Washington, DC – Senator Susan Collins (R-ME) today testified as the lead witness in a hearing of the Senate Finance Committee to examine U.S.-China economic relations. Senator Collins testified about the U.S. trade relationship with China and its impact on American and Maine manufacturers. She called for changes in American trade policy in order to counter the unfair competition posed by countries that use illegal trade practices.

“Too many efficient U.S. industries hemorrhage jobs in the face of unfair global competition from countries that use illegal and unfair trade practices. These countries cheat in order to win – at the expense of U.S. manufacturers that play by the rules,” said Senator Collins.

“No state understands this more than my home state of Maine,” she added. “According to a 2003 study by the National Association of Manufacturers, on a percentage basis, Maine has lost more manufacturing jobs in the previous three years than any other state in the nation. I hear from manufacturers in my state time and time again whose efforts to compete successfully in the global economy simply cannot overcome the practices of illegal pricing and subsidies of nations such as China.”

Senator Collins and Senator Evan Bayh (D-IN) have introduced legislation to ensure that all countries doing business with the U.S. are operating under the same rules that help to ensure fair competition for American manufacturers. The Stopping Overseas Subsidies Act (SOS) revises current trade laws to allow the U.S. to enforce anti-subsidy laws, known as countervailing duty laws, on all trade partners. Countervailing duty laws prohibit foreign countries from subsidizing industries and businesses in a way that allows those industries and businesses to sell their goods below the cost that American manufacturers are able to offer. Current trade law does not allow the U.S. to enforce these laws on countries that operate under a state-controlled economy. But the Collins-Bayh legislation updates the law to take into account the fact that many of these countries, like China, now use illegal subsidies to provide advantages to many of their exporting industries.

“One industry important to my state, the residential furniture industry, has experienced devastating losses of jobs due to surges of unfairly priced furniture imports from China. One furniture manufacturer in Maine, Moosehead Manufacturing, has been forced to eliminate a quarter of its employees due to unfair market conditions. Unfairly priced and subsidized imports from China are a leading cause in these job losses,” said Senator Collins. “Countries such as China want to have all the benefits of engaging in international trade. They cannot be allowed to cheat on the system with no penalties. It is time these countries were held to the same standards as other countries around the world.

“The Collins-Bayh legislation gives U.S. industries the tools to ensure that no country gets a free pass on trade enforcement.”