak out
over the din and over the years for the American consumer and for fair
trade policies. I salute you.
The United States has run a persistent trade deficit with the world
since 1978, including structural deficits with several major trading
partners year after year. This includes a $220 billion trade deficit
with China alone.
In 2001, just think of it, 9 years ago, China was granted admission
to the World Trade Organization, that number was $84 billion. It's
increased in 9 years by $136 billion. One study by the Economic Policy
Institute estimates that the dramatic increase in our trade deficit
with China alone has cost this country 2.4 million jobs.
The American people, the middle class, know that our trade policy has
not worked for them. They see it in their everyday lives. My hometown
of Paterson, New Jersey, I still live there. We close factories. We
reopen them south of the border or overseas. Why haven't we stopped the
hemorrhaging of jobs to places offshore?
The SPEAKER pro tempore (Ms. McCollum). The time of the gentleman has
expired.
Mr. LEVIN. I yield an additional 2 minutes to the gentleman from New
Jersey.
Mr. PASCRELL. We cannot continue down this path. Our trade deficit is
unsustainable. We must begin to tackle it if we want to create jobs
here in the United States and remain a prosperous country in the
future.
There's no silver bullet out there that will balance the books, which
is why a comprehensive study of the problem and recommendations for
policy solutions, which is proscribed in this legislation specifically,
is very necessary.
The commission will look at many of the tactics we know our trading
partners use in order to place their exports at an advantage and in
order that they have played and gamed the system to our disadvantage:
Foreign currency manipulation, we've addressed it in some esoteric
statements now and then. But we know what China is doing, and it hurts
us in terms of what the Americas are trying to do.
Tariff and nontariff barriers, just mentioned before in the previous
legislation by the gentleman from Illinois.
Foreign subsidization of manufacturing, other countries have
different taxing methodologies than we do. They subsidize their
industries. How can our industries compete against that unless we
address that particular issue, which we're afraid to do. Both sides of
the aisle are afraid to address the real issues on trade and the weak
environmental and labor standards.
I'm pleased the commission will include the impact of border tax
adjustments on our trade deficit, which penalized our exporters by an
average of 15.2 percent and are currently totally legal under current
global trade agreements.
We will not deal with the imbalance in our trade agreements unless we
understand how countries have gamed the system to hurt our workers, and
that's why we continue to offshore these jobs.
The SPEAKER pro tempore. The time of the gentleman has again expired.
Mr. LEVIN. I yield the gentleman an additional 30 seconds.
Mr. PASCRELL. At the end of the day, the United States is the most
open, accessible, and dynamic market in the world. We hold our trading
partners, hopefully, to the same standard. We must tackle our trade
deficit head-on so that United States businesses and families can
continue to prosper in the years to come.
I urge passage of this legislation. I eagerly await the report of the
commission.
{time} 1210
Mr. BRADY of Texas. Madam Speaker, I yield 3 minutes to the gentleman
who is the top Republican on the Oversight Committee on Ways and Means
and has focused both on ending the drilling moratorium that is killing
U.S. jobs in the gulf, and also opening new markets for our American
manufacturers, services, and ag community, the gentleman from
Louisiana, Dr. Boustany.
Mr. BOUSTANY. I thank the ranking member on the Trade Subcommittee,
Mr. Brady from Texas, for yielding time to me.
I think it's important to recognize, and I agree with the gentleman
who just spoke, Mr. Pascrell, that the United States has the most
vibrant, open market in the entire world, and we need to take advantage
of our leadership position. The U.S. has led globally since 1945 in
setting the standards for open trade.
Trade agreements give access to American workers and businesses to
other markets for U.S. services and products. Let's face it, 95 percent
of the consumers of the world are outside of the borders of the United
States. So our trade agreements create U.S. jobs.
Despite having the trade deficit that we've talked about, the U.S.
trade balance with 13 countries that we have free trade agreements
implemented through Trade Promotion Authority has really improved our
export capacity by 476 percent between 2001 and 2009, creating a trade
surplus with those respective countries of over $25 billion.
Case by case we can look at these: CAFTA-DR, Chile, Morocco,
Singapore, Australia. These trade agreements actually exceeded actual
export growth estimates initially put forth by the International Trade
Commission. The U.S. had a trade surplus with each of these countries,
enhancing the competitiveness of U.S. workers and businesses.
The failure to implement an aggressive trade strategy that focuses on
exports puts the U.S. at extreme risk of falling behind competitively.
We know that China's embarking on a very aggressive trade policy
globally. Other countries, Brazil. We have a very multipolar world
today with very aggressive trade policies working against us, and our
country has really been on the sidelines for the last year-and-a-half
in trade. This failure threatens U.S. credibility globally. Frankly, it
threatens the U.S. credibility. And it's also a threat to the historic
U.S. leadership role that we have set in setting open standards for
global trade.
Now, I believe that this new commission really is unnecessary. I am
going to support it if it's the only way we can jump-start something on
trade, but I really do think it's unnecessary. And if you go back and
look at the historic role that the Ways and Means Committee has played
in implementing an open trade policy, a trade policy that benefits U.S.
businesses and U.S. workers, it goes all the way back into the
twenties, and possibly even before that.
I remember reading about Cordell Hull as a member of the House Ways
and Means Committee, a Democrat who espoused open trade, and then went
on to become Secretary of State and continued to espouse open trade.
Our committee, the Ways and Means
[[Page H6187]]
Committee, has an illustrious history in doing this, and I believe
that's where the leadership should come from.
Mr. Chairman, I believe we can work together in trying to implement
in working with this current administration to come up with a really
good, solid trade strategy that really promotes U.S. competitiveness.
That's where I believe the authority should lie.
I believe it's pretty clear what we need to do. We ought to implement
the three pending free trade agreements: South Korea, Panama, and
Colombia. Let's move forward on these. These will immediately help
enhance exports and create U.S. jobs. They already have access to our
market. We need access to those markets. In the hearing just yesterday,
Stu Eizenstat, who served in the Clinton administration, talked about
these being no-cost stimulus, no-cost job creation mechanisms.
I also believe, in addition to implementing a very aggressive trade
strategy that focuses on U.S. exports not just for large corporations
but small and mid-sized companies as well, where we can really enhance
our export capacity, we also need to take a look at the other things
holding us back on U.S. competitiveness.
We need to lower the corporate rate. If we lower the corporate tax
rate, this will enhance U.S. competitiveness. And we also need to back
away from some of these proposals in international tax that are hurting
U.S. competitiveness.
The SPEAKER pro tempore. The time of the gentleman has expired.
Mr. BRADY of Texas. I yield the gentleman 1 additional minute.
Mr. BOUSTANY. If we lower our corporate tax rate at least down to
OECD averages, that will enhance U.S. competitiveness. And we do have a
different tax system than other countries utilize that I think actually
hurts our competitiveness. But if we actually take steps such as what
the administration has proposed in its current budget in the
international tax treatment of U.S. companies, we're actually going to
hurt U.S. job growth, we're going to hurt exports, and we're going to
hurt U.S. competitiveness. So I think it's imperative that we take a
look at this. And our committee, the Ways and Means Committee, should
take the lead in this issue as well.
Mr. LEVIN. It is now my distinct pleasure to yield 3 minutes to the
author of this legislation, the active, distinguished gentleman from
Oregon (Mr. DeFazio).
Mr. DeFAZIO. I thank the chairman.
It's interesting to hear some Republicans on the other side of the
aisle say this commission isn't necessary. We are going to run a $700
billion trade deficit this year. That means we will borrow,
predominantly from China, Japan, and a few other countries, $700
billion to buy things that we used to make in America. And it's not a
level playing field. We get played for a sucker in these trade deals.
We need a new, strong trade policy. Yes, American workers can
compete, but not on an unfair, tilted playing field, which is what
they're being asked to do today. I will give a couple of examples. When
we were doing MFN permanently for China, which I voted against because
we lost that annual leverage with them, wheat guys from Oregon came in,
and they said, Congressman, right now a ship is going into China.
Imagine what it's going to mean for our markets. They're finally
accepting our wheat. This new trade deal's going to be great.
I said, Well, actually, I have got translated broadcasts of their
agriculture minister that say that they're not going to allow that, and
they're not going to become dependent upon imported food. They said,
Oh, no, you are wrong. So, yeah, that one ship got in.
Congress voted the deal, China was permanently off the hook to be
reviewed for unfair trade practices by the Congress, and, guess what,
that was the last ship. They came in the next year kind of hanging
their heads and said, You were right. Are you going to say it? I said,
No. I am going to say, what are we going to do now? And talked about
fighting back against these unfair trade practices.
We can look at just after the first President Bush signed the deal
with Canada that was supposed to deal with their unfair subsidies and
dumping of cheap lumber into the U.S. But before the ink was even dry
on the deal, Canada reclassified much of their lumber to salvage. They
basically started giving away their trees on the stump instead of
making companies buy them and provided subsidized transportation and
other things and again flooded the U.S. market. We're still fighting
with the Canadians 17 years later over their subsidized lumber, and
we've still lost thousands of jobs.
Yeah, there was a little bit of cheaper lumber available here; but
when you lose the jobs for working-class Americans, middle class
American families, our consumers, when they lose their jobs, it doesn't
matter if a house is maybe $300 or $400 cheaper. They can't afford the
house. So we need a level playing field.
We need to identify these barriers that are being put up by the
Chinese and others. The Chinese are going to run more than a quarter of
a trillion dollar trade surplus with the U.S. this year. They recently
passed a law saying they're going to have a huge renewable program in
China. And the law says that nobody can buy a renewable windmill or
photovoltaic or anything else if it wasn't manufactured in China by a
Chinese company.
The SPEAKER pro tempore. The time of the gentleman has expired.
Mr. LEVIN. I yield an additional 2 minutes to the author of the bill.
Mr. DeFAZIO. I thank the gentleman.
So the Chinese have passed a law saying that no one in China can buy
a U.S.-made windmill or photovoltaic. If we get these green jobs and
green industry going that the President wants, the Chinese aren't going
to buy them. But guess what? The so-called stimulus bill that passed
this Congress, part of those funds, our taxpayer dollars, money we
borrowed in part from China to finance that bill, were used to buy
windmills made in China. They can get their windmills in here like
that.
There's a company proposing to assemble photovoltaics in my hometown
of Eugene, Oregon. But I also have people in Oregon trying to keep
their companies going with made in America photovoltaics. But they are
having trouble competing with the subsidized cheap junk from China
because their photovoltaics are not very good. Again, we can't send our
ours there, but they can send theirs here without any constraints.
I remember back to Lee Iacocca, back when we used to sort of laugh at
the Japanese cars. And when he had minivans and the Japanese started
producing minivans, he said, You know, I produce a minivan for $16,000.
I send it to Japan, it sits on the dock for 6 months while a series of
inspectors come down and look at it. And then finally when it gets to
the showroom, it costs $30,000 and it's been there 6 months. He said
the Japanese take their minivan, it costs $17,000 to make it--they were
less efficient then--he said they put it on a ship, it gets to
Portland, they roll it off, it's in the showroom the next day. Do we
ever reciprocate?
We say, okay, if you are going to keep our cars on your docks for 6
months, how about we're going to keep your cars on our docks for 6
months? And that's what the trade commission will point to. It will
point to the unfair trade barriers, these whole series of different
phytosanitary, or actually safety inspections, or currency
manipulation, all of the things that China and other countries are
doing to steal our jobs and kill off our industries. This commission
can point to those things, they can emphasize them, and they can
propose ways that we can deal with it more meaningfully in trade
agreements in the future.
I recommend to my colleagues, help end the trade deficit. Vote for
this legislation.
{time} 1220
Mr. BRADY of Texas. Mr. Speaker, I yield 2 minutes to the former top
Republican on the Trade Subcommittee, the gentleman from California
who's focused on creating jobs through selling more California and
United States products and services, Mr. Herger.
Mr. HERGER. Madam Speaker, I find it ironic that we are here today
creating one more commission to study a problem and report back with
possible solutions some time in the future when we could be taking
action right now today that would reduce our trade deficit and make a
real difference for American workers.
[[Page H6188]]
One of the findings in this bill states the problem very clearly:
``While the United States has one of the most open economies in the
world, the United States faces significant tariff and non-tariff trade
barriers with its trading partners.''
For example, over 90 percent of Panamanian and Colombian exports
enter the U.S. duty free. Additionally, the average Korean tariff for
U.S. exporters is more than four times the average tariff that Korean
products face in the United States market.
We could slash these high tariffs on U.S. exports and level the
playing field for American workers by passing the current pending Free
Trade Agreements with these three nations.
Madam Speaker, I urge my colleagues to continue the bipartisan
tradition since World War II of supporting trade and call for passage
of the pending FTAs with Colombia, Panama, and South Korea. If we
really want to create jobs, pass these trade agreements. If we want to
increase exports, pass these trade agreements. If we want to reduce the
trade deficit, pass these trade agreements. We don't need another
commission; we need action.
Mr. LEVIN. I reserve the balance of my time.
Mr. BRADY of Texas. Madam Speaker, I yield myself such time as I may
consume.
First, addressing some earlier comments, many Democrats, including
Chairman Levin, supported bringing China into the World Trade
Organization to force them to play by the rules. And since we've done
that, when they have violated those rules, the United States has
prevailed in seven of the eight complaints we have brought to that
organization. So it is helping keep China in line so we have a level
playing field.
Also, if you've picked up the paper in the last week, you've noticed
that while auto sales in the United States for our auto manufacturers
has remained flat, its sales are growing overseas, and its profits are
growing because they're allowed to sell American automobiles around the
world. That's good for the U.S. auto workers in the United States.
I appreciate the chairman bringing this legislation together. I know
it is well-intended. It's important to tackle America's trade deficit
the right way. And I think everyone understands another government
commission alone is no substitute for new customers for American
workers, farmers, and manufacturers.
The best way to strengthen the trade deficit while strengthening
America's economy is to reduce America's dependence on foreign oil and
open the world to more U.S. products and services. I know if my
Democrat friends and those in the White House are serious about
reducing the trade deficit, we are eager to work with them by starting
to take up and passing the pending trade agreements with South Korea,
Panama, and Colombia.
I rise in support of this bill because I think that any objective and
honest commission will find that creating new markets and new customers
for American exports will reduce our trade deficit, will create jobs,
and stimulate our economy.
I think it's absolutely appropriate that Congress is considering this
legislation today of all days. Today is the fifth anniversary of House
passage of the U.S.-Central American Free Trade Agreement, which gives
us an opportunity to look at real results. Those results clearly show
how trade agreements increase U.S. sales and reduce trade deficits. As
you know, America is a very open market. Countries sell into the United
States. But when we try to sell our products, too often we find that
``America need not apply'' sign.
Trade agreements tear that sign down and give us a chance not one-way
trade in, but two-way trade where we have a level playing field. The
world has changed. It's not enough to simply buy American. We have to
sell American. We have to sell our products and goods and services
throughout this world. In fact, over 80 percent of our trade deficit
today is with countries that are not trade agreement partners, that are
not level playing fields for the United States. That's why we push hard
for those agreements.
For example, 5 years ago the United States had a $1.2 billion trade
deficit with Central America. Last year, the United States had turned
that around, because of the agreement, to a $1.2 billion trade surplus,
and we're on track to surpass that surplus again this year. Last year,
the United States had a trade surplus in manufactured goods with our
Central American partners of almost $2 billion. We're on track again
this year.
Nor is CAFTA the only example of how trade agreements can improve the
U.S. trade balance. This week also marks the eighth anniversary of the
final House vote on the Trade Act of 2002, under which we have
resoundingly successful trade agreements with 13 countries now in
force. Last year, the United States had a trade surplus of over $25
billion with these 13 countries. And so far this year, we have a
surplus again.
Looking at just trade in manufactured goods reveals that these
agreements were even better for American manufacturing workers. Last
year, the United States had a trade surplus of over $29 billion in
manufactured products with these countries that we have free trade
agreements. And again, we have this year a surplus already of nearly
$16 billion. Without question, these trade agreements have reduced U.S.
trade deficits and increased U.S. trade surpluses.
The three pending agreements with Colombia, Panama, and South Korea
would have the same results by leveling the playing field for our
American workers.
Madam Speaker, there is one sector in which the United States runs a
structural trade deficit, that is energy, and I appreciate the chairman
including this in the commission. Last year, our deficit in energy
products accounted for almost half of the trade deficit.
So our trade deficit isn't principally in goods--it's in oil, it's in
energy. That's what the American people want to change. We can take an
enormous step toward reducing our trade deficit simply by increasing
American-made energy. Unfortunately, many Democrats in Congress have
taken just about every step they can to reduce American-made energy
production.
First, House Democrats rushed through the House a massive national
energy tax that would cripple the U.S. energy sector. Now, the White
House has defied the courts and has imposed a moratorium on offshore
drilling that damages jobs and damages U.S. energy production. The
impact of that moratorium would be to increase the deficit because it
will result in more imports of foreign oil. This moratorium also means
fewer manufacturing jobs.
In fact, last week a recent analysis by IHS Global Insight found the
drilling moratorium in the gulf would result in over 300,000 jobs lost
along the gulf and over $147 billion in lost State, local, and Federal
tax revenue. It is a terrible blow to American jobs.
If the sponsors of this legislation are serious--and I believe they
are--about reducing the trade deficit and working together to create
manufacturing jobs, let's focus on negotiating more trade agreements to
open foreign markets to our U.S. sales and promoting U.S. energy
production. We don't need a new government commission to accomplish
either of these.
{time} 1230
Madam Speaker, I yield back the balance of my time.
Mr. LEVIN. Now, that the distinguished ranking member on the Trade
Subcommittee has yielded back the balance of his time, I will close.
First of all, I want to thank Mr. DeFazio for introducing the bill
and for his willingness and his really effective efforts to work with
us. His staff also collaborated in bringing this bill to the floor. I
also want to thank Congressman Camp and Congressman Brady and their
staff for working with us.
So let me just say a word. We'll debate trade issues another time. I
think everybody here has spoken about the importance of two-way trade
and ending the one-way street. The problem with the Korea agreement, as
it was negotiated, was that when it comes to the industrial sector,
there was no way it was even close to a likelihood that there would be
two-way trade in vital industrial sectors. So far it's only been one
way, and now steps have to be taken with the other provisions in the
bill to make sure there's two-way trade in industrial, as well as
agricultural, goods as well as opening up their markets to service
products.
[[Page H6189]]
I think we're now finished with this. We can discuss the moratorium
on drilling some other day, and I now urge passage of this bill.
Mr. DINGELL. Mr. Speaker, I rise to express my strong support for
H.R. 1875, the End the Trade Deficit Act. I wish to commend my
colleague, Congressman DeFazio of Oregon for his fine work on this
bill.
At a time of nascent national economic recovery, we have the
opportunity to right the policy failures of the past. This is
particularly important with respect to trade. I have long criticized
the NAFTA trade agreement model for its detrimental effect on this
country's manufacturing base. Indeed, with the implementation of NAFTA
and CAFTA, we have witnessed the off-shoring of millions of good-paying
American jobs.
In light of this, H.R. 1875 will direct establishment of a commission
to develop a trade policy plan that will eliminate the U.S. merchandise
trade deficit and develop a competitive trade policy for the 21st
century. I am particularly pleased that this report, which will include
recommendations for administrative and legislative actions to reduce
this deficit, must be submitted to the Congress and the President prior
to the President's submitting any free trade agreement to the House and
Senate for approval.
Mr. Speaker, H.R. 1875 will substitute measured concern in place of
rash trade policy. I urge my colleagues to vote in favor of this bill
and in so doing, help this country achieve sustainable economic
recovery.
Mr. COSTELLO. Madam Speaker, I rise today in support of H.R. 1875,
the End the Trade Deficit Act of 2009.
Since coming to Congress, I have worked to level the playing field of
international trade, stop the illegal trade practices of other
countries, notably China, and support American workers. The first step
in achieving these goals must be addressing our $375 billion trade
deficit with other countries. While this deficit is down from the $753
billion deficit we had in 2006, as the global economy recovers, this
deficit has increased by billions of dollars each month, and our
deficit with China stands at a staggering $226 billion. In addition,
the U.S. has lost 3,178,000 manufacturing jobs since 1998 and the
recession has aggravated this damaging trend.
The Trade Deficit Review Commission established by H.R. 1875 will
take positive steps to address the trade deficit by developing a new,
competitive trade policy that emphasizes fair trade and U.S. jobs. Our
trade policy must promote the export of U.S.-made goods to foreign
markets and support our workers rather than aiding the multi-national
corporations who seek weaker labor, safety, and environmental
requirements overseas.
I have consistently opposed free trade agreements--including NAFTA
and DR-CAFTA--because I believe they have driven good-paying American
jobs out of the country. H.R. 1875 is needed to reverse these damaging
trade agreements and takes a positive step forward to revitalize
manufacturing in the U.S. and create jobs here at home.
Madam Speaker, I urge my colleagues to join me in supporting this
important legislation.
Mr. LEVIN. I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Michigan (Mr. Levin) that the House suspend the rules
and pass the bill, H.R. 1875, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
The title was amended so as to read:
``A bill to establish the Emergency Trade Deficit Commission.''.
A motion to reconsider was laid on the table.
____________________