Statement of Jim McDermott
  Hearing on
President Obama’s Trade Policy Agenda
February 29, 2012

Washington State is Exhibit A for the argument that trade presents enormous opportunities for U.S. workers, farmers and business.  According to the Washington Public Ports Association, roughly one in four jobs in my State is tied to foreign exports, and the pay for these jobs is about 46% more than the overall average in the State. 

But, my constituents believe – and I agree with them – that we have to get the full bang for our buck out of our trade deals. 

When a country signs a trade agreement with the United States, they have to fulfill their obligations. 

If they fall down on the job, the United States must use all available tools at its disposal to make them live up to their commitments.  It’s just basic fair play.

Last year, my Democratic colleagues and I called for the development of ‘a comprehensive and robust strategy to help rebalance our trading relationship with China.’ 

By creating a new Interagency Trade Enforcement Center (ITEC), the President is answering that call. 

The ITEC will increase the administration’s ability to make sure China and our other trading partners keep their promises.

It needs to be made clear -- China’s unfair trade practices have consequences, not just for the United States and other developed countries, but for developing countries as well, including countries in Sub-Saharan Africa.  

We can help lesser-developed Sub-Saharan African countries compete against China by extending the “third-country fabric” provision, one of the most important elements of the African Growth and Opportunity Act. 

This provision, which expires in September, allows apparel producers in these countries to use third-country fabric in making apparel that gets duty-free treatment under AGOA.  Sub-Saharan Africa competes with China in manufacturing exports.

Last July, Charlie Rangel and I introduced legislation to extend the third-country fabric provision until 2015.  Identical legislation was introduced by Senators Baucus and Hatch last December.

Both Chairman Camp and Trade Subcommittee Chairman Brady committed months ago to moving this legislation, and yet there has been no action.  Buyers are already turning away from the AGOA region because of uncertainty.

I understand that some House Republicans have concerns about sending a revenue measure over to the Senate.  If they need an iron clad commitment from Senator Reid and Senator McConnell that there won’t be any shenanigans, they’ll get one.   We cannot wait any longer to act.

I also want to take a moment to applaud the work of USTR on the Boeing-Airbus case and the May 2011 Appellate Body decision that ruled that Airbus launch aid and other subsidies violated WTO rules.  If the EU continues to drag its feet and doesn’t withdraw the subsidies then we should go directly to a compliance proceeding.

My staff's been working with Mr. Reichert’s staff, the senate and your folks at Commerce on a bill that will really help the National Export Initiative -- to make us much better at exporting. The bill will have no cost and will solve some real problems to increase exports. I just want you to know we appreciate your team’s work on it.

I have one question for the Ambassador on TPP and IPR medicines.  The May 10 changes struck a fair balance between: (1) timely access to affordable medicines in developing countries; and (2) protection for innovation.

In the TPP negotiations, USTR has proposed an alternative that throws off this balance in favor of protecting innovation.  How have the other TPP countries, especially the developing countries, reacted to your proposal?