Trade Adjustment Assistance Programs Under Title II of the Trade Act of 1974

I welcome the representatives from the public who have come to testify today and tomorrow, and I also want to welcome my colleagues from the Congress who have come to talk to us about the adjustment assistance. The subcommittee will receive testimony on several bills introduced on several provisions of the worker assistance program; namely, to amend the present 1-year limit on retroactive applications for petitions, to extend benefit allowances an additional 26 weeks, and to amend the present Federal and State funding of the program.

The subcommittee is particularly interested in hearing the views of labor, business, and other interested parties to these Government assistance programs.

Through your help, we can consider possible changes in this law and the regulations to improve the effectiveness of these programs in achieving an orderly adjustment to import competition.

Administration witnesses will be invited to testify at a later date. I hope that it will not be too much later.

Because of the limited time available and to maximize the period for questions and discussion, we ask each witness to summarize his statement and restrict his presentation to not more than 5 minutes. The testimony of all witnesses will be printed in full in the hearing record, which will remain open for written statements through the close of business on Monday, April 4.

Without objection, the press release announcing this hearing will be included in the printed hearing record.

No objection being heard, it is so ordered.

(1)

[The press release follows:]

[Press release of Monday, Mar. 14, 1977]

CHAIRMAN CHARLES A. VANIK (D., OHIO), SUBCOMMITTEE ON TRADE, COMMITTEE ON WAYS AND MEANS, U.S. HOUSE OF REPRESENTATIVES, ANNOUNCES DETAILS OF PUBLIC HEARINGS BEGINNING THURSDAY, MARCH 31, 1977, ON THE TRADE ADJUSTMENT ASSISTANCE PROGRAMS UNDER TITLE II OF THE TRADE ACT OF

1974

The Honorable Charles A. Vanik, Chairman of the Subcommittee on Trade of the Committee on Ways and Means, U.S. House of Representatives, today announced details of public hearings previously announced on March 4, 1977, that the Subcommittee on Trade will hold beginning Thursday, March 31, 1977 and Friday, April 1. The hearings will be held in the Main Committee Hearing Room of the Committee on Ways and Means, Longworth House Office Building beginning at 10 a.m.

The purpose of these hearings is to review the operation and effectiveness of Trade Adjustment Assistance programs for workers, firms, and communities provided under Title II of the Trade Act of 1974. The first day of the hearing will be devoted to testimony from public witnesses on bills presently pending before the Subcommittee on Trade amending the one-year eligibility limitation under section 223(b) and extending the benefit periods under section 233 of the Trade Act relating to adjustment assistance for workers. These bills include H.R. 1593, H.R. 2484, H.R. 2523, H.R. 3666, H.R. 4460 and H.R. 4581.

The remaining time will be devoted to testimony from public witnesses on other aspects of the worker, firm, and community trade adjustment assistance programs, including the administrative procedures and eligibility requirements for obtaining benefits, the relationship between trade and other non traderelated economic adjustment programs, and overall program performance in meeting the objectives of timely and effective assistance. Testimony from Administration witnesses on these matters will be scheduled at a later date.

Witnesses will be allocated time for summarizing their statements, based on the total time available to the Subcommittee. The full statement will be included in the record. Also, in lieu of a personal appearance, any interested person or organization may file a written statement for inclusion in the printed record.

Requests to be heard may be received by the Committee by the close of business, March 28, 1977. The request should be addressed to John M. Martin, Jr., Chief Counsel, Committee on Ways and Means, U.S. House of Representatives, Room 1102 Longworth House Office Building, Washington, D.C. 20515-telephone (202) 225-3625. Notification to those scheduled to appear and testify will be made by telephone as soon as possible after the filing deadline.

In this instance, it is requested that persons scheduled to appear and testify submit 30 copies of their prepared statements to the Committee office, Room 1102 Longworth House Office Building, by the close of business March 30, 1977. Persons submitting a written statement in lieu of a personal appearance should submit at least three (3) copies of their statement by the close of business April 4, 1977. If those filing statements for the record of the printed hearing wish to have their statements distributed to the press and the interested public, they may submit 30 additional copies for this purpose if provided to the Committee during the course of the public hearing.

Each statement to be presented to the Subcommittee or any written statement submitted for the record must contain the following information:

1. The name, full address and capacity in which the witness will appear; 2. A list of any clients (or the firm or association he represents) at whose behest or in whose employ the witness appears;

3. The bill or bills on which the witness will be testifying and whether the testimony will be in support or opposition to it; and

4. A topical outline or summary of the comments and recommendations in the full statement.

Mr. GIBBONS. In addition, the members have an extremely thorough set of background briefing papers prepared by our staff.

I would like to move that this be made a subcommittee print on trade adjustment assistance. I think it is an excellent background presentation.

This has been moved, and those in favor will say, "Aye." [Chorus of ayes.]

Opposed, "No." [No response.]

The print will be printed.

On other matters, we have received additional documents on last week's International Trade Commission authorization hearings. I ask permission that these documents of the ITC and its reorganization and our own staff study of the ITC be entered in that hearing record.

Is there objection to this request? [No response.]
Without any objection, it will be so ordered.

I would like to say, in addition to what I have just said in my opening statement, that I think that trade adjustment assistance ought to work. There is no reason for asking the firm or the worker or the community to have to bear the burden of public policy that has been set by the Congress, and within my own ability, I intend to see that that does not happen.

I realize that we have had this program in existence for some time. It is certainly better than the program that was passed in the Trade Expansion Act of 1962, but it is still not working well enough.

It is the objective of this member of this subcommittee to make sure it works effectively and properly.

Without any further ado, let us hear first of all from our colleague, Mr. Philip Sharp, who is a Representative in Congress from Indiana.

Mr. Sharp, we welcome you to this table. We acknowledge that you have been a leader in bringing the shortcomings of this program to our attention. You may proceed as you wish, Mr. Sharp. STATEMENT OF HON. PHILIP R. SHARP, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF INDIANA

Mr. SHARP. I would appreciate placing my testimony in the record and summarizing my remarks.

Mr. GIBBONS. That will be done.

Mr. SHARP. I thank the committee for again raising this issue. I know last fall in the chaotic closing days of the session you were willing to take time to hear my concerns and the concerns of many other individuals and show your concern for this important question that had arisen.

Very briefly, Mr. Chairman, as you have already indicated, the purpose of TRA was to try to make sure that some kind of assistance was given to those individuals who had to bear the brunt of a major change in the trade policy of this country, a trade policy, from which the whole was to gain, but in which we knew that certain individuals would be harmed, at least on a temporary basis.

Unfortunately, because of the requirement that you can only petition to become eligible, within a year after you have been laid off as an individual, or as a group, a number of individuals simply

have not received their benefits. They either were unaware or unable to find out about the program in its new form, enacted in 1974, or they were unable to establish their eligibility within that one year because they had to show that it was the trade policy, it was imports which caused them to lose their jobs.

This, as you can imagine, has led to growing concern about trade policy, and frankly, among a number of my constituents, growing bitterness about the failure of the Federal Government to be sensitive to individual needs and to carry out the provisions of the program through which they thought they were to receive benefits. Mr. Chairman, I would simply urge that the committee act on this matter and act with speed.

The purpose, of course, was to have the benefits when they were most needed. I would stress that they are still needed. I still have constituents at the Warner Gear plant who are out of work, who were laid off because of import policy, who then, of course, suffered with the recession and the inability to find jobs elsewhere.

They still need those benefits for daily existence. Even though a few have been able to get back to work and would still become eligible under this bill, they, after all, lost savings or incurred debts and have paid a price for the change in trade policy.

So I would certainly urge that the subcommittee give careful consideration to this matter.

[The prepared statement and attachment follow:]

STATEMENT OF HON. PHILIP R. SHARP, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF INDIANA

Mr. Chairman, I am here to testify in favor of H.R. 4460 and H.R. 5363, identical bills to amend the worker adjustment assistance provisions of the Trade Act of 1974. Thirty-eight Members of Congress have joined me in sponsoring this legislation, and I believe this is an indication of the widespread concern about the inequity the bill is designed to correct. Your willingness to schedule this hearing early in the session, in light of the many other pressing matters before this subcommittee, shows that you share our concern. On behalf of the other sponsors and the thousands of affected workers, I appreciate the subcommittee's interest.

THE INEQUITY OF THE ONE-YEAR LIMIT

As you know, the Trade Act of 1974 provides for payment of a Trade Readjustment Allowance (TRA), as well as other forms of adjustment assistance, to workers laid off as a result of increased import competition. This helps ensure that "the social costs of adjustments to import competition should not fall disproportionately on a few, while the economic benefits of liberalized trade are enjoyed by everyone." To receive such assistance workers or their representatives are required to petition the Labor Department for certification of eligibility. In order to ensure that the assistance is provided promptly, while the workers need it most, Section 223 (b) of the Act limits benefits to those workers who were laid off within one year prior to the date of the petition.

This incentive for prompt filing, however well intentioned, has resulted in a major inequity in the provisions of TRA benefits. Many workers whose jobs were lost because of imports have been excluded from the trade adjustment assistance program beiause the petition to certify thir eligibility was filed too late. There are various reasons for these late filings, but the principal one to date has been the lack of widespread information about the new program and the deadline. Another one is the lack of timely trade data to justify a claim that layoffs in a given plant or industry were in fact caused by import competition.

The main point, however, is that thousands of workers who meet every other criterion for eligibility have been denied benefits because of this one year limit.

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Trade Adjustment Assistance Programs Under Title II of the Trade Act of 1974 ...