WASHINGTON — The House and Senate appear to be moving ahead separately with trade bills in the waning days of the Congressional session, creating uncertainty about passage of any trade legislation.
Senate Finance Committee chairman Chuck Grassley (R., Iowa) and Sen. Max Baucus (D., Mont.), the ranking Democrat, on Wednesday introduced their own legislative package in a counterpunch against a trade bill introduced by House Ways & Means chairman Bill Thomas (R., Calif.).
There is little time left to reach a compromise, prompting many to speculate that GOP leaders might forgo action on the measures and pass them off to the Democratic-controlled Congress next year.
Essentially, both bills would grant permanent normal trade relations status to Vietnam and also extend benefits for expiring trade preference programs for the sub-Saharan African countries, the Andean countries of Peru, Colombia, Ecuador and Bolivia, as well as the generalized system of preferences program. They would also create new and expanded benefits and rules of origin for apparel production in Haiti and implement “noncontroversial” duty suspensions and reductions for hundreds of imported products that were contained in a miscellaneous tariff bill.
There are a few differences between the two bills, including the length of the extension of benefits for the four Andean countries and an apparel rule of origin change for sub-Saharan African countries contained in the Thomas bill, but not in the Grassley-Baucus measure.
Grassley and Baucus attached trade provisions to tax breaks for businesses and health care benefits, while Thomas’ bill is a straight trade package.
The Senate legislation would also suspend duties on certain cotton fabric imports and establish a trust fund capped at $16 million a year for eligible yarn spinners and shirt manufacturers, as well as a nationally recognized association promoting the growth of pima cotton in the U.S. The trust fund would expire on Oct. 1, 2008.
Although few substantive differences on the trade provisions exist between the Senate and House, both face significant hurdles.
Sen. Elizabeth Dole (R. N.C.), a long-time proponent of trade expansion with Haiti, announced her opposition Wednesday to provisions that would expand duty free benefits to apparel imports from Haiti.
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“Sen. Dole…strongly supports measures to expand trade between Haiti and the United States, but she cannot support the Haiti trade bill now being considered in the House because this poorly designed bill would cause serious harm to the U.S. textile industry, potentially putting many North Carolina textile workers out of a job,” according to a statement released by her office before the Grassley-Baucus bill was introduced.
Meanwhile, the House Textile Caucus appeared poised to vote against the trade package in that chamber, while several Republicans and Democrats voted against a stand-alone Vietnam bill on Nov. 13, which failed to get the two-thirds vote necessary.
“The thing that has been most frustrating, especially for the domestic textile industry, is that no hearings were held on this legislation,” said Carolyn Hern, communications director for Rep. Robin Hayes (R., N.C.). “Frankly, the industry has been shut out of making suggestions and improving this bill.”
Textile-state lawmakers and industry lobbyists oppose expanded benefits for Haiti that allow companies to use foreign fabrics and yarns, notably from China, which would undercut existing U.S. fabric and yarn export business to the Caribbean region. Under the current preference program rules, companies in Haiti must use U.S. or Haitian fabrics and yarns with a few limited exceptions.