Ensuring Tax Exempt Organizations the Right to Appeal Act

Floor Speech

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Mr. MERKLEY. Mr. President, during this trade debate, we have often heard a lot about the words ``enforcement'' or ``enforceable,'' particularly the phrase ``enforceable labor and environmental standards.'' But the fact is there are no enforceable labor and environmental standards. There is no new generation of treaty in the TPP that is going to create something we have not had before.

What we have had before has simply failed us. Why is that? Well, we had side agreements on labor and the environment in NAFTA. Much is made of the fact that, well, we are not going to have side agreements anymore; we are actually going to put these standards right in the treaty itself. So somehow folks are arguing in support of this treaty that moving the print from over here to here somehow makes is it more effective.

That is not the case. We had the same labor and environmental standards in the agreements we passed a few years ago, agreements I voted against--the agreement with Colombia, the agreement with Korea.

But what have we seen over time? Have we ever seen any of these labor objectives and these environmental standards enforced? Let me give you a sense of what we are talking about. Under the International Labor Organization, ILO, they have a set of standards. They have lots of details. But there are things like freedom of association and the right to collective bargaining and elimination of forced labor or compulsory labor, as it is referred to, the abolition of child labor, the elimination of discrimination in the workplace.

Certainly, at the heart of this--back to the right of collective bargaining--is the right of unions to organize, the right of workers to talk to each other and to bargain for a fair return for their efforts. But have we ever enforced a single ILO provision? No, we have not. In fact, we have only challenged the terrible labor practices in another nation once; that is, Guatemala. That went through years before we officially challenged it, and now it is still not resolved some 8 years after it was first challenged.

Is there anything new that changes the process in the anticipated Trans-Pacific Partnership? No, it is the same process: put in the ILO standards and hope people will aspire to honor them--hope, the same hope that has failed us time and time again in treaty after treaty. So the next time someone comes to this floor and says there is an enforceable labor standard, no one should believe it because it is not there.

We have not enforced one labor standard, not one. Guatemala is the only one we have challenged, and that one, after 8 years, we still have not resolved it. How about environmental standards? Have we filed challenges on environmental standards? What are these environmental standards? Well, basically it is a requirement to honor international treaties.

No, these things are violated all over the place, but we have not challenged them a single time. Now, why is it that the United States does not challenge these violations? Well, first, it has to be a government-to-government action, when an issue is raised and folks are told: Hey, government, U.S. Government, you really should do something about trade unionists being murdered in Colombia.

Well, no, if we object, it will create ripples in the relationship. So the U.S. Government does not want to take action. It does not want to create ripples in the relationship. But if pressed, folks come and say: You know, it really matters that you said you would enforce this, U.S. Government, but you are not. You should really do something.

Well, you know, if we object to the way they are conducting themselves in regard to labor and environmental standards, there will be retaliatory actions against the United States. Then it will just be: We will challenge them, they will challenge us, and it will go on for years and years. It will disrupt the whole relationship. Why would we do that?

If that is not enough, then if the government, our government, is really serious about enforcing something, then the companies that have invested in that nation, then they come forward and say: Wait. The whole goal of this trade agreement was to create a stable environment for investing. If you challenge and try to have them honor the labor and environmental provisions, ultimately, not only will it produce retaliatory actions that will be potentially harmful, but if you should win somewhere down the line, that means there may be tariffs on the products that we produce in that country and they will not be able to enter the United States. Please do not mess up our investment in that nation.

So for these reasons, there has been no enforcement--none. Again, there was one effort in Guatemala never resolved. There is nothing new in this anticipated Trans-Pacific Partnership that would operate any differently.

How about if we had snapback provisions? We have been talking quite a lot on the situation with Iran, that if we reach an agreement with them in June, Congress is going to want to make sure that if there are violations of the agreement, that the controls on Iranian trade that have been effective in bringing them to the negotiating table will snap back into place to make sure folks really respond in Iran to honoring the agreement.

Is there any snapback provision anticipated, new strategy, this new tool to make sure the agreements are actually honored? No, there are not. So the old system has not worked. There is no new system. There has been no enforcement. Anyone who tells you there are enforceable labor and environmental standards is not telling you the truth because there are not. That is why we need to change the negotiations.

Now, the goal of fast-track was to lay out a series of objectives for the U.S. Government to pursue in writing an agreement on trade with other nations.

This is a little bit complicated now, because when you raise up an idea and say this should be addressed, the administration says, well, yes, but we have already negotiated this treaty. We cannot go back to the negotiating table and change it. We are 95 to 98 percent complete.

So, for example, we have been raising the issue of currency manipulation. This is a fundamental--fundamental--provision of what should be in a trade agreement, because when you get rid of a tariff, you can create an effective tariff on your trading partner's products and a subsidy on your own through intervention in the currency markets. It is known as currency manipulation. It should be covered, but it is not.

When you talk to the administration, the administration says we just cannot go back and talk about things that we have not already put on the table. So that would be unacceptable for us to take on this important provision now because we have already negotiated the agreement.

Well, then, what is really the point of fast-track, if it is not to lay out the standards that are expected for an agreement? In that case, it is nothing but a rubberstamp for an already negotiated treaty that does not meet the things that folks in this room are saying are important to have. In that case, it just simply becomes a greased track for approving the treaty or the agreement, as it is referred to. It is not referred to as a treaty. Why not? When it creates an international body that can assess fines on the United States, does that not qualify as a treaty? No. Because the folks who are negotiating this do not want it to be subject to the supermajority that the Constitution requires for a treaty. So they say we will call it an agreement. That will fix that. Now it is only a simple majority vote, and we will get this fast-track under the argument that Congress is getting a chance to say what needs to be in the treaty--but not really because we refuse to take any item we haven't already put in the agreement.

So that is really the state of affairs. That is why, instead of simply having negotiating objectives, we need to have negotiating standards that have to be met before an agreement is brought back to this body under the fast-track rule. Objectives are just wishful thinking, wishful thinking that you have some type of ``enforceable labor provisions,'' wishful thinking that there are some forms of enforceable environmental standards.

Is that really enough? Is that all we are asking for is a little bit of wishful thinking, when we already know it is not going to be honored? So let's put in mandatory negotiating objectives in these two categories. That is why I have submitted amendment No. 1369. I ask unanimous consent that the pending amendment be set aside and that my amendment be brought up.

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Mr. MERKLEY. Thank you, Mr. President.

I am saddened to hear that there is an objection in a context in which the majority leader has argued that he is going to have a robust and open amendment process. So why is there an objection to bringing an amendment forward to debate a core issue, which speech after speech after speech in support of this agreement--this fast-track to accelerate consideration of TPP--has referred to enforceable labor standards? Why not debate an amendment that would actually require enforceable labor standards? Why not?

Well, because apparently that is not a serious goal. Let's turn to another piece of this. There is a part of this system referred to as ``dispute settlement,'' an international system of dispute settlement, ISDS. What this does is it sets up a tribunal not subject to American law. It is an international tribunal, has one person chosen by America and one chosen by a foreign investor and one chosen by the combination.

This group, this ISDS, is empowered to apply a series of standards and say that an action by our country has damaged the interest of a foreign investor, and the foreign investor must be compensated or, if they are not compensated, that the law has to be changed. Well, really this whole concept was generated to protect American investments in countries that had weak judicial systems because that way, if you had an investment and the foreign country tried to expropriate it, change the law so you could not sell what you were making or something of that nature, there was a way to address that.

One can understand why American businesses would want that sort of stability. You can also understand why countries with poor judicial systems would want to sign on to such a system in order to encourage investment in their country. They want the jobs. They want that foreign investment.

But in the United States, we have a good judicial system. Why would we allow it to be displaced by an international tribunal--a tribunal that has not even been approved through the treaty process, mandated in the Constitution? Why would we give the power to three corporate lawyers who have conflicts of interest--there is no prohibition on conflicts of interest for the members who serve as judges--and allow them to rule on our consumer laws, allow them to rule on our public health laws, allow them to rule on our environmental laws? Quite frankly, that is giving away a significant piece of our sovereignty, carving a big hole out of our judicial system and handing it over to an international tribunal. If that doesn't constitute something that should qualify for treaty status--giving away a chunk of sovereignty out of our judicial system--I don't know what would qualify for a treaty. But this little slick game is underway of calling it an agreement in order to bypass our constitutional standard. And what does that mean? That means if a State says ``We no longer want to allow chemicals to be put into our carpets because those flame retardants are causing cancer in our children,'' a foreign investor who has set up a factory to make flame retardants can file suit against the United States and say they have been damaged as a foreign investor. The foreign investor gets rights that do not belong to in-country investors. Why should we give special rights to foreign investors that American investors do not have?

Why should we proceed and have a labeling law on e-cigarettes--a new challenge, if you will? Let's say, for example, that we require mandatory caps, childproof caps on the bottles. Let's say we banned the flavorings on e-cigarettes. Those flavorings are things such as double chocolate delight or any other number of candy flavors, bubble gum--you name it. If it sounds like candy, there is a container of liquid nicotine with that name on it. So you take away the flavorings, you greatly diminish the sales targeted at our youth.

Why would we control the flavorings? Well, we passed a law in 2009 that gave that power to the FDA, the Food and Drug Administration. The Food and Drug Administration has done an initial draft deeming regulation. Under this draft deeming regulation, they attempt to control or perhaps may control the flavorings. They would do so because cigarette companies--that is, tobacco companies--are targeting our children because they know that addiction occurs before the age of 21. You want to get our middle school and high school children puffing on e-cigarettes so that they will be addicted before they reach 21 because by then the brain has developed to the degree that people rarely get addicted.

So we, in protection of the health of our children, have seriously considered--created a framework for regulating this candy-flavored attack on the health of our youth. That is why we do it, for the protection of our youth. But along comes a foreign investor who set up a factory to create liquid nicotine and says: I can't sell my product now because I invested in all this equipment to do all these candy flavors and you are banning it. You either have to change your law or I get to be compensated.

So we should carve out of this ISDS settlement, if we have it at all--and I think it should be opt-in. A country that wants foreign investment because they know they have a shaky judicial system should opt into it. We would not opt in because we have a fair judicial system. But if it is going to exist, it should definitely carve out our public health, our consumer laws, and our environmental laws. And that is exactly why I have amendment No. 1401.

Mr. President, I ask unanimous consent that the pending amendment be set aside and amendment No. 1401 be called up.

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Mr. MERKLEY. I will keep pushing for consideration of my amendments, which are being banned from consideration on this floor, because if we are going to have a ``robust and open amendment process,'' we should, in fact, have a robust and open amendment process and consider these serious issues before us.

So let's turn to a third area, which is the fact that the Trans-Pacific Partnership--you hear robust labor protections that level the playing field. Well, a level playing field would involve roughly similar standards between countries. So is there anything that levels in any way the vast difference between the minimum wage in some of the prospective TPP countries and other countries? The answer is no, not a thing. The single most important labor differential between the nations is not addressed in any shape or form.

So if we were to look at the minimum wages, we would find, as the Senator from California noted earlier, that Brunei and Singapore have no minimum wage at all. Mexico and Vietnam are under $1 in minimum wage. Malaysia, Peru, and Chile are under $2.50. So basically we have 7 countries out of this group of 12 that have a minimum wage that either doesn't exist or is under roughly $2.50. That is very different from the other five countries in this agreement. These are countries such as the United States, with a minimum wage at $7.25--it should be higher, but it is $7.25; Japan's is $8.17; Canada has a minimum wage of $9.75; New Zealand, $11.18; and Australia's is $16.87--more than double the United States, which was surprising to me.

Well, if you have this vast difference and you have manufacturers in the United States, Japan, Canada, New Zealand, and Australia, these manufacturers would like to play off China against Malaysia and Malaysia against Vietnam and Vietnam against Mexico because that way they can drive the lowest possible wages between these countries.

Let me be quick to say that there are American companies--highly responsible American companies--that depend on overseas manufacturing that are very careful in monitoring their subcontractors and the conditions in which their subcontractors operate. These are often the brands that we know well, that are pillars in our community. But for every one of those, there are dozens of contractors and subcontractors that are seeking the lowest possible cost to make something, and that is why they want to play off these countries against each other. Oh, Malaysia, you are raising your minimum wage. Oh, you are enforcing your environmental standard. We are going to increase production in our Vietnamese factory. Oh, Vietnam, you now are saying you want to honor the ILO labor standard? Well, that is a problem. We are going to produce more in our Mexico factory. So this is opening a race to the bottom.

If we are going to come to the floor--as many have--to say that there are fundamentally even labor standards between the countries in this agreement, shouldn't we have even standards? Shouldn't we have an even minimum wage standard or at a minimum at least require there to be a base minimum wage and then have that raised over time for participants so as to reduce the differential between the highest paid and the lowest paid? Because not only does this system set up an ability and an effort to play off Malaysia against Mexico, against Vietnam, but it also sets up a situation where the conversation is like this: Oh, so here in America we are going to raise our minimum wage. Well, that means we are going to have to shift another 1,000 jobs somewhere else--maybe to Malaysia, maybe to Vietnam. Maybe we will use the WTO and go to China.

It has a big impact on suppressing living wages in our country, and we have seen this impact. Since 1974, we have seen productivity soar in our country, but the actual return to workers, inflation adjusted, has been flat and then declining for the last 10 years. Families are having a terribly difficult time getting by.

So not only do we have a stake in fairness not to create a race to the bottom between Malaysia, Vietnam, Mexico, and Peru, but we also have an incentive not to create a situation where U.S. living wages are constantly eviscerated under the threat of shipping those jobs overseas. Well, maybe we will assemble it here, but we will do more of our subcomponents in those countries. And once you set up an effective, efficient factory overseas, it makes it easier and easier to ship those.

That is why I have an amendment that says: At a minimum, let's fill this gaping gap. Let's proceed to require there to be, as part of the negotiations, the negotiation of a minimum wage for entry and for that minimum wage to be gradually increased in order to diminish the disparities between the high-wage countries, of which there are five in this agreement, and the low-wage countries, of which there are seven. This would be good to end the play off of one low-wage country against another, and it would be good to diminish the comparative advantage of low-wage countries in terms of taking manufacturing out of the United States. That is why I drafted amendment No. 1409.

Mr. President, I ask unanimous consent that the pending amendment be set aside and for my amendment No. 1409 to be called up.

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Mr. MERKLEY. I am zero for three now in terms of being able to get substantive amendments, serious amendments on this floor for debate, but I will try to on one more, and this one is anchored in recent news that we have seen the country-of-origin labeling--or COOL, as it is called--country-of-origin labeling standard knocked down just yesterday. What does this mean? This means it is going to be considered a trade violation for us to inform Americans on where their meat comes from. Isn't it a fundamental right in our country to know where our food comes from? Shouldn't we always have the right to know that? But we have engaged in a trade agreement--a previous trade agreement--and now the adjudicating body of that agreement says: No, no, no. That is unfair, to tell people where the meat comes from. Well, I think that is wrong, absolutely 100 percent wrong. Every American consumer should have the right to know where their meat comes from, and if I want to buy American-grown beef, I should have the right to do that, and I can't exercise that right unless I know--on the package--where it was grown.

If there are human rights violations or labor violations in Colombia and I don't want to buy Colombia meat until they fix their labor negotiations, I should have the right to use my dollar to buy my meat from the United States of America and not meat grown in Colombia. But that has been struck down because we gave away previously a chunk of our sovereignty. That is the danger of giving away the sovereignty of the United States of America to an international group that strikes down fundamental rights that every one of us should have. So let's fix that.

That is why I drafted amendment No. 1404 which would declare that the right to establish information for consumers about where their food comes from will not be violated by the agreement that is brought back to the Senate.

I hope everyone will join me in unanimous consent in saying that absolutely we are going to defend the rights of Americans to know where their food comes from.

Mr. President, I ask unanimous consent that the pending amendment be set aside and that amendment No. 1404 be brought up in order that we should all be able to exercise our rights to not buy products from countries that we find in violation of fundamental human rights or other labor abuses or environmental errors.

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Mr. MERKLEY. I see my colleagues on the floor who have their own amendments to address. I will conclude by saying that if I can't get up one of my four amendments to be debated--all substantive and all addressing key components of this agreement--then this is not a robust process, this is not an open process, and I ask the majority leader to keep his vision that he laid out on this floor that this would be an open process and a robust process.

Thank you.

Several Senators addressed the Chair.

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