June 27, 2000
Statement by Erik Autor, National Retail Federation
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The U.S. retail sector is a $3 trillion a year industry and employs one-fifth of the U.S. workforce. Retailers also represent a large segment of the importing community.

  • U.S. retailers have to import to remain competitive and to provide their customers the range of products they demand at affordable prices.
  • U.S. retailers import a wide range of consumer products, including textiles and footwear - historically two of the most protected sectors in the U.S. economy.

Imports are not only important to the U.S. retail industry, but to the U.S. economy as a whole:

  • A study by The Trade Partnership commissioned by the National Retail Federation calculated that as many as 10 million U.S. jobs are tied to importing.
  • Many import-related jobs are high-wage jobs: jobs in advertising, banking, wholesaling, even manufacturing. Import-related jobs pump a lot of money back into the economy. Total compensation of these jobs (gross wages, salaries and fringe benefits) in 1997 totaled $325 billion.
  • Jobs supported by imports also include the very type of high-paying jobs that labor unions demand public policy should promote: union jobs, jobs held by minorities and women, and jobs located in urban areas across the United States.

Imports improve the U.S. standard of living.

  • Imports expand the variety of goods available for purchase and improve the year-round supply of such staples as fresh fruits and vegetables.
  • Imports help families make ends meet by ensuring a wide selection of inexpensive goods
  • Imports help to lower the overall rate of inflation in the United States. The Bank of International Settlements found that declining import prices have dampened overall U.S. inflation by about 0.5 percentage points a year.
  • A 1994 Gallup poll found that while Americans say they prefer American products to those produced overseas, that preference is affected by the product's price and falls off sharply of the American good is more expensive. While 32% of those surveyed prefer to buy U.S. products rather than foreign products, that group drops to just 19 percent of those surveyed if the U.S. goods cost 10 percent more than the foreign goods.

As importers, U.S. retailers have to contend with a host of trade restrictions, especially those on clothing and textile products.

  • On textiles and apparel, U.S. retailers face a restrictive quota regime that has been in place for decades and is administered by the Committee for the Implementation of Textile Agreements (CITA).
  • CITA is a unique government entity in that it is unaccountable to anyone and its decisions are not subject to judicial review or the rules of the Administrative Procedures Act.

The good news is that quotas will disappear on January 1, 2005. The bad news is that we expect dumping actions to be filed by the textile industry and the unions once quotas are dropped. In addition, new safeguards actions are available under the U.S.-China bilateral trade agreement that could effectively extend current quotas by other means. That is why it is critical to work with other importing groups among the consuming industries to ensure that our interests are recognized by policy makers with respect to the application of trade remedies.

The only U.S. trade law that allows for consideration of consumer interests is in the remedy phase under Section 201. Consumer groups can weigh in on dumping and countervailing duty investigations before the ITC, but the broader benefits of importing are not typically factored into the Commission's analysis. That analysis is narrowly prescribed: are U.S. producers injured and, if so, did imports cause the injury?

Certainly, the flat panel case and others like it demonstrate that such a narrow construction of the process can be costly to consumers, be they American families or manufacturers. More needs to be done by the ITC to consider the ramifications of implementing a dumping/CVD remedy on consumer groups.

Unfortunately, petitioner groups, such as the steel and textile industries, are well organized, well funded, and have considerable political influence in Congress. While on the other side, U.S. importers are often small companies with limited resources. With respect to the application of trade remedies, most Members of Congress that only foreigners are affected and do not realize that U.S. companies and their workers can also be severely impacted. Our task is to build our political base and educate Members about the impact of U.S. trade laws on American consumers and consuming industries and assure that our views are taken into account.





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