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47–244—PDF 2007

S. HRG. 110–761

TRADE AND GLOBALIZATION: ADJUSTMENT FOR

A 21ST-CENTURY WORKFORCE

HEARING

BEFORE THE

COMMITTEE ON FINANCE

UNITED STATES SENATE

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

JUNE 6, 2007

(

Printed for the use of the Committee on Finance
COMMITTEE ON FINANCE

MAX BAUCUS, Montana, Chairman

JOHN D. ROCKEFELLER IV, West Virginia

KENT CONRAD, North Dakota

JEFF BINGAMAN, New Mexico

JOHN F. KERRY, Massachusetts

BLANCHE L. LINCOLN, Arkansas

RON WYDEN, Oregon

CHARLES E. SCHUMER, New York

DEBBIE STABENOW, Michigan

MARIA CANTWELL, Washington

KEN SALAZAR, Colorado

CHUCK GRASSLEY, Iowa

ORRIN G. HATCH, Utah

TRENT LOTT, Mississippi

OLYMPIA J. SNOWE, Maine

JON KYL, Arizona

CRAIG THOMAS, Wyoming

GORDON SMITH, Oregon

JIM BUNNING, Kentucky

MIKE CRAPO, Idaho

PAT ROBERTS, Kansas

RUSSELL SULLIVAN, Staff Director

KOLAN DAVIS, Republican Staff Director and Chief Counsel

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C O N T E N T S

OPENING STATEMENTS

Page

Baucus, Hon. Max, a U.S. Senator from Montana, chairman, Committee

on Finance ............................................................................................................ 1

Grassley, Hon. Chuck, a U.S. Senator from Iowa ................................................. 2

WITNESSES

Brainard, Dr. Lael, vice president and director, The Brookings Institution

Global Economy and Development Program, Washington, DC ........................ 5

Didier, Kim, executive director, Newton Development Corporation, Newton,

IA ........................................................................................................................... 7

McDonald-Pines, Jane, workforce policy specialist, AFL–CIO, Washington,

DC .......................................................................................................................... 8

Rosen, Howard, executive director, Trade Adjustment Assistance Coalition,

Washington, DC; accompanied by Greg Mastel, senior advisor, Trade Adjustment Assistance Coalition, Washington, DC ............................................... 10

Ross, Jerry Ann, current participant in the Trade Adjustment Assistance

program, Eureka, MT .......................................................................................... 12

ALPHABETICAL LISTING AND APPENDIX MATERIAL

Baucus, Hon. Max:

Opening statement ........................................................................................... 1

Brainard, Dr. Lael:

Testimony .......................................................................................................... 5

Prepared statement .......................................................................................... 33

Bunning, Hon. Jim:

Prepared statement .......................................................................................... 40

Didier, Kim:

Testimony .......................................................................................................... 7

Prepared statement .......................................................................................... 41

Grassley, Hon. Chuck:

Opening statement ........................................................................................... 2

McDonald-Pines, Jane:

Testimony .......................................................................................................... 8

Prepared statement with attachment ............................................................. 45

Rosen, Howard:

Testimony .......................................................................................................... 10

Prepared statement .......................................................................................... 55

Ross, Jerry Ann:

Testimony .......................................................................................................... 12

Prepared statement .......................................................................................... 71

COMMUNICATION

National Association of Health Underwriters ....................................................... 75

(III)

(1)

TRADE AND GLOBALIZATION: ADJUSTMENT

FOR A 21ST-CENTURY WORKFORCE

WEDNESDAY, JUNE 6, 2007

U.S. SENATE, COMMITTEE ON FINANCE, Washington, DC.

The hearing was convened, pursuant to notice, at 10:07 a.m., in

room SD–215, Dirksen Senate Office Building, Hon. Max Baucus

(chairman of the committee) presiding.

Present: Senators Bingaman, Lincoln, Cantwell, Salazar, Grassley, Snowe, and Bunning.

OPENING STATEMENT OF HON. MAX BAUCUS, A U.S. SENATOR

FROM MONTANA, CHAIRMAN, COMMITTEE ON FINANCE

The CHAIRMAN. The committee will come to order.

Before the committee begins its scheduled business meeting, I

want to take a moment to honor our colleague and friend, Senator

Craig Thomas.

Senator Thomas was a valued member of this committee since

2001. He chaired the Subcommittee on International Trade in the

last two Congresses and was very instrumental in setting up a new

subcommittee of this committee on Energy and Natural Resources.

As soon as he came to me and suggested it, I knew right off the

top, this is the right thing to do, and we needed to do it. It is so

important for our country. It is just an example of how Craig

Thomas was ahead of most people, and also directly addressing

problems facing our country, as well as his home State in Wyoming.

But I think many will remember him more for who he was than

what he did. We will remember Craig as being a very, very principled person. He had his roots and his basis firmly grounded in

the State of Wyoming, but he was also totally a gentleman, decent

and kind in furthering his goals and his principles.

He was so, so wonderful to work with: no rancor, never made his

arguments personal, always smiling, always forthright, and in

many ways he reminded me of my father because, in the case of

both Craig Thomas and my father, I do not know anybody who ever

had an ill word to speak about either one of them. They are just

that strong in personality and character.

Mr. Thomas was truly a man of the American West; kind of

quiet, did not seek the soap box, did not seek glamour or headlines,

just very much wanted to get the job done, but in a very, very solid,

principled way. I know at least that is how I will remember Craig

Thomas. He will always be an inspiration for me as just a wonder-
2

ful person, someone whose characteristics we should strive for. He

is a very special person.

Now I ask for a moment of silence in honor of Craig Thomas.

[Pause.]

The CHAIRMAN. Thank you.

Forty-five years ago, President John F. Kennedy said, ‘‘Those injured by trade competition should not be required to bear the full

brunt of the impact. There is an obligation to render assistance to

those who suffer as a result of national trade policy.’’

Congress agreed. When Congress enacted the Trade Expansion

Act of 1962, that law contained President Kennedy’s new Trade Adjustment Assistance program called TAA.

But times have changed since Congress created TAA. Back then,

ocean-going container ships were a new way to transport goods.

Today, container ships carry 17 times the cargo in three-quarters

of the time that they did half a century ago.

Factories have become more efficient. Millions of workers moved

out of manufacturing and into services. And worldwide advancements in technology and communications now move boxes, services,

and ideas around the globe in record time, and some at the speed

of light.

Times have changed, but the government’s approach to trade adjustment has not. American workers still have to rely on a program

that was crafted for a different era. It is time to change that. It

is time to ask tough questions. Is today’s TAA relevant to the 21stcentury global economy? Does every eligible worker have the opportunity to re-train and re-tool and find a good job with good pay?

Are the benefits that the government offers, like health care tax

credits, making a difference? And are American firms and farmers

getting the assistance that Congress promised them?

Today we have a distinguished panel of witnesses to help us answer these questions, and more. Those answers will help guide this

committee as it looks to reauthorize and expand TAA before it expires at the end of September.

So let us begin by examining the opportunities and challenges

that we face in this new century. Let us learn how we can help

more Americans to get ahead in today’s global economy, and let us

make sure that a 21st-century TAA helps to keep President Kennedy’s promise that we render assistance to those injured by national trade policy.

Senator Grassley?

OPENING STATEMENT OF HON. CHUCK GRASSLEY,

A U.S. SENATOR FROM IOWA

Senator GRASSLEY. Before I speak to the issue before us, I can

only associate myself with the remarks that you gave about Senator Thomas. You spoke very accurately, representing him and how

he interacted with us and the issues before the Congress.

The only thing I would add to what you said is that the issues

that we are talking about in this committee today—trade issues—

were one of the most important subjects that we deal with in this

committee that he was most involved in, and he had strong views

about them.
3

I think it is fair to say that he was a person who believed in free

trade, but he was also a person who believed that the United

States needed to be very aggressive in making sure that the United

States and its workers were treated fairly, and that the government enforced laws to make sure that fairness was a result.

I remember him, on trade issues probably more than any other

issue, asking the tough questions during our hearings, and maybe

being the toughest negotiator on the various bills that we have had

before the committee. So, he would feel right at home here if he

were with us today as we discuss this issue of trade.

Mr. Chairman, I thank you for this hearing. I have an opportunity to introduce to the committee, and you will introduce to a

greater extent than I will, Kim Didier, executive director of the

Newton Development Corporation in Newton, IA.

Newton, IA is doing everything it can to recover from the loss of

110 years of the Maytag Corporation being there, making a very

quality product in home appliances that now has been purchased

by Whirlpool and is moving out of Newton.

The city is pulling together very strongly in a united way to

make sure that they still are an economic power house within the

State of Iowa, and I am sure that this is one of your main concerns,

Ms. Didier.

In 2002, I worked with Chairman Baucus to shepherd landmark

reforms to our Trade Adjustment Assistance program through Congress, and this was when Senator Baucus was then Chairman of

the committee, as he is now. Since then, I have joined him in oversight of both programs and those reforms. We work together in anticipation of the need to reauthorize Trade Adjustment Assistance

this year.

And particularly in the oversight capacity, I joined the Chairman

in requesting a series of reports from the Government Accountability Office examining various aspects of the operation of these

programs. So, I want to thank the folks at the Government Accountability Office for their many efforts, especially Dianne Blank

and Sigurd Nilson.

Our Trade Adjustment Assistance programs already operate differently than they did a few years ago, and for sure differently

than maybe the original way they worked in 1963 when they were

the idea of then-President Kennedy.

That is due in part, of course, to operating differently because of

our 2002 reforms. It is also due to administrative changes implemented by the Department of Labor. So Secretary Chao and other

administrators in the Department are to be commended for their

efforts in making sure that these programs are run in the most efficient way and within the intent of Congress.

I think everyone shares the goal of ensuring effective administration of appropriate services to help trade-affected workers return to

the workforce. The challenge before the committee in reauthorizing

these programs is to improve them in a fiscally responsible manner

so that they best meet our goals. And that goal obviously is expanded by the fact that enhanced globalization has brought trade

affecting more unemployed people than maybe was originally anticipated.
4

Today’s hearing will help the committee substantially in that effort. I am interested in examining ways to simplify program deadlines. I am also interested in considering ways to hold States accountable for the quality of the data that they report to the Department of Labor. I am interested in exploring ways to better disseminate information to trade-affected workers.

Above all, I am interested in improving the programs so that

they empower individual workers affected by trade to respond to

their dislocation as they deem appropriate. One size does not fit all.

Workers should have a sufficient amount of time to decide how best

to respond to their own dislocation impact. Workers should not

have to wait until they actually lose their jobs to receive appropriate benefits when there is a prospective announcement of job

losses due to trade.

Workers should have the option of returning to work on a parttime basis and still have access to appropriate benefits. We need

to increase the flexibility of programs so that workers can optimize

their individual responses and, as I stated previously, do it in a fiscally responsible manner.

My comments thus far have been directed at trade adjustment

programs for workers. In 2002, we created then a separate trade

adjustment program for people of my background: farming. We

need to examine how well those programs have worked as part of

the review. We need to review the Trade Adjustment Assistance for

farm programs as well.

One last point. From my perspective, any effort to reauthorize

our Trade Adjustment Assistance programs must be linked to an

extension of Trade Promotion Authority. The Doha Round negotiations in the World Trade Organization are at a critical stage, and

in the next few weeks, very critical.

We need to ensure that the negotiations have a realistic chance

to conclude successfully. In order for that to happen, we need to

guarantee an up-or-down vote in Congress by extending Trade Promotion Authority.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you, Senator, very much.

I would like to now welcome our witnesses, a very knowledgeable

and dedicated panel.

Our first witness is Dr. Lael Brainard, who is the vice president

and founding director of the Brookings Institution’s Global Economy and Development Program.

Dr. Brainard will be followed by Ms. Kim Didier, as already introduced by Senator Grassley. Thank you, Ms. Didier, for being

here. She is the executive director of the Newton Development Corporation in Newton, IA.

Our third witness is Ms. Jane McDonald-Pines, who is also extremely knowledgeable, a specialist in workforce policy at the AFL–

CIO.

She will be followed by Mr. Howard Rosen, the executive director

of the nonprofit TAA Coalition, and a visiting fellow with the Peterson Institute for International Economics. I do not know anybody

who knows more about the TAA program than Mr. Rosen.

I am especially pleased and proud to welcome our fifth witness,

Ms. Jerry Ross, who traveled all the way from Eureka, MT. For
5

those of you who do not know, Eureka is pretty far north in Montana. It is far north, in the upper northwestern part of Montana,

very close to the Canadian border. Thank you very much, Ms. Ross,

for taking the time to be with us here today. I might say to the

committee, that she is in a short break from her TAA training this

week. She has a very interesting story to tell about her experience

with the program and her daughter’s experience with the program.

I think we can learn a lot from Jerry’s direct practical experience.

So let us begin with you, Dr. Brainard. Welcome back to the committee.

STATEMENT OF DR. LAEL BRAINARD, VICE PRESIDENT AND

DIRECTOR, THE BROOKINGS INSTITUTION GLOBAL ECONOMY AND DEVELOPMENT PROGRAM, WASHINGTON, DC

Dr. BRAINARD. Well, it is a pleasure to be here, Chairman Baucus, Senator Grassley, and members of the committee. I certainly

appreciate the opportunity to testify. I think this could not be a

more important issue.

Let me make four observations, just broadly speaking. First, I

think we are experiencing a globalization challenge that is different

in scale, in speed, and in scope than previous challenges that we

faced. If you think about China’s rise, it is pursuing a growth strategy that is very much export-led, foreign direct investment-fed, and

is sending ripples to manufacturing sectors around the world.

India’s concurrent economic emergence has made this challenge

much more complicated, I think, for American workers. India’s success in exporting high-skilled knowledge services means that the

challenges of competing with low-wage foreign workers has now

spread to sectors of the economy that simply were not exposed to

trade even 10 years ago.

And if you think about the two economies coming on-line together, it amounts to a 70-percent expansion of the global labor

force, most of these workers coming in at a wage scale that is 10

percent, 15 percent of the wage scale here.

If you think about the earlier challenges associated with Japan,

South Korea, the Asian newly industrialized economies, this challenge is more than 3 times as big. Any textbook economics would

predict there would be a squeeze on wage earners as capital and

technology investment adjust.

A second observation is that the current winds of globalization

are bigger than a trade agreement. I think we have grown accustomed to thinking about globalization as something which we can

negotiate the terms of, and consequently, when we think about

Trade Adjustment Assistance, it has been viewed as tied to a particular trade agreement, a particular expansion of trade. But the

reality today is that globalization is facilitated by trade agreements, but it is in no way confined to them.

If you think just for a minute about services offshoring, that was

facilitated by the digitization and transmissibility of services and

India’s own choice to invest in broadband; we never signed a piece

of paper or passed a law here.

So I think, if we want to maintain support for the open and dynamic economy that we have, it should not take 3 years to be able
6

to bring our adjustment programs into line with those new realities.

A third, quick observation is simply to echo Senator Baucus’s

words. When the program was put in place, I think President Kennedy stated a principle which is no less true today, that those injured by competition from trade should not be required to bear the

full brunt of that impact.

The principle remains the same, but the workforce and the challenges faced by the workforce are very different. Today’s workers

are much more likely to transition several times. The percentage

of workers who stay in jobs for 10 years is down markedly from 20

or 30 years ago.

Permanent dislocation, as we all know, can result in devastating

insecurity. Across all full-time workers, permanent dislocation

leads to average earnings losses of about 14 percent; in manufacturing it is more like 19 percent. As we all know, displaced workers

in import-competing industries face even larger permanent wage

declines.

Then the final point is, I think everybody here will agree, it is

absolutely vital to continue strengthening Trade Adjustment Assistance. I think the committee is currently considering several

changes to the scope and the operation of TAA that I think are

vital.

As Senator Grassley said, there were landmark changes introduced by this committee in 2002. We have now had 5 years to observe them, to learn from them, and I think it is now time to again

take that learning and move forward.

I think it is a poorly kept secret that the eligibility process of

TAA is a serious flaw, and so we should think about automatic

triggers or other ways of getting workers into TAA quickly and

more proactively.

Services workers, farmers dislocated due to globalization still are

not getting the access to adjustment assistance that they deserve.

The cost of the health care tax credit remains out of reach for too

many families.

Wage insurance should be a real option for a much larger group.

Most workers still do not hear about it or they cannot qualify because of the amount of time that they need to get into a new job.

As Senator Grassley said, training benefits should be flexible.

They should be structured so that you do not need to take several

years off. If you need to get back to work, that you can get trained

in and around your work, or you go into a training program fulltime. And, of course, they should not be rationed. They should be

fully funded.

Finally, adjustment assistance for farms and for communities

has never been implemented with the kind of robustness and seriousness that it should be.

So I think American workers in every sector need Trade Adjustment Assistance and they need it to be stronger, more flexible. To

do anything less, I think, will put at risk support for our very dynamic and open economy.

Thank you.

The CHAIRMAN. Thank you very much. Under 5 minutes, too.

Thank you very much. I might say to everyone, your full statement
7

will be automatically included, but I encourage you to stay within

5 minutes if you can.

Thanks.

[The prepared statement of Dr. Brainard appears in the appendix.]

The CHAIRMAN. Ms. Didier?

STATEMENT OF KIM DIDIER, EXECUTIVE DIRECTOR,

NEWTON DEVELOPMENT CORPORATION, NEWTON, IA

Ms. DIDIER. Thank you, Mr. Chairman, Senator Grassley, and

other distinguished members of the committee. On behalf of the

community that surrounds Newton, IA, we appreciate the opportunity today to share our story of transformation.

We began those transformational efforts just over a year ago

when residents of Newton and the surrounding area found themselves facing the impact—the direct impact—of globalization and

the changing manufacturing landscape in the United States.

On May 10, 2006, the announcement was made that the Maytag

Corporation would no longer have a presence in Newton, IA: within

7 months the majority of the Maytag world headquarters’ operations would be closed, and by October of this year, a 113-year tradition of manufacturing washers and dryers in Newton, IA would

cease. A total of 1,900 employees, from senior vice presidents, to

engineers, to line production workers would eventually lose their

positions.

And although we recognize that our story and the loss of manufacturing operations in the United States is not a new story, we do

believe our story epitomizes the impact of globalization on our National and local economies.

Moreover, we believe that the experiences as a result of losing

Maytag can help guide policymakers. Again, not only has it impacted the employees losing their positions, but it impacts the community as a whole. It is from this community perspective that I

offer my comments to you today.

At its peak in the mid-1990s, Maytag Corporation employed over

3,500 individuals locally and 29,000 worldwide. Some Maytag employees commuted an hour to an hour and a half each direction.

The Maytag Corporation pumped nearly $100 million into the regional economy and provided another half a million dollars through

their corporate foundation through direct grants and support to

local nonprofits.

Given the significance of the Maytag organization in the community, it is understandable that the immediate response to the announced departure involved many different emotions and reactions.

But very quickly the community realized that it needed to respond

with a collaborative effort in creating a community vision and work

toward creating it into reality.

On May 10, we created the Newton Transformation Council. It

included business and community leaders and stakeholders across

the State of Iowa from a group that had been working together

prior to the announcement on actual retention strategies.

The Newton Transformation Council is a powerful, grassroots effort working to sustain and improve the quality of life in Newton,

and taking a very integrated approach to economic development re-
8

covery, including education, entrepreneurs, and other economic

strategies.

This approach recognizes that our greatest assets are the people—the skills, knowledge, and talents that they bring to the process—and fully developing this talent is the key to our successful recovery and a competitive economy in the global market.

The Newton Transformation partners recently secured a planning grant from the Department of Labor’s Regional Innovation

Grants program. Specifically, the planning resources will be used

to conduct comprehensive resource mapping to understand our regional assets, and a SWOT (Strengths, Weaknesses, Opportunities,

and Threats) analysis to understand successful economic and talent

development strategies.

These strategies will then serve as a foundation for the region’s

comprehensive strategic plan that will guide and sustain the region’s transformational efforts.

As I indicated in the beginning of my comments, we know that

our story and the loss of Maytag is not necessarily unique, so

therefore, from our experiences, we believe we can offer you three

recommendations as you look at not only the impacted employees,

but the community as a whole and how to help them be competitive

and reposition themselves: one, help prepare and equip communities and regions from major economic disruptions in advance of

the event if at all possible; two, provide technical assistance to

strengthen formal entities and engage grassroots participation; and

three, provide targeted resources, like the Department of Labor’s

regional innovation grants, to help create strategic and comprehensive plans that engage all the assets of the region and create collaborative partnerships.

Comprehensive plans built on solid strategies will leverage more

resources and ensure true prosperity for the communities and the

regions.

Thank you very much for the opportunity to share the story of

Newton and the surrounding area. I do hope that the story has provided you with additional understanding from a community perspective in what will be useful as you consider the Trade Adjustment Assistance Act and how to assist communities to be competitive in a global economy.

Thank you.

The CHAIRMAN. Thank you, Ms. Didier, very much.

[The prepared statement of Ms. Didier appears in the appendix.]

The CHAIRMAN. We will now go to Ms. McDonald-Pines.

STATEMENT OF JANE McDONALD-PINES, WORKFORCE POLICY

SPECIALIST, AFL–CIO, WASHINGTON, DC

Ms. MCDONALD-PINES. Thank you, Chairman Baucus, Ranking

Member Grassley, and members of the committee for the opportunity to testify on behalf of the AFL–CIO on improving programs

that help workers affected by trade and globalization.

Millions of workers are suffering from the displacement effects of

trade, and the need to help them exists independently of the debate

over our trade policies. We firmly believe that the Federal Government has an obligation to provide retraining, reemployment assist-
9

ance, health care, and income support to workers who lose their

jobs due to Federal trade policies.

I would like to focus on four key recommendations for improving

Trade Adjustment Assistance. First, no worker should be denied

TAA training due to insufficient funds. Help for our laid-off workers has always been modest compared to the benefits of trade. The

U.S. currently spends less than $1 billion on TAA, while it is

claimed that the U.S. economy gains $1 trillion a year from trade.

Funding for TAA training should not be capped. Help for workers

should not be nullified because of limited funding, flawed administration, the State in which the worker happens to live, or when a

layoff occurs.

The current method for distributing TAA funds is deeply flawed

because the formula reflects past, not current, demands. This leads

to two undesirable results: some States experience shortfalls at the

same time other States have unspent funds. Many States seek to

ration training services to keep within the constraints of their base

TAA allocation, shortchanging workers.

The second recommendation is to make TAA available to all

workers displaced by Federal trade policies. The TAA program

must cover the thousands of technology and service sector workers

who find themselves jobless when their employers outsource their

work overseas.

We also must ensure that all secondary workers are served, as

promised in 2002. GAO reports that just 7 percent of workers covered by TAA were secondary workers. However, expanding eligibility without a guarantee of adequate funding is an empty promise.

Our third recommendation is to improve outreach and access to

TAA training. Displaced workers need counseling, yet there are no

funds available in TAA to pay for this help, and funding for programs like the Employment Service has been consistently cut.

GAO points out that in one State, Employment Service funds

were able to pay for only a single case manager who had to cover

three counties and serve approximately 1,000 workers.

Congress should fund outreach and case management through

the State unemployment insurance and employment security agencies. These staff already provide access to UI and TRA benefits and

can provide counseling and job search. Also, the State-wide system

has the flexibility to respond to layoffs as they occur around the

State.

We must improve the Health Coverage Tax Credit. We must increase the premium subsidy to 90 percent, include fall-back coverage and presumptive eligibility, and disregard lapses in coverage

that are not the fault of the worker.

Fourth, we must provide quality training that is linked to the

creation and retention of good jobs. Congress should expand the enrollment deadlines and support training that leads to good jobs, including quality on-the-job training and labor management initiatives that save jobs, improve wages, and make industries more

competitive.

Programs that provide long-term training for dislocated workers

can have positive results. One year of community college, for example, raises displaced workers’ earnings by about 5 percent. A long-
10

term training program for dislocated workers in Washington State

resulted in job placements that averaged 93 percent of pre-layoff

earnings.

We also must consider establishing links between TAA and new

opportunities in energy technology. Already, the renewable energy

industry is experiencing a lack of skilled workers. The Power Alliance, which is a coalition of labor, business, and environmental

groups estimates that 3 million new jobs could be created over the

next 10 years through energy efficiency initiatives.

I would like to briefly address two other issues of concern. The

first is unemployment insurance. We need to restore UI eligibility

to a higher percentage of the workforce, increase benefits, and address under-funding of administration. We support efforts to provide $7.4 billion over 5 years through an extension of the Federal

Unemployment Tax Act (FUTA) surtax to encourage States to modernize their UI programs.

The second is wage insurance. The preceding list of TAA and UI

reforms is the long one: lifting the training cap, extending outreach

and access to training, expanding eligibility, improving health coverage and income support, and repairing the Employment Service

and the unemployment insurance system.

These reforms cost money and it makes no sense to us to divert

funding away from these improvements to pay for expanded wage

insurance. Our improvements are designed to put more workers on

a career path towards good jobs. We are concerned that wage insurance, by contrast, would promote downward economic mobility,

take jobs away from lower-skilled workers, and subsidize low-wage

employers.

Mr. Chairman and members of the committee, we look forward

to the opportunity to work with you on legislation as it moves forward, and thank you again.

The CHAIRMAN. Thank you very much. We appreciate that.

[The prepared statement of Ms. McDonald-Pines appears in the

appendix.]

The CHAIRMAN. Mr. Rosen?

STATEMENT OF HOWARD ROSEN, EXECUTIVE DIRECTOR,

TRADE ADJUSTMENT ASSISTANCE COALITION, WASHINGTON, DC; ACCOMPANIED BY GREG MASTEL, SENIOR ADVISOR, TRADE ADJUSTMENT ASSISTANCE COALITION,

WASHINGTON, DC

Mr. ROSEN. Thank you very much, members of the committee. I

am joined here this morning by Greg Mastel, who is the senior advisor to the Trade Adjustment Assistance Coalition. I think he may

be recognizable to some of you on this committee.

The CHAIRMAN. Indeed. Indeed.

Mr. ROSEN. Indeed.

It is a great honor testifying before you today, Mr. Chairman.

Due to your leadership in 2002, which I experienced personally,

tens of thousands of American workers are receiving assistance

today that they would not have otherwise. Proposals that you and

Senator Bingaman put forward have radically changed the program and improved a bad situation and made it a little bit better.
11

As you and Senator Grassley mentioned, we are at a critical

junction right now. The Trade Adjustment Assistance program authorization expires in September. Again, based on experience, I

would like to make this very clear: a lapse in authorization or a

temporary extension of that authorization could cause havoc and

serious disruption to American workers and their families. We saw

this in the 1990s, and I hope Congress does not repeat that once

again.

As you mentioned, 45 years ago Congress made a commitment to

assist American workers and their families who lose their jobs due

to international trade. Intensification of domestic and international

competition make this commitment even more important today

than ever before.

Assisting these workers, firms, farmers, fishermen, and communities to respond to the pressures of globalization should actually

be at the center of the Nation’s competitiveness strategy, something that I know the Chairman has been championing.

Our competitors understand this. Some European countries devote 5 times more than we do to helping workers adjust to economic pressures. These days, one of the poster boys in this city for

labor market adjustment is the Danish ‘‘Flexcurity’’ system. As a

share of GDP, the Danes spend 5 times more than we do on income

support and 10 times more than we do on training.

I wish to make a few comments. We do not have time right now,

but I hope in the discussion we can go into all of these things in

more detail.

Number one, Trade Adjustment Assistance is not, and should not

be, a substitute for trade policy. Number two, despite criticism that

you might hear in Washington, Trade Adjustment Assistance

works. The problem is, it just doesn’t help enough people.

The Government Accountability Office found that almost half the

applicants denied over the last 5 years were service workers. This

is something that must be corrected. Trade Adjustment Assistance

must address current market conditions, not just the old ones.

Trade Adjustment Assistance is not just a handout. Because of

the reforms that you put forward in 2002, there has been a shift

away from income support to direct flexible assistance, and two of

those kinds of assistance are Wage Insurance and the Health Coverage Tax Credit.

Wage Insurance is not a panacea. Wage Insurance is also not a

substitute for unemployment insurance. On the other hand, I have

interviewed workers in Montana and Iowa and other States around

the country who are currently enrolled in wage insurance. Universally, they tell me that wage insurance did not force them to take

a low-wage job, but it was instrumental in helping them cope with

the fact that those were the only jobs available.

The Health Coverage Tax Credit. Again, the Government Accountability Office found that 70 percent of workers who did not

have insurance could not purchase insurance even with the Health

Coverage Tax Credit because it was too expensive.

The Government Accountability Office calculated that, even with

the credit, maintaining health care would cost about 25 percent of

take-home unemployment insurance on average around the coun-
12

try. It could be more in certain States. The amount of the credit

drastically needs to be increased.

Now, I know that the Chairman and Senator Grassley have questions about administrative costs and the allocation of training

funds. It is much too detailed to get into right now; I hope we can

do that during the questions and answers.

We devote a lot of resources to helping those who lose their jobs,

but very few resources to helping try to prevent job loss. The Trade

Adjustment Assistance program for firms is exactly the way to do

that and has shown that it is successful in keeping jobs. The Urban

Institute finds that about 90 percent of the firms continue to operate and maintain employment. The program needs to be expanded.

The Europeans devote 10 percent of their farm assistance to positive adjustment. By contrast, we spend less than one-tenth of 1

percent of our farm income support on positive adjustment. We

need to correct that.

The new Farmer and Fisherman Program, which Senator Grassley introduced and has been championing, is the best way to do

that. The program is very small right now. We need to build on

that.

As was mentioned already, we are now understanding that communities are paying a heavy price due to economic dislocation. I

would just mention that Ms. Didier’s comments and recommendations were, in fact, part of the 2002 legislation proposed by Senator

Bingaman. I hope Congress will once again consider those recommendations.

All public opinion surveys find that Americans are willing to pursue trade normalization if—and only if—the government assists

those workers, firms and communities adversely affected by liberalization. The liberalization is taking place. We need to keep up our

side of the bargain.

Thank you very much.

The CHAIRMAN. Thank you, Mr. Rosen, very, very much.

[The prepared statement of Mr. Rosen appears in the appendix.]

The CHAIRMAN. Now it is my honor to introduce Ms. Ross. Welcome, again, to the committee.

STATEMENT OF JERRY ANN ROSS, CURRENT PARTICIPANT IN

THE TRADE ADJUSTMENT ASSISTANCE PROGRAM, EUREKA,

MT

Ms. ROSS. Mr. Chairman, Senators, committee members, I come

from Eureka, MT, which is located in the northwest corner of our

beautiful State. It is 7 miles from the Canadian border.

I worked for Owens & Hurst Lumber mill for over 13 years as

a plant supervisor. In the early months of 2005, there was an announcement made that the plant was going to close due to the results of competition from foreign trade, with the uncertainty of

what lay ahead for us in the future: would we be able to find work

in our area? Would it be enough to support our families?

Through the Job Service a Federal program, Trade Adjustment

Assistance, TAA, was offered to the 87 employees who were affected by the layoff. The employees were also issued a grant under

the Northwestern Montana Timber National Emergency Grant,

NEG. The NEG is a grant that provides funds for other needed
13

items that the TAA and the TRA do not cover. The grant is presented by the State of Montana to the U.S. Department of Labor.

The grant is to prove that a specific amount of funding is available

for retraining or supportive services.

I chose the 2-year program with the Building Trades and Accounting Technology at the community college in Kalispell, MT.

The TAA program has provided unemployment benefits and a gas

allotment for the 150 miles I drive daily to attend school. It has

also paid for tuition, books, and any other required material that

I have needed for the classes that I am taking. It has been a dream

come true for me.

The staff at the Job Service has been very exceptionally helpful.

They have taken the time with each worker to explain the options

available. My case worker has been very, very helpful whenever I

have had any questions.

I do have a few suggestions for the TAA and the TRA programs

for improvement. One issue is the time limits. There are time limits set forth to be enrolled in qualified training programs: at the

end of 8 weeks in which the petition is certified, or at the end of

16 weeks after the job separation. A little more time may be needed.

There are limited training facilities in rural Montana, and most

training institutes do not have open enrollment. Students can only

start training at each semester, and not usually within the 8- to

16-week deadline.

Health insurance. Has the Health Coverage Tax Credit, the

HCTC, been working? There needs to be improvement with this

process. Fifty-five percent of the tax credit is not enough. What is

needed is some form of health insurance, either something affordable or some type of insurance for the trainee and their family.

Currently, there is one man, who is a friend of mine, who is in

his 30s. He just finished the program. He graduated last month.

His kidneys are failing. He has no insurance and he has a wife and

two children.

Unemployment and TRA benefits, to make sure that the benefits

do not run out. It would be difficult to finish the training without

the needed funds for financial support. Because of college start

dates, participants cannot start training as soon as they are laid

off. They use their unemployment during the time of waiting,

which means those weeks are not available at the end of the 104

weeks of training.

Child care. There are several young families involved with this

layoff who have small children. While in training, the young men

who are the breadwinners are not bringing home the same amount

of finances into their homes. Child care is still needed while they

are in training.

Rural areas. It is hard for workers in rural areas to access training. The Owens & Hurst workers have to drive at least 100 miles

a day round-trip to attend the closest community college. It would

be nice to have a little more flexibility to pursue legitimate online

opportunities for training.

Half of the Federal per diem, per rate. TAA can only pay 50 percent for the rate for training. ATAA deadline, which also is the

wage insurance. To qualify for ATAA, a worker must obtain quali-
14

fying reemployment within 26 weeks of layoff. This remains true

even if the certification is not issued until after the 26th week has

passed.

There was a Washington employer who did not apply for the

TAA within the 26-week period because he had hoped to start up

again, but because of this his workers were not eligible for the

ATAA wage insurance. The deadline should be 26 weeks of layoff

or petition being approved, whichever is later.

In conclusion, I want to once again thank you for this opportunity to come before you. I have been very grateful for the opportunities that have been presented to me that would not have been

available before.

The CHAIRMAN. Thank you, Ms. Ross, very much. Thank you.

[The prepared statement of Ms. Ross appears in the appendix.]

The CHAIRMAN. I would like to ask you, Dr. Brainard, just generally, your thoughts of what we should do, this country should do,

in response to this large wave of globalization. Alan Blinder has

even suggested about 25 million jobs, service jobs, might be lost

over the next 2 decades on account of globalization. He has written

articles suggesting that we should get a little tougher and stronger,

perhaps, even with our trading partners than we have in the past.

I would just like your general recommendations. What do we do

about this globalization? Then maybe a couple of words about adjustment assistance in the context of what you think the American

response should be.

Dr. BRAINARD. Well, my sense on the new wave of globalization

is that we do not fully understand the scope of it or the scale of

it. I, being bullish on America, have no doubt that over some adjustment period America is going to continue to be at the cutting

edge of the leading industries in the world. So my sense is that

there are already American corporations that are beginning from

all the new opportunities.

The question is, how do we prepare a much larger group of

Americans to take advantage and then create adjustment programs

that are meaningful for those who are going to have to change

their skill sets?

In general, I think there are three areas which comprise a competitiveness strategy. We tend to put them in stove pipes and consider them separately, but the reality is, when you look at something like offshoring, again, it is not something that we could

mandate in a trade agreement. That was just a new wave of globalization.

My sense is, the first thing is investments, infrastructure, innovation, education—proactive. Some of those things take 10 years to

start to yield fruit, but we need to be doing them now, looking forward.

Second is to be tougher about enforcing our trade rules—intellectual property in China is a perfect example—and be tougher about

the trade rules that we negotiate. That is very much the work of

this committee.

And then the third thing is adjustment. We tend to think that

is sort of the lagging piece. But those are the workers who face the

brunt of new waves of globalization first. That is why this hearing

today, I think, is so critical. Unless Americans feel like they have
15

the tools to adjust, I think they are understandably going to be

nervous and resistant.

The CHAIRMAN. I do not know who wants to answer this next

question, but I read an article some months ago—and you, Mr.

Rosen, referred to it—how Denmark contributes so much to worker

retraining, et cetera.

They pay much more attention to those who are either laid off

or have the potential to be laid off, so there’s more of an impression

in that country that you are on the same team, on the same Danish

team. I wonder if any of you, whoever wants to, could address the

degree to which that kind of approach is something we should look

at in this country.

Mr. Rosen?

Mr. ROSEN. One of the frustrations I have is that we always

delve into the discussion of Trade Adjustment Assistance in isolation. Ms. McDonald-Pines, I think appropriately, raised the context

of unemployment insurance.

We have in the United States probably the weakest unemployment insurance system in the entire industrialized world. Only

one-third of unemployed people get unemployment insurance. If

you are lucky enough to get it, you get paid $260 a week, which

is below the minimum wage that Congress has just passed. It is

embarrassing for an industrialized country that our general assistance to people is so weak.

Now you add on top of that what Dr. Brainard and you have suggested, which are the increasing pressures coming from globalization. It is getting harder to disentangle the causes of dislocation.

Now, what other countries have chosen to do—Denmark, other

European countries—is to have very strong general programs. I

will make it very clear: I am not advocating that the United States

spend what European countries spend on their programs. But there

is a big difference between spending 10 times what we do on training and what we currently spend on training.

Two other points. Senator Baucus, you have introduced the concept of a globalization adjustment program. I am actually attracted

to that idea. There is a lot of debate on this issue.

We tend to separate our groups by political pressures and assist

them accordingly, and that is how trade originally got isolated the

way it did. Given the difficulties in trying to identify the causes of

globalization, we may need to rethink this model.

Today it is service workers, immigration, other things. Do we

want to have an immigration adjustment assistance? Of course not.

So maybe doing a globalization program might really encompass all

of that.

The CHAIRMAN. Yes. My time has expired. Ms. Ross, I am going

to ask you a few questions about your experience during the next

round, so you can be getting ready.

Senator Grassley?

Senator GRASSLEY. Yes. Ms. Didier, I agree with your testimony

that highlights the need for communities to be proactive in addressing the realities of a globalized economy.

For example, I helped, through Federal grants, the Iowa State

Education Association establish a program to educate students on

the role of international trade in the U.S. economy.
16

The Association is teaching many students and teachers about

international trade and how the global marketplace affects their

daily lives. While it started in the Des Moines area, the Association

is expanding the program.

I hope that this program will help prepare our future workers in

Des Moines, and across Iowa, to capitalize on the opportunities presented by a globalized economy.

Ms. Didier, once again I thank you for appearing. We talked

about the Maytag facility being closed. It was certified for Trade

Adjustment Assistance, I think, on three separate occasions: 2003,

2004, and 2006.

As a result of those certifications, there has been, I am told, 633

participants in the program, with about $5 million in benefits. That

translates into an average of about $7,800 per worker, with many

former Maytag workers enrolled in community colleges for retraining.

How important have the Trade Adjustment Assistance programs

been in helping former Maytag workers and the Newton community as a whole to recover from the loss of Maytag jobs?

Ms. DIDIER. Thank you, Senator Grassley. I think it has been a

key component in our ability to actually sustain our community. I

mentioned May 10 of last year somewhat being a mark in time of

the actual departure of Maytag, but the decline of the Maytag organization is a story that has been happening over time. That is why

you see there are two prior awards of the TAA, the most recent in

2006, which is related to the actual departure.

It has been very important to sustain the community and to actually meet some community needs. For example, across our community we had recognized that there was a lack of nurses and

nurse practitioners within our medical system. Our hospital and

our Des Moines Area Community College had worked together to

put a program in place right in Newton.

What we have seen is that many of the impacted employees who

are receiving the TAA adjustment dollars are actually choosing to

use this program to then find a different career path and then fulfill that community need that we have for skilled nurses and

skilled nurse practitioners.

So it has been a very important component of meeting the employment and workforce needs of our existing businesses and institutions and retraining those skilled individuals into those areas

that our other existing businesses need.

Senator GRASSLEY. I suppose there is still a lot of heartache

there, but I followed some of this through the Iowa press, particularly the Des Moines Register, and it seems like they painted a fairly positive view about how some people see this as a challenge as

opposed to a problem, and are willing to bite the bullet and move

on in the community as a whole. So, I compliment you and the

community for your work.

In addition, for you as well, could you expand a bit on the regional innovation grant that Newton obtained from the Labor Department? Was it a difficult process to obtain the grant? What

amount of accountability is there? In other words, what is Newton

required to report back to Labor with respect to how the grant was

used?
17

Ms. DIDIER. I would be happy to answer that. Actually, there is

a bit of a story, if you do not mind me telling this. Last September,

September 14, there were a number of Federal officials who came

to Newton that Senator Grassley had organized for us to kind of

tell the story about what Newton was doing in light of the announcement that happened in May.

We presented the approach that we were taking, very much as

I described in my comments. But we made one request, and that

was the fact that we needed some resources to really be strategic

about our response.

We had some immediate responses that were more reactive that

were necessary, but yet to really position our community and the

whole region to be sustainable and become competitive in a global

economy, we knew we needed to be strategic and put a plan together.

The Department of Labor understood what we were doing and

actually related it to several principles that they were using within

their own programs, and they have been working with us ever

since September.

Obtaining the Regional Innovation Grant was very simple. We

worked very closely with the staff at the Department of Labor and

received that by March of this year. It has been a great impetus

for us to strengthen our collaboration among the region and move

towards developing this planning grant.

We do know what our accountability is—they have been very

clear about that—that we have our implementation plan ready

within less than a year of receiving those grant dollars. Then that

implementation plan becomes, really, our road map of growing the

community and sustaining it through this transformation, and

making it competitive within the global economy.

The CHAIRMAN. Thanks, Senator Grassley, very much.

Senator Bingaman, you are next on the early bird list here.

Senator BINGAMAN. Thank you very much. Thanks for having the

hearing, and thanks to all the witnesses for your excellent testimony.

On the issue of these TAA funds for training, Ms. McDonaldPines, I understand that your basic points are that we are providing too little funding for training by having a cap on it, and also

that this system we have for distributing the funds results in

States doing what you call self-rationing; because they do not know

how much they are going to have, they keep it until the end of the

year.

If we were to take your suggestions on the training part of this

and take the cap off so that this was an entitlement that was not

in any way limited, and we were to fix this problem in the way the

funds are allocated—and again, I guess your suggestion there is

that one solution would be to model the system.

You say, model the system for distributing TAA training funds

to the States after the system for distributing unemployment insurance State administrative grants. So if we did those two things,

what costs are we looking at?

Ms. MCDONALD-PINES. Senator, we have not costed it out. I think

if you take a look at the current per capita cost of an individual

in TAA training, I believe it is somewhere between $15,000 and
18

$20,000, depending on the nature of training and the income support, because income support is tied to, as Howard said, the unemployment insurance benefit.

So, in some States where there are more generous unemployment

insurance benefits the costs would be higher than in States where

there are lower unemployment insurance benefits. But we do believe quite strongly that that investment is worth it.

The data shows that individuals who stay in longer-term training

have increased earnings, are able to retain their pre-layoff earnings, so we think that that is an investment worth making.

The suggestion around modeling it on the unemployment insurance system is to create a system where every State gets, if you

will, a base allocation, but there is a contingency reserve that is

available to meet fluctuating demands.

Right now, the Labor Department holds back on TAA training

funds and they typically, according to GAO, have waited until the

end of the fiscal year to distribute those training funds, which of

course results in the States self-rationing the training that they

have through their base allocation.

We are suggesting essentially a base for all the States, but a contingency reserve that, again, as States need it, becomes available

on an immediate basis so they do not have to tell a worker, you

have to wait until September to get into a training program, or, we

do not have any money, you will have to wait until next year. So

in our view, it makes sense to make those kind of changes.

Senator BINGAMAN. Let me ask, Howard, if you have any

thoughts on those two recommendations, what the result would be.

The memo we have here from staff says that there are about

36,000 people who received training in 2006 under this program.

Is there any way to estimate how many people that would be expanded to if we took the suggestions that are being made here and

took the cap off and did this other way of distributing the funds?

Mr. ROSEN. Thank you very much, Senator Bingaman. First of

all, let me make it very clear: there is no perfect way to do this.

This is very difficult. So, no one should interpret this as some kind

of criticism, that people are doing it wrong. We have to be willing

to be flexible and try different things.

Many progressive States are going to the community colleges,

which tend to be the vehicles for much of the training, and asking,

what is the average cost for a 2-year program?

I spoke to the TAA coordinator in Iowa yesterday, and she told me that it is $15,000 for training. Now, that is a lot more than

what Ms. McDonald-Pines just said, because she put together the

training and the income payments.

So in small States, in States where there is a small amount of

enrollment in these programs, they can pay more for their training.

And, in fact, in Iowa and in Montana, some of that training money

is used for travel. So we have different situations in different

States. I believe that we do not want to get into a situation where

we put a universal cap on training.

Senator BINGAMAN. We have that now, do we not?

Mr. ROSEN. We do not. We allow each of the States to figure it

out based on the amount of money.

Senator BINGAMAN. Well, what is this $225 million cap?
19

Mr. ROSEN. That is a universal on the total 50 States. But I do

not want it to be a maximum for each person.

Senator BINGAMAN. Oh. Right. All right. I understand.

Mr. ROSEN. You do not want to put a maximum on each person.

That is what we do under WIA, and I think it is a complete failure.

Senator BINGAMAN. Right. So we should avoid that.

Mr. ROSEN. On the other hand, we want to give the States the

flexibility to figure it out; some States pay for transportation and

things like that.

So what I have argued is, we at least have to keep the training

cap up with inflation and up with total demand. To answer your

question specifically, we know how many waivers are given because

there is no money for training.

But I have to say, over the last year my emphasis has shifted

from the squeeze due to the cap to the problems with allocation.

It appears that that is really where the problem is, although I believe that the cap needs to be increased on a regular basis to keep

up with demand and inflation. You increased the cap in 2002, and

it had not been increased for 10 years. Well, we cannot have it that

way, so I think we need to do a little bit of both.

And let me just say that the allocation process is done through

regulations, it is not done through legislation. So, the Department

of Labor has complete discretion on how they do that, and that is

a problem.

Senator BINGAMAN. So we really ought to have the Department

of Labor in here explaining why they do not change this.

Mr. ROSEN. And let me just say, since you raised that, Senator

Bingaman, that the Department of Labor has not yet issued regulations on the 2002 changes. It has been 5 years and we have not

seen final regulations on these, so we cannot comment on what

they are doing.

Senator BINGAMAN. Thank you, Mr. Chairman.

The CHAIRMAN. Thank you, Senator.

Next, is Senator Bunning.

Senator BUNNING. Thank you, Mr. Chairman.

This is for everyone at the table, all the witnesses. Some of you

have discussed the need to vastly expand our trade assistance programs so that they pay nearly all health insurance costs and extend unemployment insurance for workers in nearly every industry, even when there is no direct connection to a trade agreement.

I am not sure I agree with that approach, but I do appreciate the

value of TAA training, when properly administered.

For example, in 1998, Fruit of the Loom moved about 5,000 jobs

to El Salvador. Campbellsville, KY lost a 50-year-old plant that employed almost 5,000 employees. Today, Campbellsville has bounced

back very nicely, thanks, in part, to TAA.

I am pleased to say that I helped to make sure that these workers received training at Lindsey Wilson College and Campbellsville

University. Soon after the closing, employers like Amazon.com

moved to Campbellsville. Today, the town has erased all of its 1998

losses and gained more than 600 additional jobs.

What changes could we make to TAA to improve the likelihood

of similar success stories in the rest of this country?
20

Mr. ROSEN. I am just going to say one word, and then I will let

Jane say it, which is: early intervention.

Senator BUNNING. This was early. Immediately.

Mr. ROSEN. Well, actually, I would argue even before the layoff.

Senator BUNNING. Well, that would be wonderful, but we did not

know they were going.

Mr. ROSEN. But certainly the firm knew where things were

going. If there was more communication——

Senator BUNNING. It is strange, but the firm’s main office stayed

in Bowling Green, KY, and the production part of it all left for El

Salvador.

Mr. ROSEN. Right. Well, let me just say that I believe that the

rapid response system in this country is probably the most important labor market adjustment program we have, and it is the least

functional.

Senator BUNNING. Both of those schools—one was a 2-year college, Campbellsville University, which then became a 4-year university, and Lindsey Wilson—are 4-year universities.

Mr. ROSEN. Let us just take that as an example. You get a large

closing in a community like you mentioned, the community college

may not even have enough tables and chairs for the students. The

whole infrastructure needs to be prepared, and the earlier we know

about this stuff the more we can prepare.

May I just give you a small example? I mean, obviously there is

a lot more.

Senator BUNNING. There are some others.

Ms. MCDONALD-PINES. Well, it seems to me, in keeping with

Howard’s discussion, certainly strengthening early intervention

through strengthening the Worker Adjustment and Retraining Notification (WARN) notice so that workers do have as much advance

notice as possible prior to a layoff, through rapid response, through

the unemployment insurance system, marshalling all the resources

in that community and the funds that are available to help those

workers make that adjustment, and a community adjustment strategy that looks at, as Ms. Didier described, the available opportunities within that community that help link workers with the available skills and jobs that are growing.

It also seems to me that TAA training need not be necessarily

classroom-based. There is authority in TAA to provide funds for onthe-job training and customized training with employers. We certainly think that is an option and an alternative to Wage Insurance.

The data that I have, the latest data from the Labor Department,

shows that about 2 percent of workers are enrolled in TAA on-thejob training. So, it seems to me we not only want to think about

classroom training, but for workers for whom returning to a classroom is not an option or not practical.

Senator BUNNING. I have one more question I would like to get

in while I have my time, and it is for you. In your testimony you

complained about the cap on TAA training funds, and even suggested that we should follow the lead of Denmark, a country that

spends 7 percent of its GDP on unemployment assistance and labor

market programs.
21

If we spent a similar percentage of our GDP, it would amount to approximately $925 billion per year in spending. How do you

propose we raise the additional $1 trillion per year in taxes?

Ms. MCDONALD-PINES. Well, we would love to talk to you about

ways in which we think we can connect financing mechanisms and

the ways in which our country benefits from trade. The data that

we presented in our testimony shows that the benefit to the U.S.

economy is about $1 trillion in trade, and yet we spend less than

$1 billion in TAA.

We have to figure out a way to provide the resources necessary

so that workers can make the adjustment. I think there are options. We would be happy to talk to you about ways of financing

those programs through the benefits that our country, again, generates from trade.

Senator BUNNING. Well, there are some of us here on this committee who might disagree with you slightly on that. Thank you.

The CHAIRMAN. Thank you, Senator Bunning.

Dr. BRAINARD. Could I quickly just respond to Senator Bunning

on your first question? You asked what works best, and you also

asked, why should we generalize this out so that it is not narrowly

tied to a trade agreement. Those two things, in my mind, are completely integrally related.

Early response and community-wide strategic responses are the

critical components of successful adjustment. They will not happen

if the eligibility process is so cumbersome that you need to make

a connection to a trade agreement, and you lose weeks and weeks

trying to do that. So, I do think these things are very closely connected. Thank you.

Senator BUNNING. Thank you.

The CHAIRMAN. Thank you very much.

Senator Cantwell? According to my early bird list, you are next,

Senator. The two of you can decide who wants to go first.

Senator CANTWELL. I think my colleague actually came in first.

Senator GRASSLEY. You only have 4 minutes left now. [Laughter.]

Senator CANTWELL. Thank you. I am sure I could take all 4 of

those minutes.

But let me just say, I thank the panelists, and particularly Ms.

Ross, for being here, because I think oftentimes we hear about

these policies, but you help put a picture to what it is really like

in a small community to struggle with the balance of challenges in

trade when it may mean the entire community goes under without

the resources. So, thank you for traveling all this way. And to all

the panelists, I thought you did a fabulous job.

Washington State, I think, has probably had a more intimate relationship with TAA than just about any other State in the Union.

Once, when calling somebody over at the Department of Labor,

they said, we do not know if we should approve your TAA application because you use more funds than anybody else in the country.

I assured them that that was an unpleasant distinction, that the

fact that we have been a natural resource-based economy with fishing and timber, and seeing significant downturns in those industries, some as a result of Federal legislation, and that the aerospace industry at one point in time went from 100,000 employees

down to 35,000 employees, triggering somebody to put a billboard
22

outside of Seattle saying, ‘‘Will the last person leaving Seattle

please turn out the lights.’’ The defense industry, the aluminum industry—I could go on and on with our history of dislocation and

TAA.

So I am a big believer in putting TAA on steroids, if you will.

I think each of you articulated two particular problems, the fact

that we need to increase access to TAA and the flexibility of the

program. I agree with your testimony.

My question is, if we are facing such a mound of demand and

such a challenge in keeping pace, as Senator Bunning was saying

about being prepared before you know the eventuality, how do you

balance your testimony about wage insurance or a program, what

I call lifelong learning accounts?

Senator Snowe and I have been working on something that

would say, let us incent both employers and employees for paying

into a lifelong learning account, which would then become the way

an employee would protect themselves on being retrained in the future.

So my question is, to what degree do you think that we should

look at TAA as the basis for a much broader access, or do you think

that we should keep TAA, make it more flexible, but think more

broadly about the mound of demand that we are facing given

globalization?

Mr. ROSEN. Can I just start? I try to speak to TAA coordinators

throughout the country, and I know not to be too selective when

you are talking to Congress, but I have spoken to your TAA coordinator, I have spoken to Montana and to Iowa, and you should be

very proud of the people that you have working on this.

The CHAIRMAN. Is that by design?

Mr. ROSEN. Sorry?

The CHAIRMAN. Is that by design?

Mr. ROSEN. Yes. [Laughter.] I testified before Congressman

McDermott last month. I have to say, probably one of the reasons

why your spending in Washington is high is because your TAA coordinator is so incredible, and he is really doing a lot of outreach.

That brings me to my next point, which is——

Senator CANTWELL. Well, but I would also add, just so somebody

does not think it is just about being aggressive, we have had significant industry downturns.

Mr. ROSEN. Oh, of course.

Senator CANTWELL. The fortunate thing for us is, we also have

the up side, with biotechnology, with software, with new emerging

industries, so we have matched people very well.

Mr. ROSEN. I could show you States that have that much demand

and the infrastructure is not helping those people. So that is number one. Number two, to your point explicitly, I believe that TAA

should be the model for what we do.

Again, I want to make it very clear, that does not mean that I

am saying that we should provide all TAA resources to everyone

in this country. What I am saying is, it is the one that we provide

so much attention to, so it really should be the model.

Senator CANTWELL. So you would say, grow TAA?

Mr. ROSEN. Definitely I would grow TAA, but I would——
23

Senator CANTWELL. No. But I am saying, as the principal program for addressing——

Mr. ROSEN. For example, let us put in place Wage Insurance for

all unemployed people. Let us put in place a health coverage tax

credit for all unemployed people. Why just for trade-related people?

So, we should try things out in TAA and then use them, when appropriate, for other workers.

Senator CANTWELL. Ms. McDonald-Pines?

Ms. MCDONALD-PINES. I guess I would like to address the comment you made about lifelong learning accounts. We have some

real concerns about private accounts for programs, ranging from

health care, obviously, to pensions, and now to learning, because

very often the only people who are able to contribute to those accounts are individuals who already have resources.

For unemployed workers who are trying to pay bills with their

unemployment insurance check, or even low-wage workers who are

very often the victims of these layoffs, it is very hard for them to

set aside any resources for basic health care and pension, never

mind lifelong learning accounts. So, that needs to be a separate

conversation.

In terms of TAA, you know, you used the term ‘‘TAA on steroids.’’

I think that that is really important. One of the things that, again,

GAO pointed out and certainly we are seeing from our experience

in the field, is that there is a real gap between the workers who

are eligible for TAA and how they find out about it.

TAA, right now, cannot pay for case management, counseling,

and outreach, so the States are faced with cobbling together the resources that they have to help pay for that. As a consequence,

workers do have a hard time knowing about the program, getting

into the program, and being supported while they are in the program.

So, certainly, it seems to me, one of the major improvements in

TAA needs to be expanding case management and providing that

counseling to workers, at which, again, Washington State does a

terrific job.

Ms. DIDIER. I would just make a quick comment. I am not as

versed as some of the other witnesses here on all the technicalities

of TAA, but I would say to you that what we recommended and

what the Department has done with the Regional Innovation

Grant, and also what they have done through their Workforce Innovation and Regional Economic Development movement are the

kinds of things and principles that we are suggesting are what are

helpful for communities.

I would suggest, perhaps in the community that the Senator was

talking about with the loss of Fruit of the Loom, that many of

those same principles probably applied and we should look at why

they were able to switch that as quickly. So I think there are some

programs already out there helping, and trying to help, with the

communities. It is just expanding those.

The CHAIRMAN. Thank you, Senator, very much.

Senator CANTWELL. Could Dr. Brainard just answer? Or if you do

not want to——

The CHAIRMAN. No, no. That is fine.

Dr. BRAINARD. I will talk quickly.
24

The CHAIRMAN. You have an additional minute.

Dr. BRAINARD. I think if you are thinking really proactively and

kind of into the future about our competitiveness, that is the question. I mean, the list of industries you went through, some of that

is trade, some of it is changes in regulations, and think about

changes in technology.

Why is a trade-affected worker kind of more deserving? And if

we look at the numbers of permanently dislocated workers who go

into jobs where they suffer earnings losses, 33 percent, on average,

and that is across all industries.

But the reality is, you have political support for the Trade Adjustment Assistance programs, so ideally this would be kind of the

incubator, the state-of-the-art programs. You observe them closely.

If they work well, you kind of roll them out more broadly. That

would be, I think, the ideal model for TAA.

Senator CANTWELL. Thank you, Mr. Chairman.

The CHAIRMAN. I believe are next, Senator Lincoln.

Senator LINCOLN. Thank you, Mr. Chairman. Thank you so much

for again having such a valuable hearing for all of us. As we hear

these stories, we certainly reflect back on our own communities,

our own States. I know when I came to Congress in 1992, I had

six shirt factories which I quickly lost in, I think, the first two

years I was in the House. I had four shoe factories, Levi Strauss,

Maytag, as well as so many of the others that have been mentioned. And it does devastate these communities.

I would just like to say, Dr. Brainard, your comment about timing, as you followed up with the Senator from Kentucky, how important that is, that they do not spend all of that time trying to

figure out how they are going to get folks into programs and doing

things, because that kind of time that is lost is valuable and those

workers are living, in those weeks, without the resources that they

need. The further behind they get, the harder it is to catch up.

I think a lot of that has to go to what you were talking about

in terms of what is not covered by TAA: the case management, the

counseling, the outreach, and the things that are so important

about getting information to these workers about where their support is and what their options are. They are devastated. When you

go to those places and you see those people, they are devastated.

Just making that first step is so important.

Ms. Ross, we want to thank you for bringing a real face on the

issue to us. That is critically important inside the Beltway. We

have wonderful resources and people who provide us great information, but when there is a real face on the issue it makes a whole

difference in terms of where we are going and what we are doing.

I was particularly interested in your comments about the challenges facing rural Americans, representing a predominantly rural

State, and their ability to fully maximize the benefits that are provided by the TAA program.

Hopefully you might elaborate a little bit on the unique circumstances for individuals facing unemployment in rural areas. An

example you used, you mentioned online training opportunities for

those who are living in remote areas, and you seemed to express,

I think, some concern about the legitimacy of what is currently

available in that regard, whether it is the online availability or
25

whether it is just whether or not those communities are hooked up.

We are having a field hearing in Arkansas on the availability of

broadband in some of those communities and how we might improve some of those services.

Ms. ROSS. Currently, with the online training, they are limited

in what is acceptable. You have to be able to be in contact with the

school and you need to go to the school periodically to visit with

the instructors and/or for testing.

Senator LINCOLN. So you still have to travel?

Ms. ROSS. Yes, you do.

Senator LINCOLN. And, of course, with the price of gasoline right

now, it is unbelievable in terms of that 100 or 150 miles round trip

that you are making.

Ms. ROSS. Yes. Every day.

Senator LINCOLN. Well, we see that with everybody, quite frankly. It is awful. We do not even reimburse our veterans when they

have to travel to the veterans hospitals to the extent that we do

our staff on a Federal reimbursement.

So I think that is a real important point that differentiates just

a little bit in rural America, are those issues of accessibility. I

know we used some Labor money to build or retrofit a motor home

with a computer lab which we could then take out into the community, which was very helpful when we saw one of our plant closings, and it was really helpful in retraining.

But we had difficulty in being able to get those dollars from the

Federal side. We had to really push hard on the State side and

then match some of it with some Federal dollars. But those are

good points, and we appreciate it.

Ms. McDonald-Pines, maybe you might elaborate, too, on why, in

your view, the Workforce Investment Act fund should not be relied

on to provide case management services and why reliable funding

streams for these services are separate from the Workforce Investment, so important to workers? I guess particularly in situations

where there has been a significant layoff.

Ms. MCDONALD-PINES. Well, you did mention, and I guess a

number of the panelists have mentioned, the problems that workers have getting timely access to these programs.

Senator LINCOLN. Right.

Ms. MCDONALD-PINES. And in our view, the first point of contact

that most workers who lose their jobs have is with the unemployment insurance system——

Senator LINCOLN. Yes.

Ms. MCDONALD-PINES [continuing]. And the Employment Service

which is attached to the unemployment insurance system, which is

designed to help find workers jobs and connect them with employers.

And because of cuts in administrative support for both the Employment Service and for the UI system, for the most part, when

you apply for unemployment insurance now you either pick up the

phone or go on the Internet.

We think that system needs to be fully funded and expanded so

that there are staff there who can help a worker, once they, again,

approach the unemployment insurance system with information,

case management, and counseling about the opportunities that are
26

available to them, both through the Workforce Investment Act and

through the Trade Adjustment Assistance Act.

That way you get at the issue of timeliness, again, because most

workers will apply for unemployment insurance shortly after a layoff, and in the case of State Rapid Response, the State tries to

bring in the unemployment insurance system right away during a

closing.

So we really think that is the first point of contact. We need to

expand the professional staff within that system to help guide

workers to their options, be they another job, training, or the like.

That is really where we see the emphasis on the need to provide

case management and counseling. I think, again, GAO pointed out

in one example that there was just enough money, through the

State Employment Service in one State, one counselor had three

counties and had 1,000 people in their caseload.

Well, you are not going to be able to guide people through the

process unless you have staff. Workers need help in making decisions about their careers and their futures and what is going to

happen, and you really cannot get that from a computer. You really

do need somebody counseling.

The CHAIRMAN. Thank you, Senator. Thank you very, very much.

Senator Snowe?

Senator SNOWE. Thank you, Mr. Chairman. And, first, I want to

join you and Senator Grassley in expressing my profound loss,

along with all of our colleagues in the Senate, in the loss of Craig

Thomas, with whom I served for 17 years, both starting in the

House of Representatives, and then we were in the same class here

when we were elected to the U.S. Senate in 1994.

I think anybody who knew Craig, as we all did here on the committee, and his service throughout his career, he was true to his

core beliefs and unshakable in his values that he drew from his beloved State of Wyoming, and he will be dearly missed.

I want to thank all of you very much for your testimony here

today on a critically important program, certainly to my State and

to the country. We received a number of job losses and we have

been devastated in our State.

I have heard what you said, Ms. Ross, regarding the lumber industry in Montana. The same has been true, unfortunately, repeatedly in the State of Maine, and most recently in February we lost

a furniture manufacturing industry that had been a hallmark in

the State of Maine, Moosehead Manufacturing, for decades.

We have lost 26 percent of our manufacturing jobs in the State

of Maine. In a rural State, that is a horrendous impact on the rural

communities, the workers, and their families.

That is the first question I would like to raise with respect to

Trade Adjustment Assistance and having a community support program. Mr. Rosen, I know that you mentioned it in your testimony

as well. I think it is important, and I would like to know if you

have had difference experiences.

But one of the issues that we face in Maine is the fact that we

give the Trade Adjustment Assistance, but there are no jobs to go

to, especially in rural communities where whole communities are

devastated because of the loss of the lumber and logging industries,

which, as I said, with 17,000 jobs that have been lost over the last
27

7 to 8 years, you can imagine what it has done to these communities and affected them disproportionately.

So how would you regard a community support program at this

time, and how would we go about it? I will start with you, Mr.

Rosen, and then Ms. McDonald-Pines and Ms. Didier as well.

Mr. ROSEN. First thing, I just want to add one thing to the last

question, which is, there is no line item in WIA for administrative

costs already, and the number that they have been given for WIA

is declining. So to say that we want to put more responsibility onto

WIA administration funds, I do not know where that is going to

come from.

To your question, I spent some time and I actually went down

to a community and lived with a community during a very large

closing, and this is what I learned. I learned that this is a great

country that has a lot of different individual programs out there,

and a lot of people do not know about them.

So while I get criticized as being someone who wants to build

things, I think the first thing we need to do is know what programs

we have out there—like, I just learned about this program to get

a grant for a mobile lab—and let people know about these things.

So that is the first thing we need to do, is to coordinate all of the

assistance programs that we already have and let people take advantage of them.

Number two, this has been on the books since 1974, believe it or

not, which is that the Department of Defense has an excellent program on economic adjustment for communities with base closings.

Back to 1974, Congress was saying we should use that as a model,

and that model was very much what Ms. Didier said this morning,

which is to get some money for a strategic plan, bring in technical

assistance, help navigate and find out where these resources are.

So what I am saying to you is, I do not think we have to recreate

anything. We have something already and we need to just borrow

from it. So, I think we know what to do, we are just not doing it.

Senator SNOWE. Well, that is an interesting point about the base

closures. Regrettably, I am intimately familiar with that process as

well. But that is important. Maybe we ought to use that as a

model.

Ms. Didier?

Ms. DIDIER. Yes. I would agree. In fact, as we were going

through this process and really assessing what we needed, that is

the model that we went to and came up with and thought about.

In fact, I think that is part of some of our interactions with the

Department of Labor and some folks who are working on BRAC

and using a similar model. So, I would agree that that is part of

it.

I would also agree, though, once the community has been able to

access those resources, we need to really define what they want to

become and what skill sets exist within the impacted employees

and where they want to go for their training, a coordination of understanding what all those programs are, and the liaison—which I

know the Department of Labor has been trying to do.

I know, when they were helping us with the Regional Innovation

Grant, once you have that plan, then you know which programs to

go to and say, here is where our gap is. So, this is why it is appro-
28

priate to go to the Department of Commerce, because they have a

program that helps fit the gap once we have already done our determination within the community.

I think it is very important that any program that we are doing

has to rise out of the community, in the sense of, they have to be

self-determinant about what their future is, what their vision is,

and how they help their employers and then match up with the

skill sets within their employees. So, I do agree that the BRAC

model is very similar and it is probably the model we should look

at.

Senator SNOWE. Well, that is very helpful.

Does anyone else want to comment?

Ms. MCDONALD-PINES. Our unions have had a lot of experience

with the BRAC model, and in my testimony I also talk about labor

management initiatives in sectors like manufacturing, health care,

and hospitality that are really looking at how to retain jobs in the

community and how to deal with adjustment and create good jobs

addressing the sector needs.

I also mentioned in my testimony the new opportunities we see

in the kind of nascent energy efficiency area, where we are going

to embark on a set of renewable energy and energy efficiency initiatives that would mean new skills and new job opportunities for

workers.

Pennsylvania’s Governor Rendell has created a program that

uses the State energy portfolio standards to incentivize the development and manufacture of wind turbines that essentially have

taken an old steel mill and, instead of producing steel, they are

now producing wind turbines and creating good jobs for workers.

So it seems to me that those are opportunities that we have,

again, by coordinating the multiplicity of efforts, but we have to

recognize that bringing those efforts to scale is also going to require

some additional funding.

Senator SNOWE. All right. Thank you.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you, Senator Snowe.

All right. Ms. Ross, you know better than I, certainly, just the

devastating impacts of all the mill closures in Montana.

Ms. ROSS. Yes, sir.

The CHAIRMAN. And I am sure the same is true in the State of

Maine, as well as other States. I mean, it is devastating, the number of communities in our State that had a drastic layoff or had

to shut down, close up. Your mill that you worked at, Owens Hurst,

is just one example of many.

Shutdowns are due to lots of factors. It is changes in technology,

it is globalization, but also Canadian lumber, subsidized Canadian

lumber which has just flooded American markets very unfairly.

Ms. ROSS. Yes.

The CHAIRMAN. It took 20 years to finally get an agreement with

Canada, but even that is not sufficient. As you know, some of the

problem is, they are just starting to get around to that national

agreement. But that is another issue.

Your question is, if you could tell us what you and your fellow

workers went through as you began to reorder your lives and the
29

degree to which this program was a big help, or a partial help, and

how you found out about it.

And then as you describe it, if you could tell us several ideas on

how we can improve. You have mentioned some of the rural problems that we have in some parts of our country, but if you could

also just go through some of the ways that you say, this is all right,

but it sure could have been done a lot better.

You also mentioned a little bit about the unemployment insurance not being coincident with some of the benefits, and there was

not enough time to sign up, et cetera.

If you could go through a little bit and just talk about yourself

and talk about your fellow employees and all that you went

through.

Ms. ROSS. All right. We live in a small community. I hear these

other folks talking about larger layoffs. Our community only has

2,000 people in it. With almost 100 employees, that is quite a bit

impact on our small area. I think it affected our community more

so than it even did us as employees because of the money that we

bring into our area.

The business owners were devastated, and several of them

thought they would end up going out of business. If we were not

able to find employment, then they would not have employment. It

is a domino effect.

I am not sure I remembered all the questions you asked.

The CHAIRMAN. Well, that is all right. That is fine.

Do you know how easy or difficult it was for the company to get

certified?

Ms. ROSS. That part, I do not know. But I know the company did

take care of that for us. I had never heard of the—well, I had actually, but I was not familiar with it. I have a daughter whose husband and herself had a logging business, and I believe in 2001 they

went out of business for the same reasons. She also went through

the TAA program to receive her schooling for a 2-year program.

At that time it was only for 18 months. Unemployment went out

at 18 months. Her education, paying for that, went out within 18

months. The next 6 months, it was difficult to get her training and

to be able to be self-supportive. I am grateful for at least the extended 104-week period at this time.

I know for myself, I was laid off in November. Being we are in

a rural area, and I went to school at the Flathead Valley Community College, the semester did not start until the middle of January. So it was almost 2 months before my training could start, and

I will finish up in December, so I will be without benefits for a period of time before I am finished.

That is what I was looking at for the extension of that, some sort

of extension to allow us to finish school. I mean, I will finish school

anyway, but to have those benefits still be there until we are finished with school, and even perhaps until we are able to get a job,

I do not know how long that would take afterwards.

The CHAIRMAN. Could you tell us a little bit about your health

insurance that you now have?

Ms. ROSS. I do not carry health insurance. My husband does.

The CHAIRMAN. And what does he do?
30

Ms. ROSS. He works for Plum Creek Timber Industry, which is

still shaky, too.

The CHAIRMAN. Right. Very shaky. That is right. That is another

issue.

Ms. ROSS. But I do know that people who have not had health

insurance, like this one gentleman I spoke about who is having

these health issues, who starts dialysis—I think he did last week—

he has no insurance and he still has a family to support. Not that

that is going to make him well, but the insurance part would help

ease this process for him.

The CHAIRMAN. Right. Among those people who did not have a

spouse who have insurance, what do they do?

Ms. ROSS. They do not have insurance.

The CHAIRMAN. And are they participating in TAA, Trade Adjustment Assistance?

Ms. ROSS. Some of them, yes. Yes, sir, they are.

The CHAIRMAN. So what level of insurance do you think makes

sense? I mean, I think Ms. McDonald-Pines suggested that Uncle

Sam should provide 90 percent, that is, about a 10 percent contribution by the individual. Does that make sense? Right now it is

35 percent.

Ms. ROSS. It would make more sense than the 35 percent. Yes,

I agree.

The CHAIRMAN. I think it would, too.

Does that make a real difference, do you think?

Ms. ROSS. I believe so. I believe so. Even with unemployment

benefits, they are not a large amount. They are enough to substantiate yourself while you are in training. But there were several

young families in our mill where the men were laid off, and that

is a large impact on their finances.

The CHAIRMAN. What about wage insurance? Is there an appropriate role for wage insurance, do you think, here?

Ms. ROSS. I am not really familiar with how that works, but I

think it is appropriate, yes. I know we had a couple of gentlemen

who did take that role as they were older and getting close to retirement, and for them that was a wonderful option. I was even in

that age group that I would qualify for that, but I chose the training instead because I wanted to do something bigger and better

than just get by.

The CHAIRMAN. Well, good for you.

And so how many people do you think would be more inclined

to seek training and assistance if training were available as opposed to taking wage insurance, even if wage insurance is available?

Ms. ROSS. I am sorry. Rephrase that.

The CHAIRMAN. Say both training and wage insurance are available to people who are laid off, and let us say they are both available in a pretty significant amount. How many people would follow

your example, that is, to forego wage insurance because you want

to get a better job? That is, not take the easy way out, but take

the more challenging way, which also creates more opportunities?

Ms. ROSS. That would depend upon the individual. I know a lot

of people would have taken it had they been more eligible for the

wage insurance that did not want to go to school or seek retraining.
31

The CHAIRMAN. And what age would they be, roughly?

Ms. ROSS. Thirties, forties.

The CHAIRMAN. Thirties. And they still did not want retraining.

Now, that is interesting.

Ms. ROSS. I know. I did not understand. I was a supervisor at

the plant where I worked, and I talked with several of them to encourage them to do something more. This is a chance to do something better with their lives, not only for themselves, but for their

families. Two years is nothing.

The CHAIRMAN. And what did they say in response to your entreaties?

Ms. ROSS. Some did not want to travel the distance for 2 years.

I said, it is only 2 years. That is nothing in the overall respect of

the rest of our lives. I am one of the older ones, and for me it was

not even an option. I just took that. I mean, for me, that was what

I wanted to do. I know some did not want to do schooling and

would have opted for the wage if it would have been there.

The CHAIRMAN. Now, if they did not have to travel, many of

them still did not want to do schooling?

Ms. ROSS. I am sorry?

The CHAIRMAN. Assuming that travel is not a problem, let us say

the school is right there, next door.

Ms. ROSS. Some were not wanting to go back to school. They did

not like it the first time. [Laughter.]

The CHAIRMAN. I’ll bet they didn’t. All right.

Now, how did you learn about TAA?

Ms. ROSS. Through the Job Service. I believe Jim Hurst, who is

the owner of Hurst & Owens Lumber Company, he and his wife

Carol looked into these as they were painstakingly considering the

layoff and the closure at the mill. For that, I am very grateful.

Like I said, my daughter had used the program, but I was not

familiar with it until it was presented to us from the Job Service.

I was not aware of all the benefits that were presented to us.

The CHAIRMAN. Besides the time period and the distance problem, is there anything else that comes to mind that you might

change in the ideal world?

Ms. ROSS. No. The time, the benefits, and the health insurance

were my three main concerns.

The CHAIRMAN. Is this the kind of job you think is a real job,

that you can make a career out of and earn a living wage?

Ms. ROSS. Yes, Mr. Chairman, I do.

The CHAIRMAN. And what would that be, that job?

Ms. ROSS. What I am currently going for right now?

The CHAIRMAN. Yes.

Ms. ROSS. Eventually my husband and I are going to have our

own business. He is going to get out of the mill, as the future does

not look that positive for the lumber industry there. What I am

being trained now for is in a supervisory capacity on construction.

I am learning to build homes and I am doing accounting so I will

be able to follow up with that and be able to be accountable for the

funds spent on the jobs that I am on, and for my own benefit for

doing this, too.

The CHAIRMAN. Well, good for you.

Ms. ROSS. Thank you.
32

The CHAIRMAN. Now, do you think you are in a position to go

around and tell people about TAA and what a great job this is?

Ms. ROSS. Yes. I just cannot say enough good things about the

program. It has just been wonderful.

The CHAIRMAN. That is great.

Does anybody have anything to say that should be said or that

has not been asked? [No response.]

All right. This has been very helpful. Thank you all very, very

much, especially those who have traveled great distances.

The hearing is adjourned.

[Whereupon, at 11:45 a.m., the hearing was concluded.]
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