June 24, 2003

Statement of Senator Ron Wyden Before the United States International Trade Commission

Investigation of Drams and Dram Modules From Korea

Thank you very much, Madam Chairperson. I am Ron Wyden, United States Senator from Oregon. I appreciate the opportunity to come before you and your colleagues today to express my concerns about this investigation and its potential impact on workers in my home State of Oregon.I respect and have complete confidence in the Commission's ability and commitment to evaluate all the facts in this case, to understand the complexities of the global and domestic DRAM markets, and to reach an objective, independent decision. I also believe that you, some of whom are former Senate staff, understand my duty to represent the interests of the people of Oregon.Unemployment in Oregon rose again in May to 8.2%, which once again gives Oregon the unwelcome position as the state with the highest unemployment in the country. Oregon is in the third year of economic meltdown, and has become ground zero for economic hurt. The budget crisis in my state is the worst since the Great Depression. 12,400 jobs have been lost in the past year alone.Oregon's economic recovery is my top priority. Every job that can be retained, and every new job that can be created take on greater significance against this bleak economic backdrop. Hynix has made a massive investment in a DRAM fabrication facility in Eugene, Oregon. That facility represents an investment of hundreds of millions of dollars. It employs more than 1,000 people, many in highly-skilled, well-paid jobs, and as such is one of the largest private employers in the state. The jobs at this facility offer a bright light amidst a shadow-filled economy.That is why the Commission's determination in this case is of the utmost importance to me.The Commissioners who are familiar with my 21-year voting record in Congress know that I am a dedicated free trader. I chaired the House Export Task Force for many years, and have served on the Seanate Commerce Committee since I was first elected. I understand the importance of open trade for job creation and for consumers. I also know that some companies believe they can grow their bottom line faster through litigation than competition, and I am afraid that this is the case here. Rather than acknowledge that low prices and oversupply have hurt them, Hynix's competitors would rather pursue a trade case in the vain hope of eliminating Hynix as a competitor. It is no secret that the global semiconductor industry, and in particular the DRAM industry, has been in slump for a number of years. This is the result of a dramatic decline in the demand for semiconductors, and has adversely affected every manufacturer, some worse than others. This is a global problem. This industry historically experiences boom-bust cycles, in which the fortunes of ALL DRAM manufacturers rise and fall together. As your examination of the semiconductor industry will show, the current situation is no different, except that it lasted longer and been more severe than in the past.The key question the International Trade Commission must answer is whether the DRAM industry in the United States has been materially injured or threatened with material injury by Hynix's exports to the United States. In fact, during the overall period you are investigating, Hynix's exports to the United States actually fell. The major reason for this is that production from the Eugene plant (which is not a factor in the determination) was increased as the result of a 2001-2 retooling so Hynix could better serve its U.S. customers from its U.S. facility. It is true that during the retooling of the Eugene plant exports temporarily went up to replace lost production from the Eugene facility, but they fell again once the plant reopened. Because the volume of imports is one of the key factors in your injury determination, I think the fact that exports fell during the period under investigation is very telling.The Eugene facility is an integral part of Hynix's global operations, and whatever determination the Commission reaches will affect the Eugene plant and its 1,000 workers. Those of you who helped write some of the key provisions of U.S. trade law know that the goal is to create fair competition for American workers and U.S. products. Trade law is not intended to serve as a curtain behind which less competitive companies could hide until the global market for semiconductors comes back around. I believe this Commission will reach a fair and just decision that fully considers the depressed state of the world semiconductor market and the decline in Hynix exports to the U.S. during the period in question. In your deliberations, I would also urge the Commissioners to weigh the effect your decision will have on workers in Oregon.Thank you again for hearing my views.