[Congressional Record (Bound Edition), Volume 145 (1999), Part 18]
[Senate]
[Pages 26586-26592]
[From the U.S. Government Publishing Office, www.gpo.gov]



         AFRICAN GROWTH AND OPPORTUNITY ACT--MOTION TO PROCEED

  The PRESIDING OFFICER. Under the previous order, the Senate will now 
resume consideration of the motion to proceed to H.R. 434, which the 
clerk will report by title.
  The bill clerk read as follows:

       Motion to proceed to the consideration of H.R. 434, an act 
     to authorize a new trade and investment policy for sub-
     Saharan Africa.

  Mr. ROTH. Mr. President, I rise in support of the motion to proceed 
to H.R. 434. As Senator Grassley, chairman of the Finance Committee's 
Trade Subcommittee, indicated last night, I will offer a manager's 
amendment--to be titled the Trade and Development Act of 1999--as a 
substitute for the House-passed language.
  That act will include the Senate Finance Committee-reported bills on 
Africa, an expansion of the Caribbean Basin Initiative, an extension of 
the Generalized System of Preferences, and the reauthorization of our 
Trade Adjustment Assistance programs. I want to explain the intent 
behind these measures and my reasons for supporting their passage.
  Let me begin with Africa. No continent suffers more from poverty, 
hunger, and disease. Those problems have been compounded by 
colonialism, cold war politics, corruption, social division, and 
environmental disaster. Our daily news records the desperate images of 
starving mothers and their children, small boys employed as the dogs of 
war, and the slaughter of wildlife as poachers attempt to eke out a 
living on the bare plains of Africa.
  The result has been the lowest living standards and the lowest life 
expectancy of any in the world. Those conditions have too often 
reinforced a dangerous cycle of war, political instability, and 
economic decay.
  What the daily news has too often overlooked are the efforts of so 
many of our African neighbors to restore political freedom, guarantee 
human rights, and foster economic hope.
  In the past decade, we have seen an end to apartheid in South Africa 
and the peaceful transition to black majority rule. We have seen Nelson 
Mandela go from political prisoner to president.
  We have witnessed the more recent restoration of economic links 
between South Africa and the former ``front-line states,'' between 
Uganda and Tanzania, and between the sub-Saharan region and the rest of 
the world. We have benefited from the example of courage and dedication 
that many sub-Saharan African states have provided as they have 
confronted the daunting challenges they face.
  We have also seen nothing short of a revolution in economic thinking. 
Africa has too frequently been the beneficiary of bad economic advice 
from well-meaning international institutions, technical advisers, and 
even creditors.
  That advice often encouraged crushing debt, confiscatory taxation, 
growth-killing devaluations, inefficient state-owned enterprises, and 
economic mismanagement. For too long, our African neighbors have been 
encouraged to adopt models of economic development that have, in fact, 
wasted their most valuable resource--their people.
  That era has now come to an end. The new Africa is tackling its own 
problems and the new Africa can be the master of its own economic 
destiny.
  It is in that context that the African title of the Trade and 
Development Act is relevant. It offers tariff preferences to sub-
Saharan Africa that will encourage economic foundation on which the 
eligible countries can build their own future. Equally important, it 
reflects a belief in the power of markets, incentives to investment, 
and human potential.
  That approach enjoys broad bipartisan support in both Houses of 
Congress and by the President, who mentioned the bill as one of his top 
foreign policy and trade priorities in this year's State of the Union 
Address. As the chart behind me attests, the legislation also enjoys 
broad support in the business community, among U.S. and foreign opinion 
leaders, as well as, most importantly, from the potential African 
beneficiaries themselves.
  Numerous U.S. businesses and business groups have expressed their 
support for moving this legislation. That group includes companies as 
diverse as Oracle, Cargill, General Motors, Enron, and The Limited.

[[Page 26587]]

  The list of supporters includes the NAACP, the Southern Christian 
Leadership Conference, and the National Council of Churches. It 
includes opinion leaders such as Nelson Mandela, Coretta Scott King, 
the Reverend Leon Sullivan who led much of the fight in this country to 
force change in South Africa under apartheid, and Robert Johnson, the 
founder of Black Entertainment Television who appeared before the 
Finance Committee in support of the legislation. And, most importantly, 
the legislation is endorsed by all 47 of the potential beneficiaries in 
sub-Saharan Africa.
  The bill deserves our support as well.
  The Trade and Development Act of 1999 would do much the same of the 
Caribbean and Central America that it would do for sub-Saharan Africa. 
It expands the existing benefits available under the Caribbean Basin 
Initiative to include the duty-free and quota-free treatment of the 
value added in the Caribbean to apparel made from U.S. yarn and U.S. 
fabric.
  It is no understatement to say that the countries of the Caribbean 
and Central America have faced problems similar to those faced in 
Africa, and often-times on a similar scale. It was only a decade or so 
ago that Nicaragua was an avowedly Marxist state harboring guerrillas 
that sought to undermine the governments and economies of Central 
America. It was only a decade or so ago that El Salvador was confronted 
with bloody civil strife and a mass migration of its people northward 
to escape the conditions of poverty and hopelessness that recurring 
civil war had brought.
  More recently, the region has been hit by natural disasters, rather 
than the man-made variety. This past year, Hurricane Mitch devastated 
the islands of the Caribbean and the countries of Central America. 
Among the hardest hit were Honduras and Guatemala, where farms and 
factories were literally washed away overnight. Both countries 
confronted the need to rebuild their economic infrastructure from the 
ground up.
  Since 1983, the countries of the region have been eligible for 
enhanced tariff preferences under the Caribbean Basin Initiative. The 
CBI was expressly designed to encourage private investment and an 
economic partnership between the firms in the United States and firms 
in the Caribbean. The CBI accomplished that objective.
  In 1993, however, with the conclusion of the NAFTA, the margin of 
preference enjoyed by the CBI beneficiaries was undercut by the 
preferential treatment accorded Mexican goods under that agreement. 
That was particularly significant in the area of textiles and apparel, 
where the NAFTA rules of origin gradually encouraged a shift in United 
States investment and trade from the region to the Mexico.
  In order to make good on the initial promise of the CBI, the 
Caribbean title of the manager's amendment would encourage the 
manufacture in the Caribbean of apparel articles made from U.S. fabric 
woven with U.S. yarns. In effect, the bill would simply restore the 
margin of preference it previously enjoyed in the region in such 
manufacturing.
  At this point, it is worth outlining the reasons why the Finance 
Committee settled on the particular package of benefits extended to 
textiles and apparel under both the Africa and CBI titles of the 
manager's amendment.
  For many years, we have employed a program that encouraged production 
sharing between the United States and many countries in the developing 
world. That program--generally known as the ``807'' program--allowed 
for the export of U.S.-manufactured components off-shore for assembly.
  Under the 807 program, when the assembly was complete and the goods 
were returned to the United States, the importer paid duty only on the 
amount of value added offshore in the assembly process.
  Do such programs work? The answer, based on the latest reports of the 
International Trade Commission, is an unequivocal yes. They work for 
both the beneficiary countries and for American firms.
  Production sharing programs, according to the ITC, are used by 
American companies ``to minimize their overall costs and improve 
competitiveness.'' Indeed, in most instances, American firms experience 
``enhanced overall competitiveness'' that ``allows companies to 
maintain higher U.S. production and employment levels that might 
otherwise be possible.'' In short, the programs reflected in both the 
Africa and CBI titles of the manager's amendment are designed to create 
a ``win-win'' outcome for the regions and for American firms.
  The American textile industry's latest analyses vindicate the 
approach we adopted in the Finance Committee.
  I think it is fair to say that when we started the process of 
considering these programs for Africa and the Caribbean in the 105th 
Congress, the textile industry was lukewarm at best. What they have 
found in the intervening three years is that the bill proposed by the 
Finance Committee would help create a competitive platform from which 
American firms could compete effectively on a global basis even in the 
face of fierce competition from exporters such as China and India.
  According to the respected industry consultant, Nathan Associates, 
the Finance Committee bill would ``increase U.S. textile shipments by 
$8.8 billion and increase U.S. textile and textile-related employment 
by 121,400 by the end of five years.''
  That result led the president of the American Textile Manufacturers 
Institute, Doug Ellis of Southern Mills, to conclude that the Senate 
Finance Committee bill would have a ``very strong and direct positive 
impact . . . on U.S. textile production and jobs.'' He indicated that 
the legislation will ``significantly enhance'' trade between the United 
States and the beneficiary countries. For that reason, ATMI, urged the 
Congress to support the Finance Committee's bill.
  What is more, U.S. wholesalers, retailers, and consumers benefit as 
well. The direct effect on the duty preferences extended under the 
manager's amendment will be to lower the cost of apparel products sold 
in the United States as cost savings are passed on to the consumer.
  The indirect effect is that, by ensuring the continuing 
competitiveness of the U.S. industry, the bill would also encourage 
continuing competition well into the future. That competition 
ultimately means a broader range of higher quality goods available to 
the consumer at lower prices.
  I want to pause here to reemphasize my basic point. Under the 
manager's amendment, everyone in the U.S. textile and apparel market--
from the farmer growing cotton to the yarnspinner to the fabric-maker 
to the apparel manufacturer to the retailer to the consumer--wins under 
the Finance Committee bill. The same holds true for the beneficiary 
countries.
  Now, I would be remiss if I failed to mention two other particularly 
important provisions of the manager's amendment. The first is the 
renewal of the Generalized System of Preferences. The GSP program 
lapsed in June of this year. Much depends on its renewal.
  The program was designed to create an incentive to investment in the 
developing world. Since its inception in 1975, the GSP program has done 
just that. Now, however, in the absence of the renewal of the program, 
that needed incentive to productive capital investment will be cut off. 
Many American firms that depend on the GSP program will be hurt along 
with the beneficiary countries.
  The second additional item is the reauthorization of the Trade 
Adjustment Assistance programs. The TAA programs are designed to help 
U.S. workers and firms adjust to new levels of import competition.
  I have always maintained that those that benefit from trade should 
care for those who are hurt by the economic adjustment trade can 
engender. For that reason, I rushed to the floor to object when there 
was an initiative to do away with these programs in the past. In my 
view, the TAA programs represent a down payment on the commitment we 
must make to workers as the United States if we want them to join us in 
support of the benefits trade brings.
  In closing, let me urge my colleagues to listen carefully to the 
debate they

[[Page 26588]]

will hear in the coming hours on the motion to proceed to H.R. 434. I 
firmly believe that my colleagues will hear no meaningful objection to 
the Senate Finance Committee's approach to providing additional trade 
incentives to sub-Saharan Africa, the Caribbean, or the developing 
world generally through the renewal of GSP. Nor can there be any 
principled objection to the renewal of the TAA programs.
  This is a significant step in favor of engagement with our neighbors 
in Africa and the Caribbean to help them surmount their own economic 
problems. I urge my colleagues to vote for the motion to proceed to the 
bill.
  The PRESIDING OFFICER. The Senator from Washington.
  Mrs. MURRAY. I thank the Chair.
  (The remarks of Mrs. Murray pertaining to the introduction of S. 1772 
are located in today's Record under ``Statements on Introduced Bills 
and Joint Resolutions.'')
  Mrs. MURRAY. I yield the floor.
  The PRESIDING OFFICER (Mr. Gorton). The Senator from South Carolina.
  Mr. HOLLINGS. Mr. President, on the objections I have registered to 
the motion to proceed to the CBI/sub-Sahara bill, I was delighted to 
hear the chairman of our Finance Committee relate the reason for it. 
The reason, perhaps, is well-founded: good foreign policy.
  I have sponsored and recommended some kind of Marshall Plan for the 
country of Mexico for the simple reason that Mexico is our neighbor; it 
is our friend. We have a responsibility to assist it, and we are 
responsible for the problems NAFTA has caused, which are quite obvious 
with respect to immigration and drugs. If we can put in a plan where 
Mexican workers can have workers' rights and some money in the economy 
would not be stripped and sent back to the bankers in New York or to 
the investment wizards from all the other countries, including the 
United States--you can cross from California into Tijuana, Mexico; one 
would think you were in Seoul, Korea. If we could do that, we could 
have some prosperous parity with our friends in Mexico.
  Unfortunately, we went the so-called NAFTA way. We have had 
approximately 5 years to measure the success or failure of NAFTA. 
Everywhere I go I hear: Oh, isn't it wonderful how well it has worked.
  The truth is, they told us in the original instance this was going to 
create jobs in America, just as the distinguished Senator from Delaware 
is telling me this bill is going to create jobs in the United States.
  It is a win-win situation, he says, from the farmer to the apparel 
manufacturer. And he goes down the list: What a wonderful win-win 
situation it is.
  I do not advise that he come to South Carolina and tell them that, 
where they have lost 31,700 textile jobs since NAFTA. They are 
streaming out. Why? Because you and I, Mr. President, set the American 
standard of living. That is a bipartisan effort whereby we all agree on 
a minimum wage, Social Security, Medicare, Medicaid, safe working 
place, safe machinery, plant closing notice, parental leave, clean air, 
clean water--on down the list. We can continue to list Republicans and 
Democrats joining in setting our highest standard of living.
  Obviously, it is competing with one of the lower standards of living. 
You can go down to Mexico for 58 cents an hour. There are none of those 
protections. You are guaranteed a profit. And everybody is streaming 
down there.
  But we are losing jobs not just in South Carolina but all over the 
Nation. The overall job loss is in the textile and apparel sector over 
the last twenty five years is some 1.2 million, and 420,000 of them are 
textile jobs since NAFTA. They said we were going to get 200,000 new 
jobs. We have lost 420,000. They said, oh, it was going to solve the 
immigration problem. I know better--by handling the immigration 
appropriations--there is the Border Patrol, and how we are breaking out 
abandoned Navy yards and using schools, and having thousands of 
additional agents, and everything else of that kind, and illegal 
immigrants keep coming. The immigration problem is worse today than it 
was 4 or 5 years ago.
  Drugs? Heavens above. There is a drug culture. You have to break it. 
You don't break it with NAFTA. It is worse today than it was 4 to 5 
years ago. Even the Mexican worker is taking home less pay than he was 
taking home 5 years ago.
  So there is no education in the second kick of a mule. When they come 
around and say, let's spread this NAFTA approach elixir and spread that 
down to the rest of the countries over to the sub-Sahara, or any 
elsewhere else in the world, we say, now, wait up.
  Of course, if you listen to my distinguished colleague, he talks 
about the 48 sub-Sahara African countries. Certainly they are for it. 
They are for foreign aid. The retailers and wholesalers, and so forth, 
they get lower costs. Yes; there isn't any question about that. You can 
produce it for 58 cents an hour--no clean air, no clean water, child 
labor, and everything else of that kind in these countries abroad. That 
is a given, known fact. We have college students, who know better, 
demonstrating against that. Everybody knows it. We want to make it an 
official policy?
  They say: From the farmer to the apparel manufacturer, and on, it is 
a win-win situation. Well, of course, unfortunately, it is a losing 
situation. As I have indicated, we have been through this singsong.
  It started some 40 years ago or more with Japan. I will never forget, 
at the particular time I was a young Governor in South Carolina, they 
said: Now, Governor, what do you expect these emerging countries to 
make? The airplanes and the computers? Let us make the airplanes and 
computers, and let them make the textiles, the clothing, and the shoes.
  The trouble is, 40 years later, with our noncompetitive blind kind of 
foreign trade policy, they are making the shoes, they are making the 
textiles, they are making the airplanes, they are making the computers, 
they are making everything. When we get into full debate on Monday, we 
will point out and list down exactly what has been going on and how we 
have been hollowing out the industrial strength of America.
  Last evening, we had a delightful exchange with the ranking member of 
our Finance Committee, the senior Senator from New York, Mr. Moynihan. 
He was relating back to when he was on the Kennedy team negotiating the 
trade policy, which was an outstanding policy at the time. It was 
outstanding in that it was realistic.
  President Kennedy knew the situation. I went and showed how we 
brought the witnesses, and everything else, and found that textiles was 
second only to steel as the most important to our national security. 
And with that authority under the law, President Kennedy enunciated his 
seven-point textile program, from which came the Kennedy Round, the 
Multi fiber Arrangement, One Price Cotton; and it gave a chance--yes, 
to sort of an archaic industry--to really refurbish, retool, modernize, 
and compete.
  Until the recent years, like NAFTA, they had been putting in $2 
billion a year, at least $2 billion a year, in the State of Delaware, 
the State of South Carolina, and the several other States to modernize 
and compete.
  I went to a plant there in Clinton, for example--I went to numerous 
ones last year--but this was an old plant, over 100 years old, that 
looked to me as if it was going to fall down. But I was pleasantly 
surprised when I walked in. They had the most modern machinery and the 
highest productivity you could possibly imagine.
  There isn't any question that the industry has been brought into the 
world of reality of so-called global competition. The only trouble is 
that our competitors are fancy-free and footloose with their 
protections, with their nontariff trade barriers, and other measures to 
protect their economic strength, and we are blindly pell-mell down the 
road with this so-called free trade, free trade, when, of course, it is 
obviously not free.
  That goes back now to the standard of living we talked about. And 
more

[[Page 26589]]

than the standard of living--if this passes because it will change what 
we said with the Multi fiber Arrangement just 5 years ago after GATT/
WTO: That we were going to have a phaseout of any kind of quotas.
  I know the distinguished Chair knows about subsidies. We have done 
all the research, just about, for the aircraft industry. We give them 
Export-Import Bank financing. We do not do that for textiles. We do not 
do that for textiles.
  But I see all of these people come out for the farmer. Yes, I had to 
talk to a farmer friend yesterday. I support the farmers. I support 
that aircraft industry. The farmers, they get subsidized water, 
subsidized telephones, subsidized electricity. They get export 
subsidies. If it rains, they get protection; if it dries up, they get 
protection.
  And Oracle. The Senator from Delaware says: Oracle is with us. That 
is that crowd with whom we started the Internet. You would think, by 
gosh, they invented it. The politicians, the Pentagon, we did all of 
that back in 1967, 1968, 1969. We put in, at the University of Illinois 
and Stanford, the training programs for which ultimately benefited Mr. 
Yang of Yahoo and other Internet start-ups. And so fine, our friend 
Gates, he has 22,000 employees, and there are approximately 22,000 
millionaires. There was nothing wrong with that. But don't talk about 
the engine of this prosperity and economy as this crowd. No, sir.
  We go back to Henry Ford when he said, in order to sell his car: I 
want to make sure the person producing it is making enough to buy it. 
He started generating, more than anyone, just with Ford automobiles, 
the middle class in America. General Motors, compared to those 22,000, 
has 250,000. We had that machine tool industry, and we had all the rest 
of these good manufacturing establishments, but we have gone to 
software, which doesn't help us in our exports nearly as much as the 
heavy manufacturers. And it is not the engine. It is the hard 
industries that are the engine of our economy.
  When you give me Oracle and Exxon and the rest of them on this 
particular bill, and foreign policy, obviously they are trying to 
explore oil in the sub-Sahara. They are trying to sell their goods 
anywhere else in the world and, of course, in Central America. But 
right to the point, this is the sort of last chance we have for a 
formative industry, second-most in importance to our national security. 
It is the last chance in the sense that after 5 years of the 10-year 
phaseout, the textile manufacturers all invested in that 10-year 
policy. So if we cut it off in October of 1999, cut it off at least 5 
years short, they begin to lose the investment. They don't get the 
return. They don't increase their productivity.
  I never heard such an outrageous statement, that this is going to 
increase their productivity. They immediately freeze in their tracks 
and say, no, we can't get our money back out of trying to, even again, 
buy a better spindle and get even a higher production. They begin to 
lose their money as well as the workers lose their jobs. It is a lose-
lose situation because, bottom line, look what happens.
  Like I say, all these other countries invest down there in the 
various Central American countries. Honduras, seven Taiwan firms, 
including the leading Chung hsing Textile have invested $24 million. 
Again, the Republic of China will provide $15 million in low-interest 
loans for Honduras to build an export processing zone, an EPZ. Then the 
Taiwan manufacturers in the upper and lower streams of the textile 
industry are planning to form integrated textile production in San 
Pedro Sula down in Honduras and Central America. The South Koreans, Kim 
and Arzu, have agreed on the need to diversify South Korean investment 
in Guatemala and their particular textile investments down there.
  Looking at the Caribbean as a potential staging ground and production 
base, the Malaysian textile industry uses Caribbean plants as the 
gateway to the United States. Then again some 18 Taiwanese companies 
are down there. South Korea, 180 small South Korean companies, mostly 
textile and garment makers, have invested $130 million in five Central 
American nations. You can go right on down the list.
  I am going to get in the Record on Monday the 100,000-acre tract the 
People's Republic of China, Beijing, developed--that industrial tract--
down in Mexico. So it isn't somehow that we are opening it up for 
American fabric. Yes, temporarily that ATMI crowd, they thought they 
could just hold on to American fabric, but Burlington has found 
differently. They have moved down and other fabric manufacturers are 
moving. Why? Because it is cheaper in Mexico.
  When it comes right down to it, it might be a good aim but it is a 
bad recoil. We learned that with the artillery in World War II. No 
matter how well the gun was aimed, if the recoil is going to kill the 
guncrew, don't fire. That is why we object to proceeding to this 
particular bill--because the recoil here is going to kill this 
important industry.
  I will be glad to get into it in depth when we have all the Members 
back here the first part of the week. Of course, the President, yes, he 
is building a library now, and he is looking to see what he did down in 
Central America and what he did in Africa and traveling around building 
a library. But he is absolutely draining, so to speak, the industrial 
strength in the United States of America. It is a sad thing to see that 
more people are not exercised about it. This has been going on for 
years on end. President Kennedy was worried, and that is why he put in 
his seven-point program when only 10 percent of the textile apparel 
consumed in the United States were represented in imports.
  Now I am looking at at least two-thirds--nearly 70 percent of the 
clothing I am looking at in this Chamber is manufactured outside the 
United States; and, of course, the shoes, 86 percent of the shoes on 
the floor. But it has gone on to cameras and hand tools and everything 
else.
  Just earlier this year we found out about steel. The World Bank runs 
around and says, wait a minute, in order to become a nation state, you 
have to have the steel for the tools of agriculture and the weapons of 
war. So the World Bank gives these 2-percent loans, all over the entire 
world, down through Africa, into the Middle East, Saudi Arabia and 
Iran, now to the People's Republic of China. So they get an 
overproductivity of steel, and they come dumping it here. And we are 
telling them, let us get more competitive. You have to look at these 
broad policies. You have to look at this broad foreign policy that the 
Senator from Delaware now enunciates and how wonderful it is that we 
are going to make friends in the sub-Sahara and down in Central 
America.
  I think the Koreans, the Malaysians, the Taiwanese, the Japanese, and 
everyone else will be making the friends. They are quicker, faster; 
their countries subsidize, finance. They have followed the MITI form, 
not the American capitalistic form, but the controlled capitalism of 
the Ministry of Industry and Trade in the country of Japan.
  That said, I yield the floor.
  The PRESIDING OFFICER. The Senator from Delaware is recognized.
  Mr. ROTH. Mr. President, first, let me make the observation that 
textile jobs are being lost to China and India, not to Mexico. NAFTA 
has helped increase U.S. textile shipments. But I think it is 
particularly important to understand that it is not I who is saying 
that the legislation before us will help the textile industry; rather, 
it is the textile industry itself. It is the President of the American 
Textile Manufacturing Institute that is telling us that the Finance 
Committee will raise textile shipments by $8.8 billion over the next 5 
years. That is what is significant, Mr. President--that it is the 
textile industry itself that is asserting that the legislation before 
us will help the textile industry to the tune of $8.8 billion and, most 
important of all, it will increase employment by 121,000 jobs.
  That is the reason I made the comment that it is win-win because we 
are not only helping the countries such as the sub-Saharan Africa CBI, 
but we are helping the workers here at home. We

[[Page 26590]]

are not talking about what happened in the past; we are talking about 
what will happen in the future. And what we are seeking to do is to 
enact legislation that will both create jobs and help the industry. I 
should also point out, most importantly, it will be of benefit to the 
retailers, the wholesalers, as well as the people who acquire the 
goods. So I reiterate what I said earlier, that this is good 
legislation. It accomplishes what I think we all want--a stronger 
economy in the textile area.
  Now, on the immigration issue, my distinguished colleague says NAFTA 
hasn't helped. What that statement overlooked is the strong flow of 
illegal immigration. But, again, as I said earlier, it is not from 
Mexico; rather, it is from Central America and the Caribbean, which is 
precisely the reason that the Finance Committee bill will help. In 
other words, by strengthening their economy, there will be jobs there, 
and as a result of that, there won't be the need for the illicit 
immigration that has occurred in the past.
  As to who would benefit, my distinguished colleague cannot possibly 
claim that Korean and Taiwanese firms will benefit. As I explained 
before, the only fabric that will benefit is American fabric. It is 
U.S. textiles that will benefit and U.S. export of textiles. So my 
colleague argues that we are losing in manufacturing. In fact, it is 
increasing, and that is the purpose of this legislation.
  Mr. President, I think it is important that the record reflect what 
has happened to productivity in the textile industry.
  In a CRS report for Congress dated August 24, 1999, the point is made 
on page CRS-3 that:

       Labor productivity growth in the textiles industry has 
     actually outstripped [I think that is important] that of the 
     economy as a whole, increasing at 2.8% per year from 1970 to 
     1996, compared with 1.2% per year for the aggregate economy.

  In other words, the economy as a whole, its productivity, has been 
growing at the rate of 1.2 percent per year, whereas the textile 
industry, in contrast, has been growing as rapidly as 2.8 percent.
  Textile productivity growth was fast even compared to the rest of the 
manufacturing sector.
  The figures are given that it grew at 2.8 percent versus 2.3 for the 
rest of the manufacturing sector and has maintained the high growth of 
labor productivity even in the 1990s. Again, it is 4 percent versus 3.5 
percent.

       Much of the increase in the textile industry productivity 
     was due to capital deepening that occurred beginning in the 
     1970s. Over this decade, capital expenditures by textile 
     producers outstripped their profit with almost $3 billion 
     invested annually in new plants and equipment.

  The same publication points out that exports have grown 12.1 percent 
in the textile sector from 1989 to 1996 but has shrunk very slightly, 
1.2 percent, since 1997 due primarily to lingering effects of foreign 
currency devaluations that have been induced by the Asian crisis.
  I urge anyone who has an opening statement or comment on the 
legislation to come down to the floor as soon as possible while there 
is an opportunity to speak on this matter.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative assistant proceeded to call the roll.
  Mr. ROTH. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. ROTH. Mr. President, I want the record to be clear that this 
Government has been of help to the apparel and textile industry, as 
well as others, including agriculture and aerospace. The claim was made 
that the A&T sector has not benefited, but that is not correct. Let me 
give one example.
  The question of the R&E tax credit--a most important credit in that 
it encourages research by various industries and I think helps keep us 
on the cutting edge of technology--I point out this is a matter, as a 
matter of fact, being discussed and debated in the Finance Committee 
and the Ways and Means Committee on the other side as part of 
extenders.
  The point I want to make is the R&E tax credit is of great benefit to 
the textile and apparel industry. As a matter of fact, the CRS report 
for Congress of August 24, 1999, states that the R&E tax credit may be 
even more important to the A&T sector. This is probably because more 
technology-intensive industries consider R&D spending a fixed cost of 
their sector activity that must be undertaken to maintain 
competitiveness regardless of public policy. While in the A&T sector, 
the amount of R&D engaged in is variable depending on the expense. It 
concludes, for these reasons, this credit is probably of more benefit 
to this industry than many others.
  I conclude by saying that as Congress has recently displayed a 
preference in favor of tax credits over direct funding for R&D, the 
future of the R&D tax credit may be determined, to a large degree, by 
the rate of continued technical progress in the A&T sector.
  Mr. President, I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Frist). The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. WELLSTONE. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. WELLSTONE. I thank the Chair.
  Mr. President, I start out by saying this debate over S. 1387 and S. 
1389 is probably a debate we should not be having now. I think the 
Senate has far more important issues to deal with--having to do with 
the minimum wage and the standards for working people, having to do 
with giving consumers more protection through HMO or managed care 
reform, having to do with campaign finance reform and the ways in which 
money has subverted our representative democracy. And, believe me, if, 
in fact, cloture is invoked and we go forward with this bill, I will 
argue the farm crisis. I will have an amendment to this bill that will 
call for a moratorium on these acquisitions and mergers taking place 
that are driving our producers off the land.
  These are the issues people care about in our country. My question 
is, When are we really going to be debating these issues on the floor? 
I think that is what we should be doing.
  Having said that, however, I think the debate over CBI and African 
trade bills could be useful and enlightening because I think we have a 
choice between two very different models.
  Senator Feingold has introduced a very impressive and innovative 
bill. It is based on legislation introduced in the House by Jesse 
Jackson, Jr., which really blazes a trail for U.S. trade policy. It is 
truly groundbreaking. And for those people who want our trade policy to 
work for working families, this is the direction in which we should go.
  I do not think we are going to have a debate between people who are 
saying we ought to build a wall on our borders and we should not be 
involved in trade. For me, that is not the issue. The issue is not 
whether we expand trade; the issue is on whose terms we expand trade. 
What are the rules and who benefits from the rules?
  The choice could not be clearer. The Feingold-Jackson legislation, 
called the HOPE for Africa Act, says that an expansion of trade should 
benefit working families and poor families in America and in Africa. 
Trade agreements should be about making the global economy work for 
working people in all countries. The HOPE for Africa bill says if we 
are really serious about raising labor and environmental standards 
across the globe, then we have to have enforceable protections built 
into our trade agreements. The HOPE for Africa bill says that we can't 
be serious about wanting to help African countries develop economically 
if we don't do anything about the crushing debt burden. The HOPE for 
Africa bill says the lives of Africans suffering from AIDs are far more 
important than the monopoly profits of foreign pharmaceutical 
companies. The HOPE for Africa bill has its priorities straight. It 
expands trade the right way by putting people first.
  Our other option is the same old more of the same, more NAFTAs, NAFTA 
for the Caribbean, NAFTA for all of South America, NAFTA for Africa, 
more IMF-style economic policies

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that have impoverished one country after another all over the world, 
more investment protections for multinationals to export jobs overseas 
so they can avoid complying with American-style labor and environmental 
standards.
  I think we should have learned our lesson from NAFTA. We have gained 
jobs; we have lost jobs, but that is almost beside the point. The kind 
of labor, environmental side agreements we put into effect were an 
afterthought. They were not part of the trade agreement. They weren't 
enforceable. Basically, if we are going to do these trade agreements, 
we ought to be talking about uplifting the living standards of working 
people, of low-income people, in our country and other countries.
  What we have right now, without clearly enforceable standards dealing 
with the basic right to organize and bargain collectively, to earn a 
decent living in other countries, much less in our own country, is a 
trade agreement that says to working people: Look, these multinationals 
can go to other countries. They don't have to comply with fair labor 
standards, including the right of people to be able to organize and 
bargain collectively. They can pay low wages, miserably low wages, with 
exploitive working conditions, and then export those products back to 
our country, undercutting working people who are trying to produce and 
basically eliminating our jobs. It is lose-lose. That is why the 
Feingold-Jackson bill is such a clear alternative.
  If we pass these bills without any kind of meaningful and enforceable 
protection for the interests of working families, we will have made a 
big mistake. That is part of what is going to be happening in Seattle. 
You will see at this WTO meeting all sorts of NGOs, nongovernment 
organizations, all sorts of environmental organizations. Being a 
Senator from Minnesota, a lot of farm organizations and farmers are 
going to be there. A lot of labor people are going to be there; a lot 
of working people are going to be there. They are going to basically 
say that is exactly what is at issue here--when we look at S. 1387 and 
1389, the African Growth and Opportunity Act and the U.S. Caribbean 
Basin Trade Enhancement Act. We are for trade; we are for being in an 
international economy, but we are not for the kind of trade agreements 
that drive our wages down and basically eliminate our jobs and don't 
provide protection for people in other countries.
  If we are going to have trade agreements, we are for them, but not 
unless you have clearly enforceable standards dealing with 
environmental protection and dealing with the right of people to 
organize and bargain collectively. If you don't do that, then we know 
all too well what these kinds of agreements mean for working families 
in Minnesota and our country, much less for the people of the Caribbean 
and African countries.
  When people come out to this WTO meeting, they are going to say what 
WTO should be all about is the rules of trade, not trade without rules. 
We want to talk about the rules of trade. We don't want to support an 
agreement which is trade without rules. We want enforceable protection 
when it comes to the basic right of people to organize in these other 
countries and we want some enforceable environmental standards as well.
  As we move forward in this debate, we do have a piece of legislation 
that does look to other nations, that is all about trade, that is all 
about our role in the international economy. The difference is that the 
Feingold-Jackson legislation is a trade bill that will lead to 
uplifting the standards of working families.
  I want to signify to my friend and colleague from Delaware, whose 
work I respect, that we will have debate about whether or not this bill 
should be on the floor. If it is on the floor, one piece of good news 
for me, though I am in disagreement with the legislation, is it will 
give me the opportunity to bring an amendment to the floor that deals 
with the farm crisis, that says we should have a moratorium on these 
acquisitions and mergers by these big packers and big grain companies 
that are basically driving producers out. I hope there will be another 
amendment to take the cap off the loan rate to deal with the price 
crisis.
  I am determined that if we go forward with this legislation, I will 
be out of the box with those amendments as soon as possible next week. 
I have been waiting for 4 weeks now to come to the Senate floor with 
legislation that will alleviate the pain --or some of it--of family 
farmers in our States. I thank both of my colleagues for their 
patience.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Minnesota, Mr. Grams, is 
recognized.
  Mr. GRAMS. Mr. President, I rise in strong support of the trade 
package before us today which would expand trade opportunities with 
sub-Saharan Africa, offer enhanced tariff treatment to Caribbean Basin 
Initiative (CBI) nations, extend the Generalized System of Preferences 
(GSP) program for 5 years and extend the Trade Adjustment Assistance 
program.
  The CBI language will expand benefits to CBI nations, yet continue to 
protect import-sensitive industries in the United States. It will for 
the first time link benefits to improvements in areas such as 
intellectual property rights, investment, market access, government 
procurement and other issues which will not only help CBI nations 
develop but create an improved market for U.S. companies in the future. 
U.S. exports have tripled to the region since the Caribbean Basin 
Economic Recovery Act was passed in 1984. They have soared the first 6 
months of this year, and this legislation will further that progress.
  The CBI benefits will serve as the next step in helping this region 
become part of the Free Trade Area of the Americas.
  The Generalized System of Preferences program aiding the least 
developed countries expired in July of this year. Most of us have many 
small importers in our States who have depended on this lower tariff 
treatment to compete with larger retailers. I know there are many in 
Minnesota who are now paying enormous tariffs--at the risk of staying 
in business--and need the program extended for 5 years. Extending the 
program year by year, often retroactively, and usually with no 
certainty is no way to treat these small businesses or these countries. 
The GSP program has been improved over the years, and graduations of 
countries and products have ensured it helps only those who need 
assistance get the help.
  The African Growth and Opportunity Act is the most controversial, but 
crucial, part of this package. I have continually supported this effort 
and am disappointed it has taken so long to consider the measure on the 
floor. What really is very modest assistance to one of the poorest 
regions of the world, sub-Saharan Africa, has been battered from all 
sides--and it is the needy people of those countries who will suffer 
the most if we do not pass this legislation.
  Much of the opposition is from the textile and apparel industry, and 
I am sensitive to the concern that has come from textile companies in 
my own State of Minnesota. I believe the Senate bill has addressed this 
industry's concerns in a very responsible manner. The bill requires the 
use of U.S. textiles and includes tough transshipment language--far 
tougher than that of current law. The Customs Service has reassured us 
that Africa is not a transshipment problem. Africa supplies 1 percent 
of our textile imports and has little ability to flood our market with 
additional imports. I believe most new apparel investments in Africa 
will just replace many in Asia rather than expanding overall textile/
apparel imports.
  Some in the Congress believe this legislation should focus more on 
debt relief. However, we are involved in multilateral efforts to 
provide this relief and have made commitments unilaterally as well. I 
support these separate efforts. This is not the vehicle to expand our 
debt relief efforts. The focus of this legislation is to foster 
economic growth through incentives, to

[[Page 26592]]

create a high-level dialogue between U.S. and African leaders on 
economic issues, to start the process toward a U.S.-sub-Saharan free 
trade area--to help Africa develop and prosper through improved 
business relationships with our companies. We want these relationships 
to help Africa grow, to expand job opportunities, to become more market 
oriented as they reform economically and to become less dependent on 
foreign aid from other nations.
  Some will say this bill is not worthy of support because it does not 
provide enough benefit for the United States. Fortunately we don't 
always pass legislation solely on what it can do for us immediately. We 
need to look ahead, which we don't do enough of here, but this 
legislation is a good example of how we should act. The more than 700 
million people of sub-Saharan Africa represent an enormous market of 
the future for us. Right now my State of Minnesota is the 15th largest 
exporter to the region. We must continue to improve our export 
opportunities, but we can't do that if we don't allow sub-Saharan 
Africa the ability to export to us. If we are not there now helping 
them help themselves, developing the relationships needed to build 
friendship and trust, sub-Saharan Africans will not want to buy our 
products in the future. And we know how many other countries are there 
to step in if we are not there. Again, we can't expect to develop an 
export market there if we are not with them during the hard times when 
sub-Saharan Africans need us to give them a small edge to compete for 
exports into the United States. If Africa can't become strong and 
prosperous, it will not be able to buy our products in the future.
  A strong and secure Africa will not only benefit trade, but will help 
us achieve our goals in areas such as drug trafficking, terrorism, 
human rights, and many others.
  I also want to mention a statement I just read whereby AIDS activists 
oppose this legislation because they believe sub-Saharan African 
countries will spend more on business investment than on social 
services spending such as health care. I strongly disagree with this 
thinking. The Africa Growth and Opportunity Act will help countries 
grow and prosper. It will enable these governments, and their people to 
spend more on their health care needs, including the need to fight the 
devastation of AIDS.
  Mr. President, this bill is a good one. It complements what we are 
doing in so many other ways to help sub-Saharan Africa. The entire 
package is one we should enthusiastically support. I urge my colleagues 
to vote for this trade package without damaging amendments.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Alabama is recognized.
  Mr. SESSIONS. I ask unanimous consent that I be allowed to speak as 
in morning business for 15 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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