To amend the Trade Act of 1974 to require the President to make a determination that a fundamental international payments problem exists and to proclaim a temporary import surcharge whenever the United States current account deficit exceeds 2 percent of the United States Gross Domestic Product.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Balanced Trade Act of 2006''.

SEC. 2. FINDINGS OF CONGRESS.

    Congress makes the following findings:
            (1) Since 1997, the United States current account deficit, 
        the broadest measure of United States international trade, has 
        grown substantially, both absolutely and relative to gross 
        domestic product (GDP), increasing from $140,400,000,000 in 
        1997 (1.7 percent of GDP) to $791,000,000,000 in 2005 (6.3 
        percent of GDP).
            (2) Strong manufacturing and agricultural sectors are 
        important to nurturing and sustaining the health and security 
        of the Nation's economy. The persistent current account deficit 
        weakens United States manufacturing and agriculture and causes 
        the loss of United States jobs. It can be estimated that the 
        2005 merchandise trade deficit cost the United States up to 
        15,000,000 jobs.
            (3) The direction and trend of the current account deficit 
        is unsustainable in the long run and needs immediate corrective 
        action.
            (4) It is critical to the Nation's economic future that the 
        current account deficit be addressed by adopting statutory 
        changes that will eliminate some of the causes of the trade 
        deficit and will begin to move the Nation to a positive trade 
        balance.

SEC. 3. MANDATORY PRESIDENTIAL ACTION WHENEVER THE UNITED STATES 
              CURRENT ACCOUNT DEFICIT EXCEEDS 2 PERCENT OF THE UNITED 
              STATES GROSS DOMESTIC PRODUCT.

    Section 122 of the Trade Act of 1974 (19 U.S.C. 2132) is amended--
            (1) by redesignating subsections (c) through (h) as (d) 
        through (i), respectively; and
            (2) by inserting after subsection (b) the following new 
        subsection (c):
    ``(c) Mandatory Presidential Proclamation of Temporary Import 
Surcharge Whenever the United States Current Account Deficit Exceeds 2 
Percent of the Gross Domestic Product.--
            ``(1) In general.--Notwithstanding the provisions of 
        subsections (a) and (b), whenever there is a United States 
        current account deficit that exceeds 2 percent of the gross 
        domestic product, then--
                    ``(A) for purposes of subsection (a), the President 
                shall determine that fundamental international payments 
                problems do exist that require special import measures 
                to restrict imports; and
                    ``(B) within 30 days after making that 
                determination, the President shall proclaim, for the 
                period described in paragraph (2), a temporary import 
                surcharge under this subsection in the form of duties 
                (in addition to those already imposed, if any) on 
                articles imported into the United States.
            ``(2) Period of surcharge.--The period of the surcharge 
        proclaimed under this subsection is the period beginning on the 
        date on which the surcharge is proclaimed and ending on the 
        date on which there is not a United States current account 
        deficit, or there is a United States current account deficit 
        that does not exceed 1 percent of the gross domestic product.
            ``(3) Amount of surcharge.--
                    ``(A) Minimum.--The amount of the surcharge 
                proclaimed under this subsection shall be not less than 
                20 percent ad valorem.
                    ``(B) Adjustment to ensure period of not more than 
                24 months.--Subject to subparagraph (A), the amount of 
                the surcharge shall be adequate to ensure that the 
                period in which the surcharge applies (as described in 
                paragraph (2)) is not more than 24 months. Whenever the 
                President determines that the amount of the surcharge 
                is inadequate to ensure that the period in which the 
                surcharge applies is not more than 24 months, the 
                President shall increase the amount by at least 1 
                percent.
            ``(4) Data used in making determinations.--Each 
        determination under this subsection shall be made using the 
        most recently available information for a 1-year period 
        compiled by the Bureau of Economic Analysis of the Department 
        of Commerce.
            ``(5) Exceptions.--
                    ``(A) Country exemptions.--Subsection (e)(2) 
                applies to a surcharge proclaimed under this subsection 
                to the same extent that it applies to an import 
                restricting action proclaimed pursuant to subsection 
                (a).
                    ``(B) Product exceptions.--Subsection (f) applies 
                to a surcharge proclaimed under this subsection to the 
                same extent that it applies to an import restricting 
                action proclaimed pursuant to subsection (a).''.

Summary: Balanced Trade Act of 2006 - Amends the Trade Act of 1974 to require the President whenever there is a trade deficit that exceeds 2% of the gross domestic product (GDP) to: (1) restrict imports; and (2) proclaim, for a determined period, a temporary import surcharge of not less than 20% ad valorem on articles imported into the United States. (Currently, the President has the authority to temporarily impose import surcharges (not to exceed 15% ad valorem) and import restrictions on articles in certain situations of fundamental international payments problems.)