WASHINGTON — Sen. Robert C. Byrd, the powerful West Virginia Democrat who died at age 92 on Monday after serving a record 51 years in the U.S. Senate, was the prime mover of a contentious trade law intended to help domestic manufacturers.
This story first appeared in the June 28, 2010 issue of WWD. Subscribe Today.
The legislation, which was dubbed the Byrd Amendment, stipulated punitive tariffs collected by the U.S. on imported foreign goods that were subsidized or “dumped” on the U.S. market for less than their cost in their home country could be distributed to domestic companies hurt by the imports. President Clinton signed the bill in 2000.
From 2001 to 2003, U.S. companies ranging from steel producers to textile firms received $728 million in reimbursements from tariffs collected by the government. But the payments ran afoul of global trade rules when a World Trade Organization panel ruled they constituted an illegal and unfair subsidy in September 2002. A WTO appellate panel upheld that decision in 2003.
The law backfired on the apparel industry because the European Union retaliated against U.S. importers, initially imposing 15 percent tariffs on exports of 10 kinds of U.S.-made apparel after Congress failed to repeal the Byrd Amendment. The EU later expanded its retaliatory tariffs to a larger group of U.S. apparel exports.
Byrd fought several attempts by Congress and the administration of President George W. Bush to repeal the law in order to comply with the WTO ruling.
“To repeal or abandon this trade law would be a travesty,” Byrd said in a speech on the Senate floor in December 2005. “The [bill] was enacted to save American manufacturing and our agricultural producers from wave after wave of unfairly dumped foreign imports.”
Byrd charged that the WTO was “wrong in opposing” his bill and “overzealous in ruling against the law; it overreached.” However, under pressure from industries being hit with WTO-sanctioned retaliatory tariffs on U.S. exports from the EU and Canada, and later Japan and Mexico, Congress repealed the law in February 2006.
The law funneled a total of more than $1 billion to U.S. companies hurt by undervalued and subsidized imports.