[Congressional Record (Bound Edition), Volume 145 (1999), Part 2]
[Senate]
[Pages 2061-2068]
[From the U.S. Government Publishing Office, www.gpo.gov]




                  PESTICIDE HARMONIZATION WITH CANADA

  Mr. DORGAN. Mr. President, when the U.S.-Canada Free Trade Agreement 
came into effect ten years ago, part of the understanding on 
agriculture was that our two nations were going to move rapidly toward 
the harmonization of pesticide regulations. It is now a decade later 
and relatively little actual progress has been in harmonization that is 
meaningful to our agricultural producers.
  Since this trade agreement took effect, the pace of Canadian spring 
and durum wheat, and barley exports to the United States have grown 
from a barely noticeable trickle into annual floods of imported grain 
into our markets. Over the years, I have described many factors that 
have produced this unfair trade relationship and unlevel playing

[[Page 2062]]

field between farmers of our two nations. The failure to achieve 
harmonization in pesticides between the United States and Canada 
compounds this ongoing trade problem.
  Our farmers are concerned that agricultural pesticides that are not 
available in the United States are being utilized by farmers in Canada 
to produce wheat, barley, and other agricultural commodities that are 
subsequently imported and consumed in the United States. They 
rightfully believe that it is unfair to import commodities produced 
with agricultural pesticides that are not available to U.S. producers. 
They believe that it is not in the interests of consumers or producers 
to allow such imports. However, it is not just a difference of 
availability of agricultural pesticides between our two countries, but 
also in the pricing of these chemicals.
  In recent times as the cost-price squeeze has escalated, our farmers 
have also been deeply concerned about pricing discrepancies for 
agricultural pesticides between our two countries. This past summer a 
survey of prices by the North Dakota Agricultural Statistics Services 
verified that there were significant differences in prices being paid 
for essentially the same pesticide by farmers in our two countries. In 
fact, among the half-dozen pesticides surveyed, farmers in the United 
States were paying between 117 percent and 193 percent higher prices 
than Canadian farmers. This was after adjusting for differences in 
currency exchange rates at that time.
  As a result of the pricing concerns raised by our producers, the 
recent agricultural agreement between the United States and Canada 
included a provision for a study by the U.S. Department of Agriculture 
and Ag Canada into the pricing differentials in agricultural chemicals 
between our two countries. While such a study is a welcome step 
forward, our farmers deserve more concrete steps. Harmonization cannot 
continue to be an illusive goal for the future. We must provide 
meaningful tools by which we can bring some fairness to our farmers.
  Today, I am reintroducing legislation that would take an important 
step in providing equitable treatment for U.S. farmers in the pricing 
of agricultural pesticides. This bill would only deal with agricultural 
chemicals that are identical or substantially similar. It only deals 
with pesticides that have already undergone rigorous review processes 
and have been registered and approved for use in both countries by the 
respective regulatory agencies.
  The bill would establish a procedure by which states may apply for 
and receive an Environmental Protection Agency label for agricultural 
chemicals sold in Canada that are identical of substantially similar to 
agricultural chemicals used in the United States. Thus, U.S. producers 
and suppliers could purchase such chemicals in Canada for use in the 
United States. The need for this bill is created by pesticide companies 
which use chemical labeling laws to protect their marketing and pricing 
structures, rather than the public interest. In their selective 
labeling of identical or substantially similar products across the 
border they are able to extract unjustified profits from farmers, and 
create unlevel pricing fields between our two countries.
  This bill is one legislative step in the process of full 
harmonization of pesticides between our two nations. It is designed to 
specifically to address the problem of pricing differentials on 
chemicals that are currently available in both countries. We need to 
take this step, so that we can start creating a bit more fair 
competition and level playing fields between farmers of our two 
countries. This bill would make harmonization a reality for those 
pesticides in which pricing is the only real difference.
  Together with this legislation, I will be working on other fronts to 
move forward as rapidly as possible toward full harmonization of 
pesticides. The U.S. Trade Representative, the Environmental Protection 
Agency, and the U.S. Department of Agriculture have the responsibility 
to make harmonization a reality. Farmers have been waiting for a decade 
for such harmonization. We should not make them wait any longer.
  Mr. President, I request unanimous consent that the text of the bill 
be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 394

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. REGISTRATION OF CANADIAN PESTICIDES BY STATES.

       (a) In General.--Section 24 of the Federal Insecticide, 
     Fungicide, and Rodenticide Act (7 U.S.C. 136v) is amended by 
     adding at the end the following:
       ``(d) Registration of Canadian Pesticides by States.--
       ``(1) Definitions.--In this subsection:
       ``(A) Canadian pesticide.--The term `Canadian pesticide' 
     means a pesticide that--
       ``(i) is registered for use as a pesticide in Canada;
       ``(ii) is identical or substantially similar in its 
     composition to any pesticide registered under section 3; and
       ``(iii) is registered by the registrant of a comparable 
     domestic pesticide or an affiliated entity of the registrant.
       ``(B) Comparable domestic pesticide.--The term `comparable 
     domestic pesticide' means a pesticide that--
       ``(i) is registered under section 3;
       ``(ii) is not subject to a notice of intent to cancel or 
     suspend or an enforcement action under section 12, based on 
     the labeling or composition of the pesticide;
       ``(iii) is used as the basis for comparison for the 
     determinations required under paragraph (3); and
       ``(iv) is labeled for use on the site or crop for which 
     registration is sought under this subsection on the basis of 
     a use that is not the subject of a pending interim 
     administrative review under section 3(c)(8).
       ``(2) Authority to register canadian pesticides.--
       ``(A) In general.--A State may register a Canadian 
     pesticide for distribution and use in the State if the 
     registration is consistent with this subsection and other 
     provisions of this Act and is approved by the Administrator.
       ``(B) Effect of registration.--
       ``(i) In general.--Except as provided in clause (ii), on 
     approval by the Administrator, the registration of a Canadian 
     pesticide by a State shall be considered a registration of 
     the pesticide under section 3.
       ``(ii) Distribution to other states.--A Canadian pesticide 
     that is registered by a State under this subsection and 
     distributed to a person in that State shall not be 
     transported to, or used by, a person in another State unless 
     the distribution and use is consistent with the registration 
     by the original State.
       ``(C) Registrant.--A State that registers a Canadian 
     pesticide under this subsection shall be considered the 
     registrant of the Canadian pesticide under this Act.
       ``(3) State requirements for registration.--To register a 
     Canadian pesticide under this subsection, a State shall--
       ``(A)(i) determine whether the Canadian pesticide is 
     identical or substantially similar in its composition to a 
     comparable domestic pesticide; and
       ``(ii) submit the proposed registration to the 
     Administrator only if the State determines that the Canadian 
     pesticide is identical or substantially similar in its 
     composition to a comparable domestic pesticide;
       ``(B) for each food or feed use authorized by the 
     registration--
       ``(i) determine whether there exists a tolerance or 
     exemption under the Federal Food, Drug, and Cosmetic Act (21 
     U.S.C. 301 et seq.) that permits the residues of the 
     pesticide on the food or feed; and
       ``(ii) identify the tolerances or exemptions in the 
     submission made under subparagraph (D);
       ``(C) require that the pesticide bear a label that--
       ``(i) specifies the information that is required to comply 
     with section 3(c)(5);
       ``(ii) identifies itself as the only valid label;
       ``(iii) identifies the State in which the product may be 
     used;
       ``(iv) identifies the approved use and includes directions 
     for use, use restrictions, and precautions that are identical 
     or substantial similar to the directions for use, use 
     restrictions, and precautions that are on the approved label 
     of the comparable domestic pesticide; and
       ``(v) includes a statement indicating that it is unlawful 
     to distribute or use the Canadian pesticide in the State in a 
     manner that is inconsistent with the registration of the 
     pesticide by the State; and
       ``(D) submit to the Administrator a description of the 
     proposed registration of the Canadian pesticide that includes 
     a statement of the determinations made under this paragraph, 
     the proposed labeling for the Canadian pesticide, and related 
     supporting documentation.
       ``(4) Approval of registration by administrator.--
       ``(A) In general.--The Administrator shall approve the 
     proposed registration of a Canadian pesticide by a State 
     submitted under

[[Page 2063]]

     paragraph (3)(D) if the Administrator determines that the 
     proposed registration of the Canadian pesticide by the State 
     is consistent with this subsection and other provisions of 
     this Act.
       ``(B) Notice of approval.--No registration of a Canadian 
     pesticide by a State under this subsection shall be 
     considered approved, or be effective, until the Administrator 
     provides notice of approval of the registration in writing to 
     the State.
       ``(5) Labeling of canadian pesticides.--
       ``(A) Distribution.--After a notice of the approval of a 
     Canadian pesticide by a State is received by the State, the 
     State shall make labels approved by the State and the 
     Administrator available to persons seeking to distribute the 
     Canadian pesticide in the State.
       ``(B) Use.--A Canadian pesticide that is registered by a 
     State under this subsection may be used within the State only 
     if the Canadian pesticide bears the approved label for use in 
     the State.
       ``(C) Containers.--Each container containing a Canadian 
     pesticide registered by a State shall, before the 
     transportation of the Canadian pesticide into the State and 
     at all times the Canadian pesticide is distributed or used in 
     the State, bear a label that is approved by the State and the 
     Administrator.
       ``(D) Report.--A person seeking to distribute a Canadian 
     pesticide registered by a State shall provide to the State a 
     report that--
       ``(i) identifies the person that will receive and use the 
     Canadian pesticide in the State; and
       ``(ii) states the quantity of the Canadian pesticide that 
     will be transported into the State.
       ``(E) Affixing labels.--The act of affixing a label to a 
     Canadian pesticide under this subsection shall not be 
     considered production for the purposes of this Act.
       ``(6) Annual reports.--
       ``(A) Preparation.--A State registering 1 or more Canadian 
     pesticides under this subsection shall prepare an annual 
     report that--
       ``(i) identifies the Canadian pesticides that are 
     registered by the State;
       ``(ii) identifies the users of Canadian pesticides used in 
     the State; and
       ``(iii) states the quantity of Canadian pesticides used in 
     the State.
       ``(B) Availability.--On the request of the Administrator, 
     the State shall provide a copy of the annual report to the 
     Administrator.
       ``(7) Recalls.--If the Administrator determines that it is 
     necessary under this Act to terminate the distribution or use 
     of a Canadian pesticide in a State, on the request of the 
     Administrator, the State shall recall the Canadian pesticide.
       ``(8) Suspension of state authority to register canadian 
     pesticides.--
       ``(A) In general.--If the Administrator finds that a State 
     that has registered 1 or more Canadian pesticides under this 
     subsection is not capable of exercising adequate controls to 
     ensure that registration under this subsection is consistent 
     with this subsection and other provisions of this Act or has 
     failed to exercise adequate control of 1 or more Canadian 
     pesticides, the Administrator may suspend the authority of 
     the State to register Canadian pesticides under this 
     subsection until such time as the Administrator determines 
     that the State can and will exercise adequate control of the 
     Canadian pesticides.
       ``(B) Notice and opportunity to respond.--Before suspending 
     the authority of a State to register a Canadian pesticide, 
     the Administrator shall--
       ``(i) advise the State that the Administrator proposes to 
     suspend the authority and the reasons for the proposed 
     suspension; and
       ``(ii) provide the State with an opportunity time to 
     respond to the proposal to suspend.
       ``(9) Disclosure of information by administrator to the 
     state.--The Administrator may disclose to a State that is 
     seeking to register a Canadian pesticide in the State 
     information that is necessary for the State to make the 
     determinations required by paragraph (3) if the State 
     certifies to the Administrator that the State can and will 
     maintain the confidentiality of any trade secrets or 
     commercial or financial information that was marked under 
     section 10(a) provided by the Administrator to the State 
     under this subsection to the same extent as is required under 
     section 10.
       ``(10) Provision of information by registrants of 
     comparable domestic pesticides.--If a State registers a 
     Canadian pesticide, and a registrant of a comparable domestic 
     pesticide that is (directly or through an affiliate) a 
     foreign registrant fails to provide to the State the 
     information possessed by the registrant that is necessary to 
     make the determinations required by paragraph (3), the 
     Administrator may suspend without a hearing all pesticide 
     registrations issued to the registrant under this Act.
       ``(11) Patents.--Title 35, United States Code, shall not 
     apply to a Canadian pesticide registered by a State under 
     this subsection that is transported into the United States or 
     to any person that takes an action with respect to the 
     Canadian pesticide in accordance with this subsection.
       ``(12) Submissions.--A submission by a State under this 
     section shall not be considered an application under section 
     3(c)(1)(F).''.
       (b) Conforming Amendment.--The table of contents in section 
     1(b) of the Federal Insecticide, Fungicide, and Rodenticide 
     Act (7 U.S.C. prec. 121) is amended by adding at the end of 
     the items relating to section 24 the following:

       ``(d) Registration of Canadian pesticides by States.
       ``(1) Definitions.
       ``(2) Authority to register Canadian pesticides.
       ``(3) State requirements for registration.
       ``(4) Approval of registration by Administrator.
       ``(5) Labeling of Canadian pesticides.
       ``(6) Annual reports.
       ``(7) Recalls.
       ``(8) Suspension of State authority to register Canadian 
     pesticides.
       ``(9) Disclosure of information by Administrator to the 
     State.
       ``(10) Provision of information by registrants of 
     comparable domestic pesticides.
       ``(11) Patents.
       ``(12) Submissions.''.
       (c) Effective Date.--This section and the amendments made 
     by this section take effect 180 days after the date of 
     enactment of this Act.
                                 ______
                                 
      By Mr. ROCKEFELLER (for himself, Mr. Sarbanes, Mr. Byrd, and Mr. 
        Hollings):
  S. 395. A bill to ensure that the volume of steel imports does not 
exceed the average monthly volume of such imports during the 36-month 
period preceding July 1997; to the Committee on Finance.


                  Stop Illegal Steel Trade Act of 1999

 Mr. ROCKEFELLER. Mr. President, I am taking a major step to 
force action to help the American steel industry through the current 
import crisis. Today, I propose that Congress legislate a solution to 
the problem of illegal steel dumping. I believe that without swift 
action, the United States' steelworkers will continue to be laid off in 
near record numbers, and our steelworkers will--not unlike the late 70s 
and early 80s--permanently lose jobs and that the industry's long term 
viability will be threatened. The difference between 1998 and what 
happened a decade or two ago is that this time our steel industry has 
invested in itself and become the most efficient steel producer in the 
world. We can take on all comers if we are given a level playing field. 
Sadly, the strength of our steel industry is now jeopardized, despite 
its own successful efforts to retool for the next century, because of 
unfair trade practices and unprecedented levels of imports. I firmly 
believe the ongoing devastation of our steel industry is unnecessary 
and a direct result of massive import surges from countries who are 
seeking to make America the world's importer of last resort. We cannot 
continue to let our nation's steelworkers bear the brunt of the 
financial shocks caused by financial mismanagement in Asia or elsewhere 
in the world.
  I am joined in introducing this legislation today by my colleagues, 
Senators Sarbanes, Byrd and Hollings. The bill is the ``Stop Illegal 
Steel Trade Act of 1999.'' This legislation would place restrictions on 
steel imports for a period of three years in order to return steel 
imports to a fairer, 20% share of the United States' market. The bill 
provides the President with the authority to take the necessary steps 
to ensure that we return to this pre-crisis level--he can impose 
quotas, tariff surcharges, negotiate enforceable voluntary export 
restraint agreements, or choose other means to ensure that steel 
imports in any given month do not exceed the average of steel imports 
in the United States for the three years prior to July 1997. The bill 
would be effective within 60 days of enactment. The Secretary of the 
Treasury, as the head of the United States' Customs Service, and the 
Secretary of Commerce are charged with implementing, administering, and 
enforcing the restraints on steel imports. The Customs Service is 
explicitly authorized to deny entry into the United States any steel 
products that exceed the allowable level of imports. Volume will be 
determined on the basis of tonnage. This bill would apply to the 
following categories of steel products--semifinished, plates, sheets 
and strips, wire rods, wire and wire products, rail type products, 
bars, structural shapes and units, pipes and tubes, iron ore and

[[Page 2064]]

coke. The bill's provisions will expire after 3 years (beginning 60 
days from enactment).
  Right now, imports comprise roughly 30-35% of all steel sold in the 
United States. Imports of steel mill products in 1998 are expected to 
exceed 41 million net tons. Over the last year and a half, steel 
imports have increased by 47%. That high percentage of imports is 
unsustainable and without quick action I think they will effectively 
undermine our steel industry's ability to survive. The industry and its 
workers have responded to this import surge by filing international 
trade cases against Japan, Russia, and Brazil. The Department of 
Commerce found critical circumstances exist with respect to those cases 
and has expedited their consideration. I commend them for doing so, but 
the trade case only deals with hot-rolled steel. Import surges have 
occurred in a wide variety of steel imports and if the hot-rolled 
problem was adequately addressed I think we would just see a new 
problem with cold-rolled, or plate.
  I think Congress must act to deal comprehensively with this problem. 
It should make sure that one category of imports isn't controlled only 
to find we have a new problem with a new category of steel products. 
Under the legislation we are introducing today, Japan would be forced 
to reduce its imports to 2.2 million tons per year down from the 
approximately 6.6 million tons of steel they sent to the United States 
in 1998. Russia, which sent about 5.2 million tons of steel to the 
United States in 1998, under this bill would be forced to dramatically 
reduce the amount of steel it ships to the United States. Stemming the 
import flood from Russia is especially important because the numbers 
show that the Russians have steadily and significantly increased their 
exports to the United States over the last several years. Russia 
exported 1.4 million tons to the United States in 1995, 1.6 million 
tons in 1996, and 3.3 million tons in 1997. Japan and Russia are two 
countries which provide a clear illustration of why we need to limit 
steel imports. Job losses and unfilled order books of steel companies 
across the country tell us we need to act to stop the flood of imports. 
But these numbers, which give you an idea as to how much tonnage has 
increased, make it clear why the United States must guard against the 
continued import surges in our market from foreign countries seeking to 
sell to the United States market. Currently, there is no cost for 
foreign countries to violate our trade laws other than the threat of 
suit, but our steelworkers, their families and communities are paying a 
steep price every day for our failure to step in and effectively 
address the problem.
  I should note to my colleagues that legislation restricting the level 
of steel imports was introduced last week in the House of 
Representatives and it has already garnered over a quarter of its 
membership as cosponsors. Congressman Visclosky is leading this effort 
in the House of Representatives and I look forward to working with him 
and all the House cosponsors who are eager to stand up for steel.
  Frankly, I have watched and waited for months as this crisis has 
continued, and as more and more workers have been laid off or placed on 
short weeks. The number of workers who have been directly affected by 
this crisis stands at over 10,000 today, but I believe that number 
could escalate to as many as ten times that figure if we all we 
continue to do is hope that the crisis will abate on its own. I think 
it is time to take a leadership role in this crisis and move 
aggressively to stop the dumping. Under current U.S. law, only the 
President has the full authority to act immediately to begin the 
process of an International Trade Commission investigation into this 
problem of import surges and steel dumping. The ITC's work takes time--
anywhere from 120 to 150 days depending on the complexity of the case. 
I believe what my steelworkers have told me, our industry doesn't have 
the luxury of time to wait. That's why I have taken this extraordinary 
step of suggesting that Congress substitute its judgement for Executive 
action. Effective Executive action could eliminate the need for this 
Congressional action, but I cannot sit idly by and watch our steel 
industry take a beating because of unfair foreign competition.
  For the record, you all should know that West Virginia has a proud 
history as one of our nation's foremost steel manufacturers. We are the 
home of Weirton, Wheeling Pittsburgh, Wheeling Nisshin, and Follansbee 
Steel. West Virginia and its neighboring states are the birthplace of 
our modern steel industry--an industry that built an industrialized 
America and launched our nation's prosperity in the beginning of this 
great century. They forged the metal that brought us through two world 
wars, built the American economy's manufacturing base and allowed us to 
lead the world in the transition to the new economy.
  That is why, when Weirton Steel has laid off 20% of its workforce and 
is facing losses that it cannot sustain over time, I cannot just hope 
that trade cases will take care of part of the problem caused by some 
of the worst offenders. Wheeling Pittsburgh, Wheeling Nisshin, and 
Follansbee, are making it through these hard times, but they would be 
that much more prosperous if they weren't dealing with unfair 
competition.
  Today I want to share a quote with my colleagues that I believe will 
provide my colleagues with some important context for this matter and 
which underscores why I believe that Congress should act:

       So, Mr. President, it is an extremely timely occasion that 
     my colleagues and I rise to address the Senate on this issue. 
     It is also timely, Mr. President, because the American steel 
     industry is in the midst of its most serious crisis in the 
     postwar era.
       Yet, at the same time, the steel industry is fundamental to 
     the American economy. It supplies virtually every sector, 
     from automobiles, construction, railroads, shipbuilding, 
     aerospace, defense, oil and gas, agriculture, industrial 
     machinery and equipment, the appliances, utensils and 
     beverage containers. The fortunes of this industry--good or 
     ill--will have a major impact on the rest of the economy.
       But the purpose a number of us have in speaking today, Mr. 
     President, is to discuss trade; for it is the major component 
     of the current crisis and may prove to be the factor most 
     difficult to control, inasmuch as it is not totally a 
     domestic issue.
       Trade is also not a new problem. Steel import restraints 
     have been proposed in one form or another since the 1960's. 
     The trigger price mechanism was in effect from 1978 to 1980 
     and then again in 1981. Although these programs achieved some 
     short-term results, mostly in terms of improving price 
     levels, none of them provided long-term solutions to the 
     growing problems of global overcapacity and the failure of 
     noncompetitive steel industries to adjust.
       The latter problem has become more and more a factor in the 
     difficulties of the past several years. While we have 
     continued to practice the ethic of the free market system, 
     the Europeans, quite plainly, have not. Subsidies and dumping 
     have increased as European governments attempt to stay in 
     power and forestall social unrest and unemployment by 
     maintaining steel jobs and production at any cost. Hence the 
     tremendous Government subsidies.
       In the beginning those were social policy decisions any 
     government is entitled to make for itself. However, it has 
     become apparent in the past few years that maintaining steel 
     production through subsidies require substantial exporting in 
     order to unload the excess supply. The chief victim of that 
     export has been the United States, meaning that the European 
     steel process has been at our expense. And that, Mr. 
     President, is unacceptable.
       It is all well and good for European Community governments 
     to say their steel industry is in bad shape--which it is; or 
     to argue they need time for adjustment--which they do. But 
     their adjustment plans have consistently been behind schedule 
     thanks to foot-dragging by member nation governments, while 
     exports here have increased. I have no intention of 
     explaining to the steelworker in Pittsburgh or Youngstown or 
     Gary or East Chicago that has to give up his job in order to 
     help his Belgian, French, or Italian colleague to keep his. 
     My responsibility, the responsibility of the Senate, the 
     responsibility of the administration, is to our own people--
     to take those actions which will be good for them both in the 
     long term and in the short term.
       That responsibility does not preclude compromise, and it 
     does not preclude a recognition that steel is a global 
     industry where multilateral solutions may be necessary and 
     appropriate. In fact, I think there is much to be said for an 
     international steel agreement which would include limits on 
     financing new capacity in third countries, guidelines on 
     adjustment, and, if necessary, global import restraints. But 
     progress in that direction must

[[Page 2065]]

     begin with a recognition of where the problems are and whose 
     responsibility it is to begin fixing them. And, as I said in 
     this Chamber last Thursday, the responsibility in this case--
     both legal and economic--is clear.
       European steel subsidies violate both U.S. law and 
     international agreements which the European Community member 
     nations have signed. We went through five years of 
     negotiations to produce those agreements. On our part we made 
     significant, substantive, concessions, like the abolition of 
     the American selling price, the wine-gallon-proof-gallon 
     system, and the acceptance of an injury test in subsidy 
     cases. What we seem to have received in return was a lot of 
     promises. Promises to adhere to the discipline of the codes 
     that had been negotiated. Promises to reduce or eliminate 
     subsidies, dumping, and other unfair trade practices. 
     Promises to open up Government procurement.
       We accepted all those promises. Mr. President, because they 
     contained the hope of greater discipline over unfair trade 
     practices and the hope of more markets for American products. 
     And we accepted them because we believe in a free market 
     system that functions according to the prescribed rules that 
     all parties adhere to. Promoting those rules has been the 
     essence of our trade policy ever since, and I for one believe 
     that should continue to be our policy.
       But I must say, Mr. President, that in the intervening 
     years since 1979 when we finished negotiating the Tokyo round 
     and enacted the Trade Agreements Act of that year, I have 
     heard a lot from the people in this country injured by the 
     concessions we made in the Tokyo round and very little from 
     anyone who has gained by those agreements. And now, the 
     system we sought to establish at that time faces its most 
     serious test. Simply put, the European Community and its 
     member states do not want to accept the responsibilities they 
     agreed to undertake in 1979. They do not want the rules 
     enforced. They do not want to make the hard economic 
     decisions about their own steel industry that the market 
     requires them to make.
       They would rather export their unemployment to the United 
     States. They are screaming very loud about our efforts to 
     hold them not only to their word, but to the letter and 
     spirit of international law. Mr. President, despite the 
     screams, despite the alleged serious consequences to trade 
     relations, this is a test we must meet, because both our own 
     industry and the international trading system, one based on 
     the concept of free and fair trade, are at stake.
       I need say no more about the desperate situation in our 
     steel industry. Those of us with steel facilities in our 
     State see it every time we return home. Not to defend our own 
     industry, particularly when it is consistent with our own law 
     and with our international obligations to do so, is to turn 
     an already serious situation into a major disaster. It is 
     also to abandon the people who elected us.
       There is an issue here beyond the survival of the American 
     steel industry, Mr. President. That is the survival of a fair 
     and equitable trading system based on mutually acceptable 
     rules of the game. Some people in this country bemoan the 
     revival of the days of the Smoot-Hawley tariff or a return to 
     the ``begger-thy-neighbor'' policies of years ago every time 
     anyone in Congress starts to talk about imports being a 
     problem.
       Mr. President, no one, including me--most specifically me--
     wants to return to that era of depression, but to avoid it, 
     we must understand the reason for it. That reason, in my 
     judgement, was the failure at that time to develop an 
     international trading system based on free market principles, 
     based on the theory of comparative advantage, based on 
     universally accepted rules for participation in that system.
       Mr. President, this country was a great leader during and 
     after World War II. In 1943, our leaders of the free world 
     went to Bretton Woods, N.H., and at Bretton Woods, we 
     developed a system with exactly those goals in mind that I 
     just mentioned. At Bretton Woods, we developed that system 
     and we have maintained it ever since, at least up to now. Now 
     we face problems more intractable, a world more complex, and 
     power more diffused than ever before. The old solutions seem 
     to be losing their attractiveness in favor of even older 
     solutions, a return to the mercantilist policies of the past.
       Mr. President, that is what is at stake in this 
     controversy. Not just our steel industry, and not just the 
     European steel industry, important though they both are. It 
     is the survival of a free world trading system that is the 
     issue, because it cannot survive unless nations are willing 
     to accept their responsibilities and their subsidies.
       Mr. President, I state this not only to send a message to 
     the European Community, but also to make it clear to others 
     in our own Government that we in Congress hold very strong 
     views on this matter. We in Congress wrote this law. We in 
     Congress made it tough on purpose--precisely to prevent the 
     kind of devastating unfair trade practices and actions that 
     we are experiencing right now in steel.
       Today it is steel, tomorrow, it may be some other product, 
     it may be some other set of States, it may be some other 
     industries.
       I say, Mr. President, that it is terribly important that 
     the law continue to work now against those kinds of unfair 
     trade actions.
       So far the law is working to stop that action. It is 
     absolutely essential that we let it continue to work and not 
     seek some expedient end to the matter that might make for 
     short-term peace at the bargaining table but will produce 
     long-term chaos in the international trading system.
       It is not ``protectionist'' to take action against such 
     patently unfair practices. In fact, to fail to do so would 
     compromise the principles of free trade which are central to 
     the international trade agreement both we and the Europeans 
     signed.
       We must send a strong message to our trading partners that 
     the United States expects fair trade in our markets and the 
     vigorous enforcement of our trade laws, and I urge the 
     Secretary of Commerce to hold to that course.

  That quote is from a statement delivered on the Senate floor on July 
26, 1982 by the late Senator John Heinz from the great steel state of 
Pennsylvania. He made it when he introduced legislation to deal with 
the problems facing the steel industry during the early 1980s. We've 
heard a lot about Yogi Berra lately, but I think this statement says 
``the more things change, the more they remain the same.'' Our trade 
dilemma remains the same today.
  We survived the crises in the late 70s and 80s because our industry, 
its workers, and their elected representatives acted. The industry 
needed to streamline and heavily invest in capital improvements. It 
needed to become leaner, and more efficient. The hard transitions we 
made as a direct result of action and sacrifice by our steelworkers and 
their families. Steel technology dramatically improved because the 
industry invested $50 billion of its own money. Cost of production 
decreased. The United States' steel industry has the lowest number of 
man hours per ton of any steel producer in the world. Today, we can 
make steel better, cheaper, and cleaner than any of our competitors, 
bar none. But it cost 300,000 steelworkers their jobs. After all that, 
the one thing we cannot compromise is that we have to have a level 
playing field on which we can compete. No one can compete when the 
competition sells below the cost of production and dumps steel in 
massive amounts onto our market--not even the American steel industry.
  Short of a handful of trade cases, and tough talk to trading partners 
who have shown little intention of caring what our stance will be, 
little has been done to stop the illegal dumping. If after all that 
agony of transforming itself into the most efficient steel producer in 
the world we are still trying to tell our industry that they have to 
take it on the chin against illegal imports--that our unfair trade laws 
can't protect their ability to compete on the world market--then many 
who hope to continue to grow our economy through expanded trade will be 
sorely surprised by the reaction of an American public that does not 
see the benefits of trade.
  I want the United States to push to continue to open new markets for 
our exports. I think that only makes good economic sense. I very much 
want a fair and free international trading system. But I think we have 
to insist that everyone has to play by the rules. This bill says that 
if our trading partners won't play by the rules, then Congress will see 
to it that our industry isn't unduly disadvantaged--to me, that only 
seems fair.
  I urge all my colleagues to join on as cosponsors. We can do this, 
together.
  Mr. President--I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 395

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Stop Illegal Steel Trade Act 
     of 1999''.

     SEC. 2. REDUCTION IN VOLUME OF STEEL IMPORTS.

       Notwithstanding any other provision of law, within 60 days 
     after the date of enactment of this Act, the President shall 
     take the necessary steps, by imposing quotas, tariff 
     surcharges, negotiated enforceable voluntary export restraint 
     agreements, or otherwise, to ensure that the volume of steel 
     products imported into the United States

[[Page 2066]]

     during any month does not exceed the average volume of steel 
     products that was imported monthly into the United States 
     during the 36-month period preceding July 1997.

     SEC. 3. ENFORCEMENT AUTHORITY.

       Within 60 days after the date of enactment of this Act, the 
     Secretary of the Treasury, through the United States Customs 
     Service, and the Secretary of Commerce shall implement a 
     program for administering and enforcing the restraints on 
     imports under section 2. The Customs Service is authorized to 
     refuse entry into the customs territory of the United States 
     of any steel products that exceed the allowable levels of 
     imports of such products.

     SEC. 4. APPLICABILITY.

       (a) Categories.--This Act shall apply to the following 
     categories of steel products: semifinished, plates, sheets 
     and strips, wire rods, wire and wire products, rail type 
     products, bars, structural shapes and units, pipes and tubes, 
     iron ore, and coke products.
       (b) Volume.--Volume of steel products for purposes of this 
     Act shall be determined on the basis of tonnage of such 
     products.

     SEC. 5. EXPIRATION.

       This Act shall expire at the end of the 3-year period 
     beginning 60 days after the date of the enactment of this 
     Act.
                                 ______
                                 
      By Mr. HUTCHINSON (for himself, Mr. Coverdell, Mr. Murkowski, Mr. 
        DeWine, Mr. Allard, Mr. Sessions, Mr. Ashcroft, Mr. Inhofe, Mr. 
        Thomas, Mr. Grams, Mr. Bunning, Mr. Brownback, Mr. Helms, and 
        Mr. McConnell):
  S. 396. A bill to provide dollars to the classroom; to the Committee 
on Health, Education, Labor, and Pensions.


                    the dollars to the classroom act

 Mr. HUTCHINSON. Mr. President, I am honored to have the 
opportunity to introduce legislation addressing one of the most 
important issues Americans are concerned about today--education. The 
Dollars to the Classroom Act will redirect approximately 3.5 billion 
dollars in funding for elementary and secondary education back to the 
states and into our classrooms.
  This year Congress will be focusing its efforts on the 
reauthorization of the Elementary and Secondary Education Act. It is 
time for us to take a good look at the status of education in America 
and to recognize the lack of improvement we have seen in our elementary 
and secondary schools. The percentage of 12th grade students who meet 
standards in reading has actually decreased during this decade. When 
limited Federal funding is spread so thinly over such a wide area, the 
result is ineffective programs that fail to provide students with the 
basic skills they need to succeed.
  I am committed to improving educational opportunities for our 
children, and this can happen best at the local level. Those who best 
know our children--parents and teachers--should be responsible for 
deciding what programs are most important, not bureaucrats in 
Washington. It is time to stop the one-size-fits-all approach, and 
start letting those at the local level decide what is best for them.
  Right now, state and local educational agencies are implementing 
reforms to better prepare their students for the future. Even the 
president recently stated in his budget proposal that ``we have long 
known the ingredients for successful schools; the challenge is to give 
parents and teachers and superintendents the tools to put them in place 
and stimulate real change right now.'' Many states have already 
implemented class-size reduction programs, and nineteen states 
currently have programs to turn around their poorest-performing school. 
The problem is not that states and local school districts do not have 
ideas about how to improve their schools, it is that Washington is 
telling them how to do it through competitive grants.
  Many schools never see these grants, either. Schools in rural areas 
and that have low funding levels often cannot afford to hire grant 
writers to apply for the numerous federal programs. These schools 
should not have to spend money on administration just to receive 
funding, when they could receive the funding directly and decide what 
their needs are.
  Currently, states have to bear the burden of abiding by federal 
regulations to receive education dollars. The system we have in place 
now is inefficient and does not allow the best use of each taxpayer 
dollar that is spent. According to the Crossroads Project--the 
Congressional fact-finding education initiative--only 65 percent of 
Department of Education elementary and secondary dollars reach 
classrooms. Instead of paying for administration and paperwork, we must 
give control back to parents and teachers, who can decide what is best 
for our children. Who do you trust to spend our taxpayer dollars best--
bureaucrats, or those involved in our local schools?
  That is why I am introducing the Dollars to the Classroom Act. This 
legislation has been included in S. 277, the Republican education 
package, and similar legislation will be introduced soon in the House 
of Representatives. In fact, the House of Representatives passed its 
version of the Dollars to the Classroom Act last fall. This legislation 
redirects $3.5 billion of K-12 education dollars to the States, 
requiring only that 95% of that money actually reach our children's 
classrooms. This money can be used for whatever the local education 
officials deem necessary and important to our children's education. 
School districts may buy new books, hire more teachers, build new 
schools, or buy new computers.
  We must begin to prioritize the way we spend our education dollars, 
and we must put children first, not bureaucracy. Let those on the State 
and local levels decide if more books are needed to help our children 
read, or more teachers are needed to reduce class size. We cannot 
afford to allow a stagnant system to continue. We owe it to our 
children to allow schools to address the real needs they are facing 
today.
 Mr. ASHCROFT. Mr. President, on two separate occasions this 
year I have made statements about the importance of education to our 
Nation and to this Congress. I've talked about what our parents want 
for their children, how to provide a good education, and how many of 
our current federal policies have failed to achieve what we want for 
our children.
  Today, as the Senator from Arkansas introduces his ``Dollars to the 
Classroom Act,'' which incorporates ingredients for educational success 
into our federal policy, I want to join in cosponsoring his bill as it 
will empower states and local school districts to spend federal 
resources in the best way they see fit. I also want to take this 
opportunity to emphasize the importance of education.
  A Pew Research Center poll conducted last fall found that 88% of 
those surveyed think that improving the quality of public school 
education is ``very important.'' Now, I am not one to put a lot of 
emphasis on polls, but I think that this poll indicates what we already 
know: that making sure kids get a world-class education is a real 
priority for our nation. Moms and dads want their children to be in 
settings where they will be challenged to reach high levels of academic 
achievement, taught by qualified and caring teachers, and provided a 
safe learning environment.
  Obviously, parents want to be sure that schools are using the 
ingredients of success in education: parental involvement, local 
control, an emphasis on basic academics, and dollars spent in the 
classroom, not on distant bureaucracy and ineffective programs. These 
are the ingredients we must have to elevate educational performance. It 
is interesting to note that a recent report of the House Committee on 
Education and the Workforce Subcommittee on Oversight and 
Investigations found that successful schools and school systems were 
not the product of federal funding and directives.
  Unfortunately, we are continuing to find that many of our current 
federal education programs, while well-intended, simply do not contain 
the ingredients of a successful education. Rather than promoting 
parental involvement, local control, and dollars going to the 
classroom, many federal programs promote a ``Washington-knows-best'' 
policy, in which federal bureaucrats decide exactly what education 
programs should be developed and exactly how every dollar should be 
spent. Not only are states, schools, teachers, and parents left without 
much say in how to educate their children, but they are also drained of 
time

[[Page 2067]]

and energy complying with all the federal mandates handed down to them.
  Our current federal education laws bog states down in mountains of 
paperwork every year. Even though the U.S. Department of Education 
recently attempted to reduce paperwork burdens, the Department still 
requires over 48.6 million hours worth of paperwork per year--or the 
equivalent of 25,000 employees working full-time. There are more than 
20,000 pages of applications states must fill out to receive federal 
education funds each year.
  While the Department of Education brags that its staff is one of the 
smallest federal agencies with 4,637 people, state education agencies 
have to employ nearly 13,400 FTEs (full-time equivalents) with federal 
dollars to administer the myriad federal programs. Hence, there are 
nearly three times as many federally funded employees of state 
education agencies administering federal education programs as there 
are U.S. Department of Education employees.
  It is no wonder that up to 35% of our federal education dollar gets 
eaten up by bureaucratic and administrative costs. And we should 
remember this in the context of the fact that only about 7% of all 
education funding comes from the federal government. As we can see, 
this small amount of the entire education pie consumes a 
disproportionate share of the time states and local school districts 
must spend to administer education programs.
  I have also spoken in the past about the Ohio study finding that 52% 
of the paperwork required of an Ohio school district was related to 
participation in federal programs, while federal dollars provided less 
than 5% of its total education funding. And I've also noted that in 
Florida it takes six times as many state employees to administer 
federal funds as it does to administer state dollars.
  Clearly, federal rules and regulations eat up precious dollars and 
teacher time. We must find a way to change this.
  I have also highlighted that the problem that many of our children 
and school districts never get to see the federal tax dollars paid by 
their parents for education because a great deal of federal educational 
funding is awarded on a competitive basis. Local schools must come to 
Washington and plead their case to get back the money the parents of 
their communities sent to the federal treasury. Who suffers the most 
from this system? Smaller and poorer schools, who don't have the time 
and money to wade through thick grant applications or hire a grant 
writer to get their fair share of the federal dollar.
  It is also interesting to note that, according to the Department of 
Education's own estimates, it takes 216 steps and 20 weeks to complete 
the review process for a federal discretionary education grant. The 
Department boasts that this is actually a streamlined process, since it 
used to take 26 weeks and took 487 steps from start to finish!
  I have talked about a third problem with many current federal 
education programs: dollars are earmarked for one and only one purpose, 
to the exclusion of all other uses. And many times, the distant 
Washington bureaucrats are designating funds for something that a 
school district doesn't even need at the time.
  I like to use an analogy to explain this problem. If you feel a 
headache coming on, would you rather be treated by a doctor one mile 
away from where you live, or a thousand miles away? And if you have to 
use the doctor a thousand miles away, how good is he or she going to be 
at prescribing what you need for your headache? It sure would be nicer 
to see someone close by who could take a look at you in person and make 
a proper diagnosis.
  And what if, when you tell the doctor a thousand miles away that you 
have a headache, she says to you, ``Oh, that's too bad. But today we're 
running a special on crutches. We are prescribing crutches for people 
like you all over the country, because we've heard that you may need 
them.'' You say, ``That's fine, but how is a crutch going to help my 
headache? Can't I get the money to buy some aspirin?'' And the doctor 
says, ``Sorry, but you can only use this money for crutches, not for 
aspirin, or anything else.''
  This is exactly what happens with so many of these categorical 
programs mandated from the federal level. Your local school district 
has determined that it needs funding for one thing, but the federal 
government will only release it for another. As a result, schools don't 
have the flexibility to use their funding for what they know they need 
to provide the best education possible for their students.
  For all the federal programs and dollars committed to education, are 
we seeing success? I'm afraid not.
  I have heard of a recent report from the Organization for Economic 
Cooperation and Development, which noted that even though the United 
States dedicates one of the largest shares of gross domestic product to 
education, it has fallen behind other economic powers in high school 
graduation rates. Only 72 percent of 18-year-old Americans graduated in 
1996, trailing all other developed countries.
  Our Congressional Research Service has explained why current federal 
aid programs may not lead to educational improvement. They note that 
these programs have generally been focused on specific student 
population groups with special needs, priority subject areas, or 
specific educational concepts or techniques. CRS reports:

       While such ``categorical'' program structures assure that 
     aid is directed to the priority population or purpose, they 
     may not always be effective--instruction may become 
     fragmented and poorly coordinated; the proliferation of 
     programs may be duplicative; each federally assisted program 
     may affect only a marginal portion of each pupil's 
     instructional time that is poorly coordinated with the 
     remainder of her or his instruction; regulations intended to 
     target aid on particular areas of need may unintentionally 
     limit local ability to engage in comprehensive reforms; or 
     the partial segregation of special needs students, while it 
     helps to guarantee that funds can be clearly associated with 
     each program's intended beneficiaries, may also reinforce 
     tendencies toward tracking pupils by achievement level, and 
     unintentionally contribute to a perpetuation of lower 
     expectations for their performance.

  I think the Congressional Research Service makes some valid 
observations about why our current federal education policy is not 
generally boosting student achievement and making our children 
competitive with other nations. CRS says that current federal policy 
hinders an important element of educational success: local control.
  Based upon what we know about the state of our current federal 
education policy, we must explore how to direct our resources in ways 
that will stimulate academic success and high achievement. States, 
school districts, school boards, teachers, and of course, parents, are 
asking for local control and flexibility to spend federal education 
dollars in ways they know will work. They know how to incorporate the 
ingredients of success into the education of their children.
  Senator Hutchinson's ``Dollars to the Classroom Act'' will give 
states and local schools the flexibility that they desperately need. 
His legislation takes nearly $3.5 billion from a number of federal 
education programs, directs the money to the states based upon student 
population, and requires that at least 95% of it is spent in our 
children's classrooms. Local school districts may use the funds in ways 
they believe will be most effective in elevating student achievement.
  Under the ``Dollars to Classroom Act,'' parents, teachers, school 
boards and administrators will have the freedom to use federal dollars 
for what they need: whether it be to hire more teachers, raise teacher 
salaries, strengthen reading programs, buy new computers, or provide 
more one-on-one tutoring.
  The bill ensures that federal bureaucracy will be held at bay by 
forbidding the Secretary of Education from issuing any regulations 
regarding the type of classroom activities or services that school 
districts may choose to provide with the federal dollars. Finally, the 
``Dollars to Classroom Act'' calls for ways to streamline regulations 
and eliminate bureaucracy within major federal education laws.

[[Page 2068]]

  Mr. President, we need to ensure that more federal education money is 
sent to the classroom, and that states, schools, and parents have more 
flexibility in using those funds in the way that will best help 
students achieve their fullest potential. We must find ways to 
encourage states and local schools to be innovative and creative in 
finding the most successful ways to challenge our students to the 
highest levels and achievement. Senator Hutchinson's ``Dollars to the 
Classroom Act'' will help accomplish these goals, and that is why I am 
pleased to co-sponsor his legislation.
  During the coming months, Congress should continue to evaluate our 
current federal elementary and secondary education programs and make 
the necessary changes to incorporate the ingredients we know have 
proven successful in providing the best education possible for our 
children. We cannot afford to maintain the status quo if it is not 
working. We owe it to our next generation to provide them what they 
need to be successful in the 21st Century.

                          ____________________