I 

111TH CONGRESS 

1ST SESSION H. R. 1875 

To establish an Emergency Commission To End the Trade Deficit. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 2, 2009 

Mr. DEFAZIO (for himself, Ms. SLAUGHTER, Ms. KAPTUR, and Mr. MASSA) 

introduced the following bill; which was referred to the Committee on 

Ways and Means 

A BILL 

To establish an Emergency Commission To End the Trade 

Deficit. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘End the Trade Deficit 

5 Act’’. 

6 SEC. 2. FINDINGS. 

7 The Congress makes the following findings: 

8 (1) In 1998, the United States trade balance 

9 was $166,140,000,000, leading the Congress to au10 thorize the Trade Deficit Review Commission. The 


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1 Commission was tasked to study ‘‘the nature, 

2 causes, and consequences of the United States mer3 chandise trade and current account deficits’’. 

4 (2) In 2007, the trade deficit ballooned to 

5 $700,258,000,000. And in 2006, the United States 

6 amassed the largest negative trade balance in its his7 tory, amounting to $753,283,000,000. 

8 (3) The United States has had 32 years of con9 secutive annual trade deficits, totaling 

10 $6,432,445,000,000. And in the last ten years, the 

11 annual trade balance has increased by a magnitude 

12 of seven. 

13 (4) The positive net international asset position 

14 that the United States built up over 100 years was 

15 eliminated in the 1980s. The United States today 

16 has become the world’s largest debtor nation, with a 

17 net debt of more than $2,441,800,000,000. 

18 (5) In recent times, the trade deficit has re19 tarded growth in the Nation’s gross domestic prod20 uct, increased the costs of servicing higher net for21 eign debt, and made the United States more depend22 ent on international financial considerations. 

23 (6) The United States merchandise trade deficit 

24 is characterized by large bilateral trade imbalances 

25 with a handful of countries. In 2007, 15 countries 


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1 accounted for 75 percent of the United States trade 

2 deficit in goods. The People’s Republic of China, 

3 Canada, Mexico, and Japan account for one-half of 

4 the trade deficit alone. 

5 (7) The United States manufacturing sector 

6 employed 13,919,000 people in 2007. But decline in 

7 manufacturing has meant the United States has lost 

8 3,718,000 manufacturing jobs since 1998. 

9 (8) Elimination of the United States trade def10 icit by the year 2019 would support millions of addi11 tional manufacturing jobs in the United States. 

12 (9) While the United States has one of the 

13 most open borders and economies in the world, the 

14 United States faces significant tariff and nontariff 

15 trade barriers with its trading partners. Current 

16 overall trade balances do not reflect the actual com17 petitiveness or productivity of the United States 

18 economy. Instead, they demonstrate the underlying 

19 structural nature of the trade deficits. 

20 (10) The United States is once again at a crit21 ical juncture in trade policy development. The struc22 tural nature of the United States trade deficit and 

23 its persistent growth must be reversed. The causes 

24 and consequences of the trade deficit must be docu25 mented and a plan must be developed to eliminate 


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1 the merchandise trade deficit within the next 10 

2 years. 

3 SEC. 3. ESTABLISHMENT OF COMMISSION. 

4 (a) ESTABLISHMENT.—There is established a com5 mission to be known as the Emergency Commission To 

6 End the Trade Deficit (in this Act referred to as the 

7 ‘‘Commission’’). 

8 (b) PURPOSE.—The purpose of the Commission is to 

9 develop a trade policy plan to eliminate the United States 

10 merchandise trade deficit by January 1, 2019, and to de11 velop a competitive trade policy for the 21st century. The 

12 plan shall include strategies necessary to achieve a balance 

13 of trade that fully reflects the competitiveness and produc14 tivity of the United States and also improves the standard 

15 of living of United States citizens. 

16 (c) MEMBERSHIP OF COMMISSION.— 

17 (1) COMPOSITION.—The Commission shall be 

18 composed of 11 members, of whom— 

19 (A) three shall be appointed by the Presi20 dent, of whom one shall be appointed to rep21 resent labor interests, one shall be appointed to 

22 represent small businesses, and one shall be ap23 pointed to represent consumer protection inter24 ests; 


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1 (B) one Senator and one other person shall 

2 be appointed by the President pro tempore of 

3 the Senate, upon the recommendation of the 

4 majority leader of the Senate; 

5 (C) one Senator and one other person shall 

6 be appointed by the President pro tempore of 

7 the Senate, upon the recommendation of the 

8 minority leader of the Senate; 

9 (D) one Member of the House of Rep10 resentatives and one other person shall be ap11 pointed by the Speaker of the House of Rep12 resentatives; and 

13 (E) one Member of the House of Rep14 resentatives and one other person shall be ap15 pointed by the minority leader of the House of 

16 Representatives. 

17 (2) QUALIFICATIONS OF MEMBERS.— 

18 (A) PRESIDENTIAL APPOINTMENTS.—Of 

19 the persons appointed under paragraph (1)(A), 

20 not more than one may be an officer, employee, 

21 or paid consultant of the executive branch. 

22 (B) OTHER APPOINTMENTS.—Persons ap23 pointed under subparagraph (B), (C), (D), or 

24 (E) of paragraph (1) who are not Members of 

25 Congress shall be persons who— 


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1 (i) have expertise in economics, inter2 national trade, manufacturing, labor, envi3 ronment, or business, or have other perti4 nent qualifications or experience; and 

5 (ii) are not officers or employees of 

6 the United States. 

7 (C) OTHER CONSIDERATIONS.—In appoint8 ing members of the Commission, every effort 

9 shall be made to ensure that the members— 

10 (i) are representative of a broad cross11 section of economic and trade perspectives 

12 within the United States; and 

13 (ii) provide fresh insights to achieving 

14 a trade deficit reduction plan. 

15 (d) PERIOD OF APPOINTMENT; VACANCIES.— 

16 (1) IN GENERAL.—Members shall be appointed 

17 not later than 60 days after the date of the enact18 ment of this Act and the appointment shall be for 

19 the life of the Commission. 

20 (2) VACANCIES.—Any vacancy in the Commis21 sion shall not affect its powers, but shall be filled in 

22 the same manner as the original appointment was 

23 made. 

24 (e) INITIAL MEETING.—Not later than 30 days after 

25 the date on which all members of the Commission have 


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1 been appointed, the Commission shall hold its first meet2 ing. 

3 (f) MEETINGS.—The Commission shall meet at the 

4 call of the Chairperson. 

5 (g) CHAIRPERSON AND VICE CHAIRPERSON.—The 

6 members of the Commission shall elect a chairperson and 

7 vice chairperson from among the members of the Commis8 sion. 

9 (h) QUORUM.—A majority of the members of the 

10 Commission shall constitute a quorum for the transaction 

11 of business. 

12 (i) VOTING.—Each member of the Commission shall 

13 be entitled to one vote, which shall be equal to the vote 

14 of every other member of the Commission. 

15 SEC. 4. DUTIES OF THE COMMISSION. 

16 (a) IN GENERAL.—The Commission shall be respon17 sible for developing a comprehensive trade policy plan, by 

18 examining the economic policies, trade, tax, and invest19 ment laws, and other legal incentives and restrictions that 

20 are relevant to reducing the United States trade deficit. 

21 (b) RECOMMENDATIONS.—The Commission shall ex22 amine and make recommendations to Congress and the 

23 President on the following: 

24 (1) The manner in which the Government of 

25 the United States establishes and administers the 


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1 Nation’s fundamental trade policies and objectives, 

2 including— 

3 (A) the relationship of the merchandise 

4 trade balance to the overall well-being of the 

5 United States economy and, in particular, the 

6 impact the trade balance has on wages and em7 ployment in the different sectors of the United 

8 States economy; 

9 (B) the relationship of United States for10 eign policy objectives to trade policy and the ex11 tent to which foreign policy considerations re12 ceive a priority over trade objectives; 

13 (C) the effects the trade deficits in the 

14 areas of manufacturing and technology have on 

15 defense production and innovation capabilities 

16 of the United States; 

17 (D) the extent to which United States 

18 monetary policies and the need for foreign cap19 ital to finance the current account deficit influ20 ence trade objectives; 

21 (E) the coordination, allocation, and ac22 countability of trade responsibilities among 

23 Federal departments and agencies; and 

24 (F) the methods for improving and en25 hancing systematic congressional review of forVerDate Nov 24 2008 02:42 Apr 07, 2009 Jkt 079200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H1875.IH H1875

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1 eign policy and trade policy as part of a plan 

2 to establish a coordinated set of national eco3 nomic priorities. 

4 (2) The causes and consequences of both the 

5 overall trade deficit and specific bilateral trade defi6 cits, including— 

7 (A) identification and quantification of the 

8 macroeconomic, sectoral, and bilateral trade 

9 factors contributing to the United States trade 

10 deficit with different countries; 

11 (B) identification and quantification of the 

12 impact of the trade deficit on the domestic 

13 economy, on the industrial base, on manufac14 turing capacity, on the number and quality of 

15 jobs, on productivity, on wages, on health, safe16 ty, and environmental standards, and on the 

17 standard of living in the United States; 

18 (C) identification and quantification of in19 dividual industrial, manufacturing, and produc20 tion sectors, and intra-industry and intra-com21 pany transactions that contribute to or are af22 fected by United States trade deficits; 

23 (D) a review of the adequacy of the cur24 rent collection and reporting of trade data, and 

25 the identification and development of additional 


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1 databases and economic measurements that 

2 may be needed to properly quantify the factors 

3 described in subparagraphs (A), (B), and (C); 

4 (E) the relationship that tariff and non5 tariff barriers have to trade deficits and the ex6 tent to which trade deficits have become struc7 tural; 

8 (F) the extent to which there is reciprocal 

9 market access in each country with which the 

10 United States has a persistent and substantial 

11 bilateral trade deficit; and 

12 (G) the role of transhipments on bilateral 

13 trade, including foreign imports and exports, 

14 with special attention to transhipments through 

15 countries receiving trade preferences under the 

16 North American Free Trade Agreement. 

17 (3) The relationship of United States trade 

18 deficits to both comparative and competitive trade 

19 advantages within the global economy, including— 

20 (A) a systematic analysis of the United 

21 States trade patterns with different trading 

22 partners, to what extent the trade patterns are 

23 based on comparative and competitive trade ad24 vantages, and how the trade advantages relate 


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1 to the goods that are exported to and imported 

2 from different trading partners; 

3 (B) the extent to which the increased mo4 bility of capital and technology has changed 

5 both comparative and competitive trade advan6 tages; 

7 (C) identification and quantification of 

8 goods imported into the United States that are 

9 produced with child or forced labor, or under 

10 social and environmental conditions that do not 

11 comply with United States law; 

12 (D) the impact that labor standards (in13 cluding the ability of labor to organize, bargain 

14 collectively, and exercise human rights) have on 

15 world trade; 

16 (E) the impact that currency exchange 

17 rates and the manipulation of exchange rates 

18 have on world trade and trade deficits; 

19 (F) the effect that offset and technology 

20 transfer agreements have on the long-term com21 petitiveness of the United States manufacturing 

22 sectors; and 

23 (G) the extent to which international 

24 agreements affect United States competitive25 ness. 


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1 (4) The flow of investments both into and out 

2 of the United States, including— 

3 (A) the impact such investments have on 

4 the United States trade deficit and living stand5 ards of United States production workers; 

6 (B) the impact such investments have on 

7 United States labor, community, environmental, 

8 health, and safety standards; 

9 (C) the extent to which United States tax 

10 laws, such as income deferral, contribute to the 

11 movement of manufacturing facilities and jobs 

12 to foreign locations; 

13 (D) the identification and quantification of 

14 domestic plant closures and the movement of 

15 such plants to foreign locations for production 

16 of goods for the United States market; 

17 (E) the impact of implied or threatened 

18 plant closings and movement of jobs to foreign 

19 locations on United States wage rates and 

20 working conditions; 

21 (F) the effect of investment flows on wages 

22 in countries with developed economies and on 

23 countries of the former Soviet Union; and 

24 (G) the effect of barriers to United States 

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1 veloping countries, particularly countries with 

2 which the United States has a trade deficit. 

3 (5) Evaluation of current policies and sugges4 tions for alternative strategies for the United States 

5 to systematically reduce the trade deficit and im6 prove the economic well-being of United States citi7 zens, including suggestions for— 

8 (A) the development of bilateral and multi9 lateral trade relationships based on market ac10 cess reciprocity; 

11 (B) the retention and expansion of the 

12 manufacturing, agricultural, and technology 

13 sectors in the United States; 

14 (C) the discouragement of the expatriation 

15 of United States plants, jobs, and production to 

16 countries that have achieved competitive advan17 tages by permitting lower wages or lower 

18 health, safety, and environmental standards, or 

19 by imposing requirements with respect to in20 vestment, performance, or other obligations; 

21 (D) methods by which the United States 

22 can effectively compete in a global economy 

23 while improving the labor, social, and environ24 mental standards of its trading partners, par25 ticularly developing countries; 


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1 (E) methods by which the United States 

2 can respond to substantial shifts or manipula3 tion of currency exchange rates that distort 

4 trade relationships; 

5 (F) methods for overcoming and offsetting 

6 trade barriers that are either not subject to or 

7 otherwise inadequately addressed by the World 

8 Trade Organization or other multilateral ar9 rangements; 

10 (G) specific strategies for achieving im11 proved trade balances with those countries with 

12 which the United States has significant, per13 sistent sectoral or bilateral trade deficits, in14 cluding Canada, the People’s Republic of China, 

15 Mexico, and Japan; 

16 (H) methods for the United States to re17 spond to the particular needs and cir18 cumstances of developing and developed coun19 tries in a manner that is mutually beneficial; 

20 and 

21 (I) changes that may be required to cur22 rent trade agreements and organizations to 

23 allow the United States to pursue and nurture 

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1 ner that ensures improved compensation and 

2 quality of life for United States citizens. 

3 SEC. 5. REPORT; CONGRESSIONAL HEARINGS. 

4 (a) REPORT.— 

5 (1) IN GENERAL.—Not later than 16 months 

6 after the date of the enactment of this Act, the 

7 Commission shall submit to the President and the 

8 Congress a report that contains— 

9 (A) the findings and conclusions of the 

10 Commission described in section 4; 

11 (B) a detailed plan for reducing both the 

12 overall trade deficit and specific bilateral trade 

13 deficits; and 

14 (C) any recommendations for administra15 tive and legislative actions that may be nec16 essary to achieve such reductions. 

17 (2) SEPARATE VIEWS.—Any member of the 

18 Commission may submit additional findings and rec19 ommendations as part of the report. 

20 (b) CONGRESSIONAL HEARINGS.—Not later than 6 

21 months after the report described in subsection (a) is sub22 mitted, the Committee on Ways and Means of the House 

23 of Representatives and the Committee on Finance of the 

24 Senate shall hold hearings on the report. 


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1 SEC. 6. POWERS OF COMMISSION. 

2 (a) HEARINGS.—The Commission may hold such 

3 hearings, sit and act at such times and places, take such 

4 testimony, and receive such evidence as the Commission 

5 considers advisable to carry out this Act. The Commission 

6 shall hold at least seven public hearings, one or more in 

7 Washington, DC, and four in different regions of the 

8 United States. 

9 (b) INFORMATION FROM FEDERAL AGENCIES.—The 

10 Commission may secure directly from any Federal depart11 ment or agency such information as the Commission con12 siders necessary to carry out this Act. Upon request of 

13 the Chairperson of the Commission, the head of such de14 partment or agency shall furnish such information to the 

15 Commission. 

16 (c) POSTAL SERVICES.—The Commission may use 

17 the United States mails in the same manner and under 

18 the same conditions as other departments and agencies of 

19 the Federal Government. 

20 SEC. 7. COMMISSION PERSONNEL MATTERS. 

21 (a) COMPENSATION OF MEMBERS.—Each member of 

22 the Commission who is not an officer or employee of the 

23 Federal Government shall be compensated at a rate equal 

24 to the daily equivalent of the annual rate of basic pay pre25 scribed for level IV of the Executive Schedule under sec26 tion 5315 of title 5, United States Code, for each day (inVerDate Nov 24 2008 02:42 Apr 07, 2009 Jkt 079200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\H1875.IH H1875

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1 cluding travel time) during which such member is engaged 

2 in the performance of the duties of the Commission. All 

3 members of the Commission who are officers or employees 

4 of the United States shall serve without compensation in 

5 addition to that received for their services as officers or 

6 employees of the United States. 

7 (b) TRAVEL EXPENSES.—The members of the Com8 mission shall be allowed travel expenses, including per 

9 diem in lieu of subsistence, at rates authorized for employ10 ees of agencies under subchapter I of chapter 57 of title 

11 5, United States Code, while away from their homes or 

12 regular places of business in the performance of duties of 

13 the Commission. 

14 (c) STAFF.— 

15 (1) IN GENERAL.—The Chairperson of the 

16 Commission may, without regard to the civil service 

17 laws and regulations, appoint and terminate an exec18 utive director and such other additional personnel as 

19 may be necessary to enable the Commission to per20 form its duties. The employment of an executive di21 rector shall be subject to confirmation by the Com22 mission. 

23 (2) COMPENSATION.—The Chairperson of the 

24 Commission may fix the compensation of the execu25 tive director and other personnel without regard to 


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1 the provisions of chapter 51 and subchapter III of 

2 chapter 53 of title 5, United States Code, relating 

3 to classification of positions and General Schedule 

4 pay rates, except that the rate of pay for the execu5 tive director and other personnel may not exceed the 

6 rate payable for level V of the Executive Schedule 

7 under section 5316 of such title. 

8 (d) DETAIL OF GOVERNMENT EMPLOYEES.—Any 

9 Federal Government employee may be detailed to the 

10 Commission without reimbursement, and such detail shall 

11 be without interruption or loss of civil service status or 

12 privilege. 

13 (e) PROCUREMENT OF TEMPORARY AND INTERMIT14 TENT SERVICES.—The Chairperson of the Commission 

15 may procure temporary and intermittent services under 

16 section 3109(b) of title 5, United States Code, at rates 

17 for individuals which do not exceed the daily equivalent 

18 of the annual rate of basic pay prescribed for level V of 

19 the Executive Schedule under section 5316 of such title. 

20 SEC. 8. AUTHORIZATION OF APPROPRIATIONS; GAO AUDIT. 

21 (a) IN GENERAL.—There are authorized to be appro22 priated $2,000,000 to the Commission to carry out this 

23 Act. 

24 (b) GAO AUDIT.—Not later than 6 months after the 

25 date on which the Commission terminates, the Comptroller 


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1 General of the United States shall complete an audit of 

2 the financial books and records of the Commission and 

3 shall submit a report on the audit to the President and 

4 the Congress. 

5 SEC. 9. TERMINATION OF COMMISSION. 

6 The Commission shall terminate 30 days after the 

7 date on which the Commission submits its report under 

8 section 5(a). 

9 SEC. 10. MORATORIUM ON FREE TRADE AGREEMENTS. 

10 The President shall not submit to the Congress any 

11 free trade agreement, or any legislation implementing a 

12 free trade agreement, until— 

13 (1) the report of the Commission has been de14 livered to the Congress and the President under sec15 tion 5(a); and 

16 (2) the committees of Congress referred to in 

17 section 5(b) have completed the hearings required 

18 under such section. 

Æ 


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