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

Hearing on Summit of the Americas and Prospects for Free Trade in the Hemisphere

May 8, 2001

It will not help to mis-describe or misunderstand the record of the last Administration. In the last session there was forward motion. The Clinton Administration and the Congress, working on a truly bi-partisan basis, acted on China PNTR, and Africa/C.B.I., breaking the five-year deadlock on trade legislation. The Administration also negotiated new trade agreements with Jordan and Vietnam.

It also will not help to frame the issues of 2001 in terms of old labels or old battles. There was movement during the last few years in good measure because there was a recognition that the nature of trade has been changing - both in its size and its contents. As developing nations with different economic structures from our own and other industrialized nations have become an increasing part of global trade, new issues have arisen.

The effort to address these new issues is not "a new kind of protectionism." Such labeling is mistaken and counterproductive, setting up a polarization that only helps to derail the trade agenda.

No one can turn back the clock on globalization; on the other hand, it is a mistake to believe that one cannot or should not shape its course. Shaping globalization requires a forthright effort to address the issues of labor and environmental standards because of their very relevance to international economic competition.

The nexus between trade and labor is reflected in a recent New York Times article, "Labor Standards Clash with Global Reality," where an executive of an American company stated, regarding its practices on labor standards, "We can't be the whole solution...The solution has to be labor laws that are adequate, respected and enforced." And, in the same article, the statement by the President of El Salvador describing the variation of government enforcement of core labor standards, "The difficulty in this region is that there is labor that is more competitively priced than El Salvador." It is also reflected, whether one agrees with the decision or not, in the rationale stated by the Bush Administration when it withdrew from the Kyoto Treaty on Global Warming, "It exempts the developing nations around the world and it is not in the United States' economic best interest."

It will not be helpful to try to finesse these issues. They are not entirely new; we have had some previous experience. For example, labor standards have long been part of our GSP system where there has been a full array of enforcement mechanisms available to us and they have been used responsibly. The same is true of the labor provisions in the Cambodia textile and apparel agreement.

It is time to build on these experiences and move ahead, not be stuck in past polarizations.

I have urged we should move on Jordan, as negotiated. We should move on Vietnam, doing so in a way that recognizes the need to further address labor standard issues as we negotiate a textile and apparel agreement with Vietnam. The steel crisis needs to be addressed resolutely.

Doing so in a collaborative and bipartisan fashion will help to build the experience and confidence necessary to work effectively on FTAA and the Andean Trade Preference Act and on the significant "transfer of power" from Congress to the Executive branch embodied in Fast Track trade negotiating authority.

Congress has taken this step only twice before in our history. On both those occasions -- in 1974 and 1988 -- the laws contained three critical components: (1) negotiating objectives and related legal mandates to the executive; (2) mechanisms for congressional involvement in - and public input into - the negotiating process; and (3) commitment to an up or down vote on the final package. It ignores history to say that Congress can "recapture" its grant simply through the implementation legislation.

So, how do we move forward to design the three components? I believe we need to start getting into this in detail. On the first component -- negotiating objectives -- we need to get beyond general concepts. For example, one issue is whether we are going to establish separate negotiating priorities for multilateral, regional and bilateral agreements. I believe that makes sense. Another issue - going beyond the general concepts of "one size does not fit all" - is to develop language that ensures that dispute settlement remedies are designed to be demonstrably effective in a variety of contexts and that dispute settlement procedures are more open and inclusive in all contexts.

Turning to the second component - updating the partnership between Congress and the executive - we are going to have to decide what procedural mechanisms are needed to ensure effective Congressional oversight of and public input into each step of the process. For example, how many and what kinds of congressional checkpoints should we build into the process - for instance, should there be a congressional or committee vote at the beginning and a midpoint in each negotiation? What additional mechanisms should we create and how exactly should they work - for example, providing for meaningful labor standard and environmental reviews, updating the advisory committee system for business, labor, environmental and other groups. There is a close relationship between negotiating objectives and procedural mechanisms.

A right fast track approach requires that we move beyond slogans and sound bites, embrace all of issues of trade, old and new, and strive to shape globalization with rules of competition that promote U.S. economic interests and raise living standards around the world.