Ensuring Tax Exempt Organizations the Right to Appeal Act--Motion to Proceed

Floor Speech

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Ms. STABENOW. Mr. President, I rise today to talk about an issue that, by some estimates, has cost the United States as many as 5 million jobs, which is a lot of jobs, and that is the issue of currency manipulation.

We are going to have an opportunity, now that there is an agreement, to move forward on all of the issues related to trade, whether it is fast-track or helping workers or enforcement issues or the other pieces that will be in front of us. We will have an important opportunity to seriously move forward in a positive way for our manufacturers and for agriculture and for all those who are impacted by currency manipulation.

In fact, currency manipulation is the most significant 21st-century trade barrier that American businesses and workers face today and is the least enforced against. We take the least amount of action against currency manipulation, and yet it is the most significant 21st-century trade barrier. If we don't take meaningful action to address this issue, we stand to lose even more jobs at a time when our economy is desperately trying to recover.

Our workers are the best in the world, and we can compete with anybody--our businesses can compete with anybody as long as there is a level playing field and the rules are enforced. But we can't win when our trading partners cheat, and that is what is happening right now. When they manipulate their currency--when Japan does it, when China does it, when other countries do it--they are cheating.

A strong U.S. dollar against a weak foreign currency, particularly one that is artificially weak due to government manipulation, means foreign products are cheaper here and U.S. products are more expensive there. For example, one U.S. automaker estimates that the weak yen gives Japanese competitors anywhere from a $6,000 to $11,000 advantage on the price of a car, depending on the make and model. It is hard for our American carmakers to compete when they are effectively seeing a $6,000 to $11,000 higher sticker price--more expensive than Japanese vehicles not because of any other difference at all, just currency manipulation. That is a large difference that is based on currency manipulation. In fact, we have seen some numbers that--at some points in time, the entire profit on a vehicle will be from currency manipulation.

We keep hearing about opening Japan's markets to U.S. automakers. While that is fine and that sounds nice, it is really a red herring when we look at what is going on because Japan right now has zero percent tariffs on U.S. cars. So it is not the tariffs that are keeping out our cars; it is the complicated web of nontariff barriers that Japan uses to keep out American automobiles.

Beyond that, what is significant and what we have learned is there is little appetite for American cars in Japan.

Last year, Ford's share of imports in Japan was 1.5 percent. Chevy was less than one-third of 1 percent. There were 13 times as many Rolls Royces imported into Japan last year than Buicks, but that is not because there were all kinds of Rolls Royces going into Japan. It is because there were only 11 Buicks, not 1,100, not 11,000--11.

One of the things that is interesting is that in Japan they buy Japanese vehicles. I wish in America we bought American-made vehicles. We would not be seeing as much of this challenge. It is a different culture there in terms of the pride of buying Japanese vehicles and, in fact, doing what they can to keep others out through nontariff trade barriers. Taking down the trade barriers is a good thing. I support it, but it is not enough. That is not what this is about when we are talking about the transpacific trade agreement and the worries of American automakers and other manufacturers as we do that. That is not the big challenge. It is not about just trade barriers, making life easier for the handful of Japanese consumers who are looking to buy an automobile from outside their country. Our manufacturers tell us that is not the main concern. It is not about competing in the United States or Japan; it is about competing everywhere else in the world. That is the problem.

Japan has a population of 120 million people, but Brazil has a population of 200 million people. India has a population of 1.2 billion people. In emerging markets, American-made vehicles are at a severe competitive disadvantage compared to vehicles produced in Japan or Korea, when those countries choose to manipulate their currency, which has happened many, many times.

We are competing, Japan is competing, and the United States is competing for those 1.2 billion customers. If they can artificially bring down their price $6,000, $7,000, $10,000 or more to sell into those areas, even though it is illegal in terms of the international community--they have signed up saying they will not do it. But if they are allowed to do it and if our trade agreements allow them to do it, it is not fair.

Why would we do that to American companies? Why would we do that to American workers? Why would we allow that kind of cheating to occur? That is what the amendment that Senator Portman and I have is all about, that we will be offering and asking support for.

This is not an issue that only impacts the auto industry or other manufacturers. As everyone knows, I care deeply about agriculture, as the current ranking member and former chair of the agriculture committee. Agriculture is impacted by currency manipulation as well. As a competitive sector in the global economy, any practice that distorts the economy, disrupts trade, and threatens employment has an impact on U.S. farmers and ranchers as well.

Unfortunately, the language currently included in the TPA bill does not adequately address these issues, because if we are going to be effective around currency provisions, we have to make sure they are enforceable. There is some language there, but unlike other parts of the TPA, there is not language requiring that any provisions in a trade agreement be enforceable. That is why Senator Portman and I have introduced an amendment to this bill--to the TPA bill--that simply adds clear language to require that any future trade deals must include enforceable currency provisions. Very importantly, the provisions will be consistent with existing International Monetary Fund commitments that all of these countries have made. They signed up saying they are not going to do currency manipulation, but we do not have enforcement to make sure it does not happen. Also, importantly, this does not affect domestic monetary policy.

I understand the arguments. I have great respect for our Secretary of the Treasury, whom I work with all the time, and 99 percent of the time we are singing the same song--not on this one and the same thing with the President, someone whom I admire deeply. I have to say this administration has done more than any other White House, I think, that I have worked with as a Senator or even in the House, to make sure we are enforcing our trade laws, taking trade actions, winning trade cases in the WTO. I am very grateful for that. But when it comes to currency, there has been a debate saying that somehow our Fed policy, quantitative easing--what we do inside our country is somehow impacted by the definitions of the IMF, which is not accurate. A country can say it is. Anybody can say anything, but it would not hold up because it is not accurate. We are talking about foreign transactions, the monetary policies of foreign competitors in the global economy.

I am very pleased that we have bipartisan support for our amendment. We are adding supporters all the time. Senator Rounds, Senator Burr, Senator Casey, Senator Shaheen, and we have other Senators that will be joining us as well. We have growing support and understanding of how critical this is.

The inclusion of strong and enforceable currency provisions in our trade agreements make clear to our trading partners that this uncompetitive trade practice will no longer be accepted. We are not just going to talk about it. We talk a lot about it. We talk a lot about this issue and the loss of American jobs because of currency manipulation. But by putting it in the core instructions for our negotiators as they walk into a trade negotiation, to have listed alongside critical provisions regarding labor laws and environment and intellectual property rights and human rights and other areas, to say currency manipulation, your policies around currency we believe are critically important in a global economy if we are going to compete on a level playing field and not continue to lose American jobs.

Some would call this amendment a poison pill to the TPA. That could not be further from the truth. It is absolutely possible. In fact, we have Members supporting our amendment who also support TPA, the underlying bill. They want to make sure it is a clear outline of the priorities and instructions for any negotiations.

I have not heard from a single one of my colleagues that he or she will oppose the bill because our amendment is not adopted. This is not a poison pill. What I do hear repeatedly, though, is that one of the principal justifications for granting the administration trade promotion authority, fast-track--a process where we can amend it, a simple majority vote--is that Congress sets forth its priorities in trade promotion authority.

We are laying out what is important for the people of our country, for our businesses, for our workers in trade negotiations. If that is the case, then how can something deemed appropriate, deemed a priority by all of us be a poison pill?

It is not our job to match our priorities with their negotiations. The negotiations are supposed to match our priorities. They are laid out in TPA. Otherwise, why do we give fast-track authority?

It is our responsibility on behalf of American businesses, American workers, and American communities to tell the administration what we expect them to fight for on behalf of the people of our country. We already insist on enforceable standards in other negotiating objectives. I support these, and I believe they should be as strong as possible, including issues around labor law, environment, and intellectual property rights. Why should currency manipulation be any different?

This is about Congress setting up the list of priorities for negotiating objectives, and then in return for that, we then allow a fast-track process where any final bill cannot be amended. If we are going to give up that authority, that power, I think we have a right to lay out the conditions under which we would do that.

If we lost 5 million jobs around the globe--5 million jobs because of currency manipulation coming predominantly from Asian countries that we are now negotiating with--we have a right to say we want that to stop. We expect there to be a strong, enforceable currency manipulation provision in any law we pass that then gives up our right to amend a trade agreement.

There is no way that I believe the entire transpacific agreement hinges on whether we include enforceable currency provisions. If that is true, it calls into question what else is in the agreement. Why are there TPP countries that are so concerned about enforceable standards--which, by the way, they have all signed up through the IMF as part of the global community--they have all signed that they will not do it. If the argument now is that they are not doing it, then why are people fighting so hard to keep this requirement out of TPA if they are so confident this will never occur again?

Our ability to address currency issues in trade agreements is not complicated, again, by our own domestic monetary policies, including quantitative easing. In fact, we specifically put in the amendment that it does not affect domestic monetary policies.

We have heard this over and over again. There has been confusion that has been spread. The IMF has rules about what is and what is not direct currency manipulation. They are clear rules. They are rules that all of the IMF countries have agreed to. They are rules that the United States has followed while they are doing quantitative easing. They are rules that Japan has flagrantly violated not once or twice but 376 times since 1991.

We are hearing that we do not need enforceable language as a negotiating objective in the fast-track bill because Japan is not manipulating the currency anymore. Well, 376 times they have chosen to do that. Once we pass this, there is nothing stopping them from making it 377. What stops them is if they know that Congress is giving direction to the negotiators to make sure there is enforceable provisions in the trade agreement.

Let's be clear. The United States is clearly following the rules with our domestic monetary policy. We are following the rules. Therefore, we would not be affected by this, and our amendment specifically references that. We are not talking about domestic policy. Other countries could say that. They would be wrong. They would have no legal standing to say it. You can say anything. But we do know this: Japan has flagrantly violated the rules of the IMF--that they signed on the dotted line to support--376 times since 1991.

Adding enforceable currency provisions to a trade deal simply adds enforcement to the commitments that Japan and 187 other countries have already made as a part of the International Monetary Fund.

On that point, I appreciate the efforts this administration has made to engage on this issue with our trading partners both bilaterally and through multilateral forms such as the G-20 and the IMF. But, quite frankly, we have not seen enough meaningful progress despite, I am sure, our good efforts. The progress we have seen can be wiped out at a moment's notice and without any meaningful recourse if we do not require enforceable provisions in the fast-track law.

Then there is China. While they are not currently a party to the TPP, it is no secret they are interested in joining

it down the road. While China's exchange rate may be up nearly 30 percent since 2010, the Treasury's own report to Congress released just last month concludes that China's currency remains significantly undervalued, which, by the way, is the reason we also need to make sure the Customs bill, which will be coming before us, maintains what we did in the Finance Committee. It should maintain the important legislation which Senator Schumer and Senator Graham have been leading for years. I am proud to be a part of that, along with Senator Brown and many others. We came together on a bipartisan basis to make sure that China, which is not involved in the negotiations right now, is also held accountable for currency manipulation.

These two issues are not mutually exclusive; they are part of the whole effort. If they are part of a negotiating agreement and it is TPP or any other one, we want to make sure our negotiators put this in the deal. If they are outside of it, we want to also make sure they cannot cheat. That is why both of these are very important policies, and I strongly support both of them in order to move forward in a comprehensive way on currency manipulation enforcement.

For too long, we have relied on handshake agreements and good-faith assurances from our trading partners around the world that they would adhere to the same standards we set for ourselves. For too long, we have seen our trading partners ignore their commitments by breaking the rules and leaving American workers and businesses at a competitive disadvantage. It is time for us to say enough is enough. We don't have to keep doing this to ourselves.

I am very pleased that we have taken a step forward in a couple of directions. I mentioned the Schumer bipartisan proposal which so many of us have worked on. That is a very important piece of this puzzle. The other piece of this puzzle is the Portman-Stabenow amendment. As I said, these are not mutually exclusive; they are complementary. I hope my colleagues will support both of them to demonstrate a serious commitment. It is not enough to support a policy in one bill and not support a similar policy in the other part of the picture here, the other bill. If you support enforcing against currency manipulation--you either do or you don't. You do or you don't. We want to make sure we are doing it against those not part of the TPP negotiations and those who are. We want to make sure that they get signed into law and that they, in fact, are the law of the land. It is long past due that we take meaningful action on this issue.

I don't know how many times I have come to the floor since coming here in 2001 to speak about this and to be a part of this effort. It has always been bipartisan, and I am glad to see that. We need a strong, bipartisan vote on the Portman-Stabenow amendment. We have understood--those of us who represent manufacturing and agricultural States--that this is a critical piece that will help to level the playing field so our businesses, our farmers, our ranchers, and our workers have every opportunity to compete and win. I know they will. I don't have a doubt in my mind.

Our job is to make sure that there is fairness, that we have the best trade deals, that they are enforceable, and that we have the tools to enforce them, which is also in front of us with the Customs bill. We have to have all of it. We are in a global economy. Everybody is competing. Our job is to make sure we are exporting our products and not our jobs.

If we do not focus in a very serious, real way on addressing currency manipulation, we will, in fact, leave a giant loophole which those companies will drive right through and will allow them to continue cheating and taking our jobs. We can fix that, and I am hopeful my colleagues will join us on a bipartisan basis for a very strong vote so we can send a message to the administration that we are serious--including this as one of the instructions to them--as to what we expect to be in trade agreements going forward.

I thank the Presiding Officer.

I suggest the absence of a quorum.

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