" So here's the thing, if Congress did exactly all the right things with their domestic law -- increased inspection, put third party certification into the plants in China, etc. China, as a WTO member -- something Congress delivered with a vote -- has the authority to drag the U.S. to one of the WTO foreign tribunals and basically claim we have to gift get rid of our law because it's a violation of their WTO rights. It's outrageous. " -- Lori Wallach
Did you know this? I sure didn't
It's easy for everyone to blame China for the tainted food and toxic toys but nothing will change until consumers understands what caused this situation and demand change.
In the following transcript from yesterday's Lou Dobbs broadcast, Kitty Pilgrim interviews Lori Wallach of Global Trade Watch on her testimony to Congress on this issue.
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Well, more Congressional testimony today about how Communist China is flooding this country with millions of dangerous toys and poisonous food products.
Lori Wallach with Global Trade Watch was one of the people who testified today on Capitol Hill and she joins us now. Thanks, Lori, for being with us.
You really do know your stuff on this issue. I've seen you on Capitol Hill many times over the past months. One of the things you say -- and you told the House Subcommittee on Commerce, Trade and Consumer Protection today is that the root cause of this is U.S. trade policy.
Can you explain that a bit for our viewers?
LORI WALLACH, PUBLIC CITIZEN: Basically, we've seen a series of trade agreements that resulted in good jobs out, bad products in. For instance, right before NAFTA was the peak of U.S. toy prediction at home. After NAFTA, the companies moved for the $6 a day wages. Then, in 2001, after Congress voted to let China into the WTO, all the jobs went to $1 a day China, to a point where now, literally, we have 25 percent of the jobs in the industry. So it's not surprising the production has been moved to countries like China, where there's no safety structure.
Are we shocked that then when those toys get sent back in, they're dangerous?
WALLACH: We've created a problem with our trade agreements.
PILGRIM: It certainly seems so.
We have some Peru and Panama agreements pending.
Will this make the problem worse, do you believe?
WALLACH: Well, if the definition of insanity is to do the same thing and expect a different result, these are some crazy ideas to expand NAFTA to Peru and Panama, which is what's at stake. So we're taking the NAFTA model, which both sets limits on safety standards and limits how much products can be inspected at the border, and we're literally incorporating the worst part of NAFTA and WTO and extending those failed agreements to more countries. It's a very bad idea.
PILGRIM: One of the things that you explained so very well is how the U.S. is limited in their inspections of foreign operations.
Why is that?
Is that built into the trade agreements?
WALLACH: So, trade agreements like NAFTA, like the NAFTA expansions to Peru and Panama, they have a rule that says you can't treat foreign goods differently than you treat your domestic goods. Now, in the case of imported food or toys, that's crazy because when you have a production in a place where -- the business guys call China the wild, wild east -- there's no regulation, then you need really tight inspection on the way back, versus in the U.S., there are many levels of inspection. The final check is the final touch. But under our trade agreements, we're required to keep domestic and foreign goods the same, even if we have a good reason, a serious safety reason based in fact to do otherwise.
PILGRIM: So these are written right into the agreements?
We agree to this up front?
WALLACH: It's crazy, but I always hoped members of Congress didn't know. But now they know and that's why they shouldn't vote for these Peru and Panama NAFTA expansions.
Now, the thing is we need to fix our trade agreements. We need to update our laws because, you know, the laws were written when a lot of this stuff was made here. We need to update our laws to take into account it's being made in places where there is no safety standard. And we need to get money from the importers to pay for the extra expenses of inspection in China and at the border.
They wanted to go for dollar a day wages and get rid of all those jobs, they should pay for the added costs to make sure the products they want to send back under those conditions are safe. Let's not add insult to injury.
PILGRIM: And yet they say they're raising prices in the interests of safety.
Is that a bit duplicitous?
WALLACH: Well, if you look at the profit margins of these companies that offshore jobs from the U.S., where they were paying union wages and benefits, to a dollar a day in China, where they're dumping their waste on the ground, etc. It's very duplicitous. They can -- they can take a nip out of the profits to make sure our kids aren't being exposed to dangerous kids, so that they can profit through race to the bottom trade agreements.
PILGRIM: Now, Lori, one of the things I love about talking to you is that you not only point out the flaws, you propose some suggestions.
So let me run through a few of yours.
Eighty percent of the toys sold in this country are made in China. In your testimony today, you urged a three-pronged approach. And we'll put this up so our viewers can take a look at it, too -- expand and improve authority of domestic inspection and safety agencies. You also say increase funding for U.S. imports both overseas and at the border. And after provisions of U.S. trade agreements are altered, alert provisions of U.S. trade agreements which limit border inspection of imports.
All three of those things have to be done simultaneously to actually remedy this problem.
WALLACH: Well, here's the crazy thing. Most Americans don't realize that by getting into trade agreements like NAFTA or WTO or this proposed expansion of NAFTA and CAFTA to Peru and Panama, we agree to make all of our domestic laws conform to the trade agreements. And when we have a law that's more safety protective, more pro-environment or health, we can get challenged in a foreign tribunal.
So here's the thing, if Congress did exactly all the right things with their domestic law -- increased inspection, put third party certification into the plants in China, etc. China, as a WTO member -- something Congress delivered with a vote -- has the authority to drag the U.S. to one of the WTO foreign tribunals and basically claim we have to gift get rid of our law because it's a violation of their WTO rights. It's outrageous.
We've got to change those provisions.
PILGRIM: Let me just bring out Nancy Nord, the acting chairman of the CPSC, had this to say about -- there are going to be new recalls and she had this to say about the situation.
(BEGIN VIDEO CLIP)
NANCY NORD, ACTING CHAIRMAN, CPSC: While it may appear that we're undergoing an epidemic of lead paint on toys, these recalls have served their intended purpose. Not only are they getting violative products off the shelves and out of consumers' hands, but they have caused the entire toy industry to change practices to prevent such violations from occurring in the future.
(END VIDEO CLIP)
PILGRIM: We only have a few minutes, but there are expected more recalls.
So isn't this explaining the problem away a bit?
WALLACH: Well, first of all, recalls don't give back all the dangerous products. The trick is to not get them on the market. But listening to Chairman Nord, I have to say, she should be an export himself -- right out of that job. We need someone who actually is interested in protecting our safety.
What she's basically saying is trust the companies. But the fact that we have all these recalls is evidence the companies regulating themselves aren't cutting it. And all this stuff is getting out to our kids.
Plus, think of all the small companies. Think of the ones that don't have the fancy brand names. I bet the problem is a lot bigger than the recalls, because the only way we ever know anything is wrong is if a company fesses up.
There's no Consumer Product Safety Council inspector. There's no one watching what's going on. If the company didn't fess up, our children are probably playing with the stuff. That's why we need new government policies, change the trade agreements and more funding for inspection paid for by the companies that took off to the dollar a day unsafe venues.
PILGRIM: Lori Wallach, we are glad you're on the case.
And thanks for talking to us tonight.
WALLACH: Thank you.
PILGRIM: Lori Wallach of Public Citizen.
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The following is a more in depth discussion by Lori Wallach on this issue
Other posts on this issue:
China Bashing - A Diversionary Tactic
Consumer Safety -- Not Much Has Changed ...
More on The Politics of Food Safety
The Politics of Food Safety