Committee on Ways and Means, Subcommittee on Trade, 3-29-01 Testimony

Opening Statement of the Hon. Sander M. Levin, M.C., Michigan

Hearing on Free Trade Deals: Is the United States Losing Ground
as its Trading Partners Move Ahead?

March 29, 2001

The issue is not whether there should be an expansion of world trade. The question is how that expansion occurs. Globalization is here to stay. The question is whether and how it should be shaped.

That involves examining the role of bilateral, regional, and multilateral agreements.

That includes an examination of the increasing number of free trade agreements, as we are doing today. This is necessary before we rush to conclusions as to the interaction between bilateral, regional, and multilateral agreements, and the actual impact of any of these types of agreements on the U.S. economy.

In this examination, we need to look not only at the number of agreements, but beyond sheer numbers to their contents, including the level and actual scope of trade covered by the agreements.

I think we will find that many of these free trade agreements are much less comprehensive than agreements such as the NAFTA. Indeed, some may be vulnerable to challenge under Article XXIV of the GATT and similar WTO rules. We should give serious consideration to bringing challenges in appropriate cases.

When it comes to the question of how to shape expanded trade as we enter into more trade agreements of our own, it is vital that we take account of the evolving nature and new issues of trade. Trade policy is no longer just about tariffs and the more glaring non-tariff barriers. It is also about labor standards, environmental regulations, health regulations--among other issues--and the impact these have on the terms of competition. These issues should be included in fast track and in the agreements negotiated pursuant to fast track.

Finally, as I have said before, the best way to move ahead with agreements on expanded trade is to proceed step by step.

The first step seems clear. There is a free trade agreement that was negotiated and signed last year and transmitted to Congress at the beginning of this session.

I am referring, of course, to the U.S.-Jordan Free Trade Agreement. Legislation to implement that agreement was introduced in the Senate yesterday and will be introduced in the House in the coming days and should be acted upon expeditiously.

With the King of Jordan visiting the United States next week, the time is now to send a clear message that we intend to make the U.S.-Jordan Free Trade Agreement operational as quickly as possible.