The New American: Talking With Duncan Hunter

8/14/2019 The New American: Talking With Duncan Hunter

1/6

THE NEW AMERICAN MAY 14, 2007

Interview of Congressman Duncan Hunter

Congressman Duncan Hunter of Cali-fornia is one of the few Republicanmembers of Congress with the dis-

tinction of having voted against both theNAFTA and CAFTA trade agreements. Hiscongressional district in the San Diego areashares a border with Mexico. He is currentlycampaigning for the GOP presidential nomi-nation. We caught up with him on PatriotsDay at Washingtons Capitol Hill Club inbetween weekend trips to South Carolina tocampaign for the upcoming presidential elec-tion. The early primary state, which has seenits textile industry devastated by trade-deal-greased off-shoring, will host the first tele-vised GOP presidential candidate debate onMay 15.

Congressman Hunter was interviewed byJim Capo, national spokesman for the JohnBirch Society on trade policy.

THENEWAMERICAN:Congressman Hunter, akey issue that sets you apart in the GOP presi-dential race is your position on U.S. trade pol-icy. Why have you opposed trade agreementslike NAFTA and CAFTA?Rep. Duncan Hunter: I see these agreementsas business deals. NAFTA was a bad businessdeal. We gave up something of value, theAmerican market, and got essentially noth-

ing in return. We were promised that NAFTAwould develop a Mexican middle class thatwould buy Kenmore washers and Cadillacs.The promise was also made that NAFTAwould stem the tide of illegal immigration.Instead, NAFTA destroyed many small busi-nesses and farms in Mexico that were incu-bators of a potential middle class in Mexico,and we have seen illegal immigration surge.Similar unrealistic promises were made forCAFTA.

Let me say here one more thing about howthese trade deals are bad business deals. The

1946 General Agreement on Tariffs and Trade[GATT] was upgraded to the World TradeOrganization a year after NAFTA. When theGATT was created, the United States alloweda loophole for something called the VAT the Value Added Tax. Almost all of ourtrading partners use a VAT to put U.S.-basedmanufacturers at a significant disadvantagein all these so-called free-trade deals we aresigning. Right now it has been calculated thatthe VAT system creates up to a $327 billionannual disadvantage for the United States just

22

RepublicanpresidentialhopefulRep. DuncanHunter (R-Calif.)

APImages

INTERVIEW

Congressman Duncan Hunter, one of the few

Republican members of Congress to vote against

both the NAFTA and CAFTA trade agreements,

answers questions about U.S. trade policy and more.

Talking withDuncan

Hunter


2/6


in manufacturing goods, not including ser-vices. This is almost half our ballooningyearly trade deficit.

TNA: Since you bring it up, can you give usthe nickel version of how the VAT works?Rep. Hunter: In simplest terms the VAT isa tariff-and-subsidy scheme masqueradingas a GATT/WTO compliant tax. Here isan example of how it works. China has aVAT of about 17 percent. Under the VATsystem, a manufacturer produces a tablethat costs $100. If that manufacturer shipsthat table out of the country to the UnitedStates, that manufacturer is rebated $17 oftaxes that were collected along the manu-facturing supply chain in China under theVAT system. The manufacturer can thendeliver that table to the United States for

$83. When a U.S. manufacturer wants toship a similar table into China he gets abill for $17 at the Chinese border, so thecost of his good now becomes $117. Thismeans that before the opening kickoffin this international competition we callworld trade, the other side has 34 pointson the scoreboard before the game evenbegins! That is a built-in disadvantage wehave signed up to.

TNA: On Capitol Hill there seems to be amovement to address the situation. Are you

aware of a bill called the Border Tax Eq-uity Act that is soon to be introduced? Thisbill calls for countervailing taxes to be as-sessed to VAT countries in an effort to levelthe playing field for U.S. manufacturers.Rep. Hunter: I am very much aware ofthat bill, and I will proudly be addingmy name to it as one of the initiating co-sponsors. We are not going to continue toplay the global trade game at a built-indisadvantage. I know there will be manyU.S. companies that will resist this effortbecause they have already moved their

production outside our country to take ad-vantage of this designed-in disadvantagefor U.S. producers, but we have to beginthe process of rebuilding our countrysmanufacturing base. No country can re-main strong and successful without one.Two years ago when we went looking forhigh-grade armor steel plate to protect oursoldiers against IEDs in Iraq, we foundthat there was only one supplier left inthe United States for this critical item. Wehave to do better.

TNA: You mentionedChina in your VAT ex-ample. Is that countrya particular concern?Rep. Hunter: As therecent former Chair-man of the HouseArmed Services Com-mittee, I am verymuch concerned aboutChina. The Chinese arearming with Americantrade dollars. They areexpanding their mili-tary capabilities. Theyhave bought missiles from Russia that willallow them to destroy aircraft carriers.They are building next-generation fighterjets. The tragedy is that at some point in

the future, American military personnelmay end up facing off against equipmentthat was purchased through our trade defi-cit with China.

TNA:Was this what led you to introducethe Hunter-Ryan/Fair Currency Act (H.R.1498)?Rep. Hunter: In a large part, yes. TheChinese yuan has been pegged to the

U.S. dollar. Despite a slight revaluation in2005, the yuan remains undervalued by asmuch as 40 percent. The Chinese govern-ment is cheating. The legislation that Con-

gressman Ryan and I have offered definescurrency manipulation as an illegal tradesubsidy. This practice, when coupled withother tariffs and trade penalties, creates anuneven playing field and a one-way streetfor trade. This one-way street heads rightto China.

TNA:What are the prospects for this bill?Rep. Hunter: It will be difficult. The multi-

23

Republican presidential hopeful Duncan Hunter (R-Calif.) espouses smart trade policywith China to level the playing field between our two countries, instead of continuing thepresent policies that give China an advantage even before the trade games commence.

APImages

NAFTA is not a glorious, honorableprogram. It is not innovative,creative, or courageous. It is aretreat. It is a retreat of American

industry away from all the problemsthat we have caused in overregulation [and] heavy taxes.

Congressman Duncan Hunter,during debate on NAFTA in 1993


3/6

24

nationals in our country are saying, Wait aminute. We are Chinese corporate citizens.We like the situation as it is. Honestly, wewill need more businessmen to put Americafirst. I was encouraged by the recent splitin the National Association of Manufactur-ers (NAM) over the currency-manipulation

issue. There are still many patriots in theUnited States business community, andthey are speaking out. We need more to stepforward. American business advisers areadvising American manufacturers to packup and leave our shores for tax and tariffpurposes. A major part of my presidentialcampaign is to restore our nations manu-facturing base. As president of the UnitedStates, Ill junk bad trade deals and bringcompetitors back to negotiate new ones.

TNA:Our trade deals have all been nego-

tiated under the Trade Promotion Author-ity (TPA) or fast track that Congresshas given to the president. The currentTPA runs out on June 30 of this year. Whatis your position on TPA renewal?Rep. Hunter: Im not supportive of TPA.In fact, I wont support TPA. We donthave people that are competent working onthese deals. In the private sector, if we hadnegotiators who promised us so much anddelivered so little, we would not be doingbusiness with them any longer. NAFTAunder President Clintons negotiation team

was bad. President Bushs team has notchanged much. They are not interested indoing a good job for us. Leaving it to theadministrations trade team is not work-ing. I understand that it is not efficient tonegotiate a deal by committee (as in theCongress), but we need another path.

TNA: Are you aware that NAFTA is beingexpanded under the Security and Prosper-ity Partnership, and that the creation ofsomething like a North American Union

and a NAFTA Superhighway is being dis-cussed outside the oversight of Congress?Rep. Hunter:Yes, I have recently becomeaware of this effort, and in no way do Isupport it.

TNA: Are you supporting Virgil Goodes

bill, House Concurrent Resolution 40,which calls on the president to stop workon the North Ameri-can Union and NAFTASuperhighway?Rep. Hunter: Yes. Isupport the Goode bill.My name is being addedas a cosponsor. Alongwith Marcy Kaptur [D-Ohio], I have also intro-duced a bill called the

NAFTA Safe TruckingAct. This bill requiresthat Mexican motor car-riers attempting to oper-ate in the United Statesmeet all the same safetyrequirements U.S. com-panies and drivers arerequired to meet. It alsorequires that they canaddress all our secu-rity concerns regardingtruck shipments coming

into the United Statesfrom Mexico. Addition-ally, under the bill noMexican carrier will beallowed to operate free-ly in the United Statesuntil the Secretary ofTransportation has sub-mitted to Congress aplan to enforce Englishlanguage proficiency asalready required.

TNA: Regarding security on our borderwith Mexico, what is your assessment ofthe situation for U.S. Border Patrol agentsRamos and Compean, who were arrestedand jailed for shooting and woundinga Mexican drug smuggler whom theythought was armed?Rep. Hunter: I read the relevant tran-scripts of their trial, and I came to theconclusion that their convictions andsentences were an extreme injustice. Wehave sent the wrong message to those pro-tecting our borders. When the presidentdidnt pardon them, I introduced a bill fora congressional pardon, H.R. 563. Thebill currently has 94 cosponsors. Thesemen have been unjustly imprisoned....Upon being elected president, if Ramosand Compean are still tragically in jail, I

will pardon them.


Three pillars: As Duncan Hunter (R-Calif.) campaigns forthe presidency, he pushed three main issues: smart tradepractices to restore American manufacturing, strategicnational defense, and strong border security.

A P I m a g e s

INTERVIEW

Let us vote NO on NAFTA so that the averagewage earner in this country, when he sits at thedinner table with his family after a days work athis job, can say of the House of Representatives,

the United States Congress, It works for us. Congressman Duncan Hunter,

during debate on NAFTA in 1993


4/6

THE NEW AMERICAN MAY 14, 2007 25

President Bush wants Trade Promotion Authority for the sake of free trade, but there is

a growing grass-roots resistance to the harmful consequences of his trade agenda.

Why BushWants TPA Extended

by Jim Capo

Without action by Congress, theTrade Promotion Authority(TPA) powers of the president

will expire at midnight on July 1. Thisauthority, formerly known as Fast Track,was first extended by Congress to Presi-dent Nixon with the Trade Act of 1974. Ithas been used to place the United Statesin such trade pacts as the North Ameri-

can Free Trade Agreement (NAFTA), theWorld Trade Organization (WTO), and theCentral American Free Trade Agreement(CAFTA).

Although the TPA powers have beenemployed by both Republican and Demo-crat presidents to get trade pacts throughCongress, the TPA-spawned pacts col-lectively advance a similar agenda. Thatagenda is euphemistically called freetrade by its promoters, despite the factthat it is not genuine free trade. Genuinefree trade entails the free flow of goods

without any outside government involve-ment. But when the fine print of tradeagreements is fully explored, it becomesclear that the TPA trade-agreement pro-cess is not about eliminating governmentinvolvement but about who will make therules. Put simply, the agreements restrictthe ability of the United States to set itsown trade policies by transferring deci-sion making to regional and global ar-rangements as part of a broader agendacalled globalization.

Consider the binding nature of NAFTAs

Chapter 11 tribunal rulings, which manycongressmen did not even notice whenthey voted for NAFTA in 1993. In April2004, with these tribunals established andissuing rulings, theNew York Times quotedCalifornia Supreme Court Chief JusticeRonald George as warning: There aregrave implications here. Its rather shock-ing that the highest courts of the state andfederal governments could have their judg-ments circumvented by these tribunals.

President George W. Bush supports

the free trade agenda. He also wants tocontinue using Trade Promotion Author-ity to advance that agenda and has called

on Congress to extend his TPA authority.But there has been growing grass-rootsresistance to the TPA-spawned agree-ments based on both their economic con-sequences and their neutering of U.S.sovereignty.

The Free Trade AgendaU.S. adoption of the NAFTA agreementin 1993 under fast track rules provideda foundation for the so-called free-tradeagreements that followed as former

Secretary of State Henry Kissinger pre-dicted when the NAFTA agreement wasstill being debated: [NAFTA] will repre-

sent the most creative step toward a newworld order taken by any group of coun-tries since the end of the Cold War, andthe first step toward an even larger visionof a free-trade zone for the entire WesternHemisphere.... [NAFTA] is not a conven-tional trade agreement, but the architectureof a new international system.

President Bush supports NAFTA andwants to build upon it. NAFTA hasworked, he claimed last March 14 in Mex-ico. You dont want to weaken NAFTA;

President Bush signs the Central American Free Trade Agreement in 2005. The agreementhas earned criticism because it both opens up foreign markets to some subsidized U.S.agricultural products, putting out of business small farm interests in largely agrarian ThirdWorld countries; and it promotes the outsourcing of U.S. manufacturing jobs overseas.

TRADE PROMOTION AUTHORITY

APImages


5/6


you want to make sure it stays strong inorder that prosperity continues to expandand people benefit on both sides of the bor-der. Of course, that rosy assessment of aNAFTA economic boom contrasts sharplywith the mounting evidence of economicdevastation wrought by NAFTA and otherso-called free-trade agreements. Last year,for instance, an Economic Policy Institutebriefing paper about NAFTA found thatgrowing trade deficits with Mexico andCanada have pushed more than 1 millionworkers out of higher-wage jobs and intolower-wage positions in non-trade relatedindustries. The paper also found that thedisplacement of 1 million jobs from tradedto non-traded goods industries reducedwage payments to U.S. workers by $7.6billion in 2004 alone.

President Bush disagrees that NAFTAhas been bad for the economy as a whole,and in 2005 he strongly lobbied lawmakersto get a similar trade agreement, CAFTA,through Congress, extending the NAFTAconcept to Central America.

But the president does at least ac-knowledge that some American workershave lost their jobs despite the economicboom he credits to NAFTA. He wants tohelp those displaced workers, but not bybacking away from his trade agenda. Inhis January 31 State of the Economy Re-

port, delivered at New York Citys Fed-eral Hall, he explained: Government hasa responsibility to help displaced workersfind new jobs, or even a new career. So myadministration has reformed job trainingprograms and expanded Trade AdjustmentAssistance to help more displaced workerslearn the new skills they need to succeed.Im going to work with Congress to reau-thorize and to improve the Trade Adjust-ment Assistance this year, so we can helpAmericans take advantage of this growing,dynamic economy.

In the same speech, President Bushproudly pointed to his success at imple-menting his trade agenda: When I tookoffice, America had free trade agreementswith three countries. We have free tradeagreements in force now with 13 coun-tries and we have more on the way.Also on the way is a strengthening ofthe WTO. As the president put it in hisspeech: At this moment, the most prom-ising opportunity to expand free and fairtrade is by concluding the Doha Round at

the World Trade Organization.However, President Bush pointed

out: The only way America can com-plete Doha and make headway on othertrade agreements is to extend TradePromotion Authority.... The authorityis set to expire on July 1st and I askCongress to renew it.

Whats Wrong With TPAUnder fast-track legislation, the Con-gress surrenders some of its consti-tutionally authorized power to theexecutive branch, diminishing therole of Congress (and of the peopleacting through their congressmen) insetting trade policies, and expandingthe influence of the executive branch(and the special interests that have

strongly influenced the presidency dur-ing both Republican and Democraticadministrations).

Trade Promotion Authority allows apresident not only to negotiate a particu-lar trade agreement but also to implementlegislation needed to bring existing U.S.law into conformity with the agreement.This violates not only the constitutionalmandate that All legislative powersherein granted (Article I, Section 1) beexercised by Congress alone, but also thatCongress not the president regulate

commerce with foreign nations (ArticleI, Section 8).

Moreover, fast track hamstrings Con-gress by requiring that it: 1) limit debate toa maximum of 20 hours; 2) vote within 60legislative days after both the agreementand its implementing legislation havebeen presented by thepresident; and 3) voteyea or nay on the exacttext submitted by thepresident without al-tering or amending.

Great pressure is ap-plied then to membersof Congress to passthe agreement, by theWhite House and cor-porate lobbyists, withextravagant claimsabout the benefits tobe reaped by increasedtrade and, conversely,the dire consequencesthat will befall the

United States economy, competitiveness,and international stature if they fail to ex-peditiously approve it.

The fast-track authority also enablesthe president, with the cooperation ofCongress, to circumvent the Constitu-tions treaty-making power. Advocates offast-track authority want free-trade agree-ments to be negotiated by the president asthough he were exercising his valid execu-tive power to make treaties. However,our Constitution requires that treaties beapproved by a two-thirds majority of the

Senate, not by a simple majority of Houseand Senate members who have been boundand gagged by TPA rules.

Because of the nature of the fasttrack process, it is not surprising that ithas produced a series of trade pacts thathave been (despite administration claims

TRADE PROMOTION AUTHORITY

APImages

APImages


6/6

THE NEW AMERICAN MAY 14, 2007 27

to the contrary) damaging to our economyand national independence. But a growingnumber of Americans is coming to realizethe danger, and the president will not havean easy time getting TPA extended, if hesable to get it extended at all.

Among those opposing TPA is the pro-American industry organization Ameri-can Trade Action Coalition (AMTAC),whose executive director, Auggie Tan-tillo, observed in a January 31 press re-lease, TPA is the blank check Congressgives to the Executive Branch to offshore

entire U.S. industries. Recognizing thatCongress as well as the president is partof the problem, Tantillo added: TPA isCongress way of passing the buck toavoid accountability. By stifling meaning-ful debate and all amendments, TPA per-verts the legislative process by effectively

preventing negatively affected industriesand interests from airing their concerns inCongress. Such an outcome only servesto promote the special interests who writethe biggest campaign checks at the ex-pense of the will of the majority of theAmerican people.

On the whole, Bushs fellow Repub-licans in Congress have gone along withhim. On the other hand, with a Repub-lican president in the White House, theDemocrats have been very resistant to thepresidents trade policies. When the House

passed CAFTA in 2005, for instance, only15 Democrats voted yea. (By contrast,102 House Democrats voted for NAFTA in1993 when Bill Clinton was president.)

But Democratic congressional opposi-tion to the presidents trade policies coulderode if the pacts submitted to Congress

are expanded to include labor standardsset by the UNs International Labor Or-ganization as well as environmental stan-dards. On March 27, Rep. Charles Rangel(D-N.Y.), chairman of the House Waysand Means Committee, and Rep. SanderLevin (D-Mich.), that panels trade sub-committee chairman, unveiled a proposalto modify pending trade pacts along thoselines. Their proposal has the support ofthe Democratic leadership. Labor groupsalso praised the document, according toCongressional Quarterly, but expressedskepticism that the administration wouldaccept the Democrats position.

By linking the extension of trade pactsto labor issues, organized labor is actuallyhoping to have it both ways. Many labor-union officials would like to empower a

supra-national labor tribunal (or panel)to strike down state right to work lawsin states that ban collective bargaining ofunions. However, they do not want otherinternational tribunals decreeing that statelaws which favor sourcing work to unionshops are a restriction of free trade.Once again, its a question of who makesthe rules.

Expanding the trade pacts beyond tradeto include labor and environmental stan-dards would actually make these pactsworse, not better, from the point of view

of any American who, regardless of hisposition about free trade or protectionism,wants the United States to be able to setits own policies and write its own lawswithout being further hamstrung by in-ternational regulations or tribunals. How-ever, the expansion of the so-called free-trade pacts beyond trade fits nicely withthe goal of the political elites to transfermore economic and political power to re-gional and global arrangements, includ-ing a proposed North American Unionmodeled after the EU.

To move his trade agenda forward, Pres-ident Bush needs TPA extended. Whetheror not a majority of congressmen vote forthat extension, and also vote for pendingand future free trade agreements withor without labor and environmental stan-dards, will ultimately be shaped not onlyby pressure from the White House and thespecial interests, but also by the oppos-ing pressure from informed constituentswhove had a belly full of destructivetrade agreements.

Dynamite under thetrack: U.S. TradeRepresentative SusanSchwab, shown at ameeting of key member-nations of the WorldTrade Organization inApril, said that withoutpresidential fast-tracktrade authority, thecontinued creation of newtrade blocs and dealswould be stymied.

Details, details: Prominent NewYork Timescolumnist ThomasL. Friedman (right) claims heloves all free trade dealsbecause he knows free trade isgood. Like so many other free-

trade advocates, however, heignores the fact that our tradeagreements are conditionaltrade agreements wheregovernments essentially choosewhich industries will be winnersand losers.

Documents

The New American: Talking With Duncan Hunter