A policy that goes on the offense for U.S. businesses and workers

The U.S. trade deficit was $711.6 billion in 2007 — among the highest in history and a full 5 percent of the U.S. economy. This deficit is a drag on economic growth and on job creation at a time when our nation can afford neither.

The Bush administration’s hands-off approach to trade enforcement is a significant part of the problem. They have failed to knock down barriers in foreign markets, failed to address trade agreement violations, failed to provide relief to U.S. businesses harmed by unfair trade practices, and have allowed the World Trade Organization to undermine U.S. trade law.

Trade enforcement is not defense — it is offense: standing up for U.S. businesses and workers in the global market place. It is not “protectionism”; indeed, it is an antidote. John Meier, an executive with Libbey Glass Inc., told the Ways and Means Committee what his company faces:

“Effectively, many of us would tell you we have an eight-lane highway coming into Peoria, only to face a dirt road back to Rio, Jakarta, or Istanbul. … Support for further trade liberalization understandably weakens in light of continued foreign unfair trade practices and inadequate enforcement of our laws.”

There has been much misguided discussion about U.S. trade policy and the Clinton legacy. It is the Bush administration that has turned its back on progress made under President Clinton in the areas of enforcement as well as in shaping the terms of trade agreements.

Take, for example, the WTO where we should be insisting each and every day that our trading partners play by the same internationally negotiated rules as we do. Under the Clinton administration, from 1992 through 2000, the United States filed an average of 11 WTO cases per year to pry open foreign markets for U.S. exporters of goods and services. From 2001 to now, the United States has filed an average of just three cases per year.

Take, for example, the safeguard mechanism (Section 421) to address surges in Chinese imports that the Clinton administration negotiated for when China entered the WTO. This mechanism allows the independent U.S. International Trade Commission (ITC) to determine if imports from China are causing material injury to U.S. industry and, if so, to allow the president to provide temporary relief. In four cases, the ITC determined that the WTO requirements for relief had been satisfied. Nevertheless, in all four cases, the president refused to provide relief. Without question, plants have closed and jobs have been lost as a result. U.S. producers have since given up on obtaining relief under Section 421: Not a single 421 case has been filed since 2005.

Take, for example, Super 301, a provision first signed into law by President Reagan to help open foreign markets to U.S. goods and services. Super 301 required the U.S. Trade Representative (USTR) to identify and take concrete action to eliminate market-access barriers blocking U.S. exports. The Bush administration allowed it to expire in 2001.

The Ways and Means Committee will consider legislation in the weeks to come that seeks to reactivate the enforcement agenda. We are continuing to take action to implement a new Democratic Trade Policy that expands markets, shapes the terms of competition, and uses U.S. law and international agreements to ensure that trade violations are addressed. It is only through this activist agenda that we can have the two-way trade that expands markets and shapes globalization.

We should reinstate Super 301 to create a more level global playing field. We should also create an independent office reporting directly to Congress that would investigate violations of U.S. trade agreements, issue indictments, and recommend that the administration file cases in the WTO and under U.S. free trade agreements.

We should ensure that countervailing duty laws apply to subsidized imports from non-market economy countries, provide guidance to Commerce as to how to apply the countervailing duty law and give Congress a role to play in determining whether a country is no longer a “nonmarket economy.”

We must also support longstanding U.S. trade laws that are under attack in litigation at the WTO. The WTO Appellate Body recently ruled that the methodology the United States has used to identify and measure dumping for the past 87 years must be scrapped — even though international negotiations many years ago rejected that result. But Appellate Body rulings that the USTR called “devoid of legal merit” cannot be permitted to stand. They will only undermine the credibility of the multilateral trading system and will have a chilling effect on further international negotiations.

We also must do more to stop counterfeit and pirated imports from entering the United States. Violations of international property rights (IPR) rules cost our country $250 billion per year. Organizational changes within the Customs Service are necessary, as well as enhancement of the authority Customs has to impose and collect penalties for IPR violations.

Like pirated goods, products hazardous to consumers are also entering the United States.  Last year we saw a multitude of product recalls involving a wide range of imported products, from dangerous toys and baby rattles to tainted toothpastes and medicines. Customs and Border Protection (CBP) must be provided with tools that better enable them to target high-risk shipments. We must also require CBP to develop a government-private sector import safety partnership program to ensure that imports meet U.S. health and safety standards, and ban imports from repeat offenders.

Too often the public gets caricatured as being against trade. I think they are much smarter than that and they sense that something is out of whack with our current approach to trade and international competition. What they are against is the feeling that U.S. businesses and workers are too often being taken to the cleaners and that no one is out there fighting for them. We intend to change that.

Levin is a member of the House Ways and Means Committee.