ATMI: INSIDE THE BELTWAY
Byline: Scott Malone
WASHINGTON — The members of the American Textile Manufacturers Institute headed to the nation’s capital for their annual meeting, in a move intended to underline the group’s newly refined focus on lobbying.
To emphasize that point, the organization paraded out a half-dozen top government officials, including three senators, two congressmen and the chairman of the Joint Chiefs of Staff.
Their message to the mill executives assembled was clear: With a Republican president and a narrow Republican majority on Capitol Hill, this is the time for the industry to make its voice heard — if the many groups within it can agree on what they want and stand together.
Divisions within the industry most recently came to a head in the debate over how to implement the Trade and Development Act of 2000, which granted duty- and quota-free access to apparel made with U.S. fabrics in the Caribbean Basin Initiative nations.
Fabric mills argued that qualifying goods must be dyed and finished in the U.S., a provision that was not important to yarn makers. Currently, the rules don’t require U.S. finishing, though ATMI officials said they believe there is still a chance to get that changed.
“Politics is a team sport,” Rep. Lindsey Graham (R., S.C.), said in an address Friday, the second day of the three-day event. “The textile business better be a team sport or you’re going to lose your franchise. The steel folks are together. We need to form alliances with farmers and people in the steel industry, everyone who is being unfairly affected by fair trade.”
Graham questioned the wisdom of establishing freer relationships with China, saying he believed it poses as great a threat to the U.S. as did the former Soviet Union.
“We’re looking to China and all we see is a quick buck,” he said. “Where is the money going to go that the trade generates? I believe it’s going to go into tanks, ships and missiles.”
Graham’s speech preceded an appearance by Sen. Strom Thurmond (R., S.C.), whose seat Graham intends to run for in 2002, after Thurmond retires. The ATMI presented Thurmond and Sen. Jesse Helms (R., N.C.) with the Samuel Slater Award for contributions to the U.S. textile industry.
Presenting the awards, Roger Chastain, chairman and chief executive officer of Mount Vernon Mills, who finished his term as president of the ATMI at the meeting, said the two “have done as much for the American textile industry as anyone inside or outside of the U.S textile industry.”
Helms, who walked with the aid of a cane, joked that, along with Thurmond, who walked with the help of two aides, “We look like the Spirit of ’76.”
Thurmond, 98, who has repeatedly emphasized that he intends to serve out his six-year term, said: “During my time in the U.S. Senate, I have done my best for the textile industry and I want you to know I will continue to work for you.”
Another legislator to make an appearance was Rep. Sue Myrick (R., N.C.), who weighed in on the dyeing-and-finishing issue, saying that her office has sent letters to the U.S. Customs Service requesting that the preliminary rules be amended to require that garments qualifying for CBI parity be made of fabric dyed and finished in the U.S.
The domestic dyeing-and-finishing requirement also has its backers in the Senate, among them Sen. John Edwards (D., N.C.), who said, “I strongly support the requirement that fabric be dyed and finished in the U.S. to get the benefits of this bill. That is something we are going to continue to push for.”
General Henry Shelton, chairman of the Joint Chiefs of Staff, who spent a few years working at a mill before entering the army, said preserving the textile industry is important to the nation’s defense.
“We in the military are very conscious of the buy-American act,” he said. “It is a national-security issue, the industrial base of this country.”
Myrick noted that Customs will be establishing an office of trade compliance, which U.S. manufacturers will be able to call upon when they see violations of trade laws. Such an office had been proposed by the Clinton administration, but never received the funding to get off the ground.
Carlos Moore, ATMI executive vice president, said his group’s concern is that the compliance office not just focus on the concerns of exporters, but also work on import issues.
“The problems that really hurt us,” he said, “are problems like Customs fraud.”
The ATMI also remains concerned about market access. While some have expressed skepticism that domestic mills could ever generate substantial revenue by exporting U.S.-made fabrics, Moore pointed out that overall, U.S. fabric exports were up last year and claimed that when trade barriers are lifted, U.S textile exports rise.
“If those markets open, say India, China and others,” he continued, “they start trading with each other and they don’t look to Europe and the U.S. as the only markets they can sell to.”
Myrick said that getting other nations to lift trade barriers is a tough challenge, and that it’s not always at the top of the Washington agenda.
“Getting open markets for textiles is just as difficult. In fact, we haven’t started with the Bush administration just yet,” because all the relevant trade officials have not yet been confirmed in office, she said. However she held out hope that Congress would be able to do something to help mills.
Chuck Hayes, chairman of Guilford Mills, who took over as president of the ATMI, said pushing the political agenda would be a priority.
“Our whole lives depend day-to-day on what happens here in Washington. The textile industry has to be a bigger factor in dealing with the Hill,” he said, adding that he wants to build “coalitions” within the industry to push government issues, like stronger enforcement of trade laws.
However, for all the talk of reaching out to new allies, many were mum on the group’s falling out with textile titan Roger Milliken, whose company had been the ATMI’s largest member and to whom the group had once given the Slater Award.
Hayes said Milliken’s departure made sense because of differences on trade policy. “There are some within our industry that have their own agenda,” Hayes said. “Mr. Milliken has an agenda of his own. I’m not going to say if it is right or wrong.”
Milliken was not the only major textile player absent at the meeting. The ceo’s of many of the nation’s top mills — while still members of the group — did not make the trip, including ones at Burlington Industries, Cone Mills and Galey & Lord.
The ATMI’s Moore chalked that up to a matter of bad timing.
“A number of our bigger company ceo’s are out of the country on business,” he said. “It’s just the press of business.”
In previous years, the ATMI’s annual meeting had been held in more glamorous settings, including Bermuda, Puerto Rico and Southern California.
On Saturday the group distributed a survey to its members asking what they thought of the location. Hayes said a decision would be forthcoming soon.
In his address to members before stepping down as ATMI president, Chastain walked through the details of the organization’s recent downsizing. He said the step was taken to reflect poor business conditions in the industry. The group has cut its dues rate by 10 percent, and overall, this year its operating budget is down 30 percent, to $1.6 million.
The group also named named Joe Gorga, chairman and ceo of CMI Industries, a large knitter based in Greensboro, N.C., as its second vice president, putting him in position to take the reins of the ATMI in 2003.