- The Washington Times - Friday, November 18, 2005

The House voted early yesterday to kill a law that has distributed about $1 billion from importers to U.S. manufacturers while running afoul of the World Trade Organization.

House lawmakers tacked the repeal into a larger measure meant to trim federal spending by almost $50 billion over five years.

The Senate’s version of the budget cut, however, would not eliminate the law, setting up a potentially tough fight as the two chambers work to reconcile their versions of the spending measure.

Formally called the Continued Dumping and Subsidy Offset Act (CDSOA) but better known as the Byrd Amendment, the law since 2001 has allowed U.S. companies to complain that foreign competitors are selling their products below cost in the United States. If they convince the government that is the case, duties are slapped on the foreign goods and the revenue is handed over to the companies that brought the complaint.

Before the law, named for Sen. Robert C. Byrd, the West Virginia Democrat who attached it to a broader bill in 2000, the money would go to the U.S. Treasury rather than the companies that filed a complaint.

The Government Accountability Office in September said five U.S. companies are collecting almost half the Byrd payments, and three industries — bearings, candles and steel — are collecting two-thirds of the total.

In addition, the WTO, responding to complaints from 11 U.S. trade partners, found the Byrd amendment illegal in January 2003.

The WTO authorized up to $134 million in retaliatory tariffs in response, though that figure would rise if companies file more complaints under Byrd Amendment rules and more money is disbursed to them.

Canada, authorized by the WTO to hit the U.S. with $11.2 million in sanctions this year; the European Union, authorized $27.8 million; Japan, authorized $52.1 million; and Mexico, authorized $20.9 million, have slapped tariffs on U.S. exports of swine, tobacco, dairy and other products.

“The inclusion of the Byrd repeal in the House budget reconciliation package provides a great opportunity to finally repeal this flawed law,” said Adam Peterman, spokesman for Rep. Jim Ramstad, Minnesota Republican and sponsor of the repeal legislation.

He called the rule “the ultimate combination of protectionism, corporate welfare and government waste. It costs taxpayers millions of dollars in subsidy payments and consumers millions in higher costs.”

The Bush administration also wants Byrd repealed, but the law remains broadly popular in the Senate.

“Should legislation regarding budget reconciliation move toward conference, we would urge the Senate not to accede to any provisions that may be included in the House bill that would repeal CDSOA,” said Sen. Mike DeWine, Ohio Republican, and 24 colleagues in a Nov. 4 letter to Majority Leader Bill Frist.

Mr. DeWine, who represents the home state of bearing manufacturer Timken Co., the largest beneficiary of Byrd payouts, and his colleagues said the rule benefits hundreds of companies, farmers and ranchers while combating unfair trade practices of other countries.

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