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United States-Korea Free Trade Agreement Implementation Act

Floor Speech

Location: Washington, DC

Mr. DeFAZIO. My friend who preceded me talked about the reduction in tariff exports. Well, guess what? That will be blown away if they manipulate their currency, and Korea is one of only three nations on Earth identified as a currency manipulator by our own U.S. Treasury. Does this agreement preclude currency manipulation? No, it does not.

Secondly, they rebate their national taxes, a Value Added Tax, to all their exports. Build a car in Korea, you don't have to pay taxes in Korea. Guess what? Build a car in the U.S., we can't rebate the taxes under these crummy trade laws we've bound ourselves to, and when the U.S. car gets to the border of Korea, they have to pay a 10 percent tax. So we're going to be able to export autos to Korea if they're 20 percent cheaper than those produced by cheaper labor in Korea. Not very likely, but let's say we could do that. Then there are a couple of other problems.

If you buy a U.S. car and if you're a Korean citizen, they will audit your taxes. Most employers do not allow the owners of foreign automobiles, which are mostly luxury automobiles over there--there are very few foreign automobiles--to have parking spaces at work. Also, Korea does not buy very many cars. They have a 65 percent mix: 65 percent of the cars they produce are exported.

This is not about U.S. exports to Korea. Once again, it's a platform for them to say to us stop here--it's cheaper--and displace American jobs.

Even the U.S. International Trade Council, the wildest cheerleader in the world for all of these failed agreements, says we're going to have a bigger deficit in autos. These are the same people who said we were going to have huge trade surpluses with Mexico. Whoops, got it wrong. They can't even mess around with this and pretend we're going to benefit from this--$300 million, they say, of additional auto exports to Korea and $1.7 billion of more auto exports from Korea to the U.S. That's what the cheerleader is saying. Imagine what the real numbers are going to be like.

We're talking about 160,000 to 200,000 U.S. jobs. Kiss the remainder of the auto industry and auto parts goodbye with this agreement.

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