Editor’s note: James A. Morrissey Sr., 81, died peacefully in his sleep Saturday,
Sept. 4, 2010, at his home in Potomac Falls, Va. He is survived by his wife of 51 years, Constance
M. Morrissey; four children, James A. Morrissey Jr., Erin M. Ingrisano, Patrick E. Morrissey and
Michael C. Morrissey; 10 grandchildren; and sister, Marilyn Roberts. Morrissey was a long-time
contributor to
Textile World, holding the position of Washington correspondent following a
28-year career as director of communications for the American Textile Manufacturers Institute. He
also is a member of the Public Relations Society of America Hall of Fame.

Morrissey will be greatly missed by
TW staff and the readers of his bimonthly “Washington Outlook” column and his
weekly online reports from Washington. If you have remembrances of his contributions to the textile
industry that you would like to share with TW, please email your thoughts to
Morrissey@TextileWorld.com.

W
hile U.S. textile and apparel companies are setting their sights on increasing exports,
it has become clear they will not get very far without more support from governments here and
abroad. The Obama administration is committed to doubling U.S. exports over the next five years,
and while that goal is laudable, it is easier said than done. As textile and apparel imports
continue to rise, many companies see exports as the only route to survival.

With more than $12 billion in exports annually, the U.S. textile industry already is the
third-largest textile exporter globally. Because most textile and apparel manufacturers are
considered small to medium-sized companies, many lack resources to move in a big way into overseas
markets and significantly increase their exports. However, yarn and fabric makers have experienced
considerable success doing business in countries with which the United States has preferential
trade agreements, such as the North America Free Trade Agreement (NAFTA) and the Central
America-Dominican Republic Free Trade Agreement (CAFTA-DR). That arena is where future
opportunities lie.

Assistance Sought


U.S textile makers have urged the government to pave the way for more exportation. Measures
include: working with other nations to reduce trade barriers; calling on other governments to
eliminate subsidies, including currency manipulation, to their manufacturers; increasing Customs
enforcement, particularly with regard to preferential trade agreements; and making credit and other
financing available to companies that want to export their products. In addition to these steps,
U.S. apparel makers support ratification of the Panama, Colombia and South Korea free trade
agreements (FTAs), which they say would provide access to 100 million new customers. They also call
for successful conclusion of the Doha Round of trade liberalization negotiations and negotiation of
a Trans-Pacific Partnership.

Financial Support


Access to financing has become both an immediate and a long-range need for exporters. In a
letter to U.S. Trade Representative (USTR) Ron Kirk, Cass Johnson, president of the National
Council of Textile Organizations (NCTO), pointed out that U.S. textile makers “have experienced
tremendous difficulty” in securing financing through private lenders as well as from the
Export/Import Bank (Ex-Im Bank). He said the problem is compounded by the fact that many overseas
countries offer their exporting industries cheaper financing, giving them a competitive advantage.
As private financing is expensive or not available at all, manufacturers have turned to the Ex-Im
Bank, which provides credit guarantees, credit insurance and financing to U.S. exporters. This,
however, has turned out to be an exercise in futility in many cases.

The problem is with the Ex-Im Bank’s criteria for assessing risk. When offering credit
insurance, the bank affixes a risk based on the country receiving the exports, and the bulk of U.S.
textile exports go to NAFTA and CAFTA-DR nations — many of which are considered high-risk. This
results in costs associated with credit insurance or guarantees that are prohibitively high for
textile manufacturers.

Gail Strickler, assistant USTR for textiles, said the Office of the USTR is well aware of
this problem and is trying to resolve it. She told Textile World her office has been working to
have risk assessment based on the credit record of the ultimate U.S. customer or the U.S. exporter
rather than on the credit assessment of the importing country. While many of the NAFTA and CAFTA-DR
countries are considered credit risks, the ultimate consumers of textiles and clothing entering the
United States under preferential programs — such as Walmart, Sears, and JCPenney — pay their
bills and are not viewed as credit risks.

Strickler said the USTR has been working for months with the Ex-Im Bank and private factors
to urge them to reassess their risk criteria and make the financing of exports less expensive. She
noted that on a number of occasions, her office has been able to step in and help companies get
better financing, and while there has been some success, she said, “we still have a long way to
go.” U.S. textile manufacturers have seen little movement in this regard, but they consider
financing problems a major deterrent to exporting, and they feel more needs to be done. Strickler
is urging companies experiencing financing problems to contact her office to seek assistance.

Johnson told the USTR that if NCTO’s recommendations in connection with the National Export
Initiative are implemented, the goal of increasing exports from today’s $12 billion to $24 billion
“is within reach.”

Korea FTA Reopened


Because the two most powerful members of Congress in terms of trade issues have problems
with the United States/South Korea FTA (KORUS), the Obama administration has been forced to reopen
negotiations, and that is providing an opening for U.S. textile lobbyists to seek modifications in
the pact, which they say in its present form could have “a profound negative effect” on textile and
apparel jobs. The FTA was signed by the Bush administration in June 2007, but Congress has refused
to ratify it. Senate Finance Committee Chairman Max Baucus from the beef-producing state of Montana
and Sander Levin, House Ways and Means Committee chairman from Michigan, the heart of automobile
manufacturing, have problems with how the agreement treats U.S. beef exports and automobile imports
and market access.

Five textile industry associations and the Service Employees International Union have
written to Kirk calling for major changes in the tariff phase-out schedule, Customs enforcement and
the rule of origin. The Congressional Textile Caucus has raised the same issues, saying the current
agreement will place domestic manufacturers at “a distinct disadvantage.” Its members call for the
United States to revisit the agreement and revise the textile provisions, which they say could
“cause great harm to the domestic industry.”

Kirk said he hopes outstanding issues can be resolved by President Barack Obama’s scheduled
trip to South Korea in November, but he told a South Korean newspaper it is unlikely that any
sections of the agreement other than beef and autos will be reopened. That’s not likely to deter
textile manufacturers and their supporters in Congress from pressing for reforms in the textile
sections. While some issues may be resolved by Obama’s meetings in South Korea, legislation
enacting the agreement into law, from a practical standpoint, could not be passed until next year.

Possible Action On Currency Issue


As the November election draws closer and members of Congress are anxious to show they are
doing something to create jobs, there is an increasing possibility that Congress will act on
Chinese currency manipulation. Up to this point, currency reform legislation pending in Congress
has served to put pressure on the Obama administration and the Chinese government to permit the
Chinese renminbi to appreciate against other currencies, but the tentative steps taken by the
Chinese government to date have not impressed members of Congress. The legislation would declare
currency manipulation an unfair practice and permit use of anti-dumping and countervailing duty
laws to offset what the legislation’s supporters see as an illegal subsidy. The call for
congressional action was intensified by a Department of Commerce decision saying countervailing
duties could not be viewed as an illegal subsidy in an aluminum industry case.

September/October 2010
]]> https://www.textileworld.com/textile-world/washington-outlook-archive/2010/07/trans-pacific-trade-pact-moving-forward/ Mon, 19 Jul 2010 06:30:00 +0000 http://ec2-54-210-48-17.compute-1.amazonaws.com/uncategorized/2010/07/trans-pacific-trade-pact-moving-forward/

Battle lines are being drawn between textile manufacturers and importers as the United States and
seven other nations move forward

with negotiation of a Trans-Pacific Strategic Economic Partnership Agreement (TPP) that the
U.S. government says is intended to “dramatically increase” U.S. exports to the Asia-Pacific area.
The Obama administration is seeking to develop what it calls a “high standard 21st Century regional
trade agreement” with Australia, Brunei, Chile, New Zealand, Peru, Singapore and Vietnam.

As the second round of negotiations was concluded in mid-June in San Francisco, government
officials, importers and textile manufacturers saw the agreement in an entirely different light.
With much of the preliminary discussions out of the way, the participating countries expected to
get down to serious negotiations this fall. They have created nine issue negotiating groups
including one on textiles.

It is apparent that stakeholders in the United States believe the pact presents both
opportunities and pitfalls, and they are working with the U.S. Trade Representative (USTR) and
members of Congress to address their issues.

The National Textile Association (NTA), for example, has told the USTR it does not think the
agreement will result in a significant increase in market access for U.S. textile products; and, in
fact, it believes the pact could result in severe disruptions in the U.S. industry. NTA is
concerned that the TPP will undermine a two-decades-long consensus on textile rules of origin in
preferential trade agreements in which the United States is a partner. It views the pact as a
“continuation of failed trade policies tilted in favor of foreign partners at the expense of
domestic interests.”

While saying it is difficult to gauge the impact of the agreement at this time because key
details have not yet been negotiated, the National Council of Textile Organizations (NCTO) is
particularly concerned about including Vietnam in the agreement, claiming that because of its
non-market economy, Vietnam will become “another China.” In a filing with the USTR, NCTO President
Cass Johnson said including Vietnam is “a bad policy move” that encourages the “China model” of
export dependency that will lead to higher trade deficits for the United States and more U.S.
textile job losses, as well as apparel job losses in other Western Hemisphere nations. At the
moment, Vietnam is participating in the negotiations as an “associate member,” and there reportedly
are some concerns about whether it wants to participate fully, as it would be forced to meet labor
and other requirements that it may not be willing to adopt.

In addition, Vietnam is on the U.S. watch list of countries that the United States does not
feel have acceptable safeguards against violations of intellectual property rights.

Apart from the Vietnam issue, Johnson also made an appeal for a strong yarn forward rule of
origin and effective Customs enforcement.

On the other hand, the National Retail Federation (NRF), whose members are among the largest
importers of textiles and apparel, certainly wants to include Vietnam along with the other
countries, as  it sees “significant market access opportunities.” NRF says Vietnam has become
an important supplier to the U.S. market, and in some cases, its members see Vietnam as an
alternative to sourcing in China. The federation also says that including Vietnam in the agreement
would assist in moving Vietnam away from a centrally planned economy to a market economy.

In addition, NRF sees the TPP as an opportunity to change the textile rules of origin, which
it has long opposed for being so complicated and restrictive as to negate the benefits of
preferential trade agreements.

The retailers group also sees an opportunity to solve problems with anti-dumping and other
trade remedies in the United States and other countries – problems that it says constitute barriers
to developing viable retail operations. NRF suggests that one good start would be to exempt free
trade agreement (FTA) partners from anti-dumping laws.

The American Apparel and Footwear Association (AAFA) says the TPP can present new market
opportunities, particularly in Vietnam, Brunei and New Zealand, with which the United States
currently does not have FTAs, as U.S. branded products would qualify for duty-free status in what
it says are some of the fastest-growing and richest nations in Asia and the Pacific. AAFA says the
agreement would “foster alternative sourcing opportunities” for U.S. clothing and footwear for
companies that are interested in developing new supplier opportunities.

It also believes the TPP would promote business certainty and investment predictability in
the participating countries.

All in all, importers see some positive opportunities, while textile manufacturers are wary
of the final outcome.

What About Chinese Currency?


Although China made a bunch of headlines with its recent announcement that it plans to move
forward with what it says will be “reforms” in its currency exchange rate, no one expected anything
very significant to happen soon.  Although President Barack Obama and Treasury Secretary
Timothy Geithner praised the announcement as “a constructive step,” industry and congressional
critics of China’s currency policies were not very impressed.

Sen. Charles Schumer, D-N.Y. — who, along with 18 other senators, is sponsoring legislation
that would impose stiff tariffs on Chinese imports if China does not reform its exchange rate in a
meaningful way – described the Chinese announcement as “a vague and limited statement of
intentions.”

House sponsors of currency reform legislation held a rally on Capitol Hill and called on
China to “immediately end its currency manipulation.” Rep. Tim Murphy, R-Pa., one of the lead
sponsors of currency reform legislation in the House, said: “Exports from China are artificially
cheaper than products from international competitors because of currency manipulation. The
manipulation of currency and subsidizing of industry by China has put American workers at a
competitive disadvantage. We cannot just take China’s word that its policies will change. It is
time for America to act.”

Charles Blum, executive director of the Fair Currency Coalition, which includes textile
industry members, said at the rally that “a persistently undervalued renminbi acts as both an
export subsidy and trade barrier by making Chinese goods less expensive than their American
counterparts.” He dismissed China’s move to make its currency more flexible as falling far short of
what is needed, saying that if China permits the renminbi to rise by 3 to 5 percent over the next
few months, “it would come nowhere near close to eliminating the renminbi’s estimated 35 to 40
percent undervaluation relative to the U.S. dollar.”

Despite all the sound and fury, the Obama administration and China are most likely to
continue pursuing a diplomatic solution to the problem.

Textile Manufacturers See Hope For Customs Reform


U.S. textile manufacturers are optimistic that Congress will enact legislation that would
give government trade officials new authority, direction and resources to do a better job of
attacking illegal imports of textiles and apparel. The first-ever textile-specific Customs
legislation has the backing of a strong bipartisan coalition in the House, and the idea is gaining
support in the Senate.

 

The legislation would give Customs expanded authority to seize illegal imports; provide ways
to attack undervalued imports that escape their true tariff assessments; direct the appointment of
textile specialists at high-traffic ports of entry; establish a system for electronic verification
of shipments; create an Office of Textile and Apparel Trade Enforcement within the Department of
Justice to carry out enforcement cases; and mandate the government to publish the names of
companies that intentionally violate the rules of trade agreements. The textile trade bill also
allows the Department of Homeland Security to use fines and penalties to help pay for additional
investigating and training.

The United States is the world’s third-largest exporter of textile products, with such
exports valued at more than $13 billion last year. With the majority of these exports going to free
trade agreement and other preference program participants, the industry relies heavily on strong
Customs enforcement for its livelihood. The National Council of Textile Organizations (NCTO) claims
that during the past decade, the industry has seen “a disturbing increase in fraudulent activity”
in which mislabeled goods slip by Customs and mistakenly are permitted to qualify for the duty-free
treatment accorded participants in preferential programs. NCTO believes the Textile Enforcement and
Security Act of 2010 will close many of the loopholes that permit fraudulent textile trade.

July/August 2010

Is a sleeping bag a textile product?

The Obama administration says it isn’t, but textile manufacturers say it is.

The controversy stems from the release by the U.S. Trade Representative of the latest
Generalized System of Preferences Review, in which the government denied a petition from Exxel
Outdoors, a manufacturer of sleeping bags, to have them classified as textile products. The
decision will allow overseas manufacturers to avoid a 9-percent tariff on a wide range of products,
including sleeping bags, that are not classified as textile products.  Congress created the
Generalized System of Tariff Preferences (GSP) in the Trade Act of 1974 to help developing
countries expand their economies by allowing certain products into the United States tariff-free.
However, textile and apparel products have been excluded from the preferential treatment because of
their import sensitivity and because developing countries often have been significant exporters of
those products.

The American Manufacturing Trade Action Coalition (AMTAC) is up in arms over the decision,
claiming it fails to recognize that sleeping bags are textile products and refuses to recognize the
economic threat to U.S. manufacturers of continuing to provide duty-free treatment to sleeping bags
from developing countries.

Saying he is “incredibly disappointed” with the decision, AMTAC Executive Director Auggie
Tantillo pointed out that textile components including the fiber fill, outer-shell fabric and
sewing thread account for 96 percent of the weight and 90 percent of the value of a sleeping bag.
He also said the case gave the Obama administration an opportunity to create American jobs, but
instead favors foreign manufacturers. Tantillo called on President Barack Obama to reconsider his
decision and “properly designate” sleeping bags as textiles.

July 6, 2010

In recent weeks, there has been more talk along that line from Chinese government officials
and economists.

By linking the yuan to the dollar, China makes its exports cheaper and imports more
expensive, something U.S. manufacturers maintain is an illegal trade subsidy.

Although members of Congress continue to urge the Obama administration to brand China a
currency manipulator and take action under U.S. trade laws and impose sanctions, the administration
continues to call for a diplomatic approach, not only with China, but with other countries as well.
Treasury Secretary Timothy Geithner has said there are some high-level meetings coming up in the
next three months at which there will be opportunities to address the issue with policies “that
will help create a stronger, more sustainable and more balanced global economy.” Geithner said
China’s inflexible exchange rate has made it difficult for other emerging market economies to let
their currencies appreciate, and a move by China to a more market-oriented exchange rate will make
an essential contribution to global rebalancing.

However, during a recent visit to Beijing, Commerce Secretary Gary Locke said that even if
China permits its currency to float, the impact will not amount to much unless China removes some
of its trade barriers. “It’s like two steps forward and one step back,” Locke said. “They can
revalue their currency, but if they have market barriers or if they favor domestic companies, then
that revaluation of currency will not make much of a difference.” Federal Reserve Board Chairman
Ben Bernanke also indicated that the U.S. problems with China trade go beyond the currency issue.
While charging that the yuan is undervalued “to promote a more export economy,” Bernanke said that
moving the exchange rate alone would not have a major short-term effect but could have some impact
over time.

Sen. Lindsey Graham, R-S.C., who is sponsoring get-tough legislation on the currency issue,
told a recent meeting of textile executives that the currency issue has become a “defining moment”
in U.S.-Chinese relations and “we are going to press hard to get the administration to act.”
Graham’s bill would for the first time permit U.S. manufacturers to pursue anti-dumping cases based
on currency manipulation. Although there is considerable support in Congress to go the legislative
route, the pending bills are not very likely to be enacted into law in view of the administration’s
reluctance to go that route. The legislation does, however, serve to put pressure on both the
Chinese and U.S. governments to try to resolve the issue.

The next developments are likely to take place around the next U.S.-China Strategic Economic
Dialogue in Beijing and a meeting of the G-20 largest developed nations in Toronto in June.

Working With New Allies


As the U.S. textile and apparel industry has seen its employment fall from more than 1
million to 421,000 over the past decade, the once-powerful fiber/textile/apparel coalition has lost
some of its clout with Congress and various administrations. But that is in the process of being
turned around. Industry representatives in Washington are joining a wide array of coalitions and
business groups that share some common goals, particularly in the area of international trade, and,
as a result, their influence is increasing.

This past year, the National Council of Textile Organizations says it has worked with the
American Iron and Steel Institute, Fair Currency Coalition, Unite Here, AFL-CIO, National
Association of Manufacturers, and Citizens Trade Campaign as well as the traditional allied
organizations – the National Cotton Council, American Manufacturing Trade Action Coalition,
American Fiber Manufacturers Association and National Textile Association. Much of the work with
these organizations involved international trade issues, but the new alliances were helpful in
connection with the cap-and-trade environmental legislation and other issues in which the groups
have a common interest.

On top of this, textile lobbyists have been working with various congressional caucuses to
make direct appeals to members of Congress beyond those that have been reached traditionally
through the House Textile Caucus and an ad hoc Senate textile caucus. Contacts have been made with
the Blue Dog Coalition, which has more than 50 House members. This coalition was formed 15 years
ago by Southern Democrats, but since then, it has been expanded to include members of Congress from
25 states coast-to-coast. It has worked primarily on fiscal responsibility issues, but it now has
expanded its scope to focus on job creation, and that has meant becoming involved in international
trade issues. Textile lobbyists also are plugged into the House Trade Working Group, with 
more than 100 members who are sponsoring legislation calling for a major overhaul of U.S. trade
policy. Members of this group also have mounted an effort to pressure the Obama administration to
address the China currency issue.

All of this adds up to a much stronger voice for dealing with textile issues in Washington.

Some Legislation Expected This Year


Although Congress generally is reluctant to deal with international trade issues in an
election year, this year may be a different story because of the emphasis on the need to address
the nation’s economic woes and find ways to create jobs. Some bills are what have often been
described as “press release bills” that show members of Congress are working on issues of interest
to their constituents but that have little chance of enactment. Others, such as the currency
manipulation measures, are designed to put pressure on the Obama administration to act. There is a
pretty good likelihood Congress will enact legislation providing for more direct assistance and
trade liberalization with Haiti because of the urgency of the situation and the strong desire of
Congress and the administration to help that beleaguered nation.

Textile and apparel trade will be a major element in whatever Congress and the administration
come up with. Congress is likely soon to extend the duty suspensions on imports that do not compete
with U.S.-made products but are important components in a number of products, including textiles
and apparel. In connection with the reauthorization of Customs and Border Protection, there appears
to be an opportunity to incorporate some provisions, sought by U.S. textile manufacturers, that
would provide Customs with additional authority and resources to combat illegal imports.

May/June 2010
]]> https://www.textileworld.com/textile-world/washington-outlook-archive/2010/05/congress-considers-amending-consumer-product-safety-law/ Wed, 12 May 2010 00:15:00 +0000 http://ec2-54-210-48-17.compute-1.amazonaws.com/uncategorized/2010/05/congress-considers-amending-consumer-product-safety-law/

As Congress considers amending the consumer product safety law, apparel manufacturers are seeking
more flexibility in testing and reporting requirements and for federal preemption of a growing
number of state regulations.

The Consumer Products Safety Improvement Act (CPSIA) of 2008 gave the Consumer Product Safety
Commission (CPSC) broad new authority to regulate products used by children 12 years of age and
younger, and both industry and regulators believe it may have gone too far. As a result, the House
Subcommittee on Commerce, Trade and Consumer Protection is considering the Consumer Product Safety
Enhancement Act, which addresses what many in industry feel are “unintended consequences” of the
previous act that have caused considerable disruption and unnecessary costs.

Testifying at a subcommittee hearing on behalf of the American Apparel & Footwear
Association (AAFA), Steve Levy, director of operations of Star Ride Kids, a New York City-based
wholesaler of children’s apparel, called on Congress for relief from some of the testing and
certification requirements of the CPSIA by giving CPSC more flexibility in writing regulations.

Levy cited as an example of regulatory overkill in CPSIA a requirement for testing and
certifying the lead content of textile components in apparel when it is well-known that textiles do
not contain lead.

Levy said AAFA supports efforts to give CPSC authority to grant testing and certification
relief for small businesses, but it believes such relief should be available to all businesses
regardless of their size. Warning that “the system we are about to see will treat all components
and materials equally regardless of risk,” Levy said consumer safety would be better-served if
testing focuses on those products where there is reason to believe there is a risk of lead content.

Levy also urged Congress to provide relief from a rash of state regulations that complicate
doing business. He said more work needs to be done to ensure that CPSIA preempts state and local
product safety rules so that “we can achieve a single, harmonized national product safety
standard.”

May 11, 2010

Since the president announced the export-expanding goal during his State of the Union
address, administration trade officials have been making an all-out effort to sell the benefits of
exports. Under a National Export Initiative announced by the president, the Office of the U.S.
Trade Representative, the Small Business Administration, the Export-Import Bank and other federal
agencies have been working on programs to attack overseas trade barriers and facilitate more
two-way trade in other ways. A centerpiece of this effort is Congressional approval of the Panama,
Colombia and South Korea free trade agreements (FTAs), negotiated by the Bush administration, that
have been bogged down in Congress. U.S. textile manufacturers are not particularly concerned about
Panama, as little trade is involved, but they strongly support the Colombia pact, as it has a rule
of origin for apparel imports that presents opportunities for exports of yarn and fabric. On the
other hand, they strongly oppose the Korean agreement because South Korea has a large textile
industry of its own, and they see few opportunities for U.S. exports. They also feel the agreement
could result in a significant increase in imports that under the agreement could enter the United
States duty-free.

Other Actions

The Obama administration is taking preliminary steps to negotiate a Trans-Pacific Partnership
(TPP) that it says will broaden sourcing opportunities for U.S. retailers and increase market
access for U.S. exports. The TPP would include Australia, Brunei, Chile, New Zealand, Peru,
Singapore and Vietnam. U.S. textile manufacturers object to Vietnam’s inclusion, saying that
because of its non-market economy, it will be “another China.”

In a move that could benefit U.S. textile manufacturers, the administration is pursuing ways
to help make financing more readily available to companies interested in exporting. In a recent
meeting with textile executives, Kim Glas, deputy assistant secretary of commerce for textiles and
apparel, said her office is seeking ways to gain access to additional loans and grants to help
bolster exports. This is particularly important where the United States has FTAs with countries
that have financing problems.

Import Issues

While U.S. textile manufacturers welcome these initiatives, they are more concerned about the
high level of imports, which they say can never be offset by increasing exports. In the five-year
period preceding the recession, textile and apparel exports averaged around $18 billion, while
imports rose from more than $83 billion in 2004 to $93 billion in 2008. During that period, textile
and apparel employment fell from 698,000 to 406,000.

Textile industry lobbyists continue to focus on the need for the Obama administration and
Congress to address what they see as currency manipulation by China and other countries, which they
view as an illegal subsidy for their exports. In the pre-recession five years, China’s textile and
apparel exports to the United States rose from $14.5 billion in 2004 to $32.6 billion in 2008. In
addition to the need to address the currency issue, the National Council of Textile Organizations
says other subsidies must be eliminated, and the government needs to help find ways to facilitate
increased access to credit and other financing for exports.

Labor Reform Legislation Sidelined By Congress

One of organized labor’s top priorities, the Employee Free Choice Act (EFCA), has been
sidelined and is unlikely to resurface any time soon in its original form, if at all. With the
election of President Obama and control of both the House of Representatives and the Senate in the
hands of Democrats, organized labor was bullish on the chances for its long-sought legislation that
would bring about major changes in the way union-organizing elections are conducted. The
centerpiece of EFCA is the so-called “card check” that would authorize the National Labor Relations
Board to recognize a union if more than 50 percent of workers signed cards voting for a union. The
legislation also shortens the time for organizing efforts, imposes $20,000 fines on employers found
guilty of violating worker rights during an organizing campaign and provides for federal
arbitration if companies and unions are not able to agree on certification.

In 2007, the House passed a form of free choice legislation only to have it blocked by a
Republican-led filibuster. Following last year’s election, supporters of the legislation felt they
might have the votes to get the legislation passed in the current session, but nothing happened, as
the Obama administration had higher priorities. Hopes for passage of the legislation were further
dimmed by the Democrats’ loss of their 60-member margin to override filibusters, but in the case of
this legislation, support from conservative Democrats is not a sure thing. Business opponents of
the legislation say it would deny workers’ rights to privacy and violate the democratic process of
a secret ballot. On the other hand, the bill’s supporters say it would prevent intimidation of
workers during an organizing effort and stop efforts to thwart elections with delaying tactics.

There were reports late last summer that supporters of the legislation were willing to give
up the card check in order to get other elements of the bill, including the establishment of
timetables, arbitration and stiff penalties for violations of worker rights. That did not exactly
fly with labor leaders, and nothing happened. The fact that President Obama did not even mention
EFCA in his State of the Union address was a matter of additional concern, but Eddie Vale, a
spokesman for the AFL-CIO, says the act is still one of labor’s top priorities, and “we still think
we can get it done.”

March/April 2010
]]> https://www.textileworld.com/textile-world/washington-outlook-archive/2010/03/obama-outlines-international-trade-agenda/ Wed, 17 Mar 2010 00:30:00 +0000 http://ec2-54-210-48-17.compute-1.amazonaws.com/uncategorized/2010/03/obama-outlines-international-trade-agenda/

After weeks of talking in generalities, President Barack Obama has unveiled his strategy for
attempting to double exports over the next five years and create 2 million jobs.

The far-reaching program calls for financial assistance to companies wishing to export,
knocking down overseas barriers to trade and ordering a number of federal agencies with direct or
indirect involvement in trade to focus their efforts on how they can help achieve the president’s
goals. Obama’s proposals say little about problems with imports faced by textile and other
industries, except to say overseas countries must “play by the rules” of international trade, and
that countries that have a large trade surplus with the United States, such as China, should be
encouraged to place less emphasis on exporting and more on domestic consumption.

Obama calls his National Export Initiative “an ambitious effort to marshal the full resources
of the United States government behind American businesses that sell their goods and services
abroad.” He issued an executive order instructing the federal government to use “every available
resource in support of the mission,” and he created an Export Promotion Cabinet made up of the
Secretaries of State, Treasury, Agriculture, Commerce and Labor along with the U.S. Trade
Representative (USTR), the Small Business Administration, the Export Import Bank and other senior
officials. He also reactivated the President’s Export Council, which has been the principal
national advisory committee on international trade.

Calling for export promotion initiatives throughout his administration, Obama said, for
example, that Secretary of Commerce Gary Locke is issuing guidance to all senior government
officials who have foreign counterparts on how they can best promote exports, and Secretary of
State Hillary Clinton is developing a “commercial diplomacy strategy,” directing every U.S. embassy
to create a senior visitors business liaison who “will manage our export advocacy efforts overseas
and when ambassadors return home they will be expected to travel the country to discuss export
opportunities in their countries of assignment.” He said the Department of Commerce will sponsor
more than 40 trade fairs this year.

Pointing out that many businesses do not have the resources to identify new markets or set up
shop, Obama said he is planning to increase funding to set up “one-stop shops”  across the
country and in 250 embassies and consulates abroad to help businesses gain a foothold in the most
promising markets for exports. He said more funds will be available from the Export-Import Bank to
make loans to small and medium-size companies to help them enter new exports markets.

Obama said USTR Ron Kirk has been doing an “extraordinary job” and that he will continue
working to knock down trade barriers that he said “unfairly keep American companies from markets we
belong in.”  On the day after the president announced his program, Kirk met with leaders of
the U.S. apparel and footwear industries in Washington, and emphasized the importance of
eliminating trade barriers and gaining greater overseas market access. He also discussed the
administration’s efforts to combat counterfeiting and piracy of U.S. designs. He said that
protection of intellectual property rights is “critical to our future product development.”

Both Kirk and the president called for congressional approval of free trade agreements with
Panama, Colombia and South Korea, for negotiation of a Trans-Pacific Partnership and for renewed
efforts to bring about a successful conclusion to the Doha Round of trade negotiations, all of
which they believe are key elements in the program to expand exports.

Looking at the overall global trade picture, Obama said: “I know the issue of imports and
exports, the issue of trade and globalization, have long involved passions of a lot of people in
this country. I know there are differences of opinion between Democrats and Republicans,
differences between business and labor about the right approach. But I also know we are at a moment
where it is absolutely necessary for us to get beyond those debates.”

March 16, 2010

For many U.S. manufacturers, one of the most immediate priorities is the extension of
duty-free treatment to a wide range of imported components  that are not produced in this
country. Textile manufacturers have a laundry list of such components that includes such things as
acrylic and rayon yarns, and animal hair and other noncompetitive products. Congress failed to act
on the miscellaneous tariff bill during last year’s session, and, as a result, the existing duty
suspensions expired December 31. In the waning hours of last year’s session of Congress, the bill
was blocked by Sen. Debbie Stabenow, D-Mich., who said the basic purpose of the tariff concession
legislation was being subverted by the inclusion of finished products that are made in this
country. While U.S. textile manufacturers agree in principle with what she was doing, they are
concerned that her action raises the costs of imported components, and that will make their
products less competitive until duties are once again suspended. In view of the overall support for
the tariff concessions, Congress could act on the bill fairly soon.

Trade Preference Agreements

Congress and the Obama administration are expected to look at ways to improve and revise the
many trade preference programs (TPAs) that the United States has with a number of countries. The
House Trade Subcommittee is soliciting comments on its plans to assess the operation, impact and
future course of TPAs. The United States currently has regional TPAs with countries in Central
America, the Caribbean, Africa and Asia; and also with Canada and Mexico. In addition, it has a
General System of Preferences (GSP) that covers 131 countries.

The National Retail Federation (NRF) has proposed a 10-year extension of the GSP special
duty treatment and has recommended for the first time that textiles, apparel and footwear be
included, a move that is opposed by U.S. textile manufacturers. NRF and other importers of textiles
and apparel believe extending or making permanent the GSP authorization would make long-term
planning easier.

A majority of House Democrats, 129, and four Republicans have signed on to legislation
calling for a major review and sweeping changes in both existing and future TPAs. A similar bill is
pending in the Senate. Both bills place emphasis on economic results, enforcement and compliance;
and set out additional criteria for such things as overseas human and labor rights, environmental
considerations, national security and product safety. The legislation would give Congress much more
involvement and oversight in connection with trade agreements by replacing the president’s current
Trade Promotion Authority, known as “fast track,” with a requirement for the administration to
certify to Congress, in advance of any agreement, that a proposed pact meets the mandatory
negotiating objectives in the bill. And it would require periodic performance reports.

The outlook for trade agreements with Colombia and South Korea, negotiated by the Bush
administration and awaiting congressional ratification, remains in doubt. President Barack Obama
has made strong appeals for both to be ratified. Some efforts to resolve problems with the Colombia
pact have been made recently, but they may not have gone far enough yet to satisfy Congress.
Textile manufacturers support the Colombian pact because it has a strict rule of origin and offers
export opportunities for yarns and fabric. Opposition to the South Korean agreement is much
stronger. U.S. textile manufacturers flatly oppose it, as do U.S. automobile and agriculture
interests, which are concerned about lack of market access.

Customs Reform

Chairman Max Baucus, D-Mont., and Ranking Republican Charles Grassley, R-Iowa, of the Senate
Finance Committee have introduced customs reform legislation, which they say is designed to promote
legitimate trade but crack down on illegal shipments into the United States. They contend that U.S.
Customs and Border Protection in recent years has concentrated most of its resources on the
agency’s national security mission at the expense of trade. Their bill calls on Customs to
prioritize customs enforcement and at the same time devote more resources to facilitating
legitimate trade. It provides for creation of two high-level positions whose responsibilities will
be to upgrade enforcement and trade facilitation. The National Council of Textile Organizations,
which for years has been pressing for more resources to be devoted to cracking down on illegal
trade, supports the bill, pointing out that the textile sector attracts more fraud than any other
industrial product sector. NRF, whose members are the largest importers of textiles and apparel,
also supports the legislation, saying it believes the bill “strikes a balance” between the agency’s
trade and homeland security duties.

China Trade Issues

Although the U.S. trade deficit with China remains a major issue, not many people in
Washington or Beijing see much happening here. Leaders of both countries are strongly committed to
avoiding what could be construed as protectionist measures. Members of Congress and lobbyists for
textiles and other import-impacted industries repeatedly point to what they see as China’s currency
manipulation and other illegal subsidies, and they have introduced legislation to address those
issues.

The Obama administration for the most part is opposed to going the legislative route. The
U.S. government has made some use of its trade remedy laws by imposing tariffs on Chinese tires and
steel pipes, and other cases are pending. Lobbyists for textile manufacturers believe their best
course for relief most likely is to use anti-dumping and countervailing duty laws, and they are
gathering data and exploring possibilities in that area of relief.

The Obama administration has taken the position that the best course for dealing with Chinese
trade issues is through diplomatic engagements rather than legislation or other stronger tactics.
The administration believes China has been a strong partner in efforts to overcome the worldwide
economic crisis, and it is not about to pick a fight.

Global Trade Agreements

The Obama administration has announced plans to move forward with a Trans-Pacific Strategic
Economic Partnership Agreement with Australia, Brunei, Chile, New Zealand, Peru, Singapore and
Vietnam. Though discussions are just beginning and any agreement has a long way to go, U.S. textile
manufacturers are up in arms about including Vietnam, which they view as “another China.” They say
Vietnam has a nonmarket economy that manipulates its currency, relies heavily on exports for growth
and has a rising trade deficit with the United States. While admitting Vietnam could be a problem,
U.S. Trade Representative Ron Kirk says he hopes Vietnam could be brought into a “high standard”
agreement.

On another front, leaders of the World Trade Organization are making what may prove to be a
last-gasp effort to revive the Doha Round of trade liberalization negotiations in the coming year.
The U.S. government remains committed to it, but the developing and developed countries remain far
apart, and the outlook for a successful conclusion is anything but bright.

Consumer Product Regulation

Congress seems committed to giving a rejuvenated Consumer Product Safety Commission (CPSC)
additional funds and staffers to crack down on unsafe products, particularly those intended for use
by children. It has authorized $118.2 million for the coming fiscal year – an increase from $105.4
million authorized in 2009 – and has promised annual increases for the next five years. Most of the
CPSC’s additional resources will be directed at toys and other products used by children, but it is
possible the commission later this year could act on a pending national upholstered furniture
flammability standard. In addition, the commission could continue the process for writing a
flammability standard for bedding that has been under consideration for some time.



January/February 2010
]]> https://www.textileworld.com/textile-world/washington-outlook-archive/2009/11/concern-but-no-crackdown-on-chinese-currency-3/ Sat, 14 Nov 2009 08:30:00 +0000 http://ec2-54-210-48-17.compute-1.amazonaws.com/uncategorized/2009/11/concern-but-no-crackdown-on-chinese-currency-3/
E
ven though the US China trade deficit is on a course to exceed $200 billion for the fifth
consecutive year, the Obama administration seems to be avoiding any get-tough measures that might
provoke the Chinese and instead is pursuing a diplomatic solution to the problem.

In its latest semi-annual report to Congress on world currency practices, the Treasury
Department expressed its “serious concern” about the value of China’s currency but failed to name
China a currency manipulator, a step that could lead to US trade sanctions. The National
Association of Manufacturers said the failure to cite China was a “missed opportunity to move ahead
on the Chinese currency issue.”

As the report was released, the Fair Currency Coalition, an alliance of manufacturing,
agriculture and labor groups, stepped up its appeals for Congress to pass the Currency Reform for
Free Trade Act, which provides for use of US anti-dumping and countervailing duty laws when it is
determined that a country is manipulating its currency in order to gain an advantage in
international trade. Placing little faith in administration efforts to get a diplomatic solution to
the problem, the coalition said, “Negotiating without leverage is wistful thinking.” It added that
“only by treating Chinese currency as the export subsidy that it is can our negotiators gain the
leverage they need to end this problem by diplomatic means.”

While the administration clearly sees an undervalued Chinese currency as a problem that
contributes to the continuing trade deficit, perhaps more importantly, it also sees China as a
major player in the broader picture of addressing global economic woes. While the Treasury report
addressed the currency issue, it also says China needs to become less dependent on exports and
encourage more domestic consumption. That will require policy changes, and in that regard, the
United States can only make suggestions, because China will do what’s best for its citizens,
without much regard for the wishes of US manufacturers and workers.

Former Congressman and House Armed Services Committee Chairman Duncan Hunter (left) accepts
the Award of Outstanding Military Merit from Benjie Reynolds, Milliken & Company, chairman,
National Textile Association Government Textiles Committee and Textile Industry Coalition on
Government Procurement. The award, presented during the coalition’s military textile conference
held in conjunction with IFAI Expo 2009, recognizes Hunter’s support of a strong Berry
Amendment.

More Government Business Sought

In the face of the economic downturn, more and more textile companies are seeking ways to do
business with the military and other government agencies. At a recent conference on military
textiles sponsored by the Textile Industry Coalition on Government Procurement – comprised of the
National Textile Association, the American Manufacturing Trade Action Coalition, the National
Council of Textile Organizations and the US Industrial Fabrics Institute – attendance exceeded
expectations as companies showed an increasing interest in supplying the military.

In addition, textile industry trade associations are pressing the Department of Homeland
Security (DHS) to open doors for more purchases of US-made textiles and apparel. Together, the
Department of Defense (DoD) and DHS could purchase nearly 100 textile and apparel products.

The DoD has projected textile and apparel procurement totaling $2.7 billion in the current
fiscal year (FY), an increase from $2.4 billion in FY 2008. Items for the military include a vast
array of textile and apparel products, including dress and combat uniforms, extreme-cold-weather
gear, body armor, protective outerwear, tents, tarpaulins and medical supplies.

In view of the continuing demands, US textile manufacturers are working with military
procurement officials to clarify and simplify procurement processes so that domestic manufacturers
can meet military needs and in the process bolster the US textile and apparel industries. At the
textile coalition conference, military procurement officials outlined projections for funding and
discussed new items under development. They expect FY 2009’s funding of $2.7 billion to be reduced
somewhat next year, although demand will remain high.

Participants in the coalition conference emphasized that improving the contracting process by
awarding contracts more quickly and smoothing out ordering practices and delivery schedules will
help US manufacturers respond quickly and more effectively to their often changing demands.

Meanwhile, textile manufacturers are pressing for a broad interpretation of the Buy American
provisions in the American Recovery and Reinvestment Act. Sponsors of that legislation emphasize
that the purpose of the act’s Buy American provisions was to create jobs, but they feel the initial
regulations published by DHS fall far short of that goal and open the door to too many imports.

The problem centers around DHS classification of items “directly related to national
security.” Textile manufacturers say the current classifications are confusing and will make it
difficult for manufacturers and government contracting officials to implement the law.

In addition, US manufacturers are particularly concerned about the fact that Mexico, Canada
and Chile, which have FTAs with the United States, are not subject to the Buy American requirement
because those nations were not properly notified of the legislation. Textile industry and organized
labor organizations are pressing the Obama administration to act promptly to resolve the issue as
quickly as possible, as hundreds of millions of dollars of sales could be involved.

While military demands will fluctuate depending on what’s happening in Afghanistan, Iraq and
other areas of military involvement, homeland security requirements are likely to increase. How
much depends on the willingness of the DHS agencies involved to issue regulations that will require
domestic procurement.

In many cases, DHS and DoD agencies have resisted Buy American provisions because they likely
result in higher costs than overseas procurement, but the Obama administration and Congress seem
committed to maximizing the job-creation potential of government procurement of textiles and
apparel.

Some Legislation Likely This Year

While President Barack Obama and Congress both have for the most part avoided getting
involved in major international trade issues, some legislation of interest to textile manufacturers
still may be dealt with during the remainder of this year.

There is a miscellaneous tariff bill that grants temporary duty suspensions to products that
no longer are produced in the United States. The current exemptions, which must be renewed by the
end of this year, include some textile products and textile machinery, and additional products may
be added to the list.

Also expiring at year’s end is the Andean Trade Preference Act, which extends duty-free
benefits to Colombia, Ecuador, Peru and Bolivia. Congress likely will extend it.

A separate free trade agreement (FTA) with Colombia that was negotiated by the Bush
administration has been held up by Congress in view of some concerns over labor and human rights
abuses. President Obama strongly supports the Colombia agreement and has urged Congress to approve
it. If recent steps taken by Colombia to address congressional concerns satisfy organized labor,
the Democratic leadership in Congress is likely to give it a go-ahead.

A FTA with South Korea also is awaiting congressional action, but it is much more
controversial, and nothing is likely to happen very soon, if at all.

US textile manufacturers are urging Congress to strengthen textile and apparel Customs
enforcement when it acts on legislation re-authorizing US Customs and Border Protection. Claiming
that the textile sector attracts more fraudulent activity than any other industrial product, Cass
Johnson, president of the National Council of Textile Organizations, is pressing for more Customs
resources to be dedicated to policing textile and apparel trade.

November/December 2009 ]]> https://www.textileworld.com/textile-world/washington-outlook-archive/2009/09/kimberly-glas-named-to-key-textile-trade-post/ Tue, 01 Sep 2009 23:00:00 +0000 http://ec2-54-210-48-17.compute-1.amazonaws.com/uncategorized/2009/09/kimberly-glas-named-to-key-textile-trade-post/

Kimberly Glas, former legislative director for Rep. Mike Michaud, D-Maine, has been named deputy
assistant secretary of commerce for textiles and apparel, a post that plays a major role in
developing and carrying out the administration’s textile trade policies. She will head the Office
of Textiles and Apparel (OTEXA) and serve as chairman of the Committee for the Implementation of
Textile Agreements (CITA), an interagency group that administers trade agreements and takes action
in situations in which there are illegal textile or apparel imports. OTEXA supports CITA by
providing staff and collecting data that are the basis for CITA’s administration of textile trade
programs.

The National Council of Textile Organizations (NCTO), which supported Glas’ appointment, says
she helped organize the House Trading Group, which was co-founded by Michaud. That bipartisan group
of House members supports fair trade policies, and its members have been outspoken on issues
involving trade with China and loss of manufacturing jobs. NCTO says Michaud and Glas have been
helpful in connection with a number of textile trade issues, including enactment of the Kissell Buy
American amendment and measures to monitor and control Chinese textile imports.

September 1, 2009