Today, 15 months later, almost 1,000 people remain unemployed as a result of the original layoff. The resulting economic impact upon the western Upper Peninsula has been devastating. In this kind of setting, Trade Adjustment Act benefits for workers have been invaluable in terms of meeting these individuals basic needs. In addition, the program has provided a measure of stability for family and community life in the western Upper Peninsula during an extremely difficult time. As I understand it, the program now runs for 52 consecutive weeks. A worker is eligible for an additional 26 weeks of benefits if he is enrolled in a certified program to provide new job training and skills. Mr. Chairman, I would like to indicate my support this morning for H.R. 1593 to extend the basic benefit program to 78 weeks. In my view, this extension will provide further assurance to the people of the White Pine area that their needs will be met until the economic situation at the mine can stabilize. In addition, I have identified various aspects of the TRA program which I believe need clarification, change, or careful review. These are important issues and need to be brought to the attention of the Subcommittee. For example, I believe the present method for certifying and payment of relocation benefits is inadequate and unfair. If a worker applies for relocation benefits before he moves he is eligible. If he moves and then applies for relocation assistance he is out of luck. In my view, the point at which certification is made should not be an issue. If a worker has taken the initiative to find new employment, and moves his family in order to begin his new job then he should receive relocation aid regardless of whether he requests it immediately before or after the move. During the months that I have been involved with the TRA program both my staff and I have observed a serious lack of adequate information regarding the program. Members of my staff have spent countless hours digging up information and answering constituent inquiries regarding basic questions about the program. I have found, to my amazement, that only one decent booklet exists describing the TRA program in a limited manner. Its impact is not great, however, because it is not distributed among workers certified as eligible for the program. In my view, the Department of Labor and the contracted state agency can do a better job of getting out the facts on the TRA program. I would certainly encourage the Subcommittee to exercise its oversight function with regard to this issue. It is also apparent to me that the Department of Labor has not always maintained close liaison with the contracting state agency in administering the program. For example, I found in the White Pine case that the state agency administering the TRA program was holding applications until they could process 500-600 at one time. This resulted in totally unnecessary delay in payment of benefits to workers and I insisted that applications be handled on a case by case basis. A similar situation has developed in recent weeks with regard to vocational counseling and job training. Workers have been denied the opportunity for job training now because the state agency involved has been unwilling to commit the resources to insure placement of workers in certified job training programs. Again, I have insisted that this be remedied and that workers receiving TRA be informed regarding the possibilities for new job training at the earliest date. In my view, this is an important cornerstone of the TRA program and the Department of Labor needs to be more vigilant in terms of monitoring the program and more careful in determining contractual arrangements with the state agency selected to administer the program. Mr. Chairman. I support extension to the TRA benefit program for workers. It has been absolutely essential to the effort to maintain economic stability in the western Upper Peninsula during a very unstable period in the copper industry. At the same time, I believe the suggestions I have made will improve the program and make it more responsive to the needs of the workers involved. I know the people of the western Upper Peninsula share my concern regarding these matters and I appreciate the Subcommittee's interest in the TRA program. If you have questions I would be pleased to try to answer them. I thank you again for the opportunity to testify before the Subcommittee this morning. STATEMENT OF THE AMALGAMATED CLOTHING AND TEXTILE WORKERS UNION, AFL-CIO, MURRAY FINLEY, PRESIDENT, JACOB SHEINKMAN, SECRETARYTREASURER, SUBMITTED BY ART GUNDERSHEIM, DIRECTOR OF INTERNATIONAL TRADE AFFAIRS The membership of the Amalgamated Clothing and Textile Workers Union totals approximately 510,000 workers who produce, among other things, men's and boys' clothing such as suits, sport coats, trousers, raincoats, overcoats, shirts, gloves and various textile products. On behalf of our workers, we appreciate this opportunity to endorse bills pending before the subcommittee which amend the one-year eligibility limitation under Section 223(b) and extend the benefit periods under Section 233 of the Trade Act of 1974 relating to adjustment assistance for workers. These bills include H.R. 1593, H.R. 2482, H.R. 2523, H.R. 3666, H.R. 4460 and H.R. 4581. We have never considered in the past-nor do we now feel-that adjustment assistance is a remedy for the injury inflicted on domestic industry and their workers as a result of imports. It is at best only a temporary palliative, not a cure. Nonetheless, we are in support of any improvements that can be made in the adjustment assistance programs to make them more flexible and of more help to workers who suffer the loss of their jobs as a result of the impact of burgeoning imports in their industry. We have hundreds of workers who have had adjustment assistance denied them due to the overly restrictive one-year limitation between separation of employment and date of petition for certification. Thus H.R. 2523 would be very helpful. IMPACT OF IMPORTS THREATENS SURVIVAL OF APPAREL INDUSTRY Our workers are not opposed to trade, but we are concerned over the everincreasing damage done to domestic industries and their workers which arise from imports benefiting from low-wage foreign production or unfair trade practices. The textile and apparel industries have shown extreme vulnerability to such imports with the result that there were 150,000 fewer jobs in such industries last year than there were 10 years earlier. In 1976, total textile and apparel imports recorded their second highest level on record, one-third higher than imports in the preceeding year. Some of the most serious inroads by imports have been experienced in the men's and boys' tailored clothing industry. Between 1968 and 1976 there was a loss of some 42,000 jobs in this industry, about one-third of the jobs which existed at the beginning of this period. Imports of men's and boys' tailored clothing items set new record levels in 1976. In the case of suits, imports rose from less than one-half a million in 1968 to 3.6 million in 1976. Domestic cuttings (production) of suits declined in this period from 25 million suits to 16 million suits. As a result, imports as a percent of domestic cuttings increased from about 2% in 1968 to over 22% in 1976. Similarly, in the case of men's and boys' sport coats, imports rose from 1.8 million in 1968 to 6.9 million in 1976, setting an all-time high last year. Imports as a percent of domestic cuttings rose from less than 10 percent in 1968 to 45 percent last year. For the information of the subcommittee, I am attaching a table which sets forth in detail the relentless gains made by imports of men's and boys' suits and sport coats. Against this background of reduced production and reduced jobs as a consequence of higher import penetration in import sensitive industries such as our own, it is but natural that we should support any liberalization of worker benefits and eligibility provisions in the adjustment assistance program such as is contemplated in the legislation being considered by this subcommittee. But we must emphasize this does not mean our workers endorse adjustment assistance as an import relief vehicle. Since one purpose of these hearings is to review the operation and effectiveness of the Trade Adjustment Assistance programs for workers, firms and communities as provided under Title II of the Trade Act of 1974, we also want to make some appropriate comments in this regard. ADJUSTMENT ASSISTANCE IS NO SOLUTION FOR IMPORT INJURY When adjustment assistance is offered as the alternative to import relief for workers, no one is honest enough to admit the ineffectiveness of the trade adjustment assistance program which Congress added to the Trade Act of 1974. The theory of trade adjustment assistance sounds fine; namely, that the process of international trade expansion can produce hardships on some domestic sectors and that the government should take the responsibility and the initiative to help these sectors effect better utilization of their manpower and capital resources so as to adapt themselves to the new conditions of trade. This would be accomplished by assistance to workers in their transition to new jobs with allowances for retraining and relocation, while firms would be aided in modernizing their plants and productive methods and in shifting lines of production with the help of technical and financial assistance. But putting theory into practice has been another story!" For workers, trade adjustment assistance is basically a dole. It supplements unemployment insurance payments for a short period of time, during which period the workers are supposed to find new employment or training to enable them to find a job in another field. In labor-intensive, import-sensitive industries like ours, finding new employment is almost impossible, because of factors such as the exceedingly high unemployment rate in these industries and limited alternative job opportunities. Moreover, workers in such industries are generally older workers or women, whose families have ties to the community. Even if retraining is available it is not likely and it is often impossible to move to other areas since to do so would break these ties irrevocably. The worker adjustment assistance program, therefore, becomes one of temporary income and turns into welfare after a period of time. The provision of Titles II and III of the Trade Act of 1974 offers much scope for various Administration actions to provide effective import relief, but thus far the Executive Branch has ignored such authority-even when it is urged to exercise it by the International Trade Commission in affirmative escape clause injury findings. Past Presidents, for example, selected adjustment assistance as the remedy for escape clause injury findings on such diverse products as stainless steel table flatware, non-rubber footwear, mushrooms and shrimp processing and fishing. In only two escape clause cases out of 17 that have been decided to date, specialty steel and shoes, was any other form of import relief chosen, and workers in the shoe industry consider the import relief for that industry to be quite inadequate. Again and again we hear from our government officials that adjustment assistance is the appropriate answer for import-impacted industries and their workers. They tell us direct import restraints may be inflationary, that they raise consumer costs, disturb trade relations with our partners, and hold risks of foreign retaliation. But what of our jobs? And the Trade Act's provisions? And the Congress' commitment in that Act to safeguard our jobs? Is not the preservation of our jobs just as lofty an American policy objective? Are not workers also consumers? And does not the loss of jobs involve high costs to the U.S. economy in lost productivity, in lost U.S. taxes and increased public welfare? The Trade Act of 1974 intended to liberalize the trade adjustment assistance program. The changes it made did not alter basic weaknesses of the program. It may be easier to obtain money under the new statute, but it still contains such major flaws that only new legislation can improve it. Trade adjustment assistance has been available to domestic industries hurt by imports since 1962. It has never created a job, never stopped a factory from closing over the long-term, and never will be able to do either. All it can do is prolong the agony of workers and firms constantly faced with a rising tide of imports. Hon. CHARLES A. VANIK, WASHINGTON, D.C., April 1, 1977. Chairman, Subcommittee on Trade, Committee on Ways and Means, House of Representatives, Washington, D.C. DEAR MR. CHAIRMAN: In accordance with the Press Release of the Subcommittee on Trade, Committee on Ways and Means, United States House of Representatives (sometimes hereinafter referred to as the "Subcommittee on Trade"), of March 14, 1977 regarding Congressional oversight hearings on trade adjustment assistance programs under provisions of the Trade Act of 1974, and individual inquiries received from representatives of the Subcommittee on Trade, we request that the following material be incorporated in the record of your hearings: 1. Comments and Recommendations concerning Effective Administration of the Trade Adjustment Assistance Program for Firms under Provisions of the Trade Act of 1974; 2. Letters and Memoranda directed to the House and Senate Appropriations Committees on the matter of Budget Estimates and Requirements for Fiscal Year 1977 concerning Administration of Trade Adjustment Assistance Programs in Accordance with the Intent of the United States Congress as Prescribed under Provisions of the Trade Act of 1974 and Related Statutes. Recognizing that increasing dissatisfaction has been expressed regarding the present effectiveness of the trade adjustment assistance programs, we think it is particularly important that the Subcommittee on Trade has initiated this timely review of the subject in accordance with its oversight of United States trade policy under provisions of the Trade Act of 1974. The enclosed comments and recommendations are based on experience to date, involving proceedings and individual cases under submissions, conferences, legal points and authorities, documentation and evidence, and other considerations regarding petitions for trade adjustment assistance certification and trade adjustment assistance proposals and recovery plans, with particular reference to representation before the United States Department of Comemrce. We have atempted to offer constructive criticism in an effort to improve the trade adjustment assistance programs, and specific affirmative recommendations have been provided for this purpose. We wish to express our appreciation to the Subcommittee on Trade for affording interested members of the public an opportunity to comment on these matters. Respectfully submitted, Enclosure. PAUL H. DELANEY, JR. WASHINGTON, D.C., April 23, 1976. Hon. JOHN L. MCCLELLAN, DEAR CHAIRMAN MCCLELLAN: Enclosed is a memorandum on budget estimates and requirements for fiscal year 1977 concerning administration of trade adjustment assistance programs in accordance with the intent of the United States Congress as prescribed under provisions of the Trade Act of 1974, and related statutes, submitted on behalf of several clients, including firms and communities, which are, and will be, directly effected by administration of the trade adjustment assistance programs under the criteria of the Trade Act of 1974. Respectfully submitted, Enclosure. PAUL H. DELANEY, JR. |