Ensuring Tax Exempt Organizations The Right To Appeal Act -- Continued

Floor Speech

BREAK IN TRANSCRIPT

Mr. DURBIN. I wish to speak on that issue.

Madam President, we cannot ignore that more than 95 percent of the potential customers for goods and services and agricultural produce live outside the United States of America. This means that to grow our economy and to maintain our influence in the world, we clearly have to embrace trade; however, this doesn't mean we would embrace every proposed trade agreement.

I have voted for about half of the trade agreements that have come before me in the House and Senate during my congressional service. I think some of those were good, on reflection, and some of them were not. There have been proposals made for free trade which I thought speak to the basic issue: Is America competitive in the 21st century? Can we outproduce other countries in the world? I never had any doubt about that, except for some given circumstances where another country has a specialty or some particular skill. I trust the United States. I trust our economy, our workers, and our business leaders.

When it comes to a trade agreement, I think we have to answer some hard questions about the specific trade agreement, not the principle of trade. Here is something most people do not know. They have proposed this trade promotion authority so we can vote on the Trans-Pacific Partnership. This is a document that has been negotiated over many months and is available for Members of Congress to see in a secluded setting. We cannot bring in as many staff as we would like, we cannot take the document out of the room, but it is accessible to us. Here is the point that is not often made: We have been told by the administration that this is not the final draft of the trade agreement. We have been told that after we pass the trade promotion authority bill, if we do, then there will be some more amendments and changes. So what we would view today is not necessarily what will be voted on at some later date. It is incomplete. It is a work in progress.

There are some things we should know and should reflect on. First, I will look at it from a very personal perspective. I am honored to represent the State of Illinois. It is one of the largest exporting States in the Midwest, and it is the fifth largest exporting State in our Nation. Illinois exports totaled over $65 billion in 2013 and about 10 percent of my State's gross State product.

Since 2009, Illinois exports increased by 58 percent, more than the national average of 50 percent. Fifty-six percent of exported Illinois goods in 2014--about $38 billion worth of exports--went to countries currently negotiating this Trans-Pacific Partnership Agreement with the United States. Is this important to my State? Is this part of the world important to my State? Of course it is. However, Illinois' success in exporting its products depends on good trade agreements that level the playing field, not just for Illinois companies but for American companies. This means we need to have strong antidumping rules that prevent companies overseas from dumping cheap, for example, steel products and other goods to undercut domestic prices and put our companies out of business. Did that happen? It sure did.

A little over 10 years ago, three countries that we trade with--Brazil, Japan, and Russia--had an idea. They figured out a way to drive American steel companies out of business. How did they do it? Were they better or more competitive? No. They dumped their steel. What does it mean to dump a product? It means to sell it in another country at lower than the cost of production in your own country. They took a loss on every ton of steel until they ran that American steel company out of business.

We saw it coming. We saw this dumping taking place. We had trade agreements, and we took them to the enforcement authorities. We said: They are killing us. They are killing these steel companies in America and the people who work there and that is not fair and it violates the trade agreement. The organizations responsible for policing these trade agreements said: We are going to put that on the docket and we will get to that in just a few months.

Well, a few months turned into a few years. We won the case. They had dumped steel in the United States, but the net result of it was not what we were looking for. The American steel companies went out of business. They could not compete against this dumped steel coming in from foreign countries.

When it comes to these agreements, we need to ask some basic questions. Is it enforceable on a timely basis? Can we stop unfair trade practices before they kill American jobs? That is pretty basic.

This steel issue continues to haunt us. Steel dumping is one of the reasons that the U.S. Steel plant in Granite City, IL, an area I grew up in, will stop production at the end of the month and put 2,080 Illinois jobs in jeopardy.

Fair trade agreements should include enforcement and they should also include enforceable currency manipulation provisions. When a country devalues its currency, the U.S.-made products, in comparison, become more expensive, and that adds to our trade deficit. It makes it difficult for U.S. companies to compete. There are a lot of ways to work on these trade agreements to the advantage of the exporting country if you break the rules.

Trade agreements should allow the United States to enact and implement consumer protection laws meant to protect the public. We don't want to go to the lowest common denominator when it comes to the basics, such as protecting consumers, protecting the environment, and protecting the workers. So whether it is food safety, environmental, public health, consumer financial protection, an investor's future products should not take priority over a country's right to protect its own people.

There is something known as the investor-state dispute settlement. It is a procedure which I want to describe to you because I think it gets to the heart of this trade agreement we are being asked to vote on. Investor-state dispute settlement procedures--often included in trade agreements and is included in several trade agreements that the United States is party to--prioritize corporate investors above almost everything.

What is it? This is how it works: It allows a corporation to challenge a law in an international court if the law, in the eyes of that corporation, violates a trade agreement and infringes on the investment made by a business. That sounds kind of theoretical. I will be specific.

We want U.S. businesses to have protections when they operate in other countries, so it appears to make sense, but corporations have gone too far. Corporations are using this dispute settlement to challenge legitimate laws in countries that protect the public, such as public health laws, environmental rules, land use, and food safety policies. More than 500 of these cases have been brought by corporations challenging the laws in various countries, including U.S. laws.

A U.S. chemical company launched a case against Canada, as a nation, when Canada banned a toxic gasoline additive used to improve engine performance--an additive already banned in the United States. An oil company sued Ecuador after a domestic court there ruled that the company owed $9.5 billion to clean up and provide health care to the workers in Ecuador after the oil company had dumped billions of gallons of toxic water in open-air oil sludge pits in Ecuador's Amazon.

Do you get the picture? Your country passes a law to protect the people living in your country, and then a corporation that has trade business with your company sues the country where the law was passed and says that new law is going to cost them money.

Those are two examples. A toxic additive to gasoline--a corporation sues Canada and says you cannot ban that; that will cost us profits. Efforts by Ecuador to avoid toxic dumping in their own country are being sued by an oil company that says, if you do that, it will cost us money. They did not go through the court system. They went through this investor settlement dispute.

There are so many examples of corporations using investor settlement dispute to undermine, rollback or delay laws meant to protect the public. One of the most egregious examples is Philip Morris. I kind of take this personally. As long as I have been around Congress, in the House and Senate, I have had a battle with tobacco companies. It happens to be the only product which when used according to manufacturers' directions will kill you and can still be sold legally. So I don't happen to think tobacco companies are in the best interest of public health for America or any other country.

About 26 years ago, I passed a law banning smoking on airplanes. It was the first time tobacco companies ever lost. I passed it in the House, and my good friend the late Frank Lautenberg of New Jersey passed it over here. It is the law of the land. For over 25 years, nobody smokes on an airplane. Tobacco companies fought us every single step of the way.

Philip Morris, one of the largest tobacco producers in the world, is aggressively challenging domestic tobacco laws around the world using the same investor-state dispute settlement that is going to be included in this agreement.

In Australia, as an example, after the highest court ruled against Philip Morris and upheld an Australian law requiring warning labels to cover a large majority of cigarette packaging, Philip Morris did not give up. Instead, Philip Morris sued Australia in an international tribunal under investor-state dispute settlement provisions in the Australia-Hong Kong Bilateral Investment Treaty.

If Philip Morris wins, Australia could be forced to pay Philip Morris for expected future losses because of a warning label on tobacco products. It could be billions of dollars.

Proponents of this settlement dispute that is baked into this agreement we are going to be asked to vote on rightly claim these procedures can't require countries to change their laws. In other words, Philip Morris can sue Australia and say: Your new law is going to cost us money. Keep it if you wish, but we lost profits because of this new law, and you have to pay us for our lost profits.

They can force countries like Australia to choose between changing the law or using their own taxpayer dollars to pay billions of dollars to a company like Philip Morris for their expected future losses. Think about that for a second. Philip Morris is selling a product that kills if it is used as intended. Some 6.3 million people each year across the world die because of tobacco-related disease. Australia's health care system loses millions of dollars in tobacco-related illnesses for people in their own country, as well as lost productivity at their workplaces. Yet, when Australia enacts a public health law requiring labels on tobacco products, Philip Morris can sue Australia? Yes, that is right. Tobacco products produced by Philip Morris are literally killing Australian citizens, and Philip Morris is suing Australia because the warning labels may cost them future profits.

The same thing is happening in Uruguay. Philip Morris again lost its case against Uruguay challenging its tobacco control laws which helped reduce tobacco use in that country by 4.3 percent. Now Philip Morris says: If we can't win in the courts, we are going to win through the trade agreement. We are going to win through the trade treaty, the dispute settlement in the trade treaty.

Sometimes even just the threat of a trade dispute challenging a law is enough to block, delay, or prevent enactment of a public health law because a country doesn't have the resources to engage in an expensive and lengthy lawsuit. This was the case in New Zealand and Nambia.

Corporations are using investor-state dispute settlements to undermine legitimate public laws, from financial protection, to public health, to environment and food safety. What are we thinking? If we would allow corporations under a new trade agreement to come in and attack public health laws in America, to come in and attack environmental protection in America--because they can argue: If I can't pollute in that river, it is going to cost my company a lot of money; therefore, you have to pay us if you want to keep that pollution law on the books.

That is why I am supporting Senator Elizabeth Warren's amendment that removes fast-track authority for any trade agreement that includes these investor-state dispute settlements. State-to-state dispute settlements would still be available if the corporation's rights have been violated or if a country passes a law that violates a trade agreement. But there is no need to go the extra step and give priority to the rights of corporations over the rights of people when it comes to laws that protect health, food, clean water, and clean air.

As the Senate continues to debate on giving fast-track authority to these trade agreements currently being negotiated, we still don't know what is in the agreements--not entirely. Providing fast-track authority for these agreements would prevent this Senate from offering amendments that would provide only one up-or-down vote after the agreement is finalized.

I support fair trade. I support trade. I hope the final agreements will meet the standards we have spoken of. But I cannot support granting fast-track authority to agreements where we don't know their contents and we could give away the most basic responsibility we have as Senators in the United States--to protect the people of America.

Madam President, I yield the floor.

I suggest the absence of a quorum.

BREAK IN TRANSCRIPT

Source