Russia-Moldova PNTR

Floor Speech

By:  John Kerry
Date: Dec. 5, 2012
Location: Washington, DC

Mr. KERRY. Mr. President, the chairman of the Finance Committee, Senator Baucus, is tied up right now with a scheduling conflict, working on the fiscal cliff issue, so he asked me if I would kick off the debate with respect to the Russia PNTR, H.R. 6156, the Russia and Moldova Jackson-Vanik Repeal and Sergei Magnitsky Rule of Law Accountability Act of 2012.

I am very happy to do this on behalf of Senator Baucus. We share a great partnership together as chairman of our two committees focused on trade and on the relationship with Russia, both of which come together in the legislation today.

I would be remiss, however, if I didn't say a word about what consumed us yesterday with the vote on the disabilities treaty. It is certainly a moment that stands out in my memories of my time in the Senate. I can't think of any other time when a former majority leader has come to the floor--a veteran--who sought to have his colleagues join together in supporting something that would improve the lives of people with disabilities.

I am not going to go back and reargue it now. That would be fruitless and I think not helpful to where we want to move to. What we want to move to is a place where we can pass this. I can say--I believe this--I can say to Senator Robert Dole that we will pass the disabilities treaty and we will pass it, I believe, early next year. I base that on the fact that some Senators had difficulties with the fact that we are in a lameduck session and they had signed a letter which, regrettably, some of them didn't digest completely but nevertheless signed, saying they wouldn't take up a treaty in a lameduck session and I think some felt compelled by that and others felt compelled by other things.

But here is what I think we can do. Starting next year, I believe we can move to additional hearings that can make crystal clear to all colleagues the state, as it may not have been yesterday in some cases, with respect to both the law and the facts as it applies to persons with disabilities. I pledge now to make certain that within the resolution of advice and consent, any concern that was not adequately addressed--I personally believe they were addressed--it is possible we can find the language that will address the concerns of any Senator who yesterday felt--whether it was the United Nations or homeschooling, I believe those things can be adequately addressed. I do know a number of Senators said they would be prepared to vote for it after we are out of the lameduck session, and I am confident we will pass the disabilities treaty in a different atmosphere and in a different time.

One of the things I learned from my senior colleague Ted Kennedy, who did this for so many years, is that perseverance pays off when the issue is worth fighting for and we always have another day and another vote in the Senate. That always affords us the opportunity to make things right. We are certainly going to try and do that.

This PNTR-Magnitsky bill is, in fact, one of those opportunities where we can start to put the Senate on the right track, and I think all of us look forward to the chance to be able to do that.

This bill passed the House of Representatives by a huge margin of 365 to 43. What it would do is establish permanent normal trade relations for Russia, and it would require the identification and imposition of sanctions on individuals who are responsible for the detention, abuse and death of Sergei Magnitsky and other gross violations of human rights.

Let me make my best argument, if I can, in favor of the bill, and then I wish to turn the discussion over to the ranking member, Senator Hatch, to present his case for passage. After that, the Presiding Officer of the Senate at this moment, the Senator from Maryland, Mr. Cardin, will lead a discussion of the provisions of the act related to honoring the memory of Sergei Magnitsky and combating the types of human rights abuses that led to his premature and tragic death. I wish to congratulate the Presiding Officer and salute him for his significant efforts. He has been dogged, and that component of this legislation would not be here today if it weren't for the efforts of the Senator from Maryland. Chairman Baucus will then have been able to return to manage the rest of the consideration on the floor at that time.

As the Presiding Officer knows, Chairman Baucus and I lead the two Senate committees that are charged with overseeing the twin pillars of America's unique role in the world. Our commitment to open, transparent and free markets and our commitment to democracy and open discourse is a force for international peace. We believe our global economic interests and our foreign policy values are closely tied together. They should be closely tied together. That is why we urge our colleagues to seize this opportunity that Russia's accession to the World Trade Organization presents for both job creation and our ability to bind Russia to a rule-based system of trade and dispute resolution.

Granting Russia permanent normal trade relations is as much in our interests as it is in theirs. Frankly, that is what ought to guide the choices we make in the Senate. The upside of this policy is clear on an international landscape. It is one that rarely offers this kind of what I would call, frankly, a kind of one-sided trade deal--one that promises billions of dollars in new U.S. exports and thousands of new jobs in America. That is certainly in our interests.

Today, Russia is the world's seventh largest economy. Having officially joined the WTO on August 22, Russia is now required by its membership in the WTO to lower tariffs and open to new imports. That sudden jump in market access is, frankly, important to any country that is the first country through the door, and if we don't pass this trade legislation, we will not be among those countries.

I can tell my colleagues Massachusetts, speaking for my State, welcomes access to the Russian market, and we want that access to be played out on a level playing field. The State of Massachusetts exported $120 million worth of goods to Russia last year, and those exports obviously support hundreds of jobs. But if we don't pass this bill, those exports will face competition from other countries that will not pay the same high-level tariff we currently pay.

Let's take one specific example. Massachusetts exported $18.5 million in medical equipment to Russia in 2011, but we face strong competition from China, which has increased its share of the Russian market in each of the last 10 years. We don't shy away from strong competition, but we want that competition to be able to be played out on an even playing field. As long as we don't have normal permanent trade relations with Russia, we are disadvantaging ourselves. It simply doesn't make sense. Since joining the WTO, Russia agreed to reduce average tariffs on medical equipment to 4.3 percent and to cut its top tariffs from 15 percent down to 7 percent. As it stands now, that is a benefit China will get and we will not. It simply doesn't make sense to anybody.

To grant Russia PNTR status requires us to repeal the 1974 Jackson-Vanik amendment. A lot of our staff members, I hasten to say, were not even born back when Jackson-Vanik was put in place. Many of our colleagues and a lot of our staff have studied the Soviet Union but have never experienced that period of time. What we are living with is a complete and total relic of a bygone era.

Congress passed Jackson-Vanik during the Cold War to pressure the Soviet Union to allow Russian Jews to be able to emigrate freely. It was very successful. It worked, and as a result, the Kremlin worked with us and others to help Jews be able to emigrate. As a result, every single U.S. President has, regardless of political party, waived Jackson-Vanik's requirements for Russia since 1994. The American-Israel Public Affairs Committee, the National Conference on Soviet Jewry, and the Government of Israel now all support the repeal of Jackson-Vanik for Russia. With too many Americans still searching for jobs all across our country, our manufacturing sector needs every boost it can get. We cannot afford to retain Jackson-Vanik any longer. This is in America's interest. Despite progress, our trade deficit remains too wide, and I think that seizing this opportunity to increase exports to Russia is one very obvious way to be able to make concrete progress in reducing that trade deficit.

U.S. exports to Russia total more than $9 billion a year. Establishing PNTR for Russia could double that number in just 5 years, according to one recent study. That could mean thousands of new jobs across every sector of our economy. With the Russian economy's impressive growth, it is actually--Russia is expected to outgrow Germany by about 2029, so it is steadily growing in the world marketplace. The long-run gains for everybody would be even greater.

None of us is going to suggest that every issue with respect to Russia has been resolved. We know there are still points of tension, and some of them in the foreign policy area are very relevant today, for instance, over Syria. We understand that. We hope recent events in Syria may be moving Russia and the United States closer in terms of our thinking. But it is only a good thing to bring Russia into a rules-based system with mechanisms for peaceful, transparent dispute resolution.

There is no debate--and I think the Presiding Officer knows this full well--that the very tragic and senseless death of anticorruption lawyer Sergei Magnitsky, who died while in Russian custody--is simply unacceptable. It is appalling, and it highlights a human rights problem that has grown in its scope, not diminished. It is one we hope to be able to resolve with good relationships and good discussions.

Senator Cardin, the sponsor of that legislation in the House and in the Senate, is going to speak shortly about it, and I will leave him to describe in full the nature of that particular component of this bill. But suffice it to say that human rights, democracy, and transparency activists in Russia favor the passage of constructive human rights legislation in our Congress, and they also see WTO membership and increased trade for the United States as an avenue toward progress. So there is no contradiction in what is happening. They understand, as we all should, that repealing Jackson-Vanik is not a blanket acceptance of any particular policy or approach in Russia. It is certainly not an acceptance of what happened with respect to Sergei Magnitsky and that is because of the Magnitsky legislation.

Repealing the bill--repealing Jackson-Vanik--is not an economic giveaway to Russia. To the contrary, it represents, as I have described, an enormous opportunity for the United States to compete on a fair playing field with other countries and to create more jobs in the United States. By establishing PNTR with Russia, U.S. businesses will win increased market access without giving up anything in return. There would be no tariff changes, no market concessions, nothing. It, frankly, diminishes the willingness of some hard-liners in Russia to distort the current dialog and to distort the possibilities of a better relationship, which we want with Russia. By taking this away, we will reduce the abuse of Jackson-Vanik as a rhetorical tool to rally anti-American sentiment in Russia. I believe we can do something very important here today and both our economy and our foreign policy will be better for the effort.

I yield the floor.

BREAK IN TRANSCRIPT