[Congressional Record Volume 140, Number 47 (Tuesday, April 26, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: April 26, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                          GATT TREATY CONCERNS

  Mr. PRESSLER. Mr. President, I rise to raise some concerns about the 
upcoming GATT treaty that will be considered by this body soon.
  As I understand it, the Senate will be voting on legislation to 
implement the new GATT agreement. I have some real problems with the 
GATT agreement.
  Let me say, first of all, that I am a free trader. I believe that 
trade is one of the best ways to get along with other countries and to 
promote prosperity. But I also believe in equal treatment. If other 
countries' products come into our country, our products should be able 
to go into theirs on an equal basis. When I say I am a free trader, a 
lot of people in the world hear that we are going to open up our 
markets, but their markets remain closed.
  Mr. President, as a member of the Senate Foreign Relations Committee, 
and the Commerce Committee, and prior to that as a soldier in the Army, 
and as a student, I have visited over 140 countries in my lifetime. I 
always find that these other countries want to send their products into 
the United States. They say: ``We are just a little country. We put 
tariffs on your products. We are so little it really does not matter.''
  But it does in a cumulative way. The American taxpayer is actually 
paying, and the American consumer is subsidizing these other countries 
in trade. That has been particularly true with Japan over the last 10 
years, but it is also true with a number of other countries as well.
  Now we have the GATT treaty which has been signed by the United 
States. But under our system of laws, legislation to implement the new 
agreement has to come to the Congress for approval.
  I have great concerns with the GATT treaty. I think we should take a 
look beyond just the first step, because when we think about the GATT 
agreement most think of only the world's major powers being involved. 
But what is being proposed to be created is a 125-nation governing 
board where majority vote will rule. This means that a lot of small 
dictatorships--and most countries in this world are still 
dictatorships; they are not democracies--a lot of small countries that 
do not have the same value system that we have, will be voting and 
maybe outvoting the United States on trade matters.
  I am not so sure that we want to turn over our sovereignty on 
bilateral trade agreements to an international council of 125 nations.
  Also, I am concerned with the proposed environmental committee of the 
World Trade Organization. Who could be against an environmental 
committee? Yet this environment committee will have great power over 
nations. There also is a new country of origin committee.
  But what is really behind this is their agenda to raise money to 
assess the U.S. taxpayers to pay in, just like the United Nations where 
they assess us so much and they say we are in arrearage if we do not 
pay. We are paying 31.7 percent of all peacekeeper efforts at the 
United Nations, for example, while some of our rich allies are not 
doing their fair share, in this Senator's judgment.
  This has all the makings of an international organization that will 
cause a lot of trouble. Probably it will not cause as much trouble in 
the first year or 2, but once we get into that third, fourth, and fifth 
year and looking down the road 10 years, I think the United States 
might well regret that it entered into this GATT agreement the way it 
is structured.
  So I have some very serious structural problems. What can we do about 
it now--the Clinton administration has signed the treaty--there are a 
number of things. If the Senate should reject it, it could go back and 
be renegotiated. But let us take a very careful look at this majority 
rule of these 125 nations. It does not have the same safeguards as in 
the United Nations where we have the Security Council safeguard, on the 
basic important decisions where the great powers have reserved their 
right for a veto.
  Here in the World Trade Organization we are turning over a lot of 
trade decisions to a 125-nation group where majority rule will prevail. 
And the majority of the WTO will be developing countries, 
dictatorships, countries that want to get products from the United 
States with nothing in return, countries that are not practicing human 
rights, and countries that do not have the same standards that we have.
  So let us think very carefully about what we are doing in the 
upcoming GATT treaty. This has not been brought up very much in our 
media. It has not been brought up very much here on the floor of the 
Senate. I intend to try to bring it up in a series of speeches, and I 
would like to get some discussion going on the structural organization 
we are accepting in the GATT treaties.
  Let us be careful, because once the WTO is created, everyone will 
say, oh, we did not realize we were turning this much power over, or we 
did not realize the bureaucrats over in Vienna or Geneva were going to 
be controlling U.S. trade and/or making our environmental laws. Watch 
out.
  I am all for a clean environment. I am an environmentalist. But when 
you read the fine print, these new committees have a lot of power and 
could assess taxes and payments on the United States. You know who 
those 125 countries are going to ask most for the payments. They are 
going to be after the United States. We will do our fair share. We do 
more than our share, and we should, because we are a prosperous 
country. But I do not want us taken advantage of.
  So this Senator reserves how he is going to vote on the GATT treaty. 
I may well oppose it on the structural grounds, and I wish that the 
Clinton administration had not agreed to the proposed environmental 
concerns. I wish they had stuck with the Bush position. But it seemed 
they were so eager to get agreement to show progress on trade, that 
they signed this agreement. Now the Senate has the heavy duty of 
lifting, so to speak, of being very careful about entering into that 
GATT treaty.
  Mr. President, I ask unanimous consent to print an additional 
description of the 125-nation committee in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

            The New World Trade Organization Under the GATT

       In 1948, the GATT--the General Agreement on Tariffs and 
     Trade--was created. The GATT is a multilateral instrument 
     designed to serve as the world's governing regime for 
     international trade. Its primary objective is to achieve 
     substantial reduction of tariffs and other barriers to world 
     trade. The organization provides a framework within which 
     international trade negotiations are conducted and 
     international trade disputes are resolved. The GATT is 
     headquartered in Geneva, Switzerland.
       On April 15, 1994, 125 countries signed a new General 
     Agreement on Tariffs and Trade. This new agreement resulted 
     from seven years of negotiations. Once the new GATT is 
     ratified by all 125 signatory countries, the World Trade 
     Organization will be created. At that time, the WTO will 
     replace the GATT. Under the new agreement the WTO would 
     function as an expanded organization from what GATT is 
     currently.
       The new GATT agreement created a World Trade Organization 
     (WTO) as a legal entity to control the foundations of trade 
     among its members countries. Unlike GATT, which is simply a 
     framework of an agreement, the WTO would have international 
     legal status, headquarters, staff and a budget.


               functions of the world trade organization

       The WTO will implement and administer the new GATT. It will 
     provide the forum for negotiations among its members 
     concerning their multilateral trade relations under the new 
     agreement. The WTO will administer the new rules and 
     procedures governing dispute settlements and overall trade 
     policy review. In economic areas, the WTO will work with the 
     International Monetary Fund and the International Bank for 
     Reconstruction and Development.


               structure of the world trade organization

       Under the WTO, a Ministerial Conference comprised of all 
     signatory nations is created. The Conference will meet once 
     every two years. The Ministerial Conference will appoint a 
     Director-General and establish the powers, duties, conditions 
     of service and terms of office of the Director-General. A 
     Secretariat of the WTO also is established, to be headed by 
     the Director-General.
       A General Council, composed of representatives of all 
     members, is formed and shall meet as appropriate. The General 
     Council shall discharge the responsibilities of the Dispute 
     Settlement Body and the Trade Policy Review Body. Both of 
     these bodies will have their own chairman and establish rules 
     of procedure necessary for the fulfillment of their 
     responsibilities. Similar bodies exist under the present 
     GATT.
       The Ministerial Conference will establish three committees 
     which also exist under the present GATT structure. They are:
       Committee on Trade and Development.
       Committee on Balance-of-Payments Restrictions.
       Committee on Budget, Finance and Administration.
       However, the Ministerial Conference also will create the 
     following new committees:
       Agriculture.
       Environment.
       Rules of Origin.
       The WTO will be responsible for determining environmental 
     impacts and concerns arising from all future trade. It is 
     empowered to recommend actions where appropriate.
       Three other new entities are created under the new 
     agreement:
       Council for Trade in Goods.
       Council for Trade in Services.
       Council for Trade-Related Aspects of Intellectual Property 
     Rights.
       These councils will operate under the auspices of the 
     General Council and will carry out the functions assigned to 
     them by their respective agreements under the new GATT and by 
     the General Council. These councils also will establish 
     subsidiary bodies where required.


                         decisionmaking process

       The WTO will continue the practice of decisionmaking by 
     consensus followed under the GATT since 1947. When a decision 
     cannot be reached by consensus, the matter at issue will be 
     decided by voting. At meetings of the Ministerial Conference 
     and the General Council, each member of the WTO shall have 
     one vote. A majority vote is required for decisions by the 
     General Council, unless otherwise provided in the Agreement.
       The Ministerial Conference and the General Council shall 
     have the exclusive authority to adopt interpretations of the 
     Agreement.


                                 budget

       The Director-General will present to the committee on 
     Budget, Finance and Administration an annual budget estimate 
     for the WTO. This committee will propose to the General 
     Council financial regulations establishing: (1) the scale of 
     contributions apportioning the expenses of the WTO among its 
     members; and (2) the measures to be taken regarding members 
     in arrears.
       The General Council will adopt the annual budget by a two-
     thirds majority comprising more than half of the members of 
     the WTO. Each Member will contribute to the WTO its share in 
     the expenses of the WTO in accordance with financial 
     regulations adopted by the General Council.

  Mr. PRESSLER. I yield the floor.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BOND. 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. BOND. Mr. President, let me begin by commending the chairman and 
the ranking member of the Banking Committee for the hard work that has 
gone into the issue of resolving the questions around interstate 
banking and branching. This has been a very important and a contentious 
issue which we have worked on for a number of years. The Senate has 
been trying for a long time to get legislation enacted which would 
provide for interstate banking and branching, and I believe we can see 
the light at the end of the tunnel.
  I intend to support the legislation as drafted because I do believe 
it takes us in the right direction but also because I am a supporter of 
State's rights. I would prefer that the bill contain some amendments 
which I believe may be offered by one of my colleagues on the other 
side. The provisions I specifically address are, No. 1, to allow for a 
3-year period in which States may have time to consider changes in 
State laws which are necessary to the implementation of this act. I 
believe, since we do have a dual banking system where State regulation 
is important, that we should give States that opportunity.
  Second, I would like to ensure that State laws apply to all branches 
of out-of-state banks, both Federal and State chartered. Discussions 
are underway I understand at this time involving the National Governors 
Association and responsible parties in the administration. I hope we 
will have an agreement from them which will be accepted by my 
colleagues because I do believe we should move in this direction.
  Although I believe that interstate banking is clearly a positive step 
for banks, both competitively and economically, I also believe that 
each State should have the right to decide what is best within its 
borders. That is something I hope is considered favorably by my 
colleagues.
  In addition to the major point of interstate banking which is before 
us today, I do want to discuss with my colleagues S. 783, the Consumer 
Reporting Reform Act of 1994. This bill passed the Banking Committee by 
a vote of 15 to 4 late last October.
  Mr. President, I have been working on this legislation for about 4 
years, and with Senator Bryan, who has taken the lead on this, we have 
come together on the measure which is S. 783. It is a bill to reform 
the Fair Credit Reporting Act, and we may offer it as an amendment to 
S. 1963. That is something we need to discuss with the managers of the 
bill as well as the leadership. We introduced this legislation back on 
April 7, 1993. Hearings were held in May of last year. I believe the 
time has come to move forward on this bill.
  Let me tell you why. The Fair Credit Reporting Act is ripe for 
revision. I have heard too many horror stories, and we have had them 
laid out in testimony before the Banking Committee, not to believe this 
area is ripe for reform. The act was written long before computer 
technology was as sophisticated as it is today. These technological 
advances have meant a drastic increase in the amount of information 
that can be kept on individuals.
  It is quite clear to me that current law simply does not do the job 
of adequately protecting consumers. Although consent decrees obtained 
by the FTC have had a significant impact, I think that Congress, not 
the courts, should be legislating in this area and we should not leave 
all of the important decisions to the administrative bodies.
  The PRESIDING OFFICER. If I may interrupt the Senator, we have an 
order to recess at noon, and, in order to continue, the Senator will 
need to ask unanimous consent.


                           Order of Procedure

  Mr. BOND. Mr. President, I ask unanimous consent to continue for 5 
minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BOND. Mr. President, I thank the Chair.
  Mr. President, let me also put in a word of thanks to the credit 
bureaus, a group that does not normally receive thanks in this body, 
but they have taken steps to make the system more accurate, and we 
commend them for it. They have moved in the proper direction. But I do 
believe that legislation will still he needed. Congress must very soon 
address the concerns of accuracy in the system and the need for 
consumer privacy. If my colleagues are in the same position as I am, 
they have undoubtedly heard from many, many people about their problems 
with credit reporting.
  I believe that S. 783, as reported by the committee, addresses those 
concerns. It establishes a 30-day reinvestigation time period so 
consumers can resolve their disputes in credit reports in a timely 
manner. It requires employers to get an employee's consent before 
pulling the employee's credit report. It improves consumer disclosures 
so that consumers are informed of their rights whenever they receive 
their credit report and whenever adverse action is taken against them 
on the basis of their report.
  It imposes duties on the furnishers of information so that they 
cannot furnish information to the credit bureau that they know is 
incomplete or inaccurate. And it imposes a civil liability on those 
furnishers who fail to fix a consumer's file when the consumer disputes 
information which has been furnished.
  In addition, S. 783 applies a uniform Federal standard to govern 
certain parts of credit reporting and a section allowing consumers a 
free credit report every other year upon written request.
  I think we have reached a reasonable compromise on these last two 
contentious issues. The bill preempts prescreening, information shared 
among affiliates, reinvestigation timetables, and certain disclosure 
forms.
  I believe that in all of these areas there is a strong interstate 
commerce argument for having one standard. It will greatly simplify 
compliance with the act and lessen some of its burdens.
  The bill also provides for a free report from the nationwide credit 
bureaus, upon written request, every other year. I think that allowing 
consumers to get a free report is a strong step toward making the 
system more accurate and protecting the rights of consumers.
  It is a well-balanced bill. All interested parties get some things in 
the bill that they do not have in current law. The consumer groups get 
increased disclosure and a 30-day reinvestigation time period. The 
credit industry gets a limited Federal preemption, the ability to share 
information among affiliates, and broader prescreening and direct 
marketing abilities.
  I realize there are issues in the bill which still need to be 
addressed. Senator Bryan and I plan to fix the civil liability section 
to make it absolutely clear that there are only private causes of 
action against a furnisher after that furnisher has had an opportunity 
to reinvestigate and fix mistakes.
  We have not tried at this time to amend S. 783. We recognize that 
these issues and others need to be addressed, and we intend to work 
with our colleagues both in this body and in the House on a bipartisan 
basis. And I hope that we will not be required to bring up this bill as 
an amendment to the interstate branching and banking bill but that we 
will be able to determine when there will be some time when we can go 
forward so that we can act on this bill and make sure that the 
protections and the badly needed update is made in Federal legislation 
in this vitally important area.
  I thank the Chair.
  Mr. BRYAN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Nevada.


                           Order of Procedure

  Mr. BRYAN. Mr. President, I ask unanimous consent that I might 
proceed for another 5 minutes. I recognize the time constraints of the 
Chair. I hope it will be less.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BRYAN. Mr. President, thank you very much.
  Mr. President, I want to commend my colleague, Senator Bond, who has 
worked tirelessly over the past several years trying to craft a piece 
of legislation which, in my view, is the most important consumer 
protection legislation that we could offer in this session of the 
Congress.
  I think we are extremely close to being there as a result of his 
leadership and support and that of our respective staffs and many with 
whom we have had occasion to work very closely over these past several 
years.
  Mr. President, let me just embellish upon one additional point, and 
that is, we have been trying to get on this piece of legislation since 
last October, as my colleague and friend from Missouri has shared with 
us. We have been unable to do that. I hope that it will not be 
necessary for us to offer an amendment to this piece of legislation 
that is currently before the body because it is not my purpose to in 
any way prevent timely action upon it. But this legislation is 
extremely important.
  On October 28 last year, the Senate Committee on Banking, Housing, 
and Urban Affairs marked up and reported out S. 783 by a vote of 15 to 
4.
  This amendment is the exact language of S. 783.
  This legislation will improve the accuracy of the 450 million credit 
reports kept on about 90 percent of all Americans.
  When the original Fair Credit Reporting Act was passed 20 years ago, 
it provided a number of important consumer protections.
  In the intervening 20 years, the credit reporting industry has 
undergone dramatic changes--from keeping consumer information on 
handwritten file cards to computer tapes that are updated with billions 
of entries every month.
  The time has come to update this law.
  This act is one of the most significant actions we can take that will 
benefit consumers nationwide.
  There are too many lives that are being adversely affected by 
inaccurate credit reports.
  Even as we speak, people are being turned down for student loans, car 
loans, and mortgages--people are being turned down for jobs or 
promotions--all because of faulty information on credit reports.
  Mr. President, I can attest personally that there were inaccuracies 
in my own credit report as I sought to refinance my home.
  I was able to clear up the inaccuracies on my report without too much 
difficulty--but I am sure being a U.S. Senator did not hurt either. The 
average citizen does not have that ability.
  I am not here to suggest, nor does my colleague from Missouri, that 
the people involved in the credit reporting business are irresponsible 
or disreputable. But the fact remains that there are 450 million credit 
files, 2 billion pieces of data each month, and that 1.5 million 
reports every day are sold. That volume lends itself to inaccuracies. 
And as Senator Bond has indicated, our legislation is simply designed 
to keep those mistakes to a minimum, and once they are filed to provide 
a corrective mechanism so that they can be found.
  I do not believe that businesses engaged in credit reporting are 
disreputable, irresponsible firms.
  These firms maintain 450 million credit files and must input 2 
billion pieces of data each month and sell 1.5 million reports every 
day.
  With that kind of volume there are bound to be mistakes.
  The question then becomes how do we keep the mistakes to a minimum 
and how do we keep the mistakes to a minimum and how do we fix them 
once they are found? That is where our legislation comes into play.
  First, to keep the mistakes to a minimum we must give the firms that 
furnish information to credit bureaus--the retailers, credit card 
companies, and mortgage companies--the incentives to supply as accurate 
information as possible.
  Our legislation does just that by authorizing the Federal Trade 
Commission [FTC] to take action against businesses that have a practice 
or pattern of submitting inaccurate information.
  Second, to fix mistakes when they are discovered our legislation sets 
up a reinvestigation process that makes it more consumer friendly.
  I think most people are sympathetic to the fact that credit bureaus 
are going to make honest mistakes.
  With a common last name like mine, I can relate to the difficulties a 
credit bureau faces trying to match up credit information with the 
proper file.
  When I do think incenses people is the inconvenience they can be put 
through to get a mistake fixed.
  I chaired hearings out in my State of Nevada and heard testimony from 
scores of individuals who were put through the ringer to get inaccurate 
information removed from their files.
  People get mad when through no fault of their own, they are forced to 
spend countless hours calling and writing to get mistakes removed.
  They are forced to track down hard-to-find records or prove some 
information on their file does not belong to them, a difficult task.
  This can be both time consuming and frustrating. I know, I have been 
there.
  If our legislation accomplishes nothing else, I intend that it will 
turn around the burden of proof so that credit bureaus and furnishers 
of information will be responsible for verifying the accuracy of 
information when an individual disputes it.
  I cannot emphasize how important this is for consumers everywhere.
  Another recurring problem is that mistakes keep reappearing on a 
person's report even after the individual has brought the inaccuracy to 
the credit bureau's attention.
  Our bill would require the agency to notify the individual before 
reinserting data which has been previously removed.
  Individuals would also be able to request a free copy of their report 
for 1 year afterwards to insure the mistake has not crept back in.
  Our legislation has been carefully crafted so that it will not 
inhibit the flow of information to credit bureaus.
  It recognizes that if information is cut off, the consumer ends up 
the loser.
  That is why a delicate balance has been crafted to provide incentives 
to businesses to supply accurate information while not discouraging 
them from furnishing it.
  Furnishers of information will not be liable for the routine mistakes 
that naturally occur when processing millions of data entries every 
month.
  So, this amendment does not contemplate perfection, just a good faith 
effort to supply accurate information.
  There are too many lives that are being adversely affected by 
inaccurate credit reports not too make every effort to improve the 
system.
  Student loans, car loans, and mortgages and even job promotions, all 
hang in the balance because of faulty information on credit reports.
  While we will never eliminate human error, or computer error for that 
matter, from the credit reporting process, I believe we can and should 
do better.
  I yield the floor.
  Mr. President, I thank my colleague who has been inconvenienced by my 
extended remarks, for his courtesy to me.
  Thank you, Mr. President.

                          ____________________