Sleeping Bag Maker Seeks Trade Deal Exemption
Politics can make for strange bedfellows, and sometimes it’s bedfellows campfire-style.
Take the case of Sen. Jeff Sessions (R-Ala.), who has found an ally in Sen. Sherrod Brown (D-Ohio) in a fight over trade deals, American jobs and sleeping bags.
Sessions’ once-lonesome effort to change a key trade agreement to protect an Alabama sleeping bag manufacturer has bonded two of the Senate’s most ideological opposites in a fight that has raised difficult questions about the scope of the GOP’s earmark ban.
“It’s standing up for American manufacturing,” Brown said Wednesday of the fight. “So I want to help Sessions fight on it.”
Sessions said that while many of his colleagues may be unhappy that a significant trade law lapsed at the beginning of the year because of his demands, he is content to hold out because he believes he’s on the side of fairness.
“We’re hemorrhaging jobs,” Sessions said. “We’ve got to make sure we favor our legitimate trade” needs.
“We have to fix it,” he added.
The law, known as the Generalized System of Preferences, is designed to allow for duty-free imports of certain goods from developing countries such as Indonesia, Thailand, Uruguay and Bangladesh. The goal of the law is to provide economic assistance to the world’s poorest countries while creating a source of cheap materials for U.S. companies.
When first enacted, the law included exemptions for certain types of products — including textiles — to protect U.S. manufacturers. But the law has long been interpreted to not cover sleeping bags.
Over the past 14 months, Sessions has worked in support of calls by Exxel Outdoors, an Alabama manufacturer of low-cost sleeping bags, to change the definition of textiles to cover sleeping bags.
Late last year, lawmakers sought to push through an extension of the GSP, but Sessions refused to agree to a unanimous consent agreement without the sleeping bag change. As a result, the legislation died and the agreement lapsed.
Imports of products covered under the law have dropped sharply since then, and supporters said tens of thousands of U.S. jobs are at stake if Congress does not quickly extend the law. And given the emphasis that voters have put on jobs over the past two years, Sessions’ intransigence has rubbed some of his colleagues the wrong way.
Democratic and Republican opponents of Sessions’ demands say that regardless of the merits of his position, House rules and Senate GOP rules define any legislation providing an individual company with a trade benefit — even language that enacts a “fix” to current law — as an earmark and therefore dead on arrival.
“There is just no question that a carve-out of this nature is not only a violation of the spirit of the earmark ban but the very letter of it. Changing an entire trade agreement for the benefit of one company in one state is precisely the kind of thing Republican leadership is tasked with preventing,” a former GOP leadership aide familiar with the situation said Wednesday.
Supporters of the change, however, reject that argument.
“It’s not giving a tariff benefit to anybody,” said Ron Sorini, a lobbyist with Sorini, Samet & Associates who represents Exxel. Rather, Sorini said, Sessions is simply seeking to fix an unintended loophole in the law and that sleeping bags “should have never been designated as GSP. … [It is] an error that should be corrected.”
Over the past three years, Exxel has paid Sorini’s firm $70,000 to lobby Congress on the issue.
Sessions shares the view that making this fix isn’t an earmark. “I don’t know how it’s an earmark. We’re basically trying to amend legislation that … unfairly impacts a company,” he said.
Others blame the logjam on renewing the GSP law on a territorial dispute between Sessions and Minority Leader Mitch McConnell (Ky.).
Brown bluntly said that the standoff is due to the “McConnell situation” and that the powerful Republican has balked at including the fix in the legislation because it would harm CellCorp USA, a Kentucky-based sleeping bag importer.
Brown argued that putting CellCorp USA ahead of Exxel makes no sense. “There’s like five jobs in Kentucky. I don’t think they even handle the sleeping bags,” Brown said.
McConnell’s office vehemently denied any suggestion that it is in a dispute with Sessions over sleeping bags. “Leader McConnell believes this is an important trade bill that should be extended,” the spokesman said.
CellCorp USA President and CEO Mark Harris agreed, saying that while he has discussed the issue with McConnell’s office, it has not taken up his cause. According to Harris, McConnell’s office “simply asked to be updated on the situation. … Beyond that I wouldn’t say Sen. McConnell or his office is doing anything beyond staying apprised of the situation and keeping me apprised.”
Another hurdle that Sessions faces in getting his fix included in the bill is talk of the precedent it would create by changing a trade deal to satisfy the wishes of a single company.
According to Exxel CEO Harry Kazazian, he has also been told by lawmakers and aides in both chambers that even if they are sympathetic to his company’s plight, they are concerned it could set a dangerous precedent. “There have been some concerns about the precedent,” Kazazian said earlier this month.
A Senate GOP aide acknowledged those concerns, arguing that if Congress includes language to help Exxel, then other companies are sure to come forward and demand similar arrangements.
It appears that little progress will be made toward an agreement. Sessions said Wednesday that he would continue to hold any extension of the GSP until Exxel’s situation is resolved. The law “has led to them being unfairly disadvantaged. We’ve got to have a system that responds to that,” Sessions said.