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Congressman Tom McClintock

Representing the 4th District of California

Eliminating Global Marketing Activities of the International Trade Administration - Amendment to H.R. 2578

June 2, 2015

Congressman McClintock offered an amendment to H.R. 2578 - FY16 Commerce, Justice, Science Appropriations Act to eliminate funding for global marketing activities of the International Trade Administration.  The amendment was defeated by a vote of 154 - 263.

Congressman's McClintock's House floor remarks introducing the amendment:

Amendment to H.R. 2578
To Eliminate Global Marketing Activities of the International Trade Administration
June 2, 2015

M. Chairman:

    This amendment enacts a CBO option to cut $312 million for global market activities of the International Trade Administration.

    What does ITA do, exactly?  The ITA has some legitimate functions enforcing trade agreements and treaties.  This amendment leaves these functions untouched.

    But it also – to quote from its own material – “provides counseling to American companies in order to develop the most profitable and sustainable plans for pricing, export, and the full range of public and private trade promotion assistance… as well as market intelligence, and industry and market specific research,” 

    That’s well and good, but isn’t that what businesses and trade associations are supposed to do with their own money?  

    Why should taxpayers pay for the profits of private companies?  

    If a specific business or industry is the sole beneficiary of these services, shouldn’t it be the sole financer of them – either individually or collectively through trade associations?

    True, this program has been around for generations, but Franklin Roosevelt, hardly a champion of smaller government, had the right idea when he slashed its budget back in 1932 and closed 31 of its offices.  The problem is it didn’t take, and today, ITA has over 250 offices and several thousand personnel around the world.  

    The ITA’s authorization lapsed in 1996 – 19 years ago.  It has not been reviewed or authorized by Congress since then, but we still keep shoveling money out the door.  

    Although it hasn’t been reviewed by Congress in all those years, it has been thoroughly weighed by the Congressional Budget Office, the Office of Management and Budget and the President’s Fiscal Commission and they have all found it sadly wanting.   

    The Simpson-Bowles Report summed it up nicely when they said 

    “Services provided by ITA’s U.S. Commercial Services and other Divisions directly providing assistance to U.S. Companies should be financed by beneficiaries of this assistance. While the agency charges fees for those services, its fees do not cover the costs of all its activities.  Additionally, it is argued that the benefits of trade promotion activities are passed on to foreigners in the form of decreased export costs.”  

Simpson-Bowles goes on to say, “According to a study by the Office of Management and Budget (OMB), businesses can receive similar services from state, local, and private-sector entities.”

This CBO option to eliminate ITA’s promotion activities saves $312 million in 2016 and $3.5 billion through 2024.

    M. Chairman, if the CBO, the OMB and the President’s Fiscal Commission all agree this is wasteful and Congress hasn’t bothered to reauthorize it since it expired 19 years ago, why do we continue to spend money that we don’t have duplicating services the beneficiaries of those services either don’t need or are perfectly capable of funding on their own?

    And if the companies that we are told directly benefit from these “essential” services aren’t willing to fund them, maybe that’s just nature’s way of telling us that we shouldn’t be fleecing our constituents’ earnings to pay for them either.  

    And why would we tap American taxpayers to subsidize the export activities of foreigners, as Simpson-Bowles notes?

    The rules of the House were specifically written to prevent this type of unauthorized expenditure – and they provide for a point of order to be raised if it’s included in an appropriations bill.  That’s exactly what we have here.  But alas, that rule is routinely waived when these measures are brought to the floor, making this amendment necessary.  

    This is a prime example of corporate welfare and we ought to be done with it.

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