[Congressional Record (Bound Edition), Volume 146 (2000), Part 12]
[Senate]
[Pages 17054-17073]
[From the U.S. Government Publishing Office, www.gpo.gov]



 TO AUTHORIZE EXTENSION OF NONDISCRIMINATORY TREATMENT TO THE PEOPLE'S 
            REPUBLIC OF CHINA--MOTION TO PROCEED--Continued

  Mr. GRAMS. Mr. President, I rise in strong support of H.R. 4444, 
which grants permanent normal trade relations--PNTR--to China. We 
should have passed this in early June, and I deeply regret the delay 
and hope we can expedite the House bill without amendments.
  I believe this is a no brainer. China negotiated a WTO accession 
agreement with the United States--an agreement in which China has 
committed to improve market access for most U.S. products and services 
to China. In exchange, the one thing we are required to grant them is 
PNTR--the same treatment all WTO members afford each other.
  The U.S.-China WTO agreement is a good one. China has made 
commitments in nearly every sector of our economy--agriculture, goods 
and services. Strong enforcement measures were included which allow us 
to not only continue use of our strong trade

[[Page 17055]]

remedy laws, but China has agreed to allow us to use a tougher 
safeguard standard than our current ``201'' law and continued use of 
tougher antidumping laws. This will help us enforce the agreement and 
generally allow us to use very tough trade remedy laws to address 
dumping and import surges.
  U.S. competitiveness will also be protected since China has dropped 
its requirement that U.S. companies transfer technology in order to 
export or invest in China. Exports to China will no longer require 
Chinese components or performance requirements. China will allow 
competition through imports for the first time. U.S. exporters can sell 
directly rather than using a government distribution system. It has 
made commitments on intellectual property enforcement as well.
  For the first time, China will be subject to the multilateral trade 
disciplines of the WTO. Any WTO member can enter into the dispute 
settlement process with China if China does not live up to any of its 
bilateral commitments. We can still use our trade remedy laws against 
China if necessary, and the Administration has tripled resources to 
monitor and enforce the U.S.-China WTO accession agreement.
  Some may say this week that we can continue our annual Jackson-Vanik 
review of China and still receive the benefits of the U.S.-China 
agreement--or they will say the 1979 U.S.-China Bilateral Agreement 
will provide the same benefits as the 1999 agreement. They will claim 
we need the annual review to achieve progress on human rights, nuclear 
proliferation and other areas of differences we have with China. 
However, virtually none of the concessions achieved in the 1999 
agreement are covered in the 1979 agreement. And we will not receive 
the benefits under the 1999 agreement if we do not grant China PNTR. 
The annual review is not responsible for the progress we have made in 
China--so it is time to end it.
  Let's examine what PNTR will mean to U.S. farmers and workers. A 
Goldman Sachs estimate indicates U.S. exports to China will increase by 
$14 billion per year by 2005. In 1998, U.S. exports to China exceeded 
$14 billion, which supported over 200,000 high-wage American jobs. 
Therefore, exports will more than quadruple by 2005--and the potential 
is enormous as China continues to grow in the future. USDA projects 
China will account for over one-third of the growth in U.S. ag exports 
in the next ten years. It will spend over $750 billion for new 
infrastructure projects.
  Since the benefits for Minnesota my home state are particularly 
important to me, I want to use that as a reference, but I think it 
represents other States and their opportunities as well. Minnesota's 
exports to China in 1998 tripled the 1996 volume. China is now 
Minnesota's 12th largest export destination, up from 22nd in 1993. We 
are now exporting 25 product groups compared to 21 in 1993. There are 
many farmers and workers who will benefit from the projected growth in 
agriculture and infrastructure project sales in China.
  Overall, America's farmers will prosper with an end to corn export 
subsidies, increased corn and wheat quotas, reduced tariffs from an 
average of 31 percent to 14 percent with greater decreases on soybeans, 
beef, pork, poultry, cheese, and ice cream. For example, my home State 
of Minnesota is the third largest soybean producer in the courtry, and 
China is the largest growth market for soybean products. Minnesota is 
the fourth largest feed corn producer, and the tariff-rate quota for 
corn will expand by 2004. China consumes more pork than any other 
country and will lower its pork tariffs and accept USDA certification. 
This is a huge boon for Minnesota pork producers. Cheese tariffs will 
be reduced from 50 percent to 12 percent, which will benefit Minnesota 
dairy farmers. Potato product tariffs will also be cut in half 
benefiting Minnesota's potato farmers and processors. Vegetable 
producers will see their tariffs drop up to 60 percent by 2004. And 
fertilizer and all ag products can now be distributed without going 
through a Chinese middleman.
  Tariff reductions will help other Minnesota workers export more in 
the areas of ag equipment, forest products, medical equipment, 
scientific, and measuring instruments, computers, pumps, machinery of 
all kinds and environmental technology equipment. PNTR will open 
markets for our banking, insurance, telecommunications and software 
services. In fact, the Coalition of Service Industries states:

       It will enable U.S. service industries to begin to operate 
     in one of the world's most important--and until now, most 
     restricted--markets in the world.

  Minnesota's largest exports to China now are industrial machinery, 
computers, and food products. And exports from small- and medium-sized 
businesses will expand. Right now Minnesota exports 55 percent of its 
total exports to China from small and medium businesses. Crystal Fresh, 
American Medical Systems, Inc., Image Sensing Systems, Inc., Minnesota 
Wire & Cable, ADC Telecommunications, Brustuen International, and Auto 
Tech International are among Minnesota's smaller companies with success 
stories to tell. Their China markets are expanding, and the 1999 
agreement will only increase their potential. Of course we have long-
time exporters such as Honeywell, 3M, Cargill, Pillsbury, Land O'Lakes, 
and many others who will be able to expand their exports to China as 
well.
  You have heard that the 1999 agreement will not produce overnight 
results, but I believe it will produce some short-term positive 
results. And the best benefit will be the longer term prospects. It is 
important to continue building commercial relationships for the future 
in order to reap those longer-term benefits. If we are not there early 
on, we may miss out on important future gains. As China develops and 
more of its citizens improve their earning power, they will demand more 
food products, goods and services. PNTR will allow U.S. firms the 
opportunity to compete for their business.
  I would now like to address some of the concerns of our labor union 
friends who believe PNTR will result in huge job losses in the U.S. 
That is curious to me since the U.S.-China WTO accession agreement is 
one sided. Union leaders cite an Economic Policy Institute--EPI--study 
alleging at least 872,091 jobs will be lost between 1999 and 2010, but 
the EPI study assumes every Chinese import displaces domestic 
production. However, a CATO analysis shows most of our imports from 
China substitute for imports from other countries or are inputs used in 
the U.S. to produce final U.S. products. If a rising trade deficit 
causes job losses, why are our unemployment rates the lowest they have 
been in 30 years?
  The Institute for International Economics also indicates that most of 
the growth of the U.S.-China trade imbalance is due to China taking 
market share from other East Asian economies rather than from U.S. 
producers.
  The bilateral agreement includes greater protections against unfair 
imports than we currently have and it will eliminate many Chinese 
practices that have helped it stimulate its own exports as well as 
forcing many U.S. companies to invest in China. Any ``giant sucking 
sound'' we may have seen in the past will be reversed under the U.S.-
China WTO agreement. China will be forced to abandon many of its 
policies which did force or encourage U.S. companies to invest there. 
The agreement will grow U.S. jobs by allowing us to export more of our 
products from the U.S. rather than selling through U.S. investments in 
China.
  Union leaders also speculate that U.S. companies want to shift 
production to China to take advantage of labor rates ``as low as 13 
cents an hour.'' The average production worker wage at U.S. companies 
in China is $4 an hour and $9.25 for higher skilled workers. The World 
Bank indicates average Chinese wages grew by 343 percent between 1987 
and 1997, mainly due to China's engagement with other countries. I 
believe approving PNTR and allowing more trade with China would 
continue the trend toward higher wages for Chinese workers.
  A group of 12 academicians recently commented on China's low wages 
and stated that PNTR would help improve

[[Page 17056]]

China's labor standards. They discussed China's poverty as the main 
reason for low wages and often poor working conditions. They concluded 
child labor often is necessary to help families survive. They believe 
China's entry into the WTO will help it enforce and improve its own 
laws, and that opposing PNTR undermines China's efforts to improve its 
labor rights. They concluded by stating:

       Whoever may benefit from a sanctions approach to trade with 
     China, it will certainly not be Chinese workers or their 
     children.

  You will also hear claims that the U.S. is being flooded with 
products made by Chinese forced labor. Both our trade laws and the WTO 
prohibit forced-labor imports, and the U.S. Customs Service vigorously 
enforces our law.
  Union leaders also talk about PNTR as a reward to China, yet it is 
hard to see how the bilateral agreements negotiated by China to enter 
the WTO are a reward. Many, many concessions were made, and those 
commitments are binding and will be vigorously enforced bilaterally and 
through the WTO.
  I hope union members, who will benefit from the U.S.-China WTO 
agreement, will listen to their elder statesman Leonard Woodcock, who 
stated recently:

       I have been startled by organized labor's vociferous 
     negative reaction to this agreement . . . in this instance, I 
     think our labor leaders have got it wrong. . . . American 
     labor has a tremendous interest in China's trading on fair 
     terms with the U.S. The agreement we signed with China this 
     past November marks the largest single step ever taken toward 
     achieving that goal.

  In my State of Minnesota, Governor Jesse Ventura, in his March 
testimony before the Ways and Means Committee, also sent union leaders 
a message. The Governor said:

       They (unions) better modernize themselves and realize that 
     opening up China to our trade is going to create more jobs 
     here. . . .

  I have spoken to union members and others who are also concerned 
about labor and environmental practices in China. While China, as a 
developing country, has a way to go on these issues, they certainly 
have made some progress as well. And I am proud that American companies 
investing in China have created better jobs, higher wages and better 
working conditions and have begun to serve as a model for their Chinese 
counterparts. Many U.S. companies have ``best practices'' of 
environmental, health, and safety standards which provide good job 
opportunities for many Chinese citizens. Housing, meals, insurance, and 
medical care are often included in their employment.
  Here is what a Chinese employee of one American company in Shanghai 
stated:

       I, a common girl, with no power and no money, could hardly 
     imagine all these things could be done several years ago . . 
     . don't let the friendship become cool (U.S.-China). Many of 
     the Chinese people are longing for knowledge, techniques and 
     culture from western countries, especially U.S.

  An employee of another American firm in China stated:

       . . . when our local company merged two years ago, my 
     salary was increased five or six times . . .

  Another worker said:

       After I joined the company, my family's life and living 
     standard improved, I have some deposit in the bank and bought 
     a new apartment which is big enough for my family.

  You will hear a lot during this debate about how we are pandering to 
U.S. companies who want to trade with China, ignoring all of our 
concerns with China. However, as noted previously, there are many 
examples of how American companies are helping Chinese citizens improve 
their lives, and as China privatizes more of its state-owned 
industries, the new owners will look to our companies as an example of 
how to succeed. I strongly believe American companies care about their 
employees and that they do not invest abroad to exploit local workers 
and ruin the environment. I believe American companies help bring about 
positive changes in China and other nations, and the exposure to 
Western ideals and values they bring to China includes a better work 
experience for those they hire. In fact, American companies are taking 
their responsibility seriously by setting up programs in their Chinese 
subsidiaries addressing issues from fair labor practices and 
environmental standards to community involvement.
  For those concerned about human rights, I again ask why they believe 
human rights would be aided by isolating ourselves from China. 
Maintaining relationships with the Chinese people through trade and 
other contact I believe is the best way to help the Chinese people help 
themselves. They are the ones who will promote changes from within that 
will improve their lives. Even Martin Lee, the Chairman of the 
Democratic Party of Hong Kong, who has long fought for human rights in 
China, recently stated:

       The participation of China in the WTO would not only have 
     economic and political benefits, but would also serve to 
     bolster those in China who understand that the country must 
     embrace the rule of law.

  The Dalai Lama, also long critical of China's human rights practices, 
especially in Tibet, states:

       Joining the World Trade Organization, I think, is one way 
     (for China) to change in the right direction . . . I think it 
     is a positive development.

  Some believe granting PNTR will help promote hardliners in China's 
leadership. However, a Washington Post story earlier this year noted 
that China analysts have found hardliners, including PLA officials, 
worrying that WTO membership will privatize more of China's economy and 
import more western ideas about management and civil society which they 
see as a threat to those who want to ensure the longevity of the one-
party Communist state.
  The U.S. should be part of this, through the granting of PNTR. While 
China will become a member of the WTO with or without us, I would 
certainly prefer the U.S. have a part in using our improved trade 
relationship as a way to make progress on our differences with China.
  Many human rights activists support China PNTR. Former political 
prisoner Fu Shenqi says:

       I unquestionably support the (view that NTR and the human 
     rights question be separated because) the annual argument 
     over NTR renewal exerts no genuine pressure on the Chinese 
     communists and performs absolutely no role in compelling them 
     to improve the human rights situation . . .

  The China Democracy Party, founded two years ago, issued a statement 
including:

       . . . We declare hereby to support the Unconditional PNTR 
     to China by the U.S. government.

  Zhou Yang, Executive director of the China Democracy and Freedom 
Alliance, states:

       Granting PNTR to China is a positive force in promoting 
     China's recognition of world human rights and in improving 
     the human rights situation of the Chinese people.

  Noted Chinese human rights activist Bao Tong was more direct, saying: 
``Pass permanent normal trade relations with China . . .'' and adding, 
``But in the U.S., the `Seattle coalition . . . have combined their 
lobbying firepower to oppose the move (PNTR). From here in China, their 
intellectual counterparts are looking on in dismay . . . it doesn't 
make sense to use trade as a lever. It just doesn't work.'' There are 
many others with similar advice.
  Included in the definition of human rights is religious persecution. 
While religious leaders remain concerned about the recent report from 
the U.S. International Religious Freedom Commission, which points out 
China has a long way to go toward religious freedom, they point to 
progress as well. A letter signed by 13 religious organizations 
concluded:

       Change will not occur overnight in China. Nor can it be 
     imposed from outside. Rather, change will occur gradually, 
     and it will be inspired and shaped by the aspirations, 
     culture and history of the Chinese people. We on the outside 
     can help advance religious freedom and human rights best 
     through policies of normal trade, exchange and engagement for 
     the mutual benefit of peoples of faith, scholars, workers and 
     businesses. Enacting permanent normal trade relations with 
     China is the next, most important legislative step that 
     Congress can take to help in this process.

  As you know, the House has attached a Commission on China to PNTR,

[[Page 17057]]

which would monitor human rights progress with an annual report. It 
would set a U.S. objective to work to create a WTO mechanism to measure 
compliance, and requires an annual USTR report on the PRC's compliance 
with the 1999 agreement and also authorizes additional staff to monitor 
China's compliance. It also includes sense-of-the-Congress language 
that China and Taiwan should enter the WTO at the same time.
  The bottom line is PNTR is easy. China had to do all the heavy 
lifting. We gave up noting in these negotiations, and PNTR doesn't 
force us to give up anything. I urge my colleagues to oppose all 
amendments offered in an attempt to either slow down or kill PNTR. 
While the amendments point out problem areas we have with China, these 
matters should be, and are, addressed separately in high-level contact 
between our two countries. I address them as well in contact I have 
with Chinese officials.
  Particularly, I urge you to oppose the Thompson-Torricelli amendment. 
While I will have a much longer statement once that amendment is 
offered, I will only say now that this amendment in any form will drive 
a wedge through our efforts to improve our relationship with China. It 
will foster a relationship of mistrust that will not help us improve 
China's proliferation record or its record on any other differences. 
The amendment is counterproductive. The amendment will not accomplish 
its goal of reducing proliferation, and it will create hostility 
between our countries. As Henry Kissinger stated:

       If hostility to China were to become a permanent aspect of 
     our foreign policy, we would find no allies. Nationalism 
     would accelerate throughout the region. Just as American 
     prestige grew with the opening to China, most Asian nations 
     would blame America for generating an unwanted cold war with 
     Beijing.

  This amendment will force us on the path of a cold war most of us 
never want to see again. Also, there have been so many drafts of this 
amendment, I am not sure any of us will really know what we are voting 
on. An amendment as controversial as this one deserves to go through 
the usual congressional committee process, and not be offered in a 
highly politicized matter on the Senate floor.
  There has been progress with China and proliferation, human rights 
and other issues. Let's work with China toward further progress--and 
use the laws we already have, if necessary, to address lack of 
progress. Above all, let's not use trade as a weapon. Let's pass PNTR 
to provide our workers and farmers the benefits of the U.S.-China WTO 
agreement. This should be one of the easiest trade votes we will ever 
take. Let's vote on H.R. 4444 without amendment now--this week--not 2 
weeks from now.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER (Mr. Burns). The Senator from Arkansas.
  Mrs. LINCOLN. Mr. President, I, too, am here to speak on the issue of 
permanent normal trade relations with China.
  In order to be successful in today's global economy, every industry 
must market its products overseas. And in order for the United States 
to continue the unprecedented economic growth we have seen during the 
last few years, we must adopt policies that open international markets 
for farmers, small businesses, manufacturers and service industries.
  On November 15 of last year, our Government successfully negotiated 
an historic trade agreement with the People's Republic of China that 
will bring China into the World Trade Organization. The potential 
impact of this arrangement cannot be overstated. China is home to one-
fifth of the world's population and is growing by 7 percent each year. 
Access to China's enormous population will help sustain American 
economic growth.
  But before the United States and Arkansas can reap the full benefits 
of this agreement, Congress must vote to grant China Permanent Normal 
Trade Relations status. The WTO requires that its members extend normal 
trade relations to all other members.
  There is a lot at stake depending on whether or not the United States 
grants PNTR to China. Since February, I have been urging the Senate 
leadership to bring this issue up for a vote as soon as possible. I had 
hoped that we would approve this legislation prior to the August 
recess, but nevertheless, I am anxious to finish work on this bill as 
soon as possible and get it on the President's desk for signature. 
There are so many things at stake. We must not lose this opportunity.
  China will join the WTO regardless of the congressional decision on 
PNTR, so a decision to deny this new status to China will only give 
China license to keep its markets closed to U.S. services and 
agriculture, and to keep its high tariffs in place on U.S. goods and 
services while opening it up to all other WTO members.
  All sectors of our economy, especially agriculture, will benefit from 
increased trade with China. Likewise, all sectors of our economy will 
suffer if we don't trade with China. Chinese accession into the WTO 
could mean $2 billion more a year in national agricultural exports to 
China by the year 2005.
  On U.S. priority agricultural products, tariffs will drop from an 
average of 31 percent to 14 percent. China will also expand access for 
bulk agricultural products, permit private trade in these products, and 
eliminate export subsidies. In my home State of Arkansas, rice, 
poultry, soybean and cotton producers will stand to reap enormous 
benefits from opening markets with China, including lower tariffs and 
increased trade. For instance, under its WTO accession agreement, China 
will cut tariffs on rice to 1 percent. Also, China is already the 
second leading market for U.S. poultry exports. If Congress approves 
PNTR status, it will cut tariffs in half from 20 percent to 10 percent 
by the year 2004 for frozen poultry cuts.
  In addition to the agricultural changes, China's tariffs on American 
industrial goods will fall from an average of about 25 percent to less 
than 10 percent within 5 years. Industries including 
telecommunications, banking, insurance, reinsurance, and pensions will 
all gain expanded market access. In information technology, tariffs on 
products such as computers, semiconductors and all Internet-related 
equipment will decrease from an average of 13 percent to zero by the 
year 2005.
  In exchange, the U.S. gives up nothing; our trade policies remain the 
same. The economic reasons make so much sense and are themselves a very 
powerful reason for passage of PNTR.
  But the opportunity we have as a nation to make an impact on the 
humanity of China only exists if we are engaged with the country and 
its people. We cannot build a relationship that is effective if we turn 
our backs on China and isolate them.
  Is China a perfect country? No.
  I too share the concerns about human rights abuses in China and 
believe that a greater international presence in the country, fostered 
by free trade, will help to improve the lives of Chinese workers and 
citizens. WTO membership will strengthen the forces of reform inside 
China by exposing the Chinese to better paying jobs, and higher labor 
and environmental standards.
  Finally, permanent normal trade relations with China will force the 
Chinese to play by the rules in the international marketplace.
  Only under this agreement with their accession into the WTO will we 
have the proper recourse to be able to question their practices.
  The WTO's dispute settlement system will force China to explain its 
actions if other member countries question them. In addition, the WTO's 
trade policy review mechanism will allow all other members to review a 
country's entire trade system. This type of scrutiny of China is 
virtually unprecedented in history.
  If we do not approve PNTR status for China, the missed opportunities 
will be tremendous, not to mention the devastation it could have on our 
strong economy today. Our producers and industries will not be in a 
position to openly access the 1.3 billion people who live in China. The 
United States will not have the ability to challenge China's trade 
practices or demand better

[[Page 17058]]

human rights practices. In short, the United States stands to gain 
enormously if we grant PNTR status to China, and we stand to lose 
enormously if we do not.
  Certainly once China does enter the WTO, there will still be many 
challenges ahead for all of us, but congressional approval of PNTR for 
China is a critical first step. It means so much to this Nation and to 
my home State of Arkansas. We must take this first step in passage of a 
good, clean PNTR bill in the Senate. Having China in the WTO is a good 
deal for Arkansas and a good deal for this Nation.
  I encourage my colleagues to approve the House-passed bill granting 
permanent normal trading relations with China--soon, not later--and 
that we send it to the President to be confirmed so we can continue 
building a relationship which will benefit both countries.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. FEINGOLD. 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. FEINGOLD. I rise today, Mr. President, to express my opposition 
to granting permanent normal trade relations to the People's Republic 
of China.
  The recent history of U.S.-China relations has been a study in self-
delusion. The administration and this Congress do not lack for evidence 
or information about the nature of the Chinese government. But I am 
afraid the siren song of vast Chinese markets has deafened too many 
ears to the news of oppression and abuse inside China. Too often, the 
U.S. has chosen to ignore the realities before us and, as in this trade 
debate, has engaged in political and intellectual contortions to 
compartmentalize and seal off a host of important issues so that the 
promise of vast profits can stand alone and unencumbered.
  But I urge my colleagues to remember today--the mythological sirens' 
song served to lure sailors onto the rocks that crushed their ships. 
And refusing to look at the whole picture of U.S.-China relations in 
the single-minded pursuit of trade is, I submit, both foolish and 
dangerous. I fear that this country will find its policy in shambles 
unless we force ourselves to see the facts before us.
  The fact is that China continues to be one of the most oppressive 
states in the world.
  The State Department acknowledges that the human rights situation in 
China has deteriorated over the past year--a year in which the U.S. has 
extended normal trade relations with China, casting doubt on the claims 
that trade will lead to greater openness and therefore greater civil 
and political rights in China.
  The list of abuses committed by the Chinese government is so lengthy, 
so encompassing, as to be numbing. Thousands of political prisoners 
remain in prison--many sentenced after unfair trials or no trial at 
all. Torture is regularly used to extract ``confessions'' from 
detainees. Authorities continue to use the brutal laogai system of 
``reeducation through labor'' to detain dissidents and others deemed 
dangerous to this paranoid state. Religious freedom does not exist in 
China; from global faiths like Catholicism to more obscure sects, the 
leadership in Beijing has sought to force its will and its agenda on 
spirituality. Nowhere is this more egregious than in Tibet, where 
thousands of monks and nuns still are arbitrarily detained, where 
something termed ``patriotic education'' is forced on Tibetans at their 
monasteries, where individuals have been arrested and sentenced to 
imprisonment for activities such as displaying the banned Tibetan flag, 
where an entire culture is at risk. And forced abortion and forced 
sterilization are realities in the PRC.
  The Chinese government has waged a campaign to destroy all sources of 
dissent. Leading members of the China Democracy Party have been 
sentenced to lengthy prison terms for ``conspiring to subvert state 
power.'' Activists in Xinjiang have been the target of a campaign of 
arrests, substandard trials, and executions. Leaders of laborers and 
peasants daring to call for worker's rights are detained. Expression, 
in virtually all of its forms, is restricted. The government of China 
has zealously launched into a campaign to monitor and control content 
on the internet. According to Human Rights Watch, ``last fall, local 
newspapers and magazines were put under Communist Party control. And 
the State Press and Publications Administration banned foreign 
investment in wholesale book publication and distribution, and limited 
the right to distribute textbooks, political documents, and the writing 
of China's leaders to a handful of enterprises.''
  My colleagues, this is the state that seems so promising to the 
supporters of PNTR. This is the China with which we are urged to 
engage. This is to be our full partner.
  That very abbreviated list of abuses sounds awfully bad, doesn't it? 
But the Administration's material on PNTR sounds so good. It is full of 
promises and optimism. How, I wonder, do they imagine getting from here 
to there--to that promised land in which our relationship with China is 
all about good news and profits?
  I would suggest that the influence of money in politics goes a long 
way toward explaining the peculiar nature of this debate and U.S. 
policy toward China more broadly.
  The push for PNTR legislation is one of the most expensive lobbying 
campaigns in history. Business interests are pitted against labor 
unions, as they make PAC and soft money contributions, and wage huge 
lobbying campaigns on television and in the halls of Congress. So 
before we go any further with this legislation, I would like to Call 
the Bankroll on the PNTR issue, to give my colleagues and the public an 
idea of the spending spree that has gone on to lobby us on this bill.
  Labor unions have donated heavily to the parties as they have fought 
against Permanent Normal Trade Relations with China. The Center for 
Responsive Politics estimates labor's overall soft money, PAC and 
individual contributions at roughly $31 million so far in this election 
cycle in a May 24th report. In particular, the AFL-CIO and its 
affiliates, which have campaigned hard against PNTR, have given $60,000 
in soft money through the first 15 months of this election cycle.
  And then there's the other side of the debate. On the side of PNTR we 
find corporate America, which, according to a New York Times report, 
engaged in its ``costliest legislative campaign ever'' to win this 
fight--including an $8 million advertising campaign. The ``costliest 
legislative campaign ever'' by corporate America--now that's saying 
something.
  As we know, corporations typically spend the most in the political 
money game, and often win as a result. And it looks like PNTR will be 
no exception, Mr. President.
  For example, take the Business Roundtable, a well-known business 
coalition eager to get this bill passed. The Center for Responsive 
Politics' May 24th report put the collective contributions of Business 
Roundtable members at $58 million in soft money, PAC money and 
individual contributions so far in the election cycle. And that is in 
addition to the Roundtable's $10 million dollar advertising campaign to 
push PNTR, according to the Center.
  Business Roundtable members are corporations like Boeing, Philip 
Morris, UPS and Citigroup. These are heavy hitters who regularly write 
checks to the political parties for $50,000, $100,000, even a quarter 
million dollars. These companies have to ante up to stay in the game, 
Mr. President--PNTR is a high stakes game, and the ante is bigger than 
ever.
  I will quickly run down the soft money contributions of these 
companies, Mr. President. These are huge numbers, and they are just 
through the first 15 months of this election cycle: Boeing has given 
more than $465,000 in soft money through the first 15 months of the 
election cycle, including 10 contributions of $25,000 or more.
  UPS, its subsidiaries and executives have given more than $960,000 in 
soft

[[Page 17059]]

money through March 31st of the current cycle. That includes two 
contributions of a quarter million dollars.
  Citigroup, its subsidiaries and executives gave more than one million 
dollars in soft money through the first 15 months of this election 
cycle, including six contributions of $50,000 or more.
  And of course who could forget Philip Morris, Mr. President? Long 
known as the granddaddy of political donors, Philip Morris and its 
subsidiaries have given more than $1.2 million in soft money through 
March 31st of the election cycle, including more than eight donations 
of $100,000 or more.
  Since I've mentioned Philip Morris' contributions here, let me take a 
moment to discuss the impact of contributions of large multinational 
corporations with many legislative interests. Some might argue that is 
unfair to mention Philip Morris in this calling of the bankroll because 
its main interest is tobacco legislation.
  That is exactly the beauty of soft money contributions from the point 
of view of the corporate donor. They buy access for the company that 
makes them. They aren't payment for a particular piece of legislation. 
No, they are more powerful than that because they are so large, and so 
sought after by the parties. They further the interests of that company 
on all pieces of legislation. There can be no doubt that Philip Morris 
has an interest in PNTR.
  China is a huge untapped market for cigarettes. So Philip Morris's 
soft money contributions open the doors for its lobbyists on this 
issue, just as they open the doors for its anti-tobacco control 
arguments.
  Everyone knows that PNTR is the very top legislative priority for the 
business community in this country. There is absolutely no dispute 
about that. The lobbying effort has been extraordinary. And Philip 
Morris's legislative and lobbying muscle, supported by their huge 
campaign contributions, have been put at the service of that priority, 
as well as of its own particular interest in tobacco legislation.
  Mr. President, corporations such as Philip Morris, and the other 
members of the Business Roundtable pay to play--they get visibility in 
the debate, and they get their voices heard loud and clear. The shape 
of the PNTR debate so far is exactly what we should expect from a 
campaign finance system that is rigged to value money above all else.
  So it is clear that some people do stand to gain from PNTR and 
China's accession to the World Trade Organization. But I think that 
camp has vastly overstated its case. These forces, which have paid to 
pipe the siren song into the halls of the Senate for months now, claim, 
for example, that America's farmers will benefit greatly from PNTR for 
China. They wave impressive graphs, they promise access to vast 
markets. But I for one, as a Senator from a very important agriculture 
state, am not convinced that those claims are more than just empty 
promises. China's Vice Minister of Trade has already noted publicly 
that market-opening promises for U.S. wheat exporters are only a 
theoretical opportunity--not an actual one. The fact is that China's 
promises to import more agricultural products conflict with internal 
Chinese political and cultural dynamics--dynamics that are affected by 
longstanding fears about dependence on foreign food and by employment-
creation imperatives. China has produced a glut of agricultural goods 
for years. Beijing now has massive stockpiles and a three-to-one ratio 
of exports to imports. Chinese prices will likely continue to be lower 
than American ones for years. I am not convinced that there is a big 
pay-off in store for American agriculture.
  Ask Wisconsin's ginseng growers about the Chinese commitment to rule-
governed trade. They will tell you that the Chinese have continued to 
mislabel their ginseng as ``Wisconsin-grown ginseng.'' As a result of 
this misleading practice, the price paid to actual American ginseng 
farmers has steadily declined. Recent press reports even suggest that 
the Chinese are now smuggling ginseng containing dangerously high 
levels of harmful pesticides and chemicals into U.S.--again 
inaccurately labeled as Wisconsin ginseng.
  I concede, Mr. President, that profits are within the reach of some. 
And I recognize that the business community is responsible to its 
shareholders. Seeking profitable opportunities is their very purpose, 
and there is nothing wrong with that. But this Senate is responsible to 
all of the citizens of the United States, to the core values of this 
country, and to future generations of Americans. And the United States 
of America does not stand only for profit. Even if I were convinced 
that Permanent Normal Trade relations with China and Beijing's 
accession to the WTO would bring significant new economic opportunities 
to a large number of Americans--and I am not convinced of this fact--I 
still believe it is my responsibility to weigh that factor against 
others--including the fact that the Chinese government's human rights 
record is unquestionably appalling. I still believe that certain 
economic gains are not worth their moral price. I still believe that 
the prosperity we all seek for our great country should never be a 
prosperity that also brings shame.
  But de-linking trade from human rights and prohibiting an annual 
debate on this issue suggests that I do not have the right to weigh 
these factors, that I cannot consider the totality of U.S.-Chinese 
bilateral relations when matters of trade arise. Apparently, we are all 
simply supposed to follow the music.
  I argue that to compartmentalize our national values is to cordon off 
our national identity, to subordinate what we stand for so completely 
that it no longer affects how we behave. That is dangerous. I think it 
is an abdication of the responsibility I accepted when I took this 
office.
  So apart from the question--and it is a good question, a question not 
answered nearly so easily as the Administration would like--of whether 
or not a significant number of Americans will reap economic benefits 
from PNTR for China--and apart from legitimate questions grounded in 
the historical record about whether or not China will stick to its 
trade-related commitments--apart from these issues, we are debating 
whether or not to draw a sharp, impenetrable division between one of 
our interests--economic gain--and what we believe and who we are. That 
is the question that has been evaded in the mountains of pro-PNTR 
literature and the countless pro-PNTR briefings that have become a 
fixture on Capitol Hill in recent months. I cannot support such a 
division. I will not abdicate my responsibilities in the hopes of 
avoiding tough choices and decisions. I cannot support this bill.
  I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. HOLLINGS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Smith of New Hampshire). Without 
objection, it is so ordered.
  Mr. HOLLINGS. Mr. President, in making opening comments relative to 
permanent normal trade relations with China, I feel compelled to sort 
of qualify as a witness in that we have over the years in these 
particular debates about international trade made very little progress, 
whether with Democratic administrations or Republican administrations.
  My rising in opposition and my amendments will be to the thrust of 
not having permanent and not having normal trade relations with anybody 
because our normal trade relations are a $350 billion to $400 billion 
trade deficit which is destroying the middle class in our society, 
weakening our democracy, and diminishing our influence in world 
affairs. With all of the pep talk about the wonderful economy, we are 
actually, on this particular score, in tremendous decline.
  I say ``as a witness'' in a sense because I can remember when 
southern Governors started computing. People up in New Hampshire and 
other places say that they are from down south and that they are blind 
protectionists; they

[[Page 17060]]

do not understand the importance of manufacturing and international 
trade and exports. So I hearken back to the day when I represented the 
northern textile industry from New Hampshire as well as the southern 
textile industry. I appeared before the old International Tariff 
Commission. Who ran me around the room? None other than Tom Dewey. This 
was back in 1960. The subject was textiles--that 10 percent of the 
American consumption of textiles in clothing was represented in 
imports, and if this continued at the pace that it was going, before 
long we would be out of business.
  By the way, they told me at that particular hearing: Governor, what 
do you expect? For those emerging Third World countries in the Pacific 
rim and everywhere else, what do you expect them to make? Let them make 
the shoes and the clothing, and we will make the computers and the 
airplanes.
  Fast forward 40 years: They are making the shoes. They are making the 
clothing. They are making the airplanes and they are making the 
computers. They are making all of it. Actually, we have high tech. I 
want to get into that in a minute. High tech--they think that is saving 
us. We have a deficit in the balance of trade with the People's 
Republic of China in high technology.
  This Congress doesn't have any idea where we are on this particular 
score. Everybody is outside talking about the new economy. True it is, 
we are all proud of that new economy, particularly on this side of the 
aisle. They were afraid to say they raised the Social Security tax in 
1993 when Clinton came into office. But I wasn't afraid. I brought it 
in line with all other pension plans. We are afraid to say we raised 
gasoline taxes. But we did. We cut spending $250 billion. The taxes 
that were supposed to be $250 billion are now up to $370 billion. Then 
we cut some taxes very minimally. We reduced the size of government by 
some 377,000 Federal employees.
  They have the new economy. But the new economy has a private side and 
a public side. The private side is doing extremely well. High 
employment, low unemployment, low interest rates, booming economy, 
booming stock market, strong bank system--but the public side is almost 
a disaster. I say that advisedly. The reason I say it is so that, for 
one thing, they are talking surplus, surplus. Everywhere, someone cries 
``surplus.''
  The public debt to the penny according to the U.S. Treasury 
Department shows that, as of September 1, the debt is $5.676 trillion. 
At the beginning of the fiscal year of September 30, 1999, it was 
$5.656 trillion.
  I ask unanimous consent to have this printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                      THE PUBLIC DEBT TO THE PENNY
------------------------------------------------------------------------
                                                         Amount
------------------------------------------------------------------------
9/01/2000.....................................     $5,676,516,679,692.56
Prior months:
  8/31/2000...................................      5,677,822,307,077.83
  7/31/2000...................................      5,658,807,449,906.68
  6/30/2000...................................      5,685,938,087,296.66
  5/31/2000...................................      5,647,169,888,532.25
  4/28/2000...................................      5,685,108,228,594.76
  3/31/2000...................................      5,773,391,634,682.91
  2/29/2000...................................      5,735,333,348,132.58
  1/31/2000...................................      5,711,285,168,951.46
  12/31/1999..................................      5,776,091,314,225.33
  11/30/1999..................................      5,693,600,157,029.08
  10/29/1999..................................      5,679,726,662,904.06
Prior fiscal years:
  9/30/1999...................................      5,656,270,901,615.43
  9/30/1998...................................      5,526,193,008,897.62
  9/30/1997...................................      5,413,146,011,397.34
  9/30/1996...................................      5,224,810,939,135.73
  9/29/1995...................................      4,973,982,900,709.39
  9/30/1994...................................      4,692,749,910,013.32
  9/30/1993...................................      4,411,488,883,139.38
  9/30/1992...................................      4,064,620,655,521.66
  9/30/1991...................................      3,665,303,351,697.03
  9/28/1990...................................      3,233,313,451,777.25
  9/29/1989...................................      2,857,430,960,187.32
  9/30/1988...................................      2,602,337,712,041.16
  9/30/1987...................................      2,350,276,890,953.00
------------------------------------------------------------------------
Source: Bureau of the Public Debt.

  Mr. HOLLINGS. Mr. President, that shows that the debt has increased 
$20 billion--no surplus. They don't want to say where they get the 
surplus from. I can tell you where they get the surplus from. We had an 
increased measure of taxation over the years. When we had the 1983 
Social Security settlement, we wanted it to increase to build up a 
trust fund to take care of the baby boomers in the next generation--
which is now. In 1992, the Social Security surplus was $50 billion; now 
the Social Security surplus is $150 billion.
  Over the last 8 years--because of what we did back in 1983--we have 
an additional $100 billion surplus, if you please, for the Social 
Security trust fund. We voted it here--section 13-301 of the Budget 
Act--that you shall not use Social Security surpluses in your budgets. 
Section 12 of the Greenspan commission said it should be set aside. It 
took us from 1983 until 1990 in order to get that done, but we finally 
got it done. Ninety-eight Senators voted for it. Almost all the Members 
of the House voted for it. It was signed into law on November 5, 1990, 
by President George Bush.
  But all of them are running around saying we are going to save Social 
Security while they are spending it with all kinds of monkeyshine 
plans--invest a little, invest a lot, do this, or do that to save 
Social Security. They set up the straw man in violation of the law--the 
policy of the Greenspan commission and talking about surpluses when 
there is not any surplus. The debt is increasing. If there is a 
surplus, why has the debt increased $20 billion? With all the wonderful 
income tax from which we had revenues on April 15, with all the good 
corporate tax revenues in June, we are still increasing the debt some 
$20 billion.
  All of them say tax cut, tax cut, but if you cut the estate taxes, 
you have increased the debt. All tax cuts are increasing the debt. They 
are all saying pay down the debt, pay down the debt. It is Alice in 
Wonderland. It is double talk. They are not talking sense with relation 
to what is actually going on.
  Everybody says we are paying down the debt. But they are for all of 
these taxes. Whether it is middle class, or targeted, or estate, or 
gasoline, or capital gains, or marriage penalty, any of those tax cuts 
under present circumstances obviously amount to an increase in debt. 
They talk about surplus that doesn't exist, and they talk about paying 
down the debt as they regularly increase it. They don't mention waste.
  As a result of this charade, interest costs have gone up to $366 
billion for this fiscal year. I remember when we balanced the budget in 
1968 and 1969 under President Lyndon Johnson. The interest cost on the 
national debt was less than $1 trillion; the interest cost was only $16 
billion. That was the cost of all the wars from the Revolution, to the 
Civil War, the Spanish-American War, World War I, World War II, Korea, 
Vietnam. We had a debt of less than $1 trillion and they had interest 
costs of only $16 billion. Now we are up to $5.7 trillion, with $1 
billion a day being spent. Wait until the whopping payment is made in 
September.
  I ask unanimous consent to have printed in the Record the interest 
expense as of this minute.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

            Interest Expense on the Public Debt Outstanding

       The monthly Interest Expense represents the interest 
     expense on the Public Debt Outstanding as of each month end. 
     The interest expense on the Public Debt includes interest for 
     Treasury notes and bonds; foreign and domestic series 
     certificates of indebtedness, notes and bonds; Savings Bonds; 
     as well as Government Account Series (GAS), State and Local 
     Government series (SLGs), and other special purpose 
     securities. Amortized discount or premium on bills, notes and 
     bonds is also included in interest expense.
       The fiscal year Interest Expense represents the total 
     interest expense on the Public Debt Outstanding for a given 
     fiscal year. This includes the months of October through 
     September.

                   INTEREST EXPENSE--FISCAL YEAR 2000
------------------------------------------------------------------------
                                                           Amount
------------------------------------------------------------------------
July..............................................    $19,332,594,012.00
June..............................................     75,884,057,388.85
May...............................................     26,802,350,934.54
April.............................................     19,878,902,328.72
March.............................................     20,889,017,596.95
February..........................................     20,778,646,308.19
January...........................................     19,689,955,250.71
December..........................................     73,267,794,917.58
November..........................................     25,690,033,589.51
October...........................................     19,373,192,333.69
                                                   ---------------------
    Fiscal Year Total.............................    321,586,544,660.74
------------------------------------------------------------------------


               AVAILABLE HISTORICAL DATA--FISCAL YEAR END
------------------------------------------------------------------------
                                                           Amount
------------------------------------------------------------------------
1999.............................................    $353,511,471,722.87
1998.............................................     363,823,722,920.26
1997.............................................     355,795,834,214.66
1996.............................................     343,955,076,695.15
1995.............................................     332,413,555,030.62
1994.............................................     296,277,764,246.26

[[Page 17061]]

 
1993.............................................     292,502,219,484.25
1992.............................................     292,361,073,070.74
1991.............................................     286,021,921,181.04
1990.............................................     264,852,544,615.90
1989.............................................     240,863,231,535.71
1988.............................................     214,145,028,847.73
------------------------------------------------------------------------

  Mr. HOLLINGS. It is $321 billion without the August and September 
payments. When we get those particular payments, it will go up, up, and 
away. And that is under low interest rate circumstances.
  We have the worst waste of all. I served on the Grace Commission 
under President Reagan. We were going to cut out waste, fraud, and 
abuse. Now we have caused the greatest waste of all.
  After President Clinton early this year made the State of the Union 
Address, the comment was made by the distinguished majority leader that 
it was costing $1 billion a minute. The President talked for 90 
minutes; that is $90 billion. Governor Bush wants to give a $90 billion 
tax cut. We could give President Clinton $90 billion in spending. We 
could give Governor Bush $90 billion in tax cuts and still have $170 
billion left for all the increases to the Department of Health, for 
class size reduction and school construction and any and every kind of 
research at NIH that we wanted.
  The point is, we are spending the money and we are not getting 
anything for it and we don't talk about it on the campaign trail. What 
do they avoid talking about? The $350 to $400 billion--and it will 
probably be nearly $400 billion--deficit in the balance of trade. The 
economists say that costs us at least 1 percent on our GNP. Instead of 
4.1, we would have 5.1, and more jobs.
  This is ignoring the failure of the United States to compete in 
international trade. I emphasize that for a reason, for those who say 
we are blind protectionists, that we don't understand the global 
economy, the global competition and do not want to compete and want to 
start a trade war. No. 1, we have been in a trade war and we have been 
losing. They don't understand that. No. 2, on globalization, I don't 
want to sound like the Vice President, but I helped invent it 40 years 
ago. I went as a young Governor to Europe. I have that Deutsche Telekom 
bill that they talked about in the paper the other day. The truth is, I 
called on the Germans in Frankfurt. Today we have 116 German industries 
in the little State of South Carolina. I will never forget calling on 
Michelin in downtown Paris in June of 1960 with 11,600 Michelin 
employees. We have Hoffman-LaRoche from Switzerland. And Honda broke 
ground a few years ago. I was amazed to hear that Honda produced and 
exported more vehicles than General Motors.
  I have been in public service 50 years. I have been debating this 
issue in all five textile bills that passed here. Four of them passed 
the House also and were vetoed by Presidents over the years. When we 
come to trade and globalization, I think it behooves me not to talk 
about permanent, not to talk about normal, but use this opportunity to 
sober up the Congress and the leadership of the United States, making 
them realize that we are in a real competition, but not for profit. 
That is, the American multinational. They could care less. They don't 
have a country. Boeing came out the other day and said in the United 
States, we are not a U.S. company but an international company. 
Caterpillar has been holding in Illinois. But they were international. 
They think it is fine. The Chamber of Commerce has forgotten about Main 
Street America and gone with the multinationals. NAM and the Business 
Roundtable--we are in the hands of the Philistines. We are losing our 
manufacturing base because we don't understand that the global 
competition is not for profit but for jobs and market share.
  Let me talk a minute about jobs. At the fall of the wall, 4 billion 
workers came from behind the Iron Curtain, ready to work for anything, 
anywhere, at any time. In the last 10 years, with computerization and 
satellites, you can transfer your technology on a computer chip, you 
can transfer your financing by satellite. You can produce anything 
anywhere that you please. That is the global competition and 
international trade.
  While our American producers for the so-called profit want to 
manufacture, say, in the People's Republic of China, for 10 percent of 
the labor costs than it is paying in the United States, we have been 
losing, losing, losing. In manufacturing, they say 30 percent of volume 
is in the cost of labor. Or you can save 20 percent of your volume by 
moving the manufacturer of your product offshore or down to Mexico. 
Simply put, you can maintain your executive and your sales force here 
but put your manufacturing elsewhere. If you have $500 million in 
sales, at 20 percent, before taxes, you can save $100 million. Or you 
can continue to work your own people and go broke because your 
competition is headed that way. That is the job policy of the U.S. 
Congress today. It is to accelerate the exodus and the export of jobs.
  I will never forget when they told us that NAFTA was going to create 
200,000 jobs. I just looked at the figure from the Bureau of Labor 
Statistics. It is more than just that 38,700 figure, but in textiles 
alone we have lost 38,700 jobs since NAFTA; in North Carolina, 90,000. 
I will never forget when they came down to Charlotte and said they 
wanted to talk about the digital divide. They are the ones dividing it. 
You think if you lost a job you are going out and buying a $2,000 or 
$3,000 computer? ``It's the economy, stupid.'' That is where we are. 
You just can't understand we are here, when they think it is a 
productivity thing on jobs: Productivity, productivity, productivity--
We have global competition.
  The U.S. industrial worker was the most productive industrial worker 
in the world, all during the 60s, all during the 1970s, all during the 
1980s, all during the 1990s, and is today still the most productive 
industrial worker. They are not the highest paid. They pay much more in 
Germany and a bunch of other countries--and I will have a word to say 
about that, where the rich are getting richer and the poor are getting 
poorer and the middle class is disappearing. But the point is, we are 
losing our manufacturing strength and capability. We are losing our 
economy.
  America's security and strength is like a three-legged stool. You 
have the one leg which is the values of a nation, and that is 
unquestioned. We commit for freedom in Somalia and down in Haiti, 
Bosnia, Kosovo. There are nine peacekeeping missions currently and we 
are adding four more around the world. People admire the United States 
of America and its high principles and values.
  The second leg is one of the military, and that is unquestioned.
  But the third leg is a fraud--intentionally so. You see, after World 
War II we had the only industry, so with the Marshall Plan, that really 
started globalization. We not only sent the money, we sent the 
technology and the expertise--and capitalism has defeated communism. In 
the People's Republic of China, which is the present subject, they are 
tending more every day towards capitalism. That is a wonderful thing.
  The question is, Can we afford to give away the store? We have 
sacrificed and sacrificed so that now Boeing of Seattle, WA is moving 
production of airplanes--the most prominent of export industries--out 
of the country. Why do you think the machinists at Boeing led the 
strike not to break up in Seattle last December? That was a crowd that 
came out of Oregon, if I remember correctly, the Ruckus Society, or 
something like that. But the AFL-CIO march, at that WTO meeting in 
Seattle in December was led by the Boeing machinists. Why? Because 70 
percent of the Boeing 777--McDonnell 90-10 is made overseas. In order 
to sell the Boeing plane in the People's Republic of China, according 
to Bill Greider, 50 percent of the Boeing 777 is made in downtown 
Shanghai.
  So we are losing the best, the best of the jobs. We know about jobs. 
We know about globalization. We are looking at this constant drain, so 
to speak, over the 50-year period. At the end of World

[[Page 17062]]

War II we had 41 percent of our workforce in manufacturing. Last month, 
we lost another 69,000 manufacturing jobs. Go to the Department of 
Commerce--ask them.
  So we have gone from 41 percent down to 12 percent. Akio Morita, the 
former head of Sony said: Wait a minute, that world power that loses 
its manufacturing capacity ceases to be a world power. That is why we 
stand opposed to permanent normal trade relations with China.
  I know full well--I live in the real world--we are going to have 
trade with China. I am not opposed to trade with China. I am opposed to 
permanent, normal. When I say ``permanent,'' that is exactly what these 
CEOs of the Fortune 500 companies want. Because they know if they go 
over and invest in China and it has been permanent, they can come back 
appealing, ``Don't change anything,'' and they can get a foothold there 
and they can really make a wonderful profit. But, of course, that puts 
us more and more in jeopardy because we cannot shout ``productivity'' 
to the most productive industrial worker while at the same time 
saddling him with all the penalties.
  What are the penalties? What are the costs of productivity? We, the 
Congress of the United States, say: Before you open up the XYZ 
manufacturing company you have to have a minimum wage, Social Security, 
Medicare, Medicaid, clean air, clean water, safe working place, safe 
machinery, plant closing notice, parental leave. We might add on 
prescription drugs. Everybody is for prescription drugs. That is the 
cost of doing business.
  You can go down to Mexico for none of that, 58 cents, $1 an hour. You 
can go, for 10 percent of the cost, to China. We run around here like 
we understand something when we are totally off base, operating in the 
dark, on one of the most important issues confronting the United 
States. They think: Technology, high tech, high tech. Let's talk about 
jobs. High tech jobs? Do you know that a third of Microsoft's workers 
are part time? At one time they were all full time and lower-level 
workers sued and said: We are going to get some of these stock options 
and other benefits. And they won the case in court. So Gates and 
Microsoft turned around and gave them a 364-day contract. They are part 
time; 40 percent of the employees in Silicon Valley are part time. They 
don't give them any jobs. Gates has 22,000 up there in Redmond, WA and 
Boeing has 100,000. But what jobs they do have don't produce anything 
to export.
  We had a deficit balance of trade in advanced technology products 
with the People's Republic of China of $3.5 billion in 1999. This year 
it will be almost $5 billion. So don't give me anything about high 
tech--the high tech is going to save us. That is not going to save us 
at all. Advances in technology has spurred productivity. We all 
acknowledge that. The Japanese, after all, are the ones that taught us 
that with their advances in robotics in the early 80's. The BMW plant 
in Spartanburg, SC has been able to incorporate cutting edge technology 
and machinery. That is why over half the employees came off the farms 
within 50 miles and the other little textile industries and have been 
able to produce very efficiently. The quality of the Spartanburg plant 
exceeds the quality of Munich BMW. As a result, BMW is doubling the 
size of its operations at the Spartanburg plant.
  Open your eyes. The most productive automobile plant in the world, 
according to J.D. Power, is not in Detroit, it is down in Mexico--the 
Ford plant. We know about productivity and we know about jobs. While we 
lost 69,000 manufacturing jobs this August, we took on some 127,000 
service jobs. We are going just the way of England.
  At the end of the war, they told the Brits: Don't worry; instead of a 
nation of brawn, this will be a nation of brains; and instead of 
producing products, we will provide services. Instead of creating 
wealth, we will handle it and be a financial seller. And England has 
gone to hell in an economic hand basket. Even Land Rover is leaving 
there now, and there is some question with the BMW plant there.
  I am not anti-British. I love the Brits. But London has become a 
downtown amusement park. I like to go there like everybody else. What I 
am talking about here is economic strength. The British Army is not as 
big as our Marine Corps. We are running around here puffing and blowing 
about the world's superpower. You cannot use and you would not use the 
hydrogen bomb. They couldn't care less now about the 6th Fleet or our 
military superiority.
  So what counts? Money. Money talks in international affairs. I will 
never forget when in the U.N. there was a resolution to examine China 
with respect to human rights and they were preparing to set up the 
hearings. This was 1993.
  The last time I checked 5 years later, 1998, they did not have the 
hearings. Why? Because the Chinese are the best diplomats. The Chinese 
are the best negotiators. They are the best business people. They have 
the best commercial minds. They went all around Africa, down into 
Australia and everywhere else. They never called for the hearings. Why? 
Because everybody wants to get into that rich market of $1.3 trillion. 
At the moment, we have the richest market in the world, and we refuse 
to use it and whine: Be fair, fair trade, level the playing field.
  Come on. Trade is not Boy Scouts. There is no morality to trade--be 
fair. I know what they are talking about. I know the word ``trade'' 
itself. ``Free trade'' is an oxymoron, but they hope there will be no 
barriers, no tariffs, no limitations.
  As we shout for free trade, the same thing we shout for is world 
peace. I do not believe we are going to get either one in my lifetime. 
Maybe in Strom's. The fact of the matter is, the father of this country 
said the best way to preserve the peace is to prepare for war. The best 
way to get free trade is to compete, raise the barriers and then remove 
them. The Chinese do that. They use their market.
  Some come to the floor and talk at length with respect to how the 
agreement is so good and it will not do this and it will not do that. I 
will touch on one thing this afternoon because I am limited in my time. 
My colleagues will remember, they said there would not be any more 
forced technology transfers. That is what Qualcomm thought when it 
invested in China. Ambassador Barshefsky, the Special Trade 
Representative, said:

       The rules put an absolute end to forced technology 
     transfers.

  This was November of last year after they had the agreement. I have 
an article from the Wall Street Journal with regard to ``Qualcomm 
learns from its mistake in China'':

       U.S. mobile phone maker listens to Beijing's call for local 
     production.

  This is dated June 7 of this year. The Ambassador is telling us the 
agreement does one thing, but the reality is quite another. Qualcomm, 
trusting it would not have to transfer, has to have local production 
before it can sell. So it is with all of these other industries.
  I am not anti-Chinese. I am anti this policy. I have been against 
this particular policy for years on end. We had a GAO report--about 
which I could go on at length--that the agreement is indecisive and 
complex. When we negotiate, we find out again and again it is normal 
trade relations; namely, you have to give before you can take. You have 
to give the Chinese the technology, and move production to China. I do 
not fault China. The Chinese are doing only what we did to build this 
great United States of America.
  In the earliest days, we had just won our freedom, and the Brits 
corresponded with the fledgling Colonies and said: Now that you have 
won your freedom, why don't you trade with us what you produce best, 
and we will trade back with you what we produce best--the doctrine of 
comparative advantage these economists will tell you about.
  Alexander Hamilton had the wisdom, outlined in the Report on 
Manufactures. There is one copy left at the Library of Congress. That 
little booklet in a line told the Brits to bug off: We are not going to 
remain your colony. As a result, the second bill that ever passed 
Congress--the first being the

[[Page 17063]]

Seal of the United States--was a protectionist measure passed on July 
4, 1789, a tariff bill of 50 percent on 60 different articles. From 
there we began to build our own economic strength, our own industrial 
capacity, carried on by President Lincoln. When plans were being made 
to build the transcontinental railroad, some said buy the steel from 
London. Lincoln said: Oh, no, we are going to build our own steel 
plants, and then when we get through, we will not only have the 
railroad, we will have a steel capacity.
  Again, that crowd that comes around here whining about free trade, 
getting all the protection you can possibly imagine--the farmers--are 
solid for this. They are going to learn a lesson--be careful what you 
wish for. Maybe I will get on to that in a minute.
  It was Franklin Delano Roosevelt who instituted marketing quotas, 
protective import quotas, price supports--protectionism that built up. 
Yes, I am for the farmer and we are the greatest agriculture producer 
in the world. But do not tell me about free trade. There have not been 
any price supports for my textiles and my 38,700 textile workers who 
have lost their jobs since NAFTA. Incidentally, I remind people just 
exactly what happened. Yes, they are having to turn to service jobs if 
they can.
  I remember Onieta Industries in Andrews, SC. They made T-shirts. 
Everybody can understand it. They closed the plant in the early part of 
last year. There were approximately 480 employees with an average age 
of 47. Do it Washington's way; do it the way Congress lectures: 
Education, education--we have to reeducate. They sound like a bunch of 
Mao Tse-tungs. So we reeducate, and tomorrow we have 487 expert 
computer operators. Are you going to hire the 47-year-old or the 21-
year-old?
  Those 47-year-olds are out of a job. The average employer is not 
going to take on the pension costs and health costs for the 47-year-old 
when they have relatively none to consider for the 20-year-old. So they 
are sidelined. And that is the anxiety explored recently in Business 
Week: ``The Backlash Behind the Anxiety of Globalization.''
  President Clinton, himself--this is from the Los Angeles Times in May 
of this year. I quote:

       So Clinton asked rhetorically, why are we having this 
     debate on PNTR? Because people are anxiety ridden about the 
     forces of globalization.

  I just finished reading David Kennedy's ``Freedom from Fear,'' the 
legacy of Franklin Delano Roosevelt. The legacy of William Jefferson 
Clinton is fear and fear itself. Global anxiety. Why? Because that 47-
year-old who worked at a plant for 25 years was saving his money, 
making his home payments, his car payments and had a little boat down 
on the Black River--now he is high and dry. At best, he is trying to 
get a job at McDonald's or at the laundry or somewhere else in the 
service economy that doesn't pay.
  Talking about those jobs, I think we ought to really emphasize the 
fact that we are separating, if you please, the society. In Fortune 
magazine, dated September 4 there is the article entitled, ``Are the 
Rich Cleaning Up?'' It is by Cait Murphy:

       Blue-collar workers make less than they did a generation 
     ago while the earnings of professionals have soared.

  Mr. President, I ask unanimous consent to have this article printed 
in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                     [From Fortune, Sept. 4, 2000]

                       Are the Rich Cleaning Up?

                            (By Cait Murphy)

       The average price of a Manhattan apartment south of Harlem 
     has hit more than $850,000--at a time when two-fifths of New 
     York City's residents make $20,000 or less a year. In Silicon 
     Valley teachers struggle with the rent while dot-com-rich 
     parents wonder how to cope with ``affluenza''--the perils of 
     new and great wealth. (Hint: Just don't buy that helicopter.) 
     In leafy suburbs nurses and cops commute from 50 miles away: 
     They cannot afford to live near their work.
       This dichotomy--between new wealth and the not-so-wealthy--
     has lately become something of an academic and political 
     obsession. Economists and social scientists have turned the 
     study of income inequality into a thriving cottage industry. 
     And while the rich-poor gap has not cropped up explicitly in 
     the presidential campaign, it is the subtext for a number of 
     front-burner issues like tax cuts, educational reform, and 
     the ``digital divide.'' When a politician uses the word 
     ``fairness'' in an economic debate, that's often shorthand 
     for ``inequality.''
       Why the concern about inequality? Basically, because 
     there's more of it. From 1977 on, the cash earnings of the 
     poorest fifth of the U.S. population fell about 9%, estimates 
     the Center on Budget and Policy Priorities; middle-class 
     earnings rose 8%; and upper-income earnings, 43%. The exact 
     numbers are hotly contested, but it is clear that the 
     distance between the top and the bottom tiers of the income 
     distribution has grown strikingly since the 1970s. By some 
     measures, Americans' earnings are more unequal today than at 
     any time in the past 60 years; at best, even after the past 
     several years, when income has grown throughout the income 
     distribution, the gap has plateaued at or near record levels.
       Of course, no serious person would argue that everyone 
     should get the same-sized piece of the economic pie. That 
     would be unfair to those who work hard, as opposed to those 
     who watch reruns of Gilligan's Island all day. And if 
     spectators want to pay more to watch a baseball game than, 
     say, a badminton match, there is no reason both sets of 
     athletes must be paid alike. At the same time, no serious 
     person would deny that inequality can hit such levels (think 
     medieval societies) that it comprises both an ethical problem 
     and a threat to social peace (the peasants revolt). Finally, 
     there is little disagreement about whether inequality has 
     increased. It has. But there is also massive mud-wrestling 
     about how much it has grown, why, and what it all means.
       FORTUNE will spare you the arcane details--for now, anyway. 
     But the fundamental argument about inequality is simple. The 
     pessimists contend that income distribution has grown so 
     lopsided that all society is worse off. Richard Freeman of 
     Harvard speculates that there is a link between inequality 
     and crime. He notes that high school dropouts fill the 
     nation's jails--and that these men have lost the most ground 
     economically. Edward Wolff of New York University contends 
     that if young men had a better shot at earning a stable 
     living they might be more willing to marry and stop having 
     children on a freelance basis. Robert Greenstein of the 
     Center on Budget and Policy Priorities argues that earnings 
     disparities are one of the reasons that almost one in five 
     children lives in poverty. America's lowest-paid workers make 
     less, as a percentage of the median wage (the point at which 
     50% are above and 50% below), than their counterparts in any 
     other country (38%, compared with 46% in Britain and Japan 
     and more than 50% in France and Germany). This means that 
     many low-skilled parents just cannot earn enough to escape 
     poverty. ``If there were somewhat less inequality,'' 
     Greenstein concludes, ``more would have a better standard of 
     living.''
       There is also considerable (but contentious) literature 
     that more-equal societies are healthier. And there is the 
     inchoate but deeply felt belief that inequality at current 
     levels is simply un-American. It gives the rich too loud a 
     voice. It makes it too hard for those at the bottom to rise 
     to prosperity. And it allows the wealthy to separate 
     themselves from society through private clubs, private 
     schools, and gated communities.
       The optimists respond to that critique with a polite yawn. 
     Or perhaps a rude word along the lines of ``Rubbish!'' Sure, 
     inequality has grown, but so what? As long as people at the 
     bottom have not become absolutely worse off, goes this set of 
     arguments, it doesn't matter that the rich got richer faster. 
     And no, the poor are not worse off. Though men's earnings 
     seem to have fallen since 1973 (and maybe they haven't), 
     women's have clearly risen. That trend and smaller households 
     mean that family income and income per head have increased 
     all along the income distribution. Housing quality and access 
     to medical care have improved markedly for the poor since 
     1973.
       Besides, people don't necessarily stay in the same 
     position. They move up and down the income ladder: Horatio 
     Alger was not just making stuff up. Today's income 
     distribution is the result of long-standing economic forces 
     and social trends. Nothing is broke, so don't fix it.
       Those are the broad outlines of a debate in which the devil 
     is most definitely in the details. What follows is a primer 
     of the arguments, followed by a suggestion about how to get 
     out of this thicket.
       What are people so concerned about? Students of inequality 
     use several tools in their trade. One is the Gini 
     coefficient; a 0 coefficient is perfect equality (everyone 
     has exactly the same share of the economic pie). A 
     coefficient of 1 is perfect inequality (Bill Gates gets it 
     all). In America the coefficient has risen from 0.323 in 1974 
     to 0.375 in 1997, according to the Luxembourg Income Study, 
     higher than in any other rich country. Britain's is 0.346, 
     Germany's 0.300, Canada's 0.286, and Sweden's 0.222.
       Matters naturally are not quite that straightforward. Alan 
     Greenspan has pointed out that while the Gini coefficient is 
     comparatively high for income, when applied to

[[Page 17064]]

     consumption it is about 25% lower. In other words, poorer 
     people are spending more like the rich; they are, for 
     example, almost as likely to own such things as dryers and 
     microwave ovens. So the economic distance between the top and 
     the bottom may be narrower than the income numbers suggest. 
     And Europe's greater equality may simply reflect the widely 
     accepted premise that while America has adapted to economic 
     change by allowing inequality to rise, Europe has adjusted by 
     allowing higher unemployment. Which is better?
       Another favored analytical tool for measuring inequality is 
     to divide the population into fifths, or quintiles, and see 
     what share of the nation's earnings each fifth took home. 
     According to the Census Bureau, in 1998 the bottom 20% earned 
     only 3.6% of total income (4.2% in 1973), compared with more 
     than 49% for the top 20% (44% in 1973).
       But wait a minute. The Heritage Foundation points out that 
     the Census defines quintiles in terms of households--and 
     households in the bottom quintile are much smaller than those 
     at the top. Therefore, while there are 64 million people in 
     the richest quintile, there are fewer than 40 million in the 
     poorest one. Adjust for population, and the share of the 
     bottom fifth grows. Also, many Americans have income that is 
     not in the form of wages or cash transfers--food stamps and 
     housing subsidies for the poor, realized capital gains for 
     the better-off. Adjust for that, and the distribution narrows 
     again, as it does after accounting for taxes. Should the 
     adjustment include Medicaid and Medicare? If so (and that is 
     debatable), the gap shrinks further still; put it all 
     together, and Heritage figures that the bottom quintile takes 
     in 9.4% of national income, and the top 39.6%.
       There is, then, no consensus on how to measure inequality. 
     There is, however, broad agreement that it has indeed grown. 
     Since the early 1970s the cash incomes of the rich have 
     indeed risen faster than those of the poor, with the middle 
     class hanging in there; the higher up the income ladder, the 
     faster the growth. That may help explain why the poverty 
     rate, now 12.7%, has still not dipped to 1973 levels (11.1%). 
     Median household income (the point at which 50% are above and 
     50% below) has grown grudgingly, rising about 9% in real 
     terms from 1973 to 1998 and passing its 1989 peak only in 
     1998.
       Men have had a particularly dismal time. The median income 
     of men is significantly lower than in 1973 ($27,394 then vs. 
     $25,212 in 1997, in 1997 dollars). Men under 45 are making 
     less now, in real terms, than they did in 1967, and blue-
     collar workers have taken the biggest hit. Blacks and women, 
     however, have seen their earnings rise.
       Why is inequality increasing? Income inequality is 
     increasing because wage inequality is. The U.S. economy has 
     evolved to reward highly educated people even more than in 
     the past--a trend that social scientists, in a flight of 
     whimsy, call ``skill-biased technological change.'' This 
     means that demand for labor has shifted toward the skilled 
     and away from the unskilled. Brains beat brawn--hands down.
       That explains the rise in the college premium--the extra 
     income college graduates can expect to earn compared with 
     those who finish only high school. The premium rose much 
     faster in the U.S. than in Europe because the supply of 
     graduates in the U.S. did not rise as fast in the 1980s and 
     1990s as the demand for them; Europe came closer to matching 
     demand and supply. It sounds like a tautology, and perhaps it 
     is: Income shifted toward the more highly skilled because 
     employers would pay more for their services. But it really is 
     that simple.
       Of course, that by itself doesn't explain the income gap. 
     Another significant factor has been family structure. 
     Weighing on the downscale side of income distribution has 
     been the burgeoning number of single-parent families, 
     particularly those headed by never-married mothers; overall, 
     single-parent families earn about half as much as two-parent 
     households. On the upscale side, there has been an increase 
     in families in which both spouses make lots of money. To put 
     it another way, there are almost 2\1/2\ times as many people 
     working in the richest fifth of households as in the poorest 
     fifth. Less than a third of the people in the bottom quintile 
     live in households headed by a married couple; the rest are 
     single (55%) or in single-parent families. In the top 
     quintile some 90% live in married-couple families.
       Changes in family structure account for more than a third 
     of the increase in income inequality since 1979, figures Gary 
     Burtless of the Brookings Institution, making it a slightly 
     more important factor than the widening wage gap. Lynn Karoly 
     of the Rand Institute in California calculates that the wage 
     gap is a bigger deal, but no matter: No one disputes that 
     both factors are crucial.
       Other suspects in the inequality lineup are the declining 
     minimum wage (lower in real terms than in 1973), declining 
     unionization among men (accounting for as much as 20% of the 
     gap, estimates Freeman), deregulation (protected industries 
     kept wages high), immigration (which can depress wages), and 
     trade (that giant sucking sound). Higher levels of 
     entrepreneurship may also be associated with higher 
     inequality.
       All those things probably count, but to a minor degree 
     compared with the changes in earnings patterns and family 
     structure. Immigrants, for example, can drive down wages in 
     local labor markets, particularly among the low-skilled, but 
     that effect is muted across the country as a whole. When it 
     comes to trade, the effect is even more difficult to 
     identify. While some companies have certainly shipped jobs to 
     cheaper climes, most U.S. trade is with other rich countries, 
     and most low-paid jobs are domestic, such as cleaning or food 
     service. Remember, too, that to critique immigration and 
     trade strictly in terms of their impact on inequality is to 
     look through a cracked mirror: Doing so ignores the 
     contributions immigrants make to America and the 
     opportunities wrought by freer trade.
       What is more important than any of these individual 
     factors, Karoly notes, is how all of them have reinforced one 
     another. At the same time, there have been few countervailing 
     forces. The U.S. could have tried to slow these trends, as 
     Europe has done, through high minimum wages or centralized 
     wage bargaining or protective trade barriers or high taxes. 
     It chose not to.
       What can be done? The primary rule of economic policy 
     should be like that of medicine: First, do no harm. And the 
     problem with many of the knee-jerk policy responses to 
     inequality is that they cannot pass that test. Looking at the 
     list of culprits responsible for the run-up in inequality, 
     for instance, one could argue for less technological change, 
     less trade, more regulation, and less entrepreneurship. Would 
     America really be better off with such an economic blueprint? 
     To ask the question is to answer it.
       Even the more plausible approaches carry side effects worth 
     thinking about. Take unions. Unions are an essential part of 
     a free society, and they do an excellent job of raising wages 
     for members. But they can also be associated with not-so-good 
     things, such as protecting their workers at the expense of 
     those trying to get into the labor market--an important 
     factor in the high level of European unemployment. In July, 
     Alan Greenspan contended that it was America's greater labor-
     market flexibility that had allowed it to take advantage of 
     information technologies faster and more fully than Europe; 
     tech-led productivity has been the bedrock of America's 
     recent wage and productivity surge. In this context, the case 
     for actively encouraging more unionization begins to weaken.
       What about raising the minimum wage? That's plausible too, 
     and the increased minimum wage probably played a role in 
     steadying inequality in the past few years. Moreover, 
     countries like France, which has a high minimum wage, have 
     seen inequality grow much less. America may be robust enough 
     to swallow the proposed minimum-wage increase to $6.15. But 
     there is clearly a point where a minimum wage can become 
     burdensome, killing job opportunities, as has happened in 
     Europe. And raising the minimum wage is an awkward way to 
     lessen inequality. Most minimum-wage workers do not live in 
     low-income households (think of suburban teens), and many 
     poor households have no workers at all. So most of the gain 
     from a higher minimum wage goes to families that are not 
     poor. Worse, the Organization for Economic Cooperation and 
     Development has documented a connection between the minimum 
     wage and youth unemployment: the higher the wage, the more 
     idle youngsters. That has to be a large part of the reason a 
     quarter of France's under-25-year-olds are out of work.
       Is all this simply an argument for complacency? Not quite. 
     It is really an argument for looking at the issue from a 
     different perspective. Let's face it: Normal Americans do not 
     fret about rising Gini coefficients or quintile 
     displacements. They do however, worry if hard-working people, 
     even professionals, cannot find a home of their own that fits 
     their means. They don't want children suffering, even if 
     their parents made bad choices. They believe that opportunity 
     is available to all and that government should not hinder 
     people's ability to take care of themselves. Americans, in 
     short, are hapless at class warfare (perhaps because they are 
     so absorbed in racial and ethnic issues). If they were better 
     at it, they would be howling, say, at the proposed death of 
     the death tax, which applies to only a tiny share of estates. 
     Instead, most people want it killed. The attitude seems to 
     be, ``Hey, that might be my estate someday.''
       Given such attitudes, a plausible list of goals for 
     government might go something like this: Enhance the 
     prospects of poor children, improve living conditions, reward 
     work, bolster family responsibility, keep taxes from 
     impoverishing people and ensure mobility.
       And surprise, surprise: American social policy in the 1980s 
     and '90s has done almost precisely that. The Reagan 
     Administration can take credit for the 1986 tax reform, which 
     released many lower-income Americans from federal income-tax 
     liability. The earned-income-tax credit (EITC), also a 
     Reagan-era initiative, supplements the pay of low-wage 
     workers with children through a refundable tax credit of up 
     to 40% of earnings. The Bush and Clinton Administrations 
     expanded the EITC (the latter in the teeth of strong 
     Republican opposition). Both also expanded the provision of 
     support services for

[[Page 17065]]

     poor children outside the home--child care, foster care, Head 
     Start, and so on. Child-support enforcement expanded under 
     all three (with, it has to be said, spotty results), and 
     health insurance and child-care subsidies for poor children 
     expanded under Bush and Clinton. The welfare reform of 1996 
     (in the teeth of strong Democratic opposition) explicitly 
     connected working to the receipt of benefits. Overall, these 
     policies make up a broadly consistent approach that Americans 
     are in tune with--and that has delivered real improvements.
       Perhaps, then, the way to remedy inequality is not so much 
     to try to lessen the Gini coefficient--through redistributive 
     taxation, for example--but to ameliorate the problems of 
     those snagged at the bottom. One such problem is clearly 
     housing. There is a gap between the growing numbers of low-
     income renters (10.5 million in 1995) and the shrinking 
     numbers of low-cost rental units (6.1 million). A record 5.4 
     million households spend more than half of their income on 
     rent or live in substandard housing. The feds can and should 
     do more in this regard by boosting the number of housing 
     vouchers. (Congress eliminated new housing vouchers for four 
     years in the 1990s; the 2000 budget envisions expansion.)
       But inequality begins at home. It is not coincidental that 
     two cities with massive affordability problems--New York and 
     San Francisco--may also have the most tortured housing 
     markets in the country. Byzantine regulations suppress new 
     construction and raise its cost. Insiders--those who have 
     scored a price-controlled apartment--benefit at the expense 
     of outsiders, who pay prices exaggerated by the artificially 
     induced constraint in supply. So while rent decontrol rarely 
     makes the egalitarian to-do list, it deserves to be on it. 
     And Silicon Valley and other wealthy communities should take 
     a hard look at regulations--two-acre zoning and the like--
     that put up a keep out sign for the unrich.
       Expanding the EITC further--by increasing the credit 
     (particularly to families with three or more children) and 
     extending it to childless full-time workers--would also help. 
     The EITC is first-rate social policy. Essentially it promises 
     parents that if they work, their income will exceed the 
     poverty line. In 1998, EITC supplements lifted almost five 
     million people out of poverty, and that money has proved an 
     important carrot to get former welfare recipients into the 
     job market. A further expansion would put more dollars in low 
     earners' pockets and reduce the ranks of the working poor, 
     without the scattershot effect of the minimum wage. It also 
     makes perfect equity sense in the context of the tax cuts 
     both parties are fiddling with. Don't believe the fluff: Tax 
     cuts would benefit the better-off most, for the very good 
     reason that they pay the lion's share of taxes. The top 1% of 
     earners, for example, pays almost a fifth of all individual 
     federal income taxes, according to the Congressional Budget 
     Office, and the top fifth almost 60%. The bottom two 
     quintiles contribute 8%. An expanded EITC, in combination 
     with tax cuts, would spread tax largesse all the way up and 
     down the income distribution. Along the same lines, states 
     that are considering cutting taxes would do well to cut sales 
     taxes, which hit the poor hardest, rather than income taxes. 
     Or they could start or expand their own versions of the EITC, 
     as more than a dozen states have already done.
       Third, surely a country as rich and talented as America can 
     figure out some way to ensure reasonable, regular health care 
     at a level of access that, say, Ireland provided in the 
     1960s. There has been expansion of guaranteed medical 
     provision for poor children, but about 15% still slip between 
     the cracks. A system with fewer gaps could also promote 
     mobility; it is scary for low-income people in a job with 
     health coverage to try to improve their position by moving to 
     a new job without it.
       Fourth, let's remember that not every problem comes with a 
     ready solution, from government or anywhere else. For 
     example, it would be an unambiguously good thing for America 
     as a whole if families formed more readily and stayed 
     together more reliably. This would also narrow wage 
     inequality and boost family income. It's just far from 
     obvious how to get there from here.
       Social policy is not a field of dreams; miracles are rare. 
     Across the rich world, estimates Ignazio Visco of the OECD, 
     the long-term poor are some 2% to 4% of the population. But 
     at any given time, these families make up half of the 
     population living in poverty--everyone else moves up and out. 
     The major problem in such homes is not lack of money but 
     disorganization, illness, lack of social skills, and general 
     cluelessness. In her book What Money Can't Buy, Susan Mayer 
     of the University of Chicago argues that after basic needs 
     are met, additional income has little effect on children's 
     prospects. Using a form of regression analysis that only a 
     social scientist could love (or indeed understand), Mayer 
     estimates that doubling the income of the poor would reduce 
     high school dropout rates by one percentage point, increase 
     education by a few months, have no effect on teen pregnancy, 
     and possibly worsen male idleness. ``Any realistic 
     redistribution strategy,'' she concludes, ``is likely to have 
     a relatively small impact on the overall incidence of social 
     problems.'' Enhancing living standards to provide dignity and 
     reasonable comfort is a social good in itself. But humility 
     is warranted in terms of the long-range benefits of doing so.
       In the long run, because so much of inequality is connected 
     with the higher returns on skills, it is crucial that 
     Americans learn the things they need to know in order to 
     succeed. Which brings us to education, the most important 
     component of the mobility that is the bedrock of the American 
     dream. Poor people in poor communities are educationally 
     short-changed, and the problems begin early. That Americans 
     of almost any intellectual level can find a college to accept 
     them does not excuse the lack of basic skills too many high 
     school graduates demonstrate. Money may be part of the 
     answer, but only part. Cash can be spent wisely or stupidly; 
     there is, at best, an ambiguous correlation between spending 
     and achievement. But evidence indicates that increased 
     attention to education in early childhood brings enduring and 
     positive results. It's clear that there has to be more 
     emphasis on accountability and outcomes--what children 
     actually learn--as opposed to how much is being spent. That's 
     beginning to happen. And it's hard to believe that 
     competition--vouchers, charter schools, and the like--would 
     not be a goad to improvement.
       Finally, let's remember that nothing good is going to 
     happen if the economy goes into the tank. Tight labor markets 
     have done more to make welfare reform work than any aspect of 
     its design; productivity has driven up wages since 1993 
     faster than any transfer program could have done. Remedies to 
     inequality that hurt the economy as a whole will hurt the 
     poor first and worst.
       Laura D'Andrea Tyson, former head of the Council of 
     Economic Advisors under President Clinton, offered a striking 
     way of looking at these issues at a Federal Reserve 
     conference in 1998. Imagine the income distribution, she 
     suggested, as an apartment building in which the penthouse is 
     more and more luxurious, and the basement, in which a number 
     of dwellers (and their children) are stuck year after year, 
     is rat infested. What to do? Well, some social critics, 
     offended by the presence of wealth amid such distress, would 
     like to pillage the penthouse. Tyson simply notes, ``We need 
     to do something about that rat-infested basement.'' Taking 
     care of the rats and making sure people can climb out of the 
     cellar: That seems about right.

  Mr. HOLLINGS. You begin to understand--when we talk about jobs, when 
we talk about pay, when we talk about our society, when we talk about 
our economic strength, when we talk about the middle class--that the 
strength of our democracy is disappearing.
  So, yes, we are going to trade with China. But if you make it 
permanent and you make it normal and you want to compete with China, 
you are going to be in one heck of a fix, is all I have to say.
  Let me say a word about market share. Japan has been practicing this 
for a long time. They have a society that sacrifices at the home market 
in order to take on the international market, the market of the United 
States. There is no question about it.
  That Lexus that costs $34,000 in the United States costs $40,000 to 
$44,000 in downtown Tokyo. That camera that sells for $300 here--a 
Japanese camera--sells for $600 to $1,000 in downtown Tokyo. That 
Handycam that sells for $640 in the United States--made in Japan--sells 
for almost $2,000 in downtown Tokyo.
  We do not have that kind of society. This is a spoiled society. We 
are supposed to give you tax cuts even though we have hardly any taxes 
to cut. And they can't be punitive, because look at the economy. By the 
way, we are paying down the debt, but we do not tell them we are 
increasing the debt at the same time.
  I really have not had but one person ask me about the estate tax. 
Nobody has asked me about the Social Security tax because we put it in 
line with all other pension plans. Nobody has bothered about gasoline. 
Overseas, they regularly sacrifice $4.20 for a gallon of gas. When we 
get to $2 a gallon, we go ape and hold Federal investigations, TV 
shows, and everything else.
  So the competition in globalization is one of sacrifice. In China, 
they call it communism; sacrifice, in Japan, in Korea, and even in 
France and Germany. They have all kinds of rules and regulations. Try 
to buy a year 2000 Toyota in France. They keep it at the Port of Le 
Havre and inspect it a year or so, and you can buy the year 2000 model 
on January 1, 2001.
  They have all kinds of barriers and different tricks. We talk about 
globalization and productivity as if we

[[Page 17066]]

know something about it and that all we have to do is reeducate and get 
more engineering graduates. Come on.
  I am talking about middle America, the blood and guts of this 
society, the blood and guts of this democracy. That is what keeps us a 
strong country. That Fortune magazine article that came out the day 
before yesterday will tell you about that divide, will tell you that 
the take-home pay of that industrial worker is less than what it was 20 
years ago, adjusted for inflation. It is a devil of a trend, but they 
are not talking about that or even mentioning trade. But when it comes 
to market share, the Japanese set the pace.
  What is going on in telecommunications?
  I have a bill which is a reminder because the law is there. I am 
going to testify tomorrow that it is nothing more than a reminder. No 
communications bill is going to pass unless they put it as a rider on 
one of these appropriations bills. Because they do not want to debate 
these things.
  All you have to do is look at Deutsche Telekom's SEC reports and know 
they call themselves a monopoly and that the German government is in 
control.
  When you are a country in control, you can print money. We know that 
better than anybody. We have been running deficits since 1968, 1969 
under Lyndon Johnson; now the debt is $5.7 trillion. So we know about 
governments printing money.
  Deutsche Telekom had its stock at $100 earlier this year, in March. 
Now it is down to $40. Do you think Ron Sommer, the CEO of Deutsche 
Telekom, is worried? He could care less. He says: I have $100 billion.
  He just had a bond issue of $14 billion. Everybody got into it. We 
could not get a $14 billion bond issue going in this country. But a 
government-controlled company can easily get it because that company 
can't go broke. It is bound to win.
  Sommer says: I have $100 billion. And I am ready to buy AT&T or MCI 
or Sprint or VoiceStream or any telecom company I please. If his stock 
was down in the regular market to $40, and he had $100 billion, there 
would be a footrace between Boone Pickens and Carl Icahn. They would be 
in there in a flash. There would have been a takeover long ago. You 
see, they can come in with all kinds of capital and distort the 
competitive market.
  That is why we deregulated telecommunications from U.S. Government 
control in 1996. We certainly did not do it to put it under German 
Government control. That is why we have the World Trade Organization, 
in order to get competition, not to set up government-controlled 
companies to take over in the private market.
  But why do they do that? Who does offer the highest price, they tell 
me, per subscriber in one of these communications entities. Previously 
the highest bid was $12,000 per subscriber. Deutsche Telekom comes in 
with $21,000 to $22,000. Money is nothing to them. Why? Because they 
want market share. They battle. And the whole fight in globalization is 
for either jobs on the one hand, market share on the other hand, or 
both.
  That is the globalization. That is the trade. And we do not have a 
trade policy.
  They talk about free trade, and they get together. Unfortunately, our 
Democratic leadership gets together with the Republican leadership on 
this score.
  They put out the white tent and they fixed the vote. The New York 
Times wrote the article about it. The New York Times put in there that 
they got the NAFTA vote by giving our friend, Jake Pickle, a culture 
center; another Congressman two C-17s; another one a golf match. They 
had 26 gimmies to fix the vote. So they fixed the vote here in the 
Finance Committee and fixed the vote with the leadership, and they have 
the unmitigated gall to come and say: No amendments, don't discuss it, 
when can we vote, let's get this thing over with, free trade, free 
trade, free trade.
  I am going to join my friend, our leader from West Virginia, Senator 
Byrd, and others, and hope we bring some sobriety to this crowd up here 
in Washington. Let's start competing and let's start being productive. 
Congress berates the U.S. industrial worker. You must become 
productive. But we can't pass an increase in the minimum wage. We can't 
pass a patients' bill of rights. We can't pass gun control. We can't 
pass campaign finance. We can't do anything.
  Remember, we are competing with ourselves. I think that is one of the 
main points to be understood. I will never forget those industrialists 
who traveled all the way to Europe and back with jet lag to implement 
the Marshall Plan. Now with the profit the corporations make, they 
don't mind the jet lag. They don't mind moving for a while to Japan and 
Korea and other places. And as of 1973, the banks--Citicorp and Chase 
Manhattan--made a majority of their revenues and profits outside of the 
United States. They became more or less multinational. Then, of course, 
the corporations themselves started traveling over there and they 
organized in order to support this so-called free trade, which they 
knew historically was a bummer. They organized the Trilateral 
Commission and the Foreign Policy Association. If you run for 
President, the first thing you do is get a gilded invitation to go up 
and pledge on the altar of almighty free trade your loyalty and your 
fealty to free trade. So you become sophisticated. You become 
knowledgeable. Yet you don't know what you are talking about.
  Then they give the contributions to the college campuses so that you 
not only have the companies and the banks, but you have the campuses. 
There was a Ms. Jacobson who put out a study back in the 1980s where 
the majority of the contributions, I think, on the Harvard campus were 
Japanese. So you get all the campuses. You get the consultants. You get 
the Washington lawyers. We don't hear too much from our friend Pat 
Choate. I wish he would run again. Pat Choate wrote ``The Agents of 
Influence.''
  The agents of affluence were our special Trade Representatives, 
whether it was Eberly or Brock or Strauss, those representing us 
immediately went to represent the other side. It would be like General 
Powell going to represent Saddam Hussein and Iraq. But that is what has 
been going on. To Mickey Kantor's credit, he has not done that. But I 
have been here long enough to watch all of them. Carla Hills, who gets 
all of these awards and everything else, represented the other side, 
the competition.
  Then you have the retailers. We used to debate a bill, Mr. President. 
I would go down to Bloomingdale's, and I would get a lady's blouse made 
in Taiwan and one made in New Jersey because they are trying to fill up 
the order. They were never the same price, and the American 
manufacturer wasn't the lower price. I went to Herman's and got a 
catcher's mitt, one made in Michigan, one made in Korea--the same 
thing, the one from Korea was cheaper. So they make a bigger profit, 
the retailers. And the retailers pay the newspapers through 
advertisements. That is the source of the majority of newspapers' 
profits. The business manager of that newspaper says you have to be for 
free trade because the retailers are their clientele.
  I just heard the distinguished Senator from Arkansas talk about free 
trade. She was very much for this particular bill. Their biggest 
industry? Wal-Mart, import industry. They are going to sell a few 
chickens in Arkansas. Tyson hopes he can sell a few chickens. But they 
are not producing anything else there. So we have to go over to the 
retailers.
  We have the banks, the corporations, the consultants, the societies, 
the campuses, the lawyers, special trade representatives and, yes, the 
lawyers. The Commerce Committee does not consider a bill that your 
office does not fill up with this crowd. In fact, these folks are 
confusing the Deutsche Telekom bill that my distinguished colleague 
cosponsored with me, running around the whole month of August trying to 
figure out how to get this vote and how to get that vote.
  Section 310(a) says you cannot license a foreign government in 
telecommunications. It has been that way since 1934. We argued and 
debated it in

[[Page 17067]]

the 1996 bill. We ultimately left it alone. In spite of the White House 
and the FCC and all the other legal shenanigans they have ongoing, the 
law is still there, but they are trying to confuse that.
  It is like Spain with the fifth column. We have the enemy within, 
like Bobby Kennedy wrote about. I mean, I am not worried about China. I 
would run it the same way they are running it. They have a $68 to $70 
billion plus balance of trade. We have got $70 billion minus balance of 
trade and it has been growing each year. It is going to continue to 
grow.
  This is not about jobs in the United States. It is about jobs in 
China. The Wall Street Journal had a big headline that said investors 
are racing now to invest in downtown Beijing, get a foothold there and 
then get the protection of the WTO--because you know who the WTO is 
going to rule in favor of. Fidel Castro can cancel your vote, Senator, 
my vote, the U.S. vote. I mean, come on, the WTO setting our trade 
policy?
  I have introduced a bill in each of the last sessions of Congress and 
I will introduce it again next year. I am trying to get the 28 
Departments and the Agencies coordinated in a department of trade and 
commerce so that we can have a coordinated assault on the needs of this 
Nation. At the present time, it is all spread around, disparate. You 
have the policy from the Trade Representative. No, it is the Commerce 
Secretary. No, it is the Secretary of Defense. No, it is the White 
House. No, it is some other ruling that the administrative body, the 
FCC, has made. That is why we have these booming 60,000 lawyers at the 
bar in the District of Columbia--not 6, 60,000. I believe 59,000 of 
them are communications lawyers.
  If we could just coordinate and get one trade policy for this country 
and get competitive like the old Yankee trader; otherwise, we are 
losing our jobs, our manufacturing. We are in economic decline. We are 
losing our middle class. Unfortunately, we are losing the strength of 
our democracy. I really believe that.
  My friend, the Senator from New York, says this is a most important 
vote. Well, I think it is just as important for the exact opposite 
reason, that we kill it, not pass it, kill this thing, have regular 
trade, not normal, because we have been losing. I want to start 
competing. I certainly don't want a permanent trade agreement. Don't 
have one Congress try to bind the other Congresses. ``Permanent'' was 
put in there by the NAM Business Roundtable and the downtown lawyers. 
They are trying to get predictability to that investment over there, 
and they want to come back and tell ensuing Congresses: Look, you told 
us it was permanent and so we have our money over there.
  And so just like the Senator from Arkansas protects Wal-Mart, which 
he should, maybe I would be here trying to protect a textile company 
that wants to produce in downtown Beijing.
  The PRESIDING OFFICER (Mr. Gregg). The time under cloture has 
expired.
  Mr. HOLLINGS. I thank the Chair and yield the floor.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The senior assistant bill clerk proceeded to call the roll.
  Mr. CRAIG. 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. CRAIG. Mr. President, I come to the floor of the Senate this 
afternoon to discuss a motion to proceed on what many of us believe to 
be a very important issue, and that is Permanent Normal Trade Relations 
(PNTR) for China.
  While this issue has been a long time in coming to the floor of the 
Senate, its time has come. Our Nation, for a good number of years, has 
pursued a relationship with mainland China to improve the trade and 
commerce flows that are critical to this country. The agreement that we 
are here to ultimately get to final debate and passage on, is an 
agreement that allows an unprecedented access to the China market.
  I support PNTR for China because it will seal the deal on the U.S.-
China Bilateral Agreement and finally allow U.S. business and farmers 
the access to Chinese markets that the Chinese have to our market. In 
other words, America has had a relatively open market to China while 
China's market has been, for all intents and purposes, closed--except 
by category and by definition. Passage of PNTR will help pave the way 
for China's eventual membership in the World Trade Organization.
  I think, as you would probably agree, all of these are critical in 
our relationship to this very large country and the role that it will 
inevitably play in our future world. This deal cuts the barriers to 
trade that U.S. farmers and businesses have unfairly encountered for 
decades. It serves Idaho because it slashes tariffs on exports critical 
to Idaho's economy.
  Let me give a couple of examples. On U.S. priority industry products, 
tariffs will fall to 7.1 percent. Tariffs will fall on several products 
that are critical to my State, including wood and paper, which are 
critical to my State; chemicals, a growing industry in my State; and 
capital and medical equipment. In information technology--now a very 
important part of Idaho's economy--the tariff on products, such as 
computers, semiconductors, and all Internet-related equipment will fall 
from an average of 13 percent to zero by the year 2005.
  On U.S. priority agricultural products, tariffs will be reduced from 
an average of 35.1 percent to 14 percent by January of 2004, at the 
latest. It will also expand market access for U.S. corn, cotton, wheat, 
rice, barley, soybeans, meat, and other products.
  I think we all know the current state of the agricultural economy, 
and while we will set policy, to hopefully help production agriculture, 
we have always known that knocking down trade barriers and expanding 
the world marketplace for our producers in agricultural products 
remains critical. We have long since passed the day when we are the 
consumers of all that we produce. Now, well over 50 percent of 
everything a farmer or rancher produces on his or her property has to 
be sold in world markets to maintain current economies and to improve 
the profitability of those individual operations.
  China, without question, is struggling today to determine what it 
will do in agriculture. Without question, it will want to feed itself 
and to continue to do so. Any nation worth its own gravity wants to 
provide food and fiber for its own citizens. But as that economy 
improves--and it is improving--the ability of disposable income in the 
hands of the mainland Chinese means that they will want to buy more of 
a variety of products that our tremendous agricultural economy 
produces. This is merely a step, and that is why I say dropping tariffs 
from 31.5 percent to 14.5 percent by the year 2004 is significant. As 
we work with them, those tariffs could actually drop more rapidly in 
that area with additional agreements. There is no question that future 
Administrations in this country will continue to pressure the Chinese 
to move in the direction of even lower tariffs, but that significant 
drop of over 15 percent will rapidly enhance agricultural opportunities 
for sales to China.
  The United States needs this deal. We are the strongest economy in 
the world and, as a Senator, would I stand here and say we need this 
deal? Yes, because we do. The U.S. trade deficit with China is large 
and continuing to widen. The deficit surged from $6.2 billion in 1989 
to nearly $57 billion in 1998. And it continues to rise.
  That statement alone is proof that our economy has been a largely 
open economy and theirs has been a relatively closed economy. This 
agreement, however, rapidly moves them toward a much more open economy 
and, therefore, spells in very simple language an opportunity for 
American business and industry and America's working men and women to 
expand the products they produce to sell into the Chinese markets.
  In addition to reducing barriers to trade, it will also force China 
to play by the rules.

[[Page 17068]]

  There is, I guess, a bit of a saying that when you deal with the 
Chinese on the mainland, you sign the contract, and then you begin to 
negotiate. In this country, when you sign the contract, you have made 
the agreement. The negotiation is complete. That is why bringing them 
on line with PNTR and into WTO means that not only will they have to 
ultimately play by the rules, but there will be a learning process for 
them as well. In working with the dispute mechanisms of the WTO they 
will obviously learn that as they move more aggressively into world 
markets, there is a rule of law that we have all trading nations of the 
world play by; that is, a rule of fair trade based on the standards 
established and negotiated within the agreements.
  Let me give you an example of the problems we face today.
  Idaho is known for its beautiful orchards. Of course, the State of 
Washington--our neighbor--is known for more orchards and that fine red 
apple that many of us see on the shelves of the produce markets and 
supermarkets of our country. Today, many of those orchards that produce 
those marvelous apples in Idaho and Washington are being pulled out and 
replaced by other crops. Why? Because the Chinese have flooded the 
United States market with concentrated apple juice--that when you buy 
apple juice in the marketplace, the apple juice could well be produced 
from a Chinese concentrate shipped into our markets, then processed and 
bottled and sold into the American market.
  The only way we can control the Chinese flow of concentrated apple 
juice into our market today would be to either openly threaten or close 
down our markets--close down our borders to the Chinese. That makes 
very little sense when you are working to expand markets because they 
then would counter by closing down access to another portion of their 
markets only to hurt another segment of our agriculture.
  If they were in the WTO--if we accept this agreement--then they come 
under entirely new standards so that they have to regulate the flow of 
their concentrated apple juice into our markets, and without question, 
substantially improve the overall economy of the fresh fruit industry 
of this Nation and of the State of Idaho, and the State of Washington.
  PNTR also means better opportunity for Idaho business-people and for 
the Idaho workforce.
  For several years now Idaho has exported to China on a growing basis. 
We are 1.2 million strong in the State of Idaho. We are not a large 
State--at least population-wise.
  In 1993, my State exported just about $2 million worth of goods and 
services to China. But by just 2 years ago, in 1998, that number had 
grown to $25 million. That is a 1,000-percent increase in the flow of 
goods and services leaving Idaho and going to mainland China, which 
just shows you the tremendous expansiveness in the marketplace that 
still remains relatively closed. This agreement rapidly opens that 
market and allows us greater access.
  This last year, in December of 1999, I had the opportunity to lead an 
Idaho trade mission to China. I asked 13 different businesses and 
industries to go along with me and my wife, Suzanne, and some of our 
staff. Representatives from agricultural companies and building 
material companies and the high-tech community went along with us. We 
were all united, not only in our recognition of the importance of 
China's entry into the WTO, but all of these companies that went along 
went to look for opportunities to expand the marketplace of products 
built in Idaho for expanding the economy of my State and expanding the 
workforce and the job opportunities that exist in my State.
  While we were there, we had the distinct privilege of meeting with 
President Jiang Zemin. President Jiang gave us the courtesy of nearly 
an hour of his time in a direct discussion with myself and the trade 
delegation. During that time, he talked about China's future and he 
expressed it this way. He said China is serious about a transition to a 
more market-based economy, although the President made it very clear 
that China was not going to fall for the Russian model. In other words, 
they weren't going to throw out the old and assume that the new would 
just naturally take its place.
  What they recognized and what they are doing at this moment is a 
progressive step-by-step approach for greater access in the 
marketplace, greater flexibility in the marketplace, without collapsing 
their economy, and without destroying the job base they currently have. 
There is no question that China is eager to gain the economic benefit 
and the political prestige of a WTO membership.
  During that tour, we also went to an area and a province to the 
coastal city of Xiamen. There you can see firsthand what happens when 
an economy that was once guarded, protected, and limited by state-owned 
companies and by political control is turned, relatively, loose to join 
the world economy. Xiamen is one of six free-trade zones in China that 
was created by Premier Deng Xiaoping a good number of years ago. Their 
gross domestic product is phenomenal with average GDP of 20 percent, 
and job creation of the kind that is tremendously significant in giving 
the workforce of China the kind of upward mobility that all of us seek 
for all peoples of the world.
  While we were there, we toured a brand new Kodak plant that was built 
on about 19 acres of ground. It was once a rice paddy for water buffalo 
and cobra snake. In just 19 months, this rice paddy was transformed 
into a very modern company that met all of the building codes, 
standards, and safety requirements as if they were built in my 
backyard, or in your backyard, or anywhere in this Nation. It was the 
home of thousands of workers, working for a much higher wage given the 
kind of power that a higher wage gives, and even given the opportunity 
to buy and own their own apartment.
  If we really want to see China change, we must help give their 
workforce this kind of an economy, give them more money in their 
pockets, a chance to own private property, and then we will watch, over 
the years, a political change that will take place.
  PNTR for China will improve the standard of living for many Chinese 
who have endured very poor standards of living.
  PNTR isn't just a good deal for the farmers of Idaho, or the business 
men and women of Idaho. It is a good deal for the Chinese people who 
have suffered poverty beyond compare, and who are now beginning to 
experience through the marketplace, the opportunity of upward mobility, 
and the opportunity of private property ownership that truly begins to 
transform the political base and the landscape of a country.
  Over the last year, as this issue developed and certainly over the 
last 6 months as we have known and as the Nation has known that we 
would ultimately debate the issue of permanent trade status for China 
and debate their entry into the WTO, I have received a multitude of 
letters from Idaho from all kinds of constituents who for one reason or 
another see the issue of permanent trade status the same way I do. 
While we agree that some of the human rights issues in China, and some 
of the other kind of concerns that we have are important, we also agree 
that our Nation must be continually engaged with the Chinese to change 
the world and to change their role in the world. Building a wall or 
turning our backs on this huge population base is no way to gain those 
kinds of ultimate changes or benefits.
  These letters, and letters from my Governor, Dirk Kempthorne, I think 
note, at least for the moment, that I share them with you. Let me give 
you a couple of examples.
  Here is one from David Sparrow, of Boise, ID.
  He writes:

       Dear Senator: As a constituent and a member of the 
     agricultural community, I continue to urge your strong 
     support of PNTR legislation with China.

  He goes on to say:

       PNTR for China is vital to the farmers and other 
     agricultural interests in our district. Your vote is 
     critical.

  Another one is just a simple one-liner from a gentleman in America 
Falls, when he said:


[[Page 17069]]

       Support trade with China. Nothing to lose except a market 
     to other countries.

  That is exactly right. If we don't compete effectively, then our 
producers and our American workforce will be the loser as other 
economies of the world continue to increasingly engage the Chinese 
marketplace in their bid for consumer products and a role in the world 
markets.
  Doug Garrity from Blackfoot, ID, wrote this Senator:

       Dear Senator: As your constituent, I urge you to vote in 
     favor of Permanent Normal Trade Relations with China. 
     Congress must approve PNTR this year in order to secure 
     unprecedented access to world markets for my company and 
     others across America.

  He was talking about a company in American Falls, ID, that is an 
agriculture-based company.
  When the Idaho trade delegation and I met with President Jiang Zemin 
it was very clear from what he was saying that they believed this time, 
it was their turn to make the concessions. He openly talked about why 
they had made these concessions, why they were lowering their trade 
barriers, why they would phase them in over a period of time, and 
openly discussed even freer markets than the kind that are proposed in 
the current agreement Ambassador Charlene Barshefsky negotiated in late 
October and early November. President Jiang Zemin recognizes that the 
strength of his country in the future is not going to be based on the 
strength of a government but the strength of an economy and the right 
of his people to share in that economy, both individually and 
collectively as a country. He spoke very openly about that.
  It was an amazing experience to visit for well over an hour with a 
man who had walked behind Mao in the great revolution. He did not 
mention that once, but instead talked in terms of open and free markets 
and talked about China's role in a world economy and our role and our 
companies' roles and our national economy's influence over them and 
their economy. It was a dialog I would not expect to have. Yet it is a 
dialog that is now pursued nearly every day of the week in China by 
U.S. companies who are openly and actively gaining a piece of that 
market.
  Another letter from Marlene Sanderlin of Lewiston, ID, which is a 
forest products and agricultural town. It is the location of our 
seaport where ocean-going barges come all the way up the Columbia and 
Snake Rivers into the heart of Idaho to take out Montana and Idaho 
grain, forest products, paper, and coal from Montana. All of that is 
moving out to the Pacific rim and some of it ultimately going to China. 
The vitality of that seaport, in the heart of Idaho, is in large part 
connected to the vitality of our trade in the Pacific rim and China. 
And China's economic growth, without question, is an opportunity for 
that seaport and for every seaport in the United States and the men and 
women who work in the maritime industries.

       As your constituent, I urge you to support PNTR legislation 
     for China. This legislation benefits real people: Me, my 
     family, and my country. It guarantees economic growth for 
     America and promotes the growth of democracy in China.

  She speaks from my experience and my limited exposure in China, and 
the absolute truth when she says it addresses the growth of the 
democracy or the democratic actions within China itself.
  Potlatch Corporation happens to be a company that is a large paper 
and fiber producer in Lewiston, ID. They write, asking that we support 
this. Why? Because of the thousands of workers they have at Potlatch 
and the products they can supply into the Pacific rim and into the 
Chinese market.
  I have a good many letters from Idaho. We have received thousands. I 
know that nearly every Senator has received phenomenal communiques from 
their State in support of this particular issue that is now before the 
Senate itself. Establishing a permanent trade relationship with China 
means establishing a permanent, but also growing and developing 
relationship with the most populated country in the world. Without 
question, it is a vast opportunity for the sale of our products, and 
for an ongoing and working relationship with those Chinese people that 
can do nothing but help improve the ongoing relationship.
  We will have some important tests in the coming days as other votes 
on other issues directly related to China come up. I will take a 
serious look at some of them because we need to make very clear, 
straightforward statements to our friends in China as to what we can 
and will expect and what we don't expect as it relates to their role in 
the world community and our role along with theirs.
  If PNTR were voted down, the real losers would be the American 
business person, the American farmer, and the American workforce. We 
have a vibrant economy today, and our economy is vibrant because we can 
sell in an ever-opening world market. It has not cost us jobs, it has 
continually improved and built a stronger economic base and a greater 
job opportunity for nearly every citizen in our country who seeks it. 
While that economy is strong, in the agricultural communities of Idaho 
and across the Nation, it is weak. It is weak because nearly 20 percent 
of the world market is off limits or in some way restricted to direct 
access for our production agriculture.
  This is a quantum leap forward to not only gaining greater access but 
improving the economy of hometown, smalltown America. Idaho, my State, 
has a good many of them. PNTR is a critical link in providing that 
business economy, jobs, and growth relationship with China and China's 
future. Rejecting permanent normal trade relations would, in my 
opinion, have a dramatic impact on the economy for all the opposite 
reasons I have expressed that passage would have a positive impact.
  Lastly, if we reject this, we largely freeze our relations with 
China. We can't afford to do that as a country. We can't afford to do 
that as a world leader. I, along with a lot of my colleagues, have been 
very stressed in the last several months with some of the utterances 
coming from China and some of what appear to be their activities here. 
Shame on us if we ignore this and if we ignore all of those other 
utterances. Full engagement is the only way we can deal with the 
Chinese. Full engagement economically, full engagement in trade, 
dealing with defense matters, openly stating our positions in 
unequivocal ways as to how we will deal with our friends, neighbors, 
and potential adversaries around the world.
  It is that kind of leadership that is incumbent upon this country, it 
is that kind of leadership that is asked for in the Senate now in the 
passage of a permanent normalizing trade relationship with mainland 
China. I hope as we move to this vote we can get there, pass it, pass 
it as cleanly as possible, and get it to the President for his 
signature.
  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. BYRD. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Craig). Without objection, it is so 
ordered.
  Mr. BYRD. Mr. President, the Senate is presently considering the 
extension of permanent normal trade relations status, or PNTR, to the 
People's Republic of China contingent upon China's accession to the 
World Trade Organization, WTO. Earlier this year, it appeared that 
China might seek to join the WTO this fall, but now, in the first blush 
of autumn, that possibility has receded. And so has the urgency for us 
to consider granting PNTR on a permanent basis or on a temporary basis 
to China. Yet, here we are, with but a scant handful of days left in 
this Congress and a large number of must-pass appropriations bills 
awaiting our attention, discussing the merits or demerits or lack of 
merits of forevermore foregoing our annual ritual of reviewing and 
extending normal trade relations to China.
  It might be worthwhile for the Senate to so consume its time, if we 
were taking this debate seriously. After all, it is quite a significant 
vote, the outcome of which may have long-lasting

[[Page 17070]]

effects on our economy, on American jobs and on American workers. 
Proponents of extending PNTR to China note with some alarm that, should 
China join the WTO, the United States could be subject to sanctions by 
China because we do not currently treat it exactly the same as we do 
other trading partners, both in the WTO and outside the WTO. And that 
is true. We do not treat China the same as, say, the United Kingdom or 
Japan. We put conditions on our trade with China, human rights 
conditions and labor conditions and nonproliferation conditions. We do 
so out of concern for those issues with respect to China.
  Our annual debate and vote to extend for another year normal trade 
relations, with conditions or without conditions, allows us, here in 
Congress, to comprehensively review our relationship with China. The 
annual vote on NTR is important to China, more important, perhaps, than 
any other single piece of legislation might be. The United States is a 
huge market, an attractive market, and an important market for Chinese 
goods. The competitive advantage of NTR tariff rates is consequential. 
It is both a carrot and a stick to persuade China to alter its behavior 
with regard to issues near and dear to Americans, such as religious 
freedom, such as nonproliferation.
  I would be happy to spend many hours on this debate, and discussing 
this important trade and security relationship. I consider it an 
important debate. But I am somewhat dismayed to read news accounts 
about a cabal among Senators to stifle one of the most important rights 
granted by the Constitution to the Senate. That is the right to offer 
and have debate on and votes on amendments. In the House, the rule 
guides debate and the number and content of amendments that might be 
offered to a bill. That is perhaps necessary in a body with 435 
Members. But the Constitution says: Each House may determine its own 
rules. The framers made the Senate a place where minority views, and 
small States, had an equal voice.
  Thus, West Virginia, a State consisting of 24,000 square miles--as a 
matter of fact, 24,231.4 square miles--is not a very large State when 
placed beside, on a geographic map, the great State of New York, which 
is so ably represented and which has been so ably represented by the 
senior Senator from New York, Mr. Moynihan.
  I oppose this legislation with due apologies to my friend. And he is 
my friend--a man of great wit, of great stature, a man of natural 
grace, a student, a scholar, a teacher--Pat Moynihan. I apologize to 
him for having to vote against this bill, but I shall do it with gusto.
  The framers established the Senate as a forum for unlimited debate 
and unlimited amendment. Or did they? They certainly did so with 
respect to unlimited amendments. But for several years, there was the 
previous question here in the Senate by which debate could be limited. 
But when Aaron Burr completed his tenure as Vice President of the 
United States and made his farewell address to the Senate, in early 
March of 1805, he recommended that the previous question be dropped 
from the rules. It had only been used 10 times in the previous years 
from the inception of the Republic. When the rules were revised in 
1806, the previous question was dropped. It was then that unlimited 
debate reigned pure and undefiled and unchallenged in the Senate of the 
United States. So this is a precious birthright.
  By the way, there were no limitations placed upon debate from that 
time--1806 or 1805--until 1917, when the present rule XXII--not exactly 
the present rule; it has been changed some since then--but a rule 
providing for the invoking of cloture was adopted in the Senate in 
1917.
  But this group of Members--I do not know who they are, and I am not 
sure that such a group exists, but I will take rumor for truth at this 
point because it very well could occur to some Members to want a 
``clean'' vote, up or down.
  This group of Members, I read, want a ``clean'' vote, up or down, on 
the House-passed bill. They, and a number of House Members, do not want 
a conference. And they do not want a second vote in both Houses on a 
conference report. So these Senators--well-intentioned, well-meaning--
are determined to defeat every amendment, I hear, to this bill, 
regardless of merit. So having heard it, let me accept it as the truth 
and proceed accordingly. I am embarrassed to read that. I hope that it 
is not true, that Members of this body would relinquish a critical 
Senate prerogative, especially over so important an issue. Perhaps they 
would say: Well, it isn't exactly relinquishing a prerogative. Other 
Senators may call up amendments, but we will vote them down. They shall 
not pass.
  If it is true, then we are just spinning our wheels here, are we not, 
by trying to fulfill our Constitutional role of regulating foreign 
commerce? We are just spinning deep ruts in the Senate floor by 
attempting to offer amendments to improve this bill before we close off 
our opportunity to annually review and affect our relationship with 
China.
  I have reviewed the House bill, somewhat cursorily, I admit. It is 
not that the House-passed bill is a bad bill. It contains a number of 
reporting requirements that attempt to assuage concerns about human 
rights and labor rights in China. But without the goal of an annual 
renewal of NTR status behind it, what force does a report have to 
affect behavior in China? How can a report protect American workers 
whose jobs are in jeopardy because of unfair actions in the trade field 
by China? How can a report protect American missionaries in China or 
Chinese citizens who wish to practice their religious beliefs? How does 
a report turn back a shipment of missile technology? How does a report 
turn back threatening words and actions directed at another nation like 
Taiwan?
  The goal of this administration, and of the past few 
administrations--and I say this most advisedly; I have been in Congress 
now 48 years--and every administration since I came to Washington, 
Democratic and Republican, has been the same way, always singing the 
same old tune, and is guided, it seems to me, by the State Department.
  The goal of all of these administrations, including the present one, 
has been to, bit by bit, eat away at the constitutional powers of this 
body to regulate foreign commerce. This is the message behind limiting 
mechanisms such as fast track. The argument is that our trading 
partners do not like agreements to be amended so it is take it or leave 
it for the Senate. But the Senate must make judgments based on our 
national interest.
  Trade is a matter of increasing national interest. No one would dream 
of making the argument that we cannot vote for reservations or changes 
in arms control treaties because it would upset our negotiating 
partner. The Soviets promptly renegotiated the changes we made with 
respect to the INF treaty, a very fundamental change on the question of 
the very definition of the missiles that were the subject of the 
treaty. So are we to conclude that we can amend arms control treaties 
but not trade agreements, or even legislation dealing with trade 
agreements?
  Trade has now become a varsity sport in America, especially here in 
Washington. It is very important to our well-being, important to 
millions of workers, important to the quality of our environment, 
important to the world's environment. It is important to large 
industrial and service sectors, a matter of such importance that we 
should at least pay careful attention to our constitutional 
responsibilities. The final product will be more in the national 
interest and Senators will have done their duty to their constituents 
and to our Nation, as it was envisioned by our Founding Fathers, if we 
debate this matter at length and if we offer amendments, debate them in 
good faith, and have votes up or down on them and let the chips fall 
where they may.
  Is it not possible that we might improve this legislation by the vote 
of a majority here in the Senate? Suppose one were to offer an 
amendment vital to our security interest. It is not germane, but there 
is no rule of germaneness in the Senate except under rule XVI with 
respect to appropriations

[[Page 17071]]

bills or when time agreements obtain or when cloture is invoked. So why 
not? Why not offer subject matter that is important to our national 
security interest?
  If there is a group of Senators who have, by tacit understanding, by 
a wink and a nod, or by words openly declared that they will oppose any 
and every amendment regardless of its complexity or its complexion or 
whether it is good or bad or in between--if there is such a group of 
Senators, why not abstain from that and let us vote? Let us have a vote 
up or down and have a vote based on the subject matter of the amendment 
without any prior agreement, without any wink or nod, if there be such. 
Let us see where the chips fall.
  Are we to say that this particular bill is the acme of perfection and 
we should not have any further amendments of any sort regardless of 
merit? I don't think that would be the right way to commence.
  Once granted, PNTR will be difficult, though not impossible, to 
retract. Any attempt to withdraw PNTR status in the future, if it is 
granted now, will cause an uproar, and not just in China. The 
diplomatic crowd in the aptly named Foggy Bottom here in D.C. will 
bleat that rejecting PNTR will upset delicate negotiations with the 
Chinese. The big business crowd will complain about lost opportunities 
to sell or invest in China. The Administration at the time will prate 
erroneously about Congress interfering with their sovereign right to 
conduct foreign affairs. And even in Congress, bills might be 
introduced, only to die an unremarked death in some committee or on 
some calendar. I have been here a long time. I have seen a lot of bills 
die and I know a thing or two about how to kill them. So I know that 
undoing a thing is much harder to do than doing it in the first place. 
It will be much harder to undo PNTR than it will be to grant it.
  So why are we apparently so gung-ho to have this sham debate and vote 
now, this year, this week or next? There is no great urgency. The bill 
will not even take effect until China's accession to the WTO is voted 
upon. Why do it now, just weeks after a damning report has been issued 
about China's role in the proliferation of missiles and missile 
technology? Why do it now--why not next week sometime or next month or 
next year sometime--mere weeks after Chinese authorities conducted 
another raid on a so-called Christian sect that resulted in three 
Taiwan-born American citizens and approximately 100 Chinese citizens 
being arrested for meeting in worship? Why do it now, just months after 
Chinese officials have made still more threatening gestures toward 
Taiwan?
  Why do it now, before the final negotiations on the bilateral U.S.-
Chinese trade agreement, particularly the trade subsidy portions, have 
been ironed out?
  Perhaps someone was listening to that advertisement I have heard on 
the TV so many times: Do it now, do it here. Well, we don't do it now.
  China's record on trade agreements is not stellar. Since 1992, six 
trade agreements have been made--and broken--by China. In the last two 
years, we have seen the effects of dumping on the U.S. steel industry, 
as well as on the apple industry. So why are we rushing this vote? Why 
now? Why are we rushing this in such haste that we will not even 
seriously consider amendments that might improve the legislation? It is 
hardly perfect, sprung like Minerva, fully formed, from the forehead of 
Jove, or like Aphrodite from the ocean foam.
  In that vein, I have several amendments prepared which I believe 
could improve this agreement. One concerns prospective U.S. investments 
in the Chinese energy sector. This amendment, if adopted, supports the 
market for clean energy technology in China's admittedly booming 
economy. I believe this amendment would pass the Senate. I think it 
would command a decided majority in the Senate, if left to its own 
merits. Sales of such clean technology helps U.S. firms, of course, but 
also provide a mechanism for the Chinese to improve their air and water 
quality, a necessary step if China is ever to step up to what should be 
leadership role for her among the world's developing nations with 
regard to climate change.
  Now I am all for dealing with global warming. I am for the Kyoto 
Protocols, if China will get on board. So why not have an amendment to 
that effect. Let's have a vote here in the Senate.
  After all, by the year 2015 at the latest, China is expected--let's 
see, I will be serving in my tenth term; that will be my tenth term. 
After all, by 2015 at the latest, China is expected to surpass the 
United States as the world's leading emitter of greenhouse gases. For 
her own sake, as well as for the future of all of us, China needs to 
step up to the plate and tackle her role in addressing the global issue 
of climate change. The United States would also benefit from this 
effort, as increased volume of clean technology sales helps to reduce 
prices and make the best technology more affordable to retrofit on 
existing U.S. facilities.
  My other amendments are perhaps somewhat more specific in nature. In 
light of China's less-than-sterling record of abiding by previous trade 
agreements, these amendments are focused on increasing the transparency 
of Chinese Government subsidies made to China's many state-owned 
enterprises, and on improving existing U.S. procedures for acting on 
dumping complaints. China has made vague promises about not dumping and 
about not providing unfair subsidies to her enterprises. Yet China has 
also staked a verbal claim to the status of developing nations, which 
would exempt her from any sanctions with regard to subsidies made to 
Chinese industries. My amendments would require reports on China's 
state-owned enterprises--what's wrong with that?--and the advantages 
they enjoy, which would better enable us to determine if China's 
actions are fair.
  Another of my amendments would add certainty to the sometimes 
excessively lengthy process used to determine if such subsidies have 
adversely affected U.S. companies and U.S. workers. These amendments 
will help us better to protect American manufacturers, American jobs, 
American workers, and American families from unfair trade practices.
  American trade negotiators have crowed that, in the U.S.-China 
Bilateral Trade Agreement, the United States has given up nothing, 
while the Chinese have made substantial concessions and have offered to 
significantly lower tariff rates on certain goods. But I argue that the 
United States is giving up something substantial, though not directly 
through the U.S.-China Bilateral Trade Agreement. We are making our 
part of the bargain now. We are giving up our annual review and 
extension of normal trade relations with China in favor of a permanent 
normal trade relations status. And we are doing it now, before China 
has to make a single concession as a result of the bilateral agreement, 
which, like PNTR, is contingent upon China's accession to the WTO. But 
I suspect that the Chinese may also be gambling on the fact that having 
once made the plunge in granting PNTR to China, the United States will 
give it to them even if they never make it to the WTO, or even if the 
details of the bilateral change are ignored. That is the way we are, 
and the Chinese know it as well as I do.
  We have an obligation to our constituents and to the citizens of our 
great Nation to look out for their best interests. The Constitution 
gives us a role. Yes, it does. This is the Constitution that I hold in 
my hand for all to see through that electronic eye. This is the 
Constitution. Article I, section 8 gives Congress the power to regulate 
interstate and foreign commerce. So why don't we utilize that power? 
Why don't we utilize it? The Constitution gives us a role in regulating 
foreign commerce. I am not sure that we perform that obligation very 
well. We grant--I don't--fast-track authority to the Executive to 
negotiate massive trade deals and leave ourselves without the ability 
to amend. We take away the Senate's right under the Constitution to 
amend. We grant fast-track authority to the Executive to negotiate 
massive trade deals and leave ourselves without the ability to amend 
them, as we did with NAFTA and GATT, both of which I voted against--
proudly, I voted against both.

[[Page 17072]]

  My State certainly did not benefit from those actions. West Virginia 
lost jobs and lost a lot of the diversity in its manufacturing base. 
China is an enormous potential market, perhaps, but she is also an 
enormous labor pool competing for jobs and competing at a price 
advantage. Our economy is strong, but we cannot all sit at computer 
keyboards and be information age technology wizards. As a Nation, we 
also need to actually make things and grow things. Production and 
farming are important. But I would not invest in planting a new apple 
orchard right now, with Chinese apples and apple juice flooding the 
U.S. market. I would think twice about establishing a new assembly 
plant or some factory right now that faces competition from lower-paid 
workers in China, who do not have the same labor protections that 
workers in the United States enjoy and deserve. The future is uncertain 
and cloudy.
  Who will get the prize? Chinese or American workers? Will China be 
rewarded despite a history of broken trade agreements, weapons 
proliferation, religious repression, poor labor protection, and 
aggressive foreign policy statements? Will China be rewarded before the 
final trade issues concerning subsidies have been inked in? Or will 
American workers enjoy a respite? Will American concerns for security, 
human rights, and fair trade hold sway for a little while longer? I say 
to my colleagues, let it wait. Let it wait. This debate, this vote, can 
wait until we have the leisure and the will to do it right. If we 
persist in this misguided charade of a debate with no intention of 
considering any amendments on their merits, I will fulfill my 
obligations. I will offer amendments--good amendments, useful 
amendments, not dilatory amendments. I hope they will not be tabled 
simply to avoid a vote up or down, to avoid going to conference.
  At this time, I believe it would be extremely unwise to simply rubber 
stamp the House bill and approve PNTR with China without amendments.
  Granting PNTR to China with no amendments and no conditions signals 
that the U.S. Congress has given up on putting worker rights and 
environmental standards on the international trade agenda. Coupled with 
the rhetoric of the President, the Vice President, and the U.S. Trade 
Representative in support of PNTR, congressional acquiescence will 
reduce American credibility on labor and environmental issues to 
virtually nothing.
  At this time, it is not known whether China will actually apply for 
membership in the WTO. But one thing is clear; the Chinese Government 
has not wavered in its absolute opposition to any consideration of 
labor rights and social standards in the WTO. Despite claims that a 
market economy is bringing democracy to China, the U.S. State 
Department's 1999 human rights report on China concludes that the 
Chinese Government's ``poor human rights record deteriorated markedly 
throughout the year, as the government intensified efforts to suppress 
dissent, particularly organized dissent.'' Documented human rights 
violations include torture and mistreatment of prisoners, forced 
detentions, denial of due process, and extra-judicial killings. Violent 
repression of all efforts to organize independent union activity 
continues.
  Given such a record, it would seem unbelievable to many that the 
United States Congress would grant a green light to PNTR with China, 
without so much as even a nod toward conditions or amendments.
  Are we to turn a blind eye to every deeply held principle we have as 
a people about justice, freedom, and right and wrong for the pie-in-the 
sky promises of economic gain? I hope not. For that would be much, much 
more than a sell-out. That would be a shame.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. MOYNIHAN. Mr. President, I rise with deference and not a small 
measure of awe at the continued erudition of my colleague from West 
Virginia. The first decision I made when I came to the Senate was to 
support him for majority leader, and I have not made one of equal 
consequence since. None has given me greater pleasure.
  I say on the question of amendments that it is a point of 
significance. When the Finance Committee reported a measure on its own, 
it was a two-page bill. It was not a complicated matter. It was just 
agreed to. It will allow us to reap the benefits of an agreement that 
was reached between two countries.
  Now, I must say with absolute openness--and I hope always to be such. 
Yes. It is the hope of the managers of the legislation that the Senator 
from Delaware, the chairman of the Finance Committee, and the ranking 
member, that we not amend the House bill. We have agreed to take up 
H.R. 4444, because if we amend it with a semicolon, it will require us 
to go back. The bill will go back. I do not have to tell the Senator. 
It will have to go to conference and pass the House again, and then 
come here and pass the Senate. Time has run out. This would have been a 
wholly acceptable and sensible approach in May, but here we are in 
September of an election year in the last weeks of the Senate.
  So the Senator from West Virginia is right. He said he has read it in 
the newspapers. I stand here to tell him that it is the case. I hope we 
made no effort to conceal this. It is simply our judgment and the 
administration's judgment.
  I would like to say one last thing about fast track. The Senator 
could not be more correct--that we have given up our right to amend the 
trade agreements. But we did that in the aftermath of the disastrous 
experience, which was the Smoot-Hawley Tariff Act of 1930. If you were 
to make a list of five events that led to the Second World War, Smoot-
Hawley would be one. We raised our tariffs to the 60-percent level by 
trading on the floor in the most normal political process that works 
very well in most matters. But in trade it can be ruinous. We reached a 
level of tariffs of 60 percent. We were in that early stage of a sharp 
market crash. The economy was down. But it came back up. But with 
Smoot-Hawley, indeed imports dropped by two-thirds. And exports dropped 
by two-thirds. The British went off free trade into commonwealth 
preferences. The Japanese went to the Greater East Asian Coprosperity 
sphere.
  In 1933, with unemployment rates of almost 33 percent, Germany 
elected Hitler chancellor.
  So under Cordell Hull, that great statesman from Tennessee, and 
Secretary of State under President Roosevelt, we began reciprocal trade 
agreements. We gave the President the authority to negotiate reciprocal 
reductions in tariffs without coming back for the formal approval of 
the Congress. This was the predecessor of, the precedent for, the fast 
track procedures that were established in the Trade Act of 1974. In 
effect, the Congress itself said we will deny ourselves this 
temptation, if you like. We can always take it back.
  Indeed, right now the President has no fast-track authority. It 
expired in 1994. He could not get it in the atmosphere of the divided 
parties.
  It is that atmosphere, too, that leads us to believe that we should 
not send this measure back to the House. It had been thought that the 
permanent normal trade relations bill might pass by two or three votes. 
It was more, but not overwhelming. As the Senator from West Virginia 
knows, here in the Senate Chamber 86 votes were cast in July on the 
motion to proceed.
  I want to be open about this matter, if I can, and as I am. There is 
nothing more to say than what I have said, save that I believe I have 
more time--possibly 3 hours--apportioned to me in this debate. If the 
beloved President pro tempore--and all of those things--would wish more 
of my time to speak further, he would only have to ask.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from West Virginia.
  Mr. BYRD. Mr. President, I thank the very distinguished senior 
Senator from the State of Alexander Hamilton, New York. Alexander 
Hamilton was the only one of the New York delegation who finally signed 
the Constitution. He was one of the truly great statesmen in the early 
life of this Republic. He

[[Page 17073]]

helped guide the people of that delegation at the Convention to a 
resolution concerning this great document, and one who helped, along 
with John Jay and James Madison, to write those, if I might use the 
word, ``immortal'' papers, the Federalist Papers. He helped to win the 
approval of the State of New York for the Constitution.
  There is no one with whom I would rather, very honestly, discuss this 
particular subject in the Senate than the Senator from New York because 
I am so opposed to the view that he has just expressed. I am so opposed 
to it. I could with much greater passion say that if it were someone 
else.
  I respect the Senator. I admire him. I know he was and is the great 
teacher. I wish I had had the good fortune to sit in a class and listen 
to Senator Moynihan speak as a Professor.
  I am proud to say that I had much to do with Senator Moynihan's being 
a member of the Finance Committee, as he also had to do with my 
becoming majority leader.
  But I am very, very much opposed to this approach. I am very, very 
much opposed to and somewhat chagrined and disappointed, I say with due 
apologies to my friend, at the philosophy which seems to govern the 
Senate at the moment with respect to this legislation, with respect to 
not adopting amendments.
  The distinguished Senator has had no hesitancy whatever. He is not 
doing something behind closed doors or under the table or under the 
desk, but sitting it on front of the desk: This we are doing and this 
is why we are doing it.
  He honestly believes that is the best for his country. I admire that. 
I respect the Senator for that forthrightness. He would not be 
otherwise but forthright. I respect his reasons, therefor. However, I 
cannot agree with him. I am totally, absolutely, unchangeably, 
unalterably set in my viewpoint that this is not the right thing to do; 
it is not in accordance with the Constitution of the United States; it 
is not in accordance with the wishes, the intentions of the framers. So 
be it. I am not going to argue that point. We will just disagree and be 
as great friends as we have ever been. And the Senator will win when we 
cast our final vote on this. His conscience will be clear and mine will 
be clear.
  My State has lost under these trade agreements--GATT. Our country has 
lost under NAFTA. It is my understanding that we have lost 440,000 
workers in this country as a result of NAFTA. Those are the statistics 
my staff has been able to get from the administration.
  As I say, I will not belabor the point further. I thank the 
distinguished Senator for leadership that he has given the Senate. He 
is a man who has always enjoyed the respect of his colleagues whether 
he agrees or disagrees in a particular matter. He doesn't go out of 
this Chamber and carry it with him. We all love him, and we will all 
hate to see him go. But I will say to him, of his illustrious words 
that have been spoken in the Senate so many times, I have very 
carefully listened to them, and they will never dim from my memory.
  The PRESIDING OFFICER. The Senator from New York's time has expired.
  Mr. MOYNIHAN. I ask for an additional 1 minute to thank my 
illustrious, incomparable colleague for his remarks.
  I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. BYRD. 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. BYRD. Mr. President, inasmuch as no Senator seeks recognition, 
and there is a little time remaining before the Senate goes back to the 
appropriations bill dealing with energy and water, I ask unanimous 
consent that I may speak for not to exceed 10 minutes without the time 
being charged against time under the rule.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________