[Congressional Record (Bound Edition), Volume 156 (2010), Part 3]
[Senate]
[Pages 2959-2961]
[From the U.S. Government Publishing Office, www.gpo.gov]




                             TAX LOOPHOLES

  Mr. DORGAN. Mr. President, earlier today we passed some legislation 
in the Senate that is important and will create jobs in our country, 
and I filed an amendment that was not considered. I know that was the 
case with many amendments on the bill. One of the amendments I filed 
that was never considered, unfortunately, and I hope will be considered 
in the future deals with the recommendation the President made during 
his State of the Union Address.
  In the State of the Union Address, the President spoke about jobs and 
said one of the things we ought to do to try to preserve and keep and 
create jobs in our country is to shut down or eliminate the tax 
loophole that rewards companies for moving jobs overseas. The President 
specifically asked in his State of the Union Address for the Congress 
to eliminate that tax loophole. I have tried to eliminate that loophole 
I think on four different occasions on the floor of the Senate. We have 
had four votes. On each occasion, I have failed.
  One might ask, well, how on Earth can you fail on an amendment such 
as that? Well, there are a lot of big companies and groups in this 
town--the Chamber of Commerce is an example--that like that loophole 
and want it retained, and they fight very hard to keep the loophole.
  Here is what we have. We actually do have a circumstance where if you 
are on one side of a street corner and you have a competitor on the 
other side of the street making the identical product you do, earning 
the identical income you earn, and you decide you are going to move 
your plant to China, fire your workers, put a padlock on the front door 
of your manufacturing plant and move to China, the only difference 
between you and the person across the street that you used to compete 
with and still do is that you now have lower labor costs but you also 
have a tax break given to you by the Federal Government. It is 
astounding that exists, but regrettably it does. The President's call 
to eliminate the tax break is very important, and we ought to heed that 
call.
  I filed an amendment on the last bill, the one that passed today. I 
did not get a vote on it. I intend to file it again on other pieces of 
legislation because this Congress, at a time when so many millions of 
people get up in the morning and put on their clothes and go out 
looking for work and cannot find work, this Congress has a 
responsibility to deal with this issue.
  Think of this issue of trying to find jobs that are necessary to put 
17 million people back to work as trying to fill a bathtub. We are 
working on a faucet to incentivize and create new jobs, but the drain 
is wide open, the drain of existing jobs going overseas; in fact, going 
overseas in search of cheap labor because this country actually rewards 
you if you move your jobs overseas.
  This is Hershey's chocolate. Many people have eaten York Peppermint 
Patties. York Peppermint Patties were made in a Pennsylvania plant but 
no longer. It is now Mexican food.
  This is a newly built plant in Monterey, Mexico, now making York 
Peppermint Patties. On its Web site, Hershey's says:

       That cool refreshing taste of mint, dipped in dark 
     chocolate will take you miles away.

  Apparently meaning even Mexico. So an American brand goes south. That 
is not terribly unusual.
  Hallmark Cards: ``When you care enough to send the very best.'' It is 
a privately held Kansas City company. It has been around 100 years. It 
was founded by a high school dropout who started the company in 1910 
with a shoe box of postcards he sold while living out of a YMCA. It is 
an unbelievable success story, Hallmark Cards. The company became far 
and away the most successful greeting card company in America, with a 
reputation of treating its workers fairly--a very good company.
  But under current management, with annual revenues over $4 billion, 
they started to move jobs from Kansas City to three plants in China. It 
moved thousands of jobs overseas, though it is not required to disclose 
the specific numbers.
  What kind of a card do you send to a Hallmark worker whose job is now 
in China? The very best? We have a right in this country to be 
concerned about that.
  I have talked at length about Radio Flyer, the little red wagon, gone 
from Illinois to China; Huffy bicycle gone from Ohio to China. I spoke 
about those at length. But there are new ones as well.
  Whirlpool. At a time when we are losing so many jobs because of the 
deep recession, Whirlpool announced last year it was shutting down a 
1,100-worker factory in Evansville, IN, and moving the work to a 
factory in Mexico. Whirlpool made this decision even

[[Page 2960]]

though the company accepted a $19.3 million grant by the U.S. 
Department of Energy as part of the Recovery Act to develop ``smart 
appliances.''
  By the way, this is a picture of a Whirlpool worker walking out of 
his place of employment, the last walk on the last day. One can wonder 
what was going through his mind as he understood he was going to have 
to tell his family he is now out of work. His job still exists, but it 
exists in a foreign country.
  This is Natalie. Natalie worked for Whirlpool. She is 42 years old. 
She worked at the Whirlpool appliance plant in Evansville for 19 years 
and in November of last year was told her job is moving to Mexico; $17 
an hour was too much to pay, and you can get cheaper labor elsewhere. 
She described that plant closing ``like a punch in the gut.'' You can 
imagine what it is like.
  I am told local workers and local officials did everything they could 
to try to keep that Whirlpool plant in Evansville, IN, but they were 
unsuccessful.
  We do see a lot of people wearing football jerseys. This is a Reebok 
Peyton Manning jersey. My guess is they sell a lot of those things. 
There is not a better quarterback in professional football. He is quite 
an extraordinary football player.
  Reebok makes this jersey. This jersey is made in El Salvador by a 
Chinese-owned company. This jersey is sold for $80 in the United States 
and workers are paid 10 cents for the work they do in El Salvador to 
make it.
  Let me say that again. The workers get 10 cents, one thin dime, and 
the customers pay $80 for the Peyton Manning Reebok football jersey.
  Here is a photograph that shows the conditions of a sweatshop in El 
Salvador owned by the Chinese. According to the National Labor 
Committee that investigates these things, workers are forced to put in 
12 to 15 hours of unpaid overtime each week. They earn wages that are 
77 percent lower than the basic subsistence wage for the region. This 
is the photograph of the home of a worker at one of the Chinese-owned 
sweatshops. You can see the repressive poverty that exists there, and 
they get a dime for a jersey the company is paid $80 for on the store 
shelf in the United States.
  La-Z-Boy chairs announced it would eliminate 1,050 employees in 
Dayton, OH, and move production plants to Mexico. I have spoken about 
La-Z-Boy previously. A few days ago when I talked about jobs, I talked 
about how La-Z-Boy went to Pennsylvania and bought Pennsylvania House 
Furniture. Pennsylvania House Furniture is a high-end furniture 
company, using special Pennsylvania wood to make terrific furniture. 
They had great craftsmen who worked at that company. La-Z-Boy bought 
the company. They did not want to have competition for La-Z-Boy in the 
country, so they moved Pennsylvania House Furniture to China and 
shipped the Pennsylvania wood to China, put the furniture together, and 
shipped the furniture back to the United States.
  On the last day of work at the Pennsylvania House Factory, a company 
that had been around for 100 years, on the last day the plant was open, 
all those craftsmen who were proud of their jobs and proud of their 
work, when the last piece of Pennsylvania House Furniture came off the 
assembly line, they turned it over, and on the bottom of that last 
piece of furniture, every single worker at that plant came over and 
took the pen and signed their name. Somebody in this country has a 
piece of furniture that they do not quite understand. It has, on its 
bottom, the signature of craftsmen who worked for a company that for 
100 years made fine furniture in America. They wanted to do that 
because they wanted to sign their name to a quality piece of furniture 
made by an American worker who was proud of their job.
  La-Z-Boy chairs sent Pennsylvania House Furniture to China. Now we 
understand La-Z-Boy furniture has announced it will eliminate 1,050 
jobs in Dayton, OH, and move the production to a plant in Mexico. They 
moved other jobs to China. In a statement describing the 2008 layoffs, 
the company said: We regret the impact these moves will have on 
families and the lives of employees affected and so on.
  I have demonstrated enough. I have a lot of examples of this, and I 
have, over the years, provided a lot of examples. But I wish to 
demonstrate that on Wednesday, today, 17 million or so people got up, 
wanted a job and couldn't find it, struggling to try to figure out how 
on Earth they can make a living, how they can provide for their family.
  Here is part of what is happening. This shows the deepening trade 
deficits our country is experiencing. All this red demonstrates jobs 
moving elsewhere--American jobs moving elsewhere.
  This is a description of our trade deficit with China, the largest, 
single bilateral deficit in the history of humankind. I know where some 
of these jobs have gone. I know where they make Huffy bicycles. I know 
where they make Radio Flyer little red wagons. I know where they make 
Etch A Sketch. I know where they went. They went to China, and I know 
why they went there. Because they can hire people at 50 cents an hour. 
They can work them 12 to 14 hours a day, 7 days a week.
  The people in Ohio are told: You cannot compete with that. We have to 
pay you $11 an hour to make bicycles; you can't compete; sorry, you are 
out of here.
  The question of a century, when we have developed safe plants, 
minimum wage, retirement benefits to lift America up, when we developed 
those standards, retirement programs, health benefits, the question at 
the end of a century is: Do we decide those standards don't matter, the 
lifting of those American workers to good jobs that pay well doesn't 
matter because we are now saying to them: You compete with Third World 
conditions, you compete with Chinese sweatshops in El Salvador making 
football jerseys, you compete with people living 12 in a room, sleeping 
at night, when they do get a chance to sleep, in cinder blocks in China 
in Shinsen making children's toys; is that what we are saying is the 
kind of competition with which we want the American people to have to 
compete? Because they cannot. Nobody can make a living working for 50 
cents an hour here. You cannot make a living here if they strip away 
your retirement and health care and give you 50 cents an hour and tell 
you to work 7 days a week.
  The reason I raise this point is because the President said a month 
and a half ago, when he spoke to the Nation and spoke to the Congress: 
Close this tax break that rewards companies that move their jobs 
overseas.
  My position is not antibusiness. I want American businesses to 
succeed. I want them to make profits and create jobs. I just want an 
understanding that trade agreements must be fair agreements in order 
for us to compete. I will give an example.
  This is an example of automobiles in Korea. Ninety-eight percent of 
the automobiles driven on the streets of South Korea are made in South 
Korea. Is that an accident? Of course not. That is exactly the way the 
Koreans want it. They want to ship Korean cars to be sold in America, 
but they don't want American cars to be sold in Korea. That has always 
been their position. The same is true with China.
  We now have an agreement with China by which, in the next couple 
years, we will have a massive influx of cheap Chinese goods coming into 
this country in the form of automobiles. They probably want me to say 
less expensive automobiles from China. We have an agreement that when 
Chinese automobiles come here, we will impose a 2.5-percent tariff. If 
we ship cars to China, they will impose a 25-percent tariff, and we 
agree to that. That is fundamentally ignorant of our economic 
interests. Those are the kinds of issues we have to address.
  If we care about jobs, we need to do two things: One, work on the 
legislation of the type we are working on. Senator Reid, Senator 
Durbin, myself, and others have worked very hard on legislation to try 
to incentivize the creation of new jobs in our country. We passed a 
bill about a week and a half ago and passed another bill today that is 
job creating. That is the faucet. We are trying to turn the faucet on 
to put

[[Page 2961]]

jobs into this tub here. The problem is, the drain is wide open and we 
have jobs moving out just as aggressively. We have to plug the drain by 
saying: Trade matters, fair trade matters most. You must stand for the 
interests of good jobs that pay well in America. That is a fact.
  I will speak more about this issue at another time. I did wish to say 
I filed the amendment on the bill we finished today and was not able to 
call it up, as was the case with many amendments. I intend to file it 
again on another bill. I hope very much we will get a vote on it, and I 
hope, when we get a vote on it, that given the things I just described 
that are happening to jobs in America, given the fact the President has 
said let us at least plug this unbelievably pernicious, ill-advised tax 
break for companies that ship jobs overseas, let's at least get that 
done. Let's try to save some jobs in this country. If we can do that, 
we will have done something very significant for the people who awaken 
in the morning jobless and who hope to find work at some future date as 
we restart the engine and start putting American workers back on the 
payroll again.
  I yield the floor.

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