More relevant than others. On television and online, cspan is your unfillerred view of unfiltered view of government so you can make up your own mind. Brought to you as a Public Service by your cable or satellite provider. Now, the Senate FinanceCommittee Examines the u. S. Mexicocanada trade agreement. Former agriculture secretary tom vilsack, along with a panel of trade and industry representatives, testified on how the usmca could impact the average american as well as how it differs from the 1994 north American Free trade agreement. Meeting will come to order. We welcome our witnesses. Were here to have testimony from a range of industries to tell us about the importance of the United Statesmexicocanada agreement, and we soon are referring that to always as usmca. We look forward to hearing from our witnesses about the significance of the agreement to american businesses, both small and large, the workers, the farmers that we all represent. Thank you for being here. Mexico and canada are our countrys most important trading partners. According to the International Trade commission for the year 2017, more than onethird of americas merchandise exports went to mexico and canada. In that year mexico and canada imported more than half a trillion dollars of American Goods plus more than 91 billion of american services. For iowa our six and sixtenths billion of exports to canada supported 130,000 jobs. The foundation of our strong trading relationship with mexico and canada have been, thus far, nafta. The United States, mexico and canada negotiated that agreement between 1990 and 93. At the time, it was a new standard of trade agreements. It helped mexico reform into a market economy, it enabled american businesses, workers, farmerses and ranchers to sell our goods and services in mexico and canada without tariffs and without many nontariff barriers that for decades had burdened our ability to compete in those two countries. Of course, the u. S. Economy and the global trade have changed dramatically since 1993 and 25 years of experience with nafta have provided valuable lessons. The time for modernizing nafta has come, and thats what usmca is all about. It sets a new standard for our trade agreements. For example, once enacted, the agreement will make it will be the first u. S. Free trade agreement with robust chapters dedicated to digital trade, anticorruption, good regulatory practices and small and mediumsized enterprises. Usmca will set a new benchmark in many other areas as well such as free transfer of data across borders, strong rules on stateowned enterprises, north american content requirements for preferential treatment, food safety and biotechnology standards, customs and trade facilitation, intellectual Property Rights protection and enforcement, labor and environment. Usmca labor chapter squarely addresses workers rights in mexico, and it already has resulted in the overhaul of mexicos labor laws. The labor and Environmental Standards in the agreement are the most rigorous in any u. S. Trade deal. And unlike with nafta, theyre in the core of the agreement and are fully enforceable. Usmca also squarely addresses longstanding u. S. Concerns in the Canadian Market such as canadian policies on wheat grading, retail sale of wine, dairy supply management and the distribution of u. S. Television programming. These are stamm improvements substantial improvements from nafta. They represent benefits and new opportunities for iowans and were americans across the board. According to the International Trade commission, the agreement will increase real gdp by 68 billion and 176,000 new american jobs. Now, thats not to say that every usmca provision is perfect. Trade agreements always need to balance the preferences of different industries, region, elected leaders and stakeholders. Some of my democratic colleagues in the house of representatives have centered their attention on usmca outcomes that they view imperfect. Surely nobody could consider nafta to be better than usmca, and nobody let me emphasize nobody should dismiss the importance of a half trillion dollar market for u. S. Agriculture products. I came away from a meeting that i had with Speaker Pelosi that was very positive as i heard her words and express her attitude the towards usmca. People want to push and push, but i think we must be patient as she works through this, and i have confidence she wants to get to yes. I have supported besides, i have also supported the onto going work of the speakers members with ambassador lighthizer to clarify outstanding concerns and identify bipartisan solutions. I have an open mind to workable ideas and stand ready to consider possible improvements in the agreement. For example, i support strong enforcement of all of the chapters through a system that works reliably and has credibility with our trading partners. Im also pleased that important usmca provisions on Prescription Drugs will not require any changes to u. S. Law. And i would be open to proposals that would confirm that point. At the same time, every day that passes is another day that benefits usmca go unrealized. Trying to reopen the whole agreement could risk unraveling the deal altogether, which would benefit nobody. I, therefore, urge the house of representatives and ambassador lighthizer to focus on their specific concerns and to propose solutions in short order so that we can pass usmca. Doing so will provide muchneeded certainty to American Workers, businesses, farmers, ranchers families and will enhance the credibility of our ambitious global training. Senator wydenen. Thank you. Very much, mr. Chairman, and i want to make clear at the outset that i look forward very much to working closely we you on all of these issues. Colleagues, the finance Committee Meets this morning to discuss what needs to happen for nafta 2. 0 to deliver better results for American Workers, our farmers, our ranchers and particularly American Families from sea to shining sea. I do want to begin my remarks by giving a big oregon shoutout to one of our witnesses, ms. Paula barnett, not only because she is an oregonian, but as a entrepreneur, ms. Barnett is a perfect example of why the original nafta needs a bold upgrade. Ms. Barnett is an artisan from brownsville, oregon. Ive been in that area often for town halling meetings, and leadership countys population is about 1800 people. Brownsville. She founded a jewelry business that produces in oregon and sells online, primarily on etsy, to customers in the United States and around the world. She also sources some of what dose into her jewelry from goes into her jewelry from abroad. Getting that kind of business off the ground would have been a lot harder just a few short decades ago when nafta was created. According to etsy, the total economic output of its sellers based in oregon is more than 125 million, and that is just one of the many Online Platforms that businesses use to grow. Oregons many Success Stories also include rough ware based in bend, a producer of gear for very good dogs all over the United States and in other countries. Updating nafta means addressing the challenges facing these businesses that operate online. It also means confronting the other areas where older trade agreements continue to this day to fall short. Fighting to protect labor rights and the interests of working families, preventing a race to the bottom when it comes to the environment, making sure there is vigorous enforcement of our trade agreements so that other countries can cannot treat those deals as empty documents that give them time and opportunity to rip off american jobs. And i want to particularly emphasize this trade enforcement issue. My colleague, senator cantwell and i, come from the pacific northwest. One out of five jobs in the state of oregon revolves around International Trade. The trade jobs pay better than the nontrade jobs in many cases because there is a valueadded component. And in my home state, one of the first things anybody asks about when the trade topic is brought up is, hey, ron, what are you guys in washington, d. C. Doing to better enforce the trade laws that are on the books . They understand you need to upgrade these policies, but they want to make clear that the new day has to involve tough, enforceable trade laws that have real teeth in them. Of the old nafta. Its too easy on trade sheets. Its not good enough for American Workers, particularly on labor rights senator brown and i have proposed some additional tools to address specific challenges in mexico, and i hope there will be progress on that front. Additionally, one of the bigger challenges we confront is identified the hundreds of thousands of sham labor contracts in mexico that that s exploited workers and harmed workers here. Mexico must remain on track to get those contracts renegotiated on behalf of of the workers interest. During the overall the original nafta remains in place. Workers, farmers, ranchers and businesses should not have to fear that Economic Uncertainty will cost them their livelihoods. Its a problem with the president acts out and makes impulsive threats regarding our trade relationships. American farmers, American Workers have been hurt by some of these president ial impulses, and more will get hurt if the president continues to offer threats and chaos, and possibly this ends up causing the congress to accept a bad deal on nafta. Passing a trade deal that would allow this president to unilaterally change rules and in effect jerk around the entire industries would be a dangerous mistake that promotes uncertainty. When i talked to businesses, more than anything, they constantly, back to certainty and predictability. And you dont get trade done right with all of this uncertainty, and based on that ice concerns about of the administration wants nafta to point out to be intimate. Thats what well be talking about today i know my colleagues to deepen both sides of the aisle about trade and id like to close this comment will begin come ms. Barnett were so glad youre here. I think you are the face of much of what the trade challenges all about. We welcome you. Thank you, mr. Chairman. Thank you. Ms. Barnett, how can i do better than he did in introducing you . I guess silly thing i would add from my notes is that you singlehandedly run your business selling jewelry to buyers all across the world so youre definitely concerned about trade agreements and trade generally. So thank you for being here. Next i would like to welcome matt blunt, president of the American Automotive policy council. Governor blunt was a 50 for the governor of missouri, serving history as chief executive 20052009. Hes been president of the American Automotive policy council since 2011. Inability represents the common policy interests of americas largest automotive manufacturers, ford, General Motors, fiat, chrysler. So we welcome you, governor blunt. Then we had mr. James collins, chief executive, he leads the only major side dedicate agriculture just work began 35 years ago when he joined dupont 1984. He worked his way up the ladder. Mr. Collins became chief operating officer for the Agriculture Division of dow dupont before becoming ceo over recently standalone company, Corteva Agriscience. Congratulations on your new position. Then we welcome derek leathers, president and ceo warner enterprises, found in 1956. Warner moved his headquarters from Council Bluffs iowa to omaha which is still close across the river. Now youre still about i win i hope. I dont agree with the move, but person making that mistake. Warner is now one of americas largest transportation and Logistics Companies with a network of over 7800 trucks, an extensive expense in shipping and distributing goods to canada and mexico. Prior to joining warner enterprises, mr. Leathers is one of the first foreign members of mexicos trucking association, and was based out of mexico city for several years. Thank you. Now i have the pleasure of introducing i iowas former governor and former secretary of agriculture for u. S. Department of agriculture, tom vilsack is now president and chief executive officer of the u. S. Dairy export council. He was elected i was 40th governor in 98, served eight years there and eight years as secretary of agriculture. Now is is the leader of u. S. Dy export council. He represents trade interest of more than 100 dairy industry, their exporters and affiliated entity members, so thank you for coming, mr. Secretary. Finally, welcome Michael Wessel, president of the wessel group and staff chair of, to the Labor Advisory Council for trade negotiations and trade policy. As the staff chair mr. Wessel helps direct Committee Responsibility for advising and consulting secretary of labor and the u. S. Trade representative regarding policies on labor and trade negotiations. He worked as a congressional aide for over 20 years and also a commissioner on the u. S. China economic and security review commission. So thank you, mr. Wessel. Now we will start with ms. Barnett and we will go that same way across the table as i introduced you. Good morning. My name is Paula Barnett and im a jeweler living in brownsville oregon with my nineyearold daughter carla. Thank you, chairman grassley, Ranking Member wyden, and members of the committee for inviting me to speak to you today about my Creative Business. I am a self taught fine shooter i spent six youre studying art and architecture history. While i loved dearly the Career Options were extremely limited. After failing to find a job in my field i conducted Market Research and decide to become a jeweler. Ive always been a maker and once i decided on this path i dove headfirst into teaching myself how to make jewelry with simple tools and equipment. I launched my business in 2013 on an Online Market place for handmade goods and craft supplies. Within a couple of months id already earned enough to cover my initial investment in tools and supplies, a rare feat for a new entrepreneur. Today im a fulltime goldsmith. I make custom engagement and wedding bands using recycled fine metals and ethically sourced stills. Ive come a long way from making brass rings shaped like mountains to setting diamonds in solid gold. My work is 100 made by me, with my own hands in my home studio and oregon. Im also a single mother and my business allows me to be there for my daughter. I am home when she gets off the school bus, sick days are a nonissue and my flexible schedule allows me to raise my child as i see fit. I am very blessed in this regard. Carla also benefits from watching me exert myself creatively and succeed in business. Excuse me. Im proud of my success but my story is not unique. Globally, etsy host over 2. 2 million traded entrepreneurs like me, and fully 87 87 of those sellers are women. Nearly all of them are businesses of one working out of their homes. We are microbusinesses, yet we we have Significant Impact on our communities and the broader economy. In 2018 of the u. S. Etsy sums contributed 5. 30 7 billion to use, and created over 1. 52 million jobs. Our impact is especially big in Rural Communities like mine. For example, 27 of of etsy sellers live in Rural Communities, compared to just 17 of Business Owners nationwide. Individually, we may be small but together we are supporting our families and revitalizing communities across the nation. Perhaps at the present find it this is a small us by testifying before congress about a multilateral trade agreement, but but i am exported in my own right. About 20 of my sales are international. Like many etsy sellers i i mady goods available to International Buyers on the moment i opened my online shop. Today, 52 of all etsy sellers export the goods. Unfortunately, the u. S. Is the only one of etsy core market with majority of etsy sellers do not ship the goods to other countries. For example, 90 of canadian etsy sellers ship internationally. Trade agreements like the usmca has huge potential to the u. S. Microexporters like me grow our international businesses. In particular, de minimis customs thresholds, digital trade provisions and Educational Resources targeted to Small Businesses could all help increase in exports. Youre doing great, ms. Barnett. Thank you. First, my business depends on my package is being delivered quickly and with minimal hassle to buy overseas customers. Unfortunately, many of my customers must pay extra taxes and fees on the pieces i export, often unexpectedly get ive had many packages get stuck in customs, and to the dismay of my customers they must travel in person to pay the required fees before collecting the item. In some cases the cost can nearly the double the price of the item. This is a hindrance to sharing my work with the world. A few customers have even refused packages due to extra taxes and duties. In those cases i find myself having to refund the item including the shipping cost or risk entering a a negative revw which can make or break a business like mine. De minim