[Congressional Record (Bound Edition), Volume 147 (2001), Part 13]
[Senate]
[Pages 18698-18699]
[From the U.S. Government Publishing Office, www.gpo.gov]



                MILLIKEN JOINS HALL OF FAME FOR TEXTILES

  Mr. HELMS. Madam President, on September 10, Roger Milliken, a 
distinguished American, was inducted as a charter member of the Textile 
Hall of Fame in Lowell, MA.
  Roger Milliken has long been a leader in the textile industry and his 
induction as a charter member of the Textile Hall of Fame was well-
deserved. But Roger Milliken is far more than an outstanding American 
industry leader. He is a true patriot, and his love of country 
constantly manifests itself in countless ways.
  Roger Milliken's genuine commitment to the health of the American 
economy is unfailing and unyielding. It is typical of his nature and 
his fidelity to his country that he used the occasion of his induction 
into the Textile Hall of Fame to sound a warning about the continuing 
erosion of the U.S. manufacturing base--and the hollowing-out of the 
U.S. economy--by the displacement of solid manufacturing jobs in 
America to low-wage paying countries all over the world.
  You see, Roger Milliken has steadfastly supported keeping American 
manufacturing strong but too often, his wise counsel has gone unheeded 
by the so-called ``trade experts.''
  But make no mistake, in the name of globalization, our trade policy 
is, in fact, encouraging overproduction, as subsidized foreign 
industries flood the global market and bring prices in this country 
below the cost of domestic production.
  The economic threat has been eating away at our manufacturing base 
slowly but surely. In this year alone, the malignancy will result in 
the loss of 1 million American manufacturing jobs. In the U.S. textile 
industry, more than 600,000 jobs have been lost since NAFTA and the 
Uruguay Round's Agreement on Textiles and Clothing became effective in 
1995.
  Sadly, precious little attention is being paid to the real victims of 
this trade policy: the small towns and medium-sized cities throughout 
America devastated by plant closings and job losses. The textile and 
apparel industry in the South is only one part of the tragedy. The same 
can be said of the auto industry, the steel industry, and even the 
high-tech semiconductor industry in California.
  Roger Milliken's eloquent statement on behalf of American 
manufacturing rings clear, and it merits the attention of the Senate. I 
therefore ask that excerpts from the Milliken statement--entitled ``The 
Wealth of Nations: U.S. Manufacturing in Serious Trouble'' be printed 
in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

      The Wealth of Nations: U.S. Manufacturing in Serious Trouble

                          (By Roger Milliken)

       Today almost all of the manufacturing industries in the 
     United States are in serious trouble. I would like to take 
     this time and this place to light a fire of debate on the 
     serious consequences of that statement on the future of our 
     country. . . .
       Thanks to Thomas Edison's invention of the electric light, 
     our industry learned in World War I that textile machinery 
     could run at night as well as during 12-hour daytime-only 
     shifts.
       At the end of that war, we found ourselves with 18 million 
     spindles in place north of the Mason-Dixon line and 18 
     million spindles south of the Mason-Dixon line, all of which 
     could be run around the clock. Our production capacity had 
     been doubled.
       Seventy years later, 1990, after a long period of fair 
     competition, we found ourselves with 18 million modernized, 
     surviving spindles in the South and 800,000 in the North, 
     producing more products and higher quality than the 36 
     million spindles after World War I.
       Today we are told that during that period the U.S. went 
     from an agrarian economy to an industrial economy and that we 
     are now similarly transitioning to an information-based 
     economy.
       As I see it, the main thing wrong with that comparison is 
     that in the first transition our country did not lose either 
     the farms or the products of those farms. In fact, 
     agricultural production increased as new technologies were 
     introduced. Today, our country continues to produce a surplus 
     of agricultural goods.
       During the current transition, the U.S. is losing both its 
     manufacturing plants and the products manufactured in them, 
     as well as the jobs they provide--thus putting at risk our 
     leadership position as the strongest manufacturing economy in 
     the world.


                      globalization's fatal flaws

       Our founding fathers, specifically Alexander Hamilton, 
     understood the importance of manufacturing. The second act of 
     the First Congress imposed tariffs on manufactured goods from 
     abroad. This encouraged our new nation, and its people, to 
     develop our own manufacturing base rather than merely 
     exporting low-value raw materials to our former colonial 
     masters and importing back from them the high value-added 
     finished goods. . . .
       Now as our country stands alone as the world's last 
     remaining superpower, we in textiles and almost all of U.S. 
     manufacturing find ourselves at risk of losing what our 
     forefathers fought so hard to create. This is neither 
     necessary nor wise.
       . . . At the current rate, we may end this decade with as 
     few as seven economically viable manufacturing industries 
     remaining in America.
       A recent survey of manufacturing revealed that 36 of our 44 
     existing manufacturing industries had an adverse balance of 
     trade and had cut substantial numbers of jobs this year. The 
     hemorrhage continues.
       All U.S. manufacturing employment is shrinking at a pace 
     which will eliminate 1 million high-paying, middle-class jobs 
     this year alone. This is four times what we lost in the year 
     2000. Actual employment levels in our vitally important 
     manufacturing sector have already fallen to levels last seen 
     in 1963.
       We are in an era of so-called globalization, and everyone 
     talks about the new economy. We have been lured into thinking 
     that the negative aspects of these trends are both 
     unstoppable and inexorable.
       Isn't it our leaders' responsibility to ensure that this 
     country and its people survive this period strong and 
     prosperous?
       A fatal flaw of the current idea of globalization is the 
     lack of recognition that subsidized global production creates 
     a strong incentive to create overproduction that outstrips 
     global demand.
       A further flaw is the lack of recognition that in emerging 
     economies the people and manufacturing production workers are 
     not paid enough to buy what they make. Instead, the fruits of 
     their labor are subsidized and shipped to the United States, 
     which serves as the market of first and last resort.
       In the process, our standard of living is undermined, and 
     both political and economic instability is increased. . . .
       Mounting consumer debt helped fuel the boom of the 1990s. 
     Despite strong productivity growth, the 80 percent of our 
     country's wage earners and their families who work for others 
     have not seen an increase in their real income over the past 
     20 years.
       As increase in purchasing power stagnated because of the 
     massive shifts of good, well-paying jobs to low-cost emerging 
     economies, we continued our growth of consumer spending, but 
     we did it on credit. Consequently, the American consumers 
     have been spending more than their earnings at the expense of 
     savings. The result is that we are consuming a billion 
     dollars more in manufactured goods each day than we produce. 
     These facts are a prescription for social, political and 
     economic unrest.
       Our manufacturing base is being eroded as dollars are 
     diverted from wealth creation to wealth consumption. If 
     economic history has any lesson for us, it is that a nation's 
     well-being is determined by what it produces, not by how much 
     it consumes.


                   altar of free and unfettered trade

       While technologies always present new opportunities and 
     challenges, globalism is not a new idea. It was born around 
     the time of Columbus, and most of world politics has been 
     about how to control it ever since. Past and present 
     administrations in Washington seem to think globalization is 
     something new for which the lessons of history are 
     irrelevant.
       George Santayana is quoted as saying, ``Those who can't 
     remember the past are condemned to repeat it.''

[[Page 18699]]

       A Spanish leader in 1675 bragged about Spain's trade 
     deficit, asserting ``all the world's manufacturing serves her 
     and she serves nobody.'' However, when its gold and silver 
     ran out, Spain found that its industrial development had 
     withered; it had only debts to show for its orgy of 
     manufactured imports and consumption. That Spanish empire 
     collapsed, and those countries who had expanded their 
     manufacturing capabilities by selling to Spain were the new 
     world powers.
       Thus it also was with the later demise of the Dutch empire 
     and subsequently the great British Empire, ``upon which the 
     sun never set.''
       Beguiled by the siren songs of banking, insurance, shipping 
     and services, they ultimately surrendered their world pre-
     eminence as nations. The Spanish, Dutch and British had all 
     neglected their nations' manufacturing bases.
       Could this happen to the U.S.A.? Or more to the point, is 
     it happening?
       I believe the process is already under way, and if we 
     continue sacrificing our manufacturing base on the altar of 
     free and unfettered trade, we will go the way of others.
       I believe it is happening because our leaders in Washington 
     remain unconcerned about our near three trillion dollars of 
     accumulated debt flowing from the dramatic growth of our 
     adverse balance of trade. In the span of the last dozen 
     years, we have gone from being the world's largest creditor 
     nation to being its largest debtor nation. And no end and no 
     limits are in sight. . . .
       Lester Thurow, of MIT fame, in his book ``The Future of 
     Capitalism'' (1996) said: ``If there is one rule of 
     international economics, it is that no country can run a 
     large trade deficit forever. Trade deficits need to be 
     financed, and it is simply impossible to borrow enough to 
     keep up with the compound interest. Yet all the world trade, 
     especially that on the Pacific Rim, depends upon most of this 
     world being able to run trade surpluses with the United 
     States that will allow them to pay for their trade deficits 
     with Japan. When the lending to America stops, and it will 
     stop, what happens to current world trade flows?''


                     bankrupting race to the bottom

       I believe that in a world where the American standard of 
     living, as well as power, is being daily challenged, our 
     political leaders in Washington must defend the economic base 
     upon which Americans depend for their security and their 
     livelihoods.
       Our leaders cannot expect to keep the public trust if they 
     abdicate their responsibilities to the electorate by making 
     decisions to placate bankers and Wall Street-pressured 
     corporate managers who exhibit diminishing national concerns.
       Everyone forgets that when Adam Smith called his seminal 
     work on economics ``The Wealth of Nations,'' he was arguing 
     against the notion that trade was the source of national 
     wealth when, to the contrary, he was arguing that domestic 
     manufacturing was the true source of national wealth.
       In his hierarchy of economic activity, agriculture came 
     first because of the need to feed the people; a strong 
     domestic manufacturing base was second as the core of 
     national growth; trade was rated third in importance, and was 
     to be used only to acquire resources or luxuries not 
     available at home.
       Smith understood that those nations who focus on trade to 
     the neglect of domestic manufacturing industry may be 
     enriching themselves but may also be doing the country great 
     harm.
       ``The beginning of wisdom on trade, and indeed all economic 
     policy, is to understand that the purposes of a national 
     economy are to enrich all its people, to strengthen its 
     families, its communities and thereby stabilize society. The 
     economy should serve us, not the other way around.''
       My friend the late Sir James Goldsmith understood this 
     imperative. He also understood that the U.S. economy--and the 
     world economy itself--cannot be returned to a sustainable 
     course unless we redress the recent massive global imbalances 
     between consumption and growing overproduction. He recognized 
     that only one basic approach to globalization could 
     accomplish this goal.
       He proposed that the United States make clear to its 
     trading partners, and its own multinational companies, that 
     if their products are to be sold in the United States, they 
     must be made substantially in the United States.
       As Sir James argued: ``America should use its matchless 
     market power to ensure that foreign and American corporations 
     become good corporate citizens of the United States. They 
     should bring us their capital and their technologies and 
     invest in the U.S.A. This would require them to hire workers 
     in the U.S., pay American wages, pay U.S. taxes, preserve the 
     environment, ensure human rights, and compete on the level 
     playing field that does exist among the 50 states. . . .''
       They should be reminded that since the American market is 
     by far the most important in the world, entry is not a right, 
     but a privilege. In other words, there should be a price and 
     a reward for doing business in the United States--making 
     meaningful, long-term contributions to America's continued 
     security and prosperity, and preserving the global 
     environment.
       Only then can we make sure we are engaging our people in a 
     race to the top, in living standards; economic stability; 
     quality of life; and personal security--not in a bankrupting 
     race to the bottom. . . .

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