COLUMN: Time is Short for Congress to Protect Farmers from Costly COOL Retaliation

June 12, 2015
Weekly Column and Op-Ed
By Rep. Dan Newhouse

The clock is ticking for American farmers and manufacturers to avoid billions of dollars in sanctions and tariffs on U.S. exports to our biggest trading partners. On May 18, the World Trade Organization (WTO) rejected a U.S. appeal and ruled in favor of Canada and Mexico on mandatory country of origin labeling (COOL) requirements for beef, pork, and chicken products. WTO found that COOL requirements for muscle meat cuts were in violation of U.S. obligations with our trading partners, Canada and Mexico. This is the fourth time WTO has ruled against the U.S. on COOL requirements. Why is this ruling significant? Unless Congress acts to protect American producers by bringing U.S. rules into compliance, Canada and Mexico have taken steps to retaliate within the next few weeks against the U.S. to the tune of $3 billion in annual sanctions on American agricultural and non-agricultural goods.

Retaliation over COOL requirements will not just have a negative impact on American beef, pork, and chicken products: retaliation can apply to hundreds of millions of dollars’ worth of Washington exports of apples, cherries, pears, potatoes, wine, and manufactured goods as well.

In arguing against repealing COOL, some falsely claim that COOL requirements are really about food safety. However, meat products produced or imported in the U.S. are already subject to mandatory inspection by the U.S. Department of Agriculture’s Food Safety Inspection Service (FSIS). Additionally, before arriving in the U.S., imported meat products are required to be produced with an equivalent food safety system to that of the U.S. The reality is that all meat products sold in the U.S., regardless of origin, must be inspected to equally rigorous standards. The repeal of COOL will have no impact on the FSIS food safety inspection program, ensuring that the U.S. continues to produce the safest food supply in the world.

If COOL is not about food safety, does that mean it implies an economic benefit? Compliance with COOL actually adds additional costs for American packers, processors, producers, and ultimately consumers. Given Washington’s proximity to Canada, processors depend on Canadian cattle, but under the mandatory COOL requirement, U.S. and Canadian cattle must be processed separately, adding increased cost with no safety benefit. Further, even when repealing mandatory COOL, there is nothing preventing producers from continuing to marketing their products as U.S. cattle – it just is not a requirement.

Congress must act quickly to prevent potentially devastating retaliation in the form of sanctions and tariffs, which is why I cosponsored legislation to repeal country of origin labeling requirements as an urgent response to the WTO’s ruling. Last week, I voted with the House on a bipartisan basis, 300 to 131, to pass this legislation to shield American farmers from retaliation by simply repealing the COOL meat cut provisions to make the U.S. compliant with our obligations.

The U.S. must play by the rules we agreed to with our biggest trading partners and export markets. Time is running out to avoid the costly penalty of trade sanctions, which is why I urge the Senate to pass mandatory COOL repeal.