by Janet Kopenhaver
AWPA Director of Government Affairs
TRADE
� Trade Promotion (Fast Track) Authority
Trade Promotion Authority (TPA), which gives the president authority
to sign trade deals that Congress cannot amend, lapsed during the Clinton
Administration because of political infighting. It is important because
other countries do not want to negotiate with a president who does not
have the final authority to sign a deal that cannot be changed. Thus, fast
track is vital if there is to be any progress when a new round of world
trade talks begins or a host of other trade agreements are negotiated.
US House Speaker Dennis Hastert (R-IL) cast doubt on the near-term prospects
for passage of legislation granting new trade negotiating authority to
President Bush, saying Republicans were focused for the time being on cutting
taxes. While he called passage of this bill an important priority, he stated
TPA would be difficult to pass due to opposition from Democrats in the
narrowly divided House.
On the other side of the Capitol, Senators Roberts (R-KS), Hagel (R-NE)
and Gramm (R-TX) introduced S 599, a bill that would permanently renew
TPA or fast track. Senate Finance Committee Chairman Charles Grassley (R-IA)
said his panel would begin marking up the bill within the next several
weeks. However, he predicted it could be the end of the year before the
whole Congress can give Bush this authority.
One of the biggest hurdles to passage is the labor unions' insistence
on linking labor and environment policies to trade agreements. The USTR
has signaled that the Administration is willing to consider language on
labor and the environment, as long as such language could not be used to
erect protectionist barriers. Rep. Bill Thomas (R-CA), Chairman of the
House Ways and Means Committee, admitted that a compromise is required
from all sides to break the stalemate on trade negotiating authority.
The ranking Democrat on the Senate Finance Committee, Max Baucus (D-MT),
insisted that any fast track bill must address labor and environment issues.
But Chairman Grassley countered that he will strongly oppose any legislation
that directly or indirectly involves the use of trade sanctions to enforce
labor and environment provisions in trade agreements.
The business community is now softening their opposition to including
these provisions in international trade agreements because of the fact
that without Democratic support, no trade agreements will get through the
Congress. Ironically, this move has drawn the ire of leading Republicans.
House Majority Leader Dick Armey (R-TX) stated that any votes that might
be gained by adding these provisions to a fast-track bill would be offset
by the loss of votes from another block of lawmakers who want to see trade
agreements kept clean.
� Free Trade Agreements
There are numerous free trade agreements in the works. First, the agreement
with Jordan is getting increasing press because it contains the
controversial labor and environment provisions demanded by Democrats.
Legislation to implement the pact has been introduced in the Senate,
and it is already being referred to as a pawn in the larger trade policy
debate over the role of labor and environmental issues in trade pacts.
Many members of the business community say the enforcement mechanisms in
the bill will result in trade sanctions, and have stated their opposition
to making this pact the prototype for future agreements. The Chamber of
Commerce has even announced it will actively oppose ratification of the
agreement.
Singapore is prepared to accept whatever labor and environmental
conditions the Bush Administration and Congress attach to a proposed bilateral
free-trade bill, according to the Singaporean trade minister. He added
that a free-trade deal between the US and Singapore is possible before
the end of the year.
Other agreements under consideration are the Free Trade Agreement of
the Americas, and free trade agreements with Vietnam, Chile
and Brazil.
USTR Zoellick was considering using a bundling approach to getting these
various trade initiatives passed by the Congress. In order to get Democrats
to support trade promotion authority, Zoellick was going to load the bill
up with other provisions they supported, such as the Jordanian agreement
linking trade sanctions to labor rights and environment standards.
Other initiatives considered were the renewal of Trade Adjustment Assistance
for US workers who lose their jobs to overseas competition stemming from
free-trade pacts, and help for the steel industry. It is important to note
that the United Steelworkers rejected this linkage outright by stating
that "There's no way we're going to allow our members' livelihoods to be
held hostage to the Administration's push for fast track." However, in
the face of united democratic opposition, Zoellick is back-pedaling on
the bundling approach.
� The Byrd Amendment
About 35 Members of Congress joined in a strongly worded statement to
USTR Bob Zoellick arguing that the Byrd Amendment does not violate trade
statutes as has been alleged. (This amendment, which was passed at the
end of the last Congressional session, sends proceeds from anti-dumping
and countervailing duties to injured and affected industries whose members
brought the original trade case rather than to the US Treasury.) In response,
the Bush Administration has indicated that they will fully implement the
law.
However, there are problems with implementation, according to the Customs
Service's Office of Regulations and Rulings. While the proposals for how
to run the new duty distribution program are almost complete, they still
must be approved by the Treasury Department before publication in the Federal
Register.
Additionally, Canada has raised some concerns about the provision because
under the NAFTA, the US is supposed to consult with Canada and Mexico when
amending its dumping or countervailing duty laws. No consultations took
place before the Byrd Amendment was adopted.
� China in the WTO
House Trade Subcommittee Chairman Phil Crane (R-IL) recently remarked
that unless China joins the WTO by June, an action very unlikely, Congress
will be forced to vote again on normal trade relations (NTR) with China.
President Bush will have to certify by June 3rd whether to grant NTR status
to China for another year, which could trigger another contentious vote
on Capitol Hill.
Additionally, Chinese trade officials have signaled that Beijing is
likely to delay China's accession to the WTO beyond October because rewriting
the country's domestic legal code to conform with WTO rules would take
a minimum of several months. And certainly the recent controversy regarding
the downed fighters will have a major political impact on these issues.
� WTO Ruling Against the US
The World Trade Organization (WTO) set a July deadline for the US to
change an 85-year old law aimed at penalizing low-priced imports. The WTO
ruled that by July 26, the US had to amend the 1916 Anti-Dumping Act that
gives courts the right to impose criminal and civil penalties on foreign
companies. The European Union (EU) and Japan could seek sanctions if the
US fails to comply.
The ruling backed a complaint by the 15-nation EU and Japan that the
law violates global trade rules because it allows for fines and imprisonment
for companies and individuals found guilty of dumping, as well as the payment
of damages. Under WTO rules, the imposition of tariffs is the only remedy
allowed to combat dumping.
The 1916 law had been dormant for decades and then revived by the steel
industry looking for ways to block steel imports during the Asian economic
crisis.
ENVIRONMENTAL/REGULATORY
� Effluent Limitation Guidelines
The AWPA Environmental Affairs Subcommittee members are currently drafting
comprehensive comments in response to the proposed Effluent Limitation
Guidelines (ELG) covering the Metal Products and Machinery (MP&M) industry
sectors. AWPA members will soon be receiving a sample set of comments to
assist them in drafting their own response to this onerous rule. The comment
deadline has been extended through July 2, 2001.
AWPA also submitted comments on the proposed ELG rule for the Iron and
Steel category once again requesting that the wire and wire products industry
not be moved from the Iron and Steel Point Source Category to the MP&M
Point Source Category. Our points noted that: our manufacturing processes
are virtually the same as steel producers; independent wire producers in
many cases are competing with integrated mini-mills who would be subject
to less stringent discharge limits; and for trade purposes, the wire industry
must be considered part of the steel industry.
To see a copy of the comments, go the AWPA website (www.awpa.org) members
section.
� Lowering of Lead TRI Reporting Threshold
AWPA recently added its name, along with 72 other associations, to a
Lead Industries Coalition letter to EPA Administrator Christine Todd Whitman
seeking to convince her to suspend or stay the TRI lead rule and allow
the Science Advisory Board to review the science issues before the rule
becomes effective. As a result, Whitman's top staff is giving the issue
serious consideration. The Senate Small Business Committee plans to hold
a hearing this month on the question of federal agencies' evasion of the
Small Business impact regulations, and the TRI lead rule will be one of
the rules spotlighted.
AWPA also submitted its own set of comments on this rule in conjunction
with a solicitation for industry input on how to improve the TRI program
overall. Our main concern was with a drastically lower threshold for reporting
of lead and lead compound materials. The final TRI reports will unduly
alarm communities of the amounts of dangerous substances being released.
The TRI numbers for lead will be far too high considering that reporting
will now have to be done at trace amount levels.
Additionally, we pointed out that much of the lead associated with our
industry is a component of the raw materials used. Even so, the rule would
require that these amounts of lead be reported despite the fact that during
the manufacturing process, it is not "separated," thus posing a release
to the environment.
� PM 2.5 Standard
The US Supreme Court recently ruled that the EPA's implementation of
its ozone standard was "unlawful" because the agency's exceeded its Clean
Air Act authority and sent it, and the particulate matter (PM) standard,
back to the lower court for review. This ruling means that EPA cannot enforce
its new rules until it proves to the Court of Appeals its clean air regulations
are reasonable, and submits new implementation plans to the court for approval.
This decision also allows the DC court to overturn the air quality standards
on other grounds. It is unlikely that any revised standards will take effect
in the near future.
However, in a blow to industry, the Supreme Court has ruled against
their arguments that EPA should have taken into account compliance costs
in setting the standards.
This battle with EPA's air pollution standards has now shifted to the
Congress. Senator George Voinovich (R-OH), Chairman of the Senate Clean
Air Subcommittee, plans to introduce a bill requiring new rules, including
those covering air quality issues, to be rooted in sound science and subject
to cost-benefit analyses, risk assessment and peer review.
The Clean Air Act requires the EPA to review national ambient air quality
standards every five years to ensure public health is protected. The rules
in question limit ozone (the main component of urban smog) to 0.08 parts
per million, compared to the current standard of 0.12 parts per million.
States also would have been required to regulate tiny particulate matter
as small as 2.5 microns, compared to the current standard of 10 microns.
� Limiting/Reporting HAPs
The compliance deadline is June 22, 2001 for the new, tighter Hazardous
Air Pollutant (HAP) standards for pickling facilities that use hydrogen
chloride and/or hydrochloric acid (HCl) regeneration plants. The standards
limit emissions of HCl from the scrubber to 18 parts per million by volume
(ppmv)
These standards apply to facilities defined as major sources of HAP.
A major source emits 10 or more tons per year of an individual HAP or a
combined 25 or more tons per year of two or more HAPs. Once a facility
has determined that it is subject to these new pickling standards, the
specific requirements are based on whether the facility is a new or existing
source.
Existing sources are facilities that started construction before September
18, 1997. Whether new or existing, the standards require that regulated
sources control HAP emissions by implementing maximum achievable control
technology (MACT). For more information on this standard, check out the
website http://www.newsteel.com/features/NS9912en.
In another HAP development, EPA is planning to establish requirements
for reporting estimated statewide emissions of dozens of hazardous air
pollutants (HAPs). As outlined in the regulatory preamble to the rule,
states would be required to report to EPA every three years on HAP emissions
the way they currently report on estimated emissions of particulate matter
and other "Criteria pollutants" under the Clean Air Act.
� Cabinet-Level EPA?
Senator Barbara Boxer (D-CA) recently introduced a bill entitled the
"Department of Environmental Protection Affairs Act of 2001" (S 159). Under
the provisions of the bill, the EPA would be redesignated as the Department
of Environmental Protection Affairs and be included as part of the president's
cabinet. The legislation would also dramatically strengthen the EPA's role
in negotiating international agreements.
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Alexandria, VA 22314-1757
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