Dorgan offers some clarity
May 12, 2007
Read fair trader Sen. Byron Dorgan's (D-N.D.) take on Thursday's foul fiesta, the deadly Bush embrace, the quixotic celebration... after the jump.
[Congressional Record: May 11, 2007 (Senate)]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]
Mr. DORGAN. Mr. President, this has been a very disappointing week from the standpoint of a discussion about international trade.
Yesterday morning, at about 8:30 in the morning, we learned the trade deficit for the previous month has once again spiked up to a $63.9 billion trade deficit in 1 month. And yet, most of this town continues to say how successful it is, this strategy of free trade.
This what has happened with our trade strategy. This chart represents an ocean of red ink. You can see, going back to 1995, we have had nothing but trouble, increasing deficits year after year. We are deep in debt with respect to our combined trade deficits. This is not a trade strategy that is working. At about the same time that I learned that our trade deficit spiked up once again to $63.9 billion in 1 month, I also learned that one of the largest employers in North Dakota, Imation, is leaving our State. They announced they are going to be closing their plant in Wahpeton, ND. They have actually announced it well ahead of time, and they are not going to be completely gone until the year 2009. It is helpful that we received some advanced notice. But this is a company that has 390 employees. It produces high-tech products in data storage and so on. Mr. President, 390 workers who are paid well, who have good jobs with good pay and good benefits, facing the prospect of all that disappearing.
I was on the phone yesterday with the CEO of this company, Imation, and asked questions. The company has said to its employees and to me that they are closing down this factory in North Dakota because it produces floppy disks, and that is yesterday's technology. Floppy disks are on the way out, not on the way in. The market has moved and that is just the fact. So supposedly that has required them to make a decision to close this plant.
Come to find out, though, that only 55 people in a plant of 390 people are making floppy disks. The rest of the employees, of course, are not. They are involved in the production of other things. So it doesn't really make sense that they are closing the plant because of floppy disks.
Yesterday, in a conversation with the president of the company, after a lot of probing, I found out that 168 of the jobs in this plant are in fact going to moved to Juarez, Mexico. Why? Undoubtedly because of low wages paid in Juarez, Mexico. You can produce things less expensively if you are paying people 50 cents an hour, I suppose. But at its root it is exactly what is wrong with what is happening in international trade and our participation in it.
Instead of lifting others up, our entire trade strategy has been a strategy that says it is all right to push the standards in this country down. No, the workers in Wahpeton can't compete with Mexican workers, nor should they be expected to. And by the way, I will bet some others of these jobs will be migrating to China and some other places in Asia.
I am not here to trash a corporation; that is not my point. This company has been a good employer in our State for a long time. But I am very disappointed and very troubled they have announced they are leaving. In the last 5 to 7 years we worked hard to get them Federal Government grants, almost $3 million in Federal grants, plus a guaranteed Federal loan to expand their plant in Wahpeton, ND. Then, just a few short years later, there is a U-turn in the corporate board room that says they have decided not only are they not going to want to proceed here, they are going to leave.
What about the millions of dollars of grants that we worked to get because we want to support those jobs? This, in a microcosm, is exactly what is going on all across this country. It is Wahpeton this week, but I could name almost any city and you will have the same thing. I have been on the floor of the Senate many times talking about who is leaving and when and where and why and how. Levis--gone. They don't make any Levis in America. There is not one pair of Levis made in America. Fruit of the Loom underwear--all gone; no underwear made in America by Fruit of the Loom. Fig Newton cookies, they, too, went to Mexico. If you want to eat Mexican food, buy Fig Newton cookies. Radio Flier, Little Red Wagon--gone to China; Huffy bicycles, gone to China.
I could go on forever talking about things. But what happened in Wahpeton, ND, brings it home in a stark way to the people who dressed up in the morning to go to work, appreciating those jobs, believing those jobs were important in their lives, just to find out that one day they are gone. And at least part of the reason they are gone is they can't compete with people who will work for a whole lot less money in other parts of the world. Should they be required to? Is our strategy to say, after we have built a set of standards for a century in this country, that those standards don't matter because you have to compete against a different standard? And the different standard is what they pay in China, what they pay in Mexico? We can't live on that in this country and that ought not be the standard.
I showed a chart with the red ink in terms of international trade deficits that we have. Our trade deficit last year was $832 billion. You can make a case with the budget deficit, where the Congress spends more than it takes in--you can make the case from an economics perspective that is money we owe to ourselves. You can't make that case with the trade deficit. That is money we owe to foreigners, and we are going to repay it someday with a lower standard of living in this country. That is a fact.
I wake up and read there is apparently some sort of fiesta at the White House. It is probably appropriately following the Cinco de Mayo period. They gathered together, Republicans and Democrats, and said: We have reached a deal on trade. So now we have a couple of trade agreements coming up--Peru, Panama, maybe also Colombia and Korea. And we have some folks who got together and said: We reached a deal on trade.
No one I know of in this Chamber has reached a deal on trade. I think there are plenty of voices in this Chamber that will rise in the coming week to say, no, the trade debate has to involve people in this Chamber who know that the current trade strategy doesn't work for this country. It is not because we don't want to be engaged in trade. We believe in trade, and plenty of it. We support international trade. But we support international trade that is mutually beneficial to us and others. What has happened in recent trade agreements? I come back now to the issue of Mexico. We do a trade agreement with Mexico, and you turn a $2 billion surplus into an annualized trade deficit now with Mexico--in the first 3 months of this year it is going to be $70 billion a year, with Mexico. Think of that. We turned a trade surplus with Mexico, a $2 billion surplus, into a $70 billion deficit. You talk about incompetence? You talk about bad trade deals? This is the cherry on top of the sundae in bad trade deals.
Among the things they discussed yesterday is Korea. They made brief mention of that today in the paper. You have a couple of problems with Korea, aside from the fact that the agreement was generally negotiated incompetently.
Here is an example of what is wrong with Korea. Mr. President, 99 percent of the automobiles in Korea driven on the streets are made in Korea. Is that an accident? Why is that the case? Because that is the way Korea wants it. They don't want imported vehicles. They want the people of Korea to buy Koreans cars that produce Koreans jobs in the manufacturing marketplace.
Here is what has happened with Korea. Last year we sent Korea 4,200 American cars. That is our export market to Korea. Last year, Korea sent us 730,000 Korean cars to be sold in our marketplace. So Korea said: Load all these cars on ships, send them to America, sell them to American consumers and, by the way, while we send you 730,000 Korean cars, we will limit you to 4,200 American cars coming our way. You say maybe there is not a market for American cars in Korea. Talk to the folks who try to sell Dodge Dakota pickups and learn that story, and then you will learn what happens with respect to American vehicles that are attempted to be sold in Korea.
Now, in the discussion this morning, I read of the celebration at the White House by Members of the House and the White House, making some sort of deal with respect to Panama, Peru, Colombia, I guess. They talked about labor standards, which I think is very important. In fact, the only trade agreement that has ever had labor standards is the Jordan agreement. The Clinton administration agreed that the free-trade agreement with Jordan would have labor standards.
Well, guess what. Last year there were findings of sweatshops operating underneath the umbrella of a free-trade agreement with supposedly strong labor standards is in Jordan. Laborers were brought over from Bangladesh to sweatshops in Jordan, to turn Chinese materials into garments for sale in the U.S. market. The workers were forced to endure 20-hour days; yes, 20-hour days in sweatshop conditions in a country with whom we have a trade agreement where there are labor standards. These standards mean virtually nothing unless you have enforcement. All of these are just words unless you have enforcement. And this Administration has certainly demonstrated that it has no interest in enforcing labor standards.
The Government of Jordan has taken some steps to try to fix some of these problems. Is that because our U.S. trade officials tried to enforce the labor provisions in the trade agreement? No. It's because a labor rights group called the National Labor Committee exposed these problems, and because the New York Times wrote a front page story about them. So it's not the labor standards in the trade agreement that got the Jordan government to start to do the right thing, because this Administration never tried to enforce those standards. It was the fact that these abuses were independently exposed and held to the light. These failed trade policies are undermining our country. This is pulling the rug out from under our country.
But this is kind of a Rip Van Winkle moment again. We have an announcement of surging trade deficits, and the Congress just sleeps through it, the White House sleeps through it. Instead of deciding there is a crisis we ought to deal with, we now see a bunch of people going to the White House and embracing, saying: We have got a new agreement between House leaders and the President with respect to how we are going to proceed on certain trade agreements.
Well, let me say to them there is another voice in this Congress, a voice that will come from the Senate. There are some of us that will insist we stand up for the economic interests of this country. I am not suggesting we are against trade. That is not the case. But we will insist there will be a new day in trade agreements that stand up for our economic interests. That has not been the case to date.
Now, let met finish by going back to the issue of what has happened this week in Wahpeton, ND.
Those workers in Wahpeton, ND, appreciated those jobs; good jobs that paid well with good benefits. I appreciated the company that was there that made those jobs possible. But I do not appreciate the circumstance where we are told one day: It is over. Just a few years after we worked to get substantial Federal grants and guaranteed Federal loans to expand the manufacturing plant, the very plant we are now told is obsolete, or at least the very plant we are now told houses the production that will be moved elsewhere; production that will be moved to Mexico because of lower labor costs. We did not strive for a century to raise standards in this country just to find them undermined day after day, by 30-cent or 20-cent-an-hour labor in China, or 50-cent-an-hour labor in Mexico. That is not the right approach. It is not an approach that strengthens, it is an approach that weakens our country.
We expanded the middle class in this country over a century by lifting people up. I will not go into great detail about it, but I have told this story 100 times about James Fyler, who died of lead poisoning. He was shot 54 times. That is lead poisoning, I guess. He was shot 54 times. The reason he was shot was because in the early part of the last century, he insisted that people who went into a coal mine to work ought to be able to be paid a fair wage and expected to be working in a safe coal mine; for that he was killed.
Over a century, so many men and women worked to raise standards, to say: People ought to have the right to organize, they ought to have the right to a minimum wage, a safe workplace. Over a century we lifted those standards. It did something important to expand the middle class of this country. But this is being undermined by the massive trade deficits we are running, the $836 billion annual deficit we had in 2006, and the nearly $64 billion trade deficit we ran in March 2007.
I hope one day there will be enough of us in the Congress who will say: Stop. Enough. We are not going to put up with it. We are going to insist and demand that our trade agreements represent the best economic interests of our country. Yes, we want to help others. But most importantly, we want to preserve a standard of living in this country that gives us opportunity for the future.
Let me end by saying, again, I believe in trade. I believe in plenty of trade. I believe we can compete and compete successfully, but the rules have to be fair, and those who negotiate trade agreements have to do so with one eye on how it is going to affect this country. Regrettably, most of the trade negotiations in the last two and a half decades have been incompetent and I think have pulled the rug out from under America's workers and dumbed down the standards that many have given their lives to create in this country.
I yield the floor and suggest the absence of a quorum.
I just realized Fig Newtons were made in Mexico now. How disappointing. Even more disappointing is Kraft Foods commercial for them.. showing the fig newtons going back to an obviously American farm, as though that is where they came from. If it was Truth-In-Advertising, we'd see the Fig Newtons crossing the border from Mexico to get onto that American's farm. You know, the farm that used to produce the food before it Kraft outsourced them to Mexico.
Posted by: Diana | May 22, 2007 at 04:03 PM