Senate agrees to flip Byrd Amendment, but slowly
The US Senate has voted to go ahead and repeal the Continued Dumping and Subsidy Offset Act, or Byrd Amendment, a controversial part of The Deficit Reduction Act of 2005.
The decision to delay its repeal until October 1, 2007, however, is a compromise between the House of Representatives and Senate. Consequently, Byrd Amendment distributions will continue for entries made prior to that date. All that is left now is for the conference to head back to the House to resolve any discrepancies between the House and Senate versions that are not directly related to the Byrd Amendment. Thereafter President Bush should quickly sign the legislation into law.
The Byrd Amendment allows antidumping and countervailing duties collected in trade remedy case to be distributed to companies that petitioned or supported antidumping and countervailing duty actions.
Named after its author West Virginia Senator Robert Byrd, the law has been criticized heavily as “Corporate Welfare” because it rewards already profitable companies with millions of dollars. Since it began in 2001, the Byrd Amendment has rewarded $1.26 billion to various companies with over $475 million of that going to the Timken Company and its subsidiaries.
In fact, more than two-thirds of all Byrd payments have gone to only three industries: steel, candles, and bearings. In 2005, more than half of the $226 million in Byrd distributions went to five companies; 80 percent went to only 34 companies.
In 2002 the World Trade Organization ruled that the Byrd Amendment violated US trade laws and urged its repeal. Since then,
Canada, the European Union,
Japan, and
Mexico have all initiated WTO-authorized retaliations against a variety of US exports.
It is unclear when the House will reconsider the act but could do so by the end of this year or they may wait until January.