I

104TH CONGRESS

1ST SESSION H. R. 2651

To assess the impact of the NAFTA, to require further negotiation of certain

provisions of the NAFTA, and to provide for the withdrawal from the

NAFTA unless certain conditions are met.

IN THE HOUSE OF REPRESENTATIVES

NOVEMBER 16, 1995

Ms. KAPTUR (for herself, Mr. HUNTER, Mr. DEFAZIO, Mrs. CHENOWETH,

Mr. SANDERS, Mr. TRAFICANT, Mr. LIPINSKI, Mr. OBEY, Mr. PALLONE,

Ms. VELA ́ZQUEZ, Mr. BROWN of Ohio, Mr. EVANS, Mr. DELLUMS, Mr.

FUNDERBURK, Mr. KLINK, Mr. BARCIA of Michigan, Ms. MCKINNEY,

Mr. HINCHEY, Mr. STOKES, Mr. BARR, Mr. WAMP, Mrs. MINK of Hawaii, and Mr. CONYERS) introduced the following bill; which was referred

to the Committee on Ways and Means

A BILL

To assess the impact of the NAFTA, to require further

negotiation of certain provisions of the NAFTA, and

to provide for the withdrawal from the NAFTA unless

certain conditions are met.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘NAFTA Accountability

5 Act’’.
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1 SEC. 2. FINDINGS.

2 The Congress makes the following findings:

3 (1) EXPANDED MARKETS.—One of the purposes

4 of the NAFTA, as stated in the preamble, is to ‘‘cre5 ate an expanded and secure market’’ for goods and

6 services. Instead, the NAFTA has resulted in a spi7 raling trade deficit with Mexico and Canada that

8 will exceed $30,000,000,000 in 1995. Rather than

9 harmonious development and expansion as envi10 sioned, the NAFTA has resulted in trade deficits

11 which are draining $2,500,000,000 a month from

12 the United States economy.

13 (2) CURRENCY STABILITY.—One of the pur14 poses of the NAFTA is to ‘‘ensure a predictable

15 commercial framework for business planning and in16 vestment’’. However, the NAFTA contains no safe17 guards to minimize the negative economic impacts of

18 severe shifts in currency exchange rates among the

19 NAFTA Parties. To protect its own economy the

20 United States has sought to bolster the Mexican

21 peso which is now being supported by

22 $30,000,000,000 in loans, mostly from unwilling

23 United States taxpayers. The devaluation of the

24 Mexican peso has more than offset tariff reductions

25 and other trade benefits the United States expected

26 to achieve from the agreement.
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1 (3) FAIR AGRICULTURAL TRADE.—One of the

2 purposes of the NAFTA is to reduce distortions to

3 trade. In addition, the NAFTA is supposed to pro4 mote conditions of fair competition and to establish

5 mutually advantageous rules governing trade. How6 ever, since the NAFTA, there has been a rapid esca7 lation of one-way trade of Canadian grain exports of

8 wheat, durum wheat, and barley to the United

9 States, disrupting markets and marketing channels.

10 Surges in the importation of certain Mexican fruits

11 and vegetables threaten domestic production and the

12 importation of livestock and meat products from the

13 NAFTA Parties has exacerbated the severe problems

14 facing United States livestock producers.

15 (4) JOBS, WAGES, AND LIVING STANDARDS.—

16 One of the purposes of the NAFTA is to ‘‘create

17 new employment opportunities and improve working

18 conditions and living standards’’ in the respective

19 territories of the NAFTA Parties. Instead, there has

20 been a substantial loss of over 300,000 high-paying

21 jobs in the United States. A survey of United States

22 companies conducted 20 months after the implemen23 tation of the NAFTA found that 90 percent of the

24 companies that had anticipated an increased number

25 of jobs from the NAFTA have, in fact, not increased
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1 employment since the NAFTA was implemented. In

2 the first year of the NAFTA’s implementation, Unit3 ed States workers had the sharpest drop of real

4 hourly wages on record. More than 2,000,000 work5 ers have become unemployed in Mexico since the im6 plementation of the NAFTA and real wages of Mexi7 can workers have been slashed 50 percent. In addi8 tion to the loss of purchasing power, there has been

9 an erosion in the standards of living in the United

10 States, Canada, and Mexico.

11 (5) MANUFACTURING BASE.—One of the pur12 poses of the NAFTA is to enhance the competitive13 ness of firms in the global market. However, rather

14 than increase the ability of the manufacturing sector

15 in the United States to compete in the world mar16 ket, the NAFTA has facilitated the movement of

17 United States manufacturing facilities and jobs to

18 Mexico. The NAFTA has contributed to a net loss

19 of 227,000 manufacturing jobs in the United States

20 during the last 7 months and an unprecedented

21 flood of imports of manufactured goods into the

22 United States.

23 (6) HEALTH AND ENVIRONMENT.—Other pur24 poses of the NAFTA are ‘‘to safeguard the public

25 welfare’’ and ‘‘to strengthen the development and
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1 enforcement of environmental laws and regulations’’.

2 Yet, since the implementation of the NAFTA, the

3 public welfare has been undermined by increased im4 ports of food products that do not meet United

5 States health standards. In addition, the NAFTA

6 has accelerated the relocation of United States man7 ufacturing facilities to the United States-Mexico bor8 der zone, where hundreds of new manufacturing

9 plants have been added. Without adequate environ10 mental safeguards, the uncontrolled industrial and

11 population growth in the border zone has aggravated

12 pollution and health hazards, increasing the inci13 dence of infectious diseases and human exposure to

14 toxins.

15 (7) ILLEGAL DRUGS.—Rather than safeguard16 ing the public welfare, the NAFTA has allowed the

17 increased flow of illegal drugs and controlled sub18 stances into the United States from Mexico. More

19 than half of all cocaine and marijuana illegally en20 tering the United States now comes through Mexico,

21 with an increasing portion carried by trucks which

22 undergo more limited inspection under the NAFTA.

23 (8) PROTECT RIGHTS.—The promotion of sus24 tainable development as well as the protection and

25 enhancement of basic rights are stated objectives of
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1 the NAFTA. As envisioned, the NAFTA is to in2 crease economic opportunity together with expansion

3 of political freedoms and human rights. Yet these

4 objectives are not being fulfilled, especially in Mex5 ico, where some citizens continue to experience in6 fringements of such rights and freedoms.

7 (9) NAFTA SHOULD NOT BE EXPANDED.—The

8 Congress approved the NAFTA in order to achieve

9 economic, social, and environmental benefits for the

10 people of the United States. Based on currently

11 available information, the goals and objectives of the

12 NAFTA are not being achieved. Therefore, the

13 NAFTA should not be expanded to include any

14 other country.

15 (10) NAFTA TO BE RENEGOTIATED AND BEN16 EFITS CERTIFIED.—Based on the experience with

17 the NAFTA since its implementation, it has become

18 evident that further negotiation is required to re19 solve fundamental inadequacies within the NAFTA

20 with respect to trade balances, currency differentials,

21 and agricultural provisions. If the NAFTA is to con22 tinue, responsible public officials must be able to

23 certify specific measures of economic, social, and en24 vironmental progress. Otherwise Congress has no

25 choice but to withdraw its approval of the NAFTA.
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1 SEC. 3. CONDITIONS FOR CONTINUED PARTICIPATION IN

2 THE NAFTA.

3 (a) IN GENERAL.—

4 (1) WITHDRAWAL OF APPROVAL.—Notwith5 standing any other provision of law, unless each of

6 the conditions described in paragraph (2) is met—

7 (A) the approval of the NAFTA by the

8 Congress provided for in section 101(a) of the

9 North American Free Trade Agreement Imple10 mentation Act shall cease to be effective on Oc11 tober 1, 1997, and

12 (B) not later than April 1, 1997, the

13 President shall provide written notice of with14 drawal to the Governments of Canada and Mex15 ico in accordance with Article 2205 of the

16 NAFTA.

17 (2) CONDITIONS FOR CONTINUING PARTICIPA18 TION IN NAFTA.—The conditions described in this

19 paragraph are that before December 31, 1996—

20 (A) the President—

21 (i) renegotiate the terms of the

22 NAFTA in accordance with paragraphs

23 (1), (2), and (3) of subsection (b), and

24 (ii) provide the certification to the

25 Congress described in subsection (b)(8),
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1 (B) the Secretary of Labor provide the cer2 tification described in subsection (b)(4),

3 (C) the Secretary of Commerce provide the

4 certification described in subsection (b)(5),

5 (D) the Secretary of Agriculture and the

6 Administrator of the Food and Drug Adminis7 tration provide the certification described in

8 subsection (b)(6)(A),

9 (E) the Administrator of the Environ10 mental Protection Agency submit the certifi11 cation and report described in subsection

12 (b)(6)(B), and

13 (F) the Attorney General of the United

14 States provide the certification described in

15 subsection (b)(7).

16 (b) AREAS OF RENEGOTIATION AND CERTIFI17 CATION.—The areas of renegotiation and certification de18 scribed in this subsection are as follows:

19 (1) RENEGOTIATE THE NAFTA TO CORRECT

20 TRADE DEFICITS.—The President is authorized and

21 directed to confer with the Governments of Canada

22 and Mexico and to renegotiate the terms of the

23 NAFTA to provide for implementation of emergency

24 adjustments of tariffs, quotas, and other measures

25 to stabilize the flow of trade among the NAFTA
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1 Parties when the United States has an annual defi2 cit in trade of goods and services with another

3 NAFTA Party that exceeds 10 percent of United

4 States exports to that Party.

5 (2) RENEGOTIATE THE NAFTA TO CORRECT

6 CURRENCY DISTORTIONS.—The President is author7 ized and directed to confer with the Governments of

8 Canada and Mexico and to renegotiate the terms of

9 the NAFTA to provide for the implementation of

10 emergency adjustments of tariffs, quotas, and other

11 measures to mitigate the adverse effects of rapid or

12 substantial changes in exchange rates between the

13 United States dollar and the currency of another

14 NAFTA Party.

15 (3) RENEGOTIATE THE NAFTA TO CORRECT AG16 RICULTURAL PROVISIONS.—The President is author17 ized and directed to confer with the Governments of

18 Canada and Mexico and to renegotiate the terms of

19 the NAFTA to provide for the implementation of

20 emergency tariffs, quotas, and other measures to

21 bring the levels of wheat, durum wheat, and barley

22 imported from Canada to levels that are comparable

23 to the levels of these products imported during the

24 10-year period before the date the NAFTA entered

25 into force with respect to the United States. The
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1 President is further authorized and directed to re2 negotiate the NAFTA to establish and strengthen

3 provisions to prevent imports of agricultural com4 modities from any NAFTA Party from unfairly dis5 placing United States production and to provide im6 proved mechanisms for relief for United States pro7 ducers that are adversely impacted by such imports.

8 (4) CERTIFICATION OF GAINS IN UNITED

9 STATES JOBS AND LIVING STANDARDS.—If the Sec10 retary of Labor, after consultation with appropriate

11 government agencies and citizen organizations, de12 termines that—

13 (A) the number of jobs resulting from in14 creased exports of United States manufactured

15 goods to other NAFTA Parties exceeds the

16 number of jobs lost because of imports of man17 ufactured goods from other NAFTA Parties

18 since January 1, 1994, and

19 (B) the purchasing power of wage-earners

20 in the United States has increased since Janu21 ary 1, 1994,

22 the Secretary shall so certify to the Congress.

23 (5) CERTIFICATION OF INCREASED DOMESTIC

24 MANUFACTURING.—If the Secretary of Commerce,

25 after consultation with the appropriate government
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1 agencies and citizen organizations, determines that

2 the export of United States manufactured goods to

3 the NAFTA Parties exceeds the imports of manufac4 tured goods from NAFTA Parties, the Secretary

5 shall so certify to the Congress. In making the de6 termination, the Secretary shall not include any

7 goods originating outside the United States that are

8 exported to another NAFTA Party, nor imports

9 from another NAFTA Party that are destined for

10 other countries.

11 (6) CERTIFICATION RELATING TO HEALTH AND

12 ENVIRONMENTAL STANDARDS.—

13 (A) IN GENERAL.—If the Secretary of Ag14 riculture and the Administrator of the Food

15 and Drug Administration, after consultation

16 with appropriate government agencies and citi17 zen organizations, determine, with respect to

18 imports from NAFTA Parties, that since Janu19 ary 1, 1994, there has been a reduced incidence

20 of contaminated and adulterated food, food con21 taining additives or pesticide residues exceeding

22 United States standards, or food containing ad23 ditives or pesticide residues which cannot be le24 gally used in the United States, the Secretary

25 and Administrator shall so certify to the Con-
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1 gress. In making this determination, all foods

2 and food products, including fruits, vegetables,

3 grains, oilseeds, and meats, both fresh and

4 processed, shall be reviewed. Special attention

5 shall be given to foods which have had a history

6 of violations.

7 (B) BORDER AREA POLLUTION.—If the

8 Administrator of the Environmental Protection

9 Agency determines that conditions affecting

10 public health in the United States-Mexico bor11 der zone have not worsened since January 1,

12 1994, the Administrator shall so certify to the

13 Congress. In addition, the Administrator, in

14 consultation with the Secretariat for the

15 NAFTA Commission on Environmental Co16 operation, shall report to the Congress on the

17 outcomes of the Administration’s investigations

18 on pollution and health hazards in and around

19 the United States-Mexico border zone since the

20 implementation of the NAFTA. The report

21 shall include—

22 (i) a description and status report of

23 all industrial site cleanup and environ24 mental improvement projects begun in the

25 border zone since January 1, 1994;
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1 (ii) information available from local,

2 State, and Federal health agencies reflect3 ing the incidence since January 1, 1990, in

4 and around the border zone of hepatitis,

5 neural stem birth defects, lupus, chronic

6 adolescent diarrhea, tuberculosis,

7 nonneural birth defects, cholera, botulism,

8 and other disorders commonly related to

9 industrial pollution, inadequate infrastruc10 tures, and hazardous waste; and

11 (iii) information on the incidence of

12 air and water pollution since January 1,

13 1990, and the causes, levels, and types of

14 pollution which have occurred.

15 (7) CERTIFICATION RELATING TO ILLEGAL

16 DRUGS.—If the Attorney General of the United

17 States determines, after a review by the Drug En18 forcement Administration and consultation with ap19 propriate government agencies and citizen organiza20 tions, that increased imports from the NAFTA Par21 ties are not resulting in an increase in illegal drugs

22 or other controlled substances from Mexico or Can23 ada, the Attorney General shall so certify to the

24 Congress. The Attorney General through the Drug

25 Enforcement Administration shall conduct a thor-
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1 ough review and report to the Congress regarding

2 the flow of illegal drugs from Mexico and Canada

3 and the relationship of such flow to trade of other

4 commodities and services with the NAFTA Parties.

5 (8) CERTIFICATION RELATING TO DEMOCRACY

6 AND HUMAN FREEDOMS.—If the President, after

7 consultation with appropriate government agencies,

8 international organizations, and citizen organiza9 tions, determines that the Government of Mexico—

10 (A) is elected in free and fair elections,

11 (B) protects the rights of its citizens to or12 ganize into political parties,

13 (C) protects the rights of its citizens to

14 free speech and the right of the news media to

15 operate without fear of government control or

16 reprisal, and

17 (D) protects the rights of its citizens to as18 semble and to organize associations to advance

19 human rights and economic opportunities,

20 the President shall so certify to the Congress.

21 SEC. 4. CONSULTATION WITH CONGRESS.

22 The President shall consult regularly with the Con23 gress regarding the negotiations described in section 3(b)

24 (1), (2), and (3). The United States Trade Representative

25 shall consult with the appropriate committees of Congress
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1 in the development of any technical and conforming

2 amendments that may be required to carry out the provi3 sions of this Act.

4 SEC. 5. NO EXPANSION OF NAFTA.

5 Until such time as the conditions described in section

6 3(b) are met, it is the sense of the Congress that the Presi7 dent should not engage in negotiations to expand the

8 NAFTA to include other countries and that fast-track au9 thority should not be renewed with respect to the approval

10 of any such expansion of the NAFTA.

11 SEC. 6. DEFINITIONS.

12 As used in this Act:

13 (1) NAFTA.—The term ‘‘NAFTA’’ means the

14 North American Free Trade Agreement entered into

15 between the United States, Canada, and Mexico on

16 December 17, 1992.

17 (2) NAFTA PARTY.—The term ‘‘NAFTA

18 Party’’ means the United States, Canada, or Mexico.

19 (3) UNITED STATES-MEXICO BORDER ZONE.—

20 The term ‘‘United States-Mexico border zone’’

21 means the area that comprises the 12-mile zone on

22 the Mexican side of the United States-Mexico border

23 and the counties within any State of the United

24 States that are contiguous with Mexico.

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