[Congressional Record Volume 140, Number 23 (Monday, March 7, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]
[Congressional Record: March 7, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]
NATIONAL COMPETITIVENESS ACT
The Senate continued with the consideration of the bill.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BAUCUS. Mr. President, I rise with some reluctance to oppose the
proposed amendment which I believe may be offered by the Senator from
Missouri, [Mr. Danforth].
I am in this position reluctantly because I have the highest regard
for Senator Danforth as a leader on international trade issues. He and
I have worked together, for example, to extend Super 301, win passage
of NAFTA, win passage of the 1988 trade act, and win trade negotiating
authority for at least two administrations.
I have the deepest admiration for his contributions to trade policy,
and I see him as one of my most valued friends and allies in the
Senate.
I also share his concerns regarding the impact of the new GATT
agreement on our countervailing duty or antisubsidy laws. The fact is
that our trade laws, that is, our American trade laws, counterveiling,
antidumping, section 301, are critical to American trade policy.
These laws have taken us further in the direction of a genuinely
free-trade provision than any other trade agreements. They are the
backbone of American trade policy, and they cannot be traded away from
any trade agreement. But I think with all respect to my friend from
Missouri, before the Senate puts itself on record on this issue, we
should at least listen and listen carefully to the administration's
case. The administration has a number of arguments to make with regard
to provisions of the Uruguay round which this resolution addresses. The
administration's first chance to explain its views is a hearing being
held by the Senate Finance Committee this Wednesday at 10 o'clock.
Further, I am disturbed by this resolution's suggestion that the GATT
agreement be renegotiated. Frankly, it is just not realistic to
renegotiate the Uruguay round. It took almost 7 years of painful
negotiations between 107 nations to conclude the round. We are not
about to go back and ask each of those 107 countries to come back and
renegotiate another agreement. We cannot at this point go back to the
table and demand specific changes without endangering the entire
agreement, which on balance will mean tens of billions of dollars in
additional economic growth and hundreds of thousands of new jobs.
I might also point out that other countries have plenty of provisions
they also dislike, and they will certainly demand changes in exchange
for the changes we want. The entire agreement could easily break down.
Senator Danforth may be entirely right about the subsidy issue. It
may be right for the Senate to take the step. But we should not do it
hastily, and we should consider what is at stake. The round is
projected to raise world economic production by $270 billion a year,
and it could raise American GDP by $65 billion a year. It means
hundreds of thousands or even millions of high-paying export jobs for
the United States.
This round has been a consensus goal of American trade policy since
the mid-1980's. It is the product of three administrations. It is the
perfect example of bipartisan cooperation. And, before we destroy it,
let us at least look carefully and think hard. We should weigh the pros
and cons of hearings and have this debate, but we should get the facts
on the table first.
I have been working with Senator Danforth's staff on provisions for
the Uruguay round implementing language that I think will protect our
trade laws. It may be that we could address the problem he raises in
implementing legislation. We may be able to create a special procedure
that balances foreign research subsidization with counter subsidies on
our side. We may be able to limit the scope of this provision and
provide a congressional check on its extension beyond the 5 years
agreed to in the GATT.
None of these options is perfect, but I am confident that we can
protect section 301, and even strengthen it, in the implementing
language. I am confident that we can protect our dumping laws, and even
strengthen them, in the implementing language. I want to work with
Senator Danforth to see if we can do the same to protect our
countervailing duty law.
At this point, I consider a vote on this resolution unwise. It would
be premature. I urge my friend from Missouri to work with us to find
other solutions. If in the end we cannot find them, I may well be back
working with him on this resolution at a future date, but not here
today. For today is too early for this resolution, and I urge my friend
to withdraw it--at least not offer it--and, if he does offer it, to
then withdraw it so the administration can make its case and work with
the rest of us in this Senate to find a solution that does not threaten
this round.
I urge my friend, therefore, not to call up this amendment.
Mr. President, I yield the floor.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. HOLLINGS. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BUMPERS. Mr. President, I am pleased to rise in support of S. 4,
the National Competitiveness Act of 1994. Among other things, S. 4
creates a Civilian Technology Investment Company [CTIC] program aimed
at fostering the development of critical technologies by small- and
medium-sized businesses. In large part, the program is modelled after
the Small Business Administration's [SBA's] successful Small Business
Investment Company [SBIC] program which has helped develop such
business superstars as Federal Express, Cray Research, and Apple
Computer.
When S. 4 was reported by the Senate Committee on Commerce, Science,
and Transportation, I could not have supported the CTIC program it
contained. That version would have established a duplicative
bureaucracy within the Department of Commerce to administer the
program, which in many respects was identical to SBA's SBIC program.
Further, that version would have permitted the CTIC program to use
nonparticipating equity securities, thus permitting investment
companies to circumvent sharing some of their federally sponsored
profit with the Federal Government.
Happily, today S. 4 contains an improved CTIC program, thanks to the
dedicated efforts of my colleagues, Chairman Hollings and Senator
Rockefeller, their staffs, the Department of Commerce, the Small
Business Administration, and my staff on the Senate Small Business
Committee. Like the SBIC program, the CTIC program will license
investment companies which will provide financing through debt
securities and participating equity securities, which parallel the
recently created participating security created to finance SBIC's.
In a few key respects, however, the CTIC program is different from
the SBIC program. First, the CTIC program will require that the
licensed investment companies make investments exclusively in critical
technology ventures. Recognizing that technology investments are often
riskier than other types of investments and that the budget of the
Federal Government is tight, S. 4 strictly limits to 15 percent the
cost of the CTIC program under credit reform. This will allow for the
subsidy cost of the CTIC security to exceed the currently estimated
cost of SBIC's participating securities by more than 4 percentage
points, yet it will ensure the costs of this program remain within
reason.
Second, S. 4 establishes a Licensing Committee which will be
responsible for granting licenses to CTIC's and for developing the
operating plan and implementing regulations. The five-member Licensing
Committee will have three members from the Department of Commerce, all
of whom are well-versed in technology and one of whom is a finance and
investment expert. The committee will also have two members from the
SBA, both of whom shall be finance and investment experts. It is
expected that all committee members will use their expertise to license
only the most promising applicants which are financially sound and
likely to succeed. After the licensing stage, the SBA will be
responsible for administering and overseeing the program.
Third, CTIC's will provide financial assistance to small businesses,
as defined by the SBA, and to joint ventures, as defined by the
Licensing Committee. As chairman of the Committee on Small Business, I
encourage the Licensing Committee to not use the resources of this
program exclusively to finance joint ventures. As evidenced by some of
the successes of the SBIC program, some small businesses are very bit
as innovative and may be more deserving of Federal investment than
their more substantial joint venture competitors, who may be able to
draw on the resources of some of America's wealthiest corporations.
The issue of appropriations is a difficult one when joint programs
are involved. S. 4 handles the issue by authorizing appropriations for
the program to the Department of Commerce and directing that a portion
of the appropriation be transferred to the Small Business
Administration in proportion to its share of the program's
administration. This is necessary to ensure that SBA has adequate
salary and expense funds to administer the program responsibly.
From the Licensing Committee to the program's funding, cooperation is
the key to success of this new CTIC program. It, like the technologies
it seeks to encourage, is an innovation. Although Federal agencies
often do not work well together, I have confidence that this program
will be different, because the common goal of providing investment
capital for the development of technology will overcome parochial
concerns. I look forward to the progress of this program as it is
jointly developed by the Department of Commerce and the Small Business
Administration.
I can assure my colleagues that the Senate Small Business Committee
will maintain rigorous oversight of this new program.
Mr. JOHNSTON. Mr. President, I rise to speak in support of title VI
of S. 4, the National Competitiveness Act of 1994. Title VI establishes
the Information Technology Applications Act of 1994. This act amends
and builds on the High-Performance Computing Act of 1991.
The Committee on Energy and Natural Resources, which I chair, and the
Committee on Commerce, Science, and Transportation, chaired by my
distinguished colleague from South Carolina, Mr. Hollings, worked
together in crafting the 1991 act. Again, our committees have worked
together and developed the Information Technology Application Act of
1994.
The program established by the administration pursuant to the High-
Performance Computing Act of 1991, the High-Performance Computing and
Communications Program or the HPCC Program, is an important Federal
investment in high-performance computing and communications
technologies, which are critical to the competitiveness and national
security of the United States.
The HPCC Program has been universally proclaimed as a success, both
in the results achieved and in the manner in which agencies have
coordinated their programs together. Similar research and development
programs have been initiated following the model of the HPCC Program in
advanced materials, biotechnology, and manufacturing.
Since the establishment of the High-Performance Computing Act,
however, the administration has proposed to expend the scope of the
HPCC Program. The administration seeks to establish a new component of
the program--the Information Infrastructure Technologies and
Applications or the IITA. This effort will lead to the development of
applications in high-performance computing and high-speed networking
technologies for use in the fields of health care, energy, the
environment, education, libraries, materials, and manufacturing. The
Information Technology Applications Act of 1994 authorizes the IITA and
provides direction to the administration in carrying it out.
I would like to take a moment to clarify the intent and purpose of
several sections of the Information Technology Applications Act of
1994. The act makes no change to the management structure called for in
the High-Performance Computing Act of 1991. The management and
coordinating mechanisms in place today have produced remarkable
interagency cooperation. There is no reason to change that structure
and the IITA makes no changes. The main purpose of the Information
Technology Applications Act is to call for, as part of the program
created by the High-Performance Computing Act, the research and
development of applications in high-performance computing and high-
speed networking technologies.
Section 609 of the Information Technology Applications Act of 1994
restructures section 102 of the High-Performance Computing Act.
Currently, the High-Performance Computing Act calls for the creation of
the National Research and Education Network. The High-Performance
Computing Act envisions a national network that is accessible to
researchers and educators throughout the country. The High-Performance
Computing Act does not direct any one entity, including the Federal
Government, to build and operate such a network. The High-Performance
Computing Act directs the agencies of the Federal Government to ensure
that agency networking activities are coordinated with each other and
with the private sector with the goal that computer networks throughout
the Nation can be connected together. This, in fact, has happened.
Today, there are thousands of computer networks connected together
allowing millions of researchers throughout the world to communicate
with each other. No one entity, however, has built or operates this
national network. This national network has been created largely
through the voluntary cooperation of those who build and operate
networks. By agreeing on the same standards and protocols, computer
networks can now be linked together and be operated as one national
network. The role of the Federal Government in this effort has been to
act as a central coordinating point and as a catalyst for creating this
national network.
The Information Technology Applications Act would change the High-
performance Computing Act by eliminating the creation of the National
Research and Education Network. Instead a National Research and
Education Network Program is created. As no one entity is creating a
national network and the focus of the High-Performance Computing Act
has always been on the Federal Government's contribution, the creation
of a program is a much better description of the Federal Government's
efforts. The goal, however, has not changed--a national computer
network accessible to researchers throughout the country. The Federal
Government will continue to act as a catalyst and central coordinating
point for connecting together the Nation's computer networks. The
restructured section also calls for a much stronger effort in the
research and development of applications technologies that may be used
on computer networks.
To help catalyze the effort to establish a system of interconnected
networks, the High-Performance Computing Act of 1991 calls for the
Federal Government to carry out research and development of high-
performance computing and high-speed networking technologies. This
research has centered around the development of faster and more
powerful supercomputers and networks, but has not focused on new uses
or applications for high-speed computers and networks. The Information
Technology Applications Act calls for a much stronger research program
in the applications area for developing new uses for high-speed
computers and networks in such fields as health care, energy, the
environment, education, libraries, materials, and manufacturing.
Applications in these areas are now possible because so much of the
Nation has access to a national system of interconnected computer
networks. For example, it is now possible for a doctor to communicate
the results of a CAT scan as they are occurring to a colleague across
country. The two can talk and look at the same time at the results of
the CAT scan. A few years ago this would not have been possible.
Additional research and development will lead to new applications in
many other areas.
The Information Technology Applications Act would add a new section
102(g)(1) to the High-Performance Computing Act. This new section
requires a point of clarification. This section calls for each agency
to procure communications networking services through commercially
available network services, or if these cannot satisfy agency
requirements, then through contracting for customized services. This is
a restatement of current law and of current practices. This language is
not intended to change how agencies procure network services, but
simply restates current agency practices to make clear that Federal
agencies are to continue to competitively procure as much of their
networking services as possible from the private sector as they do
today. As agencies already do this, this section makes no change in
current law.
The final point I would like to make relates to section 606 of the
Information Technology Applications Act. This section amends the High-
Performance Computing Act to direct the Secretary of Energy to develop,
test, and apply high-performance computing and high-speed networking
technologies in areas within the Department's missions such as energy,
the environment, manufacturing, materials, health care, education and
training, financial services, and law enforcement.
Historically, the Department has been the lead Federal agency in the
development and use of high-performance computing technologies. The
Department operates more unclassified supercomputers than any other
entity in the world and has working relationships between its national
laboratories and most of the high-performance computing vendors. The
Department connects its laboratories and researchers located throughout
the world together through one of the Federal Government's largest
computer networks. Some of the Nation's premier high-performance
computing systems, applications, and networking capabilities have been
developed, perfected, and routinely utilized by the Department's
scientists and engineers in pursuit of the Department's missions. the
Department has unique and extensive capabilities that could provide
major contributions to the administration's Information Infrastructure
and Technology Applications or the IITA Program. Considering the
Department's expertise in high-performance computing, the Department
should have at least an equal, if not larger, role in the
administration's IITA, than the other agencies.
Thus, I was disappointed that a role for the Department was not
specified when the administration first proposed the IITA. The
administration maintained that the Department had not established what
role it could play in the IITA. The Department of Energy subsequently
identified the potential applications and technology contributions it
could make to the IITA. Section 606 would establish the Department of
Energy's role in the administration's IITA.
Information is one of the Nation's most critical economic resources.
I welcome the administration's efforts to improve on the High-
Performance Computing Act by developing a program to develop new ways
for this country to benefit from this resource. With the authorization
and guidance provided by the Information Technology Applications Act,
the administration can move forward with this most important
initiative.
I urge my colleagues to support passage of the Information Technology
Applications Act.
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