President Bush proposed more funding for international trade and import safety programs, as well as enforcement of trade remedy laws in the $3.1 trillion federal budget submitted to Congress on Monday.
This story first appeared in the February 5, 2008 issue of WWD. Subscribe Today.
The 2009 fiscal year spending request seeks to eliminate or reduce the budget for 151 programs, saving $18 billion over five years.
Bush’s plan calls for boosting national security and defense spending, and seeks to extend and make permanent tax cuts that expire at the end of 2010. The budget for the 2009 fiscal year, which begins Oct. 1, projects a deficit of $410 billion for the 2008 fiscal year ending Sept. 30 and $407 billion for the following year, which partly takes into account a proposed $150 billion economic stimulus package that could be enacted in 2008 if Congress acts.
Democratic leaders in Congress, who plan to push for higher spending for social programs such as health care, criticized Bush’s plan and the cuts in those initiatives. The majority Democrats will introduce their own proposals and, as they did last year, revise Bush’s plan to reflect their spending priorities.
“Democrats reject the misplaced priorities of the President’s budget, which once again is a step backward for our nation,” said House Speaker Nancy Pelosi (D., Calif.). “The President’s misguided budget cuts health care for seniors and working families, freezes live-saving medical research, raises health care costs for veterans and slashes energy assistance, all at a time of rising prices and a slowing economy.”
Among the proposed changes in spending programs affecting the fashion industry are:
l Another $6 million, raising to $46 million, the appropriation for the U.S. Trade Representative’s Office to negotiate deals with other countries and in the World Trade Organization.
l A $3 million boost, to $66 million, for the Commerce Department’s Import Administration, which investigates antidumping and countervailing duty trade cases and monitors apparel and textile imports.
l An $8 million increase, to $49 million, for a Commerce program to help U.S. manufacturers and service providers compete with foreign rivals.
l Continued funding of $5 million for the Wool Trust Fund, which gives grants to domestic manufacturers of worsted wool fabric.
l A $6 million rise, to $74 million, for the International Trade Commission, which conducts economic investigations and helps decide antidumping and countervailing duty trade cases.
l An increase to $10.9 billion for the U.S. Customs & Border Protection division of the Department of Homeland Security, which oversees the ports and border entry points, seizes counterfeit apparel, footwear and accessories and manages a public-private supply chain security initiative.
l A $67.7 million jump, to $157 million, for the radiation port monitoring program at U.S. ports. Customs scans 100 percent of all containers at the southern border and 91 percent of all containers entering the northern border. The goal is to have 100 percent scanning of cargo containers by the end of the year, said Homeland Security Secretary Michael Chertoff. The agency requested $27.3 million to hire 295 Customs officials to assist in the deployment of the monitors to ports. A program requiring scanning of all U.S.-bound containers at foreign ports within five years is being developed.
l A $17 million increase, to $199 million, for the Labor Department to enforce the Fair Labor Standards Act and other labor laws.
l A $66 million cut, to $15 million, for the Labor Department’s international labor affairs division, which helps coordinate the global activities of other U.S. agencies and nongovernmental organizations.
The Bush administration budgeted more money to enforce trade laws at a time when Congress is considering punitive legislation to combat China’s undervalued currency and subsidized imports that critics say put U.S. producers at a competitive disadvantage, leads to job losses and drives up the trade deficit.
The budget includes a proposed $4.2 million in additional spending within the Import Administration appropriation to enforce countervailing duty laws with respect to China and other nonmarket economies.
“It puts their money where their mouth is,” said Stephen Lamar, executive vice president of the American Apparel & Footwear Association. “If they can show they’re doing more on the enforcement side, it gives them more ammunition against damaging legislation that’s now pending before Congress.”
An increased emphasis on the trade remedy laws could eventually cause trouble for importers.
“The concern is that both Congress and the administration are going to find ways for petitioning industries to file cases and get relief,” said Erik Autor, vice president and international trade counsel at the National Retail Federation. “In other words, they’re going to make it easier for them to block imports by messing with the rules.”