Congress Has Far Reaching Textile Agenda

When the second session of the 107th Congress convenes January 28 it will have considerable
unfinished business that will impact the textile industry. While an economic recovery program,
taxes and dealing with terrorism and home security will be grabbing the headlines, international
trade, tax and farm legislation will be of equal importance to textile manufacturers, organized
labor and importers.Just before Congress left for its year-end recess, the Bush administration put
forth a nine-point program designed to address some of the U.S. textile industrys economic
problems. Several of these issues will require congressional action.One of the first issues likely
to come to the forefront is a commitment from the Republican leadership in the House to enact
legislation that would require textile and apparel products qualifying for benefits under the
Caribbean Trade Partnership Act to be dyed and finished in the U.S. The House leadership promised
to deal with this issue at the earliest opportunity, so it could be attached to the first
international trade bill to be considered.Legislation that would for the first time incorporate
textiles and apparel in an Andean Nation preferential trade program passed the House, much to the
consternation of the U.S. textile industry, and is awaiting action in the Senate. Since the current
law, which does not include textiles and apparel expired in December, quick action is expected. The
American Textile Manufacturers Institute strongly opposes extending the trade preferences to
textiles and apparel, but the proposal is supported by the American ApparelandFootwear
Association.Legislation granting broad trade promotion authority to the President passed the House
by a single vote in last December, and it is pending in the Senate Finance Committee. If the Senate
makes any changes in the bill, it will have to return to the House, where there could be another
major showdown involving textile state congressmen. The bill passed the House with key support from
textile state legislators who voted for it in return for promises from the administration that it
would take steps to address textile trade problems. If those members do not feel the administration
is following through, they could scuttle the trade promotion bill.In connection with the economic
stimulus package passed by the House and pending in the Senate, the textile industry is seeking at
least a five-year tax loss carryback, repeal or reform of the alternative minimum tax and faster
depreciation for machinery.And, finally the U.S. textile industry will be lobbying hard to
safeguard the cotton competitiveness program which is part of the Farm Bill pending in the Senate.
The industry wants to eliminate the 1.25 cents per pound differential between world and domestic
prices in order for the program to be activated. ATMI estimates that repeal of the 1.25 cent per
pound requirement would save American textile companies some $50 million annually.