More Hemorrhaging of American Jobs

Floor Speech

BREAK IN TRANSCRIPT

Mr. STRICKLAND. Mr. Speaker, I just want to say to my friends that what they are describing here is almost humorous, talking about the putting together of a hamburger as being a manufacturing activity, but it is serious because it represents deception. It represents an effort, quite frankly, to mislead the American people; and I hope they are listening tonight because this information is coming from the "Economic Report of the President"; and as my colleague said, it has got his name on it. So he is responsible for this charade.

I would like to read just one sentence from page 25, and I hope unemployed steelworkers along the Ohio River, I hope those who work in the pottery and ceramic plants along the Ohio River, on the Ohio and West Virginia side of that great river, I hope they understand what this means: "When a good or a service is produced at lower cost in another country, it makes sense to import it rather than to produce it domestically."

Let me say that nearly everything we make in this country can be produced in another country at a lower cost. I was in Mexico about 2 months ago. I talked to a woman who works for an American company. She works 9 ½ hours a day, 5 days a week. She showed me her weekly check, $38. Nearly every job in this country can be produced for less cost somewhere else; and the President's report says, "If a good or service is produced at lower cost in another country, it makes sense to import it rather than to produce it domestically." Apparently, they are willing to give up the entire employment base of this country, anything to get it a little cheaper. It is a race to the bottom. It absolutely is a race to the bottom.

I would hope the President would publicly renounce this report, disassociate himself from it, take his name off it. This is a report that is based on the theory of comparative advantage. If you can do it for less cost somewhere else, that is where we ought to do it. Where does it stop?

Mr. DeFAZIO. Mr. Speaker, the gentleman is making an excellent point; but of course, they are following exactly the same rules, are they not? Do we not have a level playing field? Are they not required to provide health and safety, environmental protections, child labor protections? Are we not competing on a level playing field here?

Mr. BROWN of Ohio. The answer to that is pretty obvious; but what is interesting, I remember standing on this floor 10 years ago with David Bonior, who was the real leader on these trade issues in Congress years ago, and they promised in those days with NAFTA that only the good-paying jobs would stay and these low-end, low-wage jobs would go overseas; and over time in Mexico they would begin to have stronger environmental laws, over time they would make higher wages, over time they would have good labor law, worker safety, all of that.

But as the gentleman from Oregon's (Mr. DeFazio) questions intimate, obviously these countries are not moving in that direction. In fact, we are seeing our country move in their direction. Our country move in their direction in terms of there are significantly fewer pension systems in this country, good pensions for workers than there were 10 years ago, and particularly fewer than there were in 1973 when this trade debacle really started in this country. That was really a key year in terms of turning the way we did trade.

We have seen our pension system atrophy. We have seen wages stagnate in most of these 30 years. We have seen environmental laws and States played off against States, and the Federal Government played off against the Mexican Government to weaken all these standards. Food safety laws are not as enforced, and clearly our food supply is not as safe as it would be if these trade agreements would actually raise their standards.
Instead of passing a trade agreement with Latin America to raise up their living standard, to raise their wages, to raise their workplace safety conditions, to raise their food safety standards, to raise environmental standards, we are seeing pressure on our government to bring those standards down so that we can compete with these countries. We should compete with them. They should compete with us, but let us raise living standards so ultimately they can buy our products, have a safer environment, have better food safety, have better worker safety and all that.
I yield to the gentleman from Ohio (Mr. Strickland).

Mr. STRICKLAND. Mr. Speaker, tomorrow morning Ohio's Governor Taft is going to be here in the capital city meeting with those of us who are Representatives from the State of Ohio.

The State of Ohio has been devastated, absolutely devastated and especially my district that stretches all along the Ohio River, some 330 miles. I have perhaps the poorest, the oldest, and the sickest district in Ohio. I have got lots of veterans. I have got lots of unemployed steelworkers. And what does the President say to them? How can the President come to Ohio and own this statement, "When a good or service is produced at lower cost in another country it makes sense to import it"? What does that mean?
We all have constituents and we are all concerned about our constituents. I am a little parochial in my concern I guess
because I have got a lot of constituents who do not have jobs, who have lost jobs. As a result, they have lost health care.

They have lost nearly everything they have worked their entire lives for, and we have an administration that is encouraging the outsourcing of jobs to other countries. It buffaloes me. I do not understand what kind of thinking goes into a document like this that is called the "Economic Report of the President."

Mr. BROWN of Ohio. Mr. Speaker, reclaiming my time, think about this: we have a President who is always at the beck and call of his corporate contributors. When it comes time to pass a Medicare bill, it is written by the insurance and the drug companies. When it comes time to pass Social Security privatization, it is written by Wall Street. When it comes to pass an environmental law, the President gives us a bill written by the chemical companies or the energy companies. Issue after issue after issue.

What we have really seen happen from the gentleman from Ohio's (Mr. Strickland) suggestion, what we have seen is as we pass trade agreements like this, making it harder for us to compete with Chinese workers, with Mexico, with Costa Rica, with El Salvador, one of the things that happens is we have seen a stagnation of U.S. wages and a weakening of food safety, environmental standards, and worker safety standards.

We also see in this body many of my Republican friends, particularly Republican leadership, are trying to pass legislation with the President to cut overtime in the U.S., to cut comp time opportunity in the U.S., to weaken environmental standards in the U.S., to weaken food safety standards in the U.S. So what they are doing internationally is in a lot of ways what they are doing domestically. It really does not cause George Bush or Gregory Mankiw, as chief economic adviser, to lose a lot of sleep that U.S. wages are stagnant, does not cause them to lose a lot of sleep if there is a downward pressure, a pulling down of environmental and worker safety standards, because that is what they are doing domestically.
So when Mr. Mankiw says they can do it cheaper in other countries, that means they have got comparative advantage, so send them overseas. The only way that we are going to compete in this Bush new world is to weaken our environmental standards, which is what they are trying to do anyway; to cut overtime, which is what they are trying to do anyway; to end comp time, which is what they are trying to do anyway; to roll back food safety, environment worker safety, wages, all of that. That is exactly what they are doing domestically.

It is what these trade agreements will do internationally. And who benefits? It is not the workers in Mexico. We have no axe to grind with them. It is not the slave laborers in China or the workers in awful conditions that are not slave labor in China, but the exploited generally, I was going to say young women, but really girls because they are not old enough to be women yet. We have no quarrel with them. They are hurt by these trade agreements just like American workers are hurt; but the investors who fund the Bush campaign and the chemical companies, the drug companies, the insurance companies, they get their legislation through. They love these trade agreements because it means more profits and it means more bonuses for these executives.

I yield to the gentleman from Oregon (Mr. DeFazio).

Mr. DeFAZIO. Mr. Speaker, I come from a State that back when we were fighting NAFTA, I was pretty lonely up there in the Pacific Northwest, and we were told, what is wrong with you, you are going to be a major beneficiary. The State of

Oregon on the Pacific Rim, strategically perched just north of Mexico and south of Canada, your State, your people are going to be a big winner, but it turns out that we are one of the top 10 losers under NAFTA.

As the gentleman alluded earlier, lumber and wood products are suffering because of subsidized Canadian lumber and wood products. The paper industry is seeing paper flee overseas to countries that do not observe any environmental practices or controls, and then a number of other more high-tech industries have gone elsewhere.

I sat next to a fellow who worked for Hewlett-Packard on the plane flying home a week ago, Hewlett-Packard in Corvallis. I said, what do you do?

He said, I work in the ink jet division. I do engineering, design, and development. I said, God, that is really great. I am glad to see you are still working there. I was worried about those jobs. He said, well, no, actually, he said, my entire division was exported to Bangalore, India, last year. I am just working on a special project here in the United States, but my division is gone. The next design development, the next ink jet technology is going to come from Bangalore, India. He said they can get an engineer there for 8 to $10,000 bucks a year.

Are we telling Americans they should go to college for 4 years, incur $50,000 of debt to get a degree in engineering technology or whatever it is going to cost them to do it, and then they are going to work for $8,000 a year, raise a family, buy a home and all the other things that are a part of the American Dream? These people are killing the American Dream. That is what they are doing.

There are a few people who are going to profit from it, and those are the people that support them; and they are so insulated from it some of them do not even realize what they are doing to destroy our country.

One other point. Sometimes that is not even enough to say to an American, 4-year, 6-year degree, you are going to compete with some guy or woman from Indian who worked for $8,000. Sometimes it is not enought. You know what we also do? We are subsidizing, the American taxpayers, through our taxes, are subsidizing the export of these jobs. Here is a short list:

Motorola laid off 42,900 workers while investing $3.4 billion in China with a $190 million taxpayers subsidy.

In General Electric, 260,000 U.S. workers, while investing $1.5 billion in China, $2.5 billion in corporate subsidies paid for by U.S. taxpayers. Insult to injury. Steal their jobs, destroy the economic future of our country, our kids and our grandkids, and charge us to do it. That is what they are doing to average wage-earning Americans, because most of this is coming out of Social Security wages, out of payroll taxes.

I said a little earlier that I feel kind of parochial in these concerns because each of us represents, I do not know, 630,000 or so men, women and children. I represent people who are desperate for jobs. Now, in a little town that my colleague represents that I think he is familiar with, Salem, Ohio, there is a company, the Elger Company. They make bathroom sinks and wash basins and so on. They decided a few months ago that they would go to China. That means that there are going to be lots of families without a job.

A short time ago, although the company has not really closed the operation in Salem yet, that is going to happen this spring, I got a call from one of the employees there, and they had just gotten a shipment of goods back from China, and they opened up the crates, and guess what they had stamped on the sides of those sinks and so on? "Made in the USA." The mold had not been changed, so they were forced to grind off the "Made in the USA" label. That is just an example.

I guess in China they can make a bathtub or a wash basin or a toilet for less cost than we can do it in Salem, Ohio, where these workers got living-wage jobs, paid taxes, supported their schools, gave to their churches, and cared for their children. They were good, solid, living-wage American jobs. But they can do it for less cost in China, so this administration says, oh, that is where it should be done then. So every worker at the Elger plant in Salem, Ohio, should know, and the community that depends upon those jobs should know, that this administration believes that is the right thing to do. As the President's report says, if it can be done more cheaply somewhere else, that is where it should be done.

If a cheap product is a cheap product or a reduced cost to the consumer is the ultimate good, then maybe what we are doing is the right thing. But if we believe that in this country people and the communities in which they live should have living-wage jobs which enable the workers to pay taxes, to support their schools, to contribute their taxes to the State and to local government, to be a fully functioning taxpayer.

And to buy the product, absolutely. If what we want is a cheaper pair of blue jeans from Wal-Mart, then maybe we are headed down the right road. But if we want a secure country, with stable families and secure communities, we had better change our way, because we are going to lose the American way of life. We are going to lose the middle class, and we are going to lose the ability to continue to support the infrastructure that makes us uniquely American.

Mr. BROWN of Ohio. Mr. Speaker, I thank my friend for those comments.
What is disturbing to me is that in this economic report, as the gentleman from Oregon (Mr. DeFazio) said, on page 4, signed by President Bush, this economic report put out by the President just this month says that there is nothing wrong
with the way the global economy is operating. He said outsourcing is a good thing.

Mr. Mankiw actually said, as we are seeing some of the most highly-skilled American workers, radiologists, for example, seeing their jobs threatened, Mr. Mankiw says an MRI or an X-ray will be taken that will be e-mailed to perhaps Bangalore, perhaps somewhere else, and read by a physician there who makes some minute percent of whatever the physician makes here, and then it comes back, because those radiologists are not in as much demand today as they once were. He said, well, it is a question of comparative advantage. Perhaps we just need to quit training so many radiologists.

They cannot compete. We need to maybe train more general surgeons or more family practice doctors.

Let me do a little tour around the world to show what the gentleman from Oregon said about how there simply are not going to be enough people to buy these goods. If a Nike worker in Oregon loses his job to a Nike worker in China, there is one less consumer to buy cars; one less consumer to buy clothes, because the Nike worker in China is not making much to buy anything.

Let me tell a quick story. About 5 years ago, when Congress was considering the fast track legislation to in those days lay the groundwork to extend NAFTA to Latin America, which President Bush is trying to foist on us, I, at my own expense, flew to McAllen, Texas, rented a car with a couple of friends, drove across the border and went to Reynoso, Mexico. I went to a worker's home who worked at General Electric Mexico, one of the largest employers in Mexico. The home of these workers were about 20 feet by 30 feet. They lived in a one-room shack: dirt floor, no running water, no electricity. When it rained hard, the dirt floor turned to mud. When you walked behind the shack, you saw a ditch of human and industrial waste. Who knows what it was. Children were playing nearby, as children will. The American Medical Association said that area along the border is perhaps the most toxic area in the Western Hemisphere.

Now, as you walked through this neighborhood of these shacks, you could tell where the workers worked because their homes were constructed out of packing material, boxes, wood platforms, crates, whatever, of the company for which they worked or the supplier for the company for which they worked.

We then visited nearby an auto plant. These workers at this GE plant in this home were making about $45 a week and working about 60 hours a week. But we went to this auto plant, and this auto plant in Reynoso, Mexico, 3 miles from the United States of America, looked just like an auto plant in the United States, just like a GM plant in Lordstown, near my colleague's district, or a Ford plant in Avon Lake or Lorain. It was modern. In fact, it was newer than the auto plants in our State mostly. It was modern, it was clean, it was the latest technology, and the workers were productive and hard-working.

There was one difference between the Mexican auto plant and an American auto plant. That difference was there was no parking lot in the Mexican auto plant because the workers do not make enough to buy the cars that they make.
You can go halfway around the world to Malaysia to a Motorola plant, and you will see the workers do not make enough to buy the cell phones they make. You can come back to this hemisphere and go to Haiti and see that the workers do not make it, to a Disney plant, and the workers do not make enough to buy the toys for their children they make. You can go back around the world to China and go to a Nike plant and see the workers do not make enough to buy the shoes which they make.

Now, the lesson is this continued downhill slide with globalization. If we pass a Central America Free Trade Agreement, if Congress passes the Free Trade Area of the Americas, if Congress continues the tax cuts for the wealthy and continues to allow the drug companies and the insurance companies to sit in the Oval Office, with a Vice President who is still on the Halliburton payroll, I might add, at $3,000 a week, allows them to continue to write this legislation, we are going to have a country like Brazil, with a very wealthy group at the top and a bunch of people at the bottom that are not making enough money to buy the shoes and to buy the toys for their kids, and to buy the cars, and to buy the cell phones.
If that is the society we want, then I guess maybe this report says let us keep doing it. But if it is not the society we want, then we need to say no to the Central American Free Trade Agreement, and we need to say no to this economic policy that has caused some of the highest unemployment rates in the country, in Oregon, and has devastated eastern Ohio and northeast Ohio where I live and damn near the rest of the State. We need to say no to that.

Mr. DeFAZIO. Mr. Speaker, if the gentleman will yield, when I lay this out to my constituents, they say, well, certainly the CEOs and others could not support that; they would not want to live in those communities or under those conditions or see those things happen. Well, the fact is today's CEOs, where there is still a manufacturing job, earns 500 times what a worker earns. It is only a couple of decades since the ratio was only 20. They do not live in the same communities. They do not live in the same world. They live on a different planet.

They live behind gates in their mansions with their servants. Now there will be a lot more servants out there for them, and probably the cost of servants will go down, so this will be a great benefit to them. Of course, under Bush we can import those, too, or maybe Americans can work for those low wages. Their kids go to private schools, so they are not worried about what the gentleman from Ohio was talking about, the support for our societal infrastructure, schools and those sorts of things.

They do not really need the police. I guess we have not gone back to private for-profit fire departments yet, that is probably not far away, but they have private security so that we do not find a lot of support from them for police infrastructure or first responders, particularly not with the administration cutting their budgets under the homeland security proposal.

And then when they want to go somewhere, they go to
the private country club in their chauffeur-driven limousines. Or if they go further away, they go in private executive jets so they do not even have to deal with the deregulation of the airline industry, the overcrowding and all those sorts of things. But these are true international folks. They are talking about globalization and international trade and all the benefits. There
are benefits for them, just not for the masses of America.

Whatever happened to Henry Ford? "My workers are going to be able to afford the product they make." We all did better under that system. We created the envy of the world here in the United States. We created the largest middle class. Everybody did better together. But a few people got greedy, and now they have got their hands on the levers of power, and they simply do not care about the majority. But they might find ways to distract them with wedge issues, social issues, or something else to distract them from the loss of their jobs, the opportunity for their kids, the lack of educational opportunities, or the future of this country.

I do not think the American people are going to be fooled for very long. They are going to demand changes, and we have to bring about changes. This trade policy is one of the most devastating levers of power that they have to wield against the American system, against American workers, and against the wealth of this country, and they are using it ruthlessly.

Mr. BROWN of Ohio. Mr. Speaker, my colleague put his finger right on it when we talk about these workers and the way that they are paid.

The key to our Nation's success, and the gentleman mentioned Henry Ford before, the key to our Nation's success is that workers share in the wealth they create. They are able to do that because we have a democracy. They are able to do that because we have a relatively strong labor union movement. They are able to do that because of mobility of labor, and a whole bunch of reasons in a free society here.

When workers are more productive, as they are in the United States, as they increasingly get more productive, that means their wages should go up. They have not in large part because of the downward pull of these trade agreements. In Mexico, for instance, and I remember David Bonior, the former Democratic whip, talking about this a dozen years ago, as productivity went up in Mexico, wages did not go up with them because they had a government that was authoritarian by and large, because they did not have free trade unions. They had government-controlled, business-controlled trade unions.

So do we want a country like that? Do we want a country where the workers share in the wealth they produce, or do we want a country like a bunch of Wal-Marts, where the workers barely get minimum wage in many cases, rarely have health benefits, and often have to work off the clock while the Wal-Mart family, several members of the Wal-Mart family, rank as some of the richest people in the country? Billions of dollars have accrued to many members of the family, billions and billions, tens of billions to many members of the family, but the workers do not really share in the wealth they produce.

That is a society that I do not think we want. We have seen that this country worked best, as the gentleman from Oregon mentioned, when workers at Ford got paid a wage where they could buy the cars, and workers all across the board were paid a decent livable wage that made an absolute difference in their lives.

I go back, Mr. Speaker, to some of the promises we have seen in this administration's economic policy. Understand again that the foundation of their economic policy is more tax cuts for the wealthiest people in our society and more trade agreements that end up shipping jobs overseas. That is the foundation of their society. It makes the wealthy, the Bush contributors, wealthier; it weakens and dilutes the middle class; and it is particularly hard on families barely making it.
We are going to see more promises in the next 8 months, as we have seen all along. This administration promised 3.4 million jobs. After September 11 they made a promise there would be 3.4 million more jobs in 2003 than there were when he took office. In fact, what we have seen is 1.7 million jobs lost. Again, more tax cuts for the rich and more trade agreements that ship jobs overseas. That is what the economic job loss is all about.

President Bush at the same time said we will have a budget deficit of only $14 billion. In fact, the budget deficit is $521
billion. We see these kinds of promises, and we will see them again. We see it in the new economic report. They promise 2.6 million jobs this year alone. Now they are backing off that. That is 200,000 jobs a month, and we are creating no jobs per month and we are still losing manufacturing jobs. They simply have not lived up to any of their promises. The only promise they live up to is a promise to their corporate contributors that they will continue to do them favors, they will continue to enrich them with their tax policy, and with the new laws they make on the Medicare bill and the Social Security bill and the environmental bills and the energy bills.

The gentleman made reference to our former colleague, David Bonior. I remember when NAFTA was passed some 10 years ago; and David Bonior stood on this
floor, as did others, and told us the truth. The other side told us what we now know are falsehoods. They told us if we pass NAFTA we are going to create more jobs in America and raise the standard of living of the folks who live in Mexico. They said it is a win/win. We know that manufacturing wage rates have actually declined in Mexico since NAFTA, and we have lost jobs here in this country.

This trade deal is only a part of the overall picture. The gentleman from Ohio (Mr. Brown) pointed out we have an exploding budget deficit. A Medicare bill was passed at 6 a.m. after arm twisting and deals were made, and perhaps even illegal activities, we do not know for sure, but that is certainly worthy of investigation; and it is being investigated. The fact is we now find out that it is not a $400 billion bill; it is a $534 billion bill, in part because there are no cost savings. There is no way to control the costs of prescription drugs in that bill because of our sellout to the pharmaceutical industry, basically.

But I believe this trade issue is the overarching issue because we cannot deal with our health care problems; we cannot deal with all of the other problems that face us, funding education, prescription drugs for our seniors, caring for our veterans; we just cannot do that unless we solve this trade deal that is bleeding jobs out of this country.

I get discouraged sometimes, and I would like to ask the gentleman from Ohio (Mr. Brown), what does the gentleman think can be done to reverse this? What is it going to take to reverse this?

Mr. BROWN of Ohio. Mr. Speaker, it is clear that either the President needs to change his mind, or we need to change the President. President Bush came to Richfield, Ohio, on Labor Day, and to his credit, he created a job that day. He said he was going to start a new office called the job of the manufacturing czar. He promised the job, but he has not filled the manufacturing czar's job yet. It is pretty clear when the President's answer to everything is the same tired, trickle-down economics, tax breaks for the wealthiest people and more trade agreements that hemorrhage jobs. If he is not going to change his mind, then this country is pretty clearly going on a different course.

Mr. DeFAZIO. Mr. Speaker, there is one exception to free trade. People have to realize who runs this administration. There is one exception to free trade, and it is for the first time in a trade agreement with Australia. It is a prohibition on the importation or the reimportation of FDA-approved, U.S.-manufactured pharmaceuticals from Australia, not because they are unsafe like the phony baloney they are giving us about Canada, but because they are cheaper there. That is in the trade agreement. What is that doing in the trade agreement if this is not all about big business and multinational corporations? It is not about making things cheaper for American consumers. If it was, why did President Bush insist on prohibiting the reimportation of FDA-approved, U.S.-manufactured drugs from Australia at half the price? It is not about making things less expensive and benefiting our consumers and our society. It is all about benefiting a very privileged few.

Mrs. JONES of Ohio. Mr. Speaker, I rise today as a member of the Ways and Means Committee to express my concerns about the Central American Free Trade Agreement. My concerns regarding this agreement cover many issues such as access to U.S. markets for agricultural goods, textiles and apparel, rules giving foreign investors the right to circumvent domestic courts and sue countries in binding arbitration, and the failure of the CAFTA to include enforceable, internationally-recognized, core labor standards.

CAFTA will lead to the expansion of export-oriented factories that are notorious for poor working conditions and exploitive working environments. Central America's textile industry is one of the most developed in the region. Companies
that hire mostly women aged 15-25 at low wages and under poor working conditions produce most of the clothing.

One of the poorest groups in the region are women that reside in rural areas. In fact, women are the heads of greater than 8 million rural households. Support for the rural sector in Central America is reflected by the lack of investment in rural infrastructure, financial services and human capital in the region. CAFTA only exacerbates the problems of the financially vulnerable small and medium sized farms forcing increased impoverishment of rural women.

Additionally, I want to discuss the effect these agreements will have on our trade deficit and how they will harm American workers.

The City of Cleveland in my congressional district currently has an unemployment rate of 13.1 percent. Much of that is due to lost jobs in the manufacturing sector. In fact, Cleveland has lost nearly 72,000 manufacturing jobs in the last four years. Additionally, in the State of Ohio, 18.8 percent of manufacturing job loss can be directly attributed to international trade. I anticipate that the most likely traded item this agreement facilitates will only be more U.S. jobs.

Like NAFTA, the Central American Free Trade Agreement will cause shifts in production from the US that will further engorge the already bloated trade deficit and lead to the loss of more US jobs. Both of these agreements facilitate the shift of U.S. investments while doing little to increase U.S. exports. Even U.S. investors do not escape unscathed, because the agreements contain large loopholes that allow foreign investors to claim rights above and beyond those our domestic investors enjoy. The agreement before us today is taking us down the path of further job losses and I urge my colleagues to oppose this measure.

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