[Congressional Record (Bound Edition), Volume 147 (2001), Part 16]
[Senate]
[Pages 22692-22694]
[From the U.S. Government Publishing Office, www.gpo.gov]



                          INTERNATIONAL TRADE

  Mr. DORGAN. Mr. President, let me talk just for a moment about 
international trade because there has been a trade conference in Doha, 
Qatar. I expect the people who run the WTO chose that place largely 
because they did not want to have a trade conference where there were a 
lot of hotel rooms. Experiences in trade conferences in recent years 
have not been good. Thousands and thousands of people from around the 
world have come to demonstrate and express concerns about one thing or 
another. So they decided to have a ministerial conference in Doha. My 
understanding is there are so few hotel rooms in Doha that they had to 
bring in cruise ships in order to provide lodging for visitors to Doha.
  Because of other business this week, I didn't pay a lot of attention 
to what they did at Doha.
  I do know that all these trade folks converged and they had a long 
visit. I watched part of a similar visit in Montreal some years ago. I 
watched part of the visit they had in Seattle. So I know they all get 
together. They have the same backgrounds, and they talk the same 
language. They actually have shorthand for all the trade lingo that 
they develop. Apparently now, from the experience of recent days in 
Doha, they have decided they have reached some agreements on a new 
round, and so forth.
  So I want to point out just a couple of concerns I have about where 
we are with international trade.
  I have a chart that shows a series of balloons that represent the 
very serious trade problem confronting us in this country. It is a 
trade deficit that is ballooning, year after year after year. It is the 
largest trade deficit in human history.
  We spend a lot of time worrying about the fiscal policy budget 
deficit that about 9 years ago was almost $300 billion a year. There 
was hand wringing and teeth gnashing and people wiping their brow, and 
they would come to the floor of the Senate, saying they wanted to 
change the Constitution, they wanted to do this and that. Why? Because 
we had this growing budget deficit, this tumor that was growing in the 
fiscal policy of this country. It was going to hurt this country.
  It is interesting that there is a deafening silence in this country 
about the trade deficit. It, too, is growing, much more rapidly, in 
many ways, than the fiscal policy deficit did. It is much higher at 
this point than our budget deficit was at its height. One can make the 
case, as an economist, that the budget deficit is something we owe to 
ourselves. This deficit we owe to others. This deficit will ultimately 
be repaid by a lower standard of living in the United States.
  My point is, this deficit is growing and growing and growing. After 
round after round of trade negotiations, we are in worse and worse 
shape. The question is, why?
  It is interesting, if you ask economists, they all give you different 
answers: It is because the dollar is too strong; the dollar is too 
weak; it is because our budget deficit is too high, not high enough; 
productivity isn't high enough. It depends on the economist that you 
ask.
  Having both studied and taught economics in college, I understand 
that the field of economics is certainly not a science. I consider it 
psychology pumped up with just a little bit of helium. All you have to 
do is ask, and you get an answer. It does not mean it is an informed 
answer. There are 100 different answers as to why our deficit is out of 
control. Ask any economist. They don't have the foggiest idea. We had a 
$449 billion merchandise trade deficit last year in this country.
  Now let me describe some of the details of trade. It is interesting 
that everybody talking about trade, especially those at the ministerial 
conferences, want to talk about the big picture: global trade. They 
never want to the talk about specifics. So here is a specific.
  We trade with Korea, which is a good friend of ours. This chart shows 
that last year Korea sent 570,000 automobiles to the United States to 
be sold in the United States. Do you know how many automobiles the 
United States sent to be sold in Korea? Was it 570,000? No, not quite. 
The answer: 1,700. So 570,000 cars coming our way and then we were able 
to export 1,700 cars to Korea. Get a Ford Mustang convertible here in 
the United States, send it to Korea, and it costs twice as much for a 
Korean consumer. Why? Because Korea does not want our cars. They do not 
want our cars coming in and competing. They have all kinds of 
mechanisms and devices to discourage our ability to move a car to 
Korea. The result is, 570,000 Korean cars in the United States; 1,700 
United States cars to Korea. Fair trade? I don't think so.
  Is that something we ought to correct? In my judgment, it is because 
these numbers translate to jobs. A working family, a man or a woman 
getting a job on an assembly line in a manufacturing plant, a job that 
pays well, a job with security, a job with benefits, these are good 
jobs. This means we export these jobs to other countries that produce 
products and send them to us and then keep their market closed to our 
products, which means fewer manufacturing jobs in the United States.
  I have another chart I did not bring to the Chamber. It shows T-bone 
steaks in Tokyo. Do you know that 12 years after the last beef 
agreement we reached with Japan, the conclusion of which resulted in 
feasting and rejoicing by everyone engaged in the trade negotiations--
you would have thought they just won the gold medal in the Olympics. 
The headlines trumpeted the beef agreement with Japan. What a wonderful 
agreement. Twelve years later, by the way, every pound of American beef 
sent to Japan has a 38.5-percent tariff attached to it--every single 
pound. Is that fair trade with Japan? No. Fair trade would be more T-
bone steaks to Tokyo, in my judgment. But we have a 38.5-percent tariff 
on every single pound.
  Going back to Korea: What about potato flakes to Korea? Up in my part 
of the country, in the Red River Valley, where the Presiding Officer 
also represents some potato growers, those potatoes are cut into 
flakes. Those potato flakes are sent around the world, and they are put 
into chips in fast food. Potato flakes are used for fast food. Well, 
that is probably a pejorative. I shouldn't say ``fast food.'' I should 
say ``snacks.'' Potato flakes are used for snacks.
  If you raise a potato in the Red River Valley and then turn it into 
potato flakes and send it to Korea, guess what happens to it? Korea 
slaps a 300-percent tariff on potato flakes.
  Are potato flakes going to threaten the Korean food market? I do not 
think so. Is it fair to an American potato farmer to confront a 300-
percent tariff? Where I live, it is not fair.
  I could spend a lot of time talking about these things.
  China: We have a huge trade deficit with China. We also have a huge 
trade deficit with Japan. We have a big deficit with Europe. We have a 
huge deficit with Canada and Mexico. But China, we sent 12 American 
movies into China in the last year. Why? That is all China would let 
into their country, 12 movies. Fair trade? I don't think so.
  Or how about this? In the last trade agreement we negotiated with 
China, we sent our negotiators to China. Now, presumably, these are the 
best negotiators we have. We sent them to China. I do not know how we 
sent them there, probably not on a slow boat, as the saying goes; 
probably in an airplane.
  They got to China and negotiated a bilateral agreement with China, 
which was the precursor to allowing China to join the WTO. They brought 
back the bilateral agreement, which we did not vote on because we do 
not have a vote on a bilateral trade agreement with China. Guess what 
we discovered?
  Let me give you an example. Automobiles: After a long phase-in, we 
have

[[Page 22693]]

decided--our negotiators agreed with the Chinese negotiators--we would 
have a 2.5 tariff on Chinese vehicles being sent into the United 
States, and China could have a 25-percent tariff on the United States 
vehicles sent to China. In other words, our negotiators sat down with 
the Chinese, with whom we had a $60 billion deficit, and we said to 
them: OK, we will agree to this deal. You go ahead and impose a tariff 
on U.S. cars sent to China that is 10 times higher than the tariff we 
will impose on any Chinese cars you send to the United States, and we 
will sign that agreement. That is what our negotiators said. So that is 
our agreement.
  I don't know, my feeling is these negotiators need to wear jerseys. 
They do in the Olympics. The jerseys should say: USA. At least they 
could look down, from time to time, and understand on whose behalf they 
are negotiating. They can say: Oh, yeah, that is who I represent. That 
is whose interests I represent, and not be bashful about standing up 
for our economic interests.
  By what justification ever should we agree to this sort of one-sided 
agreement: T-bones in Tokyo, automobiles to Korea, potato flakes to 
Korea, high-fructose corn syrup to Mexico, durum wheat to Canada. I 
could tell stories for an hour about this. In each and every 
circumstance, it is this country signing up to a trade agreement that 
is fundamentally bad for our producers.
  Our durum growers. I should, just for therapeutic purposes, spend 15 
minutes to talk about unfair durum trade coming to us from the Canadian 
Wheat Board, which would be an illegal entity in this country, a state-
sponsored monopoly that sends durum wheat into this country to undercut 
American farmers' prices, and then thumbs their nose at us when we say 
we want to see the prices at which you are selling because we believe 
they are violating our trade laws. I could spend a long time talking 
about that, about the day I went to the Canadian border with Earl 
Jensen in a 12-year-old, orange, 2-ton truck.
  All the way to the Canadian border we met 18-wheel trucks carrying 
Canadian durum south into the United States.
  So we got to the Canadian border, after meeting truck after truck, 
bringing Canadian durum south. We had 200 bushels of durum in Earl's 
little, orange truck, and the Canadians said: No, you can't come into 
Canada with 200 bushels of durum. Why not? Just because you can't. It 
is just the way life is. It is a one-way track across that border with 
durum wheat.
  I will not go on further. I know my colleague wants to speak. That is 
all a precursor to say this.
  My colleague, Senator Byrd, the other day, spoke about trade 
protection authority or fast track. In my judgment, what we ought to do 
is decide that we are going to stand up for this county's economic 
interests in international trade.
  Don't give anybody any fast-track trade authority. Say, go negotiate 
some good trade agreements, bring them back here, and we will sign up 
to vote for them. First thing in the morning, count us as supporters. 
Go negotiate bad agreements, which you have done time and time and time 
again, and understand they won't see the light of day here because we 
are sick and tired of it.
  I will not support fast track. We have been fast-tracked right into a 
huge hole, a trade deficit that has ballooned now to a $450 billion 
merchandise trade deficit. I will not support fast track.
  I agree with my colleagues, Senator Byrd and others: We need expanded 
trade. There is no question about that. I want to see global markets 
that are fair. I want to see opportunity for our farmers and our 
manufacturers around the world. But I also demand that we see trade 
agreements that step forward and protect this country's interests 
requiring fair trade. It is not fair trade with respect to movies in 
China, durum in Canada, high-fructose corn syrup with Mexico, cars in 
Korea, potato flakes in Korea and Mexico. It is not fair trade with 
autos in China. None of that is fair trade. There ought not be anybody 
who is nervous or worried about standing up and demanding fair trade 
with our trading partners around the world.
  I have not spent much time on this, but I intend to in the coming 
days, if the House and the administration, buoyed by the success in 
Doha, Qatar, decide they want to try to bring enhanced trade authority 
to the Senate.
  There is no problem at all negotiating trade agreements without fast 
track. The last administration wanted fast track. They didn't get it. 
But they said they negotiated 300 trade agreements. That means you can 
negotiate trade agreements without fast track. You just need to be 
careful to negotiate good ones because if you don't, you won't get them 
through the House and Senate.
  The inability to have fast track actually promotes more 
responsibility on the part of those who are required to negotiate these 
trade agreements.
  I wanted to follow on the remarks of Senator Byrd of 2 days ago on 
the subject of fast track. He and I and others will work very hard to 
try to see if we can't make some sense out of this mess, this trade 
problem that is now choking this country with very large trade deficits 
and is destroying manufacturing jobs and injuring this economy. We can 
do better than that even as we expand opportunities, even as we expand 
international trade. We can do better than that by standing up for 
fairness for American producers and farmers.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I did not intend to speak on this subject, 
but since the Senator from North Dakota has raised it, it is important 
to put all of this in perspective. Matters could be much better, but 
they are not quite as bleak as outlined by my good friend from North 
Dakota, not in my judgment. It is clear that other countries still 
intend to take greater advantage of America in trade matters than we do 
of them.
  We are a country of the world. There are other countries of the 
world. We have our views. They have their views. We have our social 
structure. They have theirs. It is incumbent upon us to find a way to 
be effective in protecting our American interests.
  Because the Senator from North Dakota might find this interesting, I 
would like to talk about beef, and beef with Japan and Korea, for that 
matter. I have forgotten how many years ago --it must have been maybe 
10, 12 years ago--Japan had a quota on foreign beef into Japan. It 
amounted to, if I recall, about 28,000 tons of hotel/restaurant-cut 
beef. That is a quota on all beef coming to Japan. That is American, 
Australian, and Argentine beef. That amounted to one 6-ounce steak per 
Japanese person per year--a very strong, tight quota against American 
beef sales in Japan.
  At the same time, we Americans imported considerably more pounds of 
beef than we exported worldwide. We imported far more beef worldwide--
lower cut grades for hamburgers and other things--than we exported.
  I decided I wanted to do something about the problem with Japan. I 
tried everything under the Sun. I remember in the Mike Mansfield Room--
Senator Mansfield was Ambassador to Japan, very highly regarded, very 
revered--I said: Why don't I invite the Japanese diplomatic corps up to 
the Mansfield Room and we will show to them how good Montana beef is. 
We will do all we can to get that quota reduced or eliminated.
  That was naive. Nothing happened. I might say, one member of the 
Japanese Parliament had the audacity to say the reason they have a 
quota on foreign beef is that their digestive system can't handle 
foreign beef. It is total nonsense.
  At the same time, maybe a few years earlier, we had a difficult time 
importing American skis into Japan, and their excuse then was: Well, 
Japanese snow is a little different. That is why we can't take American 
skis. They were totally ludicrous arguments.
  I decided I had had it with the Japanese on beef. So I had a press 
conference over in the Hart Building, and about 20 Japanese journalists 
showed up. I had a button on me. The button

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said, ``I have a beef with Japan.'' And I said to the Japanese, very 
respectfully, trade has to be a two-way street. I said: Japan, we take 
a lot of your products. We take your VCRs, we take your Hondas, we take 
your Seiko watches, and you don't take our beef. Trade has to be a two-
way street. It can't be one way. As you can see, it is one way. It is 
not right, and I am going to do what I can to stop that.
  At about that time, there was legislation on the Senate floor called 
domestic content legislation. That legislation required a certain 
percentage of content, manufacture, and assembly of autos in America to 
be American content, not foreign. It was domestic content legislation. 
At that point, I did not favor that legislation. I thought it was too 
prescriptive. It was wage/price controls--too controlling--although I 
agreed with the purport and the direction it was going.
  I said: If you don't take American beef, I am going to go right to 
the Senate floor and do all I can to get that domestic content 
legislation passed because that will be two way; that will be fair.
  My gosh, I could see scribbling of all kinds of notes, cameras going 
on. The next day there was a big article about my statement in the 
Japanese newspapers. My photo was in the Japanese newspapers. I can't 
read Japanese, but I know basically what I had said.
  Guess what. Within a couple of weeks, the Japanese sat down at the 
bargaining table. Mike Armstrong was our trade negotiator at the time. 
They needed to negotiate, and they agreed to eliminate that quota 
entirely. But they did replace it with a 70-percent tariff. That is 
pretty high, but at least our industry said: That is great; the quota 
is eliminated. We can start importing beef into Japan.
  I go over to Japan a couple, three times. I know about two words in 
Japanese. I learned this one. It is ``Oishii,'' which means delicious. 
I would stand in front of the Japanese cameras and say: American beef 
is Oishii, delicious. At the same time, a Japanese polling company 
showed that the Japanese housewives and Japanese citizens of Tokyo 
wanted American beef by far. Under the Japanese constitution, because 
the rural districts have disproportionate voting power, they want to 
protect themselves. That is why they had that quota. The quota was 
eliminated, replaced with a 70-percent tariff.
  We also agreed to bring that tariff down. The Senator from North 
Dakota says it is now down to around 28 percent. That could well be. It 
is my recollection that eventually that tariff will be down at a lower 
rate. The point is that we have made progress with Japan. We now, by 
the way, export more beef overseas than we import. That line was 
crossed about 2 years ago. So there is progress.
  These things are more complicated than meets the eye. But we 
certainly have a lot more to do and further to go. As in the Korean 
situation, Korea had this provision--this was about 2 years ago--called 
the shelf life law. They wouldn't let boats unload beef products, 
canned beef, for over 2 weeks. Their distribution system wouldn't let 
foreign beef get to the grocery stores. That was bad beef under Korean 
law.
  The Korean Prime Minister was, for about 2 or 3 months, coming over 
to the United States.
  So I got ahold of him. I said: Mr. Ambassador, your Prime Minister is 
coming over. I have a letter signed, with many Senators cosigning who 
are opposed to this. I don't think you want your Prime Minister to come 
over when we are getting up on the Senate floor being critical of 
Korea.
  He got the message. Within 2 weeks, they repealed the provisions and 
allowed in American beef.
  So it is important for us to think of how we can get this job done 
and make sure these other countries play fair. If we work well in a 
concerted effort with the trade negotiators, we can get some things 
done. But I have also learned deeply that no country altruistically is 
going to lower a trade barrier. You need leverage.
  I urge that as we move forward to protect American interests, we find 
the proper persuasion to help each other. I see the assistant majority 
leader anxiously waiting to seek recognition.
  I yield the floor.
  (Ms. CANTWELL assumed the Chair.)
  Mr. REID. Madam President, I thank my friend. I extend my 
appreciation to the chairman of the Finance Committee, the senior 
Senator from Montana, who is so important to this institution.

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