The Senate Finance Committee listened politely as the 47-year-old foreign-policy whiz describe how important open trade is. Then it was the senators' turn to talk. Many proceeded to instruct him -- in blunt terms -- that his job would be to protect U.S. industries ranging from steel to lumber to catfish. The committee also told him to not back down in negotiations with Canada, China, and Europe over trade spats.
First on the committee's list of threatened U.S. industries was softwood lumber. A five-year agreement limiting Canadian softwood exports to the U.S. is due to expire at the end of March, which will likely bring a flood of Canadian softwood and damage U.S. suppliers, senators warned. Majority Leader Trent Lott (R-Miss.) complained that 100 U.S. mills have shut down recently because of cheap Canadian lumber and warned Zoellick not to be "bullied or cajoled" by doctrinaire free traders in the Administration who might not want to limit Canadian wood imports. "It's about time the State Dept. had an American Desk," said Lott.
CATFISH ADVANTAGE. Picking up on the patriotism angle, Senator Max Baucus (D-Mont.) said it would be "un-American" to advocate letting "subsidized" Canadian lumber damage the U.S. industry. "You need to make this your top priority," lectured Olympia Snowe (R-Maine).
Steel sympathizers, led by Senator John D. Rockefeller (D-W.Va.) told Zoellick to consider limits on steel imports. Zoellick promised to consider use of Section 201 of the U.S. trade laws, which would allow temporary tariffs on foreign steel to give time for the U.S. industry to retool -- a level of protection that the Clinton Administration had rejected. "We need to do a better job of enforcing laws against unfair trade," said Zoellick.
That led Senator Blanche L. Lincoln (D-Ark.) to note that not only is her state a large lumber and steel producer but it's also the largest producer in the U.S. of farm-raised catfish. Vietnam has been selling low-price catfish, harming Arkansas growers, she said. "Vietnam doesn't have to comply with EPA rules, but we do," complained the Senator, asking for an investigation on the international pricing of catfish.
FAST-TRACK DERAILMENT? For his part, Zoellick promised to look carefully at remedying each problem. But his top priorities, he told the panel, would include seeking new trade negotiating authority from Congress and a successful Summit of the Americas meeting in Quebec in April. There, the Bush Administration will seek to revive negotiations to fashion a hemispheric free-trade zone, he told the Senate Finance panel.
Trouble was, Democrats on the committee weren't buying. They lectured Zoellick to go slow in asking Congress to grant new trade negotiating authority to President Bush. Several said any legislation allowing the White House to reach deals and then submit them to Congress for a simple up or down vote without amendments -- the so-called "fast-track" method -- also would have to take into account the effect of trade on the environment and labor rights. "If it does not include labor and the environment, I will oppose that legislation," said Baucus, the top-ranking Democrat on the committee, which is evenly split between members of the two parties.
Definitely not music to the ears of a free trader such as Zoellick. It looks like he'll have his work cut out for him if, as expected, he's confirmed as USTR. By Paul Magnusson in Washington