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Rep. Rangel Likens Last Minute Secret Letter to a "Deal With the Devil"

STATEMENT FROM REPRESENTATIVE CHARLES B. RANGEL Ranking Democrat, Committee on Ways and Means

According to press reports, the final votes to pass the Thomas Fast Track trade authority bill came only because the Republican leadership of the House - Speaker Dennis Hastert, Majority Leader Richard Armey, and Majority Whip Tom DeLay - signed a letter promising to "use whatever means necessary" to undo major provisions of the bipartisan Trade and Development Act enacted last year to open up trade with the nations of the Caribbean Basin and sub-Saharan Africa.

I hope these reports are mistaken. How could people like Hastert, Armey and Delay who claim to be free-traders sacrifice a vital provision of U.S. trade policy in order to gain a one-vote victory on a partisan Fast Track bill that still must pass the Senate? If this is true, it is wrong-headed and borders on being immoral.

Even last night when I said that the era of bipartisanship on trade was over, I did not realize the extent to which the House Republicans were willing to tear down commitments that have taken years to build. The Trade and Development Act was a truly bipartisan act. Democrats such as myself, Rep. Sander Levin, Bill Jefferson, Jim McDermott, and Donald Payne worked with Speakers Gingrich and Hastert, Bill Archer, Phil Crane, Ed Royce, Bill Roth and Trent Lott.

Apparently, the letter also commits to a substantial reduction in trade benefits for Andean nations that had already been agreed to by House leaders. These nations have committed to the U.S. that they will help fight illegal narcotics trade. This letter sends a message to them that the House Republican leadership is not willing to keep the U.S. side of the bargain.

This letter is a betrayal of all the reasons we have trade. It comes at the expense of hundreds of thousands of Caribbean workers as well as their governments who trusted that when the United States gives its word in trade matters, that word means something. This secret deal welches on a U.S. commitment to the people of the United States and the people of the Caribbean nations.

Trade agreements that may be brought to the Congress under the partisan Fast Track that bill barely passed yesterday will take years to negotiate, and yet the Republican leadership pledged to sacrifice a currently operating trade relationship that was enacted with vast bipartisan support. This is blatant protectionism in the name of free trade and the expense of the Caribbean nations.

The United States will have no credibility in international trade negotiations if we show the world that, in order to get a partisan trade bill, we are willing to undo existing trade commitments. That's like the Republican leaders trying to save your soul by signing a deal with the devil.

The Senate Leaders will know that this bill passed only because of such last minute secret deals. They will know the House leaders have shown they are hypocrites on free trade. This fight has just begun.

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Los Angeles Times via Dow Jones

Publication Date: Friday December 7, 2001 Page A-43 Los Angeles Times (Home Edition)
Copyright 2001 / The Times Mirror Company By WARREN VIETH TIMES STAFF WRITER

WASHINGTON -- He based his public appeals on far grander themes, but President Bush stitched together his one-vote majority on a major trade measure with cotton thread from the Carolinas.

The House voted, 215 to 214, to expand Bush's authority to negotiate trade deals after hearing repeated exhortations about the need to preserve America's international prestige and economic prowess.

But that's not what put "fast track" over the top. To get the final few votes they needed to prevail, the White House and its congressional allies had to cut a deal with Rep. James DeMint (R-S.C.).

"They were four votes short. The time had expired. They were looking everywhere for votes, and they couldn't get them. So they came to me," DeMint said.

He got what he wanted: a signed letter promising congressional action to make sure that apparel assembled in Caribbean Basin countries is made from fabric dyed, printed or finished in the United States to qualify for duty-free, quota-free treatment.

It was one of several side deals negotiated in the final hours to win over small, but crucial, blocs of votes.

Others involved promises to shelter Florida citrus growers and Pennsylvania steel producers from some of the creative destruction wrought by international trade.

Although critics accused the administration of abandoning its principles, and the swing voters of selling out, some trade advocates insisted that Bush got the better end of the bargain.

"It's literally like on the battlefield: You do what you have to do," said Gary Clyde Hufbauer, senior fellow at the Institute for International Economics and a former U.S. trade official. "It was absolutely a necessary cost, whatever he gave."

A negative vote, Hufbauer said, "would have been a shot heard around the world against globalization."

If so, the last-minute deal with DeMint may have kept globalization on track.

DeMint is a key member of the Textile Caucus--lawmakers whose districts contain textile plants in the Carolinas, Georgia and Tennessee.

The labor-intensive industry has been hard hit by foreign competition.

U.S. imports of textiles and apparel soared from $8.6 billion in 1980 to $77.5 billion last year, after adjusting for inflation. Employment fell from 2.1 million to 1.2 million over the same 20-year period. According to the American Textile Manufacturers Institute, textile makers lost $369 million last year and shut down more than 100 mills.

Several members of the Textile Caucus told the White House that they would vote against fast track, officially known as trade promotion authority, unless it made several commitments to help the ailing industry.

The administration went along with some of the proposals. But the two sides were still far apart on the seemingly arcane, but ultimately critical, "dyeing-and-finishing" dispute.

Under the Caribbean Basin Trade Preference Act, which took effect in October 2000, countries like the Dominican Republic and Honduras can avoid U.S. quotas and tariffs on shirts, trousers and other apparel if they assemble them from fabric made in the United States.

But it was unclear whether the law allowed them to buy unfinished cloth from U.S. mills and then dye, print and finish it themselves. The Customs Service ruled that the Caribbean countries could do their own dyeing and finishing. Caucus members wanted to overturn that ruling and keep the finishing work in the United States. Thousands of jobs were at stake, they said.

At one point, Ways and Means Chairman William M. Thomas (R-Bakersfield) proposed a compromise: Woven apparel, such as denim jeans and dress shirts, would have to use U.S.-finished fabric, but knit apparel, such as T-shirts and polo shirts, would not. The proposal was backed by U.S. clothing retailers and some importers but opposed by textile makers. The Textile Caucus said no deal.

Going into Thursday's vote, the administration wouldn't budge. So DeMint took his place on the floor, prepared to vote against the legislation. But he carried in his pocket the draft of the letter that would commit the administration to the change that the caucus was seeking.

It was legislative brinkmanship, and it worked.

"I had the letter with me on the floor," DeMint said in an interview shortly after the vote. "Chairman Thomas had said he would not agree to this. But the leaders of the House said they would. They signed it. I changed my vote. I went and got a few other textile folks who were going the other way and got them to vote for it. We passed it."

DeMint said he considers the outcome a win for both sides. The caucus got several big concessions for their besieged industry, and Bush got the trade promotion authority he was seeking.

"It was key to me," he said. "I wanted to support the president and TPA, but I wasn't going to do it without this."


Copyright (c) 2001 Times Mirror Company
received by NewsEdge Insight: 12/07/2001 05:11:03

Timothy M. Reif
Democratic Chief Trade Counsel
Committee on Ways and Means