[Congressional Record Volume 140, Number 89 (Tuesday, July 12, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: July 12, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                              WORLD TRADE

  Mr. MOYNIHAN. Mr. President, as the Senate returns from the Fourth of 
July recess, the President returns from an important, indeed in ways, 
historic visit to Western and Central Europe. We welcome him back, even 
as he and the other heads of the world's leading industrial 
democracies, the G-7, welcomed Mr. Yeltsin to their meeting in Naples. 
At the same time, we share what must be the President's disappointment 
that the G-7 as a group did not agree to his proposal to begin a review 
of remaining trade barriers to be placed on the agenda for the G-7 
meeting next year in Halifax.
  The President was kind enough to ask Ambassador Kantor to call me in 
New York last Wednesday to outline the proposal he was going to make. I 
could only speak for myself, but I assured the Ambassador, our 
distinguished friend, that the President had my full support, and that 
I could not doubt that the Committee on Finance would feel the same 
way.
  Note that I referred to remaining trade barriers. There are more than 
a few to be sure. But the great fact of this moment is the successful 
completion of the Uruguay round of Multilateral Trade Negotiations, 
conducted under the auspices of the General Agreement on Tariffs and 
Trade. The negotiations took 7 years, culminating in the vast agreement 
reached last December in Geneva, and initialed in an international 
conference in Marrakesh this past April. It now remains for the 
Congress to enact implementing legislation so that an essentially new 
world trading system can go into effect January 1, 1995.
  I have been involved with trade matters for some time, going back to 
the Long Term Cotton Textile Agreement negotiations in Geneva in 1962, 
which were crucial to the success of the Kennedy round, an agreement 
literally crucial to getting Congress to agree to give President 
Kennedy the authority to negotiate the Agreement that was subsequently 
named for him. Indeed, I can remember the GATT when it consisted of 
little more than Eric Wyndham White and a few French secretaries housed 
in a villa just above Geneva. We may hope that the new World Trade 
Organization keeps to that tradition of cordiality and frugality. 
Indeed, the venerable Harry Hawkins, who in the 1930's handled the 
Multilateral Trade Agreements program for Secretary of State Cordell 
Hull, did his best to teach me the subject more than 40 years ago. The 
GATT, of course, was an ad hoc arrangement put in place after the 
Senate Finance Committee refused to accede to the proposed 
International Trade Organization that was to institutionalize the 
Multilateral Trade Program as one of the post war institutions such as 
the World Bank, as it is generally known, and the International 
Monetary Fund.
  Hence, I have had no difficulty seeing the Uruguay round as the 
culmination of 60 years of American trade policy pursued with 
remarkable consistency and bipartisanship from the time of President 
Roosevelt. Last Thursday, I notified members of the Committee on 
Finance that the committee would begin markup of the implementing 
legislation on Tuesday, July 19, 1 week from today.
  The more then was it a blow to pick up Friday morning's Wall Street 
Journal and to read in the lead item of ``Washington Wire'' that 
``Clinton aides privately worry that Congress might not even get to the 
world trade pact this year.'' Mr. President, I have the complete text 
of the Wall Street Journal item, which I ask unanimous consent be 
printed in the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

              [From the Wall Street Journal, July 8, 1994]

 Problems Nag Clinton on GATT, Even as He Praises the Trade Pact Abroad

       GOP stalwarts Howard Baker and Lawrence Eagleburger 
     organize a ``strategy session'' of business representatives 
     to discuss fears that the agreement's new World Trade 
     Organization could allow environmentalists to construct 
     barriers blocking U.S. exports. A Baker memo says ``a 
     number'' of his law firm's clients ``have expressed 
     concerns'' about how the pact will be enforced.
       Clinton and G-7 colleagues at this week's economic summit 
     will pledge anew to ratify GATT this year. But Clinton aides 
     privately worry that Congress might not even get to the world 
     trade pact this year. GATT foes fuel the debate by spreading 
     charges that the World Trade Organization would usurp U.S. 
     sovereignty.
       GATT still could be introduced and passed next year, if 
     necessary.

  Mr. MOYNIHAN. Mr. President, what is going on here?
  Let me first state that there can be no questioning the accuracy of 
the Journal's report. Note the plural ``Clinton aides.'' This is the 
journalistic practice of getting two sources to confirm a report.
  Let me go on to state that, regrettably, this is nothing new. The 
health care debate has been plagued with press accounts of White House 
aides doubting this Senator, questioning that committee, detecting 
hidden motives--the while, of course, hiding themselves behind the 
anonymous leak.
  Those leaks have not done the President's health care legislation any 
good.
  If the pattern now takes hold as regards the implementing legislation 
for the Uruguay round, it could be ruinous.
  The full Senate may not be aware of the work that has been going on 
in the Finance Committee, work which has brought us to the point of 
scheduling a markup next Tuesday.
  That work began over 1 year ago, with the expiration on May 31, 1993, 
of the President's authority to negotiate in the Uruguay round and to 
have that agreement considered under fast-track legislative procedures. 
Without that authority, the negotiations were finished. The President 
requested an extension of the fast track and the Finance Committee, 
after careful consideration, granted the request by a vote of 18 to 2. 
The full Senate followed with its approval on June 30, 1993, by an 
equally resounding vote of 76 ayes and 16 nays. The legislation passed 
without amendment. Many said that could not be done; that the Senate 
would not refrain from amending when such an opportunity came along. 
And there were moments of doubt, I recall, as I asked Senators to defer 
amendments on trade issues of importance to them, given the greater 
importance of the Uruguay round. But we succeeded--the Congress 
delivered the authority to the President before he left for last year's 
G-7 summit in Tokyo.
  Then last fall, immediately after passage of the NAFTA, I traveled to 
Geneva to be present for the final days of the Uruguay round 
negotiations. My purpose--to deliver a message on the importance of 
that agreement to the Committee on Finance.
  My distinguished colleague, Senator Rockefeller, was there as well 
and joined in pressing for what we made clear we would consider an 
acceptable agreement--an agreement which was, indeed, reached. I stayed 
1 week. Our very able chief trade counselor, Marcia Miller, stayed 
there to aid in the effort to wind up that agreement, which was done 
with such success.
  Well before the Uruguay Round Agreement was signed on April 15, the 
Committee on Finance was working with administration officials to draft 
the necessary legislation to bring United States law into conformity 
with that very considerable agreement. By the time of its signing, we 
had held four public hearings to review the agreement's provisions, and 
consider proposals for that legislation.
  While the Uruguay round offers enormous benefits, it is also fair to 
say that it is enormously complex. The agreement itself runs to 22,000 
pages, once the specific commitments of each country are included. 
Indeed, to date this year, the committee staff has held nearly 200 
meetings reviewing proposals for the legislation with the 
administration, the Ways and Means Committee staff, and legislative 
assistants for Finance Committee members. Of these meetings, nearly 
half have involved drafting the legislation. When the committee begins 
its markup next Tuesday, it will work from a 130-page document 
describing the legislation. The bill itself runs to nearly 300 pages, 
before the committee has considered a single amendment, and clearly 
there will be some.
  And I speak, of course, just of the work of the Committee on Finance. 
But there is also legislation to be drafted by the Committees on 
Agriculture, Commerce, Foreign Relations, Governmental Affairs, and 
Judiciary.
  Could we have acted earlier? Could this markup have been held before 
now? One might cite as the cause of delay the committee's preoccupation 
with health care, a matter of great importance to this administration 
and to the country, and to the Senate. But, for the record, I must 
point out that the administration's proposals for the most complex 
elements of this legislation--the antidumping and countervailing duty 
amendments--have only just been completed. It was 1 week ago that the 
committee staff received the last of the administration's 
recommendations in this area. Indeed, the legislative drafting exercise 
on this part of the bill continues to take tortuously long and it is 
not yet complete.

  And on the most fundamental issue of funding, we still have no formal 
administration proposal. Under the Budget Act, the legislation must 
include provisions to offset the tariff revenues lost because of the 
Uruguay round. We must accept that the Senate will not waive the Budget 
Act with respect to the requirement that we pay for the first 5 years 
of this revenue loss. We may not like that situation, but we are 
resigned to it.
  I have accordingly asked the administration to meet with the 
committee on this matter of funding. If the committee does not hear a 
proposal from the administration this week, there will be no markup 
next Tuesday. We have to have the funding proposals this week. This 
argument was signed last November, initialed in April, and here we are 
in July.
  The administration neglects to put forward these most necessary 
provisions, but it has suggested at the same time it would like other 
elements added to the legislation. It asks for 7 years of fast-track 
authority for undefined future trade agreements, new laws to govern 
trade with Russia, and NAFTA-like benefits for Caribbean countries. If 
the administration is concerned that the Congress might not get to the 
Uruguay round, then why is it proposing to slow down consideration with 
these additional, and I have to say controversial matters?
  Mr. President, I am committed to acting on the Uruguay round this 
year. In a study entitled ``Assessing the Effects of the Uruguay 
Round,'' the OECD concludes that, over the next 10 years, the U.S. 
gross domestic product will increase $160 billion as a result of the 
Uruguay round. A similar study, ``Trade Liberalization: Global Economic 
Implications,'' produced jointly by the OECD and the World Bank, 
concludes that, once phased in, the round will add $213 billion per 
year to world GDP. Some dispute the magnitude of the gain, but none 
contest the basic proposition. I ask my colleagues, how can we afford 
to delay that gain?
  Moreover, delay creates risks. It breeds opposition. I offer to you 
the fate, earlier cited, that befell the proposed International Trade 
Organization after World War II. Hostility in the Finance Committee; 
little enthusiasm in any quarter. Approval of the ITO languished, and 
in the end it died for lack of support.
  One must not forget that the proposal for an International Trade 
Organization, and the reforms of Cordell Hull's reciprocal trade 
agreements program, were conceived to ensure that the history of the 
Smoot-Hawley Tariff Act of 1930 not repeat itself. After Congress and 
President Hoover enacted that infamous tariff increase, international 
trade plunged 60 percent in 2 years. Smoot-Hawley precipitated a trade 
war with political repercussions, as key states turned away from free 
trade and toward more regional arrangements. Britain with its 
Commonwealth, Japan and its Co-Prosperity Sphere. Then the breakdown of 
world peace followed the breakdown of world trade.
  Our post-war leaders rightly believed that stronger international 
economic institutions were essential to prevent a repeat of the Smoot-
Hawley disaster. When the United States failed to approve the 
International Trade Organization, the world was left with the GATT--an 
interim arrangement with little organizational structure, left to 
evolve ad hoc over the seven rounds of trade negotiations preceding the 
Uruguay round. Certainly not an international organization to stand 
alongside the World Bank and the International Monetary Fund as pillars 
of the post-war economic system.
  With the Uruguay round, we have before us a proposal that would 
finally make good on the vision of our post-war leaders. The 
establishment of a World Trade Organization. And we have the basis of a 
hugely enlarged world trading system.
  I understand there are concerns about the new organization, and they 
deserve to be heard. At the Finance Committee's March 16 hearing, 
consumer advocate Ralph Nader warned of a potential loss of American 
sovereignty. The Wall Street Journal tells us the business community 
fears that, in the name of environmental interests, the World Trade 
Organization will permit trade restrictions. I will invite Mr. Baker 
and Mr. Eagleburger to meet with the Committee on Finance so we might 
hear of those concerns as well. I have also met with Jerry Junkins, who 
is chairman and CEO of Texas Instruments and chairman of the Alliance 
for GATT NOW, which represents 200,000 companies who support the 
Uruguay round.
  This is not the first time we have seen concerns such as these voiced 
about United States participation in international institutions. I 
cite, for example, the International Labor Organization. Created by the 
Treaty of Versailles, the ILO began its existence in 1919 right here in 
Washington--at the Pan American Union Building on Constitution Avenue--
although it took 15 more years before Franklin Roosevelt and Frances 
Perkins finally led the United States into the ILO IN 1934. This year, 
it celebrates its 75th anniversary.
  I speak of the ILO from experience. In 1975, when I was Permanent 
U.S. Representative to the United Nations, it fell to me to draft the 
letter giving the required 2-year notice of our intention to withdraw 
from the ILO--the proceedings of which had become preoccupied with 
anti-democratic and anti-Israel polemic. Two years later, as a freshman 
Senator, I moved our withdrawal in the Senate. That had the desired 
result, and in 1980 I moved our return to the ILO, which was done.
  I have led the effort in this body to renew American interest in and 
respect for the ILO and its body of work. For 35 years, beginning in 
1953, the United States failed to ratify a single ILO convention. We 
finally ended that stalemate by ratifying two conventions in February 
1988--with support from Senator Hatch and others on the Republican 
side. A tremendous breakthrough. A clear signal that the United States 
was ready to participate actively in a new era of ILO history.
  We ratified another convention--our tenth overall--in 1990. And with 
the ratification in 1991 of Convention 105 on the abolition of forced 
labor, the United States reached a milestone--finally adopting one of 
the ILO's core human rights conventions.
  Let us move forward in a similar positive light with respect to the 
World Trade Organization. Should it, at some future point, not serve 
the best interests of the United States and the world trading system, 
we have the ability to withdraw, given 6 months notice. But let us not 
miss this historic opportunity to take a huge step forward on trade by 
engaging in leaks, distortions, and innuendo.
  I can only ask and hope that the administration will see the urgency, 
that White House aides will stop undermining the President in this 
regard and that we go forward next Tuesday as scheduled.
  I thank the Chair for his courtesy.

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