[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]



 
                 DEPARTMENTS OF COMMERCE, JUSTICE, AND

                   STATE, THE JUDICIARY, AND RELATED

                    AGENCIES APPROPRIATIONS FOR 2002

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS
                              FIRST SESSION
                                ________
  SUBCOMMITTEE ON THE DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE 
                    JUDICIARY, AND RELATED AGENCIES
                    FRANK R. WOLF, Virginia, Chairman
 HAROLD ROGERS, Kentucky
 JIM KOLBE, Arizona
 CHARLES H. TAYLOR, North Carolina
 RALPH REGULA, Ohio
 TOM LATHAM, Iowa
 DAN MILLER, Florida
 DAVID VITTER, Louisiana            JOSE E. SERRANO, New York
                                    ALAN B. MOLLOHAN, West Virginia
                                    LUCILLE ROYBAL-ALLARD, California
                                    ROBERT E. ``BUD'' CRAMER, Jr., 
                                    Alabama
                                    PATRICK J. KENNEDY, Rhode Island

 NOTE: Under Committee Rules, Mr. Young, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
    Gail Del Balzo, Mike Ringler, Christine Ryan, and Leslie Albright
                           Subcommittee Staff
                                ________
                                 PART 5
                                                                   Page
 Secretary of Commerce............................................    1
 United States Trade Representative...............................   89
 National Oceanic and Atmospheric Administration..................  167

                              

                                ________
         Printed for the use of the Committee on Appropriations
                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 77-308                     WASHINGTON : 2002

                                  COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

 RALPH REGULA, Ohio
 JERRY LEWIS, California
 HAROLD ROGERS, Kentucky
 JOE SKEEN, New Mexico
 FRANK R. WOLF, Virginia
 TOM DeLAY, Texas
 JIM KOLBE, Arizona
 SONNY CALLAHAN, Alabama
 JAMES T. WALSH, New York
 CHARLES H. TAYLOR, North Carolina
 DAVID L. HOBSON, Ohio
 ERNEST J. ISTOOK, Jr., Oklahoma
 HENRY BONILLA, Texas
 JOE KNOLLENBERG, Michigan
 DAN MILLER, Florida
 JACK KINGSTON, Georgia
 RODNEY P. FRELINGHUYSEN, New Jersey
 ROGER F. WICKER, Mississippi
 GEORGE R. NETHERCUTT, Jr., 
Washington
 RANDY ``DUKE'' CUNNINGHAM, 
California
 TODD TIAHRT, Kansas
 ZACH WAMP, Tennessee
 TOM LATHAM, Iowa
 ANNE M. NORTHUP, Kentucky
 ROBERT B. ADERHOLT, Alabama
 JO ANN EMERSON, Missouri
 JOHN E. SUNUNU, New Hampshire
 KAY GRANGER, Texas
 JOHN E. PETERSON, Pennsylvania
 JOHN T. DOOLITTLE, California
 RAY LaHOOD, Illinois
 JOHN E. SWEENEY, New York
 DAVID VITTER, Louisiana
 DON SHERWOOD, Pennsylvania
   
 VIRGIL H. GOODE, Jr., Virginia     DAVID R. OBEY, Wisconsin
                                    JOHN P. MURTHA, Pennsylvania
                                    NORMAN D. DICKS, Washington
                                    MARTIN OLAV SABO, Minnesota
                                    STENY H. HOYER, Maryland
                                    ALAN B. MOLLOHAN, West Virginia
                                    MARCY KAPTUR, Ohio
                                    NANCY PELOSI, California
                                    PETER J. VISCLOSKY, Indiana
                                    NITA M. LOWEY, New York
                                    JOSE E. SERRANO, New York
                                    ROSA L. DeLAURO, Connecticut
                                    JAMES P. MORAN, Virginia
                                    JOHN W. OLVER, Massachusetts
                                    ED PASTOR, Arizona
                                    CARRIE P. MEEK, Florida
                                    DAVID E. PRICE, North Carolina
                                    CHET EDWARDS, Texas
                                    ROBERT E. ``BUD'' CRAMER, Jr., 
                                    Alabama
                                    PATRICK J. KENNEDY, Rhode Island
                                    JAMES E. CLYBURN, South Carolina
                                    MAURICE D. HINCHEY, New York
                                    LUCILLE ROYBAL-ALLARD, California
                                    SAM FARR, California
                                    JESSE L. JACKSON, Jr., Illinois
                                    CAROLYN C. KILPATRICK, Michigan
                                    ALLEN BOYD, Florida
                                    CHAKA FATTAH, Pennsylvania
                                    STEVEN R. ROTHMAN, New Jersey

                 James W. Dyer, Clerk and Staff Director

                                  (ii)


DEPARTMENTS OF COMMERCE, JUSTICE, AND STATE, THE JUDICIARY, AND RELATED 
                    AGENCIES APPROPRIATIONS FOR 2002

                              ----------                              

                                             Thursday, May 3, 2001.

                         DEPARTMENT OF COMMERCE

                  COMMERCE DEPARTMENT'S FY 2002 BUDGET

                                WITNESS

DONALD L. EVANS, SECRETARY OF COMMERCE
    Mr. Wolf. The hearing will begin. Mr. Secretary, we welcome 
you to the hearing. We look forward to working with you over 
the next four, or hopefully eight, years, whatever it is, but 
your full statement will be in the record and you can 
summarize.
    But before you do, I will recognize Mr. Serrano.
    Mr. Serrano. Thank you, Mr. Chairman. It is, indeed, a 
pleasure to welcome you, Secretary Evans.
    As I look over your budget, I am always amazed at the scope 
of programs and activities within the Commerce Department. From 
the depths of the oceans to outer space and all over the world, 
your people are doing valuable work to benefit all of us.
    I represent the poorest District in the country, so I am 
particularly interested in efforts to close the Digital Divide 
and make new technology accessible to all.
    Similarly, I represent a District that had the worst 
undercount in the 1990 decennial census, so I am keenly 
interested in getting the most fair and accurate numbers 
possible out of the 2000 count.
    I look forward to hearing from you. And, as I do about this 
time, I remind everyone that I have no sisters, one brother, 
and he has been working for the Census Bureau longer than I 
have been in Congress. Just that for the record, Mr. Chairman, 
and he is still looking for a window in his office, so maybe we 
can talk about that. [Laughter.]
    Mr. Wolf. You are welcome to begin. There is a vote on, but 
we are going to try to rotate so you can continue to go. Go 
ahead.

                            Opening Remarks

    Secretary Evans. Thank you, Mr. Chairman, very much. I am 
delighted to be here.
    Congressman, nice to meet you. I think a window is on the 
way. It is probably a few years off, but I think we have a 
building on the drawing board and it will soon be under 
construction and hopefully, your lone brother will have a 
window.
    This experience of the last 100 days has been similar to my 
experience over the last 26 years of my life, which has been in 
the private sector I have spent a fair amount of my time in the 
private sector going through a budget that will determine how 
we would spend our money in the ensuing year. It is a good 
process. It is an important process to go through.
    It is always a process that the people that you are working 
with kind of wonder, at times, why you are going through it, 
but it does give you a unique opportunity and time in the year 
to remind everybody what your missions are and what your goals 
are, and what your objectives are.
    In the private sector, I used to remind the team that it 
was not their money. But it was money that belonged to the 
shareholders of the company, and here the same principles 
apply.
    You are simply reminding the team that it is not their 
money, but they should treat it like it is their money. And so 
it has been a healthy process for me to have the opportunity to 
go through it to have a broader, deeper understanding of this 
vast Department that I now feel the responsibility for.
    As Congressman Serrano mentioned, there are a lot of 
agencies and bureaus and a lot of issues that the Commerce 
Department takes responsibility for.
    So this has been a good chance for me to get a deeper 
understanding of the budget.


                           doc budget growth


    As you said, Mr. Chairman, my full remarks will be included 
in the record. I appreciate that. The budget that we are 
requesting for 2002 is a decrease from the 2001 budget.
    But I would like to put that in context quickly and say to 
you that over the last 11 years, the budget for the Commerce 
Department has grown about 8 percent per year. If you look at 
the last five years, it has grown about 7 percent per year.
    If you look at the last three years, the budget for the 
Commerce Department has grown about 10 percent per year, so I 
commend this Committee. I commend Congress for funding the 
Commerce Department in a fiscally sound and responsible way.
    I think the budget that we have presented and requested is 
a very effective and responsible budget. It funds the 
priorities. I ask, through our budget process, that the teams 
and the departments and bureaus focus heavily on their core 
mission, their core responsibilities, and the core purpose of 
their agencies.
    I don't think there is anything more important when you go 
through this process than for everybody to clearly understand 
and be reminded each year what your core mission is.
    Certainly in Commerce it is to foster and continue the 
economic growth of this country.
    So I think we present to you a very responsible and 
effective and reasonable budget. What I would like to do is 
just touch on a few of the highlights and then I would of 
course be happy to answer any questions that you might have.


                        highlights of doc budget


    I would begin with International Trade. It is obviously one 
of the principal areas of responsibility for the Commerce 
Department.
    I have had occasion to begin to travel around the world. I 
have been to Argentina. I was in Quebec, and the messagewill be 
free and fair trade with an emphasis on ``fair.''
    I do not think there is anything that dispirits the 
American worker, the American businesswoman or the American 
businessman quicker than to think they are not playing on a 
level playing field.
    So I would again commend this Committee and Congress for 
taking the initiative to enhance the budget a year ago, which 
provided for additional compliance officers so that we can do 
the important duties of controlling market access, market 
responsibilities, market agreements, and bilateral agreements. 
It is very important that we make sure that we are enforcing 
the laws of the United States.
    I know that the budget in 2001 allowed for 62 new employees 
to be added to the compliance area. So I am pleased that we are 
in that process and we will continue that process.
    Allow me to give you a specific example. In the area of 
enforcing the U.S. laws, we have 119 Orders out there in the 
steel industry on countervailing duty and anti-dumping. We also 
have 36 investigations underway.
    So it is something that we will continue to put a lot of 
emphasis on, because, as I say, I do not think there is 
anything that dispirits the American worker any quicker than to 
think that they are not playing on a level playing field.
    Also in the area of trade on the export side, we have 
requested an increase in the Export Administration budget of $2 
million. That $2 million will be spent on enhancing our 
technology systems to improve the efficiency of the export 
license process which would benefit companies that are trying 
to export their products outside the United States.
    I think that will help keep our technology industry 
competitive on a worldwide basis, and I am glad we are 
requesting that.

                   critical infrastructure protection

    Another area we are asking for an increase is in the 
Critical Infrastructure Protection. It is an area that is 
receiving a lot of attention right now within the Executive 
Branch.
    We are taking a hard look at just how this effort should be 
structured and organized. Commerce is playing a vital role in 
it, and we should play a vital role.
    It requires close coordination with the private sector, 
which Commerce has been responsible for. Many of the critical 
infrastructure issues that you need to concern yourself with 
are managed in the private sector, so we need to stay close to 
them.
    We have for agencies, actually, inside Commerce that are 
involved in the whole Critical Infrastructure Protection area, 
one being the Bureau of Export Administration where the 
Critical Infrastructure Assurance Office is located. They are 
responsible for playing a management role in it.
    NIST is responsible for conducting some research and 
development programs, as well as grant programs, and has a 
special forces team that goes around various government 
agencies to make sure that their infrastructures are protected.
    And then of course, NOAA plays a very important role. And 
so that is part of the reason we requested an $8 million 
increase.
    [The following was subsequently provided:]

    NTIA plays a role in support security initiatives with the 
information and communications sector.

                             economic data

    Secretary Evans. Another area that goes back to the core 
mission of Commerce, it is important that we provide this 
country good econmic data to make decisions. GOP estimates are 
produced by the Bureau of Economic Analysis, which is part of 
the Economics and Statistics Administration.
    One of the areas of concern of the Department, as well as 
Chairman Greenspan, over the last number of years is our 
consistently underestimating the Gross Domestic Product growth 
in this country.
    If you look at the record over the last eight or nine 
years, you would say that we have consistently underestimated 
GDP by about 50 basis points.
    When you use that number to put together a ten-year budget, 
if you underestimate GDP growth over a ten-year period in this 
economy, it would mean that you are underestimating the surplus 
over a ten-year period by about $1 trillion.
    Conversely, obviously, if you overestimate the GDP growth 
by 50 basis points, you would overestimate the surplus by 
$1trillion.
    So it is very, very important that we have the resources 
committed to making sure that we can do the best possible job 
of providing the economy and the decisionmakers with the 
economy good data on which to make decisions.

              manufacturing extension partnership program

    In the area of technology, one of the crown jewels of 
government, quite frankly, is the National Institute of 
Standards and Technology. There are some terrific programs 
there. One of them is the Manufacturing and Extension 
Partnership Program.
    It works with small businesses across America. If you look 
at those small businesses across America that have participated 
in this program, you will see that their productivity is some 
four times what comparable companies are that have not 
participated in the program. So it is a terrific program.

                           nist core mission

    But one of the areas again that I think is very important 
for us to think about when we are talking about NIST is the 
core mission and to make sure that they stay focused on their 
core mission.
    We have a new lab that has just come out of the ground in 
the last year. It is the Chem Lab [Advanced Chemical Sciences 
Laboratory ACSL], as we refer to it. It is important that, 
within the Chem Lab, we are provided the right equipment, the 
right facilities; that we are state-of-the-art; we are cutting-
edge technology so that our scientists there can have the tools 
they need to go about their work.
    We have another building that is coming out of the ground, 
which is the Advanced Measurement Lab. The first wing will be 
completed within the next 12 to 18 months.
    I think it is important, again, that we have the resources 
there that will make sure that we are providing the necessary 
equipment, tools and technology that these scientists will need 
inside this building to continue to lead the industry and to be 
on the cutting-edge.
    So NIST is a very important agency and one that we stay 
focused on, but again we are asking our team to be mindful that 
we need to be focused on the core mission of that very 
important department.

                         global climate change

    Global climate change. I would make note that we have 
requested some $265 million of research for global climate 
change. We are a very important participant in that whole 
effort. That will continue.
    It is an area that is under active consideration and review 
by this Administration, so I am glad we have those funds in our 
budget to continue to be supportive of that.
    NOAA is 65 percent of the budget. It has moved from some 
four years ago. NOAA was 52 percent of the budget and now it is 
65 percent of the budget. It is a terrific team of people 
playing a very important responsibility in this country.
    We are very proud of the National Weather Service in NOAA. 
We have requested a budget for the National Weather Service of 
some $658 million.
    We have asked for a $29 million increase to improve the 
service as well as expand the research within NOAA. We also are 
asking for increases so that we can improve flood predictions 
throughout this country, particularly in the Mississippi and 
Ohio River area.
    In addition to that, another area that NOAA is keenly 
involved in is the satellite programs. We have requested an $83 
million increase for a satellite, which is the National Polar 
Orbitins Environmental Satellite System that will be in 
cooperation and conjunction with the Department of Defense.

                          SPECTRUM ALLOCATION

    Finally, let me conclude by talking about NTIA. One of the 
critical areas that they are in is spectrum and spectrum 
allocation. We have requested a $2 million increase in NTIA for 
equipment to measure spectrum. We know how important it is to 
get the spectrum allocation right in this country and we have 
ten-year-old equipment trying to measure spectrum.
    We need to enhance that, and so we have asked for a $2 
million increase or request to help fund new equipment to 
measure spectrum.
    Let me conclude there, Congressman, and say to you that I 
will be glad to respond to any questions that anybody might 
have and tell you, again, that I am delighted to be here.
    [The complete statement follows:]


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Miller [presiding]. Mr. Secretary, it is a pleasure to 
have you here. Everybody did not get mad and leave 
intentionally or anything. There is a single vote on.
    Secretary Evans. I wondered whether I was running everybody 
off, or what had happened. [Laughter.]
    Mr. Miller. There is a single vote on, and it is sometimes 
easier, as soon as that bell rings, if one of us can scoot over 
there, cast that vote, and come back and we can continue the 
hearing and make more efficient use of your time.
    We were at a hearing yesterday with General Ashcroft, and 
we had to delay it because we had two votes. It was like a 45-
minute delay, and I know your time is important and valuable, 
so it is easier for me, I think, to go ahead and start asking 
some questions and such.
    I have a couple of different questions mainly on, I guess, 
the Census and NOAA.
    I think we have to congratulate the Bureau for the job they 
did. The professionals came through and did the best Census 
ever, as we know, and we are very pleased with the success they 
had.
    I had my concerns a few years ago. I felt they were going 
down the wrong path and the courts put them back on the right 
path in my opinion. I was worried they were going to get caught 
up in that delay of making sure they did a full count.
    But luckily this Congress gave all the resources they 
needed. You can say a higher percentage went to NOAA and all, 
but a lot of it is because we gave a lower--the Census does not 
need the money that they have had in the past. We've spent $6 
billion on the Census, and we are down to, I forget, the exact 
number now.
    Let me ask a couple of questions about the Census. We are 
going to have a hearing. I know Mr. Barron is with you there.

                    census american community survey

    Now on the American Community Survey, one of the 
controversial issues we got into last year or the year before, 
a couple of years ago, during the Census is the long form, and 
it caused a lot of concern for privacy issues, and was it going 
to impact the quality of the data.
    I do not know if we know the answer of that yet. If we do, 
we are interested to find out whether--because people were 
concerned that the long form would discourage a response, or 
that some people just did not complete all the questions--the 
long-form questions, were they going to be usable data and 
such.
    Can you make a comment about where we stand on the issue 
about replacing the long form and the American Community Survey 
and the money that is going into that, and such?
    Secretary Evans. Yes, Congressman, we are testing the 
American Community Survey form this summer. We obviously do not 
have the results yet, since we are doing it this summer but in 
talking to Bill and the professionals on his team, it seems to 
me that we are very comfortable that this is going to be a 
successful effort.
    We will be coming back to you and coming to this Committee 
requesting the funds for the American Community Survey to 
replace the long form, which will turn into an annual survey of 
three million households a year, which would be able to, in 
getting that many households, be able to provide most of the 
large metropolitan areas' data on an annual basis. And even, I 
guess, in the smaller towns we would be able to provide data to 
them every three years, I think Bill has told me.
    So while we do not have the results yet, looking at the 
form and the professionals considering it, they are pretty 
confident that this test will show us that we should use the 
American Community Survey to replace the long form in the years 
ahead. I do not know the exact numbers on it.
    Ms. Retzlaff. $56 million total in 2002. That is between 
the American Community Survey, $27 million, and $29 million for 
the long form transitional data base program.
    Mr. Miller. So the intention is to proceed with the 
American Community Survey?
    Secretary Evans. That is correct, Congressman. That is 
correct.
    And I might add to that, if you do not mind just for a 
moment, that we really do consider that as kind of a key to the 
2010 Census. As we look out ten years and build on the great 
improvements that we have seen this last Census, the 2000 
Census, what are ways we can do an even better job in 2010?
    We really think that the American Community Survey is 
something that will play a key role in that. We think that we 
will begin planning immediately and this will also play a key 
role.
    We think using technology will help us--using technology to 
a much greater degree than we did this last Census in locating 
buildings and houses and using some of the satellite technology 
that we have.
    So it is kind of a three-legged stool-approach. We have got 
three basic parts we think will make this 2010 Census much 
better.

                              2010 census

    Mr. Miller. Yes. And I see the amount of money that has 
been requested for the 2010 Census is quite a bit more. I think 
it is $65 million.
    Last year it was $20 million or so. I guess we will start 
ramping up every year more for the next several years? Any 
comment about any more about the 2010 Census preparations?

                     estimated cost of 2010 census

    Secretary Evans. Well they have not presented to me the 
full plan for 2010 yet. I have asked for it. They are focused 
on it.
    Again I have heard a range of numbers that we think we are 
estimating of what the 2010 Census may cost or that may be 
requesting.
    So I am really not prepared, I guess, at this moment to 
talk about it in great detail, but I would say to you that I do 
think it is very, very important that we begin our focus on 
2010 immediately and do the kind of things, to take the kind of 
steps and actions and, in fact, spend the kind of money, quite 
frankly, that I think will make the 2010 Census the most 
accurate ever.
    Specific numbers, I do not know. Bill, do you want to offer 
any kind of backup to that?
    Mr. Barron. In terms of 2010?
    Secretary Evans. Yes.
    Mr. Miller. She may need to have you close to a microphone 
or she will not be able to--if you are going to make a comment, 
introduce yourself, too, I think. Yes.
    Mr. Barron. On a very preliminary basis, Mr. Miller, 
looking at 2010 and just taking what we did in the most recent 
Census and moving it forward for inflation, as we canpredict 
it--and I am not saying we are perfect at making those predictions--and 
also looking at the cost of the American Community Survey, if we did 
nothing, we would probably be looking at a program that is somewhere 
between $11 billion and $12 billion, and a lot of that is just 
inflation moving forward.
    So it is really that issue that is motivating us to work 
with the Secretary to see if we can't produce a program that 
involves some cost containment but also improves accuracy.
    I think what we are seeing in the Census Bureau is, that at 
the end of the '90 Census there was a lot of thought that we 
have gone about as far as traditional Census-taking can get us.
    We think with some of the hearings you have held--
considering comments from both sides of the aisle--there are a 
lot of improvements in traditional Census-taking yet to be 
made. That is going to be part of our package that we come 
forward with.
    Mr. Miller. A couple more questions. Do you want me to come 
back, or do you want me to finish up while I am started here?
    Mr. Wolf [presiding]. Go ahead.

                                  ace

    Mr. Miller. Would you just update me on the status of the 
ACE issue?
    Secretary Evans. Yes, I guess the status is that the 
evaluation continues and that we have set a fall target to be 
in a position for a completed evaluation of ACE. Really, I do 
not think there is a whole lot more to say about it than that.

                             noaa research

    Mr. Miller. Let me ask you a quick question about NOAA. I 
am in a coastal area on the Gulf of Mexico.
    There have been a couple of problems with NOAA funding for 
southeast research, which is what I want to look at, research 
in some areas. It is one of the most earmarked areas of the 
whole appropriation area.
    There is also a geographic imbalance there. For example, in 
the southeast from Louisiana to Texas, all the way to Virginia, 
does not receive equal funding and, you know, we should not 
allocate money just because it is the southeast, but it is a 
huge area--and other areas get a very large, and, in my 
opinion, disproportionate amount of the money.
    So I have had a concern about the imbalance--and it is 
partly because of the heavy earmarkings. So I am not sure what 
we can do, because we do it on the Appropriations Committees 
here in the House and the Senate but I have a concern about the 
imbalance for the southeast. We made some strides this past 
year to help correct that.
    So it goes, as I say, the southeast goes all the way from 
the Texas coast and the Gulf of Mexico all the way up to 
Virginia. I do not know if it includes the Potomac, Mr. Wolf, I 
do not know if it goes to the water's edge, but anyway it is a 
concern I have, and I just want to make sure you are aware of 
that concern that we need to keep working to try to keep a 
balance there with the other coastal areas of the country.
    Secretary Evans. Good. Thank you, Congressman. I will take 
a look at it.
    Mr. Miller. Thank you, Mr. Chairman.

               international trade administration / mfnc

    Mr. Wolf. Thank you, Mr. Miller. Mr. Secretary, there may 
be a series of votes, so, if there is, we will try to keep 
moving so you do not have to stay here all day.
    When you testified, you mentioned International Trade, and 
a thought was just kind of triggered and I wanted to ask you a 
question to see if you had any comments about it.
    One, personally I appreciate very much the attitude and the 
position of the Administration with regard to the China issue 
so far.
    I know Secretary Daley had a big part up here with regard 
to MFN or PNTR. I never quite understood why they changed it. 
MFN was like Coca-Cola. Everyone knew about it. We had passed 
it for Jackson-Vannick, and yet I think I know why they maybe 
changed it. Because the American people would have been 
confused by going to PNTR, but MFN or PNTR.
    When you are looking at these issues with regard to trade 
and China--and I am generally a free-trader, although I do not 
worship at the free trade altar--insofar as, you know, there 
was tremendous and totally free trade with Nazi Germany. You 
should read Tony Blankley's column that he did the other day 
for The Washington Times whereby the British were trading with 
the Nazis right up to the time that the German Army was 
crossing the border.
    But when you think in terms of China, if you think in terms 
of these issues, there are 14 Catholic bishops in jail in China 
today. There were 12 up until two weeks ago. Two were arrested, 
one on Good Friday. And you know the importance of Good Friday. 
And another was arrested just thereafter.
    So there are 14 that are in prison. The one that was 
arrested on Good Friday had been in jail for 30 years before 
that. And you know the problem the Church is having in China.
    There are about 150 to 200--it is a moving number--
Protestant pastors, house church pastors, who basically hold 
services in their homes because they cannot have churches.
    I was in Tibet several years ago. We went in through the 
back way with a trekking group, and I broke off and we met with 
a lot of the Buddhist monks and nuns who told us of the 
plundering and the torture--I mean, not torture in the sense 
that--but real torture and the persecution of those who are 
Buddhists. They have destroyed three to four thousand 
monasteries. It would be like St. Albans being destroyed.
    They are persecuting the Moslems in the northwest portion 
of the country tremendously. Very few people speak out. Not 
many people know there are many Moslems there, but there are 
really about 50 million.
    There are more slave labor camps in China today than there 
were in the Soviet Union when Solzhenitsyn wrote the best-
selling book, A Gulag Archipelago. In fact, as our people over 
across the river can tell you where they are, in 1991, 
Congressman Smith and I were in a Beijing Prison Number One 
whereby we saw 40 Tienanmen Square demonstrators making socks 
for export to the United States.
    Life in the Logi and slave labor camp is very, very grim. 
Some people go there for 17, 18, 19 years. The one-child policy 
with regard to forced abortions. There were women that we 
talked to who were literally tracked down and forced to have an 
abortion.
    There are many other issues which, you know, you could go 
on and on about. But they are selling weapons to countries in 
the Middle East that are a direct threat to the national 
security of the United States.
    In the country of Sudan--and I know the President 
hasmentioned Sudan twice in a speech--the Chinese have now built a 
pipeline. The Chinese National Petroleum Company. And with that hard 
currency that they are now giving to the Khartoum government--and as 
you know in the Khartoum government, every major terrorist group in the 
country, in the world, in the Middle East, Hamas, Hezbollah, have 
training camps around Khartoum and out in the countryside.
    I have been to Khartoum. I have been to Sudan four times, 
the last time in January where they are bombing Catholic 
churches--and I saw you at the inauguration of President Bush 
sitting there--Franklin Grams'hospital, Samaritan Purse, has 
been bombed.
    I think the best approach was when Ronald Reagan--I 
remember the speech that Ronald Reagan gave in 1983 in Orlando, 
Florida where he called the Soviet Union the Evil Empire.
    I am not suggesting we call the Chinese the Evil Empire. 
But Ronald Reagan never gave MFN to the Soviet Union. Ronald 
Reagan in fact in 1985 signed a bill--it was my bill and I 
remember it well--to take away MFN from Romania for the 
persecution of the church.
    And I just, one, I want to thank the Administration, 
because everything I have heard spoken by the Administration 
has been very positive, has been very, very realistic.
    I do not think the Chinese are our strategic partners. I 
think they can be our friends. Poland was behind the Iron 
Curtain, and now we work very closely with Poland. Romania, we 
have given them MFN, and Hungary, and we are seeking to have 
friendships in the former Soviet Union, now Russia.
    But I personally believe that some of them--and I am going 
to have some questions later on--some of what we may very well 
be selling to China may very well be used for the persecution 
of the Church, but also may very well be used in national 
defense with regard to the United States.
    I sent you a copy of a book called Hegemon. I do not know 
if you saw the book or if you read the book, but it talks about 
the whole concept of what is going on.
    I do not know if you have any comments, but I just speaking 
for myself--I certainly do not have the right to speak for any 
other Member on this issue--Ronald Reagan talked about trust 
but verify, and I think the best export that we have is when we 
export our values, our values of freedom of religion.
    The Catholic Church is of no threat to the Chinese 
government. I mean, the Catholic leadership that I have met 
with over there, they pray for the government. They are no 
threat. They have never spoken out against their government.
    The Protestant Evangelical House Church leaders, they are 
of no threat to that Chinese government.
    The Tibetan Buddhists are very meek, very mild. They are of 
no threat.
    It is against the law in Lasa in Tibet to have a picture of 
the Dalai Lama.
    And since you are going to be a leader--are a leader in the 
Administration and will be speaking out with regard to the 
issue of trade, I think it is important that the Administration 
maintain its consistency that it has so far.
    And in everything I have heard President Bush say he has 
talked about he was going to speak out on human rights and 
religious freedom, but I think we have to be careful because I 
think the men and women who wear the uniform may very well be 
facing some of the things that we may very well be selling both 
to China and what China is selling to Iran and Iraq and some of 
those countries.
    I do not know if you have any thoughts about that, or if 
you just want to pass and we will go to the next questioner.

                           export enforcement

    Secretary Evans. Mr. Chairman, I would say a couple of 
thoughts on this.
    One, I would say that in terms of the exports, I will go 
back to my earlier comment, how important it is to vigorously 
enforce our laws.
    And I was pleased that for the first time in some seven or 
eight years, I guess we have an Export Administration Act that 
may be passed this year. And I think it will help us deal with 
not only the export issue but with some more muscle and more 
teeth.
    And so I am really looking forward to having some certainty 
regarding our Export Administration laws, and then being able 
to enforce those laws. As far as I know, my team tells me that 
we are rigorously enforcing the laws now, and I am not aware of 
any major issues in that area.
    When it comes to China--I totally agree with you and the 
comments you made that the most important thing we can trade is 
our values and our freedom. I am one that thinks that goes 
hand-in-hand with free trade and fair trade.
    I do think that as we open up the world to trade and we 
communicate more with our neighbors, they will better 
understand our free enterprise system and how it works. They 
will begin to participate in our free enterprise system and 
they will see economic growth in their own countries. They will 
also see job creation in their counties. I think that 
automatically leads to and will go hand-in-hand with the social 
freedoms that we cherish.
    So, I do not see an inconsistency in free trade and fair 
trade and being able to use that as a tool to trade the 
cherished values that we have in this country with all parts of 
the world.
    Mr. Wolf. Well, I was not going to read this. This is the 
Tony Blankley column. Let me read it. It will be in the record, 
and I will submit the whole column in the record and I will 
give you a copy.
    [Tony Blankley column follows:]


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                             trade failures

    Mr. Wolf. He writes, and I am quoting from the column, he 
said, ``Just before the outbreak of World War I, Britain was 
swept away with the belief that the extensive trade relations 
between the great powers made war unthinkable. Norman Angell's 
huge 1910 British best-seller, The Great Illusion, which argued 
against increased defense spending, caught the mood of the 
time. International finance,'' and he quotes, ``has become so 
interdependent and so interwoven with trade and industry that 
political and military power can in reality do nothing.''
    And Blankley says, ``unfortunately, Germany wanted the 
status of a global power more than it wanted continued 
prosperity. Ten million European young men and a quarter of a 
million Americans died because their leaders assumed right to 
the last day of peace that war was unthinkable in a time of 
such interconnected prosperity. Nor, by the way, did years of 
German prosperity before the war lead to an increase in the 
democratic process.
    ``Again, less than a year before the outbreak of World War 
II and after Hitler had taken the Rhineland, Austria and most 
of Czechoslovakia, British Prime Minister Neville Chamberlain 
instructed the governor of the Bank of England to offer the 
Bank of Berlin extensive low interest loans that would 
encourage the opening of the German economy. Where trade would 
flow freely across the borders, Chamberlain hoped that the 
German army would not. World War II followed with 50 million 
dead.
    ``Other obvious examples where intimate trade relations did 
not deter war include our own Revolutionary War against England 
and our own Civil War. All these examples of trade's failures 
involve nations and people who were culturally, historically 
and ethically close. Why should we assume as a basis for 
strategic policy that such relations between us and culturally 
distant China would succeed where it has so often failed under 
more hopeful circumstances?''
    And then he says, ``The foregoing is not an argument 
against normal trade relations with China. It is intended as a 
Scotch verdict on the utility of trade as a path to peace not 
proven.''
    And I think we have to be careful. There was a letter to 
the editor in yesterday's Wall Street Journal with regard to 
IBM and the Holocaust. IBM was trading with Nazi Germany up to 
and even during World War II. And I think the difference--and I 
will not mention this too much more--but the difference--but I 
feel passionately about this. Because I have been into the 
prison and I have seen the people and I have talked to people 
and I have been with the house church people, worshipping with 
them. And I have been in Tibet and listened to the monks who 
told me of that. And I have talked to the people that have been 
in Tiananmen, and I have talked to the people that have been in 
Logi. I really do worry that this allure of trade will do it.

                       export of torture devices

    As a free trader, it bothers me a little bit, because I did 
support NAFTA, but I think there is a difference of free trade 
and yet arming a potential adversary. And I think the model for 
us, the model for me, is really the model that Ronald Reagan 
had.
    And with that, I will just end and maybe cover one other 
question in that you can maybe answer it if you want to or just 
submit it for the record, because you may not know about this. 
But in February, Amnesty International produced a report 
documenting the continued practice of torture in China. Torture 
through beatings, whippings, electric shock, sexual abuse and 
other sometimes deadly means.
    The research reveals that during 1998 and 2000, at least 
185 businesses were involved in the manufacture, the 
distribution, supply or brokering of devices that always or 
sometimes were used to inflict torture. Of these, the United 
States is by far the most prolific, with at least 74 U.S. 
companies involved in marketing electroshock weapons, leg 
irons, shackles, thumb cuffs, always used for torture devices.
    Could you give us some sense of maybe you are going to have 
somebody look into this to see if the policy of the Department 
of Commerce could change with regard to the export of these 
torture devices that are pretty clearly torture, whether it be 
to China or Turkey or any other country?
    Secretary Evans. Certainly. You bet I will.
    Mr. Wolf. Great.
    Secretary Evans. I am not familiar with this particular 
article that you read or this specific issue, but we will look 
into it and get back to you.
    Mr. Wolf. I thank you, Mr. Secretary.
    Secretary Evans. Thank you, Mr. Chairman.
    Mr. Wolf. Mr. Serrano.
    Mr. Serrano. Thank you, Mr. Chairman. In listening to you, 
Mr. Chairman, and Secretary Evans, I am trying to suggest that 
the Chairman and I are the opposite sides of trade, because I 
am a big believer in trading with everyone. However, in 
listening to his comments about people we do trade with, I must 
tell you that it reinforces my belief that we have no reason 
not to trade with Cuba. Because if we can trade with all these 
other folks, we certainly can trade with Cuba.
    Which brings me to a question which was not going to be my 
first question, but since I am on that subject, I will ask the 
question now. We did pass a bill last year, after much debate, 
which in my opinion watered down the original intent of a bill 
I and former Congressman Torres and other folks had introduced, 
to allow the open sale of food and medicine, food items or 
seeds and so on, agriculture items and supplies and equipment 
for Cuba. We passed that bill with a lot of strings attached, 
as you know, about financing and so on.
    But there were parts that your department had to do in 
putting forth regulations to make this possible. Those 
regulations I understand were supposed to be in place by the 
end of February, and I believe that they are not in place yet. 
Could you comment on that as to where those regulations might 
be?
    And I understand that one of the arguments is what happens 
to the products if they are sold, if they are purchased, when 
they get to Cuba. As much as that was always a concern, that 
was not part of the legislation. The legislation was to sell 
food and medicine to Cuba. And I would like to know where we 
are with that in terms of the regulations.
    Secretary Evans. Certainly. Congressman, my knowledge is 
that we are very, very close to having the regulations in 
place. I was not aware of the February deadline. But it is my 
understanding that they will soon be in place. I would say 
``soon'' probably means by the end of May they will be in 
place.
    But the one area that I think we need some clarity is that 
it is my understanding the way the law reads, this will be 
trade of food to Cuba and not food and medicine. So I think 
thatis something that we want to make sure we have clear.
    Mr. Serrano. I could stand corrected. My understanding was 
that, again, notwithstanding all the regulations that were 
imposed on it, it would allow food and medicine. I am not sure 
if it would allow--and the reason we are not sure, and the 
reason you may not be sure is because the bill left the 
Committee one way and came back to the floor--actually left the 
floor one way and came back into law in a different way, and do 
not ask me how that happened. Something that happened in Texas 
that I have no control over.
    Secretary Evans. Congressman, let's do this. Let's let your 
staff get with our staff. I am hearing that there was a 
drafting error in the bill itself, and it may have taken 
medicine out. But I am not certain of that. So let's get your 
staff with our staff and get that resolved.
    Mr. Serrano. Okay. And my understanding is that it was 120 
days after enactment the regulations were supposed to be in 
place, which would have brought it to about February 28th.
    Secretary Evans. Right. Right. Well, I am sorry we did not 
get that done and we should have if that was in the law, but we 
did not, unfortunately. But from what I am hearing now I guess 
I have a commitment from my team that we will have it in place 
by the end of May.
    Mr. Serrano. Well, I appreciate that.
    Secretary Evans. You bet.

                             digital divide

    Mr. Serrano. I appreciate that. Mr. Secretary, I am sure 
you are familiar with a report released by the Commerce 
Department a couple of years ago called ``Falling Through the 
Net''. And this report demonstrated that a digital divide 
exists in America. The report showed that the divide is still 
widening, especially for those communities that are already 
isolated or falling behind.
    For example, the report showed that 46 percent of white 
households then owned computers while only 25 percent of 
Hispanic households owned them. What is the Administration and 
the Commerce Department in particular doing to ensure that no 
American is denied access to the tools on which the new 
technology-based economy rides?
    In addition, your budget request provides only $15.5 
million for the Information Infrastructure Grant Program, also 
known as the Technology Opportunities Program, or TOP. This 
amount represents an almost two-thirds reduction below the 
current year funding level for this program, which supports 
innovative projects that help to address the digital divide. 
Why does the budget request not provide more resources to our 
achieving this goal?
    And let me tell you that there was a time in communities 
like mine in the South Bronx or across the river in Harlem 
where the issue of technology was left to the talk shows and 
the people dealt with the daily struggles of surviving and 
moving ahead.
    Now this is not true. Parents and local businesspeople and 
students are aware of the fact that this technology is out 
there. They have touched it, it has touched them. But they are 
also aware of the fact that they are being left behind.
    And there are a lot of things here in this society, Mr. 
Secretary, that you and I and the Chairman and any Members of 
this Committee play no role in having people left behind. But 
this one came on really during our watch in this society, in 
our time on this planet. And if we allow it to happen, then we 
will be the ones responsible.
    But you really can play a major role in making sure that it 
does not happen, and that is why I would like to see your views 
on it and hear your views.
    Secretary Evans. Sure. Congressman, the President has said 
many times over the last number of years that no child should 
be left behind. It disheartens me to see so many children in 
this country that cannot read. And I think it is vitally 
important that we remain focused on making sure that every 
child in this country has a good education and learns to read 
at grade level and stays on grade level throughout their school 
years.
    Another area that this country is concerning itself with is 
the Digital Divide, as you have described it. I would probably 
go to an area like Digital Empowerment or Digital Opportunity. 
I think it is very, very important that every child and every 
citizen has the opportunity to participate in this.
    The E-rate is an example of how government is playing a 
role in making sure that we are not leaving citizens behind. I 
think the E-rate raises some $2.3 billion a year, which is a 
substantial amount of capital to use in this effort. I know the 
Housing and Urban Development has a program that they have 
expanded this last year that deals with penetrating communities 
with technology. They have increased their budget from $40 to 
$60 million a year.
    I know that some of the research shows us that over the 
last several years, we are improving the penetration of 
technology into communities across America. I mentioned earlier 
in my comments on Spectrum--I did not say anything about the 
role Spectrum will play in making sure that this technology 
reaches not only those in the inner cities and the suburban 
areas but rural America as well.
    So there are a number of programs that are ongoing in 
government to try and deal with this issue.

                     technology opportunity program

    I am one that is a big proponent of public and private 
partnerships in dealing with this issue, and that is in part 
what TOP is, the Technology Opportunities Program. And it is 
the TOP Program, which was implemented a number of years ago 
and had a commitment of about $15 million in FY 2000. And then 
last year, the year we are in right now, they tripled that. 
They went from $15 million to $45 million.
    These are grants that are one-time grants. They are a 
specific program at a specific point in time, so it is not a 
grant that you are committing to fund over a series of years. 
It is a one-year, one-time grant. And the money has been used 
to also try and attract other money, try and find matching 
money, and from what I know has been a helpful program.
    But again, in going through a budget, you have to make 
tough choices. As we looked at the program and saw the dramatic 
increase, the tripling in a one-year period and understanding 
the other programs and initiatives that the government has 
underway, the E-rate program, the program in HUD, we felt like 
it was appropriate this year, for this request, to return back 
to its 2000 level, which was $15 million. Then take a hard look 
at it, see if there are ways to improve it and enhance it, and 
see what kind of results we are getting from it.
    So that is just one of those choices that we made when it 
came to priorities, we felt like taking it back to the level it 
was in 2000 was the right request to make.
    Mr. Serrano. Now you said that they were one-time grants. 
You did not say if you agreed with that or if you thought that 
the program should be changed.
    Secretary Evans. No, I said that because, if we had made 
grants that were kind of a three-year obligation, moral 
obligation, I might have viewed it differently. If we had made 
a grant to a community and said, this is a three-year 
commitment, but we have to go back to Congress to fund that 
commitment in year two, three and four, it would be a different 
kind of perspective for me than grants that are just one-time, 
one-year, no commitment to follow up. I will give you an 
example, the Advanced Technology program. We have scaled that 
back in this budget.
    But in that program, we have made commitments, moral 
commitments, that we would fund certain grants over a period of 
time as opposed to just one year.
    So when I looked at that, I looked for ways to make sure we 
honored what I considered was a moral obligation to continue 
funding those programs.
    Mr. Serrano. Well, that is not a difficult one for us to 
agree on. I agree in the notion of supporting a community or a 
group of folks over a period of time. But certainly if I can 
get you more excited about these kinds of programs by being an 
ally in getting them supported over a period of years rather 
than a one-time shot, then I, as we say in the South Bronx, I 
think we can do business. I feel we can come to some agreement.
    Let me ask you one further question here. As I am sure you 
will hear for a while, I represent a district in the Bronx, but 
by virtue of the fact that I was born in Puerto Rico and the 
lack of proper relationship that we have with the Commonwealth, 
in my opinion, in many ways I also represent the Commonwealth 
of Puerto Rico. And I speak for them--I speak about them in a 
lot of issues.

                         census and puerto rico

    Now the Census Bureau took a big step this year, partly as 
a request of this Committee, in including the population 
figures from Puerto Rico on the report that was handed down, 
the first report. Unfortunately, in my opinion, it was a total, 
and then Puerto Rico without a grand total.
    And I have a very simple theory on that. I think that 
notwithstanding the fact that the Constitution--and that is a 
very heavy notwithstanding--the Constitution said count the 
people throughout the States--I believe that is what it says--
that those folks who wrote that never envisioned having 
American citizens living outside the States. But American 
citizens do live outside the States. So I am wondering out loud 
when we take a census count, are we really taking a census 
count in certain areas, or are we counting all Americans or all 
residents? Because it is interesting.
    Listen to this. If you are a noncitizen--in fact, if you 
are undocumented--and I do not have any problems with that, as 
everyone knows--but if you are undocumented, you will get 
counted in New York in the regular count.
    Secretary Evans. Right.
    Mr. Serrano. But if you are an American citizen living in 
Guam, Samoa, the Virgin Islands, or Puerto Rico, you are not 
included in the regular count.
    Secretary Evans. Right.
    Mr. Serrano. I think--I do not know, I am not a 
Constitutional lawyer. I do not know that it would take a 
Constitutional amendment to add those American citizens to the 
regular count. So I would hope that as one of the million 
things that you pay attention to, that you pay attention to the 
next time maybe including all people who live under the 
American flag in the regular census count rather than in a 
separate census count.
    Having said that, on the American Community Survey. I 
understand from staff that while we were out voting, Mr. Miller 
asked some questions about it and you sounded very supportive 
of that work. The ACS also was supposed to include Puerto Rico. 
But now I understand that there are no plans to include Puerto 
Rico in the survey. And again, the Census Bureau, whether as an 
aside or as an integral part of the census, will be counting 
Puerto Rico next time. So why not include them in this program 
also?
    Secretary Evans. I guess we are saying it is a dollars-and-
cents issue. But we will be glad to look at it with you and 
your staff.
    This summer is the pilot study to determine if it is 
effective or not. If it is, then we will design a more 
comprehensive, kind of across America study. In the preliminary 
planning, I would assume that they probably had not thought 
about Puerto Rico.
    I do not know, if that is true or not. All I am saying is, 
I hear your concerns and we are glad to talk to you about it 
and see if there is a way to incorporate that in there.
    And I might also add that I share your same frustration and 
I agree with your logic. It confused me initially when they 
told me that we are going to count those here in America that 
may not be Americans, but yet those that are not in the 
country, we do not count.
    And this is an issue that has been talked about. And I know 
the Constitution reads ``residents.'' If you are a resident in 
the country.
    And it is an issue that has been discussed in this Congress 
I know over the years. There are some cases in the courts right 
now with respect to Utah and North Carolina with Americans that 
are outside the country and not being counted.
    Anyway, I think what Congress did do a number of years ago, 
was say we would count all the military officers----
    No? They have not done that?
    You want to respond to that, Bill?
    Mr. Barron. At the time of the 1990 Census, there was a 
considerable interest in Americans stationed overseas, and in 
responding to that, there was an agreement that the Census 
Bureau, in the 1990 Census, would count overseas stationed 
military as well as federal employees.
    That is another issue where we need to report back to 
Congress. I think it is by September 30, 2001, that we have 
been asked to do an assessment of what we can do in terms of 
counting all Americans overseas. It is a very difficult 
problem. I am not real optimistic about what we are going to 
do, but we will provide a report and sort that out with folks 
up here as soon as we can.
    Mr. Serrano. Well, Mr. Chairman, I am going to give up the 
mike for this round.
    But let me just say, I would make a request, Mr. Secretary, 
if you could have your legal minds get together and maybe look 
at the question and advise us----
    Secretary Evans. You bet.
    Mr. Serrano [continuing]. On the question of whether the 
Constitution says count people who live within the States, or 
whether it could be interpreted to say count all folks living 
under the American flag.
    Secretary Evans. You bet, Congressman. We will do that by 
September 30, 2001, as mentioned above, and we also would like 
to get with your Staff on the Cubaissue.
    Mr. Serrano. Sure. Thank you.
    Mr. Wolf. Mr. Latham.
    Mr. Latham. Thank you, Mr. Chairman.
    Secretary Evans. Good morning, Congressman.
    Mr. Latham. And welcome.
    Secretary Evans. Thank you, sir.
    Mr. Latham. And I know you will do a good job because you 
have Brenda Becker on your staff, so congratulations.
    Secretary Evans. She said she does not want to come up to 
the mike right now.
    Mr. Latham. Oh, okay.

                     Metropolitan Statistical Areas

    I have a question of you that I think several areas have 
problems with, and in Sioux City, Iowa, we are in what they 
call the Sioux Land, because it includes Sioux City, Iowa, 
South Sioux City, Nebraska, North Sioux City, South Dakota, and 
currently the metropolitan statistical area just includes South 
Sioux City, Nebraska, and Sioux City, Iowa, and does not 
include North Sioux City, South Dakota, or Union County, South 
Dakota, which includes the headquarters for IBP includes 
Gateway's home facility with 5,000, 6,000 employees and a new, 
huge housing development up there.
    And we have been trying for several years to try and get 
all of this included in the MSA, and I think we are making some 
progress but apparently there is a concern with other 
statistical areas which are going to take more time and more 
information to establish, that all of the designations are 
going to be held up probably until the year 2003, which is 
extremely unfortunate for that region as far, as you know, the 
basis for the economy and what they can talk about bringing in 
business and also for federal grants and those type of 
programs.
    I just wondered, and maybe we need to refer this, I would 
like to visit with you sometime or your staff, on what we can 
do to expedite that, but it is a huge issue for us, and very 
important.
    Secretary Evans. I would like to learn more about it. I am 
aware of the problem and the issue. I have been informed that 
we will not be providing the data that OMB needs until March of 
2002, and then I do not know how long they need with the data 
to massage it and maybe that gets you out to 2003.
    And so I have asked our staff to look at that, to see if 
there is a way to compress the time line by which we can submit 
the data to OMB, which is the body that will set the SMSA.
    Mr. Latham. Right.
    Secretary Evans. So we will work with your staff on that, 
and we will get back to you to give you a hard answer of yes, 
we think we can speed it up, or, unfortunately, it is 
impossible.
    Mr. Latham. The biggest concern is that you cannot do the 
MSAs until all of the areas are designated and different 
criteria goes with those. And apparently the information they 
have, everyone knows that it will be included, but it is just a 
matter of being able to get it done.
    And it is a huge issue and of course, I have got about 80 
people from Sioux Land coming out here Monday; they want to 
hear about this issue.
    Secretary Evans. Sure. We will try--we will get back to you 
this week on that, so certainly you will be prepared for them 
with at least the best information we have at that point in 
time.
    [The information follows:]


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    Mr. Latham. Right. And we would invite you to come over and 
visit with them first.
    Secretary Evans. Sure.

                               Free Trade

    Mr. Latham. Okay. I have, obviously from Iowa the trade 
issues are extremely important, and I would just like to hear 
what kind of priority and what your outlook is for the fast 
track authority for the President.
    We are, as I think most people are aware, that there are 
trade agreements going on all over the world today, where we 
are not even at the table because the President does not have 
that authority, and so we would like to expedite that as soon 
as possible.
    I just wonder what you first see happening, and what kind 
of priority this is with the Administration.
    Secretary Evans. It is certainly the highest priority. The 
President has talked frequently, over the last several years, 
about the importance of free and fair trade. It is an issue 
that will get, great attention from us in the months ahead.
    I think, what I would say to you is that I am, heartened by 
the progress on a number of fronts. One example of the progress 
was having been in Argentina and Quebec City and talking to the 
leaders of the Western Hemisphere, and hearing their desire to 
move forward with FTAA or bilateral trade agreements.
    There are a number of countries within the Western 
Hemisphere. Obviously, we have on-going discussions with Chile. 
We hope that we will have an agreement up here before the end 
of the year.
    We have on-going discussions with the Andean countries in 
South America. We have on-going discussions with Jordan, 
Vietnam, Singapore. Obviously, we are also getting ourselves 
ready for WTO.
    I think, in terms of Trade Promotion Authority, I have 
total understanding of the importance of communication with 
Congress and trust between the Executive Branch and Congress, 
consultation with Congress, and listening to Congress as to 
their concerns, and issues.
    And so that is what I am in the process of doing,beginning, 
along with Ambassador Zelleck, to spend a lot of time talking to 
members of Congress, trying to push trade promotion authority along.
    I am one that remains optimistic that we will have Trade 
Promotion Authority before the end of the year, but I 
understand there are a lot of issues still to be dealt with. 
There has got to be a trust relationship with Congress.
    And not only that, we have to pay close attention to the 
concerns of Congress and specifically in the areas of labor and 
environment. I mean, we have to understand how those issues are 
going to be dealt with.
    So, anyway, I know there is a lot of work to do, but I also 
do not underestimate the task of Trade Promotion Authority 
being passed by Congress. Though I am optimistic it will 
happen, I also think it is a very important tool for the 
President to have as we continue to open up this world to trade 
and make sure that America continues to be a player at the 
table.
    Mr. Latham. Thank you for that answer, and I hope that we 
can proceed quickly on that.

                            Trade Sanctions

    Just one last thing. I would really like to associate 
myself with some of the comments that Mr. Serrano made about 
trade and the ability for us to look at some of these sanctions 
that we have in place. From my understanding of the last counts 
that I have seen, in the last eight years, we have had about 
120 trade sanctions, and over half of those have been in the 
last eight years.
    And it really has an effect, and I am speaking from Iowa's 
point of view obviously, but our situation there when you have 
about 40 percent of the world under some type of sanction, even 
if there is an exclusion for food and medicine, it certainly 
does have an effect on our abilities to sell our products 
overseas.
    And we always have to respect obviously the human rights 
and those aspects of it, but in fact I do not think cutting off 
the opportunity for people to get food from the United States 
is a way of encouraging democracy or freedom around the world 
either.
    So I would be very, I would hope you would be very close in 
your scrutiny of any suggested sanctions.
    Secretary Evans. Indeed we will. Thank you, Congressman.
    Mr. Wolf. Mr. Kennedy.
    Mr. Kennedy. Thank you, Mr. Chairman.
    I would like to begin with the free trade issue since we 
have been talking so much about it. I just want to add my 
experience.
    I have been down to South America and I have found that 
they did not want a wholesale free trade agreement anymore than 
those of us who opposed it in Congress for the same reasons; 
they were concerned about their own labor situation, their own 
environmental situation.
    And they said, well, it is often perceived that our 
countries would benefit a lot from free trade, those in South 
America, would like to see a free trade agreement. They are 
faced with the same political pressures that we are faced with 
domestically.
    They have to make sure their workers are treated fairly, 
and their environment is protected. And they find that because 
they are in small countries, that their chambers of commerce 
really run roughshod over them.
    I mean, we know here in this Congress in this country, how 
much the Chamber of Commerce really dominates over labor/
environmental groups.
    So you can imagine if it does this in this country, what it 
is like--it is not even a contest--down in those Latin American 
countries where you have these multi-national companies that 
come in and basically, with fewer dollars than they can dictate 
the laws here, really dictate what the laws are down there.
    And of course, it is in their own self interest and their 
corporate responsibility to dictate them in the way that would 
be most favorable to their stockholders.
    So leave no impression that they are about to do it because 
they want to try to make those countries better places to live. 
So I would just leave that for you. That is my experience.
    I have been to the Maquiladoras across from Mexico. These 
places, like The New York Times article a couple weeks ago 
illustrated, are still paying pennies on the dollar what we pay 
and these workers are still subjected to intolerable 
situations.
    And I might add, those employers have the same rights to 
our marketplace as our domestic producers and yet they do not 
have to adhere to any of the same rules and regulations because 
they are over the border in another country. Hence, we, our 
domestic manufacturers are put at an enormous disadvantage 
because while we have to comply with labor laws, child labor 
laws, environmental standards, they do not have to.
    And what kind of fair trade is that? And if you go there, 
and I encourage you to go there, and I am sure you have, it 
will break your heart because there is not a home in that whole 
Maquiladoras section that has a floor on it. They are all mud, 
and every single roof is a thatched roof, and it is leaking, 
and there is a whole family of six living in a room that we 
would not consider big enough to have as a lavatory.
    So, I mean, global trade offers possibilities but only if 
we have the proper mechanisms, like allowing workers to 
organize, that will provide a flexible balance in the offset of 
power because this is all about power. Who has the power.
    And unless labor has power, guess what? You are not going 
to give any impetus for advancement of workers' rights. And I 
think that is simplistic but I think that it is borne out of 
experience, and anybody who has witnessed how life works, it is 
all based upon who has got the power.
    In that regard, if we do go forward with the President's 
initiative on free trade, I hope that the President is sincere 
about making sure we have safe protections for workers and the 
environment.

                      Trade Adjustment Assistance

    I would say there is another protection that we need if we 
do go forward with free trade, and that is having TAA, the 
Trade Adjustment Assistance, supported.
    Now I know in the current budget it is flat-funded. For 
those businesses that are expected to move into a global 
economy and work through the transition that an ultimate free 
trade agreement would bring to our local businesses, I would 
encourage you, as Secretary of Commerce, to support Trade 
Adjustment Assistance. I know there are many companies like 
Colonial Knife and B&L Plastics in Rhode Island, that have 
benefitted tremendouslyfrom that.
    And it has basically allowed us to save money from 
unemployment insurance and a whole host of other programs so it 
is smart money spent. I would just encourage you to do that.

                    INTERNATIONAL TRADE DATA NETWORK

    And also I want to just add, in terms of helping us get 
into global trade, that while we can open up markets, and also 
open up existing markets that are already available, many small 
businesses, as you know, do not even gain access to them 
because they do not have the backing that the big businesses 
have. And that is why I wanted to make you aware of the 
International Trade Data Network.
    This is a computer system. It helps in the small business 
export assistance centers, helps our small businesses get on-
line and figure out where the product that they make can be 
sold all around the world within existing markets.
    And I would only emphasize that if the President really 
wants to make free trade one of his marks, in terms of 
developing our economy, he should not neglect that there are 
current markets already available that our current producers 
and manufacturers can export to if they only had the facility 
to export to.
    And, as you know, so many small businesses do not have that 
backing that will help them find their markets overseas. I 
encourage you to make sure this is a part of whatever free 
trade agreement you work on because you have to take advantage 
more of existing trade as much as you have to expand trade 
overall.
    And I want to add that that has worked very well in my 
state for our small businesses and would commend it. And I will 
get you some more information and certainly invite you up to 
Rhode Island to see how well it works in our state.

                             NOAA PROGRAMS

    Finally, I just wanted to go through a couple things within 
NOAA. I know it is 60 some percent of your budget, it is a big 
part and it is important.
    For my region of the country, the Sea Grant Program is 
vital. And I would encourage you to continue to support the Sea 
Grant Program in the future, which I know you do in this 
budget.
    And also I would encourage the implementation of the 
Coastal Ocean Observing System, which will provide coastal 
managers, recreation and commercial fishermen, and shipping 
interests, as well as Coast Guard and recreational boaters, and 
offshore oil companies, and many other users more understanding 
of the ever changing ocean environment and how to manage within 
the ocean ecosystem. And so that Coastal Ocean Observing System 
is something I would also like to commend.
    And in that regard of ocean issues, National Marine 
Fisheries Service is very important. This is obviously a 
contentious issue all around the country, as you know, and you 
will find out very shortly as Secretary of Commerce, when it 
comes to deciding what the livelihood of these fishermen will 
be in terms of what they can fish. We really need your personal 
involvement whenever those issues come up because people often 
feel like it is some bureaucrat who does not understand the 
local situation.
    And that is where political involvement makes a difference 
in just helping to make the message clear and understandable to 
those whose both short-term interests and long-term interests 
will be served by a proper management of the fisheries.

      SMALL BUSINESS ADMINISTRATION/MINORITY BUSINESS DEVELOPMENT

    And let me say finally, I wanted to just ask, and this is 
finally my question, what you are planning to do to work with 
the SBA in regards to the Minority Business Development Agency, 
which does a lot of work to help small, minority owned 
businesses?
    Unfortunately, as I have learned in my state, SBA and 
Department of Commerce do not always work as well as they could 
otherwise. And I would just make a note to your staff, if you 
can work on that because of course, as you know, minorities and 
women-owned businesses are growing dramatically, as they 
should. We have the SBA, and we also have the Minority Business 
Development Agency. They need to work in concert with one 
another to be more effective, and I would encourage your effort 
in that regard.

                        NATIVE AMERICAN PROGRAMS

    The Department of Commerce is critically important in these 
lower income areas, and I wanted to just commend you, from 
reading your bio, about what you have done with Native 
Americans.
    I am the cofounder of the Native American Caucus, and when 
it comes to these under served areas and economically depressed 
areas, things like the Minority Business Development Agency, 
SBA, and EDA are critical.
    The work that EDA does on the Reservations is critical, 
particularly those most impoverished ones. We know three of the 
five poorest counties in this country are Native American 
Reservations. Most of America does not know that, aside from 
the well-known examples of prosperity on Native American 
Reservations that come from gaming, most Tribes still are in 
desperate situations.
    And, as you know, Mr. Secretary, from working with them and 
your own philanthropic efforts through Natavision, a lot of 
these Tribes cannot take advantage of bonding authority because 
they do not have the same governmental authority for economic 
development.
    That is why EDA provides an important component to their 
economic development. And I would only encourage you to try to 
make sure EDA money goes to those Tribes that need it most, and 
that we give those Tribes more tools to borrow and make those 
plans for their own benefits.
    So, I wanted to max out on my available time by giving you 
all my thoughts on every issue practically that comes before 
you.
    But you can comment or just say ah ha, whatever you prefer 
to do.
    Secretary Evans. I would like to comment. Can I comment?
    Mr. Wolf. Absolutely. We have no five-minute rule, so you 
can take as much time as you want.

                               FREE TRADE

    Secretary Evans. Okay. Yeah, I would like to respond to 
more than just your question.
    On trade, I just want to share with you that at the Summit 
of the Americas in Quebec City where there were 34 elected 
leaders of democratic countries in this hemisphere, the thing 
that I was most moved about, one, was being there with 34 
democratically-elected leaders in this hemisphere. It was just 
certainly very moving.
    And then to look at the size of these countries and look at 
the poverty in these countries, to look at the per capita 
income in these countries, and then listen to these leaders say 
that their best hope for bringing their countries out of this 
poverty was through free trade.
    When I looked at some of these smaller countries, first 
looked at America, and looked at the wealth of America, and 
looked at the per capita income of America, and then went down 
into the smaller countries and found, not $29,000 per capita 
income or gross domestic product, but found $1,200, found $700, 
found $500 per capita income in a country, and their democratic 
leader is saying that, look, our best hope to get our country 
out of poverty and put floors in our homes is through trade.
    I share your view wholeheartedly, in terms of a level 
playing field being very important. I mean we all ought to play 
by the same rules. It is not going to happen overnight. It is 
not realistic to think it will happen overnight.
    But capital will continue to flow where there is a friendly 
kind of environment where it can get a rate of return that is 
acceptable.
    But having said that, we still have to all play by the same 
rules. And if I am an American worker, which I have been, I 
have worked in a steel mill before, I worked on a drilling rig, 
I know that if I was working on the steel mill floor in this 
country, and I thought that somebody in some other country was 
getting a better deal than I was, I would not like it.
    And so I think it is very important to stay with the 
consistent principle of making sure there is a level playing 
field. But when I saw the hearts and souls of these leaders 
throughout the Western Hemisphere say that the best hope for 
bringing their country out of poverty, and improving the 
quality of life in every kind of way, not just in a material 
kind of way, in every kind of way, the best hope was through 
trade, that moved me.

                            SMALL BUSINESSES

    Your comment about small businesses, I could not agree with 
you more. I do not know if we have got the secret weapon of all 
secret weapons in government but I have to tell you, the 
Foreign Commercial Services has a terrific team of people.
    Now are we really utilizing this team of people to its 
fullest extent? I am not sure we are. I must admit to you that 
it discourages me that you think you have got a better system 
in your state, in terms of alerting your small businesses where 
markets are, than what we have.
    I mean, that is what we do. That is what Foreign Commercial 
Service does. It helps small businesses, medium-sized 
businesses find markets, existing markets that are already 
there. It just makes sure that the small business is aware that 
they are there, and then opens the door for them.
    So, if there are better systems out there in this country 
facilitating that, then we ought to know about it and we ought 
to be participating in it.
    I just got back from California. I saw our Foreign 
Commercial Service Officers from the Asian Pacific region and 
the enthusiasm they had, the excitement they had for markets 
that were opening up in that area, that was inspiring to me.
    What I want to know is that, they are getting the job done 
and the small business community is aware that they are there, 
how to access them, and how to utilize that very important 
resource that is available to small business.
    I hope that I make very few speeches while I am here that 
do not mention small business. I hope most of my speeches 
mention it.
    When you look at this economy and the strength of this 
economy, it is found in the small businesses, period. I mean 
all the data supports that, that is not complicated.
    I once ran a small business and so I think it is very, very 
important to stay focused on small business in America. I want 
them to know, as we are moving through globalization, that they 
can participate in that, they should be participating in that.
    The Commerce Department has got the Foreign Commercial 
Service. That is what they do. We have offices all over 
America, all around the world, and their responsibility, their 
mission, is to find markets for small businesses. So if there 
are ways to improve it, we want to improve it.
    When it comes to minority business development, we are 
talking to, cooperating with, and working with the SBA.
    I was presented with a program yesterday. I believe we are 
having a national conference in September, that we are going to 
hold in conjunction with the SBA.

                  MINORITY BUSINESS DEVELOPMENT AGENCY

    I hope you are there. I hope you come speak there. I am 
excited about it. I think that I am certainly enthused about 
the leadership that we have now in the Minority Business 
Development Agency.
    I am a little bit confused as to why the budget has been 
cut so dramatically over the last 20 years. We have taken what 
was a $100 million budget, and turned it into a $28 million 
budget.
    You take, inflation eating away at that. I mean, though I 
am not sure it is because we were not delivering, or whether we 
lost our mission--I am not sure what we did. Let me say it this 
way. I think it is very important that the minority community 
participate in the American Dream, participate in capitalism, 
participate in the free enterprise system, and I think that we 
ought to have ways of helping them participate, and understand 
how to participate.
    And you know, that is all part of what Minority Business 
Development's supposed to be doing. That is an area where we 
increased our budget request this year, we increased it 
$750,000 to expand a Phoenix Database system in place that 
helps match minority businesses with opportunities that are 
available in the marketplace.
    I hope that this matching system will improve the 
participation of minority businesses.
    So anyway, we are in agreement, and yes, the Native 
Americans have been a big part of my life.
    I have spent a lot of time on the Reservations. I have seen 
the poverty, I felt the poverty, I have been active, as you 
have, trying to do things to make their life better, improve 
their quality of life, and I will continue to do that. EDA does 
have some very useful programs that have served some of the 
Native American Reservations, and they will continue to do 
that.
    Mr. Kennedy. I look forward to working with you on that, 
and maybe traveling with you at some point to some of our 
Reservations and talk about how the Commerce Department can be 
more helpful, and how it is being helpful to Native American 
communities that need the help.
    Secretary Evans. Good. Thank you, Congressman.
    Mr. Kennedy. Thank you.
    Mr. Wolf. Mr. Vitter.
    Mr. Vitter. Thank you, Mr. Chairman, Mr. Secretary, and 
thanks for being here.
    Secretary Evans. You bet, Congressman.

                           Nautical Charting

    Mr. Vitter. I am from southeast Louisiana, so I represent a 
coastal area and also an area that is a maritime center.
    For both of those reasons, NOAA is extremely important to 
all sorts of folks in my neck of the woods. I am very concerned 
that, because of inadequate nautical-chart surveys and 
electronic charts and increasing draft of vessels, we are going 
to have another Exxon-Valdez-like incident in the next ten 
years.
    I am very concerned that we are just not anywhere near a 
pace to improve our nautical charts the way we need to.
    Right now NOAA is focused on what it calls the most 
critical areas. That is 1.3 percent of all the areas it needs 
to chart, the most critical areas, and at our current pace that 
will take 20 years.
    So 20 years to do 1.3 percent, admittedly the most 
critical, but there are other important areas that are even 
beyond that timeframe in the remaining 98.7 percent of 
necessary areas to chart.
    I want to suggest two ideas to you rather than just more 
money, which is an easy answer but we all have budget 
constraints which I certainly support the notion of reasonable 
budget constraints, but I think we can use whatever money we 
have more effectively with new business models:
    Number one, more private contractor surveys; and,
    Number two, long-term time charters with contractor-owned 
and -operated survey ships.
    So I want to specifically suggest those two newer, more 
innovative business models for NOAA. I think they can help do a 
lot of things: Eliminate capital costs for NOAA when you are 
talking about ships; effect great cost savings over the 
lifetime of a charter in terms of a vessel that is doing the 
charting; offer fleet modernization; expand survey capability 
to a full 360 days; and free NOAA hydrographers to focus on 
their core responsibilities.
    I guess my question is if you have any particular reaction 
or comment to those two specific ideas:
    Number one, more private-contractor surveys.
    And number two, long-term time-charters with contractor-
owned and -operated survey ships.

                          Mapping and Charting

    Secretary Evans. Congressman, I know it is a serious issue 
that we are focused on from what I am understanding. You are 
right. Our maps are old. They need to be updated.
    I know that we, in our budget this year, have allocated 
$107 million for navigation-related issues.
    I know that we have asked for a $13 million increase in the 
marine transportation area to deal more specifically with this 
issue that you are talking about in terms of updating our 
mapping.
    I also know that we have got $20 million in the budget to 
work with private contractors to get them to facilitate this 
problem that we have, or issue that we have, in terms of 
getting these maps updated and current.
    In terms of working with long-term contractors, I am not 
familiar with that at all but I will sure take a hard look at 
it.
    I know this is an interest and should be a great interest 
of yours, because it is important to many of your constituents, 
which I clearly understand having spent a fair amount of my 
time on the Gulf Coast and in the waters down there.
    So what I would like to do is just to make sure that our 
staff is talking to your staff and you are comfortable with the 
plan that we have in place to get the maps current and updated.
    I have not heard the percentages that you have mentioned in 
terms of, we are only doing 1.3 percent and it is going to take 
a long time to get it all done. If we are talking years and 
years to get this accomplished that is something that I would 
like to know about.
    So I am not familiar with that, either. But, let's say that 
I read your concerns loud and clear. They are ours.
    I know that our staff and team is focused on it.
    We tried to provide some additional funding, including the 
$13 million increase in the budget to focus on this specific 
issue, this specific concern. And so is that enough money to 
get the job done in an adequate way? I am not sure.
    But what I think we ought to do is have our team talking to 
your staff, and I want to see that you are comfortable with 
that, and, if you are not, I want to know why.
    Mr. Vitter. We will certainly follow up with your office.
    But just to briefly reiterate, the dollar figure is one 
thing. And in the perfect world, you know, my dollar figure 
would be more and I would take it from other parts of the 
budget, and even have the same overall budget number.
    And maybe we can try to do some of that through this 
Subcommittee. But apart from the dollar figure, I think there 
is a separate issue of how we spend the money.
    I honestly think, as in all parts of the federal 
government, that there is a lot of fiefdom protection and there 
are very innovative ways to spend the money more effectively 
that the bureaucracy is tilted against.
    Secretary Evans. Yes.
    Mr. Vitter. And private contractor surveys is one of those 
ways you do some of that. I think we do not do enough of that.
    Secretary Evans. Yes.
    Mr. Vitter. And an even more cutting-edge idea, which I do 
not think you do any of that I think we really need to look at, 
is this long-term time-charter, where you do not just build 
government ships and have to maintain a fleet and that is 
complicated, and that is costly.
    Secretary Evans. Right.
    Mr. Vitter. A contractor builds, owns, operates the ship--
--
    Secretary Evans. Right.
    Mr. Vitter [continuing]. And does your mission with a 
mixture of your personnel and other folks, whatever is 
appropriate.
    And in other areas, including scientific research, that has 
proved extremely efficient compared to the old model of the 
government having to own the fleet, and I really encourage you 
to look at that new business model, and we will follow up----
    Secretary Evans. Good.
    Mr. Vitter [continuing]. At the staff level.

                   Appointment of NOAA Administrator

    This is a final question related to NOAA also. I believe 
the NOAA Administrator has not been appointed yet. Is that 
right?
    Secretary Evans. That is correct.
    Mr. Vitter. Okay. I know in the past those folks have 
tended to come from academic and research backgrounds.
    In my opinion, that has created somewhat of a bias toward 
research work versus the day-in/day-out sort of nautical 
charting I am talking about.
    Secretary Evans. Yes.
    Mr. Vitter. I want to suggest to you that that is an 
inappropriate bias; that, as boring as the nautical charting 
may be, it is awfully important to the maritime industry.
    We are way behind the curve in our current pace, as I laid 
out to you. And I think you can ask your staff and they will 
verify that the figures are slow to even chart the critical 
areas, which is less than two percent of all the areas to be 
charted.
    So I hope as a NOAA Administrator is appointed, and as that 
person comes on board, more focus can be given to this boring 
but necessary mission of NOAA that is absolutely crucial to 
coastal areas and the maritime industry.
    Secretary Evans. Thank you, Congressman.
    The only other comment I think I would like to make is that 
I think this is an area that requires a lot more attention, 
maybe, than it has been given in the past.
    I am heartened that there is the Ocean Policy Commission 
that the President will soon announce that will report to the 
President in the fall of 2002 and really bring some focus as to 
the oceans and the issues related to the oceans, including the 
issues that you have raised here this morning.
    So, anyway, I take your thoughts very seriously. I will 
make sure that we follow up, and we will have another 
discussion about this in the not-too-distant future.
    Mr. Vitter. Thank you.
    Secretary Evans. Thank you.
    Mr. Wolf. Ms. Roybal-Allard.
    Ms. Roybal-Allard. Thank you, Mr. Chairman. Just by way of 
comment on the side, I was very pleased, Mr. Secretary, to hear 
your recognition of the importance of small business and 
minority and women-owned businesses in this country.
    Perhaps you can use your influence to dissuade the 
Administration's proposal of a 43-percent cut to the Small 
Business Administration and also some of the fees that they are 
proposing to charge for some of the services that the SBA now 
is offering.

                Technology Opportunities PRogram (TOPS)

    By way of clarification, I would like to go back to the 
question that was asked by Mr. Serrano with regards to the TOP 
Program, because I too was very concerned by the severe cuts to 
this program, especially in light of the fact that many 
community-based public and nonprofit organizations who serve 
underserved communities are going to be impacted.
    Was it my understanding that the reason that you have 
proposed these cuts is because through your research you see 
that there is going to be no impact in terms of these 
community-based organizations to meet, or to close that Digital 
Divide? That it is going to be filled?
    Secretary Evans. No, ma'am. I do not believe I said that. I 
hope I did not. If I did, I misspoke.
    Again, going through the budgeting process, it is 
priorities. And as I said at the outset, I think there is 
nothing more important than focusing on the core mission of our 
agencies and of our bureaus.
    You know, when I look at all of the needs of Commerce and I 
consider the resources that we have available to take care of 
those needs, you have to make some tough choices along the way.
    When I looked at TOP, obviously I was looking at this back 
several months ago, I saw a program that had been funded at a 
level of about $15 million a year. And then in one year it was 
increased by three times and it was moved to $45 million.
    I thought it was appropriate to roll that program back, 
reduce it back to where it had been funded in 2000, take a hard 
look at it, see what kind of performance we had, see what kind 
of results we had.
    I know there are lots of other programs throughout 
government that are dealing with digital empowerment, digital 
opportunity, Digital Divide, however you want to describe it. I 
mean, you can take the E-Rate program, and that raises $2.4 
billion a year.
    And then you take a program that is in HUD that is another 
$60 million program.
    So I think it is just important to make sure the results 
are there, the performance is there. I often have trouble when 
I see programs triple in one year. I am not sure you can manage 
that kind of growth in one year effectively.
    So, I felt like let's take a good, hard look at it this 
year, see what the performance has been, see what the results 
are, and then again just look at it against all the priorities 
that we have at Commerce.
    Ms. Roybal-Allard. I guess the concern is, if I am 
understanding you correctly, is that there may in fact be a 
need there but the cuts are being made without fully 
understanding whether or not there is the need.
    And so you make the cut. You find that there is a need, but 
in the meantime these organizations and nonprofits and 
community-based organizations are going to be obviously 
disadvantaged if the resources are not there for them in order 
to catch up.
    Am I understanding you correctly that a decision was made--
--
    Secretary Evans. Well, I think maybe it is a slightly 
larger picture. I think that what I am trying to say to you is 
that we have lots of very, very important needs in this 
country.
    One of the most important needs is making sure every child 
can read. As you have heard the President mention many times, 
we do not want to leave any child behind in this country. It 
starts with making sure every child can read and funding that 
at a level and taking the steps there that you need to take to 
make sure every child can read.
    So you go through the needs of this country and the 
priorities in this country, and then you look at the resources 
that you have to fund those priorities.
    As I look through the Department of Commerce and try to 
weigh the funds we had available in the Department of Commerce, 
as well as the needs that we had, and trying to prioritize 
those needs, I felt like it was appropriate to consider again 
reducing the program to its 2000 level. I have looked at some 
of the larger programs we have in government like the E-Rate 
Program which is raising $2.4 billion a year.
    I mean, it would dwarf, obviously, a TOP Program. HUD has 
got the Community Technology Center, which is doing the same 
type of thing, trying to get technology out into the 
communities across America.
    And then, yes, in Commerce, we had this TOP Program. So I 
said let's take it back to the approximate level it had been 
funded for four or five years in a row and look at it 
diligently and thoroughly and see what kind of results we are 
receiving fromthis, and then make a determination in 2003 
whether or not we ought to consider increasing it then.
    So, Congresswoman, it is just a matter of, the tough 
choices that you have to make.
    Ms. Roybal-Allard. I understand that. And when you have 
tough choices, there are winners and losers.
    My concern is that among the losers may be these community-
based organizations and nonprofits that are going to be put at 
even a greater disadvantage than they have been in the past.
    Secretary Evans. Excuse me, if I might say, the other point 
I would try to make, too, is that I want to make sure we are 
doing everything we can in engaging the private sector in this.
    Now there was some effort, and I have not looked at it in 
great detail yet, but there was effort for these grants to be 
matching grants, that the private sector should be playing a 
very, very large role in this.
    It is in their interest to play a large role in this, not 
only because it is the right thing to do from a corporate-
responsibility standpoint, but it is the right thing to do to 
make sure that this society is going to have the kind of 
workforce that it needs in the years ahead to run these 
companies and to work in these companies.
    So, as I look at it again that will be a big focus of mine 
to make sure that the private sector is very engaged in this 
program and I am not sure that had been done adequately, but I 
am going to look at that hard.

              PUBLIC TELECOMMUNICATIONS FACILITIES FUNDING

    Ms. Roybal-Allard. Yesterday I met with the Chairman of the 
Corporation for Public Broadcasting.
    We discussed the fact that many of the small public 
broadcasting stations are very concerned about their ability to 
meet the 2003 deadline for converting to digital.
    One of the things that I was pleased about was that you 
have at least provided, essentially, sustained funding for the 
public telecommunications facilities program.
    Could you tell me what your estimate is of the total needs 
to convert these stations to digital and where will these 
additional funds come from?
    Secretary Evans. Well I do not know what the total needs 
are. I know we are way behind schedule. I know that in 2000 the 
requests were for $98 million in funding and we received $14 
million.
    I know that in 2001 again the requests were some $93 
million and I think we had some $30 million to spend.
    In the budget this year we are requesting $43.5 million, I 
believe. And so just in terms of funding this will be the 
largest funding request for this ongoing conversion, but the 
total number I am not sure of.
    Barbara, do you know the number?
    Ms. Retzlaff. No.
    Secretary Evans. I do not know the total number that is 
really left to make this full conversion. I know that we are 
behind schedule by a significant amount but I also know that 
the requests were significantly underfunded in the year 2000 
and again in the year 2001.
    So, if the money is not there to make the conversion, then 
it is not going to happen.
    Ms. Roybal-Allard. So are you anticipating, then, that the 
deadlines will not be met?
    Secretary Evans. I am anticipating that the deadlines will 
not be met.
    I think that is what I am anticipating. I do not even know 
exactly what the deadline is--2003.
    So, I do not see how we can meet it with the funding that 
has been provided over the past couple of years.
    Then, again, we have asked for a pretty substantial 
increase, but I think it is going to be very difficult to meet 
the deadline.
    [The following clarifying statement was subsequently 
submitted:]

    The Office of Management and Budget has estimated that over 
$700 million is needed for the nation's approximately 350 
public television stations to meet the FCC's minimum digital 
broadcast requirements. The Corporation for Public Broadcasting 
has estimated the total need at $1.8 billion. This estimate 
includes the transition of radio to digital broadcasting and 
operating and production costs.
    The amount requested in the President's 2002 Budget is 
equal to the largest appropriations the program has received, 
which was $43.5 million for this fiscal year, prior to a 
rescission of $96,000. The 2002 request holds this figure 
steady. For 2001, the President's Budget requested $110 million 
dollars for public broadcasting's digital conversion.
    Congress appropriated $26.5 million for the PTFP in 2000. 
The program received applications for $98 million for digital 
conversion. NTIA could only award $14.4 million of those 
requests. The remainder of the funds were awarded for equipment 
replacement projects and for distance learning and public 
telecommunications services for the disabled.
    NTIA has received $95 million in digital conversion 
requests for FY 2001.
    The Federal Government has not committed to fully funding 
the conversion of public television. The Clinton Administration 
proposed a plan that, would have assisted each public 
television station in meeting the 2003 deadline. However, since 
1999 the initiative has not been fully funded.

    Ms. Roybal-Allard. Could you explain to me what does that 
mean then, that those that do not meet the deadline will lose 
their license?
    Or, is something going to be proposed? Is it possible to 
extend the deadline?
    Secretary Evans. Yes, Congresswoman, I am not sure, but I 
will be glad to have my staff work with you and I will get back 
to you personally to make sure you are satisfied with our 
answer or at least you understand our answer. I am not sure of 
the details of the deadline date, and what the impact would be 
if you do not meet it by that deadline.
    I cannot believe somebody would lose their license because 
we did not provide the funding that we had said we would 
provide.
    But, anyway, we will get back to you. We will be glad to 
visit with you about that issue.
    Ms. Roybal-Allard. I appreciate that.
    Secretary Evans. You bet.
    [The following clarifying statement was subsequently 
submitted:]

    The Commission has granted numerous extensions for good 
cause to commercial stations that have been unable to meet the 
deadlines in the top 30 markets that have been passed so far. 
The same option of an extension would be available to a public 
broadcaster unable to meet the 2003 construction deadline. The 
Department continues to work through NTIA's Public 
Telecommunications Facilities Program to enable as many public 
stations as possible to convert to digital television in a 
timely manner.

                    EDUCATIONAL PARTNERSHIP PROGRAM

    Ms. Roybal-Allard. Last year, the Committee provided $15 
million for the Educational Partnership Program with minority-
serving institutions.
    I was pleased that you have again included funding for the 
program in your budget request. And I understand that currently 
you have issued Requests for Proposals.
    Can you tell me what your timetable is for getting these 
funds out and getting these partnerships running?
    Secretary Evans. I am not sure what the timing is. I know 
it has been a great program. I know it has been met with 
tremendous success.
    We are going to try and have selections by the end of this 
year.
    Okay, we are going to try and get them awarded in 
September, and the money would go out with the award, if not 
earlier.
    The money will go out by the end of September.
    Ms. Roybal-Allard. Okay. In your 2002 request, is it to 
provide additional funding for the partnerships that qualify 
for the 2001 money? Or is your intention to identify 
additional----
    Secretary Evans. It is additional, is it not?
    Ms. Roybal-Allard [continuing]. Institutions?
    Secretary Evans. Yes, go ahead. Scott is very familiar with 
the program.
    Ms. Roybal-Allard. Sure.
    Secretary Evans. Come here and use the mike.
    Mr. Gudes. I'm Scott Gudes from NOAA. Under the minority-
serving institution program, the $15 million in FY 2002 will 
continue the four Institutes of Excellence.
    There is a program we have called Environmental 
Entrepreneurship, which is about $3 plus million.
    That will be looking at a number of proposals from 
minority-serving institutions around the country--Hispanic-
serving institutions, historically black colleges and 
universities, Native American tribal colleges.
    That will be an ongoing program. They will look at 
different projects to fund.
    But the four basic science institutes--Environmental 
Science, Marine Science, Atmospheric Science, Remote Sensing--
will be selected this year and then be continued at about $2.5 
million apiece.
    Ms. Roybal-Allard. Okay, thank you.
    Mr. Chairman, do I still have time for another question?
    Mr. Wolf. Yes.

              LATIN AMERICAN E-BUSINESS FELLOWSHIP PROGRAM

    Ms. Roybal-Allard. I received a copy of the correspondence 
that was provided, because I am a member of this Subcommittee, 
that outlines your plans in the International Trade 
Administration to implement a Latin American E-Business 
Fellowship Program.
    Could you describe for this Committee those efforts and 
what you are hoping to accomplish through this?
    Secretary Evans. Sure, you bet. It is all part of improving 
education throughout the western hemisphere, trying to share 
our knowledge, our experience with our friends and neighbors 
throughout the western hemisphere.
    Specifically, this is a program where we would invite 
individuals throughout the western hemisphere to come to 
America, spend a couple of days here in Washington, D.C. in the 
Department of Commerce, where we would give them an orientation 
as to e-business practices in America and how e-business works 
in America.
    Then we have worked with, again, kind of my bias, I think, 
toward making sure we are engaging the private sector. We have 
a number of corporations throughout America. They are excited 
about bringing these individuals into their companies, into 
their back rooms, into their rooms where e-business actually 
happens, and spend four or five weeks there in those companies 
to kind of learn the value of this technology and how it can 
help improve productivity in their own small business or large 
business, or whatever it might be.
    So we were starting it as a pilot program, at least our 
request is for it to be a pilot program this coming year. 
Hopefully, it will blossom into something much larger than a 
pilot program.
    But again, it is a way of connecting the western 
hemisphere--connecting with our neighbors. It is all part of 
this connectivity issue.
    I think we have a responsibility to share what we know with 
our neighbors and help them. So this is part of that effort.
    It is not a large effort from a funding standpoint,because, 
one, the private sector is helping in providing a substantial amount of 
the funds, but I think in terms of benefits, they could be vast.
    So, anyway, that is a brief explanation of it.
    Ms. Roybal-Allard. Okay, thank you. It sounds like a good 
program.
    Secretary Evans. Thank you.
    Ms. Roybal-Allard. Thank you, Mr. Chairman.
    Mr. Wolf. Mr. Cramer.
    Mr. Cramer. Thank you, Mr. Chairman. Mr. Secretary, welcome 
to the Committee.
    Secretary Evans. Thank you.

                             steel dumping

    Mr. Cramer. I regret that I had to come into this 
Subcommittee hearing late this morning. I do not believe you 
have been asked questions regarding the American steel 
industry. If you would bear with me, I would like to make a few 
comments and then ask a couple of questions.
    But I am sure you are aware that our American steel 
industry is in a crisis. We have suffered under an avalanche of 
illegally-dumped foreign steel.
    To date, some 18 domestic producers have gone into 
bankruptcy, two within the State of Alabama, and one of those 
two in my Congressional District.
    So, consequently, we have had thousands of people losing 
their jobs.
    Last year, in the final Omnibus Appropriations Bill, there 
was language in there that called on the President to initiate 
a Section 201 investigation under the Trade Act of 1974.
    My question is, though, even though President Clinton 
signed that appropriations bill into law, President Bush has 
yet to act.
    As spokesperson for the Administration, do you know if 
there will be a Section 201 investigation? Or if you do not 
know that yet, when might you know that?
    Secretary Evans. I guess my understanding is that President 
Clinton signed it into law, but he failed to act as well.
    Mr. Cramer. Correct.
    Secretary Evans. He did not start a 201.
    Mr. Cramer. Correct.
    Secretary Evans. And I am not sure exactly why he did not 
or what his reasons were after signing it into law. But the 
steel industry issue is of the highest priority to us. We have 
Cabinet-level principals that are very focused on this.
    I would say to you that we will be making comments on this 
within the ensuing weeks. It has been a problem that has 
plagued the industry for not just the last several months. This 
has been an ongoing problem for the industry for the last 20 
years.
    You have got LTV in bankruptcy for the third time. You have 
got 14 steel companies in bankruptcy today. And so I think when 
we address this issue, we should address it in a very 
thoughtful, constructive kind of way and feel confident that 
the way it is being addressed is going to solve the problem 
permanently. And it is not going to be a problem that we are 
going to deal with again in another two or three years.
    As we look at this issue very thoughtfully and very 
thoroughly and totally understand it--and it is something that 
I understand well; I have spent a fair number of my years in 
the steel mills. I understand the nature of the business and I 
understand the overcapacity that we have in the world today. 
And I understand all the trade issues that relate to it.
    I understand we have got 119 orders out there today that we 
are collecting on that are for anti-dumping and countervailing 
duty orders. I know we have got 39 others under investigation 
right now.
    So this is something that we are taking very seriously. It 
was left to us to deal with, and we are going to deal with it 
in a very, I think, constructive way.
    Mr. Cramer. Well, I hope so, and I look forward to further 
updates, and I realize that this is early in the 
Administration. But I hope that you will assess this and 
consider the Section 201 investigation as well as a Section 232 
investigation that would determine the effect of imports on 
national security as well, because these are very important 
issues. So I would look forward to updates.
    Secretary Evans. You bet, Congressman. We will get you 
those updates. The 232, as you know, is being worked on in the 
Department of Defense. We are waiting to hear from them. We 
think we will hear from them sometime in the next several 
months. But that is in their department and not in ours.
    Mr. Cramer. Is that an ongoing? As far as you know, is that 
ongoing?
    Secretary Evans. Yes.
    Mr. Cramer. Very good. I have a National Weather Service 
issue that was a leftover issue from the last Administration as 
well, and I will not subject the Committee to hearing a history 
of that.
    But I would alert you to the fact that your office already 
knows that we were inquiring about it and that we will be in 
touch with you fairly soon to get an update on what looks like 
could be a reasonable resolution of that issue.
    Secretary Evans. Good.
    Mr. Cramer. Thank you.
    Secretary Evans. Thank you, Congressman, very much.

                critical infrastructure assurance office

    Mr. Wolf. Mr. Secretary, in your view, has the Critical 
Infrastructure Assurance Office been successful in fulfilling 
its original mission to work with other agencies in developing 
a plan to prevent and respond to attacks against the nation's 
infrastructure?
    Secretary Evans. That is an ongoing effort, Mr. Chairman. 
As I mentioned early in my remarks, Commerce plays a very 
important role in this critical infrastructure protection 
issue.
    We plan an important supporting role in that program. We 
have four different bureaus that are very much involved in 
that. I think we have made progress. I think we have developed 
some very strong and important partnerships with the private 
sector, working with them so they understand the important role 
that they are playing. I know we have got ongoing dialogue with 
them.
    But as I said early in my remarks, this is an issue that is 
under full review now in the Administration as to how it should 
be structured. I know that in terms of the Critical 
Infrastructure Office itself, I am not sure we have even had 
any funding for it. We have had funding for it I know there is 
one piece inside of NTIA that we have not had funding for.
    But we have got four different Commerce Department bureaus 
involved in critical infrastructure protection--I know that 
NIST plays a big role in this whole area. They have got capital 
committed to research and development, capital committed to 
grants, andcapital committed to a team that goes out and 
reviews other agencies to see if their systems are protected.
    Commerce, as I said, is playing a very important role, 
especially BXA, where the Critical Infrastructure Assurance 
Office is located, does a fair amount of--actually does most 
of--the coordination with the private sector. Finally NTIA is 
responsible for working with the information and communications 
sector in securing their systems.
    But, has it been successful? I would say to you that, I 
think there is a lot of work to do in this area. I think first 
and foremost is making sure there is real clarity as to 
responsibility, and real clarity as to what the organizational 
structure looks like relative to critical infrastructure 
protection.
    Mr. Wolf. Who are the agencies that are involved?
    Secretary Evans. Well, we have got State involved in it, 
DoD is involved in it, Justice would be involved in it, the 
National Security Council is involved in it. Transportation is 
involved in it. Energy is involved in it. To name a few. I do 
not have the entire comprehensive list.
    Mr. Wolf. But the lead is the Department of Commerce?
    Secretary Evans. Well, we are the lead coordinator I guess 
you would say. The responsibility lies in the National Security 
office. We support the program. We support the National 
Security, and we coordinate the program and coordinate the 
planning. We are the coordinator, but you might think of us, I 
guess, as the chief operating officer.
    [The following was subsequently provided:]

    We are the coordinator for national outreach and awareness 
programs across industry sectors, for preparing and developing 
the Administration's national plan, and for assisting Federal 
agencies to analyze their dependence on privately owned 
infrastructure. The responsibility for overall policy 
development and implementation lies with the White House and 
National Security.

    Mr. Wolf. And will that continue? Commerce will continue 
that role?
    Secretary Evans. Well, again, this is under full review 
right now, and I am not sure what the final conclusion will be. 
But, we should play a very important role. I am not sure 
exactly what the role will be. I think that hopefully we should 
be prepared to discuss that in more detail in the not-too-
distant future.
    Commerce needs to participate because of our relationship 
with commerce and the private sector and the critical 
infrastructure that you deal with in that area, whether it is 
utilities or transportation or energy or whatever.
    So we will continue to play a very important role. I just 
do not know exactly what we would be proposing that our role is 
exactly.

                     economic development decrease

    Mr. Wolf. Your budget proposes to reduce EDA program by $76 
million from last year. Last year it was funded at $411 
million. Would you want to comment on why you reduced that?
    Secretary Evans. Well, I think, again, it is an area that 
has had fairly substantial increases in the last number of 
years. I think it is important to take a hard look at it and 
see that we are getting the kind of results that we had hoped 
for. I believe that the performance is indeed there.
    One of the very important principles that I want to make 
sure is being applied in this area is, as we commit these 
resources to areas that need support for infrastructure, I want 
to make sure that it is money that leads to the creation of a 
healthy workforce in the area that we are helping.
    I have seen a lot of these development programs in the 
past, dollars are spent and the hardware is there and the 
infrastructure is there, but there is no workforce there. And 
so, therefore, the local community does not grow, does not 
survive.
    And so as I have talked to people that I think are experts 
in this field, that is one of the fundamental principles they 
tell me that is often missing, and I want to make sure that it 
is not missing in our programs.
    So it was twofold. After seeing a healthy increase, I think 
let's roll it back somewhat but continue it. I think we are 
funding at three hundred and sixty-something million, I 
believe. Three-sixty-five, which is, I think a pretty healthy 
amount. And we are going to take a hard look at it, and if it 
is doing well and we think it should have higher priority in 
2003, we will give it higher priority.
    Mr. Wolf. Well, I agree with you. I agree with what you are 
doing. You had mentioned EDA earlier and economic development 
for Indian tribes. I think it is important for the 
Administration to look to see this whole issue of economic 
development on the reservations doing something constructive 
that really makes a difference in their lives.
    I have followed this rush of Indian gambling. They call it 
gaming, but it is gambling. And frankly, we looked at a study 
from the Boston Globe the other day where it said 50 percent, 
of the revenue coming in from Indian gambling is going to two 
percent of the Indians. And many of the Indians that it is 
actually going to may really not even be Indians.
    The Foxwood operation up there in Connecticut. And 80 
percent of the Indians have never received any economic 
development at all.
    So I think the more we can do in a constructive way to help 
with regard to helping infrastructure, putting real jobs, 
training and education on the reservations and not having 
gambling which is coming in which is beginning to frankly 
corrupt the country, the number of Indian tribes that are 
giving large contributions to both political parties. It is 
beginning to really I think have an impact on the country.
    So I think as we look at this, I think the Administration 
has to look at the whole issue of the expansion, because the 
Office of BIA in this Administration will have a direct impact 
on who gets to get the tribal governance, who has the ability 
to open up those gambling tribes. And many times in communities 
that do not want that type of economic, they want different 
type of jobs.

                         SPECTRUM AVAILABILITY

    The National Telecommunications and Information 
Administration published a report requested by the Committee to 
analyze the current and future use of the spectrum to protect 
and maintain this nation's critical infrastructure. The 
understanding of the Committee was the report is that the 
spectrum currently available to the Department of Defense will 
not be available for commercial industry. Is that accurate?
    Secretary Evans. Well, I am not sure that is accurate, Mr. 
Chairman. I have had a conversation with Chairman Powell and 
Secretary Rumsfeld, and we both share the concerns of adequate 
amounts of spectrum allocation for this country for commercial 
use. Understand there are very important issues to consider 
when we think about moving government services from one part of 
the spectrum to another part of the spectrum.
    There are not only the national security issues that one 
needs to think about, but there are also the safety of life 
issues that are very important when you look at moving spectrum 
and whether or not there is any interference in spectrum. One 
of the studies that we just conducted suggested that there was 
maybe some modest amount of interference. And because of that, 
it may prohibit the use of commercial application in the 
spectrum.
    On the surface, one might say, we could stand for a modest 
amount of interference, but when you start thinking about it 
being a safety-of-life issue, then all of a sudden, as far as I 
am concerned, a modest amount of interference is unacceptable.
    So there are just some difficult issues that I think we 
need to continue to work through. I think, again, the most 
important aspect of this is not a rush to judgment. I think it 
needs a serious review by the principals involved and making 
sure the principals involved have their teams of people, their 
organizations, looking at it seriously and thoughtfully.
    And so, I am not in a position at this moment, and I am not 
sure anybody in the Administration could tell you what our 
recommendation would be or what we may be able to move in the 
spectrum or cannot move, because we really have not had a 
chance yet to take a real, hard, serious look at it. I think it 
is important that we not rush to judgment.
    I think it is important that we look at this very 
thoughtfully and very thoroughly.
    Mr. Wolf. So it is really not accurate to say, then, that 
the spectrum currently available to DoD will not be available 
for commercial? Because you have not concluded is what you are 
saying?
    Secretary Evans. Yes. We have not concluded. I mean, I 
would say it is certainly not available today. We all know 
that.
    Mr. Wolf. How about will not be in the future?
    Secretary Evans. Yes. And will not be is just a function of 
whether or not we sit down with, as I sit down with Secretary 
Rumsfeld and let him sit down with his people, and talk about 
the needs of spectrum in our society and see if there are other 
spectrum that might serve them in the same kind of way, if not 
better than they are being served now, they could move some of 
theirs.
    I mean, that is a possibility. And I just do not know at 
this stage of the game whether or not it will become a reality. 
It is just something that needs to be reviewed.
    I know this. I know they are certainly willing to talk 
about it. So if they are willing to talk about it, that says to 
me that, it is a possibility that we may be able to free up 
some spectrum.
    Mr. Wolf. The issue of a stable Internet is important to 
the U.S. and most other countries worldwide. Currently, the 
authoritative route serve for the Internet is housed here in 
the U.S. Is the Department of Commerce doing anything to alter 
the current status of the route server? And has any country, 
including China, proposed or threatened in any way to establish 
its own route server?
    Secretary Evans. I do not know, Mr. Chairman. I would have 
to get back to you on that one. That is an issue that has just 
not come across my desk. But I am happy to get back to you on 
it and get you a full response on it.
    [Clarifying statement follows:]

    The Chinese Government has not made any public statements 
threatening to establish its own ``A'' root server. However, 
several companies and organizations, both U.S. and non-U.S., 
are experimenting with new technical standards that allow users 
to register domain names in character sets other than English. 
My understanding is that China is working on systems that would 
facilitate domain name registration in the Chinese language.
    The authoritative root server is currently operated by 
Network Solutions, Inc. under a Cooperative Agreement with the 
U.S. Department of Commerce. The Internet Corporation for 
Assigned Names and Numbers (ICANN) has been working with an 
expert group of Internet engineers and root server operators on 
an enhanced architecture for Internet root server system 
security. This study, which has been undertaken in cooperation 
with the Department of Commerce under a Cooperative Research 
and Development Agreement (CRADA), is an important effort aimed 
at increasing the overall security, robustness, and reliability 
of the Internet domain name system. When the necessary 
technical capacity is in place, the Department may enter into a 
cooperative agreement or other legal arrangement with ICANN to 
operate the ``A'' root server on the Department's behalf. If 
this were to occur, the Department would likely require ICANN 
to operate the ``A'' root server under the same terms and 
conditions under which Network Solutions, Inc., currently 
operates the ``A'' root server for the Department.

                      ADVANCED TECHNOLOGY PROGRAM

    Mr. Wolf. The budget with regard to the Advanced Technology 
Program, could you say a little bit about it? It does not 
include funding for the Advanced Technology Program. We heard 
that you wanted to have a review of it. Is it a review to see 
if you want to have it? And when will the review be completed?
    Could you for the record tell us----
    Secretary Evans. Sure, I would be happy to, Mr. Chairman. I 
know it is an issue that has been discussed ad nauseam here. 
And, I would just say to you that I think a couple of things. 
That the Federal Government's got a very important role to play 
in the area of research. And there should be no question that 
this Federal Government has been dedicated to research over the 
years. Certainly I am not confused at all about the fact that 
this technology boom, this knowledge-based economy, and this 
high-tech economy that we are all experiencing, comes from 
research from the Federal Government back in the fifties and 
the sixties. I mean, that is where it all began.
    And so there should be no question about the principle of 
the Federal Government's role in research, particularly I would 
say basic research.
    Now when you come to NIST and look at its core mission and 
you understand its core mission, as I mentioned earlier, I do 
not think there is anything more important than making sure 
that that is funded. And when I listen to some people that 
serve on advisory committees that are there and they tell me 
that they are worried about the funding of the core mission of 
NIST, NIST labs coming out of the ground that I know the money 
has already been allocated and appropriated for the building of 
the buildings. But then you have to make sure you have the best 
of equipment available to the scientists.
    And so I know we are going to be coming to this Committee 
in the ensuing years asking for funding, substantial funding, 
quite frankly, for new equipment in these buildings. That is a 
pretty high priority to me.
    And so I think about that priority in the years ahead. And 
then I look at the Advanced Technology Program. And I 
acknowledge that there are a number of terrific successes 
inside the Advanced Technology Program, you know, and that is 
notable and I do make note of that.
    But I would say to you that I think it is time to look at 
it thoughtfully and thoroughly and say that, yes, this is where 
this kind of research belongs, and it does not belong someplace 
else.
    I mean, to me it is just part of the total research dollars 
that the Federal Government is committing. And so, I wanted to 
think through, is this the right place for it? And I also 
wanted to make sure that it was structured in a way that I 
thought was appropriate.
    I at least asked for it. I mean, one of the problems I have 
with the program is that universities are not allowed to take a 
lead role. Now, one of the biggest problems we have in America 
today is the lack of graduating scientists and engineers. And, 
we have got requests in for H1B visas of 192,000, and we are 
graduating 62,000 engineers and scientists a year.
    And so, to me, I would want to be someone who was allowing 
the universities to take lead roles in these kinds of programs. 
I had a fair amount of experience myself in Texas, having 
served as the Chairman of the Board of Regents at the 
University of Texas system. I saw our system. I saw our 
universities developing real strong public-private partnerships 
where they took lead roles in this kind of research.
    And so, I questioned whether or not that would enhance the 
program.
    So, I felt like it was time to reassess, knowing the issues 
on both sides of the Advanced Technology Program. Some people 
have called it corporate welfare. Some people have called it 
venture capital. I want to make sure that those dollars are 
being spent in an appropriate way and felt like it was time to 
take a hard look at it.
    Again, as I mentioned earlier, we have already awarded some 
grants that have not one year, not two year, but three year 
commitments to those grants. And I felt like we ought to 
develop a way so that we could fully fund those commitments in 
year two and year three, and that is why I think in our request 
that we sent up I said, we still have sixty-some million 
dollars left in the 2001 budget. Let's take those dollars to 
fund the commitments out over the next two to three years.
    Mr. Wolf. Well, I think that is reasonable. Obviously, 
people have spoken to you about it. You are basically saying 
you just want to take a look at it. It is not ending exactly, 
but you just want to take a close look at it and give it a 
review and maybe come back. Is that sort of what you are 
saying?
    Secretary Evans. Yes, sir.

                           CONFLICT DIAMONDS

    Mr. Wolf. I think that is very fair. Switching issues a 
little bit, since you mentioned NIST, the National Institute of 
Standards and Technology does internal research in addition to 
external research grants.
    They were part of a working group in the last 
Administration to explore the technical solutions to the 
diamond problem. And I wonder--I do not know how much you know 
about the diamond problem. The conflict diamonds are driving 
the war in Sierra Leone. They are driving the war in the Congo. 
If you looked at The Washington Post on Monday, three million 
people have died in the Congo in the last three years. And in 
Sierra Leone, you have lost probably 150,000, and they are 
hacking off arms of women and children. Will you get NIST to 
take a look at this again and see if they could kind of 
cooperate and maybe come up with something that would help us 
to deal with this issue?
    Secretary Evans. Indeed I will, Chairman. I am aware of it. 
I know of our concern. It is my concern, too. I know NIST has 
looked at it. Their conclusion was not what we would want it to 
be the first time around. They said it would be very, very 
tough to identify the diamonds. But I will get fully briefed on 
it and ask them to take anotherlook at it to see if there is 
something that they can do to help us with this serious problem that we 
face in the world.

                      PATENT AND TRADEMARK FUNDING

    Mr. Wolf. Thank you. Just a couple more, and then I will go 
to Mr. Serrano and come back. As you know, the industry with 
regard to the patent and trademarks, which is in my area, a 
critical amount of time it takes, members in the industry 
complain, for the Patent and Trademark Office to process 
applications.
    The same critics have been faulting the Administration and 
this Committee, the Appropriations Committee, for inadequately 
funding this office. Your request includes an increase of $100 
million over the last year for a total $1.14 billion. Are you 
confident that the level requested in the budget is adequate to 
address the needs for those applying for patents and 
trademarks? That is one.
    And the other is, they have increased tremendously, I think 
51 percent in fiscal year 1999. They have lost 51 percent of 
the people, but their budget has gone up. Is it just a budget 
issue, or is it also a management issue? Do you need people 
over there who can manage better? Or do you just think it is 
just a question of dollars?
     Secretary Evans. I think, Chairman, that it is an issue of 
the times that we are in. There is so much going on in this 
high-tech community that, unfortunately, PTO, to some degree, 
is a training ground for individuals to come and learn the 
trade and learn the issues and then go out into the private 
sector.
    And, unfortunately, we just cannot compete with the private 
sector. This very issue that you talked about is a real one. I 
know that the turnover rate has gone from 6 or 7 percent four 
or five years ago to up to 14 percent this year. So they really 
are experiencing a very high turnover rate, and I think it is 
in large part just not being able to compete with the private 
sector.
    There is incredible demand right now for people with these 
skills because of this technology revolution that we are going 
through and are in the middle of. And so, they come and get 
good experience and good knowledge and get trained, and then 
they go find something that is more attractive to them. It is 
an issue that I am very interested in. The pendency rate has 
gone above--I know they have had a target of about 14 months in 
2001. They have got a pendency rate now that is approaching 18 
months in 2002. That is unacceptable. We have got to find ways 
to bring it back down.
    And so, we are focused on it. If they need more resources, 
then we ought to talk about more resources.
    I mean, to me, that is the backwards way to approach it. We 
need to figure out what they need and then we need to fund 
those needs, and not worry about what they are bringing in, or 
not bringing in.
    And so I have had several discussions with them about their 
needs and their concerns. We will have a new director in place, 
hopefully in the not-too-distant future. I am excited about a 
new director getting in place and getting very focused on this 
very important issue.
    Mr. Wolf. I wonder if it is not a management problem too 
because last year, almost 50 percent who left, had served less 
than a year. I mean, you cannot even find your way around in 
less than a year.
    And you are not eligible or trained to go out to a major 
firm in less than a year.
    Secondly, there is something about government service. My 
sense is you probably took a pay cut when you came here. My 
sense is a lot of people have come here, and there is something 
about government service. It is important.
    And so I think it is a little bit maybe more. Maybe there 
is a management problem too. Are you asking for special pay 
increases?
    Today, there was to be a bill up on the floor with--I do 
not know what is going on, I think we are trying to decide what 
the other side will allow us to decide--but there was a bill to 
increase the pay for SEC lawyers and different people there.
    Have you looked at that? Are you looking at that?
    Secretary Evans. We have requested a special pay increase 
for patent professionals.
    Mr. Wolf. Has that been sent up to the Hill?
    Secretary Evans. Has it been sent up? Has it gone to the 
Hill?
    It has been sent to OPM.
    Mr. Wolf. Yeah. Well, they ought to move quickly because 
the cycle moves. Now maybe what you can do, in order to catch 
the cycle, if you really believe that this is the answer, is 
perhaps get the approval of the appropriate authorizing 
committee and perhaps we could carry it in the appropriations 
bill.
    Secretary Evans. Right.
    Mr. Wolf. But you are going to run out of time because in 
about another three weeks or four weeks, this place focuses 
solely on the appropriations bills, and then a couple other 
issues that crop up. And this type of thing gets put off unless 
it gets caught early.
    So if this is important, you might want to speak, I guess 
that would come before Mr. Burton's Committee, but get them to 
take a look at it, and if they felt comfortable, we might be 
able to put it on our bill, if that was important to you.
    Secretary Evans. Thank you, Chairman.
    Mr. Wolf. I have some others, but let me just recognize Mr. 
Serrano.
    Mr. Serrano. Thank you, Mr. Chairman.
    Mr. Secretary, just for my information, a little aside 
question here. Some years ago, there was a big move to get rid 
of the Commerce Department in Congress.
    You have not heard anything like that at the White House?
    Secretary Evans. No, sir.
    Mr. Serrano. Okay. And you probably would know?
    Secretary Evans. I would probably know. [Laughter.]
    Mr. Serrano. It is good to know you are going to be around 
for a while.
    Secretary Evans. Right.

                     MINORITY SERVING INSTITUTIONS

    Mr. Serrano. Let me just come back to minority-serving 
institutions. We discussed part of it, and the whole issue was 
that last year, as you know, $15 million went to NOAA to 
develop a program with minority-serving institutions to 
increase the pool of minority scientists in the disciplines 
that NOAA needs.
    The Administration last year made a similar request, which 
was not funded, for the National Institute of Standards and 
Technology.
    First of all, do you think NIST has similar needs to NOAA's 
and should be developing partnerships with minority serving 
institutions, and how can you assist us in doing that?
    I should have prefaced my comments by telling you that to 
alarge group of members this is an extremely important issue, the whole 
idea of taking these institutions to work in partnerships, and you are 
a fan of partnerships, to create the kinds of people able to move into 
different positions in the different agencies and to serve this country 
properly.
    So we know about NOAA and they are going to do what has to 
be done. We would like to know what you think NIST can do and 
should do.
    Secretary Evans. Right. Congressman, I share your feelings 
about this. We were talking about this very issue yesterday 
with NIST, not funding for a program, asking what they are 
doing to reach out to children in this country and education 
institutions in this country, to encourage our young people to 
consider the sciences.
    Sometime in the not-too-distant future, the 19th of May?--
the 9th and 10th of May, we are going to have some 9,000 school 
children come to our campus at Gaithersburg and take them 
through the campus and they will see experiments and they will 
talk to scientists, and it is just a fair for these school 
children.
    We are doing the same thing in Boulder where we have the 
labs out there and have some 4,000 or 5,000 school children 
coming out there.
    I asked them, okay, are there ways to kind of cross 
America? I mean, you are focused on the school children here in 
the Washington, D.C. area which is great; I am delighted that 
we are, and we are also in the Boulder area, which is terrific.
    But listen, we really do need to have a serious effort when 
it comes to ways of interesting all of our students, minorities 
and otherwise, in the sciences.
    And so I am not familiar with the specific program that you 
are referring to that was not included in the budget, but I am 
one that is certainly very interested in ways to interest the 
students in these important fields.
    I know talking to our NOAA leadership that they are very 
enthused about the results that they have been seeing and the 
performance and the effectiveness of their program. And so, we 
will look at that success, and if we can build on that success, 
then terrific.
    Mr. Serrano. Well, I would appreciate that because my 
understanding is that it was a similar request for NIST, but 
that one did not get funded, and of course that is not the 
Commerce Department's problem; it is ours.
    But if we can gain you as an ally in moving across the 
spectrum to the different agencies that could begin to work up 
partnerships with minority serving institutions, we would come 
a long way in dealing with these issues.
    Now, the whole idea of bringing the children there, I 
support that. But we also want something done at the higher 
educational level to begin to prepare people immediately.
    Secretary Evans. Well, I hear you, totally. I mean, this is 
a serious issue in this country, and just look at what we are 
doing relative to other countries in the world in the area of 
sciences and engineering and having our work force competitive 
with other work forces in the decades ahead. And this is 
something that requires our serious attention.
    I have learned in my years in education institutions that 
you need to catch them early and get them interested and get 
them focused and get them excited about a field like science 
and engineering.
    Unfortunately, if you do not catch them early, then it is 
difficult. I have talked to presidents of universities and 
deans of engineering in colleges and oceanography colleges 
across America, they are all saying, where are the students. 
They are not coming through the pipeline, and why are they not 
interested?
    And so to think that there are some efforts out there in 
the higher K through 12, and the tenth, eleventh and twelfth. I 
know in my home state of Texas they have programs trying to 
interest those in the sciences early, but I will tell you, I 
think you have to start young. You have to get them interested 
early on and tell them this is a noble field for them to be in.
    Mr. Serrano. Absolutely.
    And, Mr. Secretary, you mentioned before, and I know we are 
not knocking those programs, that we are issuing visas for 
people to come into the country who have special skills, and 
then at the same time, you have so many people from certain 
communities saying, we have not been given an opportunity.
    So I would applaud anything you could do, both at the 
starting level of introducing children to the sciences and to 
the opportunities there and then secondly to review this whole 
issue of minority-serving institutions and how we can include 
them in preparing people for the not-so-far distant future to 
make sure that they are involved in it.
    And I would support you and applaud you.
    Let me----
    Secretary Evans. May I say one more thing about that?
    Mr. Serrano. Sure.
    Secretary Evans. I am sorry, Congressman, for interrupting 
you. But I have spent a lot of time on the border of Texas. 
University of Texas Systems have more Hispanic students than 
any system in the country.
    And we have got some terrific programs that were funded at 
the state level, and they were public and private partnership 
kind of programs, all along the border, where we focus on 
students in high school and get them serious about the maths 
and the sciences, and if they reach a certain goal, then there 
is a scholarship waiting for them at the university to enter 
the College of Engineering or the College of Arts and Sciences.
    And so, there are a lot of good programs out there, and any 
emphasis, any focus that we can put on it in this country I 
think is for the good.
    Mr. Serrano. All right, thank you.

                           ISLAND OF VIEQUES

    Let me go back for a second to the very hot issue in the 
news these days, and that is the issue of the Island of Vieques 
off Puerto Rico.
    In FY 2000, $40 million was appropriated to the Defense 
Department as part of an agreement the previous Administration 
had with the then-governor of Puerto Rico, relating to the 
Island of Vieques. A portion of those funds was to be 
transferred to the Commerce Department to address environmental 
and economic concerns.
    I would like to know what the status of thosefunds is.
    Also, under the original proposal, the Economic Development 
Administration was supposed to participate in this program. 
What is the status of EDA's participation and why did they not 
receive, to our knowledge, a portion of the $40 million?
    Secretary Evans. I know of the $40 million, $3.85 million 
is being transferred to Commerce. Has that happened? The money 
has been transferred?
    Mr. Serrano. That is for NOAA, right?
    Secretary Evans. Okay. They are saying to me that it is on 
the verge of happening, and I know that there are several 
pieces of that, and one of the pieces is economic development, 
and I think that number is about $1.6 or $1.7 million but I am 
not----
    Well, here, why don't you tell it. You know more of the 
specifics than I do.
    Mr. Gudes. The breakdown of the $3.8 million is $1,850,000 
for artificial reefs; $1,500,000 for payments to commercial 
fishermen [that was the economic issue]; and $500,000 for coral 
reef conservation.
    And as the Secretary said, these are all funds that we are 
waiting to get transferred to NOAA to do our part in the 
Vieques area.
    Mr. Serrano. Did you say artificial reefs?
    Secretary Evans. Yes, sir. $1.850 million for artificial 
reefs to help restore I think some of the reefs that were----
    Mr. Serrano. That were destroyed by the bombing, which is 
another issue.
    Okay, thank you. That sounds like such a terrible use of 
language, artificial reefs.
    But anyway, I would hope that we can, at least, Mr. 
Secretary, move that part along. You know, there was an 
agreement between President Clinton and Governor Rossello which 
not a lot of people are in favor of because it included the 
resuming of bombing.
    But once you take bombing out, and that is the biggest 
part, everybody supported the idea of working on the coral 
reefs and the economic development.
    Eventually, if the bombing stops, and it is getting to a 
point where it might, there is a whole issue of what happened 
to that island for 62 years.
    That may or may not include you guys but the removal of 
what people know is live ordnance that is still all over that 
island.

                                 census

    I am just going to save the rest of my questions, Mr. 
Chairman, which were really only all about the Census. I 
understand we are not having a Census hearing as such.
    So I would just remind you, Mr. Secretary, that I am a big 
supporter of what the Census Bureau does, no window 
notwithstanding. Because when you have a district like mine, 
really with a good and solid and fair Census count, I can make 
arguments on behalf of that community that can stand up, not be 
based on what I know the truth to be, but based on what the 
truth is about who lives there and under what conditions they 
live there, and what they own and what they do not own.
    And from there, you can move on and talk about the rest of 
the nation when you have an accurate count. So I am a strong 
supporter of the work that those professionals do and my prior 
public record indicates that and Committee records indicate 
that.
    But there is a lot that we have to be careful about in how 
the Census Bureau conducts its business, and as we plan for the 
next decennial. I hope that we really take seriously the 
mistakes of the past and, you know, consider us your 
supporters.
    The biggest fight we had has gone now for a little while. I 
will get a new congressional district, and then we will discuss 
that again ten years from now.
    But that one should not be the one that ties your hands. 
That issue is handled on the House floor. There are other 
things you could do that would be very helpful, and I thank you 
for your testimony today.
    Secretary Evans. Thank you, Congressman.
    Mr. Wolf. Mr. Secretary, I have a few more, and I will try 
to go through them in the interest of the time.

                          noaa responsiveness

    NOAA--and I am learning this too. I was the chairman of the 
Transportation Appropriation Committee for six years, and the 
Republicans, rightly so, voted to rotate, term limit. And I 
think it is great and I was excited about the change.
    But I am sort of learning too. But NOAA represents 63 
percent of the Department's budget. The Coast Guard used to 
create attention. The Coast Guard came before my Committee with 
NOAA, so I do not know if I should begin to side with NOAA now, 
or what.
    And you have gotten a tremendous increase. The Staff tells 
me that they have had serious problems of getting information 
out of NOAA. I do not know this firsthand, although I believe 
the Staff. I think they are a good group of people.
    And we had a great relationship with Secretary Slater; he 
was a Democrat, I was a Republican, but we had a good exchange 
and so we would just ask you to, when your new person at NOAA 
comes on, that there be an open willingness to share and give 
the Staff the necessary information, particularly since NOAA--
and years ago, I was in the Nixon Administration, and there was 
a proposal to take NOAA out of Commerce and put it into the 
Department of Interior, and I think they were going to call it 
then the Department of Natural Resources.
    And I knew that NOAA was big, but I did not know that they 
were 63 percent until this Committee became under one of my 
responsibilities. But we would really want to make sure that 
the information flow is timely and accurate, reliable and 
dependable, and that we make sure that that is a good 
relationship.
    If we could make that case with the new persons coming on.
    Secretary Evans. I will indeed, Mr. Chairman. I do not 
think there is anybody I know on my management team that is 
confused at all about my thoughts on that, my position on that. 
They know that one of my pet peeves is not getting back to 
people. I do not care what the answer is.
    I would like for it to be something that you would like the 
answer to be, but the most important thing is being responsive, 
and we have talked about that on numerous occasions in the 
Department. I know we have had some problems in that area. I 
know in some of the areas we have corrected those problems, but 
we will continue to work on that.
    There is not anything more important to me than us being 
responsive to you, and I mean responsive in a timely kind of 
way. And so, I am trying to get that message out loud andclear. 
And I will continue to work on that.
    Mr. Wolf. When will the new person from NOAA be on?
    Secretary Evans. Well, I would say realistically it is 
probably not before the summer recess. I am hopefully close to 
making that selection.
    If I can make the selection by mid-May, then that would say 
to me, by mid-July, that hopefully that person is confirmed, 
may be on earlier, may be in place, but not confirmed yet.

                        census suitland facility

    Mr. Wolf. As you work at Mr. Serrano's brother's office, I 
can sense this--there is a window and a corner office too, if 
you would like to have it--what floor?
    He does not care.
    If you could have heard him as we were walking over, he 
said--with a coke machine.
    Can you say some things about the Suitland facility?
    I serve on TPS and I have heard Mr. Hoyer talk about it 
over and over. The building's in, I mean it is in decay. It is 
just a disgrace.
    I have never been in the building. I am going to go in, but 
I know it is in Mr. Hoyer's district and it came before TPO 
time after time, and OMB would say no, and say can you bring us 
up to date on where you are, the GSA is, and the OMB is?
    Secretary Evans. Right. It is a disgrace and it is in 
decay. And I have been there. I have seen it with my own eyes. 
I saw it the second day I was on the job. I went out to see the 
good people out there, and it is a great team of people with 
lots of great professionals.
    And the conditions they are working in are just not the 
kind of conditions we would expect any government worker to be 
in.
    But I know that it is high on GSA's list. I think it has 
been approved?
    Is that right Bill? Or not quite? Not quite.
    So not quite approved. I know it is high on the priority 
list, and we are looking for approval by what date? Do we have 
a date that we think they are going to say yes or no?
    Do you want to come say something? Come on.
    Mr. Barron. We are very pleased that in this 2002 budget 
request, they are asking for redesign money. We were hoping 
frankly that that would be construction money.
    And so we will be looking towards 2003 for that to appear. 
In the meanwhile, we are continuing to negotiate with GSA as to 
the type of improvement they are going to do for us. And 
perhaps I could come meet with your staff and brief you on 
that?
    Mr. Wolf. Sure, be glad to. And we can meet with Mr. 
Istook, who is the Chairman of that Committee. I think the 
Census Building is probably in worse shape than any of the 
other ones that they are actually talking about.
    Mr. Serrano. Mr. Chairman, could I interrupt you for a 
second?
    Mr. Wolf. Sure, sure, absolutely.
    Mr. Serrano. There is a concern that we have, you know. We 
also were hoping that they would ask for construction money. So 
here if they ask in 2003, and we get into that argument, then 
by the time they do get a new facility and move in, how would 
that impact conducting the next Census?
    Secretary Evans. Mr. Serrano, that indeed is the heart of 
the argument, and we would like them to pursue an option that 
would still be 2007 before we move in.
    But under the options they are proposing, it would be 2009, 
2010, and I keep telling folks that is probably beyond my life 
span at this stage, but clearly we need to do something, we 
cannot have people working in these conditions for another nine 
years. I mean, that is just abominable to contemplate.
    So I would love to be able to come up and to talk with you 
about this, and see if we cannot move it forward a little more 
rapidly.
    Mr. Wolf. I say this jokingly, and I want to make that 
clear, but Mr. Hoyer and I have always had a little creative 
tension, but we have some buildings out off of the Fairfax 
County Parkway, and we are only kidding, but we do not want to 
move people because they have their families. But everyone is 
trying to move somebody else, but there is space if you ever 
want to come to Fairfax County, is what I am trying to say.
    Mr. Secretary----
    Mr. Serrano. Got space in the Bronx. [Laughter.]

                      unfilled ita trade positions

    Mr. Wolf. Mr. Secretary, in your statement, you said that 
trade enforcement and compliance is your highest priority for 
the ITA.
    The Committee provided a number of new positions. Many 
were, the funding was to be, particularly with regard to China, 
the China vote and everything else.
    Without putting you on the spot, we have been told that 
none of these positions have been filled. We also were told, 
rather than me asking you a trick question, how many have been 
filled, the answer is none.
    Secretary Evans. Right.
    Mr. Wolf. None have been filled, and we are a little bit 
concerned that there is a hiring freeze, and so I think it is 
important to fill them and not have a hiring freeze. Because 
those of us who are really tormented on this issue, being a 
free trader, but my faith on the persecution, it just 
clasheslike this. And those of us who struggle on this issue really 
need to know that these people are on board, and I think many members 
voted because they thought some things were being done.
    So if you have any indication of how many you can fill or 
can you get rid of the hiring freeze so we can put these 
people----
    Secretary Evans. Well, it is not a hiring freeze. All these 
people are exempt from the hiring freeze because these are 
funds that have already been appropriated. It is in the 2001 
budget and so we are hiring them as fast as we can. I think we 
have hired 16, they tell me, out of 60 some odd----
    Mr. Wolf. They are actually on? Sixteen are on?
    Secretary Evans. They are on or coming on within----
    Mr. Wolf. But how many are actually on today that if I went 
down to their office and opened the door, they would be there?
    Secretary Evans. We will get back to you.
    [The following was subsequently provided:]

                      Trade Compliance Initiative

    The Trade Compliance Initiative is operating in two of the 
International Trade Administration's units, Market Access and 
Compliance and Import Administration. The International Trade 
Administration has been vigorously working to fill the 62 
positions dedicated to this important initiative.
    Market Access and Compliance, with 35 of the total 
positions, has nine new people on board, and ten additional 
people who have been selected but are either undergoing 
security review or are scheduled to report on an agreed upon 
reporting date.
    Import Administration's headquarters operation, with 20 of 
the positions, has five people on board, three people are 
undergoing security review and are awaiting a reporting date, 
and one additional person will report July 02, 2001.
    Import Administration's hiring of seven overseas positions 
is about to begin. The certificate of highly qualified 
candidates was delivered to Import Administration by the Office 
of Foreign Service Personnel on May 17. The decision process to 
fill six of the seven positions is underway. One additional 
overseas position (Geneva) is still being developed, but should 
be recruited soon.

    Mr. Wolf. It is really not your fault because you are 
coming in new, but I think it is important to get these people 
on.
    Secretary Evans. Sure. I could not agree with you more.

                US EMBASSIES ROLE WITH AMERICAN BUSINESS

    Mr. Wolf. And one other issue too that was talking about 
the embassies. I think it is important for our people in the 
embassies, your people, our people, to really be advocates for 
American Business abroad.
    Some of our businesses are at a disincentive because the 
corruption levels in some of these countries is very, very 
high, so I think we need, our businessmen and women need an 
extra push.
    I think the more aggressive our foreign-service people are, 
your people are, in promoting American businessmen and women, 
small business particularly because they do not have the 
Washington office and the Moscow office and the London office.
    Sometimes at embassies you just do not get the feeling that 
business is really a priority. Obviously the number one role of 
the embassy is diplomatic and negotiations with the State 
Department, but your people play a very, very important role.
    So I think the more aggressive they are in a fair, ethical, 
moral, decent way--I am not suggesting in a way that some other 
countries do--but to be advocates for American businessmen and 
businesswoman, I think, would be very helpful.
    I do not know how the morale is of your people abroad, but 
I think it is important that they know how important that role 
is and that they should be advocates for the United States 
business.
    Secretary Evans. I agree totally with you, Chairman. I 
think that is just part of the job description.
    My sense so far, in my travels to the West Coast to see the 
Foreign Commercial Service Officers that are spread throughout 
the Pacific and Asian region, is that the morale is good.
    They are upbeat, and they are optimistic, and they are 
advocates, and they are excited about what they are doing.
    That is also my sense after having spent a few days in 
South America, but have I been around the world? No, I have 
not.
    But, you are exactly right. I mean, that is a very 
important responsibility. They all should feel and be proud of 
that responsibility. I think we do have a lot to sell around 
the world.
    So, it is something--I think your point is well made. I 
will make sure that, when I talk to them, I express your 
thoughts, your concerns, because they are mine as well.

                        CREATING JOBS IN PRISONS

    Mr. Wolf. Earlier, you were talking about industry and 
balance of payments, and different things like that.
    I put a Bill in the other day which we think the 
Administration is going to support, and it would be helpful to 
have you weigh in. It does the following.
    You really cannot put a man or woman in jail for 15 to 20 
years and give them no work. There are some segments of 
American industry that are concerned with the competition 
coming from the federal prison industries.
    I do not know if you have been in any prisons, but in our 
federal prisons we attempt to have the men work.
    If you put a guy behind bars 15 years and all he does is 
push a broom, when he gets out he is going to come and commit 
the same type of crime, maybe even worse.
    The Bill does, the following. While it phases out the 
mandatory sourcing for purchasing of goods from Federal Prison 
Industries, it also says that we will create in federal prisons 
the following program:
    We will find industries that are no longer in the United 
States, goods that are no longer made.
    Ten years ago, we tried to do this with a television 
manufacturer that was in St. Louis. They were willing to come 
into Lorton Reformatory and make televisions, because there are 
no televisions--at that time they were the only one.
    Some men came about. There was opposition, so they went 
away. They are now in Mexico. We want to bring in prison 
industries, companies. There is a major company that I know, 
Rubbermaid, who is interested in coming into the federal 
prisons.
    What we would do is we would only bring products in thatare 
no longer made in the U.S., so we are not in competition with any 
American company that is manufacturing here.
    We are not in competition with any labor union or anybody 
else; in fact, that we actually create jobs, because the truck 
who has to drop the supplies by--the wiring and whatever--is a 
truck driver who is an American who is working.
    We believe we can create hundreds of thousands of new jobs. 
With the wage that we pay the men, one-third will go for 
restitution. In Exodus, Leviticus, and Numbers, it talks about 
restitution. If I commit a crime against you, to give you 
something back.
    Another third will go to pay for the upkeep, which will 
help us deficit-wise but otherwise, too.
    The last portion of it will go whereby they can save this 
money and have it, whether it be for their families or gate 
money as they are released.
    We are really going to make a big push on this. I think the 
President has done more to help.
    This ties into another thing. We are going to try to in the 
bill point out some out faith-based prisons. If you want to 
change a man, you change his heart.
    And we believe--and I do not think the President realizes 
how much good has come out of this whole faith-based concept, 
because there were people four or five years ago that would not 
even talk about it that are now asking Prison Fellowship and 
Chuck Colson's groups to come on in and teach them how do we do 
this.
    We will send you a copy. If you could, look at this, 
because I think this is an opportunity, again not in 
competition with any American business. But these would be 
American businesses who would bring their jobs back into 
America, perhaps at a margin that would not be productive to 
have it in a normal case but it could be in a factory.
    You could be training these men and giving them dignity, 
give them the opportunity to have a skill, and also hopefully, 
we have called it Operation Condor. I do not know if you are 
familiar with the condor.
    When I was at Interior, the condor was going extinct.
     The condor at Interior, they put the condor back into 
California, because they brought birds together and bred the 
birds.
    This is a Condor. This is to bring industries that are no 
longer operating in this country back into this country and 
giving men dignity.
    Could you take a look at this----
    Secretary Evans. I will, indeed.
    Mr. Wolf. And see if we can get the Administration--
Attorney General Ashcroft appears to be for it.
    He was before the Committee yesterday. We would like to do 
something in this Bill, and to have the President's support and 
your support would be very, very helpful.
    A couple others:

                           TRADE WITH AFRICA

    Africa. Maybe you can just--I had a couple of questions 
which I will not go into in any detail but maybe you can tell 
us a little bit about Africa.
    I was in Africa in January. We were in Sierra Leone, the 
Congo, East Congo, West Congo, Burundi, Rwanda, Uganda, and 
Sudan. The Country, the Continent is falling apart.
    In the year 2015, there will be 40 million orphans because 
of AIDS. Economic development is moving very, very slowly.
    Can you tell us what your plans are with regard to trade 
with Africa to help, because trade is certainly better than 
foreign aid, although I am for it. Could you talk to us a 
little bit about that?
    Secretary Evans. Well I will be happy to say a few words 
about it, Mr. Chairman. I probably cannot go on too long about 
it, because it is not something that I have really focused on 
yet.
    But as you mentioned, early on I had a long conversation 
with Franklin Graham about Africa, and he had just returned 
from Africa. I know of some of the serious plights and serious 
issues that that part of the world faces.
    And so I have made the comment in the last month or so that 
it is an area that I want to spend some time and want to focus 
on.
    I know that one of your fellow Congressmen has a trip 
planned for later in the year to Africa. I have indicated to 
him I would like to go to spend time in Africa.
    So, I am not aware of any, bilateral trade agreements that 
we are negotiating in Africa right now, but I share your view 
that the best hope for Africa and these impoverished countries 
is trade, and getting them trading with America.
    So as I have the opportunity to spend more time focused on 
Africa, go to Africa, talk to the leaders of Africa, I hope 
that constructive talks come from that and we can open up a 
dialogue where we can see the most effective paths to help that 
part of the world.
    I mean, it is tragic what is going on to our fellow human 
beings over there.
    I view the world as they are our neighbors. We should be 
concerned about all of them. So anything that I can do to help 
that area I want to do it.
    But do I have any specific plans? No, I do not right now 
other than going to Africa sometime later in the year.
    We are implementing the African Growth and Opportunity Act. 
I should have mentioned that. I was talking to the Black Caucus 
the other day and had a good visit with them. I told them what 
we were doing with that Act to implement it and to build on 
that, hopefully.
    But, anyway, I hear your sensitivity, your concerns. I 
share them. I think that, more and more, you will see this 
Administration talking about that area and ways that we can 
support them and help them.
    I do not think there is any better way to show that than to 
show up there and talk to them and visit with them, and see it 
myself.
    So, I totally agree--I am going to do that.
    Mr. Wolf. Well that would be great. And I hope when you go 
you can visit some of the--too many people just go to South 
Africa or they go to Nairobi, but I hope you will go to the 
Congo and Ruwanda and Burundi and some of those places.
    You can do the whole trip probably in about seven days, but 
seeing it, and feeling it, and touching it, and being there----
    Secretary Evans. Absolutely.
    Mr. Wolf [continuing]. And what has happened, the Colony 
powers exploited Africa during the '60's and '70's, '80's.
    We used Africa, sort of, and I supported it very much so 
with regard to the East-West battle. But now that the East-West 
battle is over, everyone is leaving.
    They do want to do business with us. They care about 
America. They want us to be there and not necessarily some of 
their former Colonial powers.
    So there is an opportunity of what should be good for us, 
but I think an opportunity of what should be good for them.
    In Luke, it says, you know, To whom much is given, much is 
expected and required. And so we have been given much.
    I think the opportunity is here. So I hope you can and 
maybe give us a report when you come back of what you are going 
to be doing through that.
    Two other or three other questions. You inherited a very 
expensive automation project called CAMS that is scheduled to 
take 14 years to become fully operational.
    The Committee just received the first-quarter 
implementation report and enclosed a price tag of $241 million. 
The full outyear costs of the program are proposed to be $382 
million.
    Are you going to continue the program as proposed? Or is 
your CIO going to look at it? Or what do you think?
    Secretary Evans. Yes. What I have learned so far is yes, we 
are going to continue. Yes, we have thought about the fact that 
we have spent $245 million and probably do not have what was 
expected by a long shot.
    You know, the years it has taken to implement it. It is not 
fully implemented yet.
    It is not an area I think the Department is particularly 
proud of but they have, so far as I have asked questions about 
it, asked the same kind of questions, should we continue this? 
I mean, why don't we go in another direction?
    I have continued to be advised that, no, we have looked at 
it and the cost/benefit of continuing with the full 
implementation of CAMS as opposed to starting over or going in 
another direction, my team continues to tell me we should fully 
implement CAMS.
    Mr. Wolf. These are the last two questions. Mr. Serrano has 
to go and I will just ask these last two, and I will submit a 
number of others for the record.

                             Telecommuting

    Last year, I put an amendment on the Transportation 
Appropriations Bill to mandate telework. We used the Bill for 
two teleworking programs.
    One, we set up five pilot programs, the first one in my 
area, northern Virginia area; one is in Houston, Texas; one in 
Denver; one in Los Angeles; and one in Philadelphia.
    It does the following:
    It says that if you as a company--and I would urge the 
Administration to really take a close look at this, because I 
think you are being pounded unfairly on the environmental 
issue--it says that if you as a company allow your employees to 
telework, you will get a pollution credit, because you are 
taking pollution out of the air. And you can sell that 
pollution credit for a value on the Chicago Merq, if you will.
    We are the second most congested region in the nation, and 
teleworking is one of the solutions. AT&T has 50-some-percent 
of their people, mid-level managers, who are teleworking.
    That is a carrot program in the private sector, and I do 
not know where you are from in Texas, but Houston is excited 
about it. My region is excited about it, and the other three 
are also.
    In the public sector, since we do have that responsibility, 
we have mandated, because we initially had language 
recommending it, and nobody was moving.
    Secretary Evans. Yes.
    Mr. Wolf. Even GSA, who had the program, was not moving.
    We set up some telework centers around the region where 
people come and go there rather than in the office and they 
work relatively well, but telework centers are almost like 
black-and-white televisions.
    If you went out to buy a television, you would not buy a 
black-and-white television. You would buy a color television, 
maybe even a digital one if you could afford it.
    We have now mandated it. So now the federal government is 
mandated it at the end of the first year or this year 25 
percent of those who are eligible, 50 percent next year, 75 
percent the third, and 100 percent the last year.
    Now, one of the keys is eligibility, and some of the 
agencies are playing a little fast with the definition of 
eligibility.
    They say, well, we have got ten people who are eligible, 
and we have got two that are teleworking. We are more than 
meeting the--well 40 to 60 percent of the jobs in this region 
are teleworking jobs. The productivity is actually very, very 
high. Some even say it is higher. But, you can check with AT&T.
    Secondly, to give women an opportunity who may want to be 
home for a portion of the day, come in early, leave in mid day 
to be home, get online, because, you know, the American family, 
we are having a tough time with the American family. People 
just do not have enough time to spend with their kids.
    So, it helps people. It helps people who are handicapped, 
someone who just had a major operation who wants to come back 
to work but yet cannot come in every day.
    So it is now the law. We are asking for a report by the end 
of the first year. I am not going to ask you how you are doing, 
because you are brand-new. But I would ask you to commit, 
because I know the people that are responsible in your agency 
are going to listen to what you say.
    I worked for a Cabinet Officer. When Mr. Morton would 
speak, generally, not always, but generally it would get done.
    If you could let the word go forth that, both from clean 
air, from productivity, from good for the family, but it is a 
law to get Commerce to really get excited about this so we can 
meet the goals of 25, 50, 75, 100.
    That is not above the people but of those who have jobs 
that allow them to telework one day a week.
    Secretary Evans. I want to tell you how we are doing.
    Mr. Wolf. Good.
    Secretary Evans. You may not want to ask me, but I will 
tellyou anyway.
    Mr. Wolf. No, I am ready.
    Secretary Evans. We are doing well. We have 4,392 people 
that are involved in the program.
    We have PTO telling us their productivity of teleworkers is 
higher than those that are not in the program.
    NOAA has a total of seven centers, I think, two in your 
District, that are telecommuting centers.
    So you have a bureau in Commerce that is very enthusiastic 
about it. The results are good, and we are going to continue to 
push it.
    Mr. Wolf. Good. The last question and the others we have 
submitted for the record.

                  Communist Chinese Military Companies

    For the past years Congressman Cox in particular pressed 
the Clinton Administration to publish a listing of Chinese 
People Liberation Army-controlled firms operating in the United 
States.
    The Administration was not compliant, so Mr. Cox had 
language inserted in the Defense Authorization Bill for the 
past few years that was signed into law requiring the 
Administration to furnish a report to Congress.
    My understanding is that the Administration and Secretary 
of Defense never--and it was Defense, not Commerce--produced 
the report.
    The FY 2001 Defense Authorization Bill states in Section 
1231, quote:
    ``Not later than March 1, 2001, the Secretary of Commerce 
shall make a determination of these persons operating directly 
or indirectly in the U.S. or any of its territories and 
possessions that are communist Chinese military companies and 
shall submit a list of those persons in classified or 
unclassified form to the following,'' one being the Secretary 
of Commerce.
    Has the Department of Commerce received a list of the 
Communist Chinese military companies that are operating 
directly or indirectly in the U.S. or any of its territories?
    Secretary Evans. Mr. Chairman, not that I am aware of. I am 
not aware. We will get back to your office.
    [The information follows:]

              List of Communist Chinese Military Companies

    The Department has not yet received the list required by 
Section 1233 of the National Defense Authorization Act for 
Fiscal Year 2001 from the Department of Defense.

    Mr. Wolf. We also received a copy--saw a copy of a memo 
written by the Defense Intelligence Agency stating why the 
Department of Defense did not want to produce such a report.
    It states, and I quote.
    ``DIA believes that the questions on Chinese commercial 
entities operating in the U.S. would better be answered by the 
FBI and the Department of Commerce.''
    Could you take a look at this to see what role the 
Department of Commerce may very well play?
    These are companies that are using slave labor and 
competition to American companies that are trying to play fair.
    Could you see how the Department of Commerce could 
cooperate in that?
    Secretary Evans. Indeed, I will, Mr. Chairman.
    Mr. Wolf. Good. The rest we will just submit for the record 
unless Mr. Serrano has one last question.
    Mr. Serrano. No.
    Mr. Wolf. We appreciate very much your testimony. We look 
forward to working with you and I think we will have a good 
working relationship.
    Secretary Evans. Thank you, Mr. Chairman. I appreciate it. 
I enjoyed it.
    Mr. Wolf. Thank you very much.
    Secretary Evans. Thank you, Congressman.



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                                            Thursday, May 10, 2001.

                   UNITED STATES TRADE REPRESENTATIVE

                                WITNESS

ROBERT B. ZOELLICK, UNITED STATES TRADE REPRESENTATIVE
    Mr. Wolf [Chairman, presiding]. Welcome to the Committee. 
We had a vote. I am sorry I am late.
    Let me just say we welcome you. I recognize Mr. Serrano for 
any comment he may want to make.
    Mr. Serrano. Welcome, and I am looking forward to your 
testimony.

                Opening Statement of Ambassador Zoellick

    Mr. Zoellick. Thanks, Mr. Chairman and Representative 
Serrano.
    I want to begin by thanking all of you to give me this 
opportunity. I know it is a hectic time for you, and I look 
forward to working closely with all of you in the days and 
months ahead.
    I am pleased to report that, in the Administration's first 
months, we have been able to launch negotiations on the Free 
Trade Area of the Americas, made progress on bilateral free 
trade agreements with Chile and Singapore, and have resolved 
productively a number of disputes with our trading partners.
    Yet, we should not let this progress mask a more troubling 
reality. The United States is falling behind in the trade 
world.
    Globally, there are 130 free trade agreements. The United 
States is a party to just two, with Canada and Mexico--NAFTA--
and the other with Israel.
    The European Union has free trade or special customs union 
agreements with 27 countries, 20 of which it has completed in 
the last ten years.
    The EU has negotiated another 15 accords right now. Last 
year, the European Union and Mexico, the second largest market 
for American exports, entered into a free trade agreement.
    Japan is negotiating a free trade agreement with Singapore. 
It is exploring free trade agreements with Mexico, Korea, and 
Chile.
    We have no one to blame for falling behind but ourselves, 
and there is a price to pay for our delay.
    As Senator Graham of Florida has pointed out, during the 
last century, when it came time for countries to adopt 
standards for the great innovation of that era, electric power, 
Brazil turned to European models, because the United States was 
not active in Brazil.
    So, when you visit Brazil, be sure to bring an electric 
adaptor.
    Brazil is making decisions today about autos and other 
products, so the United States needs to decide whether it wants 
to stand on the sidelines again.
    Our inaction hurts American businesses, workers, farmers, 
as they find themselves shut out of many preferential trade and 
investment agreements negotiated by our trading partners.
    Congressman John Tanner has summed up the big picture 
stakes to me as effectively as anyone when he said, ``America's 
place in the world is going to be determined by trade alliances 
in the next ten years in the way that military alliances 
determined our place in the past.''
    In any discussion of future free trade agreements, we need 
to highlight the benefits of previous accords.
    Together, NAFTA and the completion of the Uraguay Round 
have resulted in higher income and lower prices for goods with 
benefits amounting to between $1300 and $2000 a year for an 
average family of four people.
    Trade barriers hurt families. When trade is restricted, 
hard-working families and fathers and mothers pay the biggest 
portion of their paychecks for high-cost food, clothing, and 
appliances imposed through taxes on trade.
    Increased trade supports good jobs. In the five years 
following the implementation of NAFTA, employment grew 22 
percent in Mexico and generated 2.2 million jobs.
    In Canada, employment grew ten percent and generated 1.3 
million jobs.
    In the United States, employment grew by more than seven 
percent and generated 13 million jobs.
    The Administration will also be monitoring closely 
compliance of trade agreements as well as insisting on 
performance by our trading partners.
    Thanks to the help of the Congress, and particularly this 
Committee's help, there was an initiative last year through 
which USTR advanced its ability to have additional staffing so 
we could pursue a two-track strategy of negotiatingagreements 
and ensuring that the terms of these agreements are fulfilled.
    The Bush Administration is promoting free trade globally, 
regionally, and bilaterally.
    By moving on multiple fronts, we can create a competition 
in liberalization that will increase U.S. leverage and promote 
open markets in our hemisphere and the world.
    The Free Trade Area of the Americas provides a framework 
for the Administration's hemispheric strategy.
    This area, once completed, will be the largest free market 
in the world covering 34 nations and over 800 million people.
    The draft text that we developed for this agreement is now 
going to be released in the four official languages of the 
FTAA.
    That is an important and, perhaps, unprecedented step to 
build public awareness and support an open process.
    The commitment to free trade was also made in tandem with 
an unambiguous pledge to support democracy. The summit leaders 
agreed that the unconstitutional alteration or interruption of 
the democratic order in a state of the hemisphere would 
disqualify that government from further participation in the 
Summit of the Americas process.
    We are also pursuing a free trade agreement with Chile, and 
part of our emphasis on that was to send a word to the rest of 
the world that the United States will reward good performers.
    Chile has been at the forefront in Latin America in terms 
of liberalizing trade while setting an example to the world of 
a free people reclaiming their democracy and making the 
transition to a mature, developed economy.
    Leaders from other nations in the hemisphere have now told 
us that they want to pursue free trade agreements with the 
United States.
    We will consider each of these offers seriously while 
focusing on the FTAA.
    We are also pleased to have made progress on a number of 
trade disputes.
    Last month, we settled the U.S.-EU banana conflict, one 
that had been outstanding for about ten years.
    We have also worked through the WTO and the NAFTA 
arrangement to be able to solve problems with Greece on piracy 
of U.S. films and television programs, Mexico on agriculture 
products, and India on agricultural, textile, and other 
industrial products.
    My statement, Mr. Chairman, also outlines our legislative 
agenda, but I will just move to the final point on our 
budgetary issues.
    That, as I assumed this position three months ago, I have 
been most aware that our primary resource and the one that most 
of our funds goes to is for the dedicated and committed USTR 
staff.
    Although it is one of the smallest agencies in the federal 
government with only 203 authorized full-time employees, it has 
a special record of achievement.
    It certainly makes up what it lacks in size with a spirit 
of cooperation that I have seen extend to the Congress, other 
agencies, and the private sector.
    So, I am very proud to have this opportunity to serve with 
such an exceptional group of public servants.
    I believe our FY 2002 budget request of $30.1 million and 
203 full-time equivalent staff, which represents a funding 
increase of 2.2 percent, is a reasonable one.
    It does not involve any additional personnel. It will allow 
us to continue to bring USTR resource levels in line with our 
extensive responsibilities and workloads.
    The $645,000 funding increase proposed for next year will 
help us meet the rising cost of doing business, chiefly from 
expected inflation and the scheduled January, 2002 employee pay 
raise.
    We are not proposing any major funding initiatives or 
increases from the FY 2001 appropriation level.
    Most of this, as I said, will focus on our most valuable 
asset, the 203 employees that we have, on achieving the trade 
objectives that I have outlined for you this afternoon. Thank 
you.
    [The complete statement follows:]


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    Mr. Wolf. Thank you very much. We are going to have a 
number of budget issues, but I think your budget is reasonable.
    The Committee looks forward to working with you in the 
coming years. I just wanted to make a couple of personal 
comments.
    When I read your testimony last night, I was struck by the 
fact that you never mention the word human rights in that 
testimony at all.
    You had a comment about environmental and labor, but there 
was no mention of human rights. Not one, which was kind of 
glaring to me, unless I missed it.
    It was late at night as I was going through it, and, if I 
missed it, let the record be corrected.
    But, secondly, I consider myself a free trader, too. I 
voted for NAFTA.
    I was opposed to PNTR and still am. I get a little 
concerned when I have seen some of your statements and some of 
other people in the Administration.
    Be careful that you do not drape this moral imperative 
cloak over your position. I do not know that there is a moral 
side on this issue.

                            CHINA RELATIONS

    But, be careful, because, when I saw that one comment, I 
got a little--because I will tell you, when you talk about 
China----
    Well, let me give you a quiz. How many Catholic bishops are 
in jail in China today?
    Mr. Zoellick. I am afraid I do not know, Mr. Chairman.
    Mr. Wolf. But I think you should probably know that, 
because you are the Trade Rep.
    There are 12 that were in there up until Good Friday, and 
two who were arrested on Good Friday are now in jail.
    How many Protestant House Church pastors do you think are 
in jail today?
    Mr. Zoellick. I do not know, but I will say, Mr. Chairman, 
that I did attend with the President's father a christian 
service in China in 1989 to emphasize the importance that I 
think we both hear about religious freedom.
    Mr. Wolf. But that was to recognize House Church. Have you 
ever been in an underground church?
    Mr. Zoellick. No, sir.
    Mr. Wolf. How many times have you been to China?
    Mr. Zoellick. Oh, I don't know. Maybe six or seven times. I 
have not been in China since I took office.
    Mr. Wolf. Have you ever asked to meet with any of the 
dissidents?
    Mr. Zoellick. I met with dissidents when I was there with 
the State Department, yes.
    Mr. Wolf. Have you ever been in a Chinese prison or slave 
labor camp?
    Mr. Zoellick. No, sir.
    Mr. Wolf. I was in a slave labor camp. We picked up--socks 
off the production line. We saw Tienanmen Square demonstrators 
making socks for export to the U.S.
    Have you been to Tibet and seen how many monasteries they 
have destroyed in Tibet?
    Mr. Zoellick. No, sir.
    Mr. Wolf. It is about 3,000 to 4,000. They are doing the 
same thing to the Muslims.
    I just get a little bit concerned when I see the statements 
that this is the moral imperative, that, if you are not on this 
side, you are not moral.
    Now, I do not know--I do not know what side I am going to 
be on on your fast track, or whatever you call it.
    I am going to make up my own mind based on my own 
conscience, but I think it would be wrong if I drape my 
position in a moral position. Mr. Zoellick, you know, morally 
there are 14 Catholic bishops, so you ought to be facing this 
issue, or Protestant pastors, or slave labor--more slave labor 
camps in China today than there were when Solzhenitsyn wrote 
the book, ``Gulag Archipelago.''
    So, really be careful. There are going to be good men and 
women who differ on these issues--people of conscience, people 
of faith who are driven to their position, not for political 
reasons, not because their Districts tell them to, but because 
their conscience tell them to and their faith.
    So, all the statements, or a lot of the statements that I 
have really, really seen have just made it look like this is 
the moral----
    Do you believe that this is the moral position?
    Mr. Zoellick. Actually, Chairman, I do not believe I used 
such words. I think the President did.
    So, you know, I am sure that is an important issue overall.
    I do believe, Mr. Chairman, that you may find there is some 
more common ground on this than you may suspect.
    I believe, for our trade policy to be effective, it has to 
be rooted in our overall values.
    Mr. Wolf. I agree.

                   HIV AIDS AND INTELLECTUAL PROPERTY

    Mr. Zoellick. I believe like you do, that there can be 
differences about how the process works.
    But, even on a very early issue that I faced was the 
question of whether we would maintain the flexibility of our 
policy on HIV AIDS in terms of dealing with intellectual 
property.
    One of the reasons that I moved very quickly to emphasize 
we would was because I felt that, if we did not have a good and 
flexible position on something that was a pandemic to try to 
help people in Africa and other places of the world, it would 
be very hard to sustain support for trade.
    I said, in a testimony on Tuesday for the House Ways and 
Means Committee, that I was very interested in trying to follow 
through on the ILO's findings dealing with forced labor in 
Burma.
    I mentioned that one of the first things when I check into 
that, I talked with my colleague from the European Union about 
whether we could do something cooperatively on that.
    I learned subsequently that Un Fung Su Che had actually 
been in a series of discussions where she had asked not to move 
forward.
    But, I regularly ask my people to make sure those 
discussions are going forward in some fashion.
    We do not just let it slip, so I--you know, I actually 
share a belief that one of the reasons why trade is important 
is economic growth.
    But, it is also the openness, and I certainly believe in 
trying to work through the trading system and parallel to it to 
try to promote that.
    I certainly agree with you. You gave me a book about this 
to read in terms of the Chinese context.
    I looked through the book and looked through the 
conclusions in particular about policies to take.
    I think our policies towards China parallel very closely to 
the recommendations there at the end, including the treatment 
of a democratic Taiwan.
    So you have a chance to know where I am coming from, I do 
believe that those are important issues--important as a country 
but also important for us to sustain the trading system.
    Mr. Wolf. Well, I agree with you, and I think the position 
that I heard President Bush take, so far, have been very, very 
positive.
    I mean, he has spoken out very, very forcefully. The speech 
he gave last week, which I read, was very, very positive.
    I do not want to take issue or get into a big debate. I 
just wanted to make that clear.
    I guess the one country that I have problems with with 
regard to China--and everytime I hear people saying how trade 
changes--I do believe it does change, and I believe it is 
positive.
    But, I believe there are some potential exceptions, and 
Ronald Reagan, who I think was one of the finest Presidents we 
have ever had, never gave MFN to the Soviet Union.
    You were around then, if you recall, in 1986, Reagan signed 
the Bill to take away MFN from Constantinescu, the government 
of Romania, for the persecution of the church.
    Now, if we look at what China is doing versus what Romania 
is doing, Romania did a lot of bad things, but not to the 
degree that China is doing.
    So, I just think it is a tough issue, and there are going 
to be people coming at it from different points of view.
    They are all good people, and I am not saying that my 
position is the right position or the only position. I do think 
we have to be careful how we phrase it.
    Mr. Zoellick. I think, honestly, it would be interesting to 
see if you find something I said that meets it, because I 
basically agree these are tough issues.
    I mean, I was in China the first time in 1980 when I lived 
in Hong Kong.
    On the one hand, I think both you and I would agree there 
has been a transformation in terms of openness.
    But, I have also meet dissidents, and I was in the Soviet 
Union before the end of the Cold War and saw the 
transformation, saw what was hid behind these countries, and 
things like that.
    So, I mean, I do not approach this in any sort of blind 
sense about what totalitarian communist societies can do.

                          MEXICAN TRUCK SAFETY

    Mr. Wolf. I appreciate that. One other issue it deals with 
is the issue of truck safety, and then I will recognize Mr. 
Swerrano.
    I did vote for NAFTA and understand what goes with it. The 
number of deaths--there are over 5,000 people a year--5,335 
last year that were killed in accidents in the United States 
with trucks.
    I have been out on four truck inspections in northern 
Virginia.
    In every one, 20-some, 25, 26 to 43 percent of the trucks 
that were inspected were taken off of the road because they 
were so dangerous.
    Mexico does not have an hours-of-service law. You are going 
to have 12,000 to 13,000 carriers that are asking for requests 
to come across the border.
    Mexico has no truck inspection program. Mexico, unless they 
implemented it within the last two months, has no drug testing 
program.
    We are having a hard enough time in the United States. I am 
not saying it cannot be done, because, coming out of Canada, it 
has been successful.
    I believe that, if that is not done very, very carefully--
and I do not believe that it is being done as carefully as it 
could be done--I think it will result in a lot of accidents.
    There was a trucking company south of my area that the IG 
was investigating. The guy had gone from California to southern 
Virginia in 48 hours, had several bottles of urine in the cab, 
and had not even stopped, violating the hours-of-service rule.
    I think it is going to be a very, very difficult and a 
very, very tough issue.
    Also, there is real concern very few of those trucks will 
actually be inspected. I am very much concerned with regard to 
contraband--drugs coming across the border.
    So, I do not know if you want to comment on it. I think 
there are insurance problems, to make sure that the carriers 
all have an American insurance company, so that, if someone 
from California or Texas or Arizona or Virginia is involved in 
an accident, that there is is ability to recover.
    But, it is a very tough issue. Also, the money that you 
have asked for increased inspections really is kind of a funny 
money either way.
    You take it out of the Realigned Budget Authority, which 
really does not count, and I think it would be more sincere if 
the money for the increased truck inspections at the border, 
particularly for safety reasons, came out of the appropriate 
funding whereby we were sure that there would be money for the 
Transportation Appropriations Committee to fund it.
    But, do you have any comments about this truck issue coming 
out of Mexico now?
    Mr. Zoellick. Well, let me tell you my understanding of it 
is that, as you know, this relates to the Department of 
Transportation and Department of Labor regulations.
    My understanding is that the Department of Transportation, 
in the past week or so, published a notice of proposed 
rulemaking.
    So, they are going to go back and examine the whole 
rulemaking structure related to safety for U.S., Canadian, and 
Mexican drivers.
    Indeed, I think we all agree that, in some ways, it is a 
smaller version of your first case.
    If this is going to be successful, it has got to have the 
top safety standards we can, because we all know that, if you 
have accidents, it could be used to undermine the overall 
relationship in commerce.
    So, that rulemaking process, my understanding is, is likely 
to take much of the course of the year.
    I just had a meeting this week with my Mexican counterpart, 
and I mentioned that the key for us in moving forward was going 
to have to be safety.
    My understanding and the rulemaking process starting out 
with a notice of proposed rulemaking, as you notice, is to 
actually try to identify all those issues, get a chance for 
people to comment, and sort of work on them.
    I do think it is good that the rules apply equally to all 
three parties.
    I know, from talking to Secretary Chao, that there will 
also be labor issues related to this in terms of the standards 
for the Mexican drivers as part of it.
    I also understood there was to be a shift of--I forget 
whether it is about $85 million or $86 million to the border to 
try to improve the inspections process.
    I had not known about the point you mentioned about the 
shift of money.
    You obviously would know that better than I would, but I 
certainly will check on it.
    I thought it was real money. It is not--as you know, my 
budget is $30 million. It is much bigger than that.
    But, it is a point we will certainly be pleased to check 
on, because I think all of us agree you have got to have real 
inspections.
    So, I just do not know the financial part other than I 
thought there was money allocated.
    Mr. Wolf. It would be helpful if you really kind of got 
into it.
    I mean, it is inevitably probably going to happen, but I 
think how it happens is very, very important.
    I was also told--and I do not know the answer--maybe you 
would--someone told me they use leaded gasoline in Mexico. Do 
they? Do you know?
    Mr. Zoellick. I know they used to use leaded gasoline in 
Mexico.
    But, I know that they have had a major transformation of 
that as part of their effort to clean up their air, so I do not 
know the status.
    Mr. Wolf. Because that would be a problem if they use 
leaded gasoline and they come across the border.
    You cannot put unleaded gasoline in for a period of time, 
or you ruin the vehicle's system. How you would work that out?
    Mr. Zoellick. I do not even know how they would work, then, 
because, in a sense, they are going to have to refuel the 
trucks at some point, but I do not know, but we will be pleased 
to check.
    Mr. Wolf. Okay, fine. Mr. Serrano.

                   moving ustr from cjs jurisdiction

    Mr. Serrano. Thank you, Mr. Chairman. Let me just, as an 
aside--I understand that you are in support of the 
Administration's proposal, which basically would move you out 
of the Subcommittee, take our jurisdiction away to oversee your 
agency, is that correct?
    Mr. Zoellick. Well, there is an amendment that has been put 
up to do a consolidated budget for the Executive Office of the 
President.
    At least, my understanding is that has not been fully 
determined what it would make the role with the Subcommittee.
    I am obviously pleased to work with whoever in the Congress 
people believe I should work with.
    So, the logic of that----
    Mr. Serrano. I just thought that maybe you were saying that 
you are here asking for help and then wanting to break up with 
us. [Laughter.]
    We are very sensitive people on this Subcommittee. 
[Laughter.]
    I will let you off the hook on that one.
    Mr. Zoellick. Thank you.
    Mr. Serrano. Let me ask you a question. You are not 
requesting any increase in staff.
    With your ongoing activities and all the new trade bills 
that have been passed recently, how do you expect to do 
everything?
    If I was to copy the style of my former Chairman, Mr. 
Rogers, who always asked the Clinton Administration officials--
you remember that--if they were being put up to this by OMB, 
did you ask for more and did OMB shoot you down?
    Mr. Zoellick. No, no, Mr. Serrano. I appreciate you asking.
    I will say this. You know, I have been in the government 
before in different--State and Treasury and Justice Department 
and the White House.
    I do have to say it is quite impressive--it is not me--it 
is my predecessors and others--what USTR does with a pretty 
small group of people.
    It is probably the culture of the institution, and, you 
know, like anything like this, it has got its good and its bad.
    The good is that people feel pretty empowered, and so the 
career people see their responsibilities in terms of working 
with international counterparts, private counterparts, the 
Congress.
    That is all a good aspect to things. My own view on that, 
in particular, is that, as you know, the Congress allocated us 
another 25 slots as part of the legislation you passed dealing 
with China.
    We have not totally filled those slots. We filled about 11 
of the 25.
    We expect to get the rest done by June 30th. A number of 
those--13 of those are for added monitoring and compliance, 
which I think is important.
    It may just be a little bit of fiscal conservatism, but it 
struck me the logical course would be to fill those slots, see 
how we are doing, you know, and then making sure----

                           unfilled positions

    Mr. Serrano. Do you know how many are unfilled?
    Mr. Zoellick. Well, of the 25, we have filled 11, and we 
expect to have all 14 done by June 30th--the other 14.
    Part of this was, is we--I have been on board now about 
three months.
    One of the first things we did is looked at the allocations 
and double-checked those.
    As you know, there is a posting process and others, so we 
need the people, but my sense was we ought to try to digest 
that first.
    In terms of the money, as you can tell, in part because the 
hiring was a little slower, we took some of those----
    We had some added expenses we did not expect in terms of 
some of the one-time payments for some of the departing people 
from the Clinton Administration.
    I presume that was for various accrued leave and some 
unemployment compensation.
    So, we had to pay a little bit more for that, and the 
federal government pay raise was a little higher than it had 
been in the budget before.
    So, we used some of the personnel savings for that, and we 
carried over, I think, it was about $350,000, or something of 
that----
    So, we are trying to use that money efficiently, and, in 
general, my belief is I will not be afraid to ask for 
additional resources, but I think we should do it based on our 
record.

                             digital divide

    Mr. Serrano. Okay. Whenever we speak to the folks fromthe 
Commerce Department, we always spend time discussing the whole digital 
divide issue in this country.
    Certainly, on the international level, I am sure that it, 
perhaps, is even a more serious issue.
    So, what would you say are the hot e-issues in the trade 
world these days?
    Mr. Zoellick. That is a very good question.
    I have met with the High Tech Committee on a number of 
occasions already, and the way that they have been framing it 
for me--and I think this is an interesting application of the 
private sector and the government world--is to look at this as 
the value chain as you would in a business performance.
    So, then, try to pose that on the trade world and say what 
are the things that have to be done in trade liberalization to 
ensure that you are able to get the benefits of e-commerce.
    So, that would include things like the basic 
telecommunications liberalization, enhanced telecommunications 
liberalization, make sure you do not have undue restrictions, 
whether it is due to extra taxes or tariffs on electronic 
commerce, delivery services.
    One of the other issues that we will be working, I am sure, 
for quite some time with the EU is the whole question of data 
privacy, because, as you know, many of these businesses 
basically take this additional computer capability----
    The way they talk about it is to go from data to 
information where it can be transformed to marketing purposes, 
hence why we all get the different things we get in the mail 
now.
    There, frankly, has been a different culture in this in 
Europe and the United States in terms of the availability of 
that information.
    So, one of the things that will be interesting about this 
is, as some of the new types of ways of doing business, we will 
take systems that people used to consider primarily domestic 
regulation and see how they interact with one another.
    Frankly, my predecessors in the Clinton Administration 
tried to develop a safe harbor on some of these privacy issues 
with the EU.
    There has been a question over the past month about how 
that is related in the financial area.
    You know, again, as the Chairman said, on some of these, 
there is no right and wrong.
    I mean, I remember actually ten or 20 years ago there were 
discussions in this Congress about dealing with financial 
privacy issues and the Financial Privacy Act.
    So, in terms of electronic commerce, it covers everything 
from basic telecom, enhanced telecom, delivery services, and 
some of these newer issues.
    Mr. Serrano. Okay, but you are confident that we are moving 
in the direction of dealing with them as quickly as possible?
    Mr. Zoellick. It is high on my agenda, and I believe that 
it is important to not only American businesses who are often 
in the lead of this but I think it is important to consumer 
services all throughout the world.
    Mr. Serrano. Right. Let me ask you a couple of other 
questions.

                            trade with cuba

    I have two questions, and I will bunch them together, on 
the Helms-Burton legislation.
    First, Title III allows U.S. nationals to pursue those who 
traffic in Cuban property or confiscated it from them for money 
damages in U.S. Federal Court.
    It extends this right to sue to Cuban-Americans who became 
U.S. citizens after their property was confiscated.
    The law includes a provision giving the President the 
authority to delay implementation of this Title for six months 
at a time.
    As you may know, President Clinton chose to exercise his 
authority.
    Do you expect that this summer President Bush will renew 
the waiver of Title III of Helms-Burton?
    Second, on Title IV, which denies admission to the U.S. to 
aliens involved in the confiscation of U.S. nationals' property 
in Cuba or in the trafficking of such property.
    This provision is mandatory and applies to corporate 
officers and their spouses and children as well.
    Do you expect President Bush to move forward with the 1998 
agreement between the U.S. and the European Union, in which the 
EU agreed to suspend their WTO complaint against the 
application of Helms-Burton in exchange for the United States 
seeking authority from Congress for the President to waive 
Title IV of Helms-Burton?
    Mr. Zoellick. I am not intending to duck this other than to 
say that I believe that is an issue that the State Department 
normally manages.
    So, I do not have a clear answer in terms of the waiver 
point.
    On the second issue, my understanding is that the accord 
with the EU partly depends on our nonapplication of it.
    I do know that there is at least some case under decision 
now, because I read about it, that may raise a question about 
being able to continue that.
    But, I do not know the exact status of it, but we would be 
pleased to check with the State Department and get back with 
you.
    Mr. Serrano. Well, let me ask you, on the first part, Title 
III, even though you say it is a State Department decision, 
what would be your advice to your colleagues in the 
Administration?
    You know, many people have always said that the reason 
President Clinton had to waive this is because, otherwise, it 
would just present a major stumbling block to our situation 
with a lot of different countries that we deal with.
    What would be your advice, if you could tell me that much?
    Mr. Zoellick. What I can say on that one is that, you know, 
having followed it from the outside, I know that this is a 
piece of legislation that, on the one hand, is deeply felt in 
the United States and, on the other hand, is very 
controversial.
    So, my understanding is that Stu Eisenstat, when he was 
both at the State Department and later at the Treasury 
Department, helped negotiate this arrangement, which seemed to 
be a constructive one, which led to the waiver process.
    So, I know of no plans to change it. I just cannot speak 
for the Administration directly on that issue.
    Mr. Serrano. Okay. I would hope that you would take a very 
close look at this and develop ways we can continue to waive 
this.
    We are not going to discuss it here, but I am sure you know 
how I feel about our whole policy towards Cuba.
    Here we are spending a lot of time talking about how we 
will continue to trade with China and how we still cannot 
figure out how to do this.
    Ironically--and I will close with this so that other folks 
can make some comments or questions--ironically, it was this 
President's father who advised our last President not to sign 
Helms-Burton, because he thought it would tie up the 
President's ability to handle foreign policy, and my favorite 
President did not listen.
    Mr. Zoellick. Well, that is probably a higher source of 
authority than any one I can provide.
    Mr. Serrano. Thank you. Mr. Miller.
    Mr. Miller [presiding]. The Chairman stepped out for a few 
minutes. Thank you for being here, Mr. Ambassador.
    I am a free trader but support the further trade concepts. 
Also, I am supportive of most trade legislation coming our way.

                      agricultural trade subsidies

    However, I have concerns about agriculture issues, and what 
I am concerned about is that trade--our arguments about unfair 
trade practices are giving a justification to create what I 
think is like an agricultural welfare system in our country.
    I do not know if you saw an article in this morning's 
front-page Washington Post about apples.
    I mean, just use an apple as an illustration. I mean, they 
are coming now. They said they need $500 million to subsidize 
the apple program because of unfair trading practices.
    You can make that argument with a lot of different products 
in this country.
    The argument is that, well, it is not fair elsewhere around 
the world, and, you know, how do you argue that point?
    I mean, we are subsidizing--if we give them $500 million, 
we are subsidizing them one way or--isn't that a subsidy?
    I mean, it is not a direct subsidy, but it is $500 million 
to the apple-growers.
    How do you make trade fairer for our agriculture products 
and not justify these--you know, this huge agriculture bill?
    A lot of our farmers now--half the money is coming from the 
federal government. It is the welfare system.
    Mr. Zoellick. Well, first, you will be pleased to know that 
the area that President Bush emphasized to me the strongest 
when he interviewed me for the position was agriculture.
    It is one that he feels is vital for us with our overall 
trade policy.
    Second, I met with, I don't know, maybe 70 or 80 different 
agriculture groups starting out, because I think that this is 
going to be important for the U.S. economy and also for our 
overall support of trade.
    Just to echo some of your points, you know, I discovered 
that about 25 percent of gross farm income is from our overseas 
exports.
    About one out of every three acres planted is for overseas 
exports.
    If you think about it as a business proposition, there's 
only so much more food that we can eat, although I test it 
every day.
    In that context, the growth is going to be abroad, and so, 
when you get farmers down and sort of really see the benefits, 
they see that it has to be involving open markets.
    Now, then, that takes to the subsidy question, and here, as 
you know, the United States has basically tried to distinguish 
among different types of subsidies.
    One is we have been very vigorous on the export subsidies, 
because, in part, what the European Union has done is they paid 
people to grow food, then they cannot use it all, then they 
have to pay people extra to sell it.
    That is particularly nefarious, you know, not only to us 
but developing countries.
    Then, there is the question about subsidies in terms of 
your internal system.
    Here, what we have tried to do with other countries is to 
build in discipline so that, if countries feel they have to 
subsidize farmers, that at least it does not increase extra 
production.
    So, it is the de-linking of the income payments for 
production, because we want to avoid the situation where the 
Europeans pay their farmers to grow a bunch of food.
    It is inefficient. Then, they have to pay them to sell it.
    So, I think whatever course, you know, the Congress decides 
to take in terms of agricultural policy it is very important 
that it maintain that principle, because, otherwise, we are 
going to have a very hard time trying to negotiate with people 
abroad for them not to subsidize additional production.
    Mr. Miller. Well, I do not know if you are following this 
agriculture reauthorization issue.
    I mean, I know you have some involvement, but I think what 
little I know about it right now--I am not on that Committee, 
but, I mean, we are moving over the line.
    I mean, we are going to give $500 million to apples, and I 
am going to talk about sugar in a minute, which is a different 
issue entirely.
    But, I mean, it is going to be hard for you to go negotiate 
and have clean hands when, you know, we have this huge federal 
subsidy, or however you want to describe it.
    But, it is a huge amount of money now that is flowing out 
of Washington and will be flowing out to subsidize certain 
agriculture, mainly in the midwest.
    I mean, Florida does not get--and all of a sudden everybody 
said, ``Wait a minute, you know, they get it all in Illinois 
and Iowa. Why don't we get more in Florida, or why aren't we 
getting it out in Washington state for the apples and all 
that?''
    So, I mean, everybody is starting to grab for that, and I 
am not sure--I mean, you are going to have a harder time----
    Let me just switch over to sugar, which is an issue that I 
have been fighting that program for quite some time.
    We had our last big fight over this in 1996, and it is a 
bipartisan issue. It is not a partisan issue.
    An argument is it has cost jobs in this country, well, the 
reason the Mayor of Chicago and the City Council supported 
getting rid of the program, which is kind of unusual to have 
Mayor Daley and the City Council say the sugar program should 
go because they are losing jobs.
    They are the candy capitol of the country, and these candy 
companies are closing down and moving out--moving elsewhere in 
the country.
    You can go to Canada and get sugar for half the price, so 
how do you----
    How are you going to negotiate with other countries like 
Chile and say, ``Oh, we are going to negotiate and have free 
trade, but, oh, don't touch our sugar?''
    How do you do that?
    Mr. Zoellick. Well, I think you answered the question when 
you asked it.
    As you know, the sugar program is one that has a--that has 
a broad base of support, in part because there's a number of 
regions of the country involved.
    I have certainly heard about that early on.
    Mr. Miller. It is not as many regions as you think, by the 
way.
    I mean, Florida is the biggest grower, and there's only two 
members of Congress representing sugar, by the way.

                              sugar trade

    Mr. Zoellick. Well, but I will tell you what I have also--
--
    But, let me make the second point, and it builds a little 
bit on your comment.
    You know, it is interesting what happened to the soft drink 
industry in this country, is, as the price of sugar went up, 
you basically, to be efficient, people had to substitute the 
high fructose corn syrup.
    One of the interesting conflicts that I have right now with 
Mexico is they are blocking our exports of the fructose corn 
syrup.
    We want them to open it up, but, if we open that up, then 
they will have more sugar which they want to be able to sell in 
the United States, which we do not want to have.
    So, I have a feeling here more generally that I know there 
have been some changes, as you refer to them, in the sugar 
program.
    I think that this issue, whether it be in the domestic 
legislation or the international one, is coming to a point 
where we are going to have to try to reach some other 
reasonable accord here than we have had in the past.
    I have had some discussions with the sugar producers about 
that. I think some of them recognize it.
    I mean, a lot of this will depend really, you know, on how 
the Congress decides to deal with the sugar program with the 
Reauthorization Act.
    Mr. Miller. Because you mentioned earlier the program is 
encouraging inefficiencies, and that is what has happened as 
one of the reasons the environmentalists get upset with the 
sugar program is we are using less productive land near the 
Everglades to produce sugar, because the price is so high.
    So, we are overproducing sugar, and you may know that the 
federal government bought $450 million worth of sugar last 
year.
    Now, we are having to store $450 million worth of sugar 
just for last year alone, and, I don't know, another half a 
billion dollars worth of sugar.
    So, I mean, they are going to have to create a new program 
just to store sugar, I mean, because it is costing us so much 
money.
    It is already costing us $20 million, so, to store it, it 
is going to cost us more.
    But, at any rate, it is really hard for you to negotiate 
when you have got to protect a product that keeps----
    Mr. Zoellick. I will just say this, because I did not 
really answer your question.
    When we go to other countries and we want to try to open up 
their markets, it obviously makes it much harder if they want 
to take things off the table that we say that there are things 
that we want to take off the table.
    I mean, if we want to open up their market and we are 
refusing to open up ours, yes, that makes it much harder in the 
negotiation.

                            stuffed molasses

    Mr. Miller. I want to comment about stuffed--molasses is--I 
mean, you are aware of--are you following that issue at all?
    Mr. Zoellick. Yes, I at least have a slightly different 
perspective on that one.
    I mean, I think that that--you know, we have a program. We 
have laws, and I think that that is a circumvention of the 
program.
    Mr. Miller. On temporary quotas, I mean, I hope you put one 
in a timely base. Two years ago, they waited too long to put 
one into effect.
    You have to announce them by September, so, just to make 
you aware of that.
    How about Mexico wants to, under NAFTA--are you familiar 
with whether we are going to get more sugar?
    Mr. Zoellick. I am, indeed.
    Mr. Miller. But you do not want to talk about it.
    Mr. Zoellick. No, I would be pleased to talk about it. It 
is, as you undoubtedly know, since you followed this closely, 
there were a series of questions at the time of NAFTA's passage 
about the agreement and various side agreements.
    There are some disputes that we have with those with the 
Mexicans.
    I have discussed them as recently as this week. We have 
recently followed through on about another 105,000 tons of 
sugar that we felt we were obligated to provide under even our 
interpretation of the agreement.
    But, I think, in dealing with this problem, it comes back 
to the other one you mentioned.
    I think we have to try to deal with this in a longer-term 
approach as opposed to do bandaids, and that is at least what I 
have discussed with my Mexican counterpart and we are trying to 
discuss with the sugar industry here.
    Mr. Miller. Well, just to conclude that, the whole issue 
about sugar is, I mean, it hurts our environment.
    It is killing jobs in the candy company and any business 
that is--uses a large amount of sugar in their products. They 
are leaving this country because of the sugar program.
    That, as I say, the reason that the city of Chicago is 
taking that stand, and elsewhere around the country.
    It costs the American consumers a very aggressive tax. The 
poor pay more for food and have to pay more because of sugar.
    So, that is the reason there is bipartisan support. One 
final quick question, Free Trader America's secretary, Miami, I 
hope he will do what he can to make the permanent location in 
Miami.
    Mr. Zoellick. I am a strong supporter of that, and I think, 
in one of my early testimonies, was asked about it and said 
that I would be pleased to work with people that try to promote 
it.
    Indeed, the city of Miami has been going back to the budget 
question, helpful to us, and that we had some negotiations with 
the Chileans.
    The city of Miami helped to provide some of the location 
and the expenses, and I partly try to use that as an exampleof 
the support that he has.
    Mr. Miller. Thank you very much, and the Chairman is back.
    Mr. Wolf [presiding]. Thanks. Mr. Mollohan.

                         STEEL INDUSTRY CRISIS

    Mr. Mollohan. Thank you, Mr. Chairman.
    [Pause.]
    Mr. Zoellick. The Administration has indicated that they 
are aware of the steel crisis that exists out there across the 
land and are considering actions to take.
    Mr. Mollohan. You are aware--that, there have been 18 steel 
companies that have filed bankruptcy in the last three years.
    Two companies have locked their doors, 15,000 steel workers 
have lost their jobs in the timeframe.
    Between 1999 and 2001, in the last three years, it has been 
the three highest steel import years in U.S. history.
    Imports in 2000 were second only to '98. I know you are 
appreciative of this.
    Steel prices have declined significantly since May of 2000, 
and some product lines are at 20-year lows.
    The survival of our domestic-steel industry is really at 
stake, and, after 18 bankruptcies, I do not know if we can 
agree that we need to move quickly and responsibly to find a 
solution that will have a lasting impact.
    But, I am wondering. You indicated that you have met with 
the high-tech community on a number of occasions in the last 
short period of time and that you had met, I think you said, 
with 70 or 80 ag groups to gain a better appreciation of the 
concerns that they have had.
    Have you met with any of those who are concerned with the 
steel crisis that we face?
    Mr. Zoellick. Yes, and, indeed, I actually have. I will 
come back to this, but with a strong sympathy for some of 
those.
    But, I have met with a number of the integrated producers. 
I met with a large number of the mini-mill community.
    I knew George Becker of the Steelworkers before assuming 
this job, and we probably met, I don't know, four or five times 
already.
    I met some of the local unions that were related to the 
Whearton plant and some of the others, some that are not 
directly part of the United Steelworkers. I have had a number 
of meetings on this topic.
    Mr. Mollohan. Before I ask you what you are going to do, 
have you met with part of the community that would oppose the 
initiatives that the groups that you just represented you had 
met with would advocate?
    Mr. Zoellick. I have heard from them. I have not met them. 
I think Secretary Evans has.
    Mr. Mollohan. And who are those groups?
    Mr. Zoellick. That, I think, it would be better directed to 
him. I just think it is very----
    Mr. Mollohan. Well, it might be better directed to him, but 
I am asking you.
    Mr. Zoellick. But I am afraid I do not--I mean, I know 
that, in talking to him, that he expressed that he had heard 
from some of them. But, I do not know his----
    Mr. Mollohan. My question to you is what groups have you 
met with or anybody in your organization met with who would 
oppose the requests that the steel community have made to you?
    Mr. Zoellick. I do not recall having met with any myself.
    I do not know about people in my organization. It would 
probably be appropriate for them to meet with all sides, but I 
just do not know for sure.
    Mr. Mollohan. I understand, but you were telling me just a 
second ago that somebody had met with them.
    Mr. Zoellick. Secretary Evans. I had heard that, and what I 
am reflecting here is, since we have actually been working on 
this issue that concerns both of us, is that----
    Mr. Mollohan. Right, and I am asking you--is your testimony 
that you have heard that Secretary Evans has met with groups 
opposed to the prayers that the steel community have advanced 
to you?
    Mr. Zoellick. I have heard that he has heard from them, and 
I just cannot speak for the meetings.
    Mr. Mollohan. Do you know if he has met with any of them?
    Mr. Zoellick. I don't know for sure, Congressman.
    Mr. Mollohan. Not for sure. Do you know? Yes or no.
    Mr. Zoellick. To the best of my recollection, I do not 
know. I do not know.
    Mr. Mollohan. Do you know----
    Mr. Zoellick. It is hard enough--I mean, to be honest, sir, 
I am actually a strong supporter of----
    Mr. Mollohan. I am not asking whether you are a supporter 
or nonsupporter.
    I am just asking you who are these groups and have you met 
with them, and has anybody in your organization?
    You represent that you believe--you have heard that the 
Secretary met with them.
    I am asking you who are they, to your knowledge, and, if 
you are telling me you do not know what groups he has met 
with--is that your testimony?
    Mr. Zoellick. Yes, I don't know.
    Mr. Mollohan. Okay. Some of the remedies, or one of the 
remedies that has been advanced--and a month or two ago it was 
rumored that the Administration might be seriously considering 
and might even be going to move forward with a Section 201 
investigation with regard to the steel industry----
    Mr. Zoellick. That is correct.
    Mr. Mollohan. Are you familiar with that--with those 
discussions?
    Mr. Zoellick. Yes, and, indeed, I had said publicly that I 
am very sympathetic to the use of the idea.
    Mr. Mollohan. What is the status of those discussions?
    Mr. Zoellick. We have had a number of inter-agency meetings 
at a variety of levels, some coordinated by the White House, 
some involving Secretary Evans, some involving Secretary 
O'Neill, Secretary Chao, and myself.
    We are reviewing the full range of possibilities, some 
involving international actions----
    Mr. Mollohan. But, with regard to 201, I'm sorry.
    Mr. Zoellick. But the 201 is reviewed as part of an 
overall, sort of, process.
    It is seriously under consideration. As I said both 
publicly and privately, I have a lot of sympathy for the use of 
the idea.
    Mr. Mollohan. What does that mean ``for the use of the 
idea''?
    Mr. Zoellick. I think that, in general, if a 201 action can 
be combined with efforts by all parties involved to 
helprestructure the industry and move it towards a great competitive 
capability to the future, that we should strongly consider it.
    In this case, I personally think that the circumstances for 
the steel industry are such that it has a very good argument.
    Mr. Mollohan. If I might explore that, what parts of the 
steel industry's argument do you think are valid?
    Mr. Zoellick. Well, I think, as you mentioned, it is an 
industry that is in very serious economic difficulties.
    It has already gone through a significant adjustment. There 
is a question under the 201 provisions about various tests that 
have to be met related to injuries and related to their 
standards related to imports.
    Mr. Mollohan. The industry nexus with imports.
    Mr. Zoellick. Yes, but it also relates to, in this case, 
because there are a number of anti-dumping and countervailing 
duties on already, there is a question about whether that would 
affect the calculations done by the ITC, because some of this 
has actually limited imports in certain product categories.
    Some of this will also depend on the product categories 
that one looks at in steel.
    So, one of the questions that we have been examining is the 
likelihood that the ITC would find the nature of the injury so 
as to be able to go forward with it.
    Another question really goes to the different parts of the 
industry have different perspectives on this, as you probably 
know, because some of them feel that, if there is protection in 
certain categories, it will make it harder for them to maintain 
their efficiency, because there will be an additional supply 
produced by capacity----
    Mr. Mollohan. And those elements of the steel industry are 
part of the push-back group that we talked about before that 
Secretary Evans may or may not have spoken to?
    Mr. Zoellick. No.
    Mr. Mollohan. They're not?
    Mr. Zoellick. There was a--well, no, there is the mini-mill 
industry, and both Secretary Evans and I met with the mini-mill 
industry, but they are supporting the 201 process.
    Mr. Mollohan. Yes.
    Mr. Zoellick. Okay. What I thought you were referring to 
and what I just do not know is that whether they are steel 
users, I mean, for example, auto companies and others.
    Mr. Mollohan. You don't know that?
    Mr. Zoellick. Know whether they have met with him.
    Mr. Mollohan. Okay. Do you know the steel users' attitude 
toward the industry's initiatives in this area?
    Mr. Zoellick. My general sense is at least some of the 
steel users are worried about increased costs for their inputs.
    Mr. Mollohan. And that is just a general sense on your 
part? You don't know that?
    Mr. Zoellick. Well, I am saying that I have not met with 
them, so I can't represent----
    Mr. Mollohan. Well, you know, honestly, I am shocked at 
that.
    I would think that you would know that. This is, at least 
in my part of the country and with regard to the sector of the 
economy that we depend on pretty heavily, it is common 
knowledge.
    I mean, it is a part of the information backdrop that we 
all operate off of, and for you to suggest that you do not know 
that absolutely shocks me.
    It does shock me that you would just know this in the vague 
sort of way that your testimony would reflect.
    But, let me move on back to, if you will, to my question 
about 201.
    What is the status of your considerations--of the 
Administration's consideration with initiating a 201?
    Mr. Zoellick. It is one of the options that we are 
examining.
    Mr. Mollohan. And in what timeframe are you considering 
this option?
    Mr. Zoellick. I do not know for sure. My own recommendation 
is that we have to look at this, you know, within a matter of 
months or sooner.
    Mr. Mollohan. Well, now, that was my understanding a couple 
of months ago.
    So, what you are suggesting is that there is not--the U.S. 
Trade Representative does not know of this being considered in 
any particular timeframe?
    Mr. Zoellick. I just do not know when a decision will be 
made, Congressman.
    I know that I and my colleagues have given this a high 
priority. We have had a number of meetings on the subject.
    We have tried to have a lot of work done at a staff level.
    Mr. Mollohan. Has the President said, ``I want a decision 
on this in a certain timeframe''?
    Mr. Zoellick. Not to my knowledge.
    Mr. Mollohan. Has the Secretary said, ``We want a decision 
on this within a certain timeframe''?
    Mr. Zoellick. Secretary of Treasury or----
    Mr. Mollohan. Well, who is the leader of this group that is 
meeting?
    Mr. Zoellick. I think both the Secretary of Commerce and 
the Secretary of the Treasury have been playing a leading role 
in it, in part because----
    Mr. Mollohan. Have they imposed any timeframe in which a 
determination should be made with regarding initiating a 
Presidential 201?
    Mr. Zoellick. My understanding is that there have been, 
sort of, work plans for schedules for work to be done. I do not 
know of an exact deadline.
    Mr. Mollohan. So you are pretty vague about this whole 
issue? At least that is what I am hearing of your testimony.
    Mr. Zoellick. I have to say I have talked to a lot of 
people in the steel industry, and you are the first one that 
feels that way. I mean, a lot of people feel----
    Mr. Mollohan. Well, I am sorry, too, and I have to say that 
I am just basing my judgment on your testimony here, because 
you cannot give me any sort of----
    Mr. Zoellick. I am sorry, sir, I do not know when the 
decision will be made.
    I think that, you know, we have tried to take this issue up 
pretty quickly. It is a decision that I know, from talking with 
both the companies and the unions, at least, in my own case, 
they feel that we and I have tried to devote a substantial 
amount of time to this issue.
    Mr. Mollohan. And we appreciate that.
    Mr. Zoellick. And, frankly, in comparison to 
ourpredecessors, they are delighted.
    Mr. Mollohan. Well, I hope you are not holding your 
predecessors up as a standard, are you?
    Mr. Zoellick. I am only making the point that, in the 
context of trying to do this within the first three months, I 
think I and my colleagues have devoted a reasonable amount of 
time.
    I have also tried to be fair and open with every member of 
Congress and with people on the outside----
    Mr. Mollohan. Mr. Zoellick, I am questioning your fairness. 
I am just----
    Mr. Zoellick. But I was just trying to say I have tried to 
relay the information as I know and the process.
    Mr. Mollohan. But, let me--good intentions are great in 
this area, but we are just really interested in the homework 
and what it looks like after we get--Mr. Chairman, is my time 
up?
    Mr. Wolf. Well, we have never ever limited anyone. We 
actually use personal discretion, but we haven't ever gaveled 
anybody down.
    Mr. Mollohan. I think I will wait. Thank you, Mr. Chairman.
    Mr. Wolf. Ms. Roybal-Allard.

                  trade policies and state sovereignty

    Ms. Roybal-Allard. Thank you, Mr. Chairman. There are 
leaders of the California state legislature--in fact, I believe 
it was one of the Senators from California, Sheila Kuehl, wrote 
to you earlier this year expressing concern about the impact of 
certain trade policies on state sovereignty.
    One of the issues that has been supported in a study in 
Georgetown University Law Center identified at least 80 laws in 
California that potentially conflict with the WTO agreements 
alone.
    Can you tell me what your Administration's position is 
regarding these state health and safety laws that are under 
attack by the WTO and other trade agreements, and what 
precautions, if any, are being taken in ongoing trade 
negotiations?
    Mr. Zoellick. Yes, there is a strong sensitivity to making 
sure that states and, obviously, the national government have 
the ability to set their own environmental and other laws.
    The question under WTO procedures is usually how they do 
so, whether it is done so in a nondiscriminatory fashion.
    So, whenever we deal with either state or other issues, I 
think that is the key question to look at.
    But, I think there is a strong sensitivity to the fact that 
ultimately you are going to have to be able to preserve the 
country's ability to set some standards and laws.
    There are a couple of cases related to the investment 
issues that have come up where we have actually worked with the 
state authority to be able to defend their ability to have 
those laws, and I do not think the cases are likely to be 
successful.

                         health and safety laws

    Ms. Roybal-Allard. Are there any health and safety laws 
that can be overturned by the WTO?
    Mr. Zoellick. Well, first off, Congresswoman, is that none 
of these can be overturned by the WTO--what could happen in a 
case is that, if the WTO finds either, you know, a federal or 
state action that is inconsistent, okay, then it is up to the 
country to decide what to do.
    One possibility is to change the law. Another possibility 
is to offer compensation in some other area so the sovereignty 
of the United States is always retained in these.
    I am glad you asked. It is a key point that people often 
overlook.
    So, you know, at the end of the day, if our compensation is 
not accepted, then the other country--the third option is they 
have a right to withdraw concessions that they have given us.
    So, there is not an ability for the WTO to require us to 
take an action. It is up to us what to do.

                       free trade of the americas

    Ms. Roybal-Allard. I would like to talk a little bit about 
the Free Trade Area of the Americas, because, in the past, I 
have supported your free trade initiatives.
    Actually, I voted for NAFTA, and one of the reasons I voted 
for it was because of a lot of the promises in terms of 
protecting workers, training and environmental protections.
    If you see what has happened, the reality is that those 
promises really were never realized except by a very small 
group of people.

                                textiles

    The majority of American workers, particularly, for 
example, in the area that I represent in Los Angeles, we are 
negatively impacted and never did benefit from any of the 
programs or the promises that were accompanied by NAFTA.
    One example is the case of a company which is a jeans-
maker, Guess, Inc.
    According to a Wall Street Journal report, Guess has cut 
the percentage of its clothes sewn in the Los Angeles area from 
97 percent prior to NAFTA to 35 percent as of February, 1997.
    It has sent work to five sewing factories in Mexico and to 
plants in Peru and to Chile.
    More than a thousand of the Los Angeles Guess workers 
actually lost their jobs and never applied or got any benefits 
from the NAFTA TAA program.
    My question is that, as you are putting together these new 
trade agreements, what leads you to believe that the right 
balance can be struck between the FTAA, especially after this 
experience in NAFTA?
    How are we going to improve on it when we cannot even make 
good on what we have already promised and many, many people 
have been very, very negatively impacted?
    Mr. Zoellick. Let me try to take a couple of pieces of 
that, because I think that is going to be a core question for a 
lot of things we do.
    I just ran through this very quickly at the start, but, you 
know, one thing that has not been talked about much is that, if 
you take the NAFTA and the Uruguay Round together, the two 
trade agreements that came at the time, in terms of the savings 
for an average family of four, because of the lower taxes, 
because cutting tariffs also lowers the price of goods, plus 
the higher income, is that you have got savings for a family of 
four of about $1,300 to $2,000 for an average family of four 
across the United States.
    One of the reasons people often do not notice this is 
because--and this goes to one of the heart of your question--is 
that the benefits are more generally felt.
    It is often low- and moderate-income people that have to 
pay the most for this, whether it be sugar or food or clothes 
or other things.
    This is a way of reducing the costs for a lot of their 
product, but it is not so immediately apparent to them.
    What is apparent is when somebody loses a job. Now, the 
other question is why exactly did they lose the job?
    There is a big debate about how much of it is trade and how 
much of it is technology and whether it would have happened 
anyway.
    For example, in the apparel industry, one of the things 
that the U.S. industry has tried to do is actually create more 
of an alliance with Mexico and with some of the Caribbean 
countries and some of the Central American countries, because, 
given the fact that the multi-fiber agreement which had quotas 
on textiles comes off in 2005, our industry, particularly in 
the area of producing the textiles, is going to be very 
important that they link up with some low-cost apparel people, 
because that combination is what is going to have them be able 
to compete effectively with people in India or in Asia or in 
other parts.
    So, another part of this is the integration. The part that 
you mentioned about the adjustment, however, is one that I 
think is going to be key, because there is absolutely no doubt 
that, you know, when you do have trade, that there's some 
people that, through the whole adjustment process, are going to 
lose out.
    The question is how do you help get those people back on 
their feet and into jobs most effectively.
    This is an issue that I have tried to get some broader 
discussion on. It is primarily more for the Department of 
Labor.
    Actually, we have talked to some of the DOC and others 
about some ideas they have on this, because, you know, I think 
what people are starting to learn over time is that it is best 
to have programs that help people however they lose their jobs.
    In other words, one of the problems with some of the trade 
adjustment programs in the past is they almost go through 
analysis to say, well, did this guy lose the job because of 
trade or did this one because of a competitor somewhere in the 
United States or because of some productivity improvement?
    It becomes a bureaucratic morass, and my own view is that 
the real answer is, however somebody loses their job, we need 
to have a retraining program in as early as you can.
    This seems to be one of the key--is to get it in early and 
in operation so as to be able to help people learn where there 
are other possibilities and where you have additional education 
and training.
    There are some other ideas that people are floating around 
in terms of concepts of wage insurance that I think should be 
looked at as well.
    One of these we are actually considering in a pilot area in 
the steel area is one that I have tried to urge us to look at.
    There are questions about how that works and whether it 
becomes a big entitlement.
    So, I apologize for going on a little longer, but I think 
it is an exceptionally good question.
    Part of the problem is, you know, we have to do a better 
job of explaining how some of this does provide real benefits, 
frankly, particularly for low- and moderate-income people that 
suffer from--paying a higher amount of their disposable income 
for some of the things that we are hoping to provide at a lower 
cost.
    But, there is no doubt that, if some people are going to be 
losing jobs for whatever reason, it is important that we try to 
help those people get readjusted as quickly as possible.

               north america free trade agreement--nafta

    Ms. Roybal-Allard. Well, the point is that one of the 
promises of trade agreements----
    I will use NAFTA as an example. One of the promises for 
getting support for NAFTA was don't worry, people that are 
going to be impacted are going to get help and get assistance 
and they are not going to be disadvantaged by losing their job.
    So, when you connect that to these trade agreements, then 
there is a connection, although I agree with you that it should 
not matter what the reason is somebody loses their job. There 
should be something to help them.
    But, in the promotion of trade agreements, it is always 
connected.
    Yet, that promise of jobs or retraining or whatever it is 
is seldom realized by the majority of people who lose their 
jobs.
    It is little comfort to tell a family, a father, and a 
mother who are out on the street now, who are homeless, ``Yeah, 
but, you know, your neighbor is going to pay less for goods 
now.''
    There is no comfort in that, and I think that, as we are 
looking at these trade agreements, we have to take that into 
consideration, not just in rhetoric, but making sure that, in 
reality, the promises that we make to people in terms of 
helping them as a result of trade agreements, that we actually 
meet those promises.
    Which brings me to another concern that I have, because one 
of the purposes of the FTAA is to stimulate American economic 
growth by opening new markets for American companies and 
workers.
    Now, I am trying to understand how that is likely to happen 
when statistics, for example, show that Latin America's share 
of hemispheric economic output has actually declined in the 
past years.
    Giving the example that most of South America right now is 
mired in foreign debt, Argentina and Brazil have accepted IMF 
rescue packages, requiring them to cut back on consumption at 
home, aren't a lot of these benefits really treaties that are 
more likely to benefit those countries at the expense of 
American workers?
    Mr. Zoellick. I honestly do not think so, Congresswoman.
    Let me give you a couple of examples and come back to the 
Mexican case again.
    You know, our exports to Mexico have grown twice as fast as 
they did to the rest of the world after NAFTA.
    Even with the peso prices, you saw per capita incomes since 
'93 to '99 grow about 8.3 or nine percent.
    So, that kept growing, and there is another important part 
just to link to your financial part.
    You know, trade can help address some problems. It cannot 
solve all, obviously.
    But, when Mexico had a peso crisis in the early '80's, it 
took seven years for them to be able to get back in the 
financial markets, which is partly a model of their growth.
    After NAFTA, it took seven months. It took us seven years 
to be able to get our exports back up to the level that they 
were at in '83 after the peso crisis.
    It took us 17 months after NAFTA, so, setting aside the 
whole benefit, which I know you are particularly aware offrom 
your part of the country, too, is that--the transformation.
    This has been part of a more open Mexico, a democratic 
Mexico, and all the implications that will have for a whole 
series of issues related to Mexico.
    I do believe that the potential is there for the rest of 
Latin America.
    Even without some of the changes I have talked about, our 
exports have grown to Latin America more than they have grown 
to the rest of the world.
    At least, in part, this is because, you know, Latin America 
is at a stage of development where forecasts--and they are 
worth what you pay for them, I guess--but the forecasts are 
that, you know, Latin America will be growing more over the 
next ten or 15, 20 years than you would expect in Europe or 
Japan.
    That is not out of line, given where they are in the stage 
of development.
    So, I believe Latin America is a growth market. I certainly 
do not mean to suggest that this is the only part of an 
economic development issue, and I mean, whether the role of the 
IMF or the World Bank and----
    Indeed, as the Chairman and I were talking about a little 
bit before, I think one of the key aspects of this is it has 
supported democracy in the region, because, given a whole host 
of other issues that you probably have interest in in terms of 
labor standards or environment, I think the best way to assure 
those is to create more open societies and create groups in 
those societies that help promote them.
    I do see it as a framework in which a lot of other things 
operate.
    But, just as I mentioned to the Chairman in the case of 
China, I do not mean to say it is the exclusive approach.
    Ms. Roybal-Allard. Okay, but the point is--and I do not 
disagree with what you are saying in terms of the merits of 
trade--you know, free trade, but I think that it is important, 
as we are promoting free trade, that we also make sure that the 
negative impact on American workers is dealt with as well.
    Also, that you know for example, one of the things that we 
have said in terms of NAFTA and creating jobs in NAFTA is that 
it would eventually result in less illegal immigration, and so 
on and so forth.
    I think it is important to note that, unless wages and 
working conditions are better in Mexico, and that we as a 
country do not pressure that, that a person who is working--
gets a job in Mexico at the expense of an American worker, that 
American worker was probably sending back to Mexico about four 
or five times more than what that person is earning in Mexico.
    So, there are a lot of discrepancies there, and I think 
that in order to gain support for these trade agreements, that 
we should not just focus on some of the positive aspects.
    We have to keep in mind the people that are negatively 
impacted, that suffer, that lose their job, lose their homes, 
and are out on the street as a result of trade agreements as 
well.
    Mr. Zoellick. Congresswoman, I just want to say--I mean I 
agree with you 100 percent.
    I think anybody who supports trade has to recognize there 
is an adjustment process.
    You and I can look at studies that show in the long run how 
it benefits the whole society.
    But, I do believe that has to be part of a societal's 
response, and I--you know, to be honest, I think this is one of 
the reasons why even the education work that the Congress is 
working on is a key aspect of this, because it is going to be 
hard to have people be able to adjust to different working 
circumstances unless they have got the right education.
    This is particularly in some of the areas that you are 
talking about where kids do not get a fair start.
    So, I think in general--and I am only doing this to 
reinforce this--is that, you know, part of what we have to do 
is to help people adapt to change.
    It is the right thing to do, and it is also the politically 
wise thing to do.
    Otherwise, you are not going to maintain support, and that 
includes, frankly, education systems. It includes affordable 
pensions.
    It includes how they deal with health care. A whole host of 
things in terms of helping people adjust, and that is why I 
mentioned, particularly, on the worker adjustment program.
    You know, some of these programs at work, some happen over 
time, but I think it is important that we look at them fresh.
    Ms. Roybal-Allard. If I may just make one more point, Mr. 
Chairman, and this is a bone of contention that I actually have 
with the business community.
    Whenever they come in to promote trade, maybe we will 
talk--for example, I will use NAFTA again--they talked about, 
NAFTA and all the benefits.
    But, once they get what they want, once the trade 
agreements are approved, then they forget about the other 
side--and all the promises.
    I think that it is not enough just to put them into law or 
to advocate for it, but I think there has to be a strong, if 
not stronger, commitment after the trade agreement is approved 
to make sure that those promises are kept.
    Talk is cheap, and I think NAFTA is a perfect example of 
that.
    The business community and everybody else forgot about that 
aspect of the treaty.
    Mr. Zoellick. You know, Congresswoman, as even a small 
point on this, I realize you are talking about it in a broader 
sense.
    I think part of the business community also has to be 
responsible probably to help you and me make the case for it 
where it does work.
    I mean, for example, I was talking with farmland industries 
that, on their biweekly paychecks, they point out to their 
workers, you know, what percentage of their product is going 
overseas just to help people understand this.
    I mean, the one that I always found somewhat bizarre was 
the machinists from Boeing who were against trade, and they 
would not be in the business unless there was trade going on in 
the world.
    I realize you are talking about a different set of issues.
    But, I think that the point about the business community 
needing to do this as an ongoing basis is one that I certainly 
make the point and would be pleased to work with you on that.
    Ms. Roybal-Allard. Thank you.
    Mr. Wolf. Mr. Kennedy.

       Department of Labor Trade Adjustment Assistance to Workers

    Mr. Kennedy. Thank you. Mr. Chairman, I just want to 
associate myself with the remarks of my colleagues who have 
just been talking about this issue of fairness in trade.
    I know you make some points about balance. To cut to the 
chase, you have said that you agree with the notion that there 
needs to be protections built in place.
    For example, when you were Commissioner of the U.S. Trade 
Deficit Review Commission, you indicated that broader worker 
adjustment programs need to be in place.
    You just spoke in reference to Congressman Mollohan about 
the issue of steel.
    I do agree with him that this is something that definitely 
needs the Administration's attention right away, and we cannot 
put it off any longer.
    For example, you mentioned the area of wage insurance, so I 
am encouraged to hear that this is something that you and the 
Administration would be willing to talk about further in terms 
of policies that you would be supportive of.
    Mr. Zoellick. Well, I am certainly willing to talk about 
it.
    I have suggested it is primarily Department of Labor, but, 
in the context of trade, you know, I have had some discussions 
with colleagues about some of the ideas that Bob Leighton and 
others have talked about.
    You know, there are questions about how to do this in a way 
that does not become a huge new entitlement program.
    But, my own perspective on this, Congressman, is that, when 
you have an idea like this, it is worth trying. It might be 
worth trying in a pilot and see how it works.
    Mr. Kennedy. Well, the point I want to make is I agree with 
you that this has to do with the Department of Labor.
    Where I think that there needs to be a more comprehensive 
approach from the Administration on this is that they cannot 
have Department of Labor come over here and sing one story and 
you sing another. For example you seem to be saying, ``Yes, 
wage insurance sounds good because we think the steel industry 
has been adversely affected and we want to protect them, but 
that is a Department of Labor issue.''
    Many of the things that I am talking about, for example, 
you are supportive of.
    In fact, you said recently in an interview in Roll Call one 
of the major problems with trade is that the benefits are 
widely distributed and the cost adjustment are localized.
    You just made that same point with Congresswoman Roybal-
Allard.
    You say localized pay has to be dealt with through some 
readjustment. That is what you are stating as a policy.
    You cannot divorce yourself nor can the Administration 
divorce itself when you say, ``Oh, well, that is Department of 
Labor. I support you, Mr. Kennedy. I support you, Mr. 
Mollohan,'' about trying to do these things, and then say, 
``But that is Department of Labor's issue.''
    I mean, it is understandable that we are going to have, due 
to globalization, a whole host of needs out there to the 
continued readjustment, which you support.
    But, the TAA, as you know, only increased $23,000, but, in 
Department of Employment and Training in the Department of 
Labor, similar programs are cut by over $541 million.
    So, while the Administration on one side can say, ``Oh, 
well, we care about that, we are upping TAA,'' what they do not 
tell you is that they are eviscerating the main bulk of trade 
adjustment assistance over in the Department of Labor.
    They cut over $200 million from the Dislocated Worker 
Employment and Training account.
    So, I reject the Administration's policy that they are 
somehow sensitive to the issues of readjustment.
    This is not an attack on you, Mr. Ambassador. I understand 
how you have to carry a lot more water than your own here in 
terms of what in the Administration you represent.
    But, this is the problem, and we cannot reconcile it. No 
one can take what I have just said and reconcile those two 
facts.
    With regard to this, what do you anticipate within the EDA, 
for example, for TAA, given the added pressure that cutting all 
this employment and training from Department of Labor is going 
to create in conjunction with all the additional global trade 
agreements that this Administration wants to undertake?
    Do you think a $23,000 increase is what it is going to 
take, or do you think that it may take more than that?
    Mr. Zoellick. Let me try to address the points, 
Congressman.
    First, I am not trying to divorce myself from it. I think I 
have a policy interest in it and want to try to work on it.
    I just try to be careful with people, because I just do not 
want to mislead anybody, it would be like an issue for somebody 
who is coming in and who is on the Education Committee talking 
about appropriations, okay?
    So, I am just trying to say, you know, I am working on it, 
but I am not the appropriator, okay?
    Mr. Kennedy. Right.
    Mr. Zoellick. But that is not to divorce myself, because it 
has got to be part of our--I agree, in the Administration 
effort, but more particularly----
    Mr. Kennedy. Especially if the Administration wants to get 
the support----
    Mr. Zoellick. I agree.
    Mr. Kennedy [continuing]. Of people like Lucille Roybal-
Allard who supported NAFTA but has already said that her 
experience from it as has many others, has also been the same.
    But, they are not willing to buy this hook, line, and 
sinker any longer from industry that somehow everything is 
going to be pretty with regard to trade adjustment.
    Mr. Zoellick. Let me just follow up on that.
    Mr. Kennedy. All right.
    Mr. Zoellick. What part of this involved was the trade 
adjustment assistance, as you may know, actually grew out of 
the Ways and Means and Finance Committees in the '70's, okay?
    I was just alluding to that. It almost became kind of an 
entitlement program.
    It was very complex. It actually was about three times as 
expensive as a program that, I believe, your uncle also sort of 
worked on that actually was more Department of Labor-based, and 
it was at that time a Job Training Partnership Act.
    Then, I think in subsequent years, it now has the word Job 
Investment or something in it.
    Part of what I was just alluding to in the shortness of 
time is, when I last looked at these programs.
    It was interesting. The one that your uncle had worked on 
with, actually, Senator Quayle, I think at the time was one 
that produced----
    It was about one-third the cost. It was like $2,500 a 
worker versus $7,500 a worker.
    The placement rate was much higher, and it went to some of 
these questions of when you get in, and, actually, by making 
the other one entitlement, you have to check on----
    You know, they could not start them until somebody lost the 
job as opposed to when they start.
    So, there were a number of nitty-gritty operational 
aspects. I have had some discussions with my labor colleagues 
about how this is an important area to promote.
    But, one other point on the budget numbers, and, again, 
this is just by general knowledge, was that during the 
transition process I talked to some of the people who were 
putting together the budget for all the labor training, so I do 
not know that is why.
    At least, my sense was that that was not going to be cut, 
because, in fact, I was trying to say, look, you can't be 
cutting that if we are going to try to do this, okay?
    Mr. Kennedy. Right.
    Mr. Zoellick. In fact, where I have tried to channel my 
energy now is to say, working with the appropriate committee of 
jurisdiction, is what can we do to make this even more 
effective, trying to answer the exact points you have 
mentioned, and the wage insurance being one thing that I have 
urged to look at.
    I am careful in saying that, because I realize I am 
speaking for an Administration, the Cabinet Department. Those 
are my views. It is what I am trying to promote.
    I think there is some sympathy, but I am trying to let you 
know----
    Mr. Kennedy. Right. Well, there is some great sympathy 
here, at least for me.
    I would be really anxious to support what you are trying to 
do.
    I think that you will find that from both sides of the 
aisle, participants in this debate are not hearing, as much as 
they should, the points that you are making.
    You say that it costs more to conduct trade adjustment 
assistance through the ways and means process than through the 
appropriations process because of how it is subject to 
unchecked increases as an entitlement rather than targeting it 
through annual appropriations like Department of Labor. 
Obviously that is not the approach that is currently being 
taken by the Administration.
    For example, I just referenced the $500 million cut from 
Dislocated Worker and Employment and Training Department.
    But, I think I made my point, and I understand where you 
are coming from.
    But, let me go to another subject, which goes to what 
Chairman Wolf was talking about earlier in terms of making sure 
that, with free trade, there comes enforcement of standards. We 
have this hope that with free trade, the human condition, gets 
better, right?
    Well, we know through experience that just by increasing 
trade things do not get better.
    For example in the case of China, we have seen where they 
have exploited the existing bilateral trade agreements.
    This is something that both labor and industry and human-
rights groups and everybody can get behind.
    In short, how do you enforce these trade agreements? What 
are you going to do as Trade Representative to enforce the 
agreements we already have, let alone embark on new ones.
    Mr. Zoellick. Well, it obviously depends on individual 
cases.
    With some, as you know, we have powers under our trade laws 
that take various sanctions against them.
    If they are not yet a member of the WTO, if they become a 
member of the WTO, then there's another set of procedures you 
can follow in that.
    The starting point on a lot of these, as you would know, 
Congressman, is to kind of make sure that the guys in charge 
actually know what is going on.
    So, for example, with the agricultural agreement that had 
been made with China, I brought this to their attention early 
on in some of the product categories that our people thought 
were being inhibited in terms of the imports.
    We did see some improvement, because part of this is, you 
know, in a country of 1.3 billion people, sometimes the guy at 
the port does not get the word.
    Mr. Kennedy. But let me give you, an example quickly. China 
announced a new series of import registration requirements 
according to the Republican Commission of the U.S. Trade 
Deficit Commission.
    The U.S. experience with China's import licenses 
demonstrated persistent trade problems, and China agreed 
toeliminate import licenses, and then they announced a new series of 
import registration requirements. Functionally, these import 
registration requirements are identical to import licenses and they 
were not distinguishable from them.
    That was not like they got messed up and they did not know 
what was going on.
    They deliberately were trying to circumvent the laws. I 
just wanted to leave it at that.
    Mr. Zoellick. I agree with you, though. I mean, if you are 
going to be sustainable on this--that is what we were talking 
about earlier--you have got to be able to monitor them----
    Mr. Kennedy. Monitor them.
    Mr. Zoellick. You have got to be able to enforce it.
    Mr. Kennedy. And enforce them. In terms of monitoring and 
enforcing child labor laws, and again, I understand this has to 
do more with the Department of Labor than you.
    But, like you said, all of this is interconnected. The 
Department of Labor budget cuts funding for international labor 
programs by more than half.
    This is not small. This is $15 million from the 
international program for the elimination of child labor.
    Fifteen million dollars cut to eliminate child labor, and 
this is a one-third reduction for the overall budget. It cuts 
$11 million from technical assistance provided for enforcement 
requirements, labor standards.
    There is going to be serious questions if the President and 
the Administration want to move forward on these trade 
agreements.
    What are they thinking? How in the world can they think 
they are going to convince this Congress--any Congress--without 
having to do a lot of spinning to make sure that this thing can 
even be passed amongst their own members when they have budget 
cuts.
    Have they come up with a better way of eliminating child 
labor? If they have, I am anxious to hear it.

                      INTERNATIONAL LABOR PROGRAMS

    Mr. Zoellick. Let me address this one, Congressman, because 
actually this first came up in a conversation I had with John 
Sweeney.
    I talked with both Department of Labor and OMB about it, 
and also actually Secretary Chao and some of the White House 
staff.
    Here is at least what I have learned and my sense of it. It 
is that the international labor programs that you are talking 
about were in total about $10 million a few years ago.
    In Fiscal Year 2000, they went up to $70 million. In Fiscal 
Year 2001, they went up to $140 million. You are seeing a 
pretty big growth here.
    In Fiscal Year 2002, the proposal was $70 million, so it 
went back down to the fiscal year 2000 number.
    That creates some of the cuts in the subcategories that you 
are focusing on.
    When I checked into this, it dealt with, you know, child 
labor, core labor standards, some education, technical 
assistance, some studies, HIV AIDS.
    Many of them sound good. I do not know about every set of 
study aspects. At least it would be understandable to me that 
100 percent increase over the course of one year would, at 
least--people to raise questions.
    But, you know, I share your general view about if we are 
going to try to rely on the International Labor Organization, 
then if we feel the money is productively spent, then we should 
try to be supportive of it.
    I will just relay that I have had some conversations with 
both the Chamber of Commerce and the International Council for 
International Business, which you may know is the U.S. business 
representative of the ILO, about trying to look at this and be 
supportive of it all again.
    So, again, I talked about this with Secretary Chao and 
others in the process.
    I cannot speak to the exact deficiency of every one of 
these set of dollar amounts on this.
    But, you know, I personally believe--and I said elsewhere--
that we need to do a much better job of trying to draw on the 
ILO, okay?
    If we are going to make it a serious organization, then we 
have got to commit to make it. That is not always money. It is 
other things as well, okay.
    Mr. Kennedy. Right, right, I hear you.
    Mr. Zoellick. But there are other ways just on the child 
labor, and I just want you to know where I do believe, on the 
trade side, we can help, is that the last Congress being pushed 
by Senator Harkin, actually, put in an additional standard in 
some of the preference agreements that we have with the 
Caribbean countries and with the Africa Bill.
    I, frankly, you know, have proposed--and this will be part 
of our overall Administration proposal--that we add that to 
other preference Bills, like the trade ones that we have to 
renew----
    Mr. Kennedy. Right.
    Mr. Zoellick [continuing]. Because I think that--and in 
general--there is an article about El Salvador in The New York 
Times--is that we can use, in particular, those preference 
programs to focus on those core labor standards.
    Again, just so you have a sense of this, it was about a 
week or so ago I was calling the Guatemalan Vice President, 
because Guatemala has had a pretty bad record in terms of 
violence and labor issues, to try to push them on some 
legislation and other items.
    So, to go back to your point about child labor, I mean, you 
know, if this is one we cannot agree on, we are never going to 
be able to make it, right?
    So, I mean, my point on this is to start with some of 
these--some of the forced-labor questions that the Chairman was 
talking about.
    Frankly, the other core standards deal with right of 
assembly, right to organize, nondiscrimination, I mean, and 
those are points where there's going to be big arguments about 
what one does in terms of sort of working and hour conditions, 
and so on and so forth.
    But, on these issues, I do believe we have to be sort of a 
vigorous advocate of them in the ILO and where we can do them 
with these preference----
    Mr. Kennedy. Because as the Chairman said, ``what goes 
around comes around.'' It is, like you said, the right to 
organize.
    This is the bottom line. Mexico has great labor law, but 
they never enforce it, so it does not mean a thing.
    Mr. Zoellick. It is getting a little better now, andthat 
goes back to this.
    Part of it is, as a more open society, you are now getting 
some more independent labor unions. They all used to be sort of 
basically handmaidens.
    Actually, it does go back to the Chairman's opening point, 
and to me, you know, I really feel, to be successful with 
trade, we have got to connect it to our overall value system.
    Mr. Kennedy. Right.
    Mr. Zoellick. We are going to have debates about the pace 
and how much the trade system can carry.
    I frankly would not be surprised and sometimes worried that 
we put everything on the trade system and it collapses under 
the weight of it, and then we kill two good things.
    So, that means there's things we do with the ILO in part, 
and sometimes we can link them to the trade system and the 
trade preference.
    So, I am open to try to do that, and I think we are going 
to have to do that.
    Mr. Kennedy. Well, when I was down in South America a 
couple of years ago with Menham, and Cardozo, all of them spoke 
about the need to have the United States take a leadership role 
on this, because they said ``we cannot do it on our own in our 
own countries. You think that the Chamber of Commerce rolls you 
over in the United States, imagine what it is for a small Latin 
American country like us. We have no power against the Chamber 
here, so we need the United States to act as the bulwark of 
labor rights, and environmental rights in many respects.''
    I thought that was interesting, because they basically said 
we care about our people as much as you care about your 
workers. We do not want to see our workers work in sweat shops 
anymore than you want to see yours.
    Mr. Zoellick. Congressman, I think it is a critical point.
    Again, I jumped over this in my testimony. When I went down 
to Chile, in addition to meeting with the business groups, I 
met with the labor groups, environmental groups.
    I invited the labor leaders, when they came back up here 
for the International Labor Conference, to talk to them.
    So, I do think there is a role we can have in encouraging 
it.
    What I am also a little careful about--because let me tell 
you what I hear from the developing world--is there's a lot of 
fear down here.
    I realize it gets confused up here, that sometimes people 
are going to use some standards, not these core labor 
standards, but some standards to basically create a different 
form of protection.
    I can tell you when I was down in Buenos Aires with these 
33 other Trade Ministers, you know, bringing up this topic just 
makes them apoplectic at first because they are worried about 
its effect in terms of their ability to sell to a market.
    On the other hand, as you said, when you start to talk 
about it within their own systems, the plan is, well, I believe 
you want to plant their own roots.
    Some of these guys are from labor parties. I mean, 
President Lagos is a socialist from a labor party background in 
Chile.
    So, if you can make it less threatening and more of a 
cooperative venture, plant the roots, do it in a democratic 
system so they get their own political basis of support for it, 
you know, then I think you have a chance to be much more 
sustainable.
    That is, quite frankly--you know, Congressman, the reason I 
am taking time on this, in particular--and I appreciate you 
raised it--is that I think this is going to be----
    One of the big issues we are going to have to try to 
address over this year and other years is how do we come to 
deal with some of these. We don't want to kill the golden 
goose, but we need to address some of these topics.
    Mr. Kennedy. Well, the golden goose--the disparity in the 
gold is getting greater and greater in the world.
    You have made mention of it in many capacities that you 
have been involved with--the disparity of wealth and how it is 
distributed in this new global economy.
    I have a tough time thinking that it is poor people earning 
less than a dollar a day that are going to have the power 
against the corporate multinationals.
    Somehow I have trouble believing, even if we impose great 
labor standards, that somehow, the workers are going to unite 
and big corporate international corporations are going to get 
rolled over.
    Somehow I do not think that is going to be the case. I do 
not think that has ever been the case nor will it ever be the 
case.
    Mr. Zoellick. The challenge is, coming back--I mean, I 
certainly understand that point--is that the question is how do 
we best help them on this.
    There is some interesting work. The World Bank went back 
and looked over the course of 20 or 30 years of about 80 
countries to look at developing countries and how they 
approached this.
    The ones that were more open, I mean, they grew at about 
five percent.
    But, the ones that were not open actually lost their growth 
through the period.
    Moreover, in poverty rates and in terms of other--and in 
terms of wealth issues, it has improved, so----
    Mr. Kennedy. I agree with you. Trade is the way to go. I am 
not an opponent of trade.
    I think trade can be definitely a good thing, and do not 
misunderstand me. We should go forward with trade and be 
reasonable about it.
    The final comment I would make, Mr. Chairman, is that, 
while you said that the budget crept up dramatically the last 
couple of years, so $72 million is kind of a retrenchment, the 
Department of Labor budget, eliminates entirely bilateral 
assistance for those countries, like Guatemala, with high 
levels of child labor.
    This was a program that received $37 million and none in 
the next budget--zero.
    So, I can understand cuts.
    But, I cannot agree when you eliminate all together a 
program that is targeted to the most abusive child labor 
violators in the world.
    You don't have to answer this question. You did a terrific 
job trying to cover for your office and the Administration on 
this.
    Mr. Zoellick. Just, again, just for the record, 
Congressman, I think we are probably in agreement on much of 
this.
    But, just to be fair to my colleagues on this, the 
information that I had was that the ILO IPEC Child Labor 
Program is still at $30 million.
    There is still money in the core labor standards and the 
bilateral technical assistance.
    The only one that is cut on this was a separate child labor 
initiative called School Works, which is an educational 
infrastructure.
    Again, you know, I am happy to look at these, but I do not 
think all the child labor funding was cut. I think that one 
was.
    Mr. Kennedy. Okay.
    Mr. Zoellick. You still may be right on it.
    Mr. Kennedy. Right. You do a good job, and you earned your 
pay today. I expect you earned your stripes today, I will tell 
you, putting up with Congressman Mollohan, I tell you. 
[Laughter.]
    Mr. Zoellick. We are going to work together.
    Mr. Wolf. Let me get into some questions dealing with some 
of the budget issues.
    But, before I do, to follow up on it, you know, I think you 
have done a good job.
    Mr. Zoellick. Thank you.
    Mr. Wolf. My comfort has been raised somewhat just by 
listening to you today, although I realize that sometimes the 
appearance before a Congressional Committee can be as much of a 
performance.
    But, I think the comment about values, I think, has been 
exactly right.
    It is a conflict that I have in my conscience on these 
issues so much. Here I am a conservative Republican and want 
deeply to be with the Administration on most of these issues.
    Yet, my conscience tells me, on some of these issues. . .
    I watched in the last Administration Harry Wu could never 
get into the White House, but the Chinese Communist leaders got 
in to hear the Saturday morning Presidential address.
    The power rules, and the powerful rule, and I think there 
is a lot of truth in what my friend was saying--from Rhode 
Island. In most of the cocoa plantations--and every time we 
bite into a chocolate bar, that we should know. In most of the 
cocoa plantations in the Ivory Coast, there is slave labor.
    The definition of slave labor is they are enslaved. Very 
few people, when they go to the Ivory Coast, deal in that.
    Very few people that are in the cocoa business kind of deal 
in that.
    There are roughly several hundreds of thousands--the figure 
high of 300,000--but let's say there are only 10,000 young 
Indian children age seven, eight, nine, and ten beginning at 
5:00 o'clock in the morning working until midnight making 
oriental rugs.
    Those rugs drape the carpets and floors of the powerful all 
over the world.
    In the Bible, Jesus talks more about the poor than he talks 
about any other issue, more than he does trade, more than he 
does about giving, more than he does about salvation--the poor.
    So, I think, Mr. Kennedy, maybe we come at it from a 
different perspective, maybe, but I think there's a lot of 
truth.
    I see that the powerful--I am going to ask you a question 
later on about conflict diamonds, because we want the Trade 
Reps all to participate with the State Department and others.
    The diamond interests have purchased top representation in 
some of the best law firms in New York City and in Washington.
    The young kids have had their arms cut off in Sierra Leone. 
They do not have a Washington lawyer. They have not hired a 
former Congressman who served in the Congress or a former 
powerful Trade Rep, or somebody that has been in your office.
    If you look at many of the people who have left--and you 
have outstanding people--most of the people that leave 
government do not work for the poor. They go downtown, and they 
work for the rich.
    So, Mr. Kennedy has some pretty good points, and I have 
been impressed, quite frankly, with your comments today.
    I want to commend you. I want it on the record so it is 
clear.
    You have said basically the right thing, and I never met 
you before. At least, I don't think that I have, but the sense 
of decency and caring, obviously--so, I think it has been very 
positive, but I think it has been good you can hear these, 
because you may get a different message with my good friends.
    They are all at the Ways and Means Committee who sometimes 
are looking for different perspectives and approach there.
    But, you are going to have your problem with that party, 
but, on my party and our party, there is a whole group of us 
who are really, from the Duncan Hunters to the Frank Wolfs to 
the--I mean, we are really having a hard time.
    So, you said a lot of good things. Let me ask a couple of 
budget issues.
    The FY '01 budget allowing you to build a computer 
equipment base to enable upgrades and implement a replacement 
plan for computer equipment, it was 60,000 provided for 
computer firewall to decrease the likelihood of hackers--we are 
always hearing about hacking into the Department of Defense 
gaining access to sensitive documentation electronically--to 
the State Department.
    Have these resources been used, and are your employees now 
able to send cables to the Department of State electronically?
    Are all of your employees being given new computers and 
laptops, and can you talk to us a little bit about that?
    Mr. Zoellick. Sure, Mr. Chairman. The computer adjustment 
is a three-year phase-in.
    It was based on the assumption--I am probably being 
generous--is that you have three years in terms of updating 
this equipment.
    That is on track, and a lot of that, as you say, is related 
to the equipment for the PCs and the overall network.
    So, that is desktop, file servers, others, and I think that 
is about $245,000 of the money.
    Automating the system for sending cables to the State 
Department, that is supposed to be online by September, 2001.
    At least, I have been told that that is going to get done, 
and then the third one is about the upgrading thecomputer 
network firewalls for security.
    That our deadline date is June of 2001, so those three are 
all on track.

                         USTR PHYSICAL SECURITY

    Mr. Wolf. They are on track. What about the physical 
security of your building office in Washington and in Geneva.
    I have a whole series I will ask for the record, but can 
you bring us up to date what you have been doing with regard to 
both locations?
    Mr. Zoellick. Well, on the Geneva one, I am going to be 
going to Europe next week, so I wanted to see it myself.
    But, I think the first step, as I understand it, is with 
the State Department's help in what is called the Botanic 
Building is that we now have a guard on the inside and on the 
outside.
    There has been some upgrade in terms of lighting and the 
locks and in terms of the video camera.
    I think your staff has helped us a lot on this to get it 
done, but, separately, there are still concerns about the 
security of the building location.
    We have talked to the FBO and the State Department about 
the possibility of moving, and we asked whether it might be 
related to the more general mission in Geneva which is not too 
far away.
    At least, the response we got was they probably cannot move 
it to that location, but they would help us look for other 
possible locations.
    So, my understanding--but I will see this next week--is 
that, on that location, we have been able to try to do what we 
could to upgrade the security and the guard system with 
contract guards.
    But, we are looking at a possible safer location. On the 
U.S. front, you know, we have a combination of things.
    There were some things done with some of the parking places 
right next to us, although now it is a construction site.
    We have a guard system that is frankly--it is primarily a 
question with demonstrations that they work pretty closely with 
the Metropolitan Police.
    At least, in my limited experience, it worked pretty well.
    It also helped fall in on our other point that, one of the 
groups that demonstrated, I asked them to sort of come in as 
the active group on HIV AIDS.
    So, I talked to them. They still demonstrated anyway, but 
maybe it is a little better.
    So, on those, I think we have followed through on 
everything that we worked with with you and your staff, and, 
really, at least as I have been informed, your people have been 
extremely helpful to us. My thanks goes to you.
    Mr. Wolf. Okay, so everything is being done? Okay. There 
has been a tremendous amount of layoffs in the high-tech 
industry.
    Every day, we pick up the paper about another one, and our 
strength, obviously, is in the high-tech capability.
    We should be exploiting our strength in the high-tech area, 
particularly. What are you doing----
    What are we doing to open up the markets with regard to the 
high-tech community?
    Mr. Zoellick. Well, in reference, I think, to Mr. Serrano's 
question----

                         INTELLECTUAL PROPERTY

    Mr. Wolf. I think his were a little bit--I mean open up the 
markets. I think he was talking more about the Digital Divide.
    Mr. Zoellick. Well, I think, you know, part of this relates 
to a topic we did not discuss, which is intellectual property.
    Here, again, it is a question of not only--number one, it 
is enforcement of some existing agreements.
    So, for example, we are starting to take some action 
against Ukraine, which is a major pirate of some of the optical 
disks.
    But, then, it is also a case of updating it for some of the 
different types of intellectual property related to some of the 
digital systems.
    So, in a lot of our new agreements, for example, the one 
where we--that the prior Administration did with Jordan, the 
one we are trying to do with Singapore and trying to do with 
Chile, we are trying to upgrade the overall standards of this 
so as to be able to help our competitive position with the 
intellectual property related to the high-tech area.
    That is the major topic, other than some of the ones I 
mentioned before that are connected items, like basic telecom, 
enhanced telecom.
    There, again, this predates me. People have been pretty 
successful in terms of starting to open up some of those 
markets.
    It has, in part, been related to privatization in a lot of 
these countries that create additional competition.
    But, it is an area where we have to keep pressing. I mean, 
for example, the Mexicans have moved in terms of liberalizing 
their telecom market, which would be very important, some of 
the high-tech connection.
    But, they still have not moved to make the competitive 
international rates, and that is one of the items that I was 
discussing with my counterpart just this week.
    So, it really covers the gamut from intellectual property 
to the telecommunications.
    Mr. Wolf. You really see, though, a major opportunity? I 
mean, you don't feel that we have scratched the surface of the 
opportunity? What do you think?
    Mr. Zoellick. Well, I think it is an area where, number 
one, the United States has a real competitive advantage, so 
that is a real opportunity.
    I think it is a real growth area around the world, 
obviously, with its ups and downs, as we have seen, but it is 
also one where I think there is such a strong argument how it 
benefits these societies.
    Again, let me give you the example in Japan. My 
predecessors and now I are pushing very hard in terms of the 
telecommunications deregulation in Japan.
    Here is a case where the cost of access for a phone--I 
think it is from Osaka to Tokyo--it is like New York to 
Washington--it is about three times the cost that it would be 
in the United States.
    Well, if you consider that this is sort of a new bandwidth 
and is analagous in some ways to energy is in moving systems, 
it is like having, you know, $90 or $85 for a barrel of oil as 
opposed to having $30 or $28.
    So, it is in their own interest if they are ever going to 
develop an E-commerce business and be able to develop effective 
Internet sector to cut these costs.
    The reason why I find that important is that, you know, 
with some of these countries to be able to make the case for 
liberalization you have got to go outside the standard 
channels.
    I was talking actually to a Japanese journalist about this, 
because you have got to make the case to some of the users of 
the systems that they can benefit from liberalization, because, 
just as in our country, the established players, the NTTs and 
the others, they do not want to open up.
    They have got the system that they want, and they make 
money from it.
    So, in some, yes, I think it is a great area of opportunity 
for us.
    The key, frankly, since it is a relatively new area, is not 
imposing a new set of systems on this world of new opportunity 
to start to choke it off, because, frankly, once you start to 
let it grow, it starts to develop its own constituency.
    India is another very interesting example. India has been a 
very close market in so many areas.
    But, the area of India that has been most dynamic has been 
the software industry, and in part it started with the fact 
they developed a wonderful set of engineering colleges, sent a 
lot of their people here, I might add, too.
    But, then, because it was not part of the old regulated 
sector in India, it is a sector that really boomed.
    So, one of the arguments they tried to make to the Indians 
is say look what worked in your own system.
    So, I mean, I do think it has got to be a key piece of our 
overall strategy.
    Mr. Wolf. Are our people at a disadvantage because of 
corruption?
    Mr. Zoellick. Oh, I think that is true in many parts of the 
world, and I think it is one of the reasons why part of our 
overall focus in trade has got to be on transparency.
    It even goes to the basic rules of things, I mean, and it 
is--I talk about this in the Chinese context again, I mean, you 
know where you gain an inch but there are miles to go.
    But, nevertheless, to create a more open and rules-based 
system, you know, even with its flaws I think is going to be 
key to both opening those systems and to creating a competitive 
environment.
    It is true in democratic countries, too. I mean Japan has 
not been very transparent, so that is another part of the whole 
deregulation issue.

                                TELEWORK

    Mr. Wolf. Briefly, we put language in last year mandating 
telework.
    I understand you have made a policy now for a number of 
your people to be able to telework at least one or two days a 
week. Do you want to comment a little bit?
    Mr. Zoellick. Yes, we did institute that policy, and it is 
now available for a large number of the professional staff.
    We also have a flex-time approach, obviously, for some of 
the assistants that are working in the office that--what we 
used to call secretaries.
    It is not as much available for them, but, for the other 
staff, it is.
    But, you know, more generally, Chairman, I have to say this 
is a staff that is in early and works late, and so what it 
primarily allows them to do for good or ill is to sort of work 
additional hours in the evening or on weekends, but, from my 
parochial point of view, that is not so bad.
    Mr. Wolf. The purpose was to take cars off the road and 
give people more choices.
    Also, the productivity of people that are working at home 
is very high.
    I mean, probably most of your people could work at home one 
day a week, and with writing reports and drafting statements 
and things with a laptop and a fax line, it is amazing what you 
can do.
    The International Trade Administration estimate our trade 
deficit with China at $68 billion for 1999.
    Recent estimates I saw in the paper show a trade deficit of 
$85 billion in the year 2000, a deficit increase of more than 
$16 billion in one year.
    American companies are continuing to invest in factories 
and laboratories, thereby increasing Beijiing's ability to 
expand, which concerns China's military capabilities.
    What are your thoughts about are we providing hard currency 
there that could be used against us? What do you--and how--what 
are your plans? What are the Bush Administration plans to deal 
with that growing, growing deficit with regard to China?
    Mr. Zoellick. To a degree, when one looks at bilateral 
deficits, one always has to be a little careful, because it 
depends on who is supplying what.
    I mean, just to give you one little example, we have a 
surplus with Australia. Australia has a surplus with Japan. 
Japan has a surplus with us.
    So, that is partly the nature of the international trading 
system, but, in the case of China, I think a lot of those 
exports are, frankly, exports that are displacing, not U.S. 
positions, they are displacing people, you know, other 
developing countries.
    One of the long-term strategic things I was looking on 
this, given some of your interests, is it is another reason why 
the FTAA, I think, is particularly valuable, because it opens 
markets and opens possibilities for some that may be 
competitors in the Chinese context with some in Latin America 
and offers us some alternative.
    It is always better to have multiple sources on some of 
these things.
    In general, though, you know, it is my belief that, by 
trying to open that system and to open additional commerce and 
trade and put additional rules and develop an additional set of 
a private sector, that it is more likely to move that system in 
the right direction.
    I mean, it is striking to me--it depends on exactly what 
you count--that the estimates are now 30 to 50 percent of the 
Chinese economy is private.
    Now, some of that counts these co-ops and other things that 
are sort of in a mixed form.
    But, I think that that is important in terms of its overall 
economic and political development.
    On the military side, I obviously believe that we have to 
be very stringent in terms of anything that poses any risks in 
terms of leakage of high-tech issues.
    As you know, that is a tough one, because the nature of a 
computer system that might have been high-tech three years ago 
no longer meets that standard today.
    But, nevertheless, I do think it has to be a key part of 
our overall strategy, and I know this is a big subject of 
debate about how you work the export controls.
    One other thing, Chairman, on this. I apologize, and the 
book you gave me mentioned this, too.
    You know, I think Taiwan's success is going to be one of 
the most important elements of the overall transformation in 
China, because--I saw Lee Teng-hui when he was still President, 
and, when I talked to him about this, I mean, you know, people 
have often--in China often talk about the history and the 
culture and how it is amenable to democracy.
    This is a wonderful example of how it works, and I do 
believe that that democracy not far offshore that people are 
aware of, in itself, will be a model of change.
    That is, frankly, one reason why, I think, in our overall 
policies, you know, we have a strong sense of support for 
Taiwan and what it has accomplished.
    Again, there's debates about how to do that and how to try 
to also make sure that it has a peaceful relationship with 
Beijiing.
    But, my overall sense is that what has been accomplished in 
Taiwan will be a very important signal for some of these 
changes in the future.

                 tony blankley, washington post article

    Mr. Wolf. Well, it may be, and you may be right, and I hope 
you are.
    There was a column in the Washington Post a couple of weeks 
ago by Tony Blankley where he makes the case that trade did not 
change imperial Japan, trade did not change Nazi Germany.
    I mean, somebody would be foolish today if they came before 
the Congress and said that we believe the trade with Nazi 
Germany--if we had just traded more with Hitler, that would 
have really made him change.
    I do not think it would have made him change. In fact, 
Winston Churchill was more afraid of Nazi Germany than he was 
of the Soviet Union, because he thought they were a dynamic 
economy.
    So, South Africa, I did not see South Africa changing until 
there were sanctions.
    Some of the time I think you are right. Other times, when I 
look at Nazi Germany and South Africa, I do not think you are.
    That was what I meant when I was talking earlier about the 
statements out of the Bush Administration is like almost 
worshipping at the shrine of free trade across the board 
everywhere, that it will change everything.
    Many times it will, and most of the time it is good. 
Ninety, you know, whatever the X percentage of it is, but there 
are times--up until the beginning of World War II, London was 
trading aggressively with Germany. They had hoped to keep the 
German Army even when the German Army was in Austria and they 
were going into Czechoslovakia, they were still aggressively 
pushing trade.
    Mr. Zoellick. Chairman, I was actually making a point about 
Taiwan's democracy.
    Mr. Wolf. Oh, yes.
    Mr. Zoellick. On the point you are making--you refer to my 
writings--I actually pointed out to people there was a guy 
named Norman Angel----
    Mr. Wolf. Yes, out of the book.
    Mr. Zoellick. You know, about economic integration leading 
to peace, well, it does not always work that way, so I mean I 
believe you need to have a strong defense and promote democracy 
but also look for the role of open markets.
    Mr. Wolf. I am glad you read that book. It came out in 
1937, and that was--'38.
    I mean, that was going to make all the difference, and 
military was irrelevant.
    How many people died in World War II? Fifty-some million 
people.
    Mr. Zoellick. That was actually pre-World War I.
    Mr. Wolf. Yes.
    Mr. Zoellick. But, you are right. He got the Nobel Peace 
Prize in the '30's.
    Mr. Wolf. I am glad you understand that. Let me just cover 
one or two more.
    You triggered the other thing. Is the trade with China 
dislocating the potential trade--in Singapore and some of the 
others?
    Are we decreasing trade them by our activity with China? 
Does that make sense?
    Mr. Zoellick. Yes. I think it is less Singapore, because 
Singapore is already up the value-added ladder.
    Mr. Wolf. The Philippines?
    Mr. Zoellick. But there is no doubt that countries in 
Southeast Asia feel the competitive pressure of this.
    Again, you know, my own view of this is not to close off 
trade with China but to make sure that we are open with trade 
with some of these other countries who have been allies and 
have their own struggles along the way.
    Mr. Wolf. Yes, and also there is the whole concern about is 
China an emerging market that we can sell to, or is it a place 
that Boeing is going to go to and manufacture the aircraft and 
stay there and never come back?
    That is--I mean, you all must have people smarter down 
there than--but, there is a difference, isn't there?
    Mr. Zoellick. Well, the two, Chairman, are often linked, 
and I will use Japan as an example.
    What often happens is that trade is increasingly following 
investment as much as vice versa.
    It is the nature of the way a lot of businesses operate is 
they will have various components and assembly and others.
    So, frankly, part of our problem with Japan over the years 
is that, if you look at the foreign direct investment in Japan 
compared to other places, it is very, very low.
    That is one reason why they do not buy as much from us, 
because you don't get the integrated operations.
    One reason why, frankly, given their financial problems, if 
they ever price their assets correctly, it is important to 
allow our guys to go in and buy more things in Japan, because I 
think it will help overcome some of the trade imbalance.
    But, China has actually been relatively open in terms of 
the investment flows, which, for the long run, you know, could 
be good on the trade side.
    It leaves the other questions that I am sure you would want 
to focus on, too, though.

                            wto transparency

    Mr. Wolf. Well, you know, I guess you are right. I was told 
the other day there are a number of the family members of the 
ruling leaders of China who are living in the United States and 
doing business in the United States.
    Yet, we cannot get our airplane back, and the difference of 
the story could have been 24 young, brave Americans die had 
that pilot not been skilled.
    Frankly, I think the pilot is a hero, I mean, had he not 
done what he had done.
    Yet, that very government, its leaders--their children were 
very tied into certain businesses living in the United States 
and sharing in our freedom.
    Yet, the father back in Beijiing--I don't know. I have a 
difficult problem.
    Let me talk to you about the World Trade Organization. By 
its very nature, it arouses suspicions. During the debates, you 
said you talked to people, because you have an international 
body making decisions that directly affect U.S. trade policy.
    One of the issues is the openness and being--how open and 
transparent its proceedings are.
    What about having it more open and accessible? I mean, some 
of the worst days in Congress were when we were closed and no 
one knew how we were voting.
    Now, everyone knows how we are voting. We are very open. 
Could the WTO have more openness, more transparency?
    Mr. Zoellick. I think it could and it should. Just to put 
this in a little context, though, and going back to the 
conversation with Mr. Kennedy is that sometimes people have 
this image that WTO is this behemoth.
    It is about 500 people. I mean, our contribution is about 
$15 million compared to 70 to the ILO, so, you know, in some 
ways, it is now sort of the mindset that it is this poisonous 
octopus, but it is actually a pretty small thing.
    I think your point is exactly right. It is that, in terms 
of being able to convince people what it is you, you have got 
to make it more open in terms of its processes.
    There are certain things we can do unilaterally and do do.
    In other words, when we have a case, we put our information 
out in the public and we urge the party from the other side to 
do it publicly.
    We have proposals about trying to open up hearings and 
ideas related to it.
    We also frankly, when we file cases, we put a notice in the 
Federal Register on our side to try to seek comment about how 
we are trying to approach it.
    We have urged others to at least give us summaries of their 
positions which we could then so use to make public.
    We have also urged the release of panel reports. This is 
another way, though, Chairman, where I referred a little bit to 
competition and liberalization.
    We can create models in other contexts. For example, with 
this Jordan free trade agreement, you know, we took a series of 
positions to try to advance transparency and create a little 
bit of a model.
    You know, we have--the briefs are public, the public 
hearings, opportunity for amicus participation, report release.
    We also agreed that, if the WTO disputes with one another, 
they would follow these procedures.
    So, what, frankly, has happened is that, for a number of 
reasons, some of the other countries are fearful of this, some 
of them for reasons that I do not think are good and some of 
them it is just not--you know, a lack of understanding.
    But, I believe a key part of our policy has got to be to 
try to promote transparency where we can unilaterally and 
otherwise with the Organization.
    It is another topic that I tried to talk about with the EU, 
frankly, because I think it is where we can have some common 
ground.

                           conflict diamonds

    Mr. Wolf. The last question I will have, and then I will 
recognize Mr. Serrano, is I know you are aware of the issue of 
conflict diamonds--diamonds exported from Sierra Leone and 
other war-torn countries, the Congo.
    We know these diamonds are funding guerilla leaders who are 
responsible for human-rights atrocities--cutting off of arms--
the diamonds coming out of Sierra Leone and Liberia.
    Are you looking at this, and the World Diamond Council has 
raised concerns that restrictions on diamond imports are 
contrary to U.S. international legal obligations under WTO and 
cause trade friction with our trading partners.
    Can you tell me what the Administration is going to do to 
stop the funding of warlords who are cutting off the arms of 
women and children?
    The whole issue in the Congo is being driven by diamonds. 
Three million people have died in the Congo in the last three 
years. A couple hundred thousand in Sierra Leone. The Kennedy 
Hospital in Liberia is closed down.
    Diamonds, diamonds, diamonds. I hope--and I know--I have 
talked to some people in the government, that they are saying 
all the right things.
    But, you are kind of a lead on this. I really hope that you 
can cooperate with the State Department and with the Treasury 
Department to really come up with a legitimate policy that we 
get control.
    The problem will be, if we do not do it, there is going to 
be a boycott of diamonds.
    Mr. Zoellick. I agree with you.
    Mr. Wolf. A boycott of diamonds will hurt the legitimate 
diamond merchants, jewelers, and also the people in poor parts 
of Africa that are relying on the diamonds.
    So, I would hope you could kind of be involved and help out 
so we could come up with a good policy that would end this.
    Mr. Zoellick. I agree with you, Chairman, and I see it--I 
mean, I have gotten involved with this issue, and what I see is 
the balance on this is, on the one hand, you want to have an 
effective system to try to stop the illicit trade.
    You know the United States has some Executive Orders, and I 
believe there is another one being looked at with one of the 
countries that you mentioned that may be in short order.
    The other side of the problem is it is a product that is 
hard to mark in a way, and so how do you make sure that you do 
not trip up the South Africas, the Botswana, the Namibians, you 
know, African democracies that are also diamond producers.
    One of the ideas that I have had, because I know some of 
the people involved--in fact, actually I think Ted Sorensen has 
been involved with this, too--is to say, look, this is one 
where the private diamond producers have got to sort of step up 
to the table and figure out how to, you know--they are in the 
business--help us do this, because, if it does not happen, 
there will be a consumer reaction, like you said.
    It is bad business for them as well as bad for these 
countries involved.
    There is a process, I understand, called the Kimberley 
process, that is trying to address some of this.
    So, I share your interest in it, and, frankly, you know, my 
concern, while obviously we have to try to do this in a way 
that supports international trade rules, but, to me, the core 
issue here is how to do in a way that does not upset the 
legitimate producers and democracies while dealing with this 
problem.
    I read the same stories that you do, and they turn my 
stomach, too.
    Mr. Kennedy. I would just like to add I totally agree with 
you, Mr. Chairman, on this. We need to do something and do it 
quickly.
    You know, having you speak out like you just have and 
encouraging others to adopt a policy on this is really, really 
important.
    Mr. Zoellick. Well, the other thing is, again--well, my 
door is certainly open for you or others you talk to--you have 
ideas about how to actually solve this difficulty about 
identifying whose diamonds are which or what set of systems on 
this.
    You know, that is going to be the difficult issue. I mean, 
I think we all know where we want to go on this.
    Mr. Kennedy. I would appreciate having you invite some of 
those other leaders.
    Mr. Wolf. Yes, you ought to meet with Congressman Tony 
Hall, too.
    He has a good Bill and that I am a co-sponsor on, but I 
think, if you could take the leadership, that would be very 
positive for the kids that are losing.
    I mean just everyone's life in Sierra Leone is miserable.
    I don't know if you knew the hospital named after your dad 
is closed.
    Mr. Kennedy. No, I did not.
    Mr. Zoellick. Well, I had already asked, Mr. Chairman--I am 
trying to remember the name.
    He is a businessman that has been associated with your 
family and been very involved with Africa and diamonds.
    Mr. Kennedy. Yes, Maurice Templesman.
    Mr. Zoellick. Yes, and I talked to Maurice about some 
African things, and I said we ought to try to see, look, you 
know, how can we get some people together on this on the 
private-sector side to see how to deal with it.
    Mr. Wolf. Mr. Serrano.
    Mr. Kennedy. Well, obviously, we will just work together.

                          democracy and trade

    Mr. Serrano. Thank you, Mr. Chairman. You know, when I 
listen to the discussion initiated by the Chairman, I just 
realize more and more every day how really much accomplished we 
are in the country in terms of how we conduct trade, who we 
conduct trade with, and then what we attach to it.
    You know, I am such a strong believer that we have to re-
establish relations with Cuba.
    Yet, I hear us talk all the time about democracy, and I 
wonder if we, when it comes to our foreign policy--comes to our 
trade policy, we seem to deal with countries on a case-by-case 
basis.
    We do not apply an overall litmus test, if you will, but, 
when we talk about democracy, we seem to apply one, which is a 
country that has an election similar to ours, regardless of who 
wins, and how he or she behaves afterwards, they are okay.
    I have often--in fact, I said this to Secretary Powell the 
other day when he came before us, I said, you know, maybe I am 
mistaken and maybe years from now I will realize I made a 
terrible mistake.
    But, I sort of measure this word ``democracy'' two ways--
two places, north of the Texas border and south of the Texas 
border and this part of the world.
    North of the Texas border, it is clear to me what democracy 
is. I am exercising it right now.
    South of the Texas border, I wonder if democracy is having 
an election and having 40 percent of your children on the 
street with no shoes or having a socialist government where no 
child is homeless.
    Which one is the real democratic of the two? Is it the 
democracy of the hundred thousand missing children of Colombia?
    Is it the democracy of the missing people in general of 
Argentina? Is it the democracy of the illiteracy of Haiti?
    Or, is it a lack of democracy of the universal healthcare 
coverage of Cuba and the nearly 100-percent illiteracy rate of Cuba?
    But, I always wonder how it is that we come to these 
conclusions?
    Of course, we tie this President and that President's hands 
on the issue of Cuba.
    It never stops to amaze me how we talk about what and who 
we will trade with. I mean, you are doing it yourself, and I do 
not blame you.
    It is the American party line. You know, it is not 
partisan. It is what we say, well, China is making changes, but 
we never allow Cuba to make any changes.
    You know, people say, well, what are you suggesting? That 
we trade with them, and then what?
    Well, if you trade with people, you can talk to them. You 
isolate them, you don't talk to them, you can't put any demands 
on them, because you are not doing anything for them.
    Therefore you have no right to step in, but, you know, one 
of the advantages in my life is that I read Spanish.
    One of the difficulties that I deal with every day is that 
I read reports that come from newspapers in Latin America that 
tell you the truth about what is going on with all these 
wonderful democracies that we are dealing with and that we want 
to help.
    You know, let me speak to another question, but how do we 
determine who our new trading partner or favorite trading 
partner will be.
    I see now this season that it is Chile. What has Chile done 
to merit that in comparison to others?
    Mind you, I am the guy that wants to trade with everybody, 
so, you know, I am being some sort of a slight wiseguy and 
saying why Chile? What has Argentina not done to merit special 
treatment?
    What has Colombia not done? We interfere in a civil war, 
and we are going to get into deep trouble, but that is another.
    I can bring you 15 issues in the next 15 minutes, but how 
do we determine that Chile now merits this special treatment?
    Mr. Zoellick. Well, first is that, you know, one of the 
reasons that you read some of those things going on in those 
countries is because they are more open and they are more 
democratic.
    I was going to make this point to the Chairman earlier on, 
what I saw in the Soviet Union. I dealt with those issues.
    I also saw what happened when the Curtain came down,.
    Mr. Serrano. With all due respect, Ambassador, is there 
anything happening in Cuba that we or CNN do not know about at 
this point?
    Mr. Zoellick. You know, from the lesson of what we learned 
in the Soviet Union, I suspect there are a lot of things that 
are bad that we do not know about.
    I mean--and I have to admit this. I mean, this is something 
that I learned about the Soviet Union. I mean, I was shocked to 
the degree to which some of the things that occurred there that 
none of us really knew, I mean, and related to things that are 
dangerous even in terms of weapons programs and other things.
    But, the point I want to make--I realize there's very 
sensitive discussions about Cuba and I understand that topic--
but I just wanted to talk about democracy in the region, 
because I do feel this is an extremely important issue, is that 
I agree it is more than elections.
    I mean--and it is creating, you know, a role of minority 
and rights and creating some ongoing system and creating the 
role of a free press and others.
    But, I think this is so critical to this region at this 
time, because it started to move in this direction.
    But, if you also say, you know, when you have got one out 
of three kids that are in high school and the rest don't make 
it, it is not going to work.
    So, how do you also try to help build the overall system, 
and that goes to your question on Chile.
    We are trying to support a free trade agreement with all 
the countries of the region.
    The first reason that Chile got a special treatment was 
that President Clinton had proposed to them a deal in 1994 they 
were not able to deliver on.
    In December of 2000, he started to launch it, and so we are 
carrying forward with that.
    But, there is a good reason why Chile came out, and that is 
Chile has been a more open society in terms of both its 
economics and its politics.
    I could see this when I was down there. It has a much 
richer civil society, so, frankly, one of the reasons that we 
are going ahead with Chile, in addition to carrying on what was 
handed to us--and that it would be bad if you didn't--was--is 
to send a signal to others in the region that good performers 
can move faster.
    That partly affects the whole region, because, you know, 
frankly, we are not ruling out the possibility of free trade 
agreements with others if the Free Trade Area of the Americas 
slows too much.
    We would rather do it as a region, because we think, as a 
region, we will create a better framework for some of the 
things we have a common interest in.
    But, one of the reasons we are going ahead with Chile is to 
send a signal to people that, if others are not ready to move, 
we will move with those who are.
    Frankly, I think that Chile's story in terms of restoring 
democracy and in terms of its economic openness is a pretty 
good story that we want to try to encourage.
    But, just to take another one, and I apologize for going 
on, is Central America.
    You know, I dealt with those issues in '89 and '90--the 
bloodletting of those civil wars, and I thought one of the 
saddest things was that we were not able to follow up and try 
to give some additional support for regional integration and 
democracy in trade.
    It is one of the issues we are looking at. In the same 
context, we have got to look at some of these labor rights and 
other issues.
    So, I do think you can use trade in these agreements as a 
catalyst for reform.
    But, I also agree with you it is not the end all and be 
all. It can't be the sole part of your policy, so the question 
is how do you integrate.
    Mr. Serrano. Well, I hope we do pay attention to that, 
because I know it is pretty much a losing battle. We have got 
some things in place as to who we trade with or do not trade 
with.
    But, it just seems to me that we are talking out of both 
sides of our mouths if we think that we can affect change and 
then, when change is not affected, if the partner is bigenough, 
we kind of look the other way.
    Mr. Wolf is right. Chairman Wolf is right. I mean, tell 
me--I am not asking. It is just my closing statement, but what 
has China done under that political system different than Cuba?
    I know what Secretary Powell said, well, they are making 
changes. I have not seen any election different than Cuba.
    I have not seen any system of government different than 
Cuba. I have not seen any distribution or lack of distribution 
of the wealth different than Cuba.
    What I do see is I do not see a county like Miami-Dade 
anywhere in the nation that handles our policy on China.
    If we had one somewhere in this country, then we would not 
be in a Cold War with China.
    So, so much for some communities not having a lot of power.
    Mr. Zoellick. Thank you.
    Mr. Wolf. In closing, I agree with Mr. Serrano in that we 
come with different results.
    I am opposed--I support the Administration's position on 
Cuba, but I think he is right.
    If you had to look at the difference between Cuba and 
China, he makes a very powerful case, because, given the 
conditions--and I have not been to Cuba--I am going to go--
given the conditions, I will stipulate that they are not 
selling organs in Cuba, they are not imprisoning 14 Catholic 
bishops, they don't have 150 House Church pastors, they are not 
plundering 3,000--three years ago, we snuck into Tibet. We went 
in the back door with a young man who was a Tibetan monk who 
looked just like us.
    He took us into the bowels of the monasteries, and we heard 
stories of people.
    So, Mr. Serrano is actually right. Now, I think he is very 
consistent.
    I am very consistent, because I do not want to grant PNTR 
to China, because I think they are fundamentally, to quote my 
favorite President other than George Washington, they are the 
E1 party. You can get a new kidney transplant for $50,000, go 
into the prisons, take your blood type and their blood type, 
and they execute them.
    I have it on film. In fact, some day I am going to ask you 
to come by and let me give you a 15-minute presentation.
    These are the socks that we picked up off the line for 
Tienanmen Square demonstrators.
    So, while our conclusion is I think the Administration's 
policy is right with Cuba where we would differ, but I think it 
is wrong with China.
    So, he is right. He makes a very powerful case as I sit 
here and listen to him.
    Mr. Serrano. If I may interrupt you a second, I am 
promoting a program in my history to get Colombia University 
and Ulsters Community College to begin to train people at the 
blessings of the State Department to train minorities for 
foreign service.
    That is not a racial or ethnic statement. It is just a 
belief that I have that, if you had more people making 
decisions who understood everything that happens in different 
places, then you might have a different read.
    You know, who is the dictator? The one who won, in quotes, 
an election and then keeps the kids without shoes and big 
bellies on the street or the one who feeds every child?
    I do not know the answer to that, but I know that the 
democratic leader who keeps the children hungry can't be as 
good as we claim he is or she is.
    That is my problem. That is what I do not know how to deal 
with.

                          fast track authority

    Mr. Wolf. I have one last question. The fast-track 
proposal, for how many years will that be for?
    Mr. Zoellick. We haven't----
    Mr. Wolf. The shorter the better.
    Mr. Zoellick. We have not set a specific time.
    Mr. Wolf. Well, you know, I do not want you to come by. I 
do not want to be lobbied. I am going to do what I think is 
right and go home and talk to my wife and pray about it.
    I don't care what I get, what mail I get, who calls me.
    But, I think the shorter--now, I tell you you said some 
good things today. I am undecided.
    I do not know what I am going to do, and I do not want to 
get a call from the President, and I do not want to get invited 
down. I do not want anything.
    Mr. Zoellick. I am sure that is easy, Chairman. Everybody 
else wants things.
    Mr. Wolf. I don't want anything, but I think the shorter, 
the better, because, you know, as a Republican and as somebody 
who thinks George Bush is a good person.
    But, on the other hand, George Bush was not with me when I 
was in a Beijiing Prison, number one.
    George Bush was not with me in Tibet. George Bush was not 
with me in Sierra Leone.
    George Bush was not with me in the Congo. George Bush was 
not with me in Sudan. He has not been with me in East Tiwari.
    He has not been with me, so my life experiences are 
different than his, and George W. Bush will never be there 
because he can't as President, and Colin Powell will never be 
there.
    So, it is not a criticism that they have not been there----
    Mr. Zoellick. I understand.
    Mr. Wolf [continuing]. But the shorter the better, and the 
more you talk about human rights when you talk about 
environmental and labor protections, I think they are 
important, too, because then it raises my comfort level.
    But, I could never vote for a permanent one, so the shorter 
you get it within reason--I am not talking about three months 
and then you have got to come back again--but--because then it 
is a test.
    It is a fleece you put out there to see how the thing 
works.
    Then, you prove you are all right, and I say, well, you 
know, those guys are right.
    You know, I think you are a good person, you have a good 
record, you have a lot of good people that work down there.
    I think the President is a good person. I think his heart 
is in the right place.
    But, there are some of us who just--so the shorter the 
better. Anyway, thank you very much.


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                                           Wednesday, June 6, 2001.

            NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION

                                WITNESS

SCOTT B. GUDES, ACTING UNDER SECRETARY AND ADMINISTRATOR
    Mr. Wolf. Welcome to the committee. And I have an opening 
statement which we will just submit for the record in the 
interest of time.
    We left off with the hearing on your budget, and as I 
recall, when Secretary Evans testified, it was 63 percent of 
the Department of Commerce budget. So we are anxious to hear 
from you.
    With that, I will just submit my statement, and I recognize 
Mr. Serrano.
    Mr. Serrano. Thank you, Mr. Chairman.
    I just want to welcome you, sir. And I can say there is no 
secret that I am a big fan of NOAA and the work you do and, I 
hope, the work you will do in the future, so I am eager to hear 
your testimony to see which way we can help.
    I must note that staff tells me that while you submitted 55 
pages of testimony, you submitted detailed budget information 
pretty late, so you give friends like me a hard time trying to 
help you. Keep that in mind, because I am not going to read 
some 55 pages, but I will look at some numbers.
    Mr. Wolf. I will just state, for the record, I read the 55 
pages.
    Mr. Serrano. I read it too this time.
    Mr. Wolf. I know.
    Mr. Serrano. I will give them a choice.
    Mr. Gudes. I have a short version, 5 minutes.
    Mr. Wolf. No. Whatever--it is important; you should take 
whatever time you feel--I don't think you should read the 
entire 55 pages, but I think you should, you know, take as much 
time as you feel comfortable with, and then the full statement 
will appear in the record.
    Mr. Gudes. Thank you, Mr. Chairman. I tried to cut it down 
pretty significantly last night, so I will run through it. I 
had provided some slides to the committee. I think I will 
probably do them a little out of order because I tried to cut 
them down.
    Mr. Chairman, Congressman Seranno, Congressman Cramer, 
members of the committee, on behalf of my boss, Don Evans, the 
Secretary of Commerce, and 12,500 men and women that we have 
working around the country, I want to thank you for this 
opportunity to come talk about the fiscal year 2002 budget for 
your National Oceanic and Atmospheric Administration, or NOAA, 
as we say.
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               Opening Statement By Undersecretary Gudes

    Mr. Gudes. I also want to thank this subcommittee for its 
long-standing support of our Nation's oceanic and atmospheric 
program. You have really supported us, and I would especially 
like to thank the outstanding professional staff, Christine 
Ryan, Gail Delbalo, Sally Chadbourne, Lucy Hand and others. It 
is really a pleasure for us to be able to work with the 
committee staff over the years.
    Mr. Chairman, I would also like to recognize my management 
team that I have here today, my components of NOAA. I have 
Sonya Stewart as my Chief Financial Officer, Chief 
Administrative Officer; Jolene Lauria Sullens, who is my Deputy 
Chief Financial Officer and Budget Director; Margaret Davidson, 
who is the head of the Ocean Service; Bill Hogarth, who is the 
head of the Fisheries Service; John Jones, who is the Deputy 
head of the Weather Service; Louisa Koch, who is deputy head of 
NOAA Research back here; Greg Withee, who is the head of NOAA 
Satellites; and Admiral Fields, who is head of the Office of 
Marine Aviation Operations.
    As you know, I am Acting Administrator and have been since 
January. I am actually the Deputy Under Secretary, the chief 
career position in the Agency. But we do operate NOAA as a 
team, and it really is a synergy where all the components 
actually provide for, I think, a better product and better 
servicing of the American people than all the single components 
by themselves.
    For 2002, the NOAA budget totals $3.152 billion. That is a 
decrease of $61 million from the year before, from the 
appropriation year before. Those top line numbers don't 
necessarily tell the whole story. There are a lot of puts and 
takes going on. There is about $330 million in reductions; 
there are about $270 million in investments.
    I think that it is fair to say, Mr. Chairman, that I have 
been working with the NOAA budget since the early 1980s, when I 
was at the Office of Management and Budget. I think this is the 
best NOAA budget submitted by any administration in terms of 
responding to the core mission, core values, the really 
important signs and services that the Agency needs to meet and 
to really keep us a premier oceanic and atmospheric agency in 
the future.
    I won't go through all elements of the actual investments. 
Let me just say the following: This budget first invests in 
people. It takes care of our mandatory costs--in the budget 
business, what we call ``adjustments to base.'' This is my 
highest priority. This is the highest priority in the budget, 
adjustments to base, taking care of our people.
    Number two, it invests in infrastructure, in the 
facilities, in the ships and the backup systems. And it is an 
area that NOAA in past years has not done a very good job in. 
We have not tended to look at what we need to do in terms of 
the infrastructure to maintain this agency. So I am very proud 
that this budget does provide some $34 million of increases to 
deal with this sort of--these issues.
    The science and services I talked about, climate science 
and services, very important obviously, global warming, 
seasonal climate, MTS or Marine Transportation System, from the 
safe navigation--doing what we need to do in terms of our 
nation's ports and the maritime industry. This is NOAA's oldest 
mission. This goes back to 1807, long before anybody dreamed 
that there would be a NOAA, when Thomas Jefferson said, we need 
to map and chart the Nation's ports and harbors.
    Modernization of NOAA's fisheries, very important area in 
terms of our national resource management.
    Coastal conservation programs like coral reefs and marine 
sanctuaries and, of course, satellites and severe weather. And, 
of course, we are reminded just today, with Tropical Storm 
Allison coming into Texas, just how important that part of our 
mission is.
    I want to make three other points from my slides if I 
could. First, I want to talk about what this committee, the 
subcommittee, what your constituents get from the investment 
that you approve in the National Oceanic and Atmospheric 
Administration.
    There is a slide that looks like this. It says Management 
Improvements. I will just mention two. This slide, National 
Hurricane Center Atlantic Track Forecast Errors; what that says 
is that since the mid-1980s we have reduced the errors at 72 
hours for hurricane traffic forecast from about 400 nautical 
miles to 200 nautical miles. A lot of those improvements came 
in the last 7 or 8 years.
    It is a great example of what supercomputing can do and 
what modeling can do, getting the data into supercomputing 
models, like the observation systems, like our satellites, a 
significant difference. We can do better, like 24 hours, we got 
from 120 miles down to the 80s. So it is very significant.
    Acquisition reforms, I know there are a few people here on 
the staff that remember that in the early 1990s the satellites 
that you see on television, called GOES or geostation 
satellites, we were down to one satellite in this country, and 
frankly, it wasn't supposed to last as long as it did.
    In 1991 or so, we had a real procurement disaster on our 
hands and a lot of people from Congress and the industry and 
the agencies got together. There were a number of changes, 
there were acquisition reforms that took place in NOAA. There 
were some personnel changes. There was work with Bernie 
Schwartz from Loral Corporation. We brought Lincoln Labs in.
    The bottom line is, now, 10 years later, we have three 
geostation satellites in orbit, one in cold storage. It is 
ready to be turned on when needed. These are our, if you will, 
severe weather sentinels that will track the hurricanes, what 
we are talking about, and tornadoes. It is the satellite you 
see on television.
    We are about to launch the last of our Loral satellites 
on--July 15, I think, is the current date. So we are actually 
in a really robust system in our geostation satellites as we 
move forward to the next generation with Hughes, Boeing. So 
that is a really good news story of acquisition changes.
    There are a number of items in this budget that have to do 
with hurricanes and numerical modeling. We have the U.S. 
Weather Research program, which has an increase of $3.7 million 
total. There is $3.8 million for the Joint Data Assimilation 
Center, which is a partnership with NASA and NCAR, National 
Center for Atmospheric Research, and $93 million for geostation 
satellites.
    Hurricanes is an area that we spend a lot of time on. I 
would just like to point out that in 1998, good news and bad 
news, in terms of where we have come, where we are going, 
Hurricane Georges--Georges, somebody here that speaks French 
can tell me how it is supposed to be pronounced.
    It came over the Keys, Key West. We were lucky; it didn't 
intensify. It came in as category 2--it did not go as high as 
we thought it might--and 48 hours later we said that hurricane 
would come into coastal Mississippi, and 48 hours later it did.
    Hurricane Georges pretty much came on track. It had a 
little bit of changes, and people in New Orleans got some 
water, but the model worked. The system worked. The National 
Hurricane Center, working with FEMA, we got the word out. 
Everything worked perfectly.
    Hurricane Mitch was that same year in about November. 
Hurricane Mitch downgraded to a tropical storm. None of the 
models, NOAA's models, the Navy's model, the European model, 
nobody foresaw this hurricane going and heading South into 
Honduras and lingering like Hurricane Agnes did.
    And this is 98 years after the Galveston hurricane where we 
lost over 8,000 people. So it shows just how far we still have 
to go in terms of hurricane modeling and research, and that is 
one of the reasons why we have these investments in the budget.
    Finally, Mr. Chairman, we have an image here, which is 
www.noaa.gov, that is sort of a part of our Web site. We have--
I think it is the last slide in your package. This is something 
we worked on very hard at NOAA.
    Three years ago we had a very solid Web site, but it was 
something you really needed to be inside the government to use, 
or be inside NOAA really. We really redesigned that. There is a 
lot of work and a lot of talented people at NOAA. It is how we 
get our information in the Information Age out to our public 
and out to the constituents, our customers. It has made a big 
difference. We are usually in the top eight Web sites in the 
government. When there is severe weather going on, like last 
night, we often go up to number one or two quite often.
    I believe that part of NOAA's mission is the education, the 
training of the next generation of meteorologists, 
oceanographers, marine scientists, IT experts of tomorrow; and 
that is persuasive in a number of our programs, but this Web 
site actually is a big part of that.
    For me, one of the really great things in this job is to go 
around the country and meet teachers and students who 
continually come up to me and say, you guys have the greatest 
Web site, and I was able to learn about whales or my daughter 
was able to learn about tornados and really navigate through 
this.
    So it has been a very, I think, good way to get the 
investments, that you have put into us in terms of the 
information we produce, the science, back out to the American 
public.
    That is my opening statement.
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    Mr. Wolf. Well, thank you very much. What you do is very, 
very important.
    And my favorite weatherman is Willard Scott. How does 
Willard Scott feel about your service?
    Mr. Gudes. He actually did a tape for us over at the Air 
and Space Museum about polar satellites. If you go over there, 
you will see it.

                         New NOAA Administrator

    Mr. Wolf. When will you have a new administrator?
    Mr. Gudes. Is there an envelope somewhere?
    Mr. Serrano. Will it be Willard Scott?
    Mr. Gudes. I don't know that. I think the person to ask was 
at the last hearing.
    Mr. Wolf. What is your indication?
    Mr. Gudes. I know there have been a number of individuals 
who have interviewed. There are a number of names that have 
been out there since January, very qualified people--
scientists, people working in climate, people working in 
oceanography.
    NOAA has been very fortunate, Mr. Chairman, in that we 
actually haven't had that many administrators since the 
creation of the Agency. Bob White was the first administrator, 
under the Nixon administration, went all the way to 1977. Dr. 
Baker, our last administrator, was from 1993 till last January. 
And they tend to be oceanographers by training, or 
meteorologists; and the real answer to your question is, I just 
don't know when.
    But my commitment is to continue to do everything that I 
can do within my capability to run the Agency as well as I can 
until I leave.
    Mr. Wolf. I am sure you will and I am sure you can. When 
there is a vacancy, though, particularly with 63 percent of 
your budget, this ought to be one of the priorities.
    I think the administration saw what happened by having a 
vacancy up at the UN with regard to us being voted off the UN 
Human Rights Commission and also on the Narcotics Commission; 
by not having an ambassador there, different things happen. By 
not having an administrator, although I know you are capable 
and can do the job, I think it makes a big, big difference.

                     NOAA vs. Coast Guard--Charting

    Why does NOAA do the charting and not the Coast Guard? I 
know there has been a little creative tension between the two 
agencies, some things, but a lot of cooperation.
    What was the history of NOAA doing the charting and not 
Coast Guard? Is not the Coast Guard older than NOAA?
    Mr. Gudes. The part of NOAA that goes back and is in charge 
of mapping goes back to the old coast survey is probably like 
something like 7 years younger than the Coast Guard, I think. I 
think the Coast Guard was started in 179--what, somewhere 
around there, 1790; and we started in 1807 in terms of this 
mission.
    I don't know what the discussions were at that time about 
who does what, but the Coast and Geodetic Survey and lineage of 
our NOAA corps and part of the National Ocean Service goes all 
back to 1807, and that has been our mission. Some quite famous 
people actually have been involved in that mission over time: 
General Armitage; Whistler, the famous painter. It went all the 
way through to the Department of Commerce, when the Department 
of Commerce was created in the beginning of the century.
    In 1964 or 1965, when NASA was created, the Coast and 
Geodetic Survey was one of the elements, it was brought 
together with the old Weather Bureau and with the research 
component of NOAA.
    It has always been--as far as the Coast Guard, we have a 
very close working relationship in a number of areas. In the 
case of mapping and charting, in the case of tides and 
currents, that is our mission; in the case of maritime safety 
and above, is theirs. In the case of fishers information, they 
do that. In the case of search and rescue, SAR agencies, we 
give the signal off of our polar satellites as they go for 
Doppler shift, that message goes to the Coast Guard and the 
Coast Guard performs the rescues, and some 12,000 people have 
been saved over the last 20 years.
    But in terms of mapping and charting, I believe that the 
other agency that does this is the Navy, which does it 
overseas, or NEMA or the Navy. In the case of domestic waters, 
it is NOAA's mission.
    Mr. Wolf. Was there ever any proposal to merge the two?
    Mr. Gudes. In the original Stratton Commission 
recommendations in the late 1960s, that was----
    Mr. Wolf. Was that Congressman Stratton?
    Mr. Gudes. Julius Stratton, was he a Congressman, does 
anybody know? I don't think Julius Stratton was.
    But in the original Stratton Commission in the late 1960s, 
which gave birth to NOAA, the original proposal was for an 
agency that included not only NOAA, but the Coast Guard.
    Mr. Wolf. That is what I thought. Wasn't that during the 
Nixon administration? I thought there was a proposal to merge 
the two.
    Mr. Gudes. Right.
    Mr. Wolf. The Coast Guard is kind of hanging out there. 
They're neither fish nor fowl, and they have a difficult time 
because when many of the other uniformed agencies are being 
addressed, sometimes the Coast Guard gets left behind. It just 
seems in some respects that the merger of the two--but it was 
just an idea.
    I just wanted to see if there had been any reason or why 
the charting was given to you and not to the Coast Guard.
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                               Satellites

    With regard to the satellites, where are the satellites 
launched from? You mentioned Loral. I know Loral was launching 
satellites in China.
    Your satellites are not launched in China.
    Mr. Gudes. No. We launch from the United States.
    Mr. Wolf. Where do you launch them from?
    Mr. Gudes. Two places, our geostationary satellites are 
22,000 miles that you see on television are launched out of 
Kennedy, out of our Space Center there. NASA is actually our 
agent, and Christine Ryan was at the launch last year. And we 
have another one in July.
    For our polar satellites, because the orbit they need to be 
in, they orbit in the same orbit and the globe turns below so 
they cover the whole globe. They are only about 500 miles above 
the Earth. They are launched out of Vandenberg Air Force Base 
in California just like a number of other polar satellites.

             International Climate and Weather Datasharing

    Mr. Wolf. Also, with regard to the data, how available is 
the data that you have with regard to Africa, whether it be 
Mozambique or whether it be in Sudan or where another famine is 
taking place or things like that. Do you share that information 
on a long-term basis with the African governments and the 
governments in certain parts of Asia and Latin America, or is 
it just on the Web for them? Or is there an interaction and an 
aggressive saying to the President of Mozambique, we see what 
is taking place here, and we think there is a potential for 
major flooding, as you had last year, and you should be 
prepared? How do you deal with that?
    Mr. Gudes. Especially in our satellite programs, not only 
in our satellite programs, NOAA is a global agency. And in 
fact, our polar satellites are the world's meteorological 
environmental satellites.
    They do not only do weather. They see sea surface 
temperatures. They do imaging. They do search and rescue that I 
mentioned. They do a number of things that I mentioned.
    We work pretty closely through the World Meteorological 
Organization which--NOAA is the U.S. Rep, Jack Kelly, who is 
with Weather Service. He goes to Geneva all the time. And Ray 
Whitney is here, who is always going over with the European 
trade agencies and working with them to provide this sort of 
free and open exchange of information.
    Mr. Wolf. But some of these countries are so poor. The 
country of Mozambique, the government is kind of hanging on 
like this, and Kenya and some of the others, where they have 
horrific famine, and Ethiopia where millions have died, and in 
Sudan.
    Do we aggressively call? Do we say, there is an accident 
waiting to happen, and with the climate changes that we have 
seen, what the projections are, and so therefore you ought to 
be alert? Do we reach out? Because many, many of these 
countries are having a hard time just existing. And obviously 
they don't have a sophisticated weather service and their 
people are not necessarily attending conferences.
    How do you get this information to them? Or could we be 
doing--with the good work that you are doing, could we be 
taking a more aggressive approach, calling the President of 
Mozambique or saying our projections show that next year, based 
on the climates that we are seeing and the current, we believe 
as of 2 years ago you had a major flood, you may be very well 
having the same thing. Therefore, the preparation for how you 
plan, what you do, how you harvest--also working with the NGOs, 
World Vision, Save the Children, AID, do you transfer this 
information to AID and all the governments?
    How do you do that, or is it just kind of, you take 
advantage of that?
    Mr. Gudes. I want to say, yes, a few times to the comments 
you made. First, I did put a slide in your package about 
Mozambique and the flood that we did----
    Mr. Wolf. I saw that.
    Mr. Gudes [continuing]. And the assistance to Ethiopia. We 
are trying to work all the time with other countries.
    There was an initiative that was funded last year I think 
we know called it hazardous--national hazards information, 
which is basically--which you just described is basically 
theconcept of doing a better job to get all sorts of data not just from 
NOAA's satellites, but all types of satellites, getting that 
information to them, as well as----
    Mr. Wolf. Do you contact them?
    Mr. Gudes. Yes, sir. And we do work with AID and we----
    Mr. Wolf. For the record, give me some examples of what you 
have seen taking place and what governments you have contacted. 
Have you contacted the Sudan Government with regard to that? 
Have you contacted the Kenyan Government? Have you been in 
touch with the Mozambique Government?
    And this is not to find out if you haven't done something 
right. This is not an inquiry to say that you have made a 
mistake. It is just that there is something--you know, a lot of 
times we have so much data that we--I mean, and what we have 
here are people trying to find out over there and to put the 
two together.
    I wonder if it would not be a good thing for you, in 
cooperation with AID, on a monthly basis, to say to the African 
governments, the Third World governments, here's where we see 
things are. They have ambassadors here in town, and otherwise 
they may be--I mean, you are going to have 40 million kids with 
AIDS, orphans in Africa in the year 2015. In their minds, they 
are going to be concentrating on other things.
    Are there ways that we can, with the good information, the 
good work that you do providing information to other 
countries--since we already gather, this is not spending more 
money. This is not a new program. Are there ways that we can be 
proactive to help them?
    Mr. Gudes. I will come back to you with a paper.
    I think my answer is, all parts of NOAA, not just the 
satellites that I focused on. We are a global agency and we 
work with a lot of countries.
    In the case of satellites, what I mentioned before, the 
polar satellites, they actually are the environmental 
satellites. They will download into most of these countries 
that we mentioned, and these other nations' meteorological 
services. And absolutely, in terms of disaster assistance, in 
terms of flooding, the Weather Service is very involved with 
the Ocean Service in Honduras, Hurricane Mitch follow-up, 
trying to help that not to happen again.
    [The information follows:]


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Wolf. I know that we did not respond very fast on 
Mozambique, that was the complaint the Mozambique people saw 
what was going to take place in Mozambique; and their economy 
was just improving. They maintained they didn't know, and we 
were very--the West, I will put it that way, was very late in 
responding to Mozambique, not to get--again, I don't want this 
to be--this is not an inquiry. I am just asking you, can we do 
some things better?
    But did the Mozambique Government know 6 months before 
time?
    If we wanted to do that, can we do that? Maybe we can chat 
about it and see if there are some things that we can maybe be 
proactive in helping--anything that can help the poor that 
doesn't cost more and more money. If we can share this 
information, you know, we would do it.
    Mr. Gudes. Mr. Chairman, we will do that, and we would be 
pleased always to respond to you and take a look. And I will 
also get back to you and say what specifically happened in the 
Mozambique flood situation--what we did, what we did right, 
what we did and what we didn't do right.
    Mr. Wolf. All right. I am not looking to place blame.
    What was done--is there a way, looking at Mozambique and 
Sudan, so that--is there a case study? Are there some things 
that we can, on a proactive basis, just knock on the door and 
say, Mr. President, we see this taking place, we have called 
your ambassador in--so we are going to tell you that every 
month we are going to have this update and, obviously, we can't 
make you do something, but we just want you to know.
    Mr. Gudes. Yes, sir.
    Mr. Wolf. The accuracy of the weather forecasting, not so 
much in hurricanes and not so much can you go to the beach or 
anything like that, but what is it with regard to agriculture 
and different things, has the weather accuracy gone up over the 
last 10 years? Has it stabilized? Is it dropping?
    You might just want to share some thoughts and then maybe 
submit some things for the record.
    Mr. Gudes. The accuracy has gone up. I think the accuracy 
of our 3-day forecast has the same accuracy that our 1-day 
forecast would have had 10 years ago. So when I tell you that I 
believe that in northern Virginia it will likely rain and be 89 
degrees 3 days from now, 10 years ago that would have been the 
accuracy of just the next day. So we are getting better.
    It is not about observational systems. It is very much 
about computer systems, supercomputer. Every time we listen to 
the local meteorologists or the Weather Channel, they talk 
about the models, they are our models. It is about simulating 
the atmosphere and how big the measure is, how big the box is. 
The smaller we get it, the more computer power, the more data. 
It is about data simulation, getting those measurements, 
getting them in and getting a better model. The better those 
models are and the better the observations are, the better the 
forecast is. And they are improving.
    In the case of tornadoes, I can give you an example; it is 
on your page. In the early 1990s, we had very little lead time. 
We are up to 10\1/2\ minutes now. That is one specific 
observing system largely, not only.
    Mr. Wolf. With additional resources or emphasis, what can 
you get that up to?
    Mr. Gudes. Our goal is--where we are right now on tornadoes 
is 10\1/2\ minutes.
    Mr. Wolf. We have lost a lot of people in tornadoes.
    Mr. Gudes. Yes, sir. In the case of tornadoes, we are now 
at 10\1/2\ minutes of lead time on average. Larger tornadoes, 
better lead time.
    In the early '90s, we were down to--I want to say 6 
minutes; I am trying to find my chart--6 minutes in 1993. We 
are 10\1/2\ minutes now. Our goal, I think, is to get up to 
about 16 minutes.
    Mr. Wolf. That is possible?
    Mr. Gudes. Yes, sir. Part of this is about our weather 
component, part is our research component. We have a national 
severe storm laboratory in Oklahoma, which is looking at 
leading edge technologies: polarization radar, which can give 
us better returns, phase-in radar, which may be able to take 
tornado lead times up to 30 minutes or so using totally 
different things.
    It is our environmental modeling center right over here off 
of Camp Springs, which is for modeling. And they are, every 
year, improving those models; and the models, every year, are 
getting more and more accurate.
    My first point about people, I think we have the best 
weather service in the world.
    Mr. Wolf. I do too.
    Mr. Gudes. And I think it is about training and it is the 
professionalism, and you put those things together and I think 
the answer clearly is, yes, we are getting better. Yes, we are 
going to get better still, and it is about the total team. I 
mentioned satellites. I mentioned research. I mentioned the 
weather service, and our forecast skill is getting better.
    And the only other thing I will say, increasingly where I 
think you are going to see us go as an agency is better climate 
forecast, long-term weather forecast.
    You can see that in terms of California with El Nino, NOAA 
jumped out in the early 1970s talking about the need to put 
buoys across the Pacific so we could take a look at what was 
going on with the water's temperature. And we said, that will 
affect weather, and we said, that is interesting research.
    In 1997, people believed us, and when we forecasted El Nino 
ahead of time, there were significantly higher rains than 
normal in California. That is about climate, it is about 
seasonal forecast and where we are going as an agency, what our 
strategy is and where we are moving to be able to get more and 
more accurate on the seasonal forecast as well.
    And so when we say it is going to be wetter or colder than 
is expected and get that accuracy down so that maybe there is a 
point where I would be testifying here as the Deputy Under 
Secretary, whatever, a few years from now and I would be able 
to tell you 1 week from now the forecast will be as accurate as 
that 3-day forecast. And I can tell you, if you go back to your 
district in California, this is what you are going to say. And 
guess what? It would be much more accurate and that is where we 
are going. That is the whole thing.
    Mr. Wolf. Thank you.
    Mr. Serrano.
    Mr. Serrano. Thank you, Mr. Chairman. I think that could be 
a future program. Before we leave every week, we get a forecast 
for our district, so I would have known what it was going to be 
like in New York on Sunday. There was a big parade.
    The way you spoke, unless I just don't understand the whole 
satellite issue, you made it sound like you launch satellites 
regularly.

                     LIFE CYCLE OF NOAA SATELLITES

    How regularly do you do them? What has happened to the ones 
you have already launched?
    Mr. Gudes. Satellites have design lives. It is a tough 
environment, and they actually are almost like works of art, 
very expensive. A geostationary satellite with a launch is 
about $450 million for about 5 years of service. And as I said, 
it just shows you there is a design life to it.
    So some satellites last the full design life, some last 
longer.
    Mr. Serrano. Which is about 5 years?
    Mr. Gudes. For geostationaries, yeah. For polar, what are 
we forecasting? Three--3 to 4 years for a polar satellite. This 
gets to when you have to fund them, too, Mr. Serrano, when you 
are going to need to start a contract it has to do with.
    You always have an assumed design life. You have an actual 
performance; and then, every now and then, accidents happen and 
you lose one on launch or you lose one that just went up. We 
have had that happen before, and that changes the whole array.
    Since we buy these in threes, fours, fives, this is part of 
the real issue in the satellite business. But, yes, we do 
launch all the time, yes.
    Mr. Serrano. Now, as far as outer space-traveling hardware 
up there, how many that are ours there are not in operation?
    Mr. Gudes. How many that belong to NOAA are not in 
operation? There are different levels of operation. Some only 
have just a few sensors, still working PSAT. The PSAT program 
provides educational assistance. Those are old geostation 
satellites that we used to use for communications capabilities. 
They will be in geosynch orbit.
    Some of the polar satellites we launched, Polar 12 was the 
NOAA-D we launched in 1991. It still has some instruments 
working on it and has some capabilities. So we try to use 
everything we can.
    Satellites in the polar orbit trend to drift out of orbit, 
so they become less effective in the Weather Service. In 
general, we try to use everything that is still lasting, but 
they are not--are they boosted out at some point? When they 
lose all final value, then we put them out in deeper space.
    In the case of polars, they will continue to orbit in polar 
orbit--not in the same orbit as we put them in. As I said, they 
tend to drift.
    Does that answer your question?
    Mr. Serrano. Yes. I thought they were up there for longer 
than 5 years, but I guess not. That is an interesting thought.

                              NOAA WEBSITE

    First of all, let me thank you for the fact that your Web 
site does provide a lot of information. You have bailed our 
family out a few nights when I certainly didn't have the answer 
about whales.
    Mr. Gudes. We have whale languages on there under the 
specific marine environment where you can actually listen to 
different types of whales around the world.
    Mr. Serrano. It is amazing.
    Mr. Gudes. It is great.
    Mr. Serrano. No, really, I want to thank you for that. But 
it leads me to a question.
    How much does it cost to operate the Web site? I ask that 
question only because there are folks that come before us that 
tell us they can never have a Web site because it costs too 
much. You do have an exciting one.
    Mr. Gudes. At headquarters, we have very few people who 
actually run, the actual NOAA Web masters; and we have been 
consolidating the number of servers, trying to do it more 
efficiently. The reason I have a hard time answering your 
question is because the reason you can navigate everything 
within our agency, every NOAA activity has a Web site and puts 
their information out.
    If you go to the Coastal Services Center Web site through 
the National Ocean Service, if you clicked on NOAA.gov and went 
to Oceans, you would find an array of fascinating products that 
they put out there for the public to use.
    But I don't know the answer as to how many Web masters, how 
many people we have responsible for dealing with the Web 
throughout the Oceans. My guess is, to a fuller extent, it is 
extensive. My answer in part is that that is part of doing 
business nowadays, that is part of how you put your products 
out there.
    Mr. Serrano. No. Absolutely, I don't have a problem with 
that.
    I just wonder, because it can--if it is too much--if it is 
a lot of money, it helps other people claim that they can't do 
it. And if it is not an extravagant amount of money, then we 
can convince other people to do a better job.
    Because eventually one of my newsletters lists X amount of 
Web sites that people in my district can go to. In a short 
paragraph, I may give them access to more information than I 
can give them in the next 10 years of newsletters by just 
having them click on.
    Mr. Gudes. Right. I actually believe, in terms of running 
the Agency, that this is part of doing business in this century 
and that any agency that is not putting out effective Web sites 
can't get products out.
    I will get back to you for the record.
    [The information follows:]

               Estimated Costs of Operating NOAA Homepage

    NOAA's Office of Public Affairs, High Performance Computing Center 
(HPCC), and National Environmental Satellite, Data and Information 
Service (NESDIS) estimate that their annual operating costs for NOAA's 
Internet homepage at www.noaa.gov. total $179,000. This estimate 
reflects the operating costs of only the main homepage, its supporting 
system, and a backup mirror server.

                     MINORITY SERVING INSTITUTIONS

    Mr. Serrano. For minority-serving institutions you have 
requested $15 million again for next year. I would like to know 
how the program is going and what is taking place.
    Mr. Gudes. We are pretty excited about it. We have had a 
lot of people this year. We pushed forward much quicker than I 
think a lot of people thought we could in implementing the 
program, and kept with the program that we came up here and 
explained to you last year. So we have moved out with a 
competitive procurement for the four science centers--Remote 
Sensing, Environmental Science, Atmospheric Science, Marine 
Science. We have gotten proposals in, yes.
    I just met--so that program is moving along, about $2\1/2\ 
million roughly per site; and we have a number of teams, not 
just individual institutions, across the country, Hispanic-
Serving Institutions, Historically Black Colleges and 
Universities, Native American Consortium. We have really been 
succeeding in getting a lot of proposals in, which can be very 
difficult to narrow that, though.
    Secondly, we have a scholarship for undergraduates. I met 
with the first seven students from Florida A&M. We have 
students from North Carolina A&T, from the City University of 
New York, from really all over the country. That is moving 
forward.
    Environmental entrepreneurship, which is probably the most 
innovative part of our program, we are about--we just did go 
forward. The announcement is now out that will be looking at 
specific projects where we can work with minority-serving 
institutions in terms of real-world issues.
    I often use oyster restoration or marsh restoration on the 
Chesapeake Bay as a good example of where we might be able to 
do something like that.
    We have the graduate science program, which is the idea of 
hiring graduate students from minority-serving institutions and 
coming into NOAA. We had that program in the early 1970s and it 
went away. We reinvigorated it. We started it. It is not cheap, 
but it really--John Jones, the head of the Weather Service, he 
came out of that program.
    Finally, I do have about $300,000 of the total fund that I 
put out for discretionary projects. For example, I am going to 
be funding, at Cal State University, a consortium. There is a 
Marine Science Center out in Wrigley in Catalina where a number 
of students can't afford to go there and work on marine science 
for 6 months.
    So what we are doing is working with the State universities 
to underwrite a program where they can afford to do that where 
they can get that same sort of experience and get marine 
science. That is an example. I can go through all of them.
    Mr. Serrano. When do you think we will get dramatically 
past the stage we are at now and we can see the program in full 
force?
    Mr. Gudes. I think within the next few months you will see 
really where the centers of excellence are, which teaming took 
place. I think the environmental entrepreneurship program will 
be something that will go every year and you will see different 
participants.
    I have a bit of a selfish standpoint on this program, 
because I believe this is part of doing business right. It is 
part of looking at our workforce, it is part of remaining 
competitive, and it is part of realizing that we haven't, as an 
agency, done a good enough job in our first 30 years of 
recruiting and retaining people who are diverse in terms of 
racially, in terms of our background.
    I looked at this program as a way to really build better 
partnerships, because we do have some partnerships, and we have 
been spending some money, and this is really building some sort 
of a connection. So my goal is those universities--my goal is 
those students' scholarships are going to come to NOAA, and 
they are going to be working for us as our employees.
    I want to do a maximum job of doing that. So that is what I 
will do if, in fact, it has had all the impact that I hope it 
has.
    Mr. Serrano. And the $15 million, that will keep you at the 
current level?
    Mr. Gudes. Yes, sir.
    Mr. Serrano. Well, I certainly will continue to support 
you, and I know that this committee--I can't overemphasize how 
important this is for many of us. I know Ms. Roybal-Allard is 
extremely interested in this also, as are members from both 
sides, because as you say people will have the opportunity to 
gain this expertise and have the ability to show their talents.
    It is really good for all of us. It is not just good for 
them. It is good for the country. So I hope you continue to do 
this work. We will continue to help you.
    Mr. Gudes. Thank you.

                           ISLAND OF VIEQUES

    Mr. Serrano. In fiscal year 2000, $40 million was 
appropriated to the Defense Department. As part of an agreement 
the previous Administration had with the then governor of 
Puerto Rico relating to the Island of Vieques, which as you 
know is the island in the news with the bombing and the arrests 
and all the tragedies that are taking place. I understand a 
portion of those funds was transferred to the Commerce 
Department to address environmental and economic concerns.
    First of all, what is the status of those funds?
    Mr. Gudes. It is $3.85 million, and we are still working to 
develop an agreement with the Navy to get those funds 
transferred. We are still working on a vehicle, as I understand 
it. There is another meeting tomorrow.
    The breakout is $1.8 million for artifical reefs that is to 
bring back some of the fisheries. $500,000 for coral reef 
restoration; and $1.5 million for payments to commercial 
fisheries.
    Vieques is a priority to us, and we are still working to 
get the resources.
    Mr. Serrano. Without getting you to make a comment about 
another part of our government, which I know you won't do, even 
if I try to get you, what is the holdup? Why is the Navy--I 
mean, the Navy continues to be seen by everybody in Puerto Rico 
and anybody involved in this issue as the bad guys in this 
whole drama, so what is their problem with you doing the work 
that you have to do?
    Mr. Gudes. I really don't know the full answer to that 
question. I know there was discussion originally or there were 
proposals to do the financing and every agency separately. The 
decision was made in the last administration with the Congress 
to consolidating in the Navy.
    I found in any number of agreements, memorandum agreements 
they always take longer than one expects that they should; and 
I, frankly, don't know what the specifics are about this.
    Mr. Serrano. Now, do you think it is related at all to 
continuing the bombing? In other words, can what we want to do 
be done while they continue to do what they are doing? Or is it 
that we can only accomplish it at here what is actually step 
one, which is hopefully the day when they will no longer be 
bombing? Which then brings up the question that I dare not ask 
you, because they will use it as an excuse to stay, which is 
how much would it cost to clean up. And I know you have told me 
in the past that it is costing in the hundreds of millions, if 
not billions, of dollars to clean up the mess that took place 
there.
    Mr. Gudes. I don't know exactly where off of Vieques. I 
know part of the Island is reserved as a training range. I know 
part of the Island is not. I have to apologize, I do not know 
where these reefs are specifically located.
    For example, the artifical reef may be the west side of the 
Island, which is not part of the training range. I just have to 
get back to you, Congressman.
    Mr. Serrano. Please. I would appreciate it.
    Last year, Dr. Baker and I talked a little about NOAA's 
work with the Navy on assessing or mitigating the environmental 
impact of Navy activities, but we didn't directly discuss what 
is known about the impact Navy training has had on the 
commercial fishery around Vieques. To your knowledge, has there 
ever been a scientific assessment of the impact of the bombing 
and does NOAA have the authority to conduct such a study?
    Mr. Gudes. I don't know. I don't know. I don't know if we 
have such an assessment. I understand it is very preliminary.
    Mr. Serrano. What does that mean?
    Mr. Gudes. We took a look at some of them----
    Mr. Hogarth. We did the sea turtle research and located the 
sea turtles and removed sea turtles from them in----
    Mr. Serrano. Sea turtles?
    Mr. Hogarth. Yes. And they moved those and put them in 
protected nesting sites. And that type of work is--as far as 
fisheries is concerned, there is very little work done on that 
fishery.
    Mr. Serrano. Now is there another place under the American 
flag--how many other places are there under the American flag 
where you folks have to try to do some work as the military is 
conducting exercises?
    Mr. Gudes. We have--you are talking specifically in terms 
of the coral reefs or military exercises?
    Mr. Serrano. Any of the things you folks do.
    Mr. Gudes. We work with the Navy, all the military services 
in a number of areas. We are responsible sometimes, for 
example, on the impact on marine mammals. There is a fairly 
well-known issue having to do with low frequency sonar right 
now where we were asked for comment out in public hearings on 
something called LFA.
    We deal with the military service in a number of other 
areas. When I was talking before about meteorology or 
satellites, in fact, it is a joint partnership. We operate the 
Air Force's defense meteorological satellites, for example, for 
the Air Force. So it is a pretty close relationship in a number 
of areas.
    On coral reefs, they are part of the National Coral Reef 
Task Force which I cochair. The Navy is a member of that, and I 
think it is very expensive.
    Mr. Serrano. There are similar situations of Vieques in 
Hawaii I am told.
    Mr. Gudes. In Hawaii, it was an island used for a bombing 
range by the Navy for quite some years. I believe that that 
ceased back in about the 1990 time frame, so there are 
definitely a lot of cleanup areas that can be cleaned up and 
areas that can't.
    I know a little bit about that issue. I frankly know about 
that from my work on the Defense Appropriations Subcommittee in 
the other body. So I don't know from a NOAA perspective what 
kind of work was actually done. And Dr.Hogarth is telling me 
that----
    Mr. Hogarth. Off in North Carolina, there is several 
testing sites in North Carolina that the military uses that are 
off limits to fishing. We and the States work quite a bit with 
them on that. There are follow-up studies in the areas as to 
what they are and how to keep people out of the areas.
    It hasn't been quite as controversial, except some of the 
commercial fisherman have a hard time keeping them out.

                         MARINE PROTECTED AREAS

    Mr. Serrano. Let me just ask one question and then allow 
other members to ask questions.
    I understand Secretary Evans has just announced that the 
administration will retain the executive order on the 
multiagency marine protected areas initiative. Please discuss 
what this program will do and what NOAA's role will be, how 
existing programs such as the reserves and marine sanctuaries 
will fit in and how the $3 million requested for the Department 
of Commerce will be used.

                            MARINE PROTECTED

    Mr. Gudes. Areas is an international term. I learned that 
in the last 6 months or so. It sort of means a lot of things to 
a lot of people. Definitely some people have gotten very 
interested in it as a concept.
    But it really means areas of special--that are special that 
are in the marine environment. They can be--have a lot of 
protection, a closed area all the way to almost no protections. 
It can also be a way of maintaining fisheries management in an 
area.
    NOAA runs 13 marine sanctuaries and one in the Great Lakes. 
The other is on the different oceans, and those are MPAs. NOAA 
also runs 25 national estuaries research reserves that are also 
MPAs. The MPA policy that came forward said take a look at all 
MPAs. There are many more in the State governments. For 
example, in the United States, California has quite an 
extensive system. NOAA plans to get a full inventory of them 
and take a look at best practices and management measures.
    It also called for an advisory committee. The Secretary 
said that the executive order would stand, that we will manage 
the marine protected areas program in a way that conforms with 
existing law. For example, the Channel Islands Marine Sanctuary 
in California currently has proposals to expand the boundaries, 
to look at special unique areas that will be dealt with in the 
way of looking in the local advisory group and through the 
Marine Sanctuary Act and through the different laws that 
pertain to that.
    We in our budget have about $3 million, to do a better job 
on the science of marine protected areas, taking a look, for 
example, where we have closed areas, where we do, for example, 
in the Florida Keys that will do this preserve, taking a look 
at how much impact there are on the fisheries in that area, in 
the corals in that area.
    We run that--we have one person doing that now in Santa 
Cruz in our new fisheries lab in Santa Cruz, California. The 
proposal would be to beef that up.
    And we actually have a training outreach effort for MPAs 
which is based in Charleston, South Carolina, at the Coastal 
Services Center, again which is part of--one person--and part 
of that $3.1 million would move into that.
    So it is really about taking a look at marine protected 
areas, that generic area overall which includes partly NOAA, as 
well as outside of NOAA.
    Mr. Serrano. That does it for now, Mr. Chairman.
    Mr. Wolf. Mr. Vitter.
    Mr. Vitter. Thank you, Mr. Chairman.

                       MARINE NAVIGATION SERVICES

    Thank you, Mr. Gudes, for being here. As you know, you 
visited my office, and a lot of my concerns are in the area of 
marine navigation services. That is enormously important to our 
country and to our economy.
    You know, over the last 50 years, the length and width, the 
draft of commercial vessel basically doubled, if not more, and 
yet in the NOAA budget, marine navigation services, I think it 
is about 3 percent.
    From my perspective, there is a historical tilt, an undue 
tilt in the NOAA budget toward more academic research and away 
from basic nuts and bolts, marine navigation services, which 
are very important to the economy. And, after all, NOAA is 
under the Commerce Department. I just want your reaction to 
that basic technique of the overall budget.
    Mr. Gudes. I had mentioned before, I think, that it is our 
oldest mission for the Agency, for the core of our mission, and 
it is an area I think that probably in past years didn't--
probably didn't get the level of funding that it should have 
been.
    I think it was realized in the last few years. For example, 
4 years ago, we didn't have funds for private contracting for 
hydrographic surveys. We have now about $20 million in our 
budget for that. We have, as you know, reduced the fleet in 
terms of our own ships, and we are now down to about three of 
our hydrographic ships that do that. It is about 4 percent of 
our budget.
    But I do think that, Congressman, you are exactly right. 
When you take a look at EEZ, the United States has the biggest 
EEZ of any country, and when you take a look at the critical 
areas to get charting to go way beyond what we should do, when 
we take a look at the capacity of other countries, I think we 
still have about 32,000 square nautical miles of critical 
backlog. That is about the critical backlog.
    If you take a look at where we rank, if you take a look at 
our government assets, we are about 38 in the world in terms of 
our ability to do mapping and charting. If you include those 
private assets, we are closer to about 18 or so in the world. 
That still puts us behind Mexico and a number of other 
countries.
    So I do think we need to do a better job on the surveys. We 
need to do a better job on using the survey data, that is our 
electronic navigational chart initiative, where we changed our 
theory of how we are trying to get this data out and put it out 
for the private sector, making a use of products.
    And I couldn't agree more that we have to look at the 
maritime system in the same way we look at the aviation system, 
as we look at the service transportation system in this 
country; and NOAA MTS, as we call it, is actually a pretty high 
priority.
    Mr. Vitter. Again, I think what you are saying and the 
statistics you are laying out underscore my point, and I hope 
members of the committee can focus on this through the budget 
process in the oldest historic mission of metal and what you 
just described as the core of your mission is 4 percent of the 
budget.
    And that goes directly to the commercial impact of the 
maritime industry, which is sort of the biggest day-in, day-out 
impact NOAA can have on our society and our economy.
    Just an example, that current funning levels it is going 
to--at your current funding levels it is going to take more 
than 20 years to complete topographic surveys for just the 
countries' critical navigational areas. That is a little over 1 
percent in the area of backlog, so that is the most important 
area. A little over 1 percent for everything, and it is going 
to take over 20 years to get it done.
    To me that is just an unacceptable mix in the overall 
budget, and I would hope in this subcommittee we can move over 
the next few years--I understand that can't be done overnight--
we can move over the next few years to a more balanced ratio in 
terms of overall funding levels, because, again, this has 
enormous significance to the economy. A single inch of draft in 
terms of a ship can yield between $8,000 and $50,000 in 
additional revenue for a single port that over the course of 
the year, that can mean hundreds of thousands of dollars to 
revenue in a port. We are just losing that because we do not 
have the charts. And that draft may be there, and, of course, 
the ship can't take the draft.
    Mr. Gudes. Can I add it is also about the water levels; it 
is also a very, very current, accurate meter reading to get GPS 
to get the exact heights. That is what we call the maritime 
issue as well. And I do think this is a credit to my people. 
This is probably the area of NOAA where we have worked the most 
closely with the private sector. When we do our strategic 
planning workshops and we bring in our constituents, more than 
half of those people come in and they were pilots, et cetera, 
and it is very important.
    Mr. Vitter. I think we need to do a couple of things. We 
always need to be spending money in that area. We need to be 
spending more efficiently and wisely. I think you are moving 
more to contracting out and maybe in the future to shorter 
vessels.
    That is one thing that is important, but the other thing 
that is just as important is the amount and the percentage of 
the budget, and when the, quote/unquote, core of your 
commission is 4 percent, in my opinion there is something out 
of kilter. Specifically in my neck of the woods, Gulf 
Intracoastal Waterways between Florida and Texas, also Mr. 
Cramer's general area, they are the busiest waterways in 
America, and yet NOAA was has not put out new charts in that 
area for many years. I wonder if you could comment on that for 
the Gulf Intracoastal Waterways in particular.
    Mr. Gudes. Actually there is an enormous amount of 
commerce, about 150 tons shipped annually in that area. I 
actually went to a briefing on this issue, and they are 
actually arguing that NOAA should get a priority on Gulf 
maritime commerce. It is not. A lot of our energy resources 
come in through those ports. We could make a bigger impact by 
trying to focus.
    I should mention when we talk about private and public 
charting on the Gulf issues, it is 100 percent private 
charting, and because of the large cost, it is an area where we 
can make a bigger dent quickly. But it is about getting the ENC 
as produced and the demands of the user. And the Chairman 
talked before about the Coast Guard getting involved in this, 
it is not about NOAA getting involved in this, but we are very 
excited about this, and I think it is the right thing to do.
    Mr. Vitter. I also want to ask you about the mix of where 
you do the work. It is my understanding of the critical 
backlog, it is roughly about the same to be done in the Gulf as 
in Alaska, roughly 1,500 square nautical miles, and in the last 
15 years NOAA spent 15 million in Alaska compared to 3.5 
million in the Gulf. I think that is the same in this year's 
budget. Why is that appropriate?
    Mr. Gudes. I am trying to find a way to catch up with you 
here. I know the largest amount of critical backlogs in 
Alaska--I think the 3,200 square nautical miles areening, we 
have made significant progress in bringing down the backlog at 
the coast. I am looking at a chart that shows we went through 
some of that backlog starting out about 1996, just below 
15,000. In the case of Alaska, it looks like we have gone from 
20,000 down to about 16,000. I know that some of the technology 
issues are a little bit more difficult in Alaska because of the 
type of bottom we have, the type of sonar. We need multibeam 
sonar. But I think we are making progress in both areas. But 
definitely both are a priority to us.
    Mr. Vitter. Well, again, just in terms of the area, I think 
Alaska is roughly 15,000, the Gulf is roughly 13,000, and we 
have what in my view is a huge disparity in terms of funding 
levels, 3 to 1, 10 million to 3\1/2\ million. So I would ask 
that you all look at that.
    Mr. Gudes. Is that the project?
    Ms. Davidson. First, the Gulf, the backlog is resurveyed, 
some of which is the early part of the latter century. In the 
Gulf of Alaska there are areas that have never been charted 
previously. So the backlog is recently charted. Until quite 
recently there was a limited maritime transit in Alaska. Now we 
are taking very large cruise vessels into uncharted waters in 
Alaska. So why actually the uncharted area in Louisiana is 
substantially more than anywhere else in the country--and the 
traffic is heavier in the Gulf of Mexico than anywhere else.
    Mr. Vitter. They are roughly in parity in terms of work to 
be done?
    Ms. Davidson. Yes. In terms of scope of resources, the fact 
that we had never charted a number of significant passages in 
Alaska, and the growing number of cruise industries and the 
number of accidents----
    Mr. Vitter. Well, again, I am not arguing against the work 
in Alaska. I think there is an imbalance, and there is plenty 
of need in the Senate to be an imbalance. I don't think you 
need to do the Senators' work for them. You can present a 
budget that is balanced, and we will take it from there.
    Mr. Gudes. Yes, sir.

                      LONG-TERM VESSEL CHARTERING

    Mr. Vitter. Mr. Gudes, you and I have talked about long-
term charter opportunities. There are some entities around the 
country, including some in Louisiana, who are eager to get into 
the long-term charter business for NOAA that do it for other 
areas of the Federal Government, where they say they can build, 
operate a vessel in conjunction with NOAA, get a lot more bang 
for their buck. What is the progress you see on the horizon for 
NOAA taking advantage of some of those opportunities?
    Mr. Gudes. I think this is an area that we haven't--in 
terms of what we are doing, I think NOAA could be criticized 
years ago, but that is not true now. This charter idea that we 
are talking about where we actually lease a ship and do 
charting full time, we haven't done that. I think talking to 
NOS, talking to Captain David Farland, we actually find that to 
be a pretty attractive idea. We would like to do that. I think 
in an area like the Gulf, that could have quite a bit of 
impact.
    The OPTEMPOS--I have met with some of these ship guard 
groups. The operating tempos they say they can get are quite 
high, and the idea of having a team on a NOAA ship is a good 
idea, but that is not in your basket right now, but we will 
take a look at that.
    Mr. Vitter. When concretely will you take a look at that?
    Mr. Gudes. We have been taking a look at it. The budget 
that you now have does not have a proposal for a lease charter. 
It does have about $20- or $25 million for a private 
contractor. It has a renovation of a private vessel in terms of 
keeping our fleet. The first chance that I would be able to 
deal with it would be a proposal in the next administration's 
budget, but as you can appreciate it, we are a long way away 
from having a President's budget in the next fiscal year. In 
terms of the administration, it will be a next budget process 
that we can raise that issue.
    Mr. Vitter. In this budget you mention the renovation of a 
ship in your fleet. Describe the ship, the amount of money and 
the renovation we are talking about.
    Mr. Gudes. It is the FAIRWEATHER. It has been in fresh 
water in Lake Union in Seattle. It is the sister ship to the 
RAINIER. The RAINIER is the most productive mapping and 
charting vessel we have, very productive. It has six launches, 
a very talented crew. It produces a lot of mapping and charting 
data in Alaska same as you talked about before.
    Last year the Congress came forward actually and gave us 
funds to modernize the FAIRWEATHER. We have made an agreement 
with the House Chairman from Alaska Don Young, Senate Chairman. 
The President's budget includes funds to work on the launches, 
and that is $16.3 million of which $9.5 million is in this 
budget, $9.5 is in the 2002 for the second increment, for a 
total of $16.3 million to activate the FAIRWEATHER, and it will 
come on line in 2003.
    Mr. Vitter. The ship is 30 years old?
    Mr. Gudes. The ship is----
    I am sorry, Congressman. The FAIRWEATHER has been actually 
kept in very good condition in mothballs in our Pacific Marine 
Center. It is fresh water, so it is a very benign environment 
for a ship. It has six launches.
    The RAINIER is a very effective platform. The ship is about 
30 years old. With this renovation we think we could get, I 
don't know, 20 years or more service out of it.
    Mr. Vitter. What does service cost per year?
    Mr. Gudes. For staffing and operation, it would be $4\1/2\, 
5 million or so; full operation, $6 million. RAINIER costs 
about $6 million a year to operate fully.
    Mr. Vitter. I don't know what the answer to what I am going 
to lay out is, but I do think it is important to ask the 
question. We have a 30-year-old ship. We have $16\1/2\ million 
to renovate it for maybe 20 years. We have $6 million a year to 
operate it. Have you done any analysis of what we could get for 
that chunk of money, which is significant, in either private 
chartering services or long-term charter, which would all be 
done in Alaska? I am not trying to grab that work elsewhere. We 
could keep it in Alaska. I am just saying have we done a cost-
benefit analysis of spending that chunk of money in different 
ways?
    Mr. Gudes. We have done some work with Mitretek. I don't 
know if we have done the level of comparison that you are 
talking about, Congressman. I do know that every time I go back 
and talk to our people about the options, people say, yes, that 
ship is 30 years old, but it is an excellent ship, it has a lot 
of capability, and that when we look at what we get out of our 
existing expenditures for mapping and charting, the RAINIER 
goes off the charts in terms of what we get. It is like three 
times more productive at least at this point in time. It is 
about three times more productive in terms of square nautical 
miles in terms of what we chart.
    We believe that having another platform like the RAINIER 
makes a lot of sense. We already have the platform. It is a 
question of activating it. And we have--in NOAA we had about $1 
billion in ship modernization in 1990. We had about 20 ships at 
that time. We did not get that, obviously. We have put together 
ships when we can. We have had brand new 1990 ships that the 
Navy laid up that we were able to bring back into service, 
which we are using towards ocean research and fisheries. We 
think by renovation we can get an asset and some productivity 
out of it.
    Mr. Vitter. Again, the answer to the question may be this 
is the thing to do, but I don't think we have really asked the 
question or answered it in a disciplined way. And I think we 
are talking about $16\1/2\ million on a 30-year-old ship, $6\1/
2\ million a year. I think we should ask the question and do a 
rigorous analysis: What do we get over 20 years on that amount 
of money on private charter and on the long-term lease? 
Certainly the long-term lease question has never been asked or 
answered.
    Mr. Gudes. I can give you my personal opinion. I thinkgiven 
the magnitude of the problem you described, how much backlog we have, 
that is just the critical backlog, that we really need both, I think. 
In terms of the agency, we need an internal agency. We need to keep 
hydrographic expertise. Our number of hydrographic personnel, which 
goes back to the beginning of the country, we start out about 11 
hydrographic ships in 1970 when the agency was created. We are down to 
three. We have four with the FAIRWEATHER.
    My own view is that whole application is the right thing to 
do, that we need to have an internal dubbing capability. We 
need to maintain the expertise. We need to do more private 
sector contracting. And I think these charter ideas are a very 
attractive complement to that bag in terms of moving forward, 
and in terms of moving forward.
    Mr. Vitter. Well, particularly with the lease, the charter 
option, it seems to me doing that if it is more economical 
versus having a government ship has no necessary impact on 
outside expertise because they are going to be in-house folks 
who work on and with that ship whether it is privately-owned 
and leased or whether it is government-owned. So, again, I am 
not sure how exploring these options really has to be against 
this sort of application and internal capability that you are 
talking about.
    Mr. Gudes. I think we should, and I will go back and find 
out what the status is of the Mitretek study that was talked 
about, and we will come back and share that information with 
you and consult with you if you feel that is not sufficient. 
And if we need to move forward in terms of analysis, we will do 
that.
    [The information follows:]

          Cost-Benefit Analysis of Long-Term Lease/Chartering

    The National Oceanic and Atmospheric Administration (NOAA) is 
responsible for charting the 3.4 million square nautical miles (snm) of 
the U.S. Exclusive Economic Zone (EEZ). Nearly 500,000 snm of that area 
are considered navigationally significant, of which 80 percent are in 
Alaska or the Gulf of Mexico, and are in need of surveying. In 1994, 
given its limited ability to address this huge responsibility, NOAA 
identified 43,000 snm of this area as being the most ``critical'' to 
survey in terms of vessel usage and safety issues. Today, 32,500 snm of 
this critical survey backlog remains, and with NOAA's current mix of 
inhouse and contract capabilities, it will still take almost 20 years 
to eliminate the backlog. Given the magnitude of this problem, it is 
clear NOAA needs to do more, and that employing a mix of assets is a 
reasonable approach. While operating inhouse vessels is necessary to 
maintain the expertise required to ensure accurate nautical charts, 
utilizing the capabilities the private sector can bring to bear on this 
problem makes good sense as well.
    To help ensure that NOAA could make sound decisions on what this 
mix should look like, a study was performed by Mitretek Systems in 2000 
that assessed the coats of hydrographic data collection by contract, 
ship lease, and NOAA ships. As part of that study, Mitretek estimated 
the cost to reactivate and operate the NOAA ship FAIRWEATHER, and the 
cost to lease a vessel capable of surveying an annual amount equal to 
FAIRWEATHER. The FAIRWEATHER operating cost estimate was based on the 
vessel's sister ship RAINIER. Mitretek's estimated cost to activate 
FAIRWEATHER was $16.7 million and to operate the vessel annually was 
$6.6 million. Mitretek's estimated annual lease cost based on input 
from the private sector was $8.8 million. Assuming a 15-year operating 
life for FAIRWEATHER after reactivation and spreading the reactivation 
cost across the 15 years, the annual FAIRWEATHER operating cost would 
be $7.7 million versus the annual lease cost of $8.8 million. However, 
more recent information from vessel lease contractors indicates the 
cost of leasing a vessel outfitted and staffed with mission equipment, 
which can operate 24-hours/day, may now be over $10.0 million per year. 
NOAA continues to explore the costs and other factors associated with 
vessel leases with respect to utilizing this type of asset in reducing 
the survey backlog.

                   LABORATORY IN LAFAYETTE, LOUISIANA

    Mr. Vitter. Okay. Final set of questions real quickly. In 
Lafayette, Louisiana, there is a beautiful new state-of-the-art 
facility which is housed by some government agencies which has 
a significant percentage empty. It was built and designed for 
NOAA, and it is completely empty, including state-of-the-art 
labs. This is probably the most gorgeous government building I 
have ever seen. It is beautiful. It is sitting there. It 
includes very expensive and modern labs, and it is just empty.
    I know there is a whole history behind this disagreement 
between the former Chairman of this subcommittee and NOAA, but 
it seems to me whatever that history is, this being empty, the 
NOAA portion of it sitting there unused, empty, these labs not 
being used is a shame. What is your perspective on this, and 
what do we need to do to put the government asset to use and 
not have it sitting there idle?
    Mr. Gudes. Without going through how NOAA got the 
building--and at this point you are right, we have this, we 
paid for--in fact, it costs us probably close to $200,000 a 
year for space we cannot use. I thought it was slightly higher 
than that. About $200,000 we are paying for a space we cannot 
use.
    Mr. Vitter. That is unrelated or different from the capital 
cost that is sunk into the building.
    Mr. Gudes. Yes. Lafayette, Louisiana, is actually an 
attractive area for a lot of the work we have done in terms of 
estuaries, in terms of hypoxia. The university is there. We 
actually had one employee who decided to homestead. He got set 
up with this building, and then, when informed of what--we 
would not do anything until the committee said we could, and we 
almost had to forcibly remove the employee from the building.
    We are paying for the building. We have some people working 
in the Lafayette building that are working in the space, but we 
need approval for Congress to do that.
    Mr. Vitter. So from your perspective, we are ready to do 
that and put the asset to use.
    Mr. Gudes. Yes, that is correct.
    Mr. Vitter. Did you have--that is all I have, Mr. Chairman.
    Mr. Wolf. Mr. Cramer.

                      WEATHER FORECASTING OFFICES

    Mr. Cramer. Mr. Gudes, thank you for your presence here 
before the subcommittee today. I will bring up an issue that 
you are very familiar with, a National Weather Service-related 
issue. I represent one of the most weather-obsessed areas in 
the country, and I am aware of myuse of words there. We are 
weather-obsessed because it is a matter of survival. There are all kind 
of tragic weather occurrences that we experience, but the ravages of a 
tornado are something to contend with, to say the least.
    I am using your Website information, excellent Website. But 
from 1950 to 1994, Alabama ranked fourth among all States with 
275 fatalities due to tornadoes, and we rank third among all 
States with 4,483 injuries. Since that date of 1950, we have 
endured $600 million in damage from tornadoes. Every family has 
a tornado story there.
    So when you all rolled out your modernization plan several 
years ago, I was on the Science Committee then. I tracked that 
and listened and watched and dialogued with your folks very 
carefully because it seemed to me that my community there in 
north Alabama wasn't going to be protected, and the best of 
plans has flaws, and I think we all need to be flexible enough 
to realize that this is not just a budget issue, this is a 
public safety issue.
    But my experience with the National Weather Service, to say 
the least, was maybe at best a miserable experience. It was 
like pulling teeth to get information out of the Weather 
Service to get them to do some give and take with me about my 
community. Finally, we wonder about the issue of my area being 
included in the modernization. It wouldn't be just my 
congressional district, it was bigger than that.
    Tom Bevill, who was in the Congress then, had the district 
below me, and Zack Wamp in Tennessee had that southeastern 
corner of Tennessee. We went to the National Research Council, 
and they concluded more or less that we were one of the most 
vulnerable areas in the State.
    I want to thank you for the information that you have given 
to my office recently regarding where I thought we were many 
months ago, that that kind of went on hold some, because there 
was an obvious transmission from one administration to another, 
but we have been through these cycles over and over again where 
we have been on hold. But back in 1994, when I went over to 
Goshen, Alabama, where Alabamans were struck in church Sunday 
morning--20 people killed in church, no sirens in the 
community, a remote area that is attempted to be covered from a 
49-county site out of Birmingham, Alabama. In our opinion that 
is just too big an area for one office to cover. We are 
pleading for some kind of office that would give us some link 
to that office so that we can have a protection plan that our 
EMAs could feel comfortable with, that the community could feel 
comfortable with.
    So I make that long-winded opening statement to complain to 
a certain extent about the give and take, but I hope we can 
make the progress that we have been making lately.
    Mr. Gudes. I hope so, too, Congressman, and I will say 
growing up in southern California, I have never seen a tornado. 
Even at NOAA in our labs I have not seen one. I know a lot of 
the severe weather you have. Sally Chadbourne back there on the 
staff is from near Birmingham and has talked to me many times 
about the impact, and every spring we have an outbreak of these 
terrible storms, more in the United States than in any other 
country in the world, and it is definitely--there is no doubt 
that one isn't overtaken by a story of the impact they have on 
lives and safety. That is why a little earlier I talked about 
all the work I am doing in research and trying to get the 
research services.
    We have some real heroes, the people like Jeff Kempo. He 
has made his life goal improving technology and working on the 
fundamental science of storms and tornado.
    Mr. Cramer. Thank you for those comments, but now let me 
ask you how many full-blown WFOs does the Weather Service 
currently operate and maintain?
    Mr. Gudes. One hundred twenty-one.
    Mr. Cramer. How many Weather Services offices have you 
closed?
    Mr. Gudes. One hundred fifty-four.
    Mr. Cramer. What is the cost to the National Weather 
Service of establishing a WFO, excluding the cost of providing 
the radar?
    Mr. Gudes. Five million dollars. You need to do 24 by 7, 
obviously, and a full complement.
    Mr. Cramer. That is excluding the radar.
    Mr. Gudes. Five million dollars is the facility, and about 
$2\1/2\ million in personnel to operate 20 to 25 full-time 
equivalents to maintain 24 by 7.
    Mr. Cramer. Did you state in there--you may have--what's 
the annual cost of operating one?
    Mr. Gudes. About 2\1/2\ million.
    Mr. Cramer. Mr. Chairman, that is all I have.
    Mr. Wolf. Thank you.
    I will recognize Mr. Latham for just a second, but if I 
represented Mr. Cramer's area, I would feel I would be intense 
like he is. I think he is right. I think you ought to work out 
something to do it.
    I remember seeing with regard to that church. And I also 
remember Senator Shelby tried to do something on 
transportation. And I think it was line item veto. They are 
vetoes with the government. I think it makes a lot of sense. If 
that were my area, I would feel that way.
    Mr. Gudes. Mr. Chairman, I have followed up with Mr. 
Cramer's staff, and we were working on an idea that might meet 
the Congressman's needs.
    Mr. Wolf. Good. I hope the committee could back up whatever 
you need to do.
    Mr. Cramer. Thank you.
    Mr. Latham. I am a late arrival, so I would yield to Ms. 
Roybal-Allard.
    I would yield to you, as I came late. Go ahead.
    Mr. Wolf. Thank you, Mr. Latham.
    Mr. Serrano. You are a great American.
    Mr. Latham. I want something.
    Mr. Serrano. In that case, you are a typical American.

                        EDUCATIONAL PARTNERSHIPS

    Ms. Roybal-Allard. I would like to go back to the topic 
that Mr. Serrano was asking some questions on thereafter, the 
Educational Partnership Program with Minority-Serving 
Institutions. I was very pleased that you have included it in 
this year's budget. My question has to do more with what your 
plans are for next year. You indicated at the Department 
hearing that one-half of the fiscal year 2002 funding is going 
to new partnerships, and the other half is going to sustaining 
existing partnerships. How do you decide which institutions 
merit a continuation?
    Mr. Gudes. What I said was probably wrong. What--within the 
program there is about $10 million of the $15 million which we 
said we are going to create four Centers of Excellence as I 
mentioned before, remote sensing, because we do a lot of work 
on satellites, fisheries and science, environmental science, 
and atmospheric science. And actually we have taken our line 
offices in NOAA to make sure this has paid off and makes a 
difference and said, fisheries and marine science, you will own 
that partnership, NESDIS, you will own the satellite 
partnership. That is $10 million, about roughly $2.5 million 
roughly per Center of Excellence.
    What I meant to say during the Secretary's hearing, I 
thought you were asking about a number of new centers. The 2002 
budget would be the second year of funding for those centers. 
The centers may be consortiums. You may have a situation where 
California State University partners with University of Miami, 
I am just making one up, but that would be a consortium. Really 
what our budget does is continues those four Centers of 
Excellence.
    And the idea I talked before about my idea of getting my 
students to come and graduate at NOAA, the other idea is to 
have the capacity. We have a number of very good relationships 
at NOAA with premiere atmospheric and oceanic and marine 
science institutions like Woods Hole, the University of 
Washington. The University of Oklahoma I talked about before. 
We do a lot of work whenever we are allowed to do it on a 
competitive basis, and those institutions almost always win. 
And some schools never get a chance to get those contracts for 
research. So of the idea here is to really do a focused effort 
to build that capacity so those same institutions can compete 
with these other schools.
    The Environmental Entrepreneurship Program, which is $3.3 
million of the $15 million, which I tried to answer in the 
Secretary's hearing, that would be a continual set of 
competitively awarded projects from a number of minority-
serving institutions around the country to look at real-world 
projects in terms of environment that NOAA works on. It might 
be some sensor development. It might be restoration. It could 
be any number of things. But the idea would be that program 
would continue to every year be given.
    And the last part of the program is scholarships. It is 
bringing people into the agency and bringing them into NOAA and 
having them work as part of their education.
    Ms. Roybal-Allard. In terms of these institutions that 
apply for competitive grant and they don't win, is there 
something and some kind of a program that helps them to 
understand how they can improve in terms of responding to the 
request for proposals?
    Mr. Gudes. Yeah. I think we would be debriefing any of the 
institutions. Congresswoman, this program has been asking 
something that was a concept that we put together at NOAA maybe 
3 years ago, and something we pushed originally at actually a 
lower funding level, and we got a lot of support at the last 
funding level to come forward with it, with the request, and we 
are still way below NASA and some of the other agencies in what 
they spend.
    We fund other activities at other institutions. We do do 
annual career conferences. We just did a conference with 
fisheries taking the lead at Jackson State, for example, in 
Mississippi. And in terms of contracting, we are always looking 
for ways we can get more of our contracts to be able to go to 
disadvantaged firms, minority firms. We are doing better in all 
of those areas, but especially in the work force area, and in 
terms of the capacity-building area, we really haven't stepped 
up to where we like to be at NOAA.
    Louisa Koch is here, who is our deputy head of research. 
She took a big part of our daily routine to make sure it 
happened and really got it through there in record time. It is 
really a credit to her and her team.

                             GLOBE Program

    Ms. Roybal-Allard. I will ask you about another program 
that I actually just found out about 2 years ago at the NOAA 
hearing. That was your Globe Program. And could you describe a 
little bit in more detail about the importance of this program 
and--you know, just because I know it has been very, very 
positive. I have gotten positive feedback from the areas in my 
district where you have it, and I think it is important to 
highlight it a little bit at this hearing.
    Mr. Gudes. I talked a little bit more about the education 
and the industry. I think educational outreachtakes place in a 
lot of places in NOAA, and Globe is one of the really great programs 
that we have where we have stepped out and really tried to do something 
to really educate kids around this country and actually around the 
world, because Globe is a national program. It is not just Globe we 
work with. NASA, I think EPA, and NSF are part of it, and some other 
agencies. It is about putting together an infrastructure and training 
teachers to go back to their schools so they can be global schools. It 
is my hope we will be moving into oceanic measurements as well.
    I agree with you as I go around the country it is amazing 
how many school districts this has made a big impact and how 
many States have come forward, and we are Globe States. I think 
Alabama, I think Texas want to do an agreement on that. It 
often ties back to institutions. When I was at Jackson State 
and Mississippi, Jackson State is sort of a centerpiece for 
Mississippi, and there are now--I don't know the exact number 
of countries around the world, but there are Globe schools, and 
it seems Tom Pyke, who I don't think is here today, is always 
announcing another agreement with Globe.
    Ms. Roybal-Allard. Do you do any tracking of students that 
participate in the Globe Program to see if, in fact, they move 
into those areas?
    [The information follows:]

                 Tracking of Students in Globe Program

    NOAA does not yet track students to see if they move into 
scientific areas. This is attributed to the large number of GLOBE 
students that are currently in the 3rd through 6th grades, and the 
relatively young age of the GLOBE program itself, which has only been 
in operation since April 1995. GLOBE does plan to track students who go 
on to major in science programs, and will make its first effort to do 
so in the 2001-2002 school year.

    Mr. Gudes. I don't know. I will have to get back to you. I 
am sure Tom Pyke knows that. I will say when I talk about 
education, it is about trying to get our laboratories, our 
weather forecast offices to really make an impact, and all 
across this country we have employees who have made a special 
effort to get involved in education. Next week we have a group 
of students coming back here from a weather forecast office in 
Cheyenne, Wyoming, where the meteorologist is starting women in 
science. There in the Cheyenne community he has set up role 
models for women in junior high school, because they found a 
lot of women will leave the sciences. They will leave them. And 
they tutor and teach and bring in different role models from 
NASA and other agencies. We are bringing Bill and other 
students back here to showcase the other people and their best 
practices because that is what I want our people to be doing.
    Admiral Fields is here, and she has a program where they 
bring people out and talk about the research going on the 
ships. I meant what I said at the beginning, part of our 
mission is to create the meterologists, scientists, 
oceanographers and ocean explorers of the future.

                        NATIONAL GEODETIC SURVEY

    Ms. Roybal-Allard. One of the things that caught my 
interest is the work that you conduct at California Space 
Center. I understand it is the state of the art in increasing 
value to public safety and preservation to valuable resources 
and to include business activity productivity. Could you 
describe NOAA's activities in this area in more detail and tell 
us the importance of these activities?
    Mr. Gudes. Our National Geodetic Survey is part of the 
National Ocean Service. It is one of those areas we don't talk 
so much about until we do something like the GPS industry fair. 
And we hear the GPS industry talk about how NOAA helped create 
the private GPS industry. It is all about specific vertical and 
horizontal measurements. This is about brass plaques that are 
the reference points for all surveying and all measurements 
within the country. We now use GPS and satellite technologies 
to do that. NOAA is charged with the basic grid and maintaining 
that grid for the vertical and horizontal network across the 
country.
    It is almost like when this committee talks about NIST in 
terms of basic infrastructure for measurements for industry. 
NGS does really fulfill that function, and it is really quite a 
super part of the agency.
    Ms. Roybal-Allard. What is its value in terms of public 
health, for example?
    Ms. Davidson. In some cases this information helps you 
better understand issues relating to, for instance, subsidence 
in its relationship to water resources and other environmental 
concerns. And as you know, the coastline of, well, much of 
California, but particularly the coastline of California is a 
fairly dynamic environment in terms of waterlevels both in the 
rivers and in the ocean.

                              ARGO PROGRAM

    Ms. Roybal-Allard. Okay. Another program is the ARGO 
program, which, if I understand correctly, is a system of 
floats which perform real-time observations of temperature, 
salinity and temperatures of the ocean in order to predict and 
forecast. Can you describe that for me, the program and its 
activities?
    Mr. Gudes. Sure. For a number of years it is pretty obvious 
to a lot of people that the oceans really drive the world 
climate system; that to really understand what is going on you 
need to understand the oceans. It turns out whether you are 
looking at weather from above or you are looking at the oceans 
that we have a lack of observations compared to land. That is 
obvious to a lot of people. We have very few ships at sea. So 
the idea of ARGO, which is a global oceanographic observation 
system, it is really similar to the weather balloons where we 
launch them, and they tell us what the temperatures are, what 
the wind pressures are. The same is with ARGO. We get those 
floats and deploy them at set reference points. They will go 
down to 2,000 meters and drift for 10 days. As they come up, 
they measure temperatures and salinity. As they come up, they 
transmit that information to a satellite, and then they go down 
autonomously.
    We are working on a grid of about 3,000 of these floats 
worldwide. This is international. We are working with the 
Japanese, and the French, and the Australians to provide a grid 
across worldwide oceans. Our budget provides--this year the one 
we are looking at gets us up to about 275 ARGO floats 
procurement per year. It has funds in there for the data 
management and use, collecting the data and standarization. 
Some of these are actually built with Scripps from California. 
The Scripps Institute of Oceanography is very heavily involved.
    The only other thing I would mention besides helping unlock 
some of the secrets of climate and what is going on with the 
oceans, we are doing business differently with this program 
that it goes to the National Ocean Partnership Program, which I 
co-chair with the Navy. And we put that money forward to NOPP 
as a NOAA contribution, and then it goes out to NOPP to 
institutions like Scripps, for example. It is exciting, and I 
think we will be unlocking understanding of what is going on in 
the global system. It gets to information about the oceans and 
the atmosphere in a way that we have been better able to know 
than before.
    Ms. Roybal-Allard. That is all.
    Mr. Wolf. Mr. Latham.
    Mr. Latham. Thank you, Mr. Chairman, and welcome.
    You are talking about GPS and the rural development. I 
don't know if you are aware in agriculture like combines today 
they have the GPS, and you monitor the yield as you harvest and 
it maps it out afterwards so you can go back next year and put 
that on the computer. And you can conserve fertiziler and 
herbicides and pesticides on the field. So it just puts on 
exactly what you need. It is incredible all the uses that are 
there today.
    Mr. Gudes. They have GPS watches now.
    Mr. Latham. When they are made in America, we will get 
them.

                            TORNADO WARNINGS

    Mr. Latham. Following up with Mr. Cramer's points, the key 
performance measures for the agency are tornado warning lead-in 
time and accuracy, and apparently in 1997, the lead-in time was 
approximately 10 minutes, and now lead-in times are currently 
estimated for next year to be at 13 minutes. Can you explain 
what is happening? Are we going backward?
    Mr. Gudes. We are about 10\1/2\ now. We are about 6 minutes 
in 1993. This is actually one of the benefits of the deployment 
of the NEXRAD Doppler system.
    You said we are supposed to clear 16 minutes in what time 
frame?
    Mr. Latham. Thirteen next year.
    Mr. Gudes. Those are stretch goals. We are trying to 
continue to elongate the warnings that--one of the realities of 
the Weather Service, I think, is that the Weather Service has 
been willing to step up under the GPRA sort of management and 
say, we will move to performance measures, and we will move to 
hit those measures. It is really quite gutsy in a way because 
as you know in Iowa better than anybody the weather changes, 
and we can't control that. We can't control how many of the 
tornadoes are F zeros. The larger tornadoes you usually get 
better lead time on whether they are F zeros or not. We do not 
develop the weather, and I think in the last year we had a few 
weather outbreaks that were a bit different, and we did measure 
it. But we are very much trying to get that improvement up.
    I mentioned, Congressman Latham, before you came in, that 
we are looking at newer polarization down at the National 
Severe Storm Labs in Norman, our test bed, with a storm 
prediction center, to do a better job, and we think we will get 
better lead times on that. Jeff Kimpel who heads that lab is 
working with the Navy on phased-array radar with a total 
different technology where he believes could give us a 30 
minute lead time. The Weather Service talks about the Weather 
Service in the 15, 20 years out, but it is partly about radar 
technology and about being able to detect the signature of the 
tornado.
    Mr. Latham. That is the good news. But the bad news is you 
will never see anything about the weather map up there 30 
minutes before. It is what you need, obviously, but sometimes 
the--God bless them, but they want to show off their new 
technology more than they want to----
    Mr. Gudes. It is also about flash flood, because they know 
about accuracy, we are about 41 minutes of flash flood 
accuracy. We have a number of variables various what our holes 
are. We would like to do better than we have been. It is an 
issue of technology, it is an issue of weather we get, it is an 
issue of the people.
    Mr. Latham. I usually ask for a weather forecast for the 
Midwest farming situation at this time. I don't know if anybody 
knows that, does anybody know what La Nina and El Nino will do 
this year?
    Mr. Gudes. We are in a neutral situation in the Pacific. We 
don't know what the outlook for this summer is for the Midwest. 
I am told it is normal.
    Mr. Latham. Last year they said drought, and we got lots of 
rain.
    There is a request for $900,000 for the weather climate 
connection. Is there anything for El Nino or La Nina for that?
    Mr. Gudes. We are really trying to look at doing global 
warming and trying to see what sort of impacts there are. There 
is something that will put forward proposals for how it will 
change severe weather. Most of that is in the category of 
maybe. We do not know. We have more research to submit upon 
that.

                    NPOESS-POLAR ORBITING SATELLITES

    Mr. Latham. Is part of this, what you were referring to 
earlier, that $83 million--I don't know if the chairman covered 
that--$83 million for the national polar orbiting environmental 
satellite system? Tell me if you have gone over this.
    Mr. Gudes. I have not. I mentioned polar satellites. I 
really talked about first generation. I would like to talk 
about that.
    Mr. Latham. If you would, please.
    Mr. Gudes. The polar orbiting satellites that we have do 
several functions. They orbit about 500 miles above the Earth. 
They do atmospheric soundings, they give us the temperature and 
humidity profiles that go into the global models that you hear 
about. Over oceans they are, in many parts of the world, the 
only database that we have. Those satellites do imaging of 
soil, crops, ice, sea surface temperatures. They do search and 
rescue. And they do some climate measurements and ozone 
measurements, for example.
    We and the Air Force have operated separate systems for 40 
years in this country, same type satellites but, different 
sensors. We emphasize soundings, they emphasize imaging. NPOESS 
is putting those two systems together into one satellite system 
to do all of those with improved sensors. The first launch date 
would be late 2008, 2009. For NOAA it is critically important, 
in that we have only three existing generation polar satellites 
to get us to that end post, period.
    As we talked about earlier today, Congressman Serrano's 
questions, sometimes satellites fail on launch and sometimes 
they fail early on orbit. And that would mean we would be in a 
position of wondering whether or not we have coverage. It is 
critically important that we move forward. It does converge the 
weather service, NOAA. It does convergence with the Air Force, 
DOD, into one satellite system for military commanders and for 
the civil side. I can tell you that based on earlier 
projections it is about $1 billion of savings from what people 
were talking about in the mid-nineties.
    But it definitely would have three orbits instead of four. 
Right now we have four orbits in this country, two satellites 
up at any time. We have a morning orbit and an afternoon orbit. 
We operate a DMSP program for the Air Force in early morning. 
So it would only be three. It would be three orbits. So it is 
fewer platforms. The platforms are designed to last longer. We 
are trying to get 7 years of life out of those satellites.
    In terms of what the polar satellites do, they are not the 
ones you see on television, but they are critically important.
    Mr. Latham. Just as a follow-up, how much coordination and 
how much money is coming from the DOD, then?
    Mr. Gudes. It is a 50/50 program. The same money is coming 
out of the Air Force research/development budget. So we are 
matched in what is in the President's budget.
    One other partner I should have mentioned is NASA. NASA is 
coming forward with the end-post preparatory program, where 
they are going to fly three of our sensors about 4 years or so 
before NPOESS flies the first time. So we will not be flying 
instruments for the first time. In fact, I wastestifying in a 
hearing in Alaska with Administrator Golden, and we talked in Alaska 
about the importance of NPOESS to Alaska and NASA's participation in 
that program. So it is DOD, 50/50.
    Mr. Latham. Thank you, Mr. Chairman.
    Mr. Wolf. We have a vote. We will stay until there is about 
a minute left, and then we have two votes and then we will be 
back. You can see how much interest there is. We have a lot of 
questions that have not been covered. But whatever is not 
covered will be submitted for the record.

                        coastal zone management

    You are requesting $75.4 million for costal zone management 
programs, which is an increase of $12.2 million above the 
fiscal year 2001 level. Since 1999, the committee has provided 
$169 million for the coastal grants. Are there quantifiable 
results for the program that you can share with us?
    Mr. Gudes. I think more and more of the American public are 
moving to the coastal areas. And, in fact, when the coastal 
zone program was originally designed in 1972, I don't think 
people even thought there would be this much development.
    Mr. Wolf. 1972.
    Mr. Gudes. 1972.
    Mr. Wolf. I was at the Department of Interior. We were 
involved in a major battle. There was a vote on the floor, and 
I looked at Mr. Latham and just remembered that it was offered 
by Congressman Kyl from Iowa, one of the best Congressman I 
think ever to serve in Congress. I later worked with Mr. Kyl. 
He offered an amendment on the floor putting the coastal zone 
management program into the Department of Interior. And that 
was, in fact, as I was up in the gallery at that time. I was 
working for Secretary Morton and it later shifted back over to 
NOAA.
    Mr. Gudes. It did in 1972. When it was finally authorized, 
it was authorized in NOAA.
    Mr. Wolf. It was originally put on the floor to put in the 
Department of Interior. It was a close vote. Mr. Kyl--it was an 
eloquent debate and carried it and then it later slipped out. 
That is interesting. You just saw Mr. Latham in front of Mr. 
Kyl who is now living in Arizona. He was the Congressman from 
Ottumwa. Is that near you?
    Mr. Latham. That is more southeast. I am more northwest.
    Mr. Wolf. He's a good man.
    Mr. Latham. He's from Iowa.
    Mr. Wolf. Yes. Go ahead.
    Mr. Gudes. So I think there are a number of examples where 
in fact the program has made a significant difference in 
maintaining the quality and pristine nature of the coastal 
areas as well as allowing for development to continue.
    I am aware of some States--in California, in South 
Carolina--where I have seen the work of the Coastal Council. It 
is a partnership between the States and NOAA. We pay about half 
the program. These are coastal managers from States. We are 
supporting them in terms of State laws to try to maintain 
cleaner water and State laws that try to maintain development 
in a way that maintains the environment.
    For example, in the case of South Carolina, it has to do 
with regulating how far docks can go out into marsh areas and 
to try to save pristine marsh. In the case of South Carolina, I 
have seen efforts that try to build roads so that polluted run-
off don't get out into the estuaries. It is different in each 
State. It is targeted by State in terms of State run the 
program.
    Mr. Wolf. Are the staff--because of the importance of it, 
the staff mentioned at the committee last year--I was not on 
the committee--directed NOAA to have a report. And I think the 
report was scheduled to come up in March. Where is the report--
because of the importance of the program.
    Ms. Davidson. We will have to ascertain the exact desk, 
but----
    Mr. Wolf. March 15.
    Ms. Davidson. Yes, sir. And we actually did give notice to 
the committee the report was going to be late. We had submitted 
the report to the process. It was required within the agency 
and within the executive office program. So I am not sure if it 
is on a desk in Commerce or if it is on a desk in OMB, but we 
will ascertain the exact location.
    Mr. Wolf. If you could maybe call the committee, the staff, 
this afternoon and let us----
    Mr. Gudes. Mr. Chairman, one other point, going back to 
your point before. It is harder to develop performance measures 
in a way in this area than we have, for example, in the Weather 
Service it is something we are actually working on in NOAA, 
because it is important to do a better job in terms of 
performance measures to see what the committee is getting back 
in return.
    Mr. Wolf. I think the sooner we can get the report back, 
the sooner we can mark this up.
    Ms. Davidson. Yes, sir.

                             nmfs increases

    Mr. Wolf. In 1999, the National Marine Fisheries Service 
was funded at $382 million. The President's request is for $600 
million in 2002. That is an increase of 57 percent. Why such an 
increase, and where is the money going?
    Mr. Gudes. There are a number of areas in fisheries where 
that investment has gone.
    Mr. Wolf. Where will it go? This one here, though, it goes 
from $382 in 1999 to $600 million. And Mr. Vitter's point and 
Mr. Cramer's point with regard to death, with regard to the 
hurricanes and weather
    Mr. Gudes. It is one of our very important missions. It 
goes way back to 1870 in terms of management of fisheries and 
protected species at NOAA. We are responsible for whales, sea 
turtles, not just fish. The answer to the question is it has 
gone into different areas. Northwest salmon is a major growth 
area. Northwest salmon are in crisis. It is an issue of habitat 
and management. We had a $90 million habitat program for 
Pacific salmon that we did not have back in the time frame that 
you quoted. It is about fisheries management and society----
    Mr. Wolf. The staff says that may not be in the number, 
that program.
    Mr. Gudes. Pacific coastal salmon is not in the number; $34 
million of salmon, internal for consultations, for example, 
that was not in that number; $8.5 million for red snappers. For 
example, Mr. Miller was talking about, at the last hearing with 
the Secretary, about----
    Mr. Wolf. Maybe you can elaborate on that for the record. 
Because as we look at such an increase--and not only the 
program is problematic but also where, what areas, like through 
Mississippi or to Virginia or wherever it is, so we can sort it 
out.
    Mr. Gudes. We can do that. It is an area of NOAA that has 
not been adequately funded. As a matter of fact, as we were 
looking at a year ago at having RIFs and all sorts of negative 
impacts, we put something together called the Kammer study. You 
may have heard of it. And we really try to do a real thorough 
review of the fisheries budget. It really does fall in the area 
of science and the surveys. I will get back to you.
    [The information follows:]

         FY 2002 Request for National Marine Fisheries Service

    The National Marine Fisheries Service's (NMFS) budget has grown 
recently in recognition of the fact that the organization has been 
underfunded to meet its basic statutory requirements under the 
Magnuson-Stevens Fishery Conservation and Management Act, Endangered 
Species, and Marine Mammal Protection Acts. In addition, to address 
fish issues, funding of cooperative research with the industry has also 
become a priority. Critical areas of need recognized by the 
Administration, the Congress, and fisheries constituent groups include 
stock assessments, management of fish stocks, protected species 
management and research, and enforcement programs. All of these 
activities are legislatively mandated under primarily the Magnuson-
Stevens Act, Marine Mammal Protection Act, and Endangered Species Act.
    The recent Kammer Report reviewed NMFS' mandates and requirements 
and recommended significant additional resources in these areas as 
well. NOAA's research and data collection programs in Alaska, the Gulf 
of Mexico, and elsewhere have grown to keep pace with management needs 
of the Nation's valuable commercial and recreational marine fisheries. 
Cooperative research programs (those conducted by the fishing industry 
itself) have also grown recently and total $16 million in the FY 2002 
request. These programs not only yield information needed for 
management, but also improve NOAA's relationship with the industry. 
Similarly, our management programs have grown to fully implement the 
requirements of the Sustainable Fisheries Act.
    Funding for specific marine mammals and endangered species has also 
increased significantly. Additional funding has been provided for 
research and management requirements associated with determining the 
cause of the decline in Steller sea lion populations and potential 
recovery actions in the Nation's largest fishery, the North Pacific 
groundfish fishery. Finally, several new programs have developed. For 
example, funding has been needed to address threats to coral reef and 
restore habitats around the country through community-based restoration 
programs. Taken all together, this funding is needed to meet NOAA's 
mandates. The FY 2002 request continues this progress.

                             telecommuting

    Mr. Wolf. Okay. We are down to 4 minutes. How are you doing 
on teleworking? We offered language last year, which is law, 
that mandates 25 percent this year, 50 percent, 75 percent and 
100 percent.
    Mr. Gudes. We followed your lead, Mr. Chairman. One of the 
things we did was got some work stations in telecommuting areas 
around the Washington, D.C. Area.
    Mr. Wolf. That is really like black and white television. 
If you were to go out and buy a television, you will probably 
not buy a black and white set. They are okay. But I think you 
can have a tremendous impact on traffic, morale, retention, 
recruitment, energy, the environment, and the language really 
talks about the ability to work at home 1 day a week.
    Mr. Gudes. To answer your question, I am the type of 
individual, probably, that wouldn't work telecommuting.
    Mr. Wolf. Why not, though?
    Mr. Gudes. If I stayed home, I would probably not be able 
to go up and work on my computer. I would probably sit there or 
mow the lawn or watch HBO or something.
    Mr. Wolf. Do you want that to be in the record?
    Mr. Gudes. It already is.
    Mr. Wolf. But the studies show--I would like if you could 
take a look at the AT&T testimony--studies show people working 
at home 1 day a week are actually as productive or in some 
respects even more productive. There are less telephone calls 
and problems and people talking to you at the water cooler and 
different things like that. And also for many people who have 
families, the opportunity to have greater control of their own 
life. So from a productivity standpoint, at AT&T, 55 percent of 
its people, mid-level management, are teleworking.
    Mr. Gudes. Mr. Chairman, I totally agree with you. And, in 
fact, I was going to continue, that I sat down with my head of 
human resources, who is a big advocate of telecommuting, and we 
talked about how this is part of remaining competitive in the 
workplace in the future within the government and within the 
private sector; and, in fact, that to be able to offer 
telecommuting is critically important.
    Jolene Lauria Sullens is on my right. She lives in 
Solomons, she drives about 70 miles a day to work. We have 
talked about it. We are aggressively trying to implement it.
    Mr. Wolf. I think you should. The law is--it is justnot a 
recommendation, it is 25 percent by the end of this year. And I think 
it is good for your employees. It is good for morale, it is good for 
productivity, it is good for the environment. It takes a tremendous 
amount of automobiles off the road. Friday traffic is lighter than any 
other day. It is down by 3\1/2\ to 4 percent. For every 3 years that we 
get out of their cars, we reduce traffic congestion by 10. We can make 
a major impact to quality of life, to environment, energy. And so--if 
you really, really could.
    Mr. Serrano. They are waiting for us.

                              GHOST SHIPS

    Mr. Wolf. There are the ghost ships down on the James 
River. Do you know about the ghost ships? How are we going to 
resolve this issue? Maybe you can answer this when we come 
back. Is there not a danger to the Chesapeake Bay and the James 
River if a major weather system came up the James River and 
sank some of those ships? And I just think the problem is 
festering.
    It is not in my congressional district, but obviously I 
care deeply about the James River and the Chesapeake Bay and 
what can we do to deal with this issue from a professional 
point of view, but also are there dangers--and you can begin 
with that, and then I will recognize Mr. Serrano--are there 
dangers to the marine fisheries in that region, the oysters, 
the crabs, and different things like that if a major weather 
system came up, because some of those ships are almost sinking 
now. And if you could just kind of help me with it.
    Mr. Gudes. This is the MARAD National Defense Reserve Force 
that you are talking about?
    Mr. Wolf. Yes. We will recess and be back in about 7 
minutes.
    Mr. Gudes. Thank you, Mr. Chairman.
    [Recess.]
    Mr. Wolf. The meeting will come to order.
    We will recognize Mr. Kennedy. But do you have any thoughts 
about how we can resolve the ghost ship problem and 
recommendation for the committee?
    But also, is there a real potential problem if a weather 
system were to come up into that region with regard to sinking? 
Several of those ships I think have sunk.
    Could you comment, or if anybody on your staff, it just may 
not be your area of expertise.
    Mr. Gudes. Mr. Chairman, I know a little bit about the 
National Defense Reserve Fleet.
    Mr. Wolf. And they are adding a lot more ships this year, 
as I understand.
    Mr. Gudes. I would believe that when those are mothballed, 
this is the NDRF, I would believe that they will have fuel and 
oil taken out and be mothballed.
    Mr. Wolf. In terms of asbestos?
    Mr. Gudes. In terms of asbestos, that is an issue. There 
was an initiative on this committee, some 5 years or 6 years 
ago actually, to give the authority to MARAD to sell those 
ships overseas. There were receipts that used to come in 
running the RF to MRDF and to MARAD, and because of asbestos it 
was stopped. EPA wouldn't let those ships in.
    Mr. Wolf. Right. The problem--really have to get your 
experts involved in this--The problem is that the private 
sector--the oil companies, I will just say--they sell their 
ships abroad. I think they actually sell them to India and 
places like that.
    I am not looking to transfer a problem to someplace that is 
going to create havoc there, but I wonder--and to do it 
domestically, the cost is millions and millions of dollars and 
we don't have the money to do it.
    And I am just wondering if would it be a good idea, for 
instance, just to set up a company, maybe in Honduras where the 
unemployment rate is now in the area of poverty, maybe in the 
50 percent range, operate it with American technology as to how 
you do it. I had a daughter in the mission project in Honduras 
for 2 years. Life in Honduras is very difficult. So we 
developed a program down there to help the Honduras economy 
whereby they would have jobs that could be done in an 
appropriate way.
    But there seems to be a dichotomy. The private companies, 
American companies are selling the ships to India and nobody is 
saying anything. And if it is bad, I don't want to put that 
there; but these ships are not. And they are rusting and they 
are decaying. I saw an ABC news piece where you walk through it 
and it just sinks.
    So how do we deal with this issue rather than just 
notdealing with it?
    Mr. Gudes. I think NOAA can be a part of the solution. We 
have expertise certainly----
    Mr. Wolf. Is there a weather problem, if a weather system 
came up there, sinking those ships?
    Mr. Gudes. Conceivably it could happen if there were a 
hurricane that came up the James River, which has happened 
before, but I can't say that I know that would be a constant 
problem. And severe weather can always cause problems.
    Mr. Wolf. But these ships are in just fragile conditions if 
a hurricane came up and hit them. I am not trying to put you in 
a mess. This may not be your area. But I would like you to get 
some people to come up to think this through.
    One, my sense tells me that if a hurricane did come up, we 
could devastate the James River and we could have a major 
impact on the Chesapeake Bay.
    Secondly, could we set up a private operation funded by the 
United States Government to pick a country in Latin America or 
someplace that needed the help, and make sure that the 
environmental standards and the worker standards and the 
protections were there, whereby we could be of some benefit to 
them, some benefit to the environment, and some benefit in 
contrast to the companies that are just selling these ships 
off, and get them money for them?
    Does that make any sense to you?
    Mr. Gudes. Yes, sir. Quick answer. I think probably MARAD 
or another agency would be the right one to be--the right one.
    Mr. Wolf. You guys are fisheries though, and I am concerned 
about it from an environmental point of view. They have not 
done a lot. They have a study that is done, it is not even up. 
They are just kind of looking at it. There is no money in the 
budget, and they are just adding to the ghostly fleet.
    Mr. Gudes. Off the top of my head, the Office of Response 
and Restoration in the National Ocean Service should be able to 
do some trajectory work if there is a spill from one of these 
ships where----
    Mr. Wolf. Or maybe 7 of them or maybe there are 120, does 
anyone know, 120-some now there, and I understand they are 
ready to add 20 more.
    Mr. Gudes. Right.
    Mr. Wolf. I am coming straight up and you are hitting--and 
although you showed me your charts here with regard to 
Honduras--I mean, I remember one year Belize got hit, and 
Honduras got hit at another time, and people didn't even 
realize that. And that is my concern from--I do represent the 
State of Virginia. I want to see what we can do, because I have 
a question in here that I am going to submit for the record, 
asking you about the crabs in the Chesapeake Bay and some of 
the other, the oysters and restoration, they are also 
interrelated there. And then to use your expertise as to what 
we can do to maybe set up a private company that the Congress 
would pay for, public-private partnership maybe with a country 
somewhere around the world that didn't impact on their 
environment, gave them a fair wage, and so we have a win-win 
situation.
    Mr. Gudes. Certainly, we would like to be helpful. We will 
get back to you with a group of parts of NOAA that actually 
could be involved--Office of Response and Restoration, Office 
of Marine Aviation Operations come to mind right away. The 
Weather Service, obviously. And we will try to see what we can 
do to be helpful.
    Mr. Wolf. Good. I would appreciate that.
    [The information follows:]


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Wolf. Mr. Kennedy.

                         NOAA SEA GRANT PROGRAM

    Mr. Kennedy. Thank you, Mr. Chairman. Welcome. I just want 
to go through the Sea Grant program, which I know you brought 
up briefly before I arrived, and I wanted to see what plans you 
have to enhance the Sea Grant college programs around the 
country. And, of course, we have one in my State of Rhode 
Island.
    Mr. Gudes. Sea Grant is one of those outstanding 
partnerships that we have in NOAA about doing work just not in 
our own laboratories but outside. That is both through the 
research as well as the extension program.
    The University of Rhode Island and the Rhode Island program 
is one of our best and, really, was the laboratory in the ocean 
state in terms of all the things that one can do.
    In terms of the Sea Grant direct request, the good news is 
this is the second year, the first time the President's budget 
fully funds the Sea Grant program. Actually, I think a little 
bit of inflation last year, so we are fully funding the 
different institutions.
    In terms of other programs that we are doing and how they 
would fund into Sea Grant, because we actually do some 
competitive research in Sea Grant, I would have to get back to 
you on that and----
    Mr. Kennedy. How about the National Oceanographic 
Partnership program? How does that fit in with what is going on 
with the----
    Mr. Gudes. In Sea Grant?
    Mr. Kennedy. With the Sea Grant.
    Mr. Gudes. I don't think it really does. It doesn't 
really--it hasn't yet related back to Sea Grant. Our main 
contribution in NOPP has been the ARGO program, which I talked 
about, Congressman, before you came, which is ocean buoys. But 
most of our Sea Grant program is directly with those 
institutions, 20-plus institutions around the country.

                   NATIONAL OCEANOGRAPHIC PARTNERSHIP

    Mr. Kennedy. Can you speak a little bit about the National 
Oceanographic Partnership program?
    Mr. Gudes. Sure. It is a partnership of really all the 
Federal agencies that are involved in oceanography and the 
oceans. It was set up by law, I think the Armed Services bill 
if I am not mistaken. It is cochaired--it is chaired by the 
Secretary of the Navy currently and cochaired by NOAA. And it 
includes NSF, it includes Interior, it includes a number of 
other entities.
    And largely it has been doing a lot of research, again we 
put ARGO through it, ocean sciences group, working with kids. 
We put I think about $150,000 or $170,000 and a lot of 
volunteers at NOAA in terms of this program.
    It has an ocean research panel, Dr. Marcia McNutt is 
slated--from Monterey Bay Research Institutes--is slated to 
head that up. And it actually is a very good model fortrying to 
get the agency cooperation in the oceans.
    Mr. Kennedy. So it might be useful for the upcoming 
Presidential Commission on Ocean Policy?
    Mr. Gudes. I think that the upcoming Presidential 
Commission on Ocean Policy would want to hear from NOPP and 
would probably want to take a look at how NOPP has worked as a 
mechanism. But--and I know from the panel that I cochaired, 
that the NOPP staff, the people from the Consortium for 
Oceanographic Research and Education want to brief the 
Presidential panel. The panel doesn't yet exist. It is one 
example to try to get the agency in the panel.
    Mr. Kennedy. What are some of the main challenges that you 
see with respect to that at NOAA?
    Mr. Gudes. It has to be started. We are pretty excited 
about the policy commission and the passage of the act by 
Congress last year, and this is the first fundamental look at 
the oceans from a Federal policy standpoint and from a rules 
admission standpoint and private sector/public sector that 
really has happened in 30-some odd years.
    So NOAA has always been on the side of thinking this is a 
really great idea to get this going. The panel was supposed to 
start, I think, April 20. It hasn't yet happened. We are 
waiting. I actually make a phone call a day to find out where 
we are. The President is set to appoint 16 members of the 
commission.
    As you probably know, there are already appropriations 
assigned, I think, of some $4\1/2\ million or so, independent 
appropriations for the panel. We have a little bit of money in 
NOAA, I think about $800,000 from a previous year's 
appropriations to support the panel.
    And there are any number of areas in the oceans that in 
fact the commission will want to look at for ocean exploration 
which we worked on, and a number of the other issues we talked 
about today. And we are--we are real excited about it. We just 
want to get it started.

                         FISH STOCK ASSESSMENT

    Mr. Kennedy. Good. Well, we obviously have a great deal to 
do in terms of the stocks of our fish stocks, and the fact that 
the status of more than 70 percent of our fish managed under 
the Magnuson-Stevens Act are unknown due to a lack of basic 
funding and research dollars.
    Can you describe how important it is to properly assess the 
stocks and what role it plays?
    Mr. Gudes. Yes, sir. The science, the data, how many 
critters are there and how fast they are growing and the 
competition is kind of the core of being able to manage marine 
living resources in this country, and it is one of NOAA's key 
missions. When we talked about that increase that the Chairman 
talked about before, there was a lot that went into the data 
surveys and science to be able to support our fishery 
management councils around the country like the New England 
council, to provide that independent data that says here is 
what we see. Spiney dogfish, a big issue in New England about a 
year ago, a significant issue, as long as we know what was 
happening with that stock. We did it through our independent 
service council. So the science and the surveys are critical.
    We are up to about 50 percent of surveys by private 
contractors. But it is absolutely essential that we have that 
data. And as you point out, there are far too many species, 
West Coast groundfish, where we don't have good science data 
because we haven't been able to spend everything that we can to 
do that survey.

                       ENVIRONMENTAL DATA SHARING

    Mr. Kennedy. I just encourage to you look into this recent 
NASA project that we did up in Rhode Island with Brown where 
they did, you know, photo satellite imaging of the Narragansett 
Bay and surrounding area, and they did the photostat and it 
showed all the different colors, and a very pretty picture.
    But it also helped us identify some concurrent other 
observations that are happening, to decline in fish stock, 
decline in the phytoplankton and so forth.
    And it is a terrific tool, and I imagine it could be very 
useful to you in terms of the near littoral area, the coastal 
area, maybe not in the deep water but certainly in the coastal 
area.
    Mr. Gudes. We have Coast Watch, or our polar satellite, and 
I talked about that before, one of those imaging systems we 
used. We also use ocean color imaging. I talked about the next 
generation actually. That is one of the capabilities that we 
will have with alkalometry and scotometry, it will be a better 
oceanographic satellite.
    Clearly oceanography from space, I think we call it ocean 
remote sensing in our budget, is something that our people have 
made a big impact with.
    The other thing I would say, this overall ecosystem 
approach, the Glowback project and really taking a look at all 
the factors that will affect fisheries. I know in the case of 
sea lions in Alaska, that is a lot of the research we are 
doing, and they are trying to look at the overall regime shift 
that is taking place in the whole ecosytem approach.
    Mr. Kennedy. What are we doing to share that around the 
world so we have Chesapeake Bay, Narragansett Bay, Prudhoe 
Bay--they may all share some characteristics and others may 
have differences, but how do we share the experiences of each, 
once we input all of that?
    Mr. Gudes. One of the traits of NOAA--it is not just NOAA, 
it is a Federal agency--is that our researchers are putting 
their data out for others to see all the time, providing 
papers. We publish a lot in the Science magazine. We put stuff 
on the Net. That is part of the way of doing business. We are 
an open agency, and so we are always trying to get the results 
of the work we are doing.
    In the case of satellites, it is almost real-time to get 
that information out. I was talking about our Web site earlier 
today, and clicking on our Web site we have the image of the 
day. If you go to NOAA satellites, you can see a number of 
other things to track, the Gulf streams, several times a day. 
It is what we are about.
    Mr. Kennedy. I am wondering whether people can use the 
satellite data imaging to sue polluters. For example, we have 
an energy plant that is producing a lot of heat in Narragansett 
Bay, correlated very well with the decline in fish stock.
    They haven't put--the energy plant hasn't put the cooling 
for the cooling of effluent that comes out of the plant, and 
all the fish stocks have gone away. They said that they 
haven't, that it is normal heat from the sun and the rest. But 
now with this satellite imaging, it is beyond a shadow of a 
doubt that it is their plant.
    So I am wondering like with all this new evidence that you 
come up with, you know, do you find are you getting any 
feedback that it is being used in a fight for cleaner 
environment?
    Mr. Gudes. People are always using data in terms of 
environmental assessment. In terms of the specific use, Iknow 
we put the data out, I don't know all the uses that people take the 
data. We are working to get the data out freely and rapidly to users.
    We do--I should have mentioned we have a new, based on 
congressional support, we have a new coastal data center 
actually based in St. Louis, Mississippi, which is going to be 
archiving and making a lot of information available to users 
there.
    I think there was one other point that you made.
    Mr. Kennedy. That would be good, Mr. Chairman, as far as 
people knowing what is going on out there, to get the--that 
data out there in a commercial friendly way. I mean, you know, 
ARPA and DARPA, and they have all of these acronyms for how 
defense technology gets out into the private sector.
    NOAA, it seems to me, has a lot of technology in commercial 
applications for it. I am wondering who designed--I mean, I 
guess the private sector will wind up coming up with 
applications, but it seems to me very----
    Mr. Gudes. Right. We get it out to the researchers and the 
private sector, and I actually thought as we were talking about 
it, one thing--we should probably be getting a briefing for 
you--is Atlantic Oceanic Meteorology Lab in Key Biscayne, 
Florida. One of our research labs actually has done a lot of 
work with acoustics and actually found a lot of significance in 
figuring out where the pollution is going through acoustics. It 
is not just about remote sensor. So we will work on that, too.

                       NON-POINT SOURCE POLLUTION

    Mr. Kennedy. On the nonpoint source pollution, given that 
is the primary source of pollution for many of these coastal 
States now, what is your agency doing to accomplish the 
objective of finding ways to--like through the nonsource 
pollution control programs, how are you adequately supporting 
those programs?
    Mr. Gudes. Nonpoint, as you point out, is a significant 
issue. It is a significant issue in estuaries like the 
Chesapeake Bay where a majority of the problem is, in fact, as 
we do more building, as we have more asphalt, it has more 
runoff. It actually affects a lot of things, including 
flooding, that the Weather Service deals with, and we have more 
paving and more development.
    But it is an issue that we work on all the time. We work 
with all those States when we talk about coastal State 
management. We now have a program that we didn't until last 
year, thanks to the congressional support, and it provides a 
project on States that have approved nonpoint programs. I think 
it was $10 million in our budget. It was annualized in our 
budget of $10 million.
    We actually moved at NOAA in planning--being able to 
upstage the planning to help some implementation.
    Mr. Kennedy. That would be very welcome in our State 
because we are approved per our plan, and we really look 
forward to getting some support to implement that plan.
    Mr. Gudes. It is a big issue.
    Mr. Kennedy. It is a big project. We just inaugurated $500 
million nonpoint source pollution overflow system in 
Providence, Mr. Chairman.
    There are going to be tunnels throughout the city, but it 
is going to be a huge public works project, but it is going to 
save the Bay, all the shutdowns of the Bay because of the 
combined sewer overflow. But we will need some help with that.

                   MARINE FISHERIES LICENSING SYSTEM

    Finally let me say, on the national marine fisheries, we 
are looking at some major reforms in the State marine fisheries 
licensing system. That is what I hear. It is very complicated, 
but I just look forward to staying in touch with your----
    Mr. Gudes. In the State system.
    Mr. Kennedy. In the State system, but look forward to 
staying in touch with your agency.
    Mr. Gudes. We just got all the marine directors from all 
the marine fish States together probably for the first time, 
and I know Bill Hogarth, who is here, worked pretty closely 
with Rhode Island. I will be happy to do that.
    Mr. Kennedy. I would like to get a briefing because I know 
it is coming about and, you know, the need for reform is there. 
We need to bring some transparency for the fisherman.
    Mr. Wolf. Mr. Serrano.

                           offshore drilling

    Mr. Serrano. Thank you, Mr. Chairman. The whole issue of 
offshore drilling is back in the news, and there are people on 
every side of the issue. What is NOAA's role, if any, in the 
whole issue of offshore drilling, either advice or the actual 
participation?
    Mr. Gudes. Well, we have roles in a few areas, but one of 
them that is probably the most direct is on the Coastal Zone 
Management Act. I talked before about--when the Chairman asked 
about the actual funding and partnership with the States--one 
of the other things is that States get in turn for--in part for 
being coastal managers is also the consistency provision, which 
says that Federal actions are being consistent with State laws, 
State policy.
    And that has at times come in, in terms of offshore 
drilling and whether or not issues are consistent or not. And 
it is often, as I learned, a very legalistic process, where I 
wouldn't dare talk about any specific cases of that.
    Now let me ask Margaret Davidson, beyond consistency, there 
is oil and gas drilling.
    Ms. Davidson. Of course the Coastal Impact Assistance 
program which was appropriated by this committee last year 
actually directs financial resources to seven States that are 
impacted by current oil and gas production activities, and we 
are in the process right now of working that out as a mechanism 
to get the response to the States.
    And we engage very regularly with the Minerals Management 
Service and provide consultation for both the Federal level and 
engage the State partners when you are looking at both 
exploration proposals--well, investigative proposals as well as 
exploration proposals.
    Mr. Serrano. I am more interested in future situations. I 
mean, we always hear on the news how the President or the 
administration says this is something we should do. You hear 
the environmentalists on the other side saying maybe not. And 
we really don't know what role different agencies play.
    Do you have under the law, the ability to stand up and say, 
one, this is not a good idea; or two, if you do it, it has to 
be done this way; or, three, you can't do it here?
    Mr. Gudes. A number of Federal agencies are required to 
come back, for example, on our Endangered Species Act, saying 
are there any impacts. That is part of what takes place in the 
same issue that I talked about. Bill mentioned that we have to 
permit.
    Mr. Hogarth. We have to permit in the fish habitat. That is 
in the critical habitat. We comment through the Federal system. 
We have had some of them in the pipelines, for example, and we 
have had two of them that the council got involved with, 
Fisheries Management Council, and asked them to relocate them, 
and we are responding; a lot of spawning bays for some bottom 
fish. And so we are all involved with the process. We do it 
with the Federal Management Council as a group.
    Mr. Serrano. This is just--I mean, you comment, but you 
have no mandate in law to make it more difficult if it requires 
to be difficult? I am not asking NOAA now to get into a fight 
with the Administration, but does NOAA have the ability to look 
at something and suggest this is not a good idea or certainly 
not a good idea here?
    Mr. Gudes. I think on a number of areas our role is to give 
the best scientific advice that we can. And this is in any 
number of areas. It includes--we haven't talked about climate 
global change today, but our role is to do the best science we 
can.
    Mr. Serrano. That is my next question. It really is.
    Mr. Gudes. I was hoping we would move off of oil and gas.
    Mr. Serrano. You did start answering that, what role you 
play in that.
    Mr. Gudes. Actually, our job is to do the best--we do it 
through observations, and we do it through predictions, but it 
is to give the best science we can. Our job isn't necessarily 
to say this is the right or wrong thing to do. It is to say 
here is what professionally--this is what the impacts will be.
    And that is true of the endangered species. I mentioned 
before protected species. We are responsible for sea turtles 
and whales and sea lions and other protected species, as well 
as the fisheries stock.
    And I think there was one other program I think we forgot--
do we still have that insurance program for the Gulf fishermen 
getting entangled in gas? We actually run an insurance program. 
I should have mentioned that before.
    Mr. Serrano. I get your point. The point is you do an 
analysis, but your analysis could be totally overlooked by the 
administration. So my question is--not you, I am not asking you 
guys to do it--but do your analyses, your work, fall under laws 
that--for instance, I could say, you see, "NOAA just said," and 
therefore under this law----
    Mr. Gudes. Yes, sir. Well, that is consistent. But I would 
say one of the things we haven't talked about is that one of 
the things I learned in 3 years at NOAA is almost all of these 
issues end up in the courts. And whatever we do in the Fishery 
Service, it seems like whoever did it then is suing us and we 
are in court.
    So I can assure you that I would believe that on any of the 
issues you are talking about, in fact, there would be a source 
of litigation either between the oil and gas company or the 
State or the environmental agency, and that is oftenwhat 
happens. And in that case, what NOAA says professionally often becomes 
part of the record and part of the case of what proper procedure is 
followed.
    In the case of consistency, which is what I started off by 
talking about, and it is a legal issue and I think Margaret 
Davidson pointed out it is not really an oil and gas project, 
but it is an issue whether or not it is consistent with the 
State's policy and program, the coastal zone management, to 
have that oil and gas drilling.
    And as often happens, depending on how that ruling goes 
out--and this isn't only NOAA--if NOAA says yes it does impact 
consistency, or no it doesn't, often who didn't get what they 
wanted to have happen in that exchange often then goes to 
court. NOAA often gets brought to court.
    We have a general counsel's office that is pretty busy in 
this area in fisheries because we are often involved in 
litigation.
    Mr. Serrano. Let me ask you a mechanical question here to 
define your agency functions. If the administration was to ask 
for your comments on drilling somewhere, are those public 
comments or private comments?
    Mr. Gudes. I don't know the answer to that.
    Ms. Davidson. It would probably depend upon the manner in 
which we were asked. I mean, if we were commenting on action--
for instance, if the Minerals Management Service of the 
Department of Interior--then our comments would be a matter of 
public record. If we were behind closed doors and if we are 
talking about a work product----
    Mr. Serrano. That would never happen. That would never 
happen. Okay. And so I already started to ask, can you then 
tell me basically, the same situation, how that applies to a 
climate change and the information that the government needs or 
policymakers need?
    Mr. Gudes. NOAA is not the only agency, but it is one of 
the key agencies that is involved with climate.
    Mr. Serrano. You can tell me how your budget speaks to that 
subject.
    Mr. Gudes. There is about a $16 million increase defined 
for services this year. We spent about $240 million in total on 
climate, and climate is the kind of thing that--probably you 
are thinking about asking me about the global long-term climate 
signatures that say the overall earth-warming, what are the 
regional impacts? It is also seasonal.
    Congressman Latham asked a question earlier today, what is 
going to be in Iowa this summer. That is climate, too. It is 
long-term measurements that say it is going to be drought, 
wetter, warmer; that is about climate. When I say $240 million-
some, that is observation forecast.
    In terms of global climate or long-term climate where we 
have had a lot of interest, obviously there has been a lot of 
press on the issue, our job is to do these long-term 
observations. It is not exactly the most glamorous things 
sometimes, or the most exciting, but we have a National Climate 
Data Center in Asheville, North Carolina under NOAA's 
satellites. That is what they do.
    They are the repository for data. They can tell you for any 
place in the world what the temperatures were, what the 
rainfall was, going back. They come forward and tell in 1998, 
hey, it was the warmest year on record and here is how we know 
it.
    We run observation systems around the world. Those buoys I 
talked about before, those are running all the time, getting 
those measurements of the ocean, our satellites measurements. 
It is a lot of measurements. It is research. We do a lot of 
research on climate global change programs. We have a lot of 
partners at universities. Columbia has been one of the 
institutions that I know that the committee has a lot of 
interest in that we fund.
    It is about climate forecasting and taking those 
predictions and making it better. In terms of global climate, 
we have worked with the Intergovernmental Panel on Climate 
Change, IPCC, Dr. Dan Albritton, who some of the staff here 
know, who is the head of our lab in Boulder, who is one of the 
preeminent scientists in the world on climates, aerosols, 
specifics on what is happening, and he is one of the authors of 
one of those papers for IPCC.
    Our job at NOAA, as we see it, is to call it the way we see 
the changes. There is general agreement by scientists that the 
Earth's--the Earth is warming, that it is athogenic, though 
again that it is human caused, about six-tenths of a degree 
Celsius over the last century or so, that would be Fahrenheit. 
That is a global measurement.
    I was just in Alaska with Senator Stevens, and in the 
Arctic those signatures are greater. It is more like 2 degrees 
Celsius, more like 3.6 degrees on average, in Alaska, warming. 
Over the last rain year, about 4 percent rain year.
    We publish in Science magazine, our scientists do. We have 
a number of excellent scientists--Steve Levitis from our 
National Ocean Data Center, who has done a paper on the top 
10,000 feet of the ocean that have gone about a tenth of a 
degree Fahrenheit in the last 50 years. That may not sound like 
a whole lot, but that is a lot of energy worldwide.
    Our job is to do the observing system. Our job is to do the 
forecasting. We run models at the Geophysical Fluid Dynamics 
Lab in Princeton. It is one of the premier modeling labs in 
this country on climate. We do our projections.
    We can try to answer questions about carbon sinks. If you 
were able to remove this much carbon, what would likely happen? 
But our job is to provide that information for the Secretary, 
for decisionmakers, and that is the way wedo see our role. And 
we call it straight, but we don't change what our scientists have to 
say.
    We call it as they see their research and their 
observations, and that is I think what the public should expect 
from NOAA and what we need to maintain.
    Mr. Serrano. Mr. Chairman, I have a few more questions I 
will submit for the record. I just have 1\1/2\ questions I 
would like to ask.

                     IMPACT OF FUEL COST INCREASES

    The half question is, the Department of Defense has a 
problem, as you may know, with fuel, and there is a 
supplemental request from the Administration, primarily for the 
Department of Defense, with additional funds for other agencies 
to address emergency needs in this area.
    You folks have aircraft and ships. Are you experiencing the 
same situation, and how does your budget speak to it?
    Mr. Gudes. Our costs have increased. Actually, this 
committee came forward last year and gave us some assistance in 
that regard, because we were quite--we were looking at a crisis 
about a year ago. I have not done a computation. I should ask 
Admiral Fields if we have what the latest fuel prices are 
versus the old fuel prices. Obviously, if we are off, that 
means less flying hours, less steaming hours. As I said, this 
committee really came forward and helped us out of a very tough 
situation last year on flying hours.
    These are hurricane flying hours. These are winter storms. 
And I think you ended up giving us about $800,000 more for 
flying hours last year, which covered a lot of that problem. 
But, Admiral, do you know what the costs--the latest cost 
differentials are?
    Admiral Fields. With the money that we got last year for 
both flying hours and for ships, we were able to maintain the 
same sea days and same flight hours that we had in previous 
years. And we expect to be able to maintain that unless fuel 
prices continue to go up, and right now I don't have a guess at 
whether that is going to happen or not.
    Mr. Gudes. Congressman, you are right. Just like the Coast 
Guard, the Transportation Department, or the Department of 
Defense, we have the same sort of issues of running a fleet, a 
fleet of aircraft, just we are smaller. We have 15 ships. We 
have 3 major aircraft, 10 smaller aircraft.
    Mr. Serrano. Those agencies have a supplemental request and 
you don't.
    Mr. Gudes. Yes.
    Admiral Fields. That is true.
    Mr. Serrano. We are trying to help you here.
    Mr. Gudes. I am sure the Office of Management and Budget, 
which is here, probably----
    Mr. Serrano. Did you ask anybody for it?
    Mr. Gudes. I don't believe we submitted a request, 
Congressman. I don't believe we did, and I have not heard that 
at this point that it has significantly impacted on operations.
    I will assure you that when our fleet, when our uniformed 
service--if they were to tell me we have a problem during 
hurricane surveillance flights, I would be up here--maybe I 
wouldn't be up here, but I would be wanting to come back.
    Mr. Serrano. My understanding was that the extra money was 
to expand hours, not to keep them flat, so you might already be 
feeling that.
    Mr. Gudes. We got some of that. We had some of that take 
place. It also covers some of the fuel costs. My concern at 
NOAA since I have been there has been in general that we do not 
use our assets, our P3s or GIV aircraft, for example, nearly 
enough as we could. I think that the Department of Defense 
funds a lot more flying hours than we do.
    But our flying hours are tougher, flying through a 
hurricane, you know. We use the same maintenance schedule the 
Navy does, but we fly a lot fewer hours, but flying through 
hurricanes is pretty tough on airplanes.
    So we are bringing them in every 4 years or so for a full 
standard level maintenance and repair at the Naval Air Depot at 
Jacksonville to rebuild those airplanes.
    But they provide an invaluable service for the country. 
That is really how we get those exact measurements inside those 
storms about what the pressure is and what the wind speeds are. 
And it is our Corps officers who actually are willing, based 
out of Tampa, to do this and fly through these hurricanes.
    But the answer to your first question, we do not have a 
supplemental request up for fuel. And I don't know the answer 
to your question. At the current price rates, we are short.

                  NON-UNIVERSITY EDUCATIONAL PROGRAMS

    Mr. Serrano. Okay. My last question refers to elementary 
school and middle or junior high school, high school. What is 
your involvement in programs, educational programs, not at the 
university level?
    Mr. Gudes. Yeah. I was trying to answer a little bit of 
that earlier. I think that we do have programs like GLOBE that 
I talked about which is a formal program, Teacher at Sea, which 
is a formal NOAA program, but I often find that the programs 
that are the most special and have the biggest impacts are the 
ones where fisheries labs, fishery regions, weather forecast 
offices, OAR laboratories around the country, where they 
partner and made a special effort to really get involved with a 
local school district.
    And as I travel around the country I usually try to 
personally visit the activities that are involved, and I found 
that it is going on all over the country.
    I should also mention one other thing, and we are 
alsolooking for best practices, which I mentioned before, of trying to 
highlight the places where this happened, give people awards, really 
try to emphasize that is what we want as an agency.
    One other thing: Bring a Child to Work Day. We had 500--we 
had employees bring 500 kids to Silver Spring, and we had 
Topper Shott, who is a local meteorologist, and we did a little 
science fair talking about the importance of science, and each 
of our line offices did workshops with these kids. So National 
Ocean Service talks about geometric measurements, those things 
that we talked about; and the fishery talked about protected 
species, and we did that through, I think, 4 or 5 hours. And 
then we actually had all of the chief managers of NOAA, 
including my friends over here, serve ice cream to the kids 
afterwards.
    But I will tell you, in terms of the impact, I had parents 
come back and tell me about how their kids came back and said 
now they are going to study math and science because they went 
to NOAA and they want to work at NOAA someday. And we told them 
over and over again, you have to study math and science.
    It is a big part of what we do, it is a big part of what we 
believe in. And I can't tell you enough about what kind of 
impact NOAA Corps has made and others have made in terms of 
that effort.
    Mr. Serrano. Let me just thank you for your testimony and 
once again pledge my support. I must say in closing that I was 
slightly taken aback by your comments regarding the Chairman's 
telecommuter program, the ability to telecommute. You could 
have said you were going to sign up right away.
    Let me tell you that I do it on Mondays and Fridays when I 
am not in the district, or heading towards the district, or 
coming back early, and we have no votes. I am able to take my 
son to school and get out my laptop, and my laptop becomes my 
work station right.
    And I do everything I do in the office except meet with 
people, which is fine, and I have caught up on all the Magnum 
PI reruns.
    Mr. Wolf. He wants a desktop, for the record.
    Mr. Gudes. Mr. Chairman, I just want to clarify. I am a big 
believer in telecommuting, and we are aggressively moving, 
because we do believe it is for the right reasons, for 
everything you said, as well as being a competitive agency. I 
was just saying for me personally it wouldn't work that well.
    Mr. Serrano. Let me in closing thank you for one of your 
NOAA employees who is on detail to our committee, Christine 
Maloy----
    Mr. Gudes. She is great.
    Mr. Serrano [continuing]. Who is going to be part of our 
telecommuting program also. Thank you so much.
    Mr. Gudes. Thank you for letting her serve on the staff. We 
really appreciate it.
    Mr. Wolf. We have a lot of other questions, but I actually 
have a 1 p.m. meeting scheduled. It has been a good hearing, 
but we have questions about Chesapeake Bay crab, Chesapeake Bay 
Right Whale recovery and, the national polar satellite program. 
And also we were going to go into depth on your lawsuits as to 
what could be done. I understand you have a lot of them 
pending.
    Who also litigates them for you? Do you have your own 
lawyers or do you use your Department?
    Mr. Gudes. The actual litigation is done by the Justice 
Department. The Department of Commerce, the Secretary and the 
NOAA lawyers, do a lot of the work getting ready for 
litigation.
    Mr. Wolf. A little bit about the fish inspection program 
and how does it work and the separations between Food and Drug 
Administration and NOAA.
    But we will submit these for the record in light of the 
time. And we appreciate your testimony, and with that the 
hearing will be adjourned.
    Mr. Gudes. Thank you, Mr. Chairman. We appreciate it.


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                           W I T N E S S E S

                              ----------                              
                                                                   Page
Evans, Hon. D.L..................................................     1
Gudes, S.B.......................................................   167
Zoellick, R.B....................................................    89


                               I N D E X

                              ----------                              

                         DEPARTMENT OF COMMERCE
                         Secretary of Commerce

                                                                   Page
Opening Remarks..................................................     1
DOC Budget Growth................................................     2
Highlights of DOC Budget.........................................     3
Critical Infrastructure Protection...............................     3
Economic Data....................................................     4
Manufacturing Extension Partnership Program......................     4
NIST Core Mission................................................     4
Global Climate Change............................................     5
Spectrum Allocation..............................................     5
Statement of Secretary Evans.....................................     7
American Community Survey........................................    13
2010 Census......................................................    14
Estimated Cost of 2010 Census....................................    14
ACE..............................................................    15
NOAA Research....................................................    15
International Trade Administration/MFN...........................    16
Export Enforcement...............................................    18
Trade Failures...................................................    22
Export of Torture Devices........................................    22
Digital Divide...................................................    24
Technology Opportunities Program.................................25, 45
Census and Puerto Rico...........................................    27
Metropolitan Statistical Area....................................    28
Free Trade.......................................................    35
Trade Sanctions..................................................    36
Trade Adjustment Assistance......................................    37
International Trade Data Network.................................    32
NOAA Programs....................................................    38
Small Business Administration/Minority Business Development......    38
Native American Programs.........................................    39
Small Businesses.................................................    40
Minority Business Development Agency.............................    41
Nautical Charting................................................    42
Mapping and Charting.............................................    42
Appointment of NOAA Administrator................................    44
Public Telecommunications Facilities Funding.....................    47
Educational Partnership Program..................................    48
Latin American E-Business Fellowship Program.....................    49
Steel Dumping....................................................    50
Critical Infrastructure Assurance Office.........................    51
Economic Development Administration..............................    53
Spectrum Availability............................................    54
Advanced Technology Program......................................    55
Conflict Diamonds................................................    57
Patent and Trademark Funding.....................................    57
Minority Serving Institutions....................................    59
Island of Vieques................................................    61
Census...........................................................    62
NOAA Responsiveness..............................................    63
Census Suitland Facility.........................................    64
Unfilled ITA Trade Positions.....................................    65
U.S. Embassies Role with American Business.......................    66
Trade Compliance Initiative......................................    66
Creating Jobs in Prisons.........................................    67
Trade with Africa................................................    68
Telecommuting....................................................    70
Communist Chinese Military Companies.............................    72
Questions Submitted by Congressman Wolf..........................    73
Questions Submitted by Congressman Serrano.......................    81
United States Trade Representative:
    Agricultural Trade Subsidies.................................   118
    China Relations..............................................   110
    Conflict Diamonds............................................   151
    Democracy and Trade..........................................   152
    Department of Labor--Trade Adjustment Assistance to Workers..   133
    Digital Divide...............................................   116
    Fast Track Authority.........................................   156
    Free Trade of the Americas...................................   128
    Health and Safety Laws.......................................   128
    HIV AIDS and Intellectual Property...........................   111
    Intellectual Property........................................   144
    International Labor Programs.................................   137
    Manufacturing Job Tony Blankley, Washington Post Article.....   148
    Mexican Truck Safety.........................................   113
    Moving USTR from CJS Jurisdiction............................   115
    North America Free Trade Agreement--NAFTA....................   130
    Opening Remarks of Ambassador Zoellick.......................    93
    Questions for the Record--Jose Serrano.......................   158
    Steel Industry Crisis........................................   122
    Stuffed Molasses.............................................   121
    Sugar Trade..................................................   120
    Telework.....................................................   146
    Textiles.....................................................   128
    Trade Policies and State Sovereignty.........................   127
    Trade with Cuba..............................................   117
    USTR Physical Security.......................................   143
    Written Statement of Ambassador Zoellick.....................    96
    WTO Transparency.............................................   149
    Questions for the Record--Ralph Regula.......................
    Questions for the Record--David Obey.........................
    Questions for the Record--Dan Miller.........................
    Questions for the Record--Harold Rogers......................   164
National Oceanic and Atmospheric Administration:
    ARGO Program.................................................   267
    Coastal Zone Management......................................   270
    Educational Partnerships.....................................   260
    Environmental Data Sharing...................................   276
    Estuary Restoration Act......................................   285
    Fish Stock Assessment........................................   275
    Globe Program................................................   261
    Impact of Fuel Cost Increases................................   282
    International Climate and Weather Datasharing................   238
    International Participation Relating to Mozambique...........   241
    Island of Vieques............................................   248
    Laboratory in Lafayette, Louisiana...........................   257
    Life Cycle of NOAA Satellites................................   245
    Long-Term Vessel Chartering..................................   254
    Marine Fisheries Licensing System............................   278
    Marine Navigation Services...................................   251
    Marine Protected Areas.....................................250, 286
    Minority Serving Institutions................................   247
    National Defense Reserve Force...............................   270
    National Geodetic Survey.....................................   262
    National Marine Fisheries Service (NMFS)...................267, 287
    National Oceanographic Partnership...........................   274
    NERRS--Number and Acreage....................................   286
    New NOAA Administrator.......................................   235
    NOAA Sea Grant Program.......................................   274
    NOAA Mapping and Aerocharting................................   237
    NOAA Website.................................................   246
    Non-point Source Pollution...................................   277
    Non-university Educational Programs..........................   283
    NPOESS--Polar Orbiting Satellites............................   265
    Offshore Drilling............................................   278
    Opening Remarks of Acting Under Secretary and Administrator 
      Scott B. Gudes.............................................   177
    Satellites...................................................   238
    Study of Ghost Ships in James River, Virginia................   273
    Telecommuting................................................   269
    Tornado Warnings.............................................   264
    Weather Forecasting Offices..................................   258
    Written Statement of Scott B. Gudes..........................   180
    Seafood Consumption..........................................   289
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