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Public Statements

Free-Trade Agreements

Floor Speech

Location: Washington, DC

Mr. McCAIN. Mr. President, last night we gathered in the House Chamber for a joint session to listen to President Obama speak about our Nation's dire need to get our economy growing more strongly, to create jobs, and to get millions of Americans back to work. All Americans share this goal, even as we may have some disagreements over the best way to do it.

I think one way to create jobs most of us would agree on is opening new markets overseas to American workers, products and trade. U.S. products are the finest in the world, and we must lower barriers that impede free trade. To that end, we heard the President repeat, as he has previously on numerous occasions in speaking to Congress and the American people, that we must lower barriers that impede free trade. To that end, we heard the President say last night that he wants Congress to pass the three free-trade agreements, with Korea, Colombia, and Panama, that were concluded many years ago. I could not agree more.

Indeed, the International Trade Commission estimates that passing these three trade agreements could increase U.S. exports by $13 billion, creating approximately 250,000 new jobs.

So Republicans in Congress and many Democrats are ready to pass these trade agreements. I believe if we had a vote on the merits of those agreements they would pass with strong bipartisan support just as previous trade agreements have. The problem is, they continue to sit on the President's desk where they have been since the day he took office. Until he sends those agreements to Congress, there is nothing we can do to pass them.

Why does the President continue to urge Congress to pass agreements that we cannot pass until they are submitted to Congress?

Considering that the President wants these agreements passed, and considering that Congress has the votes to pass them, and considering the overwhelming benefits that each of these free-trade agreements would bring to our workers and our economy, the obvious question, then, is, Why hasn't the President chosen to send these agreements to Congress for final approval?

The answer, I am afraid, has much to do with electoral politics. My friends on the other side of the aisle have long insisted that the price of getting trade agreements through Congress is passage of domestic spending bills geared to assist U.S. workers who have been adversely affected by foreign trade. For this reason, in 2002, Congress passed the trade adjusted assistance legislation that provided short-term support for worker retraining and other assistance. Many Republicans were skeptical about whether this program and others like it achieved their goals. But we went along for the sake of our national interest in expanding free trade.

However, in 2009, without any action taken on our three pending trade agreements, my friends on the other side of the aisle dramatically increased the Trade Adjustment Assistance Program as part of the stimulus bill, raising spending on this program annually by more than $ 1/2 billion.

I might add that the stimulus bill was supposed to be a temporary stimulus. Now my friends and colleagues on the other side of the aisle want to make that increase permanent. In essence, a program that was designed to assist workers who had been adversely affected by free trade was transformed into a domestic slush fund for reasons that had nothing at all to do with expanding free trade.

What is worse, after repeatedly claiming it supports the free-trade agreements with Colombia, Panama, and Korea, earlier this year the White House announced that the cost of its support was reauthorization of the new trade adjustment assistance, with funding not set at the original 2002 level but the 2009 stimulus level.

So here we had a program that had been expanded from its original cost under the dubious guise of a temporary economic stimulus, and then we were told this temporary funding increase, which was designed to expire along with the stimulus, should, in fact, be turned into a permanent domestic spending program.

My friends, this is why Americans are so angry with Washington and with Congress. It is this mentality that has led to the explosion of government spending and national debt in this country, and it is unsustainable.

I acknowledge that expanding trade does temporarily put some of our workers at a disadvantage. I remember being roundly criticized during the 2008 Presidential campaign when I had the audacity to tell Michigan workers the truth--that many of the jobs that had left their State for cheaper labor markets overseas were never coming back.

So I understand that trade can create difficulties for some American workers. I am not opposed in principle to supporting those workers temporarily so they can develop new skills, find new jobs. I don't oppose, nor do I seek to kill, trade adjustment assistance--just to restore it to its original 2002 levels. That said, for a minute let's look closer at how the Federal Government has been going about employment and worker training programs such as this.

Earlier this year, the Government Accountability Office released a study entitled ``Multiple Training and Employment Programs: Providing Information on Co-Locating Services and Consolidating Administrative Structures Could Promote Efficiencies.'' A translation from the bureaucrats is, How is the Trade Adjustment Assistance Program working out? Here is what the GAO reported on Federal employment and retraining programs, including trade adjustment assistance:

The number of employment and training programs and their funding have increased since our 2003 report when we last reported on them. For fiscal year 2009, we identified 47 employment and training programs administered across nine agencies. Together, these programs spent approximately $18 billion on employment and training services in fiscal year 2009, according to our survey data. This is an increase of 3 programs and about $5 billion from our 2003 report. Adjusting for inflation, the amount of the increase is about $2 billion.

They went on to say:

We estimate, based on survey responses, that this increase is likely due to temporary funding from the Recovery Act for 14 of the 47 programs we identified. In addition to increasing funding for existing programs, the Recovery Act [the stimulus package] also created 3 new programs and modified several existing programs' target population groups and eligibility requirements, according to agency officials. For example, the Recovery Act modified the Trade Adjustment Assistance program by expanding group eligibility to include certain dislocated service workers who were impacted by foreign trade.

So, according to the GAO, many of our multiplying employment and training programs are duplicative of other such programs funded by the Federal Government. But that is not all. The GAO continues:

Based on our survey of agency officials, we determined that only 5 of the 47 programs have had impact studies that assess whether the program is responsible for improved employment outcomes. The five impact studies generally found that the effects of participation were not consistent across programs, with only some demonstrating positive impacts that tended to be small, inconclusive, or restricted to short-term impacts.

I will repeat that last sentence:

The five impact studies generally found that the effects of participation were not consistent across programs, with only some demonstrating positive impacts that tended to be small, inconclusive, or restricted to short-term impacts.

Not only are many of these employment and training programs duplicative, the GAO has found very little empirical evidence to support whether these programs are even accomplishing their intended goals, and what empirical evidence they have found is, I repeat, ``small, inconclusive, or restricted to short-term impacts.''

Trade adjustment assistance is among these programs. So my question is simple: At this time of crushing Federal debt and increasing fiscal austerity, why should we increase spending on a program that is likely duplicated by other Federal efforts and of which we cannot even say for sure it is working?

The real tragedy is, because our trade agenda has ground to a halt over this disagreement, the people who are suffering most are our workers and America's international economic leadership. The United States may not be doing much to advance free trade, but that is definitely not the case with other countries which are vigorously competing to get their workers and businesses into new overseas markets, often to the detriment of the United States of America. While we stand still, the world is moving past us.

In the 5 years we have failed to ratify the Colombia Free Trade Agreement, U.S. companies have paid more than $3.2 billion in Colombian import tariffs. That would disappear under the free-trade agreement. Since 2008 the United States has lost more than $800 million in agricultural exports to countries that trade freely with Colombia. Although less stark, the same story is true with Panama.

The people most disadvantaged by our failure to ratify these trade agreements are U.S. workers. What is more, Colombia, Panama, and Korea are not waiting on us. Our allies are not dependent upon us. They are confidently pursuing their own interests--with us if possible but without us if necessary. Colombia and Panama and many other Latin American countries are concluding their own trade agreements often at our expense. Since 2006 U.S. exporters lost 10 percent of their market share in Panama. From 2008 to 2009, our main agricultural exports to Colombia declined by more than 60 percent. These jobs are going to Europe, Canada, and China, but not because their workers are outcompeting ours but because Washington is forcing our exporters to compete with one hand tied behind their backs.

Indeed, Colombia recently began implementing its trade agreement with Canada, further disadvantaging our workers and what should be a natural market for us. Just this summer, South Korea's free-trade agreement with the European Union took effect.

We are losing ground and we need to get moving on trade immediately. I recognize the cost of doing so again will be Republicans' acquiescence to a vote to reauthorize Trade Adjustment Assistance. The Senate minority leader has repeatedly said he will support holding such a vote. So there is literally no reason why the White House should not send our trade agreements with Colombia, Panama, and Korea to Congress for an immediate vote. But as the Republican leader, Senator McConnell, has correctly insisted, these trade agreements should not be linked to a reauthorization of Trade Adjustment Assistance at their artificially inflated stimulus funding level.

I would remind my colleagues that in the first speech the President gave to Congress in early 2009, he advocated the passage of free-trade agreements. Again, last night, he mentioned the importance of the passage of free-trade agreements and called on Congress to pass these agreements. Our message back is: Mr. President, send us those agreements. Let us have open and honest debate. Let us have amendments. Let us have votes. But let us move forward. I am confident we can pass these free-trade agreements, but they have to be submitted to Congress. It seems fairly simple. Please, then, Mr. President, don't call on Congress again to pass these agreements unless you send them over to the Congress so we can ratify these agreements.

It is terrible what has happened in Colombia--losing billions of dollars we have had to pay in import tariffs for our goods going into Colombia, which should not have happened. By the way, Colombian goods come into the United States free of tariff because of the Andean trade preference agreements. So we are now at a disadvantage, where we pay tariffs on American goods going into Colombia but no tariff on Colombian goods coming into the United States. It makes no sense. South Korea--I believe it was last July--ratified a free-trade agreement with Europe. We are losing market share, and we are losing billions of dollars and thousands and thousands of jobs because we have not ratified these agreements.

The only way we can ratify them is for the President to send them over. Send them over, Mr. President. Send them over. Last night, he said: Pass these bills now. I am saying: Send the free-trade agreements over now. I will be glad to debate, amend--with time limits--and pass these free-trade agreements. I am confident there will be an overwhelming majority of bipartisan support for these agreements. We can work out the Trade Adjustment Assistance issue. We can debate and vote on it. But we have to have the agreements before us so we can move forward on it.

The people in my State are hurting. People all over America are hurting, as the President acknowledged at the beginning of his remarks last night. We can act. This is one area where I am confident we could move forward. So let us have those agreements sent over, and let us take them up as our first and most important priority in the coming weeks.

I yield the floor.

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