79–006

106TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 106–672

WITHDRAWING THE APPROVAL OF THE CONGRESS FROM

THE AGREEMENT ESTABLISHING THE WORLD TRADE ORGANIZATION

JUNE 12, 2000.—Committed to the Committee of the Whole House on the State of

the Union and ordered to be printed

Mr. ARCHER, from the Committee on Ways and Means,

submitted the following

ADVERSE REPORT

together with

ADDITIONAL VIEWS

[To accompany H.J. Res. 90]

[Including Cost Estimate of the Congressional Budget Office]

The Committee on Ways and Means, to whom was referred the

joint resolution (H.J. Res. 90) withdrawing the approval of the

United States from the Agreement establishing the World Trade

Organization, having considered the same, report unfavorably

thereon without amendment and recommend that the joint resolution do not pass.

CONTENTS

Page

I. Introduction .................................................................................................... 2

A. Purpose and Summary ..................................................................... 2

B. Background ........................................................................................ 2

C. Legislative History ............................................................................ 3

II. Explanation of the Resolution ...................................................................... 3

III. Votes of the Committee ................................................................................. 7

IV. Budget Effect .................................................................................................. 7

A. Committee Estimate of Budgetary Effects ...................................... 7

B. Statement Regarding New Budget Authority and Tax Expenditures ................................................................................................. 7

C. Cost Estimate Prepared by the Congressional Budget Office ....... 7

V. Other Matters to be Discussed Under the Rules of the House .................. 8

A. Committee Oversight Findings and Recommendations ................. 8

B. Summary of Findings and Recommendations of the Committee

on GovernmentReform and Oversight .......................................... 9

C. Constitutional Authority Statement ................................................ 9

VI. Additional Views ............................................................................................ 10

2

I. INTRODUCTION

A. PURPOSE AND SUMMARY

H.J. Res. 90 would withdraw the approval of the Congress from

the Agreement establishing the World Trade Organization (WTO).

B. BACKGROUND

The five-year review of U.S. participation in the WTO

Sections 124–125 of the Uruguay Round Agreements Act (URAA)

(P.L. 103–465) require the President to submit a special report on

U.S. participation in the WTO every five years from the date the

United States first joined the WTO. According to the Ways and

Means Committee Report on the URAA, ‘‘The purpose of this provision is to provide an opportunity for Congress to evaluate the transition of the GATT to the WTO and to assess periodically whether

continued membership in this organization is in the best interest

of the United States.’’

Congress received the first of the five-year WTO reports on

March 2, 2000. Chapter II of the ‘‘2000 Trade Policy Agenda and

1999 Annual Report of the President’s Trade Agreements Program’’

is the President’s review of the WTO. The review discusses accomplishments that took place during the last five years, including: (1)

expanded market access; (2) protection for intellectual property

rights; (3) development of a sound and effective system to settle

disputes; (4) expansion of the rule of law; (5) conclusion of historic

agreements governing financial services, basic telecommunications

services, and information technology; (6) progress on the so-called

‘‘built-in’’ agenda to continue to liberalize agriculture and services;

(7) progress on negotiations on electronic commerce; (8) growth in

WTO membership from 119 nations in 1995 to 135 in 1999; and (9)

the significant progress toward accession of China and Taiwan, two

countries comprising over 21 percent of the world’s population.

Issues related to the future operation of the WTO, which are discussed in the report, include moving forward with the built-in

agenda on agriculture and services and addressing new issues such

as biotechnology, electronic commerce, trade and labor, and trade

and environmental protection.

Following receipt of the report, any Member of either House of

Congress may introduce a joint resolution to withdraw Congressional approval of the Agreement establishing the WTO. Congress

then has 90 session days from receipt of the report to act on the

joint resolution. The resolution is privileged and cannot be amended. The Committee on Ways and Means has 45 session days after

introduction of the resolution within which to act on it or be automatically discharged.

H.J. Res. 90, a joint resolution which would withdraw Congressional approval from the Agreement establishing the WTO, was introduced March 6, 2000, by Rep. Ron Paul (R–TX).

If the resolution is passed and vetoed by the President, each

House may vote to override the veto before the end of the 90-day

period or within 15 session days from the date on which Congress

receives the President’s veto message, whichever is later.

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The GATT/WTO system of multilateral trade rules

Because of its strength as a trading nation and the openness of

its market, the United States has long sought to establish an international trading system with a comprehensive set of enforceable

rules. The Uruguay Round was the eighth round or series of multilateral trade negotiations under the General Agreement on Tariffs

and Trade (GATT). These negotiations to expand trade, which date

back to the establishment of the GATT in 1948, were a response

to the Great Depression and the political upheaval and conflicts of

the 1930s, which deepened as a result of protectionist policies such

as the Smoot-Hawley Tariff. Work under the GATT system aimed

at raising living standards and promoting international economic

growth through the opening of world markets has spanned six decades.

The Uruguay Round Trade Agreements reached at the end of

1993 were noteworthy in that they greatly expanded coverage of

GATT rules beyond manufactured goods trade to include agricultural trade, services trade, trade-related investment measures,

trade-related intellectual property rights, and textiles. The most

visible accomplishment of this multilateral trade round was to establish the WTO to administer the GATT agreements and to settle

disputes among WTO members. The strengthened dispute settlement system was a major goal of the United States going into the

Uruguay Round trade negotiations, since the enforcement mechanism under the GATT was highly susceptible to delays and

stonewalling by countries having political or other difficulties in

bringing their trade measures into compliance with GATT rulings.

C. LEGISLATIVE HISTORY

Committee action

H.J. Res. 90 was introduced on March 6, 2000, by Representative

Ron Paul and was referred to the Committee on Ways and Means.

On June 8, 2000, the Committee ordered adversely reported H.J.

Res. 90 to the House of Representative by a recorded vote of 35–

0.

Legislative hearing and oversight

On February 8, 2000, the Trade Subcommittee held a hearing on

the outcome of the World Trade Organization (WTO) Ministerial

held in Seattle. On March 30, 2000, the Committee on Ways and

Means held a hearing on the future of the WTO. At these hearings,

Members of Congress, Minnesota Governor Jesse Ventura, former

U.S. Trade Representative Clayton Yeuter, and representatives

from the business community expressed their views on the United

States’ involvement in the WTO. Also, Chairman Crane led delegations from the Committee to the WTO’s First Ministerial Conference in Singapore in December of 1996 and the Third Ministerial Conference in Seattle in December of 1999.

II. EXPLANATION OF THE RESOLUTION

Present law

Under WTO rules, the United States may withdraw from the

WTO by exercising the procedures set forth in Article XV of the

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WTO Agreement, which requires six-months notice to the WTO Director General.

Section 125(b) of the Uruguay Round Agreements Act (P.L. 103–

465), which was approved by the House on November 29, 1994, establishes a procedure under which Congress may withdraw its approval of the WTO Agreement contained in section 101(a) of the

Act. Sections 124–125 of the Uruguay Round Agreements Act

(URAA) require the President to submit a special report on U.S.

participation in the WTO every five years from the date the United

States first joined the WTO. Following receipt of the report, any

member of either the House or Senate may introduce a joint resolution to withdraw Congressional approval of the WTO Agreement.

Congress then has 90 session days from receipt of the report to act

on the resolution. The resolution is privileged and cannot be

amended.

Explanation of the resolution

House Joint Resolution 90 states that Congress withdraws its approval, provided under section 101(a) of the Uruguay Round Agreements Act, of the WTO Agreement Establishing the World Trade

Organization entered into on April 15, 1994.

While enactment of a resolution withdrawing Congressional approval under section 125 would call into question the future of U.S.

participation in the WTO, it does not expressly provide for the

President to withdraw from the WTO. Nor would the resolution put

the United States in violation of its WTO obligations.

Reasons for change

The Committee reports Mr. Paul’s resolution to withdraw Congressional approval of the Agreement Establishing the World Trade

Organization adversely, because it concurs with the results of the

President’s five-year review of the WTO that U.S. participation in

the global trading system is vital to ‘‘America’s long term economic

and strategic interests, continued prosperity and strengthening the

rule of law around the world.’’ While the WTO is a young institution that continues to evolve by a consensus process in response to

concerns of Member countries, the Committee believes that the

benefits of U.S. participation are clear and compelling.

The Uruguay Round Trade Agreements are the most comprehensive in history. Consistent with the Committee’s expectation when

it considered legislation to implement these agreements in 1994,

they have promoted economic growth, job creation, and an improved standard of living for Americans. By lowering tariffs and a

wide range of other barriers to international trade and investment,

they have led to increased levels of world and U.S. output, trade,

real income, savings, investment, and consumption.

The WTO serves U.S. interests through three major functions.

First, WTO Member Governments agree on multilateral rules for

trade, which support a stable and predictable basis for commercial

decision-making that can by relied on by U.S. farmers, workers,

and businesses. With only 4 percent of the world’s population, and

nearly four-fifths of the world’s consumers living outside United

States borders, Americans need the freedom to compete in foreign

markets in order to generate jobs and economic growth at home.

According to the Council of Economic Advisors, since 1994 approxiVerDate 11-MAY-2000 22:26 Jun 14, 2000 Jkt 079006 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\HR672.XXX pfrm08 PsN: HR672
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mately one-fifth of U.S. economic growth has been linked to an expanding export sector. It is well-known that export-related jobs are

concentrated in high-skilled fields and generally pay 13–16% more

than the national average. As the world’s largest exporter, the

United States is the country that gains the most from an open multilateral trading system.

Secondly, the United States has benefitted significantly from the

new system established in the WTO for enforcement and the

prompt resolution of trade disputes between member countries.

This new system has eliminated many of the shortcomings of the

earlier GATT system where the dispute resolution process could be

blocked by member countries and often dragged out indefinitely. In

the first five years of operation, WTO Dispute Settlement panels

and the Appellate Body have become the most active and productive system for settling conflicts currently operating in the field of

international law.

In general, the WTO dispute settlement process has proven to be

a powerful instrument for reducing conflicts and bringing down

barriers to U.S. exports. The United States has filed more complaints to date than any other WTO member and also participates

actively as a third party in many other cases relevant to our commercial interests. The United States has prevailed in 25 of its 27

complaints acted on so far, either by successful settlement or panel

victory. Furthermore, in many other instances the threat of litigation has led to a satisfactory outcome for the United States under

the consultation procedures, without the need to invoke the formal

panel process.

As an example, enforcement is particularly important in the area

of intellectual property rights. Because WTO Member Governments

have accepted landmark rules for protecting patents, copyrights,

trademarks, and other forms of intellectual property, the WTO has

afforded unprecedented protection to property rights associated

with American research and innovation.

Of great concern to the Committee, there have been two instances where U.S. interests have been thwarted in the dispute settlement process, although the United States was victorious in the

panel process. Specifically, the European Union has refused to

come into compliance with WTO rulings against their import restrictions on bananas and hormone treated beef. The United States

was able to invoke WTO rights to suspend trade concessions (impose trade retaliation) in an amount equivalent to the damage to

the United States caused by the illegal practices. The Committee

intends to continue its oversight on this matter. In addition, the

Committee is concerned about the EU’s challenge to the U.S. Foreign Sales Corporation system (FSC). The Committee disagrees

strongly with the adverse panel and Appellate Body decisions and

believes the FSC rules, negotiated with the EU in the early 1980s,

fully meet WTO rules. Nevertheless, the Committee recognizes the

decision and intends to work with the Administration to ensure

that the United States is in full compliance with its obligations.

While the Committee strongly supports the U.S. objective of achieving further reforms to the dispute settlement system by addressing

instances of recalcitrance and opportunities for delay, there is no

doubt that the new system is significantly improved, as compared

to the inconclusive panel process under earlier GATT rules.

6

The third major function of the WTO is to provide a forum for

ongoing negotiations to reduce trade barriers. In the five years

since Congress approved the Uruguay Round Trade Agreements,

WTO Members have concluded three new trade pacts, all of which

allow Americans to capitalize on competitive strengths of our economy. Under the Information Technology Agreement, concluded in

1996, tariffs have been eliminated on $600 billion worth of trade

including items such as semiconductors, computers, and network

equipment. Concluded in 1997, the Agreement on Basic Telecommunications reduced costs in 95 percent of the global market

for telecommunications. Also in 1997, the WTO completed significant negotiations governing trade in financial services covering

$29.5 billion in global security assets, $38 trillion in global domestic bank lending, and $2.1 million in world wide insurance premiums.

Although the WTO Ministerial meeting, hosted by the United

States in December 1999, failed to result in agreement to begin a

new comprehensive round of WTO trade negotiations, Member

Governments did succeed earlier this year in launching talks to reform further agriculture trade and to expand commitments from

WTO Members with respect services trade. The Committee views

both of these sectors as critical to U.S. economic growth. Agenda

items supported by the Committee in relation to the future operation of the WTO include addressing new issues such as biotechnology and electronic commerce. The Committee also supports

efforts to increase transparency in the WTO. In particular, the

Committee believes that the dispute settlement process should be

opened up by instituting the prompt public release of documents,

public meetings of panels, and acceptance of amicus briefs.

With respect to the argument made by proponents of H.J. Res 90

that participation in the WTO threatens U.S. sovereignty, the Committee continues to give close consideration to this question, as it

did when the Uruguay Round Agreements Act was first submitted

for Congressional approval in 1994. It remains true that neither

the WTO, nor its dispute settlement panels, can force a change in

U.S. laws or regulations. The United States alone decides how to

respond to panel decisions. The United States and all WTO Members retain the right to set the levels of environmental, health, and

safety protection that they deem appropriate, even when such levels of protection are higher than those imposed by any other country. Generally, the WTO rules simply require that Members opt for

less trade-restrictive measures if possible and avoid discriminating

against foreign products in favor of domestic products. For the protection of U.S. exporters, the WTO stipulates that food safety measures should be based on sound science.

In the future, the Committee expects the WTO to remain fundamental to the formulation and execution of U.S. trade policy, with

its rules and principles serving as a central guide for achieving new

agreements to expand trade bilaterally, regionally, and multilaterally. While much remains to be done to improve the WTO, there

is no doubt that it administers a system which ensures that when

U.S. goods, agricultural products, and services are sent overseas,

they receive more equitable treatment than would otherwise be the

case. In the Committee’s view, H.J. Res. 90 is dangerous and illogical, because it would isolate the United States from this system

7

and damage our leadership in the international economy, thereby

undermining U.S. national economic and security interests.

III. VOTES OF THE COMMITTEE

In compliance with clause 3(b) of rule XIII of the Rules of the

House of Representatives, the following statements are made concerning the votes of the Committee on Ways and Means in its consideration of the resolution, H.J. Res. 90.

MOTION TO REPORT THE BILL

The resolution, H.J. Res. 90, was ordered adversely reported by

a roll call vote of 35 yeas to 0 nays (with a quorum being present).

The vote was as follows:

Representatives Yea Nay Present Representatives Yea Nay Present

Mr. Archer ............................. X ........... ............. Mr. Rangel ........................... X ........... .............

Mr. Crane .............................. X ........... ............. Mr. Stark .............................. ........... ........... .............

Mr. Thomas ........................... X ........... ............. Mr. Matsui ............................ X ........... .............

Mr. Shaw ............................... X ........... ............. Mr. Coyne ............................. X ........... .............

Mrs. Johnson ......................... X ........... ............. Mr. Levin .............................. X ........... .............

Mr. Houghton ........................ ........... ........... ............. Mr. Cardin ............................ X ........... .............

Mr. Herger ............................. X ........... ............. Mr. McDermott ..................... X ........... .............

Mr. McCrery ........................... X ........... ............. Mr. Kleczka ........................... ........... ........... .............

Mr. Camp .............................. X ........... ............. Mr. Lewis (GA) ..................... X ........... .............

Mr. Ramstad ......................... X ........... ............. Mr. Neal ............................... X ........... .............

Mr. Nussle ............................. X ........... ............. Mr. McNulty .......................... X ........... .............

Mr. Johnson ........................... X ........... ............. Mr. Jefferson ........................ X ........... .............

Ms. Dunn .............................. X ........... ............. Mr. Tanner ............................ X ........... .............

Mr. Collins ............................ X ........... ............. Mr. Becerra .......................... X ........... .............

Mr. Portman .......................... ........... ........... ............. Mrs. Thurman ....................... X ........... .............

Mr. English ........................... X ........... ............. Mr. Doggett .......................... X ........... .............

Mr. Watkins ........................... X ........... ............. .............................................. ........... ........... .............

Mr. Hayworth ......................... X ........... ............. .............................................. ........... ........... .............

Mr. Weller .............................. X ........... ............. .............................................. ........... ........... .............

Mr. Hulshof ........................... X ........... ............. .............................................. ........... ........... .............

Mr. McInnis ........................... X ........... ............. .............................................. ........... ........... .............

Mr. Lewis (KY) ...................... X ........... ............. .............................................. ........... ........... .............

Mr. Foley ............................... X ........... ............. .............................................. ........... ........... .............

IV. BUDGET EFFECTS

A. COMMITTEE ESTIMATE OF BUDGETARY EFFECTS

In compliance with clause 3(d)(2) of rule XIII of the Rules of the

House of Representatives, the following statement is made concerning the effects on the budget of this resolution, H.J. Res. 90 as

reported: The Committee agrees with the estimate prepared by

CBO which is included below.

B. STATEMENT REGARDING NEW BUDGET AUTHORITY AND TAX

EXPENDITURES

In compliance with clause 3(c)(2) of rule XIII of the Rules of the

House of Representatives, the Committee states that enactment of

H.J. Res. 90 would have no budgetary effect.

C. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE

In compliance with clause 3(c)(3) of rule XIII of the Rules of the

House of Representatives, requiring a cost estimate prepared by

8

the Congressional Budget Office, the following report prepared by

CBO is provided.

U.S. CONGRESS,

CONGRESSIONAL BUDGET OFFICE,

Washington, DC, June 12, 2000.

Hon. BILL ARCHER, Chairman, Committee on Ways and Means, House of Representatives, Washington, DC.

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.J. Res. 90, a joint resolution

withdrawing the approval of the United States from the agreement

establishing the World Trade Organization.

If you wish further details on this estimate, we will be pleased

to provide them. The CBO staff contact is Hester Grippando.

Sincerely,

BARRY B. ANDERSON

(For Dan L. Crippen, Director).

Enclosure.

V. OTHER MATTERS TO BE DISCUSSED UNDER THE

RULES OF THE HOUSE

A. COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

With respect to clause 3(c)(1) of rule XIII of the Rules of the

House of Representatives (relating to oversight findings), the Committee, based on public hearing testimony and information from

the Administration, concluded that it is appropriate and timely to

consider the resolution as reported.

H.J. Res. 90—A joint resolution withdrawing the approval of the

United States from the agreement establishing the World Trade

Organization

CBO estimates that H.J. Res. 90 is likely to have no budgetary

effect. The legislation would withdraw the U.S. Congress’ approval

of the World Trade Organization (WTO) agreement that was provided under section 101(a) of the implementing legislation (Public

Law 103–412). If the United States were to withdraw from the

WTO, possible changes in U.S. collections of tariff duties could

have significant budgetary effects. However, the ultimate impact of

the legislation is unclear. In particular, it is not clear that enactment of this resolution would require the United States to withdraw from the WTO—and even if it did, there might not be any

changes in tariffs. Based on information from the Administration

that suggests that the legislation would not affect the application

of the WTO agreement to the United States, CBO concludes that

enacting H.J. Res. 90 would probably have no budgetary impact.

H.J. Res. 90 contains no intergovernmental mandates as defined

in the Unfunded Mandates Reform Act (UMRA) and would not affect the budgets of state, local, or tribal governments. Withdrawing

from the WTO would broaden the conditions under which the U.S.

government could impose trade restrictions on imports. Trade restrictions—such as increased tariff duties or quota limits more restrictive than under current law—would impose private-sector

mandates on importers of affected items. However, because the legVerDate 11-MAY-2000 22:26 Jun 14, 2000 Jkt 079006 PO 00000 Frm 00008 Fmt 6659 Sfmt 6602 E:\HR\OC\HR672.XXX pfrm08 PsN: HR672
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islation would probably not affect the application of the WTO

agreement to the United States, CBO concludes that H.J. Res. 90

would likely impose no new private-sector mandates as defined in

UMRA.

The CBO staff contacts are Hester Grippando (for federal costs),

and Patrice Gordon (for private-sector impact). This estimate was

approved by G. Thomas Woodward, Assistant Director for Tax

Analysis, and Peter H. Fontaine, Deputy Assistant Director for

Budget Analysis.

B. SUMMARY OF FINDINGS AND RECOMMENDATIONS OF THE

COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT

With respect to clause 3(c)(4) of rule XIII of the Rules of the

House of Representatives, no oversight findings or recommendations have been submitted to the Committee by the Committee on

Government Reform and Oversight with respect to the subject matter contained in H.J. Res. 90.

C. CONSTITUTIONAL AUTHORITY STATEMENT

With respect to clause 3(d)(1) of rule XIII of the Rules of the

House of Representatives, relating to Constitutional Authority, the

Committee states that the Committee’s action in reporting the bill

is derived from Article 1 of the Constitution, Section 8 (‘‘The Congress shall have power to lay and collect taxes, duties, imposts and

excises, to pay the debts and to provide for * * * the general Welfare of the United States.’’)

(10)

VII. ADDITIONAL VIEWS

We strongly support continued U.S. participation in the World

Trade Organization (WTO), and disapprove of H.J. Res. 90, which

would withdraw Congressional approval of the WTO Agreement.

The WTO, and its predecessor, the General Agreement on Tariffs

and Trade (GATT), have opened foreign markets around the world

to U.S. goods and services, creating new opportunities for U.S.

businesses, farmers and workers. The United States, which has one

of the most open and transparent markets in the world, clearly has

benefitted from the market opening work of the WTO and the

GATT. The current strength of the U.S. economy is due in part to

WTO rules. Moreover, on the whole, the WTO’s dispute settlement

system has been an effective means for enforcing U.S. rights.

That being said, there is room for improvement. Five years experience with the WTO system shows key areas where we need to

build on the solid foundation of the Uruguay Round and the six

previous rounds of multilateral trade negotiations in he GATT. In

particular, we see four key areas in need of reform.

First, we must open up the WTO to public view and public input.

Recent events made clear that as trade has increased and had

greater impact on people’s lives, three is a greater desire for knowledge about and participation in the development of trade rules.

Currently, the public is not aware of what happens in the WTO,

and as a result, there is widespread mistrust of the institution.

Opening the process—by de-restricting documents more quickly, allowing public submissions to dispute settlement panels, and opening panel proceedings to public view—will help to de-mystify the

institution, and ultimately will go a long way toward alleviating

some of the suspicions surrounding it.

Second, we must continue to develop the WTO as an institution

that reflects the expanding scope of the trade policy agenda. It is

axiomatic that the issues implicated by trade negotiations extend

beyond tariff and other border measures, partially because of advances in technology and of increased economic integration. With

respect to technological developments, e-commerce, breakthroughs

in biotechnology, and other advances, have created new opportunities for increased global trade. We must continue to develop appropriate and effective policies and rules to address them. In the same

vein, we must tackle the other issues that have increased salience

in the trade context—including environmental protection and the

operation of labor markets.

We must promote greater understanding of the links between

trade and labor market issues and ensure the more consistent enforcement of core labor standards as competition grows between

evolving economies and developed economies. This means following

through with the mandate set forth in section 131 of the Uruguay

Round Agreements Act by establishing a working group on trade

11

and labor in the WTO, as well as reaffirming the link between

trade and labor issues in our bilateral and regional relationships.

We also must move forward on bringing environmental issues more

meaningfully into trade discussions. This means bringing the work

of the WTO’s Committee on Trade and the Environment to bear on

the work of WTO negotiating groups. It also means committing additional resources to performing environmental impact assessments

before entering into new trade agreements.

Third, we must work to make developing countries our partners,

rather than our opponents. This means not only ensuring that the

process of negotiations enables all Members to participate in a

meaningful manner, but also ensuring that the benefits of trade

liberalization reach the poorest countries and the poorest people of

the world. We need to pursue a coherent policy of trade and aid by

relieving the least developed countries of overbearing debt and providing technical assistance and other aid that will, together with

stronger trading relationships, provide the strongest possible foundation for increased living standards and the creation of a strong,

global middle class by promoting growth with equity.

Fourth, we must be certain that what has already been negotiated is functioning effectively. The importance of this point cannot be overstated. The Uruguay Round Agreements represent a

balance of commitments by WTO Members. Failing to enforce commitments made, or attempting to redefine what has been agreed to

through the dispute settlement process, undermines confidence in

the system, and will make negotiating new agreements that much

harder.

To conclude, we believe that most of our colleagues in the House

will agree that, on balance, the benefits of U.S. participation in the

WTO far outweigh the costs, and that the organization has been a

positive force in promoting and shaping global trade. But we also

hope that our colleagues will look at consideration of this resolution

as an opportunity to acknowledge candidly and constructively the

current shortcomings of the WTO, and U.S. Trade policy, and to

begin to develop and implement recommendations for improving

both.

SANDER LEVIN.

BENJAMIN L. CARDIN.

ROBERT T. MATSUI.

JOHN LEWIS.

RICHARD E. NEAL.

XAVIER BECERRA.

JOHN TANNER.

C.B. RANGEL.

JIM MCDERMOTT.

WILLIAM J. COYNE.

WILLIAM J. JEFFERSON.

JERRY KLECZKA.

MICHAEL R. MCNULTY.

LLOYD DOGGETT.

(12)

ADDITIONAL VIEWS OF REPRESENTATIVE BENJAMIN L.

CARDIN

I fully concur with the views of my fellow Democrats regarding

the continued U.S. participation in the World Trade Organization

(WTO). In committee I voted against H.J. Res. 90, which would

have withdrawn Congressional approval of the WTO Agreement.

I write separately to encourage Congress to consider a more effective way to review WTO decisions that are adverse to the economy of the United States.

In 1994 the United States Trade Representative (USTR) wrote to

then-Senator Bob Dole to endorse the establishment of a WTO Dispute Settlement Review Commission. The Commission would consist of five federal appellate judges, and would review all final and

adopted WTO dispute settlement reports. The Commission, under

the Dole proposal, would review adverse WTO findings, using a set

of four criteria, to determine whether the WTO panel:

(1) demonstrably exceeded its authority or its terms of reference;

(2) added to the obligations, or diminished the rights, of the

United States under the Uruguay Round;

(3) acted arbitrarily or capriciously, engaged in misconduct, or

demonstrably departed from established panel or appellate procedure; and

(4) deviated from the applicable standard of review, including in

antidumping cases, set forth in the 1994 GATT agreement.

The Commission would issue its determination within 120 days

after the report is adopted. The Commission will play a vital role

in determining whether the WTO panel acted improperly to the

detriment of the United States.

Upon the issuance of any affirmative determination by the Commission, any Member of each House would be able to introduce a

joint resolution calling on the President to negotiate new dispute

settlement rules that would address and correct the problem identified by the Commission. The resolution would be privileged and

considered under expedited committee and floor procedures.

If there are three affirmative determinations in any five-year period, any Member of each House would be able to introduce a joint

resolution to disapprove U.S. participation in the Uruguay Round

agreements, again using expedited procedures.

I am currently working with interested members of this committee and consulting with the Administration on drafting appropriate legislation, using the Dole proposal as the basic framework.

While we may disagree on the appropriate remedy for responding

to an adverse WTO panel decision, we all agree that we must closely monitor WTO panel decisions that affect American economic interests. The Review Commission would raise the visibility of important WTO decisions that have a profound effect on the economy of

the United States. I hope that the Commission would also reinvigoVerDate 11-MAY-2000 22:26 Jun 14, 2000 Jkt 079006 PO 00000 Frm 00012 Fmt 6604 Sfmt 6604 E:\HR\OC\HR672.XXX pfrm08 PsN: HR672
13

rate the Congressional oversight role regarding trade policy, and

encourage members of Congress to seriously reflect on WTO decisions and their impact on the United States.

BEN CARDIN.

(14)

ADDITIONAL VIEWS OF CONGRESSMAN PETE STARK

Although I oppose the resolution before us today, I do not want

my opposition to be interpreted as support for the World Trade Organization (WTO). I have many concerns with the WTO and the

way in which the U.S. Trade Representative (USTR) measures the

benefits of U.S. membership in the Organization. The lack of leadership from our Administration in the WTO has allowed

transnational organizations to dictate U.S. trade policy while consumer protections, labor, environment and human rights have not

been considered relevant issues in the world body. The Executive

Branch has fought fervently for intellectual property rights but

lacks the same zeal when it comes to the survival of the species.

The World Trade Organization will make these issues an integral

part of the trade agenda when the world’s greatest trade advocate

insists that these issues be of paramount importance.

No one will dispute that trade increasingly involves broad public

policy matters, yet there are no representatives of labor, environment, or human rights non-governmental organizations on most

WTO trade advisory committees. Industry representatives are the

sole members on the vast majority of trade advisory committees

and this is simply wrong. We cannot expect to have the interests

of labor, the environment and the oppressed represented by those

who are motivated by the bottom line. Separating the environment

and labor from other aspects of trade by creating side committees

such as the Labor Advisory Committee or the Trade and Environment Policy Advisory Committee has little effect of addressing the

impact trade has on these voiceless segments. These interests must

be allowed fair representation in all of the Industry Sector Advisory Committees.

The WTO is a highly surreptitious club. Members of the advisory

committees have access to government information concerning

overall negotiating objectives and positions of the U.S. that is not

otherwise publicly available. The same advisory committee members are able to relay their views directly to government negotiators, giving the advisory committee members an obvious advantage for influencing positions. In addition, virtually all of the meetings are held in closed session and records are not uniformly available to the public. Freedom of information requests are often answered with extensive withholdings. The U.S. was founded on

democratic and transparent principles. The WTO operates behind

closed doors without concern for the views of the American public.

USTR will only help their cause by spearheading efforts to shed

light on this esoteric organization.

Finally, the Administration must uphold domestic statute when

dealing with other WTO member nations. The U.S. Congress executes the will of the American people through the various laws enacted. These laws must be upheld within our sovereign territory as

15

well as in the global arena. On more than one occasion, the Administration has pressured other countries not to enact protections for

the environment or public health. The U.S. lobbied against Japan’s

consideration of new fuel economy standards as well as Europe’s

proposals to protect children from toxic toys. Again, the public was

unaware that this was taking place until after it had transpired.

We must be encouraging stronger standards from all of our trading

partners—even if that means regulating genetically modified organisms here in the U.S.

If President Clinton is sincere in his pledge to put a human face

on trade, then the Administration should take my views as first

steps in improving trade for all consumers, all workers and our

global environment. These various interests must be invited to the

negotiating table to provide true balance to the current bias in the

WTO. The process must be de transparent and open to all Americans. The U.S. must set the standard for improving domestic and

global conditions, not lead in the race to the bottom for the sake

of multinational profit.

PETE STARK.

Æ