Date: Tue, 21 Sep 2004 23:01:12 -0700 From: Norm Matloff To: Norm Matloff Subject: Bush admin. reviving FTA "H-1B" idea To: H-1B/L-1/offshoring e-newsletter Last year Congress enacted Trade Promotion Authority (TPA) for presidents. It is a fast-track method which basically gives the president a free rein in terms of negotiating trade agreements with other nations. Congress of course must approve trade agreements, but under TPA Congress loses its "line item veto"; it can only vote an agreement up or down in its entirety, rather than approving or rejecting individual provisions. (Congress also passed similar legislation during the 1990s, but it later sunsetted.) What the general public doesn't know is that "trade" includes not only goods but also services. The GATS agreement from the early 1990s, for instance, locked the U.S. in to allowing at least 65,000 H-1B workers per year from other countries. Though some people question the wording of the treaty, the consensus on Capitol Hill is that Congress does NOT have the right to reduce the H-1B cap below 65,000, believe it or not, due to the GATS. When TPA was enacted last year, people like Rob Sanchez and me were predicting that it would dwarf H-1B as a problem for American labor, and in the beginning, that's exactly what it started out doing. The first free trade agreement (FTA) was made with Singapore. As you can see in my posting at the time, http://heather.cs.ucdavis.edu/Archive/Singapore.txt that FTA contained a provision that would make toughening of the L-1 visa impossible in one important aspect. It would nullify the excellent DeLauro bill introduced last year, were it ever to pass. (The FTA also created a special H-1B category.) However, at that point there was an outcry by some Democrats. Their motivation was unclear. Why, for example, would Rep. Sheila Jackson-Lee (D.-Texas Instruments, Inc.), one of the strongest supporters of the H-1B program, object to the immigration provisions of the FTA? In any event, they (reportedly Rep. Sensenbrenner and Sen. Feinstein) were able to exact from Zoellick a promise not to put such provisions in future FTAs. See http://heather.cs.ucdavis.edu/Archive/Chile.txt However, now suddenly the Bush administration is calling on the industry lobbyists to get Congress to allow such provisions in FTAs after all. Zoellick basically is reneging on his promise, and is calling on the industry lobbyists to show Congress who's boss. Details in the enclosed article. Norm http://www.washingtontimes.com/business/20040921-085113-7351r.htm ACCESS EYED FOR FOREIGN WORKERS By Jeffrey Sparshott THE WASHINGTON TIMES September 22, 2004 The Bush administration's top trade official yesterday urged service sector companies to lobby Congress for trade pacts that include easier cross-border movement of professional workers. U.S. Trade Representative Robert B. Zoellick last year negotiated free-trade agreements with Chile and Singapore that created new "temporary entry" provisions for business visitors, intracompany transfers and professionals in sales, marketing and other fields. The language incensed some lawmakers, who complained that immigration rules do not belong in trade agreements. House Judiciary Committee Chairman F. James Sensenbrenner Jr., Wisconsin Republican, and his colleagues forced through changes in the trade pacts' visa provisions and demanded future agreements leave out immigration law. "It is my hope and expectation that the Judiciary Committee's clarion call over the last two weeks that immigration provisions be excluded from future trade agreements will be clearly received by this — and future — administrations," Mr. Sensenbrenner said before the July 2003 votes that approved the two agreements. Mr. Zoellick yesterday at a Capitol Hill forum said that service-sector companies should work with Judiciary Committee members to determine whether they would reconsider. The Chile and Singapore provisions allow 1,400 Chileans and 5,400 Singaporeans to obtain a new category of renewable, one-year visas to work in the United States — a tiny fraction of a civilian labor force of 147.7 million. The visa is available to professionals with specialized knowledge in a particular field. The U.S.-Australia Free Trade Agreement, approved by Congress a year after the other two pacts, did not include immigration provisions. A U.S.-Bahrain pact, not yet approved by Congress, also excludes immigration provisions. Thailand, however, actively is working to ease movement of professional workers with the United States as part of a free-trade agreement under negotiation. Service sector companies include finance, insurance, express delivery, health, law and a variety of other businesses. The firms are some of the United States' strongest exporters, and generate a trade surplus in services. For goods, the trade deficit was $54.5 billion in July, while for services the surplus was $4.4 billion, according to Commerce Department figures. Service sector companies, which often rely on face-to-face meetings to sell their products, generally support easier movement of personnel. The Coalition of Service Industries, a trade association, defended the immigration provisions in the Chile and Singapore agreements last year in congressional testimony. "Moving professional people in and out of foreign countries ... is a critical aspect of services trade," said Norman Sorensen, a coalition member and president of Principal International, an Iowa financial services firm. Copyright (c) 2004 News World Communications, Inc. All rights reserved.