[House Report 106-672]
[From the U.S. Government Publishing Office]
106th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 106-672
======================================================================
WITHDRAWING THE APPROVAL OF THE CONGRESS FROM THE AGREEMENT
ESTABLISHING THE WORLD TRADE ORGANIZATION
_______
June 12, 2000.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Archer, from the Committee on Ways and Means, submitted the
following
ADVERSE REPORT
together with
ADDITIONAL VIEWS
[To accompany H.J. Res. 90]
[Including Cost Estimate of the Congressional Budget Office]
The Committee on Ways and Means, to whom was referred the
joint resolution (H.J. Res. 90) withdrawing the approval of the
United States from the Agreement establishing the World Trade
Organization, having considered the same, report unfavorably
thereon without amendment and recommend that the joint
resolution do not pass.
CONTENTS
Page
I. Introduction.....................................................2
A. Purpose and Summary................................. 2
B. Background.......................................... 2
C. Legislative History................................. 3
II. Explanation of the Resolution....................................3
III. Votes of the Committee...........................................7
IV. Budget Effect....................................................7
A. Committee Estimate of Budgetary Effects............. 7
B. Statement Regarding New Budget Authority and Tax
Expenditures....................................... 7
C. Cost Estimate Prepared by the Congressional Budget
Office............................................. 7
V. Other Matters to be Discussed Under the Rules of the House.......8
A. Committee Oversight Findings and Recommendations.... 8
B. Summary of Findings and Recommendations of the
Committee on GovernmentReform and Oversight........ 9
C. Constitutional Authority Statement.................. 9
VI. Additional Views................................................10
I. INTRODUCTION
A. PURPOSE AND SUMMARY
H.J. Res. 90 would withdraw the approval of the Congress
from the Agreement establishing the World Trade Organization
(WTO).
B. BACKGROUND
The five-year review of U.S. participation in the WTO
Sections 124-125 of the Uruguay Round Agreements Act (URAA)
(P.L. 103-465) require the President to submit a special report
on U.S. participation in the WTO every five years from the date
the United States first joined the WTO. According to the Ways
and Means Committee Report on the URAA, ``The purpose of this
provision is to provide an opportunity for Congress to evaluate
the transition of the GATT to the WTO and to assess
periodically whether continued membership in this organization
is in the best interest of the United States.''
Congress received the first of the five-year WTO reports on
March 2, 2000. Chapter II of the ``2000 Trade Policy Agenda and
1999 Annual Report of the President's Trade Agreements
Program'' is the President's review of the WTO. The review
discusses accomplishments that took place during the last five
years, including: (1) expanded market access; (2) protection
for intellectual property rights; (3) development of a sound
and effective system to settle disputes; (4) expansion of the
rule of law; (5) conclusion of historic agreements governing
financial services, basic telecommunications services, and
information technology; (6) progress on the so-called ``built-
in'' agenda to continue to liberalize agriculture and services;
(7) progress on negotiations on electronic commerce; (8) growth
in WTO membership from 119 nations in 1995 to 135 in 1999; and
(9) the significant progress toward accession of China and
Taiwan, two countries comprising over 21 percent of the world's
population. Issues related to the future operation of the WTO,
which are discussed in the report, include moving forward with
the built-in agenda on agriculture and services and addressing
new issues such as biotechnology, electronic commerce, trade
and labor, and trade and environmental protection.
Following receipt of the report, any Member of either House
of Congress may introduce a joint resolution to withdraw
Congressional approval of the Agreement establishing the WTO.
Congress then has 90 session days from receipt of the report to
act on the joint resolution. The resolution is privileged and
cannot be amended. The Committee on Ways and Means has 45
session days after introduction of the resolution within which
to act on it or be automatically discharged.
H.J. Res. 90, a joint resolution which would withdraw
Congressional approval from the Agreement establishing the WTO,
was introduced March 6, 2000, by Rep. Ron Paul (R-TX).
If the resolution is passed and vetoed by the President,
each House may vote to override the veto before the end of the
90-day period or within 15 session days from the date on which
Congress receives the President's veto message, whichever is
later.
The GATT/WTO system of multilateral trade rules
Because of its strength as a trading nation and the
openness of its market, the United States has long sought to
establish an international trading system with a comprehensive
set of enforceable rules. The Uruguay Round was the eighth
round or series of multilateral trade negotiations under the
General Agreement on Tariffs and Trade (GATT). These
negotiations to expand trade, which date back to the
establishment of the GATT in 1948, were a response to the Great
Depression and the political upheaval and conflicts of the
1930s, which deepened as a result of protectionist policies
such as the Smoot-Hawley Tariff. Work under the GATT system
aimed at raising living standards and promoting international
economic growth through the opening of world markets has
spanned six decades.
The Uruguay Round Trade Agreements reached at the end of
1993 were noteworthy in that they greatly expanded coverage of
GATT rules beyond manufactured goods trade to include
agricultural trade, services trade, trade-related investment
measures, trade-related intellectual property rights, and
textiles. The most visible accomplishment of this multilateral
trade round was to establish the WTO to administer the GATT
agreements and to settle disputes among WTO members. The
strengthened dispute settlement system was a major goal of the
United States going into the Uruguay Round trade negotiations,
since the enforcement mechanism under the GATT was highly
susceptible to delays and stonewalling by countries having
political or other difficulties in bringing their trade
measures into compliance with GATT rulings.
C. LEGISLATIVE HISTORY
Committee action
H.J. Res. 90 was introduced on March 6, 2000, by
Representative Ron Paul and was referred to the Committee on
Ways and Means. On June 8, 2000, the Committee ordered
adversely reported H.J. Res. 90 to the House of Representative
by a recorded vote of 35-0.
Legislative hearing and oversight
On February 8, 2000, the Trade Subcommittee held a hearing
on the outcome of the World Trade Organization (WTO)
Ministerial held in Seattle. On March 30, 2000, the Committee
on Ways and Means held a hearing on the future of the WTO. At
these hearings, Members of Congress, Minnesota Governor Jesse
Ventura, former U.S. Trade Representative Clayton Yeuter, and
representatives from the business community expressed their
views on the United States' involvement in the WTO. Also,
Chairman Crane led delegations from the Committee to the WTO's
First Ministerial Conference in Singapore in December of 1996
and the Third Ministerial Conference in Seattle in December of
1999.
II. EXPLANATION OF THE RESOLUTION
Present law
Under WTO rules, the United States may withdraw from the
WTO by exercising the procedures set forth in Article XV of the
WTO Agreement, which requires six-months notice to the WTO
Director General.
Section 125(b) of the Uruguay Round Agreements Act (P.L.
103-465), which was approved by the House on November 29, 1994,
establishes a procedure under which Congress may withdraw its
approval of the WTO Agreement contained in section 101(a) of
the Act. Sections 124-125 of the Uruguay Round Agreements Act
(URAA) require the President to submit a special report on U.S.
participation in the WTO every five years from the date the
United States first joined the WTO. Following receipt of the
report, any member of either the House or Senate may introduce
a joint resolution to withdraw Congressional approval of the
WTO Agreement. Congress then has 90 session days from receipt
of the report to act on the resolution. The resolution is
privileged and cannot be amended.
Explanation of the resolution
House Joint Resolution 90 states that Congress withdraws
its approval, provided under section 101(a) of the Uruguay
Round Agreements Act, of the WTO Agreement Establishing the
World Trade Organization entered into on April 15, 1994.
While enactment of a resolution withdrawing Congressional
approval under section 125 would call into question the future
of U.S. participation in the WTO, it does not expressly provide
for the President to withdraw from the WTO. Nor would the
resolution put the United States in violation of its WTO
obligations.
Reasons for change
The Committee reports Mr. Paul's resolution to withdraw
Congressional approval of the Agreement Establishing the World
Trade Organization adversely, because it concurs with the
results of the President's five-year review of the WTO that
U.S. participation in the global trading system is vital to
``America's long term economic and strategic interests,
continued prosperity and strengthening the rule of law around
the world.'' While the WTO is a young institution that
continues to evolve by a consensus process in response to
concerns of Member countries, the Committee believes that the
benefits of U.S. participation are clear and compelling.
The Uruguay Round Trade Agreements are the most
comprehensive in history. Consistent with the Committee's
expectation when it considered legislation to implement these
agreements in 1994, they have promoted economic growth, job
creation, and an improved standard of living for Americans. By
lowering tariffs and a wide range of other barriers to
international trade and investment, they have led to increased
levels of world and U.S. output, trade, real income, savings,
investment, and consumption.
The WTO serves U.S. interests through three major
functions. First, WTO Member Governments agree on multilateral
rules for trade, which support a stable and predictable basis
for commercial decision-making that can by relied on by U.S.
farmers, workers, and businesses. With only 4 percent of the
world's population, and nearly four-fifths of the world's
consumers living outside United States borders, Americans need
the freedom to compete in foreign markets in order to generate
jobs and economic growth at home. According to the Council of
Economic Advisors, since 1994 approximately one-fifth of U.S.
economic growth has been linked to an expanding export sector.
It is well-known that export-related jobs are concentrated in
high-skilled fields and generally pay 13-16% more than the
national average. As the world's largest exporter, the United
States is the country that gains the most from an open
multilateral trading system.
Secondly, the United States has benefitted significantly
from the new system established in the WTO for enforcement and
the prompt resolution of trade disputes between member
countries. This new system has eliminated many of the
shortcomings of the earlier GATT system where the dispute
resolution process could be blocked by member countries and
often dragged out indefinitely. In the first five years of
operation, WTO Dispute Settlement panels and the Appellate Body
have become the most active and productive system for settling
conflicts currently operating in the field of international
law.
In general, the WTO dispute settlement process has proven
to be a powerful instrument for reducing conflicts and bringing
down barriers to U.S. exports. The United States has filed more
complaints to date than any other WTO member and also
participates actively as a third party in many other cases
relevant to our commercial interests. The United States has
prevailed in 25 of its 27 complaints acted on so far, either by
successful settlement or panel victory. Furthermore, in many
other instances the threat of litigation has led to a
satisfactory outcome for the United States under the
consultation procedures, without the need to invoke the formal
panel process.
As an example, enforcement is particularly important in the
area of intellectual property rights. Because WTO Member
Governments have accepted landmark rules for protecting
patents, copyrights, trademarks, and other forms of
intellectual property, the WTO has afforded unprecedented
protection to property rights associated with American research
and innovation.
Of great concern to the Committee, there have been two
instances where U.S. interests have been thwarted in the
dispute settlement process, although the United States was
victorious in the panel process. Specifically, the European
Union has refused to come into compliance with WTO rulings
against their import restrictions on bananas and hormone
treated beef. The United States was able toinvoke WTO rights to
suspend trade concessions (impose trade retaliation) in an amount
equivalent to the damage to the United States caused by the illegal
practices. The Committee intends to continue its oversight on this
matter. In addition, the Committee is concerned about the EU's
challenge to the U.S. Foreign Sales Corporation system (FSC). The
Committee disagrees strongly with the adverse panel and Appellate Body
decisions and believes the FSC rules, negotiated with the EU in the
early 1980s, fully meet WTO rules. Nevertheless, the Committee
recognizes the decision and intends to work with the Administration to
ensure that the United States is in full compliance with its
obligations. While the Committee strongly supports the U.S. objective
of achieving further reforms to the dispute settlement system by
addressing instances of recalcitrance and opportunities for delay,
there is no doubt that the new system is significantly improved, as
compared to the inconclusive panel process under earlier GATT rules.
The third major function of the WTO is to provide a forum
for ongoing negotiations to reduce trade barriers. In the five
years since Congress approved the Uruguay Round Trade
Agreements, WTO Members have concluded three new trade pacts,
all of which allow Americans to capitalize on competitive
strengths of our economy. Under the Information Technology
Agreement, concluded in 1996, tariffs have been eliminated on
$600 billion worth of trade including items such as
semiconductors, computers, and network equipment. Concluded in
1997, the Agreement on Basic Telecommunications reduced costs
in 95 percent of the global market for telecommunications. Also
in 1997, the WTO completed significant negotiations governing
trade in financial services covering $29.5 billion in global
security assets, $38 trillion in global domestic bank lending,
and $2.1 million in world wide insurance premiums.
Although the WTO Ministerial meeting, hosted by the United
States in December 1999, failed to result in agreement to begin
a new comprehensive round of WTO trade negotiations, Member
Governments did succeed earlier this year in launching talks to
reform further agriculture trade and to expand commitments from
WTO Members with respect services trade. The Committee views
both of these sectors as critical to U.S. economic growth.
Agenda items supported by the Committee in relation to the
future operation of the WTO include addressing new issues such
as biotechnology and electronic commerce. The Committee also
supports efforts to increase transparency in the WTO. In
particular, the Committee believes that the dispute settlement
process should be opened up by instituting the prompt public
release of documents, public meetings of panels, and acceptance
of amicus briefs.
With respect to the argument made by proponents of H.J. Res
90 that participation in the WTO threatens U.S. sovereignty,
the Committee continues to give close consideration to this
question, as it did when the Uruguay Round Agreements Act was
first submitted for Congressional approval in 1994. It remains
true that neither the WTO, nor its dispute settlement panels,
can force a change in U.S. laws or regulations. The United
States alone decides how to respond to panel decisions. The
United States and all WTO Members retain the right to set the
levels of environmental, health, and safety protection that
they deem appropriate, even when such levels of protection are
higher than those imposed by any other country. Generally, the
WTO rules simply require that Members opt for less trade-
restrictive measures if possible and avoid discriminating
against foreign products in favor of domestic products. For the
protection of U.S. exporters, the WTO stipulates that food
safety measures should be based on sound science.
In the future, the Committee expects the WTO to remain
fundamental to the formulation and execution of U.S. trade
policy, with its rules and principles serving as a central
guide for achieving new agreements to expand trade bilaterally,
regionally, and multilaterally. While much remains to be done
to improve the WTO, there is no doubt that it administers a
system which ensures that when U.S. goods, agricultural
products, and services are sent overseas, they receive more
equitable treatment than would otherwise be the case. In the
Committee's view, H.J. Res. 90 is dangerous and illogical,
because it would isolate the United States from this system and
damage our leadership in the international economy, thereby
undermining U.S. national economic and security interests.
III. VOTES OF THE COMMITTEE
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the following statements are made
concerning the votes of the Committee on Ways and Means in its
consideration of the resolution, H.J. Res. 90.
MOTION TO REPORT THE BILL
The resolution, H.J. Res. 90, was ordered adversely
reported by a roll call vote of 35 yeas to 0 nays (with a
quorum being present). The vote was as follows:
----------------------------------------------------------------------------------------------------------------
Representatives Yea Nay Present Representatives Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Archer..................... X ........ ......... Mr. Rangel....... X ........ .........
Mr. Crane...................... X ........ ......... Mr. Stark........ ........ ........ .........
Mr. Thomas..................... X ........ ......... Mr. Matsui....... X ........ .........
Mr. Shaw....................... X ........ ......... Mr. Coyne........ X ........ .........
Mrs. Johnson................... X ........ ......... Mr. Levin........ X ........ .........
Mr. Houghton................... ........ ........ ......... Mr. Cardin....... X ........ .........
Mr. Herger..................... X ........ ......... Mr. McDermott.... X ........ .........
Mr. McCrery.................... X ........ ......... Mr. Kleczka...... ........ ........ .........
Mr. Camp....................... X ........ ......... Mr. Lewis (GA)... X ........ .........
Mr. Ramstad.................... X ........ ......... Mr. Neal......... X ........ .........
Mr. Nussle..................... X ........ ......... Mr. McNulty...... X ........ .........
Mr. Johnson.................... X ........ ......... Mr. Jefferson.... X ........ .........
Ms. Dunn....................... X ........ ......... Mr. Tanner....... X ........ .........
Mr. Collins.................... X ........ ......... Mr. Becerra...... X ........ .........
Mr. Portman.................... ........ ........ ......... Mrs. Thurman..... X ........ .........
Mr. English.................... X ........ ......... Mr. Doggett...... X ........ .........
Mr. Watkins.................... X ........ ......... ................. ........ ........ .........
Mr. Hayworth................... X ........ ......... ................. ........ ........ .........
Mr. Weller..................... X ........ ......... ................. ........ ........ .........
Mr. Hulshof.................... X ........ ......... ................. ........ ........ .........
Mr. McInnis.................... X ........ ......... ................. ........ ........ .........
Mr. Lewis (KY)................. X ........ ......... ................. ........ ........ .........
Mr. Foley...................... X ........ ......... ................. ........ ........ .........
----------------------------------------------------------------------------------------------------------------
IV. BUDGET EFFECTS
A. COMMITTEE ESTIMATE OF BUDGETARY EFFECTS
In compliance with clause 3(d)(2) of rule XIII of the Rules
of the House of Representatives, the following statement is
made concerning the effects on the budget of this resolution,
H.J. Res. 90 as reported: The Committee agrees with the
estimate prepared by CBO which is included below.
B. STATEMENT REGARDING NEW BUDGET AUTHORITY AND TAX EXPENDITURES
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee states that
enactment of H.J. Res. 90 would have no budgetary effect.
C. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE
In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, requiring a cost estimate
prepared by the Congressional Budget Office, the following
report prepared by CBO is provided.
U.S. Congress,
Congressional Budget Office,
Washington, DC, June 12, 2000.
Hon. Bill Archer,
Chairman, Committee on Ways and Means, House of Representatives,
Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.J. Res. 90, a joint
resolution withdrawing the approval of the United States from
the agreement establishing the World Trade Organization.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Hester
Grippando.
Sincerely,
Barry B. Anderson
(For Dan L. Crippen, Director).
Enclosure.
V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE
A. COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS
With respect to clause 3(c)(1) of rule XIII of the Rules of
the House of Representatives (relating to oversight findings),
the Committee, based on public hearing testimony and
information from the Administration, concluded that it is
appropriate and timely to consider the resolution as reported.
H.J. Res. 90--A joint resolution withdrawing the approval of the United
States from the agreement establishing the World Trade
Organization
CBO estimates that H.J. Res. 90 is likely to have no
budgetary effect. The legislation would withdraw the U.S.
Congress' approval of the World Trade Organization (WTO)
agreement that was provided under section 101(a) of the
implementing legislation (Public Law 103-412). If the United
States were to withdraw from the WTO, possible changes in U.S.
collections of tariff duties could have significant budgetary
effects. However, the ultimate impact of the legislation is
unclear. In particular, it is not clear that enactment of this
resolution would require the United States to withdraw from the
WTO--and even if it did, there might not be any changes in
tariffs. Based on information from the Administration that
suggests that the legislation would not affect the application
of the WTO agreement to the United States, CBO concludes that
enacting H.J. Res. 90 would probably have no budgetary impact.
H.J. Res. 90 contains no intergovernmental mandates as
defined in the Unfunded Mandates Reform Act (UMRA) and would
not affect the budgets of state, local, or tribal governments.
Withdrawing from the WTO would broaden the conditions under
which the U.S. government could impose trade restrictions on
imports. Trade restrictions--such as increased tariff duties or
quota limits more restrictive than under current law--would
impose private-sector mandates on importers of affected items.
However, because the legislation would probably not affect the
application of the WTO agreement to the United States, CBO
concludes that H.J. Res. 90 would likely impose no new private-
sector mandates as defined in UMRA.
The CBO staff contacts are Hester Grippando (for federal
costs), and Patrice Gordon (for private-sector impact). This
estimate was approved by G. Thomas Woodward, Assistant Director
for Tax Analysis, and Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.
B. SUMMARY OF FINDINGS AND RECOMMENDATIONS OF THE COMMITTEE ON
GOVERNMENT REFORM AND OVERSIGHT
With respect to clause 3(c)(4) of rule XIII of the Rules of
the House of Representatives, no oversight findings or
recommendations have been submitted to the Committee by the
Committee on Government Reform and Oversight with respect to
the subject matter contained in H.J. Res. 90.
C. CONSTITUTIONAL AUTHORITY STATEMENT
With respect to clause 3(d)(1) of rule XIII of the Rules of
the House of Representatives, relating to Constitutional
Authority, the Committee states that the Committee's action in
reporting the bill is derived from Article 1 of the
Constitution, Section 8 (``The Congress shall have power to lay
and collect taxes, duties, imposts and excises, to pay the
debts and to provide for * * * the general Welfare of the
United States.'')
VII. ADDITIONAL VIEWS
We strongly support continued U.S. participation in the
World Trade Organization (WTO), and disapprove of H.J. Res. 90,
which would withdraw Congressional approval of the WTO
Agreement.
The WTO, and its predecessor, the General Agreement on
Tariffs and Trade (GATT), have opened foreign markets around
the world to U.S. goods and services, creating new
opportunities for U.S. businesses, farmers and workers. The
United States, which has one of the most open and transparent
markets in the world, clearly has benefitted from the market
opening work of the WTO and the GATT. The current strength of
the U.S. economy is due in part to WTO rules. Moreover, on the
whole, the WTO's dispute settlement system has been an
effective means for enforcing U.S. rights.
That being said, there is room for improvement. Five years
experience with the WTO system shows key areas where we need to
build on the solid foundation of the Uruguay Round and the six
previous rounds of multilateral trade negotiations in he GATT.
In particular, we see four key areas in need of reform.
First, we must open up the WTO to public view and public
input. Recent events made clear that as trade has increased and
had greater impact on people's lives, three is a greater desire
for knowledge about and participation in the development of
trade rules. Currently, the public is not aware of what happens
in the WTO, and as a result, there is widespread mistrust of
the institution. Opening the process--by de-restricting
documents more quickly, allowing public submissions to dispute
settlement panels, and opening panel proceedings to public
view--will help to de-mystify the institution, and ultimately
will go a long way toward alleviating some of the suspicions
surrounding it.
Second, we must continue to develop the WTO as an
institution that reflects the expanding scope of the trade
policy agenda. It is axiomatic that the issues implicated by
trade negotiations extend beyond tariff and other border
measures, partially because of advances in technology and of
increased economic integration. With respect to technological
developments, e-commerce, breakthroughs in biotechnology, and
other advances, have created new opportunities for increased
global trade. We must continue to develop appropriate and
effective policies and rules to address them. In the same vein,
we must tackle the other issues that have increased salience in
the trade context--including environmental protection and the
operation of labor markets.
We must promote greater understanding of the links between
trade and labor market issues and ensure the more consistent
enforcement of core labor standards as competition grows
between evolving economies and developed economies. This means
following through with the mandate set forth in section 131 of
the Uruguay Round Agreements Act by establishing a working
group on trade and labor in the WTO, as well as reaffirming the
link between trade and labor issues in our bilateral and
regional relationships. We also must move forward on bringing
environmental issues more meaningfully into trade discussions.
This means bringing the work of the WTO's Committee on Trade
and the Environment to bear on the work of WTO negotiating
groups. It also means committing additional resources to
performing environmental impact assessments before entering
into new trade agreements.
Third, we must work to make developing countries our
partners, rather than our opponents. This means not only
ensuring that the process of negotiations enables all Members
to participate in a meaningful manner, but also ensuring that
the benefits of trade liberalization reach the poorest
countries and the poorest people of the world. We need to
pursue a coherent policy of trade and aid by relieving the
least developed countries of overbearing debt and providing
technical assistance and other aid that will, together with
stronger trading relationships, provide the strongest possible
foundation for increased living standards and the creation of a
strong, global middle class by promoting growth with equity.
Fourth, we must be certain that what has already been
negotiated is functioning effectively. The importance of this
point cannot be overstated. The Uruguay Round Agreements
represent a balance of commitments by WTO Members. Failing to
enforce commitments made, or attempting to redefine what has
been agreed to through the dispute settlement process,
undermines confidence in the system, and will make negotiating
new agreements that much harder.
To conclude, we believe that most of our colleagues in the
House will agree that, on balance, the benefits of U.S.
participation in the WTO far outweigh the costs, and that the
organization has been a positive force in promoting and shaping
global trade. But we also hope that our colleagues will look at
consideration of this resolution as an opportunity to
acknowledge candidly and constructively the current
shortcomings of the WTO, and U.S. Trade policy, and to begin to
develop and implement recommendations for improving both.
Sander Levin.
Benjamin L. Cardin.
Robert T. Matsui.
John Lewis.
Richard E. Neal.
Xavier Becerra.
John Tanner.
C.B. Rangel.
Jim McDermott.
William J. Coyne.
William J. Jefferson.
Jerry Kleczka.
Michael R. McNulty.
Lloyd Doggett.
ADDITIONAL VIEWS OF REPRESENTATIVE BENJAMIN L. CARDIN
I fully concur with the views of my fellow Democrats
regarding the continued U.S. participation in the World Trade
Organization (WTO). In committee I voted against H.J. Res. 90,
which would have withdrawn Congressional approval of the WTO
Agreement.
I write separately to encourage Congress to consider a more
effective way to review WTO decisions that are adverse to the
economy of the United States.
In 1994 the United States Trade Representative (USTR) wrote
to then-Senator Bob Dole to endorse the establishment of a WTO
Dispute Settlement Review Commission. The Commission would
consist of five federal appellate judges, and would review all
final and adopted WTO dispute settlement reports. The
Commission, under the Dole proposal, would review adverse WTO
findings, using a set of four criteria, to determine whether
the WTO panel:
(1) demonstrably exceeded its authority or its terms of
reference;
(2) added to the obligations, or diminished the rights, of
the United States under the Uruguay Round;
(3) acted arbitrarily or capriciously, engaged in
misconduct, or demonstrably departed from established panel or
appellate procedure; and
(4) deviated from the applicable standard of review,
including in antidumping cases, set forth in the 1994 GATT
agreement.
The Commission would issue its determination within 120
days after the report is adopted. The Commission will play a
vital role in determining whether the WTO panel acted
improperly to the detriment of the United States.
Upon the issuance of any affirmative determination by the
Commission, any Member of each House would be able to introduce
a joint resolution calling on the President to negotiate new
dispute settlement rules that would address and correct the
problem identified by the Commission. The resolution would be
privileged and considered under expedited committee and floor
procedures.
If there are three affirmative determinations in any five-
year period, any Member of each House would be able to
introduce a joint resolution to disapprove U.S. participation
in the Uruguay Round agreements, again using expedited
procedures.
I am currently working with interested members of this
committee and consulting with the Administration on drafting
appropriate legislation, using the Dole proposal as the basic
framework. While we may disagree on the appropriate remedy for
responding to an adverse WTO panel decision, we all agree that
we must closely monitor WTO panel decisions that affect
American economic interests. The Review Commission would raise
the visibility of important WTO decisions that have a profound
effect on the economy of the United States. I hope that the
Commission would also reinvigorate the Congressional oversight
role regarding trade policy, and encourage members of Congress
to seriously reflect on WTO decisions and their impact on the
United States.
Ben Cardin.
ADDITIONAL VIEWS OF CONGRESSMAN PETE STARK
Although I oppose the resolution before us today, I do not
want my opposition to be interpreted as support for the World
Trade Organization (WTO). I have many concerns with the WTO and
the way in which the U.S. Trade Representative (USTR) measures
the benefits of U.S. membership in the Organization. The lack
of leadership from our Administration in the WTO has allowed
transnational organizations to dictate U.S. trade policy while
consumer protections, labor, environment and human rights have
not been considered relevant issues in the world body. The
Executive Branch has fought fervently for intellectual property
rights but lacks the same zeal when it comes to the survival of
the species. The World Trade Organization will make these
issues an integral part of the trade agenda when the world's
greatest trade advocate insists that these issues be of
paramount importance.
No one will dispute that trade increasingly involves broad
public policy matters, yet there are no representatives of
labor, environment, or human rights non-governmental
organizations on most WTO trade advisory committees. Industry
representatives are the sole members on the vast majority of
trade advisory committees and this is simply wrong. We cannot
expect to have the interests of labor, the environment and the
oppressed represented by those who are motivated by the bottom
line. Separating the environment and labor from other aspects
of trade by creating side committees such as the Labor Advisory
Committee or the Trade and Environment Policy Advisory
Committee has little effect of addressing the impact trade has
on these voiceless segments. These interests must be allowed
fair representation in all of the Industry Sector Advisory
Committees.
The WTO is a highly surreptitious club. Members of the
advisory committees have access to government information
concerning overall negotiating objectives and positions of the
U.S. that is not otherwise publicly available. The same
advisory committee members are able to relay their views
directly to government negotiators, giving the advisory
committee members an obvious advantage for influencing
positions. In addition, virtually all of the meetings are held
in closed session and records are not uniformly available to
the public. Freedom of information requests are often answered
with extensive withholdings. The U.S. was founded on democratic
and transparent principles. The WTO operates behind closed
doors without concern for the views of the American public.
USTR will only help their cause by spearheading efforts to shed
light on this esoteric organization.
Finally, the Administration must uphold domestic statute
when dealing with other WTO member nations. The U.S. Congress
executes the will of the American people through the various
laws enacted. These laws must be upheld within our sovereign
territory as well as in the global arena. On more than one
occasion, the Administration has pressured other countries not
to enact protections for the environment or public health. The
U.S. lobbied against Japan's consideration of new fuel economy
standards as well as Europe's proposals to protect children
from toxic toys. Again, the public was unaware that this was
taking place until after it had transpired. We must be
encouraging stronger standards from all of our trading
partners--even if that means regulating genetically modified
organisms here in the U.S.
If President Clinton is sincere in his pledge to put a
human face on trade, then the Administration should take my
views as first steps in improving trade for all consumers, all
workers and our global environment. These various interests
must be invited to the negotiating table to provide true
balance to the current bias in the WTO. The process must be de
transparent and open to all Americans. The U.S. must set the
standard for improving domestic and global conditions, not lead
in the race to the bottom for the sake of multinational profit.
Pete Stark.