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CONSUMING INDUSTRIES URGE PRESIDENT TO LET SOFTWOOD LUMBER AGREEMENT EXPIRE

Washington, DC - Consuming industries today urged President George W. Bush to let the U.S.-Canada Softwood Lumber Agreement ("SLA") expire, stating that the agreement disguises "subsidies to American producers that will make new homes and other construction more expensive and hurt many more Americans than they would help."

In a letter sent today to President Bush, Jon Jenson, Chairman of the Consuming Industries Trade Action Coalition ("CITAC"), said that the SLA "unfairly injures lumber consumers " and "concerns all Americans interested in affordable new homes and economic growth."

The SLA requires Canada to impose export restrictions on lumber exported to the U.S. market. As a result, it threatens industries dependent on open markets for lumber, including all homebuilders, furniture manufacturers, makers of shelving and other home accessories and other industries. These industries employ some six million workers - more Americans than are 'protected' by the agreement.

According to the American Consumers for Affordable Homes, the extra burden on downstream industries gets passed on to homebuyers. New homes in this country can be up to $1000 more expensive because of the SLA. That translates into 300,000 American families that get priced out of the market for a new home.

According to the CITAC letter, "the SLA also suffers from extremely dubious legality under international trading rules. The World Trade Organization rightly condemns such 'gray area measures' as alien to the principles of open markets and trade liberalization." With U.S.-Canadian talks looming, resolution of the lumber issues is of the utmost importance in our relationship with our largest trading partner.

Last week, Representatives James Kolbe (R-AZ) and Steny Hoyer (D-MD) announced the introduction of a resolution to the House, calling for an end to the SLA. At that time, the resolution had 69 bipartisan sponsors in the House and a similar resolution in the Senate also gained bipartisan support.

According to Jenson, "It's very simple. Canada has a comparative advantage in lumber and consuming industries and America's families, have the right to choose the best product at the best price. Instead, today, the homebuilders and the American people are paying the price for protection. We think the Administration should right that imbalance."

CITAC is a coalition of companies and organizations, which are committed to promoting a trade arena where U.S. consuming industries and their workers have access to global markets for imports that enhance the international competitiveness of U.S. firms.

CITAC's letter to President Bush is attached.