[Congressional Record Volume 161, Number 77 (Tuesday, May 19, 2015)]
[Senate]
[Pages S3015-S3024]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ENSURING TAX EXEMPT ORGANIZATIONS THE RIGHT TO APPEAL ACT
The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of H.R. 1314, which the clerk will report.
The legislative clerk read as follows:
A bill (H.R. 1314) to amend the Internal Revenue Code of
1986 to provide for a right to an administrative appeal
relating to adverse determinations of tax-exempt status of
certain organizations.
Pending:
Hatch amendment No. 1221, in the nature of a substitute.
Hatch (for Flake) amendment No. 1243 (to amendment No.
1221), to strike the extension of the trade adjustment
assistance program.
Hatch (for Inhofe/Coons) modified amendment No. 1312 (to
amendment No. 1221), to amend the African Growth and
Opportunity Act to require the development of a plan for each
sub-Saharan African country for negotiating and entering into
free trade agreements.
Hatch (for McCain) amendment No. 1226 (to amendment No.
1221), to repeal a duplicative inspection and grading
program.
Stabenow (for Portman) amendment No. 1299 (to amendment No.
1221), to make it a principal negotiating objective of the
United States to address currency manipulation in trade
agreements.
Brown amendment No. 1251 (to amendment No. 1221), to
require the approval of Congress before additional countries
may join the Trans-Pacific Partnership Agreement.
Wyden (for Shaheen) amendment No. 1227 (to amendment No.
1221), to make trade agreements work for small businesses.
Wyden (for Warren) amendment No. 1327 (to amendment No.
1221), to prohibit the application of the trade authorities
procedures to an implementing bill submitted with respect to
a trade agreement that includes investor-state dispute
settlement.
[[Page S3016]]
The PRESIDING OFFICER. The Senator from Utah.
Mr. HATCH. Mr. President, as we resume consideration of our TPA bill,
I want to delve a little deeper into the process of considering and
approving trade agreements.
Throughout the debate surrounding this bill, I have heard the term
``fast-track'' used quite a few times. There was, in fact, a time when
trade promotion authority was commonly referred to as ``fast-track.''
Now, only TPA opponents use that term.
They want the American people to believe that under TPA, trade
agreements come to Congress and are passed in the blink of an eye.
Sometimes they use the term ``rubberstamp'' as if under TPA Congress
wielding ultimate authority over a trade agreement--the power to reject
it entirely--is a mere administrative act.
There is a reason the term ``fast-track'' isn't used anymore. It is
because those who are being truly honest know the process is anything
but fast.
I think it would be helpful for me to walk through the entire process
Congress must undertake before rendering a final judgment on a trade
agreement, to show how thoroughly these agreements are vetted before
they ever receive a vote.
Before I do, though, I will note for my colleagues that this bill
adds more transparency, notice, and consultation requirements than any
TPA bill before it. This bill guarantees that Congress has all the
information we need to render an informed up-or-down verdict on any
trade agreement negotiated using the procedures in this bill.
Congress's oversight of any trade agreement starts even before the
negotiations on that agreement begin.
Under this bill, the President must not only notify Congress that he
is considering entering into negotiations with our trading partners but
also what his objectives for those negotiations are. Specifically, this
has to happen 3 months before the President can start negotiating. That
is 3 months for Congress to consult on and shape the negotiations
before they even begin.
Congress's oversight continues as negotiations advance.
This bill requires the U.S. Trade Representative to continuously
consult with the Senate Finance Committee and any other Senate
committee with jurisdiction over subject matter potentially affected by
a trade agreement. Moreover, the USTR, the U.S. Trade Representative,
must, upon request, meet with any Member of Congress to consult on the
negotiations, including providing classified negotiating text.
The bill also establishes panels to oversee the trade negotiations.
These panels, the Senate Advisory Group on Negotiations and the
designated congressional advisers, consult with and advise the USTR on
the formulation of negotiating positions and strategies. Under the
bill, members of these panels would be accredited advisers to trade
negotiating sessions involving the United States.
Congressional oversight intensifies as the negotiations near
conclusion. At least 6 months before the President signs a trade
agreement, he must submit a report to Congress detailing any potential
changes to U.S. trade remedy laws.
Then, 3 months before the President signs a trade agreement, he must
notify Congress that he intends to do so. At the same time, the
President is required to submit details of the agreement to the U.S.
International Trade Commission. The ITC is tasked with preparing an
extensive report for Congress on the potential costs and benefits the
agreement will have on the U.S. economy, specific economic sectors, and
American workers.
I want to focus on the next step required by this bill because it is
a new requirement never before included in TPA. Sixty days before the
President can sign any trade agreement, he must publish the full text
of the agreement on the USTR Web site so that the public can see it.
This ensures an unprecedented level of transparency for the American
people and gives our constituents the material and time they need to
inform us of their views.
Only after the President has met these notification and consultation
requirements, only after he has provided the required trade reports,
and only after he has made the agreement available to the American
people, may he finally sign the agreement.
The process this bill requires before an agreement is even signed is
obviously quite complex, full of checks and balances, and provides
unprecedented transparency for the American public.
However, once the President does sign the agreement, his obligations
continue. Sixty days after signing the agreement, the President must
provide Congress a description of changes to U.S. law he considers
necessary. This step gives Congress time to begin considering what will
be included in the legislation to implement the trade agreement.
This is also the time when the Finance Committee holds open hearings
on the trade agreement in order to gather the views of the
administration and the public.
Following these hearings, one of the most important steps in this
entire process occurs, the so-called informal markup. The informal
markup is not always well understood, so I will take a minute to
describe it.
The informal markup occurs before the President formally submits the
trade agreement to Congress. As with any markup of legislation, the
committee reviews and discusses the agreement and implementing
legislation, has the opportunity to question witnesses about the
agreement, and can amend the legislation.
In the event of amendments, the Senate can proceed to a mock
conference with the House to unify the legislation. The practice of the
informal markup produces or provides Congress an opportunity to craft
the legislation implementing a trade agreement as it sees fit and to
direct the President on the final package to be formally submitted to
Congress.
While the informal markup is well established in practice, this bill,
for the first time in the history of the TPA, specifies that Congress
will receive the materials it needs in time to conduct an informal
markup. It requires that 30 days before the President formally submits
a trade agreement to Congress, he or she must submit the final legal
text of the agreement and a statement specifying any administrative
action he will take to implement the agreement.
The bill therefore ensures that Congress will have all the materials
it needs in time to conduct a thorough markup. Only at this point may
the President formally submit legislation implementing a trade
agreement to Congress, and only at this point do the TPA procedures,
first established in the Trade Act of 1974, kick in.
Once a bill implementing a trade agreement is formally submitted to
Congress, a clock for consideration of that bill starts. This clock
gives Congress 90 days in session to consider and roll out a bill. As
everyone here knows, 90 legislative days takes a lot longer than 90
calendar days. When I hear my colleagues talk about ``fast-track,'' I
think this is where they start the clock.
They are disregarding the years of oversight and consultations that
occurred during trade negotiations. They are ignoring the many months
of congressional consideration of trade legislation that occurs before
the President ever formally submits that legislation to Congress. They
are discounting that by this point in the process, Congress has held
hearings on the agreement, received views from the public, and
extensively reviewed the agreement and the implementing legislation
through an informal markup. Calling this part of the process fast-track
is like skipping to the end of a book and saying the author did not
develop a plot.
As I said, even here at the end of the process, the bill provides
more than 3 months for hearings, committee action, floor debate, and
votes. Sometimes I think that only a United States Senator could argue
that more than 3 months to formally consider legislation--legislation
that has already been thoroughly debated, vetted, and reviewed--is
making decisions too fast.
When Congress votes on an implementing bill, it is only after years
of oversight and months of formal review. So I have to ask, does this
process seem fast to you? If TPA is not fast, then what does TPA do?
Put simply, TPA guarantees a vote. TPA says to the world that when they
sign an agreement with the United States, Congress promises to say yes
or no to that agreement. Most importantly,
[[Page S3017]]
TPA guarantees that Congress will have the information in the time we
need to make that decision.
Without TPA, we are essentially telling the President to try to
negotiate the price of a house, and then after buying that home, we are
asking to renegotiate with the sellers. This would be absurd and rob
Americans of financial opportunities, employment, and a fair world
marketplace they can only get from free-trade agreements.
Once again, I urge all my colleagues to support the bill.
I yield the floor.
The PRESIDING OFFICER. The Senator from New Hampshire.
Mrs. SHAHEEN. Mr. President, I come to the floor today to discuss two
amendments that are pending to the trade bill. I want to begin by
thanking Chairman Hatch and Ranking Member Wyden, as well as Senators
McConnell and Reid, for working with me to make these amendments
pending.
I believe it is important that we have an amendment process as we
consider granting trade promotion authority to the President. Enacting
the bill before us will have major impacts on our Nation's economy for
years to come, and Senators should have an opportunity to improve the
product reported by the Committee on Finance.
The trade promotion authority bill by its very nature demands that
Senators be able to debate and vote on key trade issues. That is
because the trade promotion authority bill creates a process by which
trade agreements are submitted to Congress for approval without the
opportunity to change them on the House or Senate floor. So it is
critical that we utilize the opportunity we have now to set the rules
of the road for future trade agreements and to enact important trade
reforms.
Today, I would like to discuss two amendments I believe will
strengthen the trade package.
Amendment No. 1227
As ranking member of the small business committee, it is my
responsibility to look at bills on the Senate floor and ask: How does
this affect small businesses? How will they benefit or be harmed? How
can we improve this bill so that small businesses have a seat at the
table?
I think that is especially important as we talk about trade. Trade
has become increasingly vital for small businesses that are looking to
diversify and grow. Yet, even though 95 percent of the world's
customers live outside of the United States, less than 1 percent of our
small- and medium-sized businesses are exporting to global markets. By
comparison, over 40 percent of large businesses sell their products
overseas. As we consider this trade package, we must make sure small
businesses have a seat at the table and the resources they need to sell
overseas.
The amendment I filed incorporates bipartisan, commonsense measures
that will help small businesses take advantage of trade opportunities.
It reauthorizes the SBA's State Trade and Export Promotion Grant
Program. This program, known as STEP, was created as a pilot program to
help States work with small businesses to succeed in the international
marketplace. In just a few years, STEP has been a great success. Since
2011, it has supported over $900 million in U.S. small business
exports, producing a return on investment of 15 to 1 for taxpayers.
It has helped small businesses such as Corfin Industries, located in
Salem, NH. Before STEP, Corfin's international sales were just 2
percent. Now they are up to 12 percent. As a result, the company has
added 22 employees. That is the kind of job growth we will see in our
small businesses when we make sure they are part of our trade agenda.
Reauthorizing the successful STEP Program is a commonsense way to
make sure our small businesses can benefit from trade, and it builds on
bipartisan legislation that was first introduced by Senator Cantwell,
who was just on the floor, Senator Collins, and me.
The amendment also takes a number of steps to make it easier for
small businesses to access export services provided by the Federal
Government. It encourages those Federal agencies, such as the Small
Business Administration and the Department of Commerce, to work hand in
hand with State trade agencies that have on-the-ground knowledge of
local needs.
Finally, the amendment makes sure we understand how trade agreements
negotiated under trade promotion authority will affect small
businesses.
I urge my colleagues to support this small business amendment, and I
hope we can reauthorize the Ex-Im Bank so that our small businesses can
access that funding and get into those international markets.
Amendment No. 1226
The second amendment I would like to discuss is an amendment Senator
McCain, who is on the floor, and I have filed to repeal a harmful, job-
killing program--the USDA Catfish Inspection Program. This is something
Senator McCain has been working on for years. I have joined him in
recent years to try to address the concerns I have heard from companies
in New Hampshire that are going to be affected by that new USDA Catfish
Inspection Program.
Back in 2008, a provision was added to the farm bill that transferred
the inspection of catfish--only catfish--from the FDA, which inspects
all foreign and domestic fish products, to the U.S. Department of
Agriculture. It required USDA to set up a new, separate program to
inspect catfish alone.
I think this is a wasteful, duplicative program that will hurt
seafood-processing businesses across the country. There is no
scientific or food safety benefit here. In fact, officials from FDA and
USDA have explicitly stated that catfish is a low-risk food. In nine
separate reports, the Government Accountability Office has recommended
eliminating this program.
Even worse, this program is actually a thinly disguised trade barrier
against foreign catfish. We are facing an immediate 5- to 7-year ban on
imported catfish as soon as the USDA program is up and running. As a
result, our trading partners are explicitly threatening retaliation.
And since there is no scientific basis for this program, any WTO nation
that currently exports catfish to the United States could challenge it
and secure WTO-sanctioned trade retaliation against a wide range of
U.S. export industries, including beef, soy, poultry, pork, grain,
fruit, or cotton. The program is becoming a major issue of concern in
Trans-Pacific Partnership negotiations.
The only other time the Senate has voted on this issue was in 2012
when we voted to repeal it in a bipartisan voice vote. But since then,
we have been denied the opportunity to address this issue on the floor.
I think it is very important that we have an opportunity to vote on
this amendment because the USDA is poised to begin its inspection of
catfish very soon. This may be our last chance to solve this problem
before the program's harmful effects begin.
Again, we need an opportunity to vote on this amendment. I urge my
colleagues to support it and to repeal the duplicative USDA Catfish
Inspection Program.
I look forward to hearing what my colleague Senator McCain has to
say.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Arizona.
Mr. McCAIN. Mr. President, I wish to thank the Senator from New
Hampshire for her support and continuing efforts to get rid of this
wasteful, pork barrel, outrageous program that has cost the taxpayers
tens of millions of dollars and with regard to the catfish office
alone, about $20 million to date. As the Senator from New Hampshire
pointed out, this could put the entire TPP--Trans-Pacific Partnership--
Agreement in jeopardy. So this has a lot more to do with just catfish
here; it has a lot to do with our international relations and the
prospects of concluding or not concluding one of the most important
trade agreements arguably of the 21st century, obviously.
I am pleased to join my colleagues, Senators Shaheen, Ayotte,
Isakson, Kirk, Crapo, Risch, Casey, Reed, Peters, Wyden, Warner,
Cantwell, and McCaskill, in introducing this amendment, which has
already been made pending to the trade promotion authority act, which
would repeal a proposed Catfish Inspection Program at the U.S.
Department of Agriculture. The amendment would end the waste of
taxpayer money pouring into the creation of a USDA catfish office,
which is about $20 million to date. It would also save American farmers
and livestock growers from potentially losing billions of dollars in
lost market access to Asian nations.
[[Page S3018]]
As the Senator from New Hampshire pointed out, I have been fighting
this catfish battle for a long time. I first tried to kill an old
catfish-labeling program in the 2002 farm bill. Later, during the
Senate's debate on the 2012 farm bill, I offered a similar amendment to
repeal this new catfish program, which was adopted by voice vote. But
when the Senate took up the 2014 farm bill after failing to pass it in
2012, I was blocked from having a vote by the Democratic manager
despite her assurances that my amendment would receive a vote.
I note that my dear friend from Mississippi is here, and I know there
may be others who will want to preserve this $14 to $20 million waste
of taxpayer dollars. All I want is a vote. All I am asking for is an
up-or-down vote on whether we should continue to squander millions of
taxpayer dollars on a program that is not only duplicative but
endangers the entire Trans-Pacific Partnership Agreement we are
discussing today.
American agriculture is the heart of our efforts to pass TPA,
particularly as negotiators move closer to completing the Trans-Pacific
Partnership Agreement. TPA can put wind in the sails of the 12-nation
TPP, which will promote hundreds of billions of dollars of American
exports, including beef, pork, poultry, soy, wheat, vegetables, and
dairy products. The TPP covers an area of the world that accounts for
about 40 percent of global GDP and one-third of all trade. The TPP will
strengthen our security relationships with countries such as Japan,
Malaysia, Vietnam, and Australia, and provide a strategic counterweight
to Chinese protectionist influence. So it is our responsibility to pass
a trade promotion authority that signals to Asian trading partners that
we are serious about free trade.
Free trade is good for America. I am a representative of a State that
has immeasurably benefited from the North American Free Trade
Agreement.
By the way, many of the same interests and people who opposed that
are opposing this now--i.e., primarily the labor unions.
Here, that means eliminating this catfish program, which is one of
the most brazen and reckless protectionist programs that I have
encountered in my time in the Senate. The purpose of the USDA catfish
office is purportedly to make sure catfish is safe for human
consumption. I am all in favor of ensuring that American consumers
enjoy wholesome catfish. The problem is that the Food and Drug
Administration already inspects all seafood, including catfish.
The true purpose of the catfish program is to create a trade barrier
to protect a small handful of catfish farmers in two or three Southern
States. Let's be clear about what this is all about--protecting catfish
farmers in two or three Southern States. Yet, we are endangering the
entire agreement here. That is not right, and it is not right for the
American people.
In classic farm bill politics, southern catfish farmers worked up
some specious talking points--which will probably be repeated here
today--about how Americans need a whole new government agency to
inspect catfish imports. As a result, USDA will soon hire and train
roughly 95 catfish inspectors to work right alongside the FDA inspector
doppelgangers in seafood-processing plants across the Nation. Experts
say it could take as long as 5 to 7 years for foreign catfish exporters
to duplicate USDA's new program, which would give southern catfish
farmers a lock on the American seafood market.
Growing government is not cheap. To date, the USDA has spent $20
million to set up the catfish office without inspecting a single
catfish. I am not making that up. Moving forward, the USDA estimates it
will spend around $14 million a year once the program is operational.
GAO has investigated this catfish office and warned Congress in nine
different reports--nine different reports to GAO, which is probably
clearly the most trusted organization here--nine different reports. The
catfish office should be repealed. It is wasteful and duplicative. The
FDA already inspects seafood. It fragments our food inspection system.
Nine different reports. One GAO report is simply titled
``Responsibility for Inspecting Catfish Should Not Be Assigned to
USDA.'' The Government Accountability Office has repeatedly found that
catfish inspectors are a phony issue and warned that implementing the
USDA program might actually make food less safe for Americans by
fragmenting seafood inspections across two Federal agencies.
Here are a few GAO excerpts.
GAO, May 2012:
USDA uses outdated and limited information as its
scientific basis for catfish inspection. The cost
effectiveness of the catfish inspection program is unclear
because USDA would oversee a small fraction of all seafood
imports while FDA, using its enhanced authorities, could
undertake oversight of all imported seafood.
GAO, February 2013:
Congress should consider repealing provisions of the Farm
Bill that assigned USDA responsibility for examining and
inspecting catfish.
GAO, April 2014:
We suggested that Congress consider repealing these
provisions of the 2008 Farm Bill. However, the 2014 Farm Bill
instead modified these provisions to require the Secretary of
Agriculture to enter into a memorandum of understanding with
the Commissioner of FDA that would ensure that inspection of
catfish conducted by the FSIS and FDA are not duplicative. We
maintain that such an MOU does not address the fundamental
problem, which is that FSIS's catfish program, if
implemented, would result in duplication of activities and an
inefficient use of taxpayer funds. Duplication would result
if facilities that process both catfish and other seafood
were inspected by both FSIS and FDA.
Even if my colleagues do not care about ballooning government
spending and taxpayer waste, then consider the risk this catfish
program presents to jobs and agriculture exports from their home States
to an area of the world that accounts for 40 percent of the world's GDP
and one-third of its trade.
Ten Asian-Pacific nations have sent letters to the Office of the U.S.
Trade Representative warning that this USDA catfish office is hurting
TPP negotiations. At least one nation--Vietnam--has threatened trade
retaliation if the program comes online.
American trade experts are equally outraged. In a legal opinion
written by the former chief judge at the World Trade Organization--the
chief judge at the World Trade Organization said:
The United States would face a daunting challenge in
defending the catfish rule . . . there was, and still is, no
meaningful evidence that catfish--domestic or imported--posed
a significant health hazard when Congress acted in 2008 . . .
the complete lack of scientific evidence to justify the
catfish rule combines with substantial evidence of
protectionist intent.
He further notes that when it came to creating the USDA Catfish
Inspection Program in the dead of night using a farm bill conference
report--that is interesting, my colleagues; a farm bill conference
report was how this whole thing came about--``Congress shot first and
asked questions later.''
This is perhaps Mr. Bacchus's most poignant warning:
If Congress continues to mandate the transfer of
jurisdiction over catfish, it will not only be inviting a WTO
challenge to the rule; it will be giving other nations an
opening to enact ``copycat legislation'' which will
disadvantage our exports. Moreover, if the United States
somehow prevails in defending the catfish measure in a WTO
case, it will truly be ``open season'' in the rest of the
world for new restrictions on U.S. agriculture exports of all
kinds.
Mr. Bacchus is not alone in his assessment. The Wall Street Journal
has covered this catfish debacle over the years. The Wall Street
Journal has editorialized and reported on this many times.
This past weekend, the editorial board of the Wall Street Journal
penned an editorial entitled ``Congress's Catfish Trade Scam.''
The Wall Street Journal, lead editorial, ``Congress's Catfish Trade
Scam.''
``The U.S. slams a trade partner and raises prices for Americans.''
``Senate Democrats dealt a blow to economic growth Tuesday by
refusing to advance . . . Japan, Vietnam,'' et cetera.
The problem dates to 2002, when Congress barred Vietnamese
exporters from marketing as ``catfish'' an Asian cousin known
as pangasius with similar taste, texture and whiskers. But
that failed to curb American enthusiasm for the cheaper
foreign creature, which is common in fish sticks and often
called ``basa'' or ``swai'' on menus. So in 2003 Washington
slapped tariffs on the Vietnamese fish, claiming they were
``dumped'' into the U.S. market at unfairly low prices.
That didn't work either, so Mississippi Republican Thad
Cochran slipped a provision into the 2008 farm bill to
transfer regulatory
[[Page S3019]]
responsibility over catfish, including pangasius, to the U.S.
Department of Agriculture from the Food and Drug
Administration. The pretext was public health, but pangasius
posed no risk, and the USDA regulates meat and poultry, not
fish. The real aim was to raise costs for Vietnamese
exporters and drive them from the U.S. market.
Thus was born one of Washington's most wasteful programs,
which the Government Accountability Office has criticized
nine times and estimated to have cost $30 million to start,
plus $14 million a year to operate--as opposed to the
$700,000 annual cost of the original inspection regime. This
is ``everything that's wrong about the food-safety system,''
said former FDA food-safety czar David Acheson recently.
``It's food politics. It's not public health.''
Pangasius imports continue for now as the USDA sets up its
expensive new office, with the fish passing cod and crab last
year to become America's sixth most-popular. (Shrimp is
first.) Meanwhile, Vietnam has threatened to respond to a ban
by demanding the right to retaliate against U.S. beef,
soybeans and other products as part of TPP negotiations and
suing the World Trade Organization, where it would probably
win.
Most Members of Congress understand the damage, but Mr.
Cochran has used his seniority to block repeal. The latest
effort at repeal, sponsored by John McCain and nine other
Republicans and Democrats, could get a vote when the Senate
reconsiders the trade-promotion bill, then would have to go
through the House. Ending catfish protectionism would be a
sign that at least some in Washington are serious about free
trade.
Mr. President, I ask unanimous consent to have printed in the Record
the aforementioned Wall Street Journal editorial.
There being no objection, the material was ordered to be printed in
the Record, as follows:
[From the Wall Street Journal, May 14, 2015]
Congress's Catfish Trade Scam
Senate Democrats dealt a blow to economic growth Tuesday by
refusing to advance the trade-promotion bill needed to
complete the Trans-Pacific Partnership trade pact (TPP). Now
Japan, Vietnam and other negotiating partners will look to
see if Washington can salvage its trade agenda. They'll also
be watching Congressional jockeying over catfish. Allow us to
explain.
The problem dates to 2002, when Congress barred Vietnamese
exporters from marketing as ``catfish'' an Asian cousin known
as pangasius with similar taste, texture and whiskers. But
that failed to curb American enthusiasm for the cheaper
foreign creature, which is common in fish sticks and often
called ``basa'' or ``swai'' on menus. So in 2003 Washington
slapped tariffs on the Vietnamese fish, claiming they were
``dumped'' into the U.S. market at unfairly low prices.
That didn't work either, so Mississippi Republican Thad
Cochran slipped a provision into the 2008 farm bill to
transfer regulatory responsibility over catfish, including
pangasius, to the U.S. Department of Agriculture from the
Food and Drug Administration. The pretext was public health,
but pangasius posed no risk, and the USDA regulates meat and
poultry, not fish. The real aim was to raise costs for
Vietnamese exporters and drive them from the U.S. market.
Thus was born one of Washington's most wasteful programs,
which the Government Accountability Office has criticized
nine times and estimated to have cost $30 million to start,
plus $14 million a year to operate--as opposed to the
$700,000 annual cost of the original inspection regime. This
is ``everything that's wrong about the food-safety system,''
said former FDA food-safety czar David Acheson recently.
``It's food politics. It's not public health.''
Pangasius imports continue for now as the USDA sets up its
expensive new office, with the fish passing cod and crab last
year to become America's sixth most-popular. (Shrimp is
first.) Meanwhile, Vietnam has threatened to respond to a ban
by demanding the right to retaliate against U.S. beef,
soybeans and other products as part of TPP negotiations and
suing at the World Trade Organization, where it would
probably win.
Most Members of Congress understand the damage, but Mr.
Cochran has used his seniority to block repeal. The latest
effort at repeal, sponsored by John McCain and nine other
Republicans and Democrats, could get a vote when the Senate
reconsiders the trade-promotion bill, then would have to go
through the House. Ending catfish protectionism would be a
sign that at least some in Washington are serious about free
trade.
Mr. McCAIN. Mr. President, I ask unanimous consent to have printed in
the Record an article dated June 27, 2014, entitled ``U.S. Catfish
Program Could Stymie Pacific Trade Pact, 10 Nations Say''; a letter by
Jim Bacchus dated May 14, 2015; a letter dated May 13, 2015, from the
National Taxpayers Union, Taxpayers for Common Sense, Taxpayers
Protection Alliance, and Council for Citizens Against Government Waste,
all of them urging Congress to repeal the catfish program in TPA; a
letter dated May 14, 2015, from the National Restaurant Association;
and a letter dated April 22, 2015, from the Vietnamese Ambassador to
the Senate Finance Committee.
There being no objection, the material was ordered to be printed in
the Record, as follows:
[From the New York Times, June 27, 2014]
U.S. Catfish Program Could Stymie Pacific Trade Pact, 10 Nations Say
(By Ron Nixon)
Washington.--Ten Asian and Pacific nations have told the
Office of the United States Trade Representative that the
Agriculture Department's catfish inspection program violates
international law, and their objections could hamper Obama
administration efforts to reach a major Pacific trade
agreement by the end of next year.
They say that the inspection program is a trade barrier
erected under the guise of a food safety measure and that it
violates the United States' obligations under World Trade
Organization agreements. Among the countries protesting are
Vietnam and Malaysia, which are taking part in talks for the
trade agreement--known as the Trans-Pacific Partnership--and
have the ability to derail or hold up those negotiations.
The complaints are outlined in a May 28 letter signed by
diplomats from the 10 countries. The letter does not threaten
retaliation, but it emphasizes that the American catfish
program stood in the way of the trade talks.
Vietnam, a major catfish producer, has long complained
about the program, but it has never before won international
support for its fight. Several of the countries whose
representatives signed the letter--including the Philippines,
Myanmar, Thailand and Indonesia--do not have catfish
industries to protect and are not involved in the trans-
Pacific trade talks.
But the letter expresses the concern that the inspection
program could lead the Agriculture Department to expand its
ability to regulate seafood exports to the United States,
catfish or not.
``Many of these countries are looking to see what happens
to Vietnam on the catfish issues, and what precedents it
might set for other trade deals in the region,'' said Jeffrey
J. Schott, a senior fellow at the Peterson Institute for
International Economics in Washington and the co-author of a
book on the Trans-Pacific Partnership. The United States and
11 countries on both sides of the Pacific--as well as
Australia, New Zealand and Brunei--are still negotiating the
trade pact, which has been repeatedly delayed over various
disputes.
The Vietnam Association of Seafood Exporters and Producers
recently hired James Bacchus, a former chairman of the World
Trade Organization's appeals panel, to prepare a possible
legal challenge to the catfish inspection program.
Mr. Bacchus said in an interview that only governments have
standing to bring a case before the trade organization, but
that the export group was working closely with Vietnamese
officials to monitor the catfish inspection program.
``I'm confident that Vietnam would have a case before the
W.T.O. if they decided to bring one,'' said Mr. Bacchus, a
former United States House member from Florida who is now a
lawyer with Greenberg Traurig in Washington.
The inspection program was inserted into the 2008 farm bill
at the urging of catfish farmers, who have been hurt by
competition from both Vietnam and China and by the rising
cost of catfish feed. The domestic catfish industry has
shrunk by about 60 percent since its peak about a decade ago,
and in the past few years about 20 percent of American
catfish farming operations have closed.
The catfish industry and lawmakers led by Senator Thad
Cochran, Republican of Mississippi, fought for the new
office, saying it was needed to protect Americans from eating
fish raised in unsanitary conditions or contaminated with
drugs. The Food and Drug Administration has a similar
program, but it inspects less than 2 percent of food imports,
and advocates of the Agriculture Department program said that
was not good enough.
The Agriculture Department has traditionally inspected meat
and poultry, while the F.D.A. has been responsible for all
other foods, including seafood.
Agriculture Department inspections are more stringent than
those conducted by the F.D.A. The Agriculture Department also
requires nations that export beef, pork and poultry to the
United States to set up inspections that are equivalent to
the agency's program--an expensive and burdensome regulation
that Vietnam says is unnecessary for catfish. A Government
Accountability Office report in May 2012 called imported
catfish a low-risk food and said an Agriculture Department
inspection program would ``not enhance the safety of
catfish.''
The Agriculture Department said it had spent $20 million
since 2009 to set up its office, which has a staff of four,
although it has yet to inspect a single catfish. The
department said it expected to spend about $14 million a year
to run the program; the F.D.A., by comparison, spends about
$700,000 annually on its existing seafood inspection office.
Senator John McCain, Republican of Arizona, and other
critics say the Agriculture Department program is a waste of
money, and Mr. McCain sponsored an amendment in the latest
farm bill that would have killed the program. But the measure
was never brought up for a vote. The Obama administration has
also called for eliminating the Agriculture Department
program.
[[Page S3020]]
____
May 14, 2015.
Hon. Mitch McConnell,
Senate Majority Leader.
Hon. Harry Reid,
Senate Minority Leader.
Senators McConnell and Reid: As the Senate considers Trade
Promotion Authority, Trade Adjustment Assistance, and related
legislation, I wanted to make certain that you have the facts
about the USDA Catfish Inspection Program and its
implications for the United States in the world trading
system. In particular, I want to make sure you are aware that
the United States would face a daunting challenge in
defending the catfish rule.
As background, I am a former Member of Congress, from
Florida; a former international trade negotiator for the
United States; and the former Chairman of the Appellate
Body--the chief judge--for the World Trade Organization. In
nearly a decade of service to the Members of the WTO as one
of the seven founding judges on the highest global tribunal
for world trade, from 1995 through 2003, I judged many of the
most notable WTO trade disputes and wrote the legal opinions
in many of the WTO trade judgments on issues relating to
numerous aspects of both agricultural trade and food safety.
Currently, I chair the global practice of the Greenberg
Traurig law firm, for which I am writing in my capacity as
counsel to the National Fisheries Institute.
As you will recall, the 2008 and 2014 Farm Bills contained
language that would shift inspection of catfish from the Food
and Drug Administration (FDA) to the United States Department
of Agriculture's Food Safety Inspection Service (FSIS). FDA
currently regulates all seafood, and FSIS regulates beef,
pork, and poultry. Supporters of the transfer of jurisdiction
have reassured Senators that the USDA program would not
create a problem for the United States under WTO rules
because imported catfish would be subject to the same
standards as American catfish.
This is not so. The legal test of whether a measure, as
written or as applied, is consistent with WTO obligations is
not whether it imposes the same standard on like domestic and
imported products. The legal test in the WTO is whether such
a measure, as written or as applied, denies an equal
competitive opportunity to the like imported products in the
domestic marketplace. The catfish measure promises to fail
this fundamental legal test under international law.
It is not my intent here to list the entire catalogue of
claims that would be likely to be brought against the United
States in a ease in WTO dispute settlement by Vietnam and
possibly by other affected Members of the WTO following
implementation of the catfish measure by the USDA. There will
be more than ample opportunity for doing so later in Geneva
if the catfish measure is not repealed.
Suffice it to say that, if the catfish measure is not
repealed, and if it is implemented by USDA as currently
contemplated, quite a few strong claims could very likely be
made in WTO dispute settlement by the affected trading
partners of the United States under both the General
Agreement on Tariffs and Trade (the GATT) and the Agreement
on the Application of Sanitary and Phytosanitary Measures
(the SPS Agreement), which are both part of the overall WTO
treaty.
Because WTO litigation is intensely fact-specific, and
requires painstaking and extensive development and analysis
of the measures being challenged, I am always reluctant to
express a definitive opinion about a potential WTO case.
Having judged so many WTO cases, I am less inclined than
others to predict their outcome. This case, however, stands
out for the egregiousness of its inconsistencies with WTO
obligations. Quite rightly, the Congressional Research
Service has quoted approvingly a Wall Street Journal opinion
article that described the treatment of Vietnamese catfish in
this measure as ``protectionism at its worst.''
Nothing good can result for the United States from applying
the catfish measure.
Continuing with the implementation of the catfish measure
would further complicate the efforts of US trade negotiators
to secute significant concessions from Vietnam and others on
other issues of considerable importance to US businesses and
workers in the Trans-Pacific Partnership.
Losing a WTO case that challenged the catfish measure
would, if the United States chose not to comply with the WTO
ruling, give the complaining countries the right to retaliate
against American agricultural and other products bound for
their markets.
Perhaps worst of all for the United States would be winning
a WTO case that challenged the catfish measure.
The United States has a long and contentious history of
trying to overcome European and Asian trade barriers to our
agricultural and food products that are justified as ``food
safety'' measures but are in fact intended to block entirely
safe American food exports. For this reason, the United
States has long been the leading advocate for a strong SPS
agreement that ensures that food safety measures will be
based on real scientific evidence, including a serious risk
assessment.
If Congress continues to mandate the transfer of
jurisdiction over catfish, it will not only be inviting a WTO
challenge to the rule; it will be giving other nations an
opening to enact ``copycat legislation'' which will further
disadvantage our exports. Moreover, if the United States
somehow prevails in defending the catfish measure in a WTO
case, it will truly be ``open season'' in the rest of the
world for new restrictions on US agricultural exports of all
kinds.
Sincerely,
James Bacchus,
Chair, Global Practice.
____
May 13, 2015.
Dear Senator McCain: The undersigned groups representing
millions of taxpayers and allied educational bodies write in
support of your efforts to repeal the duplicative catfish
inspection program at the United States Department of
Agriculture (USDA) in S. 995, the Bipartisan Congressional
Trade Priorities and Accountability Act of 2015. The
undersigned groups have been vocal critics of the catfish
inspection program that has spent $20 million over four years
and not inspected a single fish. The Government
Accountability Office has nine times listed the program as
``wasteful and duplicative;'' and it is one that the former
Chief Judge of the highest court of international trade says
will result in not just a trade war but also a lawsuit the
U.S. will lose. Right now the program is on track to spend
$15 million annually for the USDA to do a job the FDA is
already doing.
Specifically on the issue of trade, according to an April
24, 2012 bipartisan letter to Senate Agriculture, Nutrition &
Forestry Chairwoman Debbie Stabenow (D-Mich.), ``And beyond
the fiscal implications, the catfish program has caused
considerable concern among trade experts. According to them,
the program would create a discriminatory de facto ban on
exports from key trading partners and expose us to
retaliation. . . . We are aware that no scientific data that
catfish, imported or domestic, pose any greater food safety
risk than other farmed seafood--all of which will remain
under FDA regulation.''
Eliminating the duplicative USDA catfish inspection office
was agreed to by voice vote in the 2013 Senate farm bill
debate, yet inexplicably the Senate was never granted an
opportunity to debate the merits of including this program in
the 2014 farm bill. But now with Trade Promotion Authority,
there is an opportunity to finally implement the will of the
Senate and end the duplicative waste that the USDA catfish
inspection program has continued to foster. We support your
efforts to repeal the program restoring some measure of
fiscal discipline and we urge your colleagues in the Senate
to do the same.
Sincerely,
Council for Citizens Against Government Waste, National
Taxpayers Union, Taxpayers for Common Sense, Taxpayers
Protection Alliance.
____
National Restaurant Association,
Washington, DC, May 14, 2015.
Dear Senator: On behalf of the National Restaurant
Association, I strongly urge you to support the bipartisan
McCain-Shaheen catfish amendment to the Senate's pending
trade related legislation. This amendment supports our
nation's businesses, farmers, customers and taxpayers by
removing funding for the duplicative U.S. Department of
Agriculture (USDA) catfish inspection program.
During the 2008 Farm Bill Conference, language was added to
transfer the responsibility for catfish inspections from the
Food and Drug Administration (FDA) to the USDA.
The USDA has already spent $20 million drafting regulations
and the Government Accountability Office (GAO) estimates that
the USDA will spend $170 million over the next decade
implementing the program. The GAO also found that
implementation of the USDA catfish program will cost American
taxpayers millions annually to provide a duplicative service
because the FDA currently inspects all seafood, including
catfish. Every U.S. facility that processes, handles, or
distributes catfish would now be subject to duplicative
regulation by both FDA and USDA.
As members of the foodservice industry, we are committed to
food safety. However, this new program would provide no
benefit. In fact, the USDA itself has stated that its Food
Safety Inspection Service (FSIS) would not provide additional
food safety protection. The Agency's cost-benefit analysis
also found no significant safety benefit in creating the
program.
Finally, implementation of this program could strongly
impact U.S. agricultural relations with key trading partners.
This program would create a potential trade barrier to
catfish imports and could violate the World Trade
Organization Sanitary and Phyto-Sanitary agreement. It could
also make U.S. agricultural exports susceptible to trade
retaliation.
For these reasons, we encourage you to help our nation's
businesses, farmers, customers and taxpayers by supporting
the bipartisan McCain-Shaheen amendment.
Sincerely,
Matt Walker,
Vice President, Government Affairs, National Restaurant
Association.
Laura Abshire,
Director of Sustainability & Government Affairs, National
Restaurant Association.
[[Page S3021]]
____
The Ambassador,
Embassy of Vietnam,
Washington, DC, April 22, 2015.
Hon. Orrin G. Hatch,
Chairman, Senate Finance Committee, Washington, DC.
Your Honorable: As ambassador of Vietnam to the United
States, I am writing to bring to your attention to the
concern of the Vietnamese Government related to the
discussion on the TPA/TPP at the Senate Finance Committee
under your leadership and seek your kind assistance on the
matter.
The concern is related to the so-called ``catfish
inspection program'' being transferred from the FDA to USDA,
for the following reasons:
The USDA program is duplicative with the FDA and National
Marine Fisheries Service.
It costs much more the U.S. tax payers and imposes
unnecessary regulatory complexity for seafood processors,
which in turn adds burden to the U.S. customers.
It adds nothing more to ensuring the safety of the
products.
It creates an inappropriate trade barrier that violates the
World Trade Organization (WTO) rules.
In particular, this provision is not in line with what is
to be achieved for the TPP, which is based on high standards,
including on trade liberalization.
The Government of Vietnam strongly urges that an amendment
to be set up to repeal the above-mentioned provision in the
process of consideration and approval of the TPA/TPP.
I count on your support in this regard. Please, accept,
Your Honorable, the assurances of my highest consideration.
Yours sincerely,
Pham Quang Vinh.
Mr. McCAIN. Mr. President, the National Restaurant Association sent a
letter:
On behalf of the National Restaurant Association, I
strongly urge you to support the bipartisan McCain-Shaheen
catfish amendment to the Senate's pending trade related
legislation. . . . As members of the foodservice industry, we
are committed to food safety. However, this new program would
provide no benefit. In fact, the USDA itself has stated that
its Food Safety Inspection Service (FSIS) would not provide
additional food safety protection.
Finally, implementation of this program could strongly
impact U.S. agricultural relations with key trading partners.
The Taxpayers Protection Alliance:
We support your efforts to repeal the program restoring
some measure of fiscal discipline and we urge your colleagues
in the Senate to do the same.
Mr. President, I understand that the parliamentary situation is that
we have a number of pending amendments and that probably it is very
likely that a cloture motion will be filed. That, of course, would then
mean I would not be allowed to have this amendment.
If we do not allow this amendment, I have to say that we will be
really showing a degree of contempt and arrogance for the taxpayers of
America. I have watched this program and this incredible--I have seen
$14 million wasted. I have seen an example of protectionism.
I was told in the last bill on agriculture that I would receive a
vote on my amendment. All I am asking for is a straight up-or-down vote
so we can save the taxpayers $14 million, $20 million, $30 million, $40
million on a program that is both wasteful and not needed.
I understand my colleagues from Mississippi and other Southern States
want to protect their catfish industry, which I have enjoyed many
samples of over the years. I do not understand the rationale for
continuing--particularly under conditions of sequestration--any program
that costs the taxpayers unending millions of dollars per year.
I urge my colleagues to demand a vote. All I am asking for is an up-
or-down vote on an amendment that is clearly relevant to the
consideration of this legislation.
I yield the floor.
The PRESIDING OFFICER. The Senator from New Hampshire.
Ms. AYOTTE. Mr. President, I want to add my support to the amendment
Senator McCain has just spoken to and my colleague from New Hampshire,
Senator Shaheen.
Absolutely we should have a vote on eliminating this duplicative
inspection of catfish, what the Wall Street Journal is calling one of
Washington's most wasteful programs, calling it the catfish scam.
In fact, we had testimony before the small business committee the
other day, and I asked the representative of the FDA whether we need
duplicative inspections of catfish because right now the FDA is
inspecting catfish for $700,000 a year, and this duplicative inspection
of it is estimated to cost over $14 million a year. In fact, there was
already a study done by the National Fisheries Institute that the USDA
had spent more than $20 million to have a duplicative inspection
regime. As Senator McCain mentioned, there are nine GAO reports about
the fact that we are wasting taxpayer dollars on a duplicative
inspection regime that we should eliminate.
The fact that we cannot get a vote on the Senate floor on such a
wasteful use of taxpayer dollars--this is why people get frustrated
with Washington when it is sitting right before us, and it is so
obvious that we should not waste their money when we already have a
perfectly good inspection regime that costs so much less versus this
added inspection regime, which in the end is going to hurt jobs across
this country, including jobs in New Hampshire, because it is going to
create not only a duplicative program that wastes taxpayer dollars that
common sense would tell us we should have a vote to eliminate, but it
is also going to eliminate the opportunity for trade. The free-trade
agreements that are currently being negotiated could mean over 8,200
jobs in my State.
James Bacchus, the former chief judge on the highest international
tribunal of world trade and former Member of Congress, said this
program will result not just in a trade war but also a lawsuit, and the
United States will lose. Not only will we lose taxpayer dollars by not
having a vote on this program and wasting money, but we will also
create an unnecessary trade barrier that could impede future trade
agreements and American jobs that can be created.
I offer my support for this amendment, and I do believe we should
have a vote on this amendment. Why wouldn't we have a vote on a program
that has demonstrated--by nine GAO reports--it has wasted millions of
dollars which could otherwise be used to pay down our debt or put to
good use in programs that are worthwhile. Yet here we are. We cannot
even get a vote.
I share my colleague's concern. I thank Senator McCain and Senator
Shaheen for bringing this important amendment forward, and I hope we
will have a vote to eliminate the wasteful money going into the USDA
inspection regime of catfish.
How many times do we need our catfish inspected? It is absurd and
time to end this waste and quit wasting taxpayer dollars.
I thank the Presiding Officer.
The PRESIDING OFFICER (Mr. Rounds). The Senator from Mississippi.
Mr. WICKER. Mr. President, I understand that Senator Wyden has
priority recognition at this time. I have been informed he does not
object to me entering into the debate at this moment.
May I proceed on this amendment?
The PRESIDING OFFICER. The Senator is recognized.
Mr. WICKER. I thank the Presiding Officer.
Mr. President, there are a couple of objectives this McCain amendment
would accomplish. For one thing, it was in the 2008 farm bill. The
current move to change the inspection from the FDA to the Department of
Agriculture is in the current farm bill, and it is about to take place,
so it would revisit the last two farm bills. I do not think we should
be doing that in a trade promotion authority piece of legislation.
Also, it is absolutely not duplicative. It can be said on the floor of
the Senate 100 times, but the fact is that the USDA Catfish Inspection
Program is not duplicative. It transfers inspection from the FDA to the
USDA and the USDA has testified before Congress that when the program
is operational, as it is about to be, the FDA program would be
eliminated.
Why move it from the FDA to the USDA? Here is the reason: There are a
few of us--under controlled situations--who grow most of the catfish
that is produced in the United States on farms, including the State of
Mississippi and the State of Arkansas.
My distinguished colleagues from Arkansas and Mississippi will speak
on this issue in a few moments, I hope.
This is about food safety for Americans in 50 States who deserve to
know that the fish they are eating--the product they are eating--is
unadulterated.
Here are the facts: Under the current FDA program, only about 2
percent of the billions of pounds of imported catfish are inspected--
only about 2 percent. The other 98 percent of this large
[[Page S3022]]
quantity come in uninspected. Now, that gives me pause as a consumer.
It should give residents of all 50 States pause that 98 percent of the
catfish which comes into our country is not inspected.
Here is what we do know about the 2 percent we look at under the FDA
program: An alarming volume of the catfish inspected by the FDA already
failed to meet standards. They failed to meet consumer safety
standards. Many overseas productions are simply not operated under the
sanitary conditions that we insist upon in the United States with our
farm-raised catfish.
The FDA program does not ensure that trade partners have sufficient
health standards nor does it inspect any overseas agriculture
operations. They don't go over to Vietnam and look at the operations
there and see the safety standards that cause the health risks.
What kind of health risks are we talking about? We are talking about
cancer. I have in my hand a page from a draft rule by the Department of
Agriculture, dated February 10, 2009. This is a draft rule from the
Food Safety and Inspection Service. It turns out--and the GAO has been
mentioned here--that the GAO got OMB to ask the FSIS to rework this
statement and make it a little softer so we would not go so hard on
imported Vietnamese catfish.
Here is what the Department of Agriculture report, which has now been
buried, says as to whether or not the Agency used random or risk-based
samplings: Applying the Food Safety Inspection Service program to
imported catfish yielded a reduction of approximately 175,000 lifetime
cancers for Americans--I want that kind of reduction from carcinogens
coming into the United States--and 0.79 percent acute toxicities. Using
random sampling in the Agency's program yielded a reduction of 91.8
million exposures to antimicrobials and 23.28 million heavy metal
exposures. We are talking about carcinogens, we are talking about
improper antimicrobials that the USDA program would catch, and over 23
million exposures to heavy metals that we don't need in the United
States. Using risk-based sampling yielded a reduction of 95.1 million
exposures to antimicrobials.
We are talking about a program that is not going to be duplicative
because it is going to move--according to the last two farm bills--from
the FDA to the USDA. This excessive government waste we have heard
about will not exist, but we will have better safety for the consumers
of the United States of America. That is why we do not need to revisit
this issue, and that is why the McCain amendment should be rejected.
That is why we should take every precaution we can to protect the
American consumer, whether in their home kitchens or restaurants.
I yield the floor. Perhaps other of my colleagues would like to
address this issue.
The PRESIDING OFFICER. The Senator from Mississippi.
Mr. COCHRAN. Mr. President, the Senate has made clear the authority
of the U.S. Department of Agriculture for imported catfish inspections.
It has been debated and resolved in two previous farm bills; first, in
2008 and again in 2014. The USDA catfish inspection is about protecting
the health and safety of American consumers. The 2008 and 2014 farm
bills required catfish inspection responsibilities to be transferred
from the Food and Drug Administration to the USDA Food Safety and
Inspection Service upon publication of final regulations.
The need for this regulatory clarification is clear: American
consumers could be exposed to dangerous chemicals and unapproved drugs
in the imported catfish they eat. According to the Government
Accountability Office, about half of the seafood imported into the
United States comes from farm-raised fish. Fish grown in confined areas
have been shown to contain bacterial infections. The FDA's oversight
program to ensure the safety of imported seafood from residues of
unapproved drugs is limited, especially as compared with the practices
of other developed countries.
According to the Department of Agriculture and other Federal
agencies, the Food and Drug Administration inspects only 1 percent of
all imported seafood products. This is just not acceptable. The U.S.
Department of Agriculture, on the other hand, inspects 100 percent of
farm-raised meat products that enter the country, which illustrates why
the Department of Agriculture is the appropriate Agency for farm-raised
catfish inspections.
Following enactment of the catfish mandate in the 2008 farm bill, the
Department of Agriculture conducted risk assessments on the dangers of
exposure to foreign agriculture drugs and determined that moving
catfish inspections under the USDA inspection system would result in a
reduction of 175,000 lifetime cancers, 95 million exposures to
antimicrobials, and 23 million heavy metal exposures.
The Catfish Inspection Program will enhance consumer safety but will
not result in duplication activities by U.S. government agencies. Upon
issuance of final regulations, catfish inspection responsibilities will
be transferred to and not shared with the Department of Agriculture.
In order to address perceived concerns regarding duplication, a
provision was included in the 2014 farm bill that required the FDA and
USDA to enter into a memorandum of understanding to establish clear
jurisdictional boundaries.
We consider that this is a time to resolve this issue and put this
matter to rest. International equivalence is a concept that originated
with the WTO and is regarded as a way to encourage the development of
international food safety standards and will help this issue to be
balanced fairly among all Members and facilitate our trade with other
countries.
I yield the floor.
The PRESIDING OFFICER. The Senator from Michigan.
Ms. STABENOW. Mr. President, I rise to speak about the Portman-
Stabenow amendment.
First, I wish to say a word in support of the efforts by Senator
Cochran and Senator Wicker. I was a partner with Senator Cochran in the
2014 farm bill. I support their position as it relates to the catfish
provision. Hopefully, we will be able to retain that provision.
Amendment No. 1299
Ms. STABENOW. Mr. President, I ask unanimous consent to add Senator
Hirono as a cosponsor of amendment No. 1299.
The PRESIDING OFFICER. Without objection, it is so ordered.
Ms. STABENOW. Mr. President, I ask unanimous consent to have printed
in the Record a letter dated September 23, 2013, signed by 60 U.S.
Senators, that calls on the administration to include strong and
enforceable currency provisions in all future trade agreements.
There being no objection, the material was ordered to be printed in
the Record, as follows:
U.S. Senate,
Washington, DC, September 23, 2013.
Secretary Jack Lew,
Department of the Treasury, Washington, DC.
Ambassador Michael Froman,
Office of the United States Trade Representative, Washington,
DC.
Dear Secretary Lew and Ambassador Froman: We agree with the
Administration's stated goal that the Trans-Pacific
Partnership (TPP) has ``high standards worthy of a 21st
century trade agreement.'' To achieve this, however, we think
it is necessary to address one of the 21st century's most
serious trade problems: foreign currency manipulation.
Currency is the medium through which trade occurs and
exchange rates determine its comparative value. It is as
important to trade outcomes as is the quality of the goods or
services traded. Currency manipulation can negate or greatly
reduce the benefits of a free trade agreement and may have a
devastating impact on American companies and workers.
A study by the Peterson Institute for International
Economics found that foreign currency manipulation has
already cost between one and five million American jobs. A
free trade agreement purporting to increase trade, but
failing to address foreign currency manipulation, could lead
to a permanent unfair trade relationship that further harms
the United States economy.
As the United States negotiates TPP and all future free
trade agreements, we ask that you include strong and
enforceable foreign currency manipulation disciplines to
ensure these agreements meet the ``high standards'' our
country, America's companies, and America's workers deserve.
Sincerely,
Lindsey Graham; Rob Portman; Debbie Stabenow; Ron Wyden;
Jeff Merkley; Christopher Murphy; John Boozman; Elizabeth
Warren; Al Franken; Jay Rockefeller; Barbara A. Mikulski;
Benjamin L. Cardin; Tom Udall; Amy Klobuchar; Charles E.
Schumer; Joe Manchin III; Robert Menendez; Heidi
[[Page S3023]]
Heitkamp; Claire McCaskill; Jeanne Shaheen; Mark Begich; Roy
Blunt; Edward J. Markey; James M. Inhofe; Jeff Sessions;
Kirsten E. Gillibrand; Saxby Chambliss; Robert P. Casey, Jr.;
Christopher A. Coons; Carl Levin; Richard Burr; Jerry Moran;
Patrick J. Leahy; Daniel Coats; James E. Risch; John Hoeven;
Jack Reed; Tom Harkin; Tammy Baldwin; Joe Donnelly; Mark
Pryor; Sheldon Whitehouse; Sherrod Brown; Susan M. Collins;
Martin Heinrich; Bill Nelson; Richard Blumenthal; David
Vitter; Bernard Sanders; Jon Tester; Angus S. King, Jr.;
Richard Durbin; Brian Schatz; Mazie K. Hirono; Pat Roberts;
Kay R. Hagan; Mary L. Landrieu; Chuck Grassley; Barbara
Boxer; Tom Coburn.
Ms. STABENOW. Mr. President, before speaking specifically to our
amendment, I wish also to indicate that there are a number of very
important amendments coming before us in this open debate process. I am
pleased we have a number of amendments pending that, hopefully, will be
offered and voted on that relate to other very important topics.
One of those topics is an amendment currently pending offered by
Senator Brown. I am pleased to be a cosponsor of that amendment. It
will clarify the process for new countries to join the Trans-Pacific
Partnership and to ensure that additional countries, including China,
cannot join the agreement without congressional approval. So I hope we
will get a vote on that amendment, which is certainly part of this
whole discussion on currency manipulation when we look at Asia, when we
look at Japan now, and when we look at China. This is an important
amendment.
I also wish to indicate that I have terrific respect for the chairman
of the Finance Committee. I wish to address an amendment that I believe
will be offered as a side-by-side to the Portman-Stabenow amendment. I
urge colleagues to reject what is essentially nothing more than a
rewrite of pretty much the same weak language that exists in the
underlying bill. It changes some words around. It basically would not
put us on record as 60 Members of the Senate to make sure we have
enforceable currency provisions in this trade agreement moving forward.
At this point in time, when we look at currency manipulation, it is
the most significant 21st century trade barrier there is. To quote the
vice president of international government affairs for Ford Motor
Company in the Wall Street Journal:
Currency manipulation is the mother of all trade barriers.
We can compete with any car manufacturer in the world, but we
can't compete with the Bank of Japan.
We want our businesses and we want our workers to have a level
playing field in a global economy. When we are giving instructions--
when we are giving up the right to amend the Trans-Pacific Partnership
through this fast-track process involving 40 percent of the global
economy--we have the right and obligation to make sure we have a
negotiating principle in there. We are not mandating exactly what it
looks like. We are just applying a negotiating principle that addresses
the No. 1 trade barrier right now to American businesses, which is
currency manipulation. By some estimates, it has cost the United States
5 million jobs. If we don't address it in this reasonable way, it will
cost us millions more.
Our people, our workers, and our businesses are the best in the
world. We know that, but they have to have a level playing field.
Currency manipulation is cheating--plain and simple. A strong U.S.
dollar against a weak foreign currency, particularly one that is
artificially weak due to government manipulation, means that foreign
products are cheaper here and U.S. products are more expensive there.
One U.S. automaker estimates the weak yen gives Japanese competitors
an advantage of anywhere from $6,000 to $11,000 in the price of a car,
not because of anything they are doing other than cheating by
manipulating their currency. It is hard to compete with those kinds of
numbers: $6,000 to $11,000 difference in the price of an automobile. At
one point it was calculated that one of the Japanese company's entire
profit on a vehicle was coming from currency manipulation.
Frankly, this is not about competing between--the U.S. going into
Japan--that has also been a red herring. It is about the United States
and Japan competing against each other in a global economy for the
business of the developing countries. For instance, we are talking
about Brazil having 200 million people. We are competing for that
business. India has a population of 1.2 billion people. We are
competing--Japan and the United States--for everything in between,
everything else. That is what this is about, and it is about whether
they are going to continue to be able to cheat.
Also, it is not just the auto industry. It is other manufacturers, as
well. This is also about companies that are making washing machines or
all kinds of equipment or refrigerators and all of the other products
that we make and create using good middle-class jobs here in America.
It also affects agriculture. Anything that impacts the distortions in
the economy affects agriculture and every other part of the economy.
So what we are asking for is something very simple and
straightforward--very simple--which is that just as we have negotiating
objectives in the TPA fast-track for the environment, for labor
standards, and for intellectual property rights, we should have a
negotiating objective that is enforceable regarding currency
manipulation. We are not suggesting what that would look like in a
trade agreement, any more than we are specifying exactly what the other
provisions would look like. We are saying it is important enough that
if we are giving up our right to amend a trade agreement--we are giving
fast-track authority--currency manipulation is the No. 1 trade
distortion, trade barrier right now in terms of the global marketplace,
so we should make sure there is a negotiating principle there. We also
say that it is consistent with existing International Monetary Fund
commitments and it does not affect domestic monetary policy.
I have heard over and over that somehow what we do through the Fed is
impacted. That is not accurate. We are looking, in fact, at over 180
countries that signed up under the International Monetary Fund, saying:
We won't manipulate our currency. Yet, even though that has happened--
we have seen, in fact, in the case of Japan, for the last 25 years,
they have manipulated their currency 376 times. We should say enough is
enough.
Now, I also understand we are hearing from the administration. By the
way, I am very supportive of their efforts, this current
administration's time on trade enforcement efforts. They have won a lot
of excellent cases. I wish to commend them for that. I disagree with
them on this one position, because they are saying, first of all, that
Japan is no longer manipulating their currency--the Bank of Japan. OK,
fine. The administration says if we put a negotiating objective into
fast-track authority, Japan will walk away. Why would they walk away if
they are not doing it anymore? Maybe they want to do it again right
after we sign the TPP. Maybe they will do it again, and it will be 377
times. If they aren't doing it anymore, why should they care? It makes
no sense.
Either we can trust them and they are no longer manipulating their
currency or we can't trust them and we need this provision. It can't be
both. Right now, what they are talking about makes no sense. Again, we
are not talking about domestic policy; we are talking about direct
intervention in foreign currency markets, and that if there is direct
intervention in foreign currency markets, we would like to see
meaningful consequences that fit with the IMF definitions that
countries have all signed up for saying they will not manipulate their
currency and that it should comply with WTO enforcement, as we do for
every other trade distorting policy, every other trade barrier.
This is actually very straightforward. I am very surprised that it
has not been accepted. Frankly, I would have gone further. In the
Finance Committee I had an amendment I would love to do which says that
TPP doesn't get fast-track authority unless it is clear that there are
strong, enforceable provisions on currency in the agreement. This
doesn't say that. This is a reasonable middle ground to say, for the
first time, that currency manipulation is important, it is a
negotiating principle, and we leave flexibility in terms of how that is
designed, just as we do with other provisions.
We have strong bipartisan support for this amendment. I wish to thank
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Senators Brown and Warren, Senators Burr and Casey and Schumer,
Senators Graham, Shaheen, Manchin, Klobuchar, Collins, Baldwin, Hirono,
Franken, Menendez, and Heitkamp for understanding and supporting this
amendment. We have other support as well. I wish to thank Senator
Graham. He made a comment, because we care deeply--we were so pleased
to get the Schumer-Graham-Brown-Stabenow and others' efforts in the
Customs bill related to China and currency, which is so important and
which we also need to get all the way to the President's desk. But we
know that if we don't put language in the negotiating document we give
to the White House, then we are not really serious. Senator Graham
said: This amendment is the real deal. That is firing with real
bullets.
So if we are serious, if the 60 people who signed the letter are
serious--and I hope and believe we are--then we need to make sure the
negotiating position we take is to ask--and to direct--the
administration to put this in the final negotiations on TPP.
We have, as I mentioned before, enforceable standards language on
labor and environment and intellectual property rights. This is not
complicated. We need to make sure we are clear on currency
manipulation. The IMF has rules about what is and what is not direct
currency manipulation. They are clear rules. There are 187 countries,
in addition to Japan, that have already signed up saying they will
abide by that definition. We just don't enforce it, and we have lost
millions of jobs. Again, Japan, after signing, has intervened--the Bank
of Japan has intervened 376 times in the last 25 years. We are being
asked to rely on a handshake and good-faith assurances that there won't
be 377 times. But we are being told if we even put language requiring a
negotiating principle into this document, that somehow Japan will walk
away. This makes absolutely no sense whatsoever. We have a
responsibility, if we are giving up our rights to amend a document, to
amend a trade agreement. If we are giving up our rights to require a
supermajority vote in Congress, if we are doing that, we have a
responsibility to the people we represent to make sure we have given
the clearest possible negotiating objectives to the administration as
to what we can expect to be in a trade agreement. That is what TPA is
all about. If, in fact, currency manipulation is the mother of all
trade barriers, why in the world would we not make it clear that
currency manipulation should be a clear negotiating objective for the
United States of America?
Let me just say again that we can compete with anybody and win. Our
workers, our businesses, our innovation can compete with anybody and
win. But it is up to us in Congress, working with the White House, to
make sure the rules are fair. I hope colleagues will join us in passing
the Portman-Stabenow amendment to make it clear we understand in a
global economy what is at stake and that we are going to vote on the
side of American businesses and American workers.
Thank you, Mr. President.
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