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Hearing of the Senate Finance Committee - Oversight of Trade Functions: Customs and Other Trade Agencies -


Location: Washington, DC

SEN. STABENOW: How closely will you be looking, Mr. Chairman? (Laughter.)

We appreciate all of you being here and appreciate your work. Collectively, you really represent a very important effort to focus on American safety, health, commerce and also whether or not we have American jobs. And from my perspective with a state that reflects a large loss of manufacturing jobs, particularly since this decade began, and certainly understanding the fact that we've lost over 3.5 million manufacturing jobs in the country, some of that, not all of that, is just global competition. Some of that relates to have is happening as to trade enforcement. And I want to make sure we're exporting products and not our jobs. And I hope that's all of our goals.

One of the things I've heard this morning is that we have more trade agreements. Trade agreements have been increasing. Resources for trade enforcement has in fact gone down. So more trade agreements to be enforcing, less resources for trade enforcement. And certainly, that's something that we in Congress and the administration and the president's budgets all need to be held accountable for in terms of overall resources. But I do believe that we are not focused. This is not a new comment for me. But we are not focused sufficiently on enforcing the trade agreements that we have.

It's also concerning to me that when we talk about counterfeit products -- and Ms. Myers, I appreciate what's being done with individual examples, the counterfeit medicine you talk about. That's a serious, serious issue. And I'm pleased that ICE is responding to that and that there is project guardian and so on. But it's my understanding that we know that 80 percent of the counterfeit products that are being stopped and confiscated at our border are coming from one country, China.

So that goes to a larger policy then of how we enforce our trade agreement. China comes into the WTO. It's supposed to be following the rules and is not on counterfeiting and currency manipulation and so on, which goes to a broader issue.

My question and I, Commissioner Basham, would ask you, according to the GAO report, at least in April, Customs and Border Protection has failed to collect more than 613 million in anti-dumping and countervailing duties dollars since 2001. To my understanding that your agency believes it's very difficult to collect that money, that your Office of Chief Counsel plans to write off most of that at this point in time because importers have either disappeared or lack assets or have declared bankruptcy.

Unfortunately, when these things happen, it sends a very bad message internationally when we're not able to obviously enforce those issues. So do we need to overhaul our anti-dumping and countervailing duty collection system, or can you make substantial improvements within the current system to fix the problem? Because to me this is pretty basic. We're not collecting through those systems as we should be.

MR. BASHAM: Senator, as you know, the Department of Commerce establishes the fees or duties, penalties, on anti-dumping and countervailing duties. And our difficulty has been that, in many cases, the valuation of the product as it comes into the country really doesn't get liquidated for maybe two years after that point, when Commerce finally issues a liquidation order. And many times when we try to collect those duties, the company simply has never had any intention of paying it or the company goes out of business or we just can't locate the responsible party after that period of time.

What we have proposed is a continuous bond, that those bonds be set upon entry, which gives us a better opportunity to actually collect those duties at that later date, when the liquidation is determined. So we do believe that there needs to be -- we're working very closely with Commerce on this. Quite frankly, the cooperation between us and Commerce on these issues has improved considerably. And so, yes, we would like to work with this committee to develop a better process for collecting the duties and fees on these kinds of products that are coming into the country.

SEN. STABENOW: Thank you.

Anyone else want to respond? I think my time is up, but I would welcome any short response from anyone else.

Okay, thank you very much.

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