[Congressional Record Volume 140, Number 149 (Thursday, December 1, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: December 1, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                      PIONEER PREFERENCE PROVISION

  Mr. CAMPBELL. Mr. President, for a variety of reasons, I have been 
very torn about my vote on this implementing legislation for Uruguay 
round agreement of GATT.
  I am in complete agreement, though, with the provision in this 
agreement that addresses pioneer preferences granted to innovators in 
personal communications systems technology by the FCC. Administration 
officials, FCC officials, and company officials came up with a deal 
that is fair, and that deal should hold regardless of whether this 
legislation passes. Those who decry this provision as ``elitist'' or 
worse simply do not understand the history and facts.
  In 1992, the FCC awarded pioneer licenses to three PCS innovators. 
One of the companies is Omnipoint Communications, Inc., a small 
entrepreneurial company based in Colorado Springs. At that time, the 
FCC did not charge anything for any spectrum license. In August 1993, 
Congress enacted budget legislation requiring the FCC to auction off 
spectrum licenses. Initially, the FCC excluded the PCS pioneers from 
this requirement. But in August 1994, 2 years after naming the PCS 
pioneers, the FCC ruled that the pioneers including Omnipoint would 
have to pay for their licenses, up to 90 percent of average fees in 
other large markets.
  The pioneers promptly sued, arguing that the FCC had no authority to 
retroactively impose such huge fees. Instead of fighting in court and 
risking complete failure, the FCC crafted an agreement with the House 
Committee on Energy and Commerce: PCS pioneers would pay fees at a rate 
of 85 percent of average fees for the 20 next largest markets.
  Even though this compromise will cost the PCS pioneers from $500 
million to $1 billion in unanticipated fees, they accepted it rather 
than waste time and resources in court--assuming that this was a done 
deal and that they could get on with their development work. Now, 
however, some people are calling this a ``giveaway,'' and some want to 
revisit the issue next year and attempt to force the PCS companies to 
fork over even more dollars.
  It seems to me that the PCS companies, awarded pioneer preferences 
and working constructively with Congress and the FCC, make this 
agreement in good faith, and it ought to stand. It would be very unfair 
to retroactively charge these companies more money. Already, the 
uncertainty over this issue has hurt Omnipoint's ability to attract 
investors.
  By converting military technology to commercial applications, 
Omnipoint is now the manufacturer of the only American noncellular PCS 
radio frequency technology. If PCS is launched soon, Omnipoint is 
likely to become a leading manufacturer of PCS equipment. This will 
mean hundreds of jobs in my State. When coupled with spin-offs and 
export opportunities, it also will mean hundreds of jobs for Americans 
elsewhere in the country. If the deployment of PCS is delayed, many of 
these opportunities will be lost to foreign competitors.
  Whatever happens with this GATT legislation, I will continue to work 
to support Omnipoint's efforts and to protect jobs in Colorado.
  Mr. MATHEWS. Mr. President, in the final hours of this Congress we 
have an opportunity to keep America on the course of economic growth 
and trade expansion that have been the hallmarks of the Clinton 
administration and the high point of bipartisan cooperation in this 
body. With a single vote, we have the chance to increase jobs and 
incomes for American families, open closed markets for American goods, 
and bring American consumers a broader variety of lower priced 
products. We have the chance to build upon the success of the North 
American Free Trade Agreement, and to establish the United States as an 
economy to contend with in a new world order. We should--and must--make 
these possibilities into realities by voting to affirm the Uruguay 
accord of the General Agreement on Tariffs and Trade.
  Mr. President, the prospects from an affirmative vote are 
overwhelming. Conservative estimates suggest that implementing GATT 
will create 300,000 to 700,000 American jobs over 10 years. Over that 
same period, we stand to increase our gross domestic product by upward 
of 3 percent, an amount equal to somewhere between $32 billion and $50 
billion. That translates into an average pay raise of $1,700 a year for 
American families.
  Beyond this, strengthened trade rules under the Uruguay GATT will 
give American exporters the level playing field they have demanded and 
deserved for far too long. GATT will implement more effective 
mechanisms for resolving trade disputes, preserve our ability to 
prosecute unfair trade practices, augment our ability to combat foreign 
dumping, and enable us to take more effective action to assure that 
product standards do not bar imports.
  Little wonder, Mr. President, that support for this agreement has 
come from businesses large and small, manufacturers and farmers, 
companies that have long been exporters and companies that long have 
wanted to be, companies with globally established products, and 
companies that desperately need recourse against infringements of 
intellectual property. These people know what is good for their 
business, and we must listen to them if we are to do what is good for 
the United States.
  I know that there will be winners and losers under this accord. But 
that is a fact of economic life which we need to face as a fact and 
deal with realistically. Their experience should teach us that there is 
no safe haven against change, and we are foolish to deny the spectrum 
of American business a world of opportunities in their name.
  I also find it significant that many of the loudest arguments of 
resistance to NAFTA have been retreaded for GATT. In the few slim 
months since we passed NAFTA, the evidence against those arguments has 
mounted. The disasters they predicted have not materialized. That giant 
sucking sound we were supposed to hear is nowhere to be heard.
  You sure do not hear it in my native Tennessee. Tennessee sold more 
than $6 billion in exports last year. Our exports more than doubled 
between 1987 and 1993. Canada, Mexico, and Japan now are Tennessee's 
No. 1, 2, and 3 export customers. They purchased nearly $2.5 billion 
from Tennessee farms and factories in 1993--an increase of 175 percent 
in sales to those nations over 5 years.
  The only thing that keeps Tennessee companies from selling more goods 
overseas and creating new jobs at home are foreign barriers to trade--
the kind of barriers that GATT removes. Through substantially expanded 
and enforced trade rules, the Uruguay accord will be positive for 
Tennessee and for America's Sunbelt.
  Last year, Tennessee's top manufacturing sectors ranked by exports 
were chemical products, transportation equipment, and industrial 
machinery and computers. That jives with the Sun Belt as a whole, where 
leading exports are electrical and electronic components, chemical 
products, and transportation equipment. These are the very industries 
that will have continued export and jobs growth because tariffs will be 
reduced or eliminated by whopping percentages in Japan, South Korea, 
and the European Community.
  That goes for American farmers and farm products, too. American 
farmers are the most efficient producers on the globe. But what keeps 
them from being the most financially fertile producers is the kind of 
foreign production subsidies, export subsidies, and import trade 
barriers that GATT will reduce--especially in Europe. U.S. agricultural 
exports stand to gain between $1.6 billion and $4.7 billion in the year 
2000 and nearly $9 billion by 2005 as a result of this agreement.
  Mr. President, we are just beginning to count the winners from this 
accord, and one of those winners will be our trade deficit. In 6 to 10 
years after we pass the Uruguay accord, the Economic Strategy Institute 
projects an annual improvement of $13.5 billion and 25 billion in our 
trade deficit, including an increase of $3 billion in annual U.S. 
exports of services.
  Another winner will be our budget deficit. We all know what we need 
to do in order to waive the budgetary point of order because of the 
$11.9 billion in lost revenues that GATT will claim. But is we do it, 
GATT soon will more than pay for itself by increased economic gains 
that offset tariff cuts.
  Yet another winner is American ingenuity and innovation. The 
International Trade Commission has estimated that foreigners' piracy of 
U.S. copyrights costs American businesses between $43 billion and $61 
billion every year and costs the American economy 750,000 jobs. The 
Uruguay accord resolves key problems in copyright protection. U.S. 
software producers, pharmaceutical companies, semiconductor 
manufacturers, chemical producers, publishers, and entertainment 
industries will be beneficiaries.
  Just as the benefits of action are great, so are the costs of 
inaction. Fast track authority expires at the end of this year. If we 
open this measure to amendment, a 6-month delay in implementing GATT 
could cost the United States $70 billion in lost production, 25,000 
jobs, and $200 billion in the Nation's economic well-being. Vice 
President Gore is right when he says that delay of GATT will mean the 
death of GATT.
  We must not let that happen. This accord is the culmination of 
American postwar trade policy, the continuation of efforts we have made 
with NAFTA and the Asia-Pacific Economic Cooperative, and the climax of 
hard efforts by three U.S. administrations. And beyond all these 
things, GATT is the future. Let us embrace all the possibilities that 
future brings--face the future without fear, confident that American 
workers and American businesses can compete and prosper. Let's vote 
this agreement into law.
  Mr. McCAIN. Mr. President, the vote before the Senate on the Uruguay 
round of the General Agreement on Tariffs and Trade is more than a 
indication of how well a Republican Congress and Democrat 
administration can work together. I imagine that we will continue to 
have very sharp disagreements on a variety of issues.
  But trade has always been a special case. There has been, since the 
end of the Second World War, a shared vision regarding our Nation's 
trade policy. The bipartisan consensus on the benefits of free trade 
has led to the successful conclusion of seven previous rounds of GATT 
and a corresponding high level of prosperity both in the United States 
abroad.
  Far from simply signaling the level of collegiality the American 
people can expect from the new Congress, today's vote will determine 
whether free trade has a place in both parties' vision for America's 
future. We will decide with this vote whether to take counsel from our 
fears or our aspirations; whether we yield to unfounded fears of 
competition or affirm our confidence in the ability of the American 
worker.
  The agreement before us is historic in its scope. It builds on 
previous GATT rounds by cutting tariffs by over one-third and breaching 
areas formally beyond the reach of international trading rules. It 
seeks to make transparent the sort of barriers that have been used, in 
lieu of high tariffs, to keep American products out of foreign markets. 
Nations will have a greater burden to prove that regulations governing 
such matters as licensing, inspection procedures, and production 
methods are purely a matter of domestic politics and not intended to 
protect national industries.
  The GATT contains the first multilateral agreement to open up trade 
in services, an increasingly important part of the American economy. 
The U.S. service sector will have greater market access in the areas of 
general business services, professional services, information and 
computer services, health services, and environmental services, among 
many other areas. Although our Nation remains the largest exporter in 
terms of goods, and is the world's greatest industrial power, exports 
in the area of services now add $180 billion to our economy annually. 
Creating additional opportunities for these businesses is no small 
accomplishment.
  All together the GATT agreement will add $100 to $200 billion to the 
U.S. economy annually when fully implemented and 1.4 million new jobs 
over the next 10 years.
  In the debate on GATT, we have heard the same old arguments from 
opponents about these numbers: ``They're cooked.'' ``We'll lose more 
jobs than we produce.'' ``Low wages in foreign countries make it 
impossible for American companies to compete.''
  During the NAFTA debate last year, Congress exhaustively considered 
and rejected these claims. There is no need to go over the 
counterarguments again. Let's just look at the facts. NAFTA has been in 
effect for a year. United States exports to Mexico are up 17 percent 
and growing. Increased trade with Mexico has already produced thousands 
of new U.S. jobs, and with our exports growing at the current rate, it 
will produce thousands more.
  The gains from the GATT are goals that three successive 
administrations, Democrat and Republican, have sought to achieve. The 
Clinton administration deserves credit for bringing the negotiations to 
a close, but as was the case with NAFTA, it will take Republicans to 
put the agreement into law. Unfortunately, we will also put into law 
provisions in the implementing legislation that could have been more 
carefully crafted, or are simply unrelated to the GATT.
  Many in my State, and I know many across the Nation, continue to be 
concerned about U.S. sovereignty and the effect that our membership in 
the World Trade Organization will have on our right to decide our own 
laws and regulations. The implementing legislation states unequivocally 
that ``no provision of any of the Uruguay Round Agreements, or the 
application of any such provision to any person or circumstance, that 
is inconsistent with any law of the United States shall have effect.''
  The implementing legislation, however, is not clear with regard to 
the course of action should the WTO demonstrate a pattern of unfair 
decisions against the United States.
  This is where the Republican leader's initiative to establish a WTO 
Dispute Settlement Review Commission is important. As a nation that 
demands our trading partners establish fair trading practices, we 
should seek no unfair advantage abroad, nor should we seek to keep 
competitive products out of our markets. However, we should not be in a 
position where we are forced to comply with the decisions of the WTO 
which go beyond our commitments under the GATT, or that are reached on 
other than an objective basis.
  If there is a demonstrated pattern of unfair decisions against the 
United States, Senator Dole's proposal establishes a mechanism whereby 
we can withdraw from the agreement--our right to set the terms of our 
contracts with foreign governments being the ultimate expression of 
national sovereignty.
  In some provisions, the implementing legislation breaks with the 
continuity of purpose over three administrations by encompassing issues 
unrelated to the agreement.
  In the case of patents, this tendency has created a perilous 
situation for our Nation's inventors--historically one of our greatest 
resources. The implementing legislation goes beyond any of the 
commitments made in the Uruguay round to seek changes the 
administration believes prudent in United States patent laws.
  Signatories agreed that patents should run for 20 years. This is a 
significant achievement for American companies which lose an estimated 
$15 to $17 billion a year to various forms of piracy. In drafting the 
implementing legislation, however, the administration has sought to 
codify a 20-year protection from the date of filing. Because some 
patents take as long as 10 years--and longer--to be approved, the 
legislation threatens to weaken U.S. protection of patents. U.S. 
patents are currently protected for a period of 17 years after they are 
issued.
  Senator Dole also sought to address this issue. He obtained 
assurances that the White House would not oppose changing the terms of 
the implementing legislation if Congress reviews the issue and decides 
to guarantee the current period of 17 years. Many inventors believe 
this is not quite enough. There is no guarantee either that Congress 
will decide to change the law next year or even whether they will 
review it. Despite the serious effort of the Republican leader, we 
would have been better off had the administration simply waited until 
next year to address the issue at all.
  There are other areas of the implementing legislation where I believe 
the administration exceeded the terms of the agreement, or delved into 
completely unrelated areas, either for the sake of convenience or to 
garner support. In addition to patents, the implementing legislation 
contains unnecessary provisions relating to rules of origin on 
textiles, African economic development and workers' rights.
  In an effort, apparently, to gain the votes of members from textile 
producing States, the administration changed the rules of origin on 
imported textiles and apparel to prevent our competitors from spreading 
the production process out among various countries. Because many 
textile producers find it costly to produce goods wholly in one 
country, the provision in the implementing legislation is sure to raise 
the cost of production and the prices of imports.
  Another provision resembling the sort of deals the President thought 
necessary to gain congressional approval of NAFTA is the section 
regarding workers rights. The President is required under section 131 
to ``seek the establishment * * * in the WTO of a working party to 
examine the relationship of internationally recognized worker rights'' 
to GATT obligations. One cannot help but speculate that this was 
included in part to appease those disappointed over the 
administration's failure to win fast-track authority for a new round of 
trade talks focused on workers' rights.
  Provisions such as these put traditional supporters of free trade in 
a very difficult position. Aware that there are many shortcomings in 
the legislation, we are forced to support it in order not to jeopardize 
the overwhelming benefits of free trade. Unless the implementing 
legislation is intolerably flawed, when it comes to a vote on a 
historic worldwide reduction in tariffs, we have to weigh the virtues 
of the agreement itself against our reservations about the implementing 
legislation.
  In the future, I hope we can avoid loading implementing legislation 
with deals intended to pad the voting margin. Free trade can, and 
should, stand on its own. Although the legislation before us today is a 
far cry from the Christmas tree the NAFTA implementing bill became, the 
extraneous provisions it does contain take away from the cause of free 
trade. It is difficult to portray an affirmative vote for the agreement 
as a vindication of the principles of Adam Smith, when opponents can 
justly point to provisions in the implementing legislation with no 
connections to the agreement.
  The revenue measures contained in the implementing legislation create 
similar complications for the agreement.
  It is a simple matter of common sense that reducing tariffs and other 
barriers to American products increases exports; greater exports mean 
greater productivity; and greater productivity means more Federal 
revenues. In fact, it has been estimated that for every dollar lost 
because of lower tariff rates, the increased economic activity 
resulting from the GATT will create $3 in new revenues.
  Despite indications that the administration subscribes to this 
truism, the implementing legislation contains a score of revenue 
measures, at least one of which has opened the agreement to 
considerable criticism. It seems to me that if anticipated Federal 
revenues negate the need to offset a portion of the tariff losses 
resulting from the GATT, they should negate the need to offset any 
tariff losses.
  Like other unrelated provisions, the revenue measures undermine the 
case to be made for the agreement. Those of us who are perfectly 
comfortable advocating free trade find ourselves defending measures 
that have nothing at all to do with the GATT. The most visible of these 
extraneous issues has been the deal struck over pioneer preferences. It 
seems inappropriate that discussions on GATT, an agreement likely to 
result in an average increase in income of $1,700 per family, would 
focus on the issue of pioneer preferences. We should have the 
opportunity to debate of pioneer preferences. We should have the 
opportunity to debate the issue of pioneer preferences on its own 
merits. It should not be settled in a manner which jeopardizes the most 
comprehensive trade agreement in history.
  All of the shortcomings of the implementing legislation aside, I will 
support passage of the Uruguay round of GATT. The benefits it offers 
American businesses, workers and consumers are simply too great to 
forego. That America's advocacy of free trade is critical to our 
continued prosperity and world leadership should be beyond dispute. It 
is my sincere hope that free trade will remain at the center of both 
parties' vision for America, and that we will demonstrate this 
commitment, as the other House did yesterday, by approving the GATT.
  Mr. LIEBERMAN. Mr. President, I rise in support of this legislation 
to overhaul the GATT, the General Agreement on Tariffs and Trade by 
implementing the Uruguay round agreements. This legislation is the end 
of a long road that began in 1986--the result of thousands, quite 
possibly millions, of hours of negotiations with our trading partners. 
After 8 years of wrangling over the agreement, I am tempted to agree 
with the observation of Lee Kuan Yew of Singapore that GATT actually 
stands for the ``general agreement to talk and talk.'' Fortunately all 
of that talk led to something that will have concrete benefits for this 
country and for the world trading system as a whole.
  The agreement reduces import duties with our major trading partners 
by an average of 40 percent. Since import duties into the United States 
are already quite low, one of the great benefits of this agreement for 
the United States is to bring down the tariff and non-tariff barriers 
that other countries have built, barriers that have made those markets 
tough for American exporters to enter. And 40 percent is just an 
average, in many cases, the drop in duties is much more dramatic. For 
instance, under the Round Agreements the duty on getting paper products 
into South Korea will go from 10.32 percent to 0 percent; the duty on 
aerospace items into Japan will go from nearly 5 percent to 0 and the 
duty on pharmaceuticals to the European Union will go from 5.89 percent 
to 0.
  Reducing the cost of exporting U.S. products has particular 
importance for my home State of Connecticut. The dramatic rise in 
exports has been one of the few bright spots in my State's economy over 
the last decade. According to the Department of Commerce, Connecticut's 
exports totaled over $10 billion in 1993. Those exports translate into 
jobs and lots of them. Commerce's Hartford District Office says that a 
conservative estimate of the number of Connecticut jobs linked either 
directly or indirectly to exports is 176,800.
  Smaller exporters are also uniquely poised to benefit from the GATT 
since the agreement simplifies and standardizes customs procedures. The 
reduction in paperwork and red tape will let small exporters spend more 
time making sales to a wider range of customers and less time trying to 
meet the paperwork requirements of each individual country. This is 
particularly important in Connecticut where over 95 percent of our 
exporters have fewer than 500 employees.
  The reduced tariffs under the Uruguay round agreements will also mean 
lower tariffs for American consumers. This cut in tariffs has been 
described as one of the largest tax cuts in history. the U.S. Treasury 
Department has conservatively estimated that the round will cut tariffs 
worldwide by $744 billion over the next 10 years. Since tariffs are 
largely passed on to consumers in the form of higher prices, consumers 
can expect to share in lower prices as a result of these tariff 
reductions.

  In the area of intellectual property this agreement is historic; it 
creates international standards for the protection and enforcement of 
intellectual property rights for the first time. A July 18 letter from 
seven former U.S. Trade Representatives rightly notes that,

       One of our greatest, strengths as a nation is our 
     creativity. Our software, pharmaceuticals, films, and sound 
     recordings are sold around the globe, and export revenues 
     from products that depend on the protection of intellectual 
     property totaled $20 billion in 1992.

  While I believe we should eventually go further in reducing trade 
losses due to piracy and counterfeiting, I am convinced that the 
agreement takes a sizable step forward in this area.
  As anyone who has followed this issue knows, a tremendous amount of 
time and energy has gone into debating the merits and pitfalls of the 
World Trade Organization [WTO]. I understood and shared some of those 
concerns about the WTO. But I have now concluded that most of those 
concerns have been addressed. At present, GATT decisions are made in 
much the same way that Parent-Teacher Associations and Kiwanis Clubs 
across this country make their decisions-by consensus. The WTO 
explicitly continues this practice of consensus. Since the U.S. is the 
world's largest trader, it is clearly in everyone's best interest to 
get our consent before any big decisions are made.
  There has been understandable anxiety expressed about the WTO's 
potential ability to overturn U.S. law. If the WTO had the power to 
overturn our laws, I would not support the legislation before us today. 
The decision to adopt, repeal or amend U.S. laws was ours under GATT 
and remains ours under the WTO. To be sure, the WTO offers more than 
lip service to GATT's dispute settlement procedures. This was done 
largely at the insistence of the United States since some of our 
trading partners had been taking advantage of our open market and 
taking advantage of us in their markets. As the Chamber of Commerce 
noted in testimony before the House Ways and Means Committee.

       The Chamber has long been concerned with the inefficient 
     workings of both United States and multilateral dispute 
     settlement processes. Far too often, companies with 
     legitimate grievances against foreign trade practices have 
     had to wait years before their cases get resolved--by which 
     time those companies could very well end up out of business.

  A Chamber survey found that unfair trade cases that went to the GATT 
took 4.6 years on average to resolve. By streamlining that process, 
organizations like the Chamber believe the WTO dispute settlement, 
procedures are significant improvements over the status quo for 
America's businesses and workers.
  Even if a WTO dispute settlement panel finds that a country has not 
lived up to its Uruguay round commitments, it is up to the countries in 
dispute to decide how to resolve that dispute. One option that is not 
available is overturning another country's laws. A defending country 
might choose to make a change in its law or it may decide to offer some 
type of compensation to the aggrieved country or the defending country 
may choose to do nothing. In this case, the aggrieved country may 
decide to suspend a trade benefit or take retaliatory action, mindful 
of the fact that the consequences may be severe if they retaliate 
against a major trading partner. As Secretary Bentsen has observed:

       The dispute settlement system is not only fair, it also 
     plays to our strengths. Due to our enormous domestic market, 
     the United States has far more trade leverage than any other 
     country in the world. The new dispute settlement regime is 
     tailor-made for us to use. Most other countries simply do not 
     have the economic clout to make retaliation against us a 
     credible option.

  I am grateful that because of concerns that have been raised about 
the WTO by Senator Dole and others the administration has developed a 
system which would allow the United States to leave the WTO if the 
organization consistently rules against the United States. This should 
bring a tremendous amount of comfort to those who are worried about the 
potential breadth and depth of the WTO's powers.
  As a former State attorney general, I've also paid particular 
attention to what impact the World Trade Organization [WTO] would have 
on State and local laws. After being contacted by the National 
Association of Attorneys General [NAAG] I in turn asked Ambassador 
Kantor to respond to concerns that had been raised about how the WTO 
would impact State and local laws. A July 15 meeting between the U.S. 
Trade Representative and the NAAG resulted in a July 27 follow-up 
letter to Ambassador Kantor from the NAAG in which the NAAG expressed 
satisfaction with USTR's efforts to accommodate their concerns. The 
implementing package before us today ensures that State governments are 
alerted to any important developments affecting State laws, allow 
States and localities to formally participate in the defense of their 
laws, and makes clear that States may maintain health, safety and 
environmental standards that are higher than those of other States or 
the Federal Government. I commend USTR for acting to address the 
legitimate concerns that were raised by the States.
  The last issue I would like to discuss is the budget waiver. Under 
Senate rules, we are charged with paying for tariff cuts for 10 years 
while the House is bound to paying for these for 5 years. Because of 
various constraints, the House Ways and Means Committee and the Senate 
Finance Committee came up with a 5-year package of tariff offsets. I am 
disappointed that we are not able to vote on a package that meets the 
10-year test. However, I will not vote against the budget waiver and 
thereby prevent this important legislation from coming to the Senate 
floor. If there is interest in ensuring that the second 5 years of this 
agreement are paid for by passing a package of spending cuts in the 
next Congress I will support that effort. During the last Congress I 
joined with a bipartisan group of Senators in offering a package of $91 
billion in spending cuts--elements of the package could pay the tariff 
cuts in the second 5 years of this agreement if need be.
  Mr. President, I hope that this chamber will approve this 
implementing legislation. The agreement stands on its own merits. In 
addition, I think a strong vote to approve this implementing 
legislation is the right message to send about the Senate's ability to 
grow our economy and protect and create jobs for American workers in a 
bipartisan way. Begun under President Reagan, continued under President 
Bush and completed under President Clinton, the agreement is proof that 
administrations from both parties can work together in the best 
interests of the United States.
  Mr. DORGAN. Mr. President, I hope that today is the day that our 
nation's economic reality finally replaces knee-jerk ideology and 
business as usual in this body. Because if it does not, the loud scream 
for change that we heard from voters three weeks ago will seem like a 
quiet autumn breeze when compared with the roar and crash of outrage 
that surely lies just ahead on the path that we are now headed.
  We are here today to discuss the most important economic decision 
this body has faced in many decades--and the least painful opportunity 
that we are likely to face for many years to change our current ruinous 
economic course.
  The cynicism of the American people is nowhere more justified than 
with the steady diet of broken promises and misleading information that 
they are fed concerning the international economic forces that now 
shape U.S. jobs, incomes, business profitability and government 
revenues.
  For some time, successive Presidents, many of my Senate colleagues, 
respected academics and the media have talked exclusively about 
expanding U.S. exports while they have ignored the far larger growth in 
U.S. imports. They have spoken of only 40 percent of the trade story. 
If we took the same blind approach in our budget debates and talked 
only about the growth of federal revenue--ignoring federal spending and 
our enormous budget deficits--would we trick the taxpayers into 
thinking that government finance was in great shape and that more of 
the same would be a terrific idea? I doubt it.
  The U.S. position in international trade has collapsed since the mid 
1970s. Our 1994 merchandise trade deficit (net exports) could reach a 
world record $160 billion. While some claim that further world trade 
liberalization would yield a $1 trillion tax cut, the reality since the 
last (Tokyo) round of trade liberalization in 1979 has been a 
cumulative U.S. merchandise deficit of $1.2 trillion; well over $1 
trillion in all goods and services; and almost $1 trillion in 
manufacturing alone.
  Although still very poorly understood by most Americans, and by many 
members of this body, global market forces and trade are no longer 
merely esoteric and glamorous marginal aspects of our economy. This 
year the U.S. will import $550 billion of foreign manufactured goods. 
That is almost half of total U.S. manufacturing Gross Domestic Product. 
We now have a net export deficit of over half a billion dollars each 
day just in manufacturing trade. We have enormous deficits in most high 
tech products of the future--including semiconductors. This has 
tremendous effects on every aspect of our economy.
  Just this week, the U.S. Department of Commerce announced our trade 
deficit is reducing real Gross Domestic Product by $120.8 billion per 
year. That figure is particularly important to today's discussion about 
the budget waiver. Chronic U.S. trade losses are a constant, enormous 
drain on federal revenues--amounting to a loss of perhaps $30 billion 
in fiscal 1994 alone. And yet many GATT proponents want to ignore the 
tidal wave of imports into the U.S.; ignore our trade deficits; and see 
only our exports. Wearing self-imposed blinders, they would vote to 
waive our hard-won budget agreements and insist that these chronic 
trade losses somehow, magicly, add to federal revenue.
  Does our experience with NAFTA and trade with Mexico support the idea 
of expanding trade world-wide through a new GATT agreement? Let me say 
that there has been much hyperbole about US-Mexico trade. The U.S. does 
continue to have a trade surplus with Mexico and our exports are 
growing. But U.S. imports from Mexico are growing faster than exports. 
So the U.S. surplus fell by 72 percent from 1992 to 1993. Since NAFTA 
went into effect, our surplus has fallen another 51 percent.
  Since NAFTA, the U.S. deficit in electronics trade with Mexico has 
doubled to $1.4 billion in just the first half of 1994, compared with 
1993. Despite the export hype from the auto industry, since NAFTA, the 
U.S. deficit with Mexico in autos and parts worsened in the first six 
months of 1994 to a deficit of $1.1 billion.
  Again, concerning global trade, while some promise hundreds of 
thousands of new trade-related U.S. jobs, the reality is no net jobs in 
internationally traded industries for over twenty years; all of the 44 
million net jobs created over the past 20 years have come in non-traded 
service sectors such as health care, local governments, retail sales 
and building maintenance. If the U.S. Commerce Department's estimate is 
correct--that each $1 billion in net exports equals 20,000 high wage 
jobs--this year's $160 billion deficit alone would eliminate over 3 
million such jobs.
  In our flexible labor market, however, the major effect of our 
chronic deficits is not always to terminate jobs, but to erode income 
as workers and businesses give up wages and profits to hold on to their 
jobs and markets. While some promise increased prosperity, the reality 
is that real U.S. income growth has slowed dramatically from more than 
4 percent per year 30 years ago to less than 1 percent today.
  This is a very important point, Mr. President, because it is often 
claimed that trade provides an enormous benefit to U.S. consumers. As I 
have indicated, some claim that this current GATT agreement would 
provide a $1 trillion tax cut. The reality, however, is that only those 
who are independently wealthy enjoy net benefits, because the 
purchasing power of workers and their families have been driven down 
sharply by trade for a generation.
  While some promise enhanced U.S. world leadership and status with 
further trade liberalization, the reality is that in order to pay for 
its massive and chronic trade deficits, the U.S. has plunged from being 
the world's leading creditor and banker by far to the world's biggest 
debtor by far. And the once strong U.S. dollar has collapsed in value; 
it bought 360 Japanese Yen in 1970, 260 in 1985, and less than 100 
today.
  This collapse in both wages and the purchasing power of the dollar is 
pricing more and more Americans out of foreign travel. In 1989, for the 
first time in the post-World War II period, the U.S. became a net host 
in world travel. Our services sector shows a trade surplus mostly 
because of the travel sector--foreign people come to the U.S., but our 
own citizens can no longer afford to travel abroad.
  The end of the cold war and today's information technologies have 
given us the same sort of primitive market condition for the global 
economy that existed for many individual national economies 100 years 
ago. The current directive for GATT and the World Trade Organization is 
not some high-minded ``world government'' but a sort of world anti-
government. Its mandate is not to seek prosperity for workers, adequate 
profits for business and a healthy environment for everyone. Instead, 
its mandate is to assure that nothing interferes with raw market 
forces, and the mandate will be carried out by a new, secretive world 
bureaucracy.
  I cannot stress enough how extremely naive and dangerous this is. We 
must not approve these agreements.
  The real issue, of course, is how to cope with a fundamentally new, 
post-Cold War global economy in which our new information technologies 
have radically transformed the way national economies work. Until we 
face the fact that it costs a company $50,000 to $100,000 a year to 
hire a first-rate softwear engineer in the U.S., but $5,000 to $10,000, 
to hire the same talent in Bangalor, India or Moscow, we are not facing 
the real world. And the unhappy consequences of avoiding this real 
world are increasing every day.
  Clearly, trade is vital in today's dynamic global economy. Yet this 
strategy now serves perversely to bring down our personal income, our 
levels of productivity, and standard of living, to lead our industries 
off-shore, to cost America millions of jobs, and, in general, to make 
this nation poorer.
  The proposed Uruguay Round agreements are more of the same trade 
policies that are already bleeding this nation. They are the wrong kind 
of trade agreements and ought to be rejected. They ought not be 
rejected in a close vote, but decisively, because they are agreements 
that hurt America.
  Mr. CRAIG. Mr. President, the GATT, or General Agreement on Tariffs 
and Trade, is the regime under which we conduct international trade.
  Here in the Senate we now have before us a very lengthy and 
complicated document referred to as the Uruguay round agreement. This 
agreement, negotiated over several administrations, will change the 
GATT significantly, in both good and bad ways.
  I supported fast-track authority, and in general support free and 
fair trade.
  I have expressed opposition to the Uruguay round agreement based 
mainly on the establishment of the World Trade Organization. Also, as a 
fiscal conservative, I have been strongly opposed to waiving the budget 
agreement which would allow passage without covering the cost for the 
full first 10 years of implementation.
  In an effort to get a broad perspective on what Idahoans were 
thinking about the Uruguay round agreement, I sent out a mailing to 
business, agriculture and local community leaders. The limited response 
was mixed, even within the business community.
  In unsolicited mail and phone calls, the overwhelming majority have 
been opposed to the World Trade Organization specifically and the 
Uruguay round agreement in general.
  GATT is expected to be generally good for agriculture. However, the 
agreement has both good and bad components depending on the commodity. 
Unfortunately the agreement is not good for some Idaho commodities such 
as dairy, wheat, and sugar beets.
  There has been a great deal of talk in the press about Senator Dole's 
efforts in an attempt to strike a compromise agreement on the WTO 
language. I commend Senator Dole for his efforts, but I am not 
satisfied with the results of negotiations with the White House.
  The President was only willing to work on legislation dealing with 
this problem in the beginning of the next Congress. The administration 
expressed a willingness to support legislation next year to establish a 
WTO dispute Settlement Review Commission.
  The Commission would consist of five Federal appellate judges, 
appointed by the President in consultation with the leadership of both 
houses and the chairman and ranking members of the Ways and Means, and 
Finance Committees.
  The Commission would then review all the final WTO dispute settlement 
reports adverse to the United States to determine whether the panel 
exceeded its authority or acted outside the scope of the agreement.
  In addition, Mr. President, should the Commission issue an 
affirmative determination a member from either the Senate or the House 
of Representatives could introduce a joint resolution for the President 
to have new dispute settlement rules negotiated, to address the 
problems identified by the Commission.
  The agreement allows for withdrawal from the WTO if their are three 
affirmative determinations within a 5-year period. However, it requires 
an act of Congress and Presidential approval.
   While the agreement is filled with good intentions, I am not 
confident that it provides the necessary safety-net to uphold U.S. 
sovereignty. The problem with this sort of arrangement is that the WTO 
dispute settlement panel may stay within the scope of authority in the 
agreement, but still pose a problem or threat to our sovereignty.
  In other words, the problem lies within the parameters that have been 
set in the GATT agreement. Therefore, the issue of sovereignty remains 
unresolved.
  I have a number of concerns about a provision in the Uruguay round 
agreement which would establish a new international entity, referred to 
as the World Trade Organization [WTO].
  The World Trade Organization is not a minor change to the structure 
of the GATT. It creates an entity that is, to me, more than an 
international organization. Rather, it is a regime with powers stronger 
than those of the United Nations.
  There is a fundamental problem with the WTO. It was created as a 
supranational structure that would strengthen the enforcement of 
trade disputes under the jurisdiction of the GATT. There have been 
previous attempts to establish a supranational body to cover trade 
relations and dispute settlements.

  Mr. President, after World War II, representatives from the United 
States and Great Britain designed a post-war economic system with three 
pillars: the World Bank, the International Monetary Fund, and the 
International Trade Organization [ITO].
  The ITO was intended to be the administrating body covering the 
General Agreement on Tariffs and Trade [GATT]. As I mentioned earlier, 
Mr. President, the U.S. Congress rejected the ITO as a threat to U.S. 
sovereignty.
  The congress took that action despite warnings from the political 
insiders that failure to join would impede economic recovery. Our 
predecessors realized that the United States and our trading partners 
did not need a bureaucracy to free trade.
  The fear of granting broad authority over our trade rules to a mostly 
foreign entity led to the repeated rejection by the Senate of ``The 
International Trade Organization'' between 1947 and 1950 and a similar 
body known as ``The Organization for Trade Cooperation'' in 1955.
  The WTO must be dropped or dramatically reformed so that there is no 
question about our sovereignty as a nation, and the sovereignty of 
state governments.
  Mr. President, when forming the United Nations, special care was 
taken to ensure that the United States would have both veto power and a 
permanent seat on the security council. However, it is apparent that no 
such effort has been made with regard to the WTO.
  In the WTO, the United States could be outvoted by a small coalition 
of nations, regardless of the overall size of their populations, their 
geographic sizes, their contribution to world trade, their funding 
contribution to the WTO, or their commitment to fair trade and 
democracy.
  The WTO would initially consist of a diverse coalition of 117 
nations. Each member nation of the WTO, including the United States, 
would have one vote in resolving trade disputes under the auspices of 
the two agreements--GATT and GATS.
  The World Trade Organization would vote on amendments and 
interpretation of GATT provisions.
  Again, Mr. President, the United States would be only one in 117 
votes. Therefore, we could easily be outvoted by third world countries 
in the WTO, as often happens in the United Nations. Another point of 
frustration is that we will be paying 20 percent of the WTO budget with 
a voice behind only one vote.
  Under the GATT as it currently exists, the United States has veto 
power and can block a panel decision by denying the necessary consensus 
to adopt a panel decision.
  Consensus is also replaced in the WTO with the following guidelines: 
A two-thirds vote to amend the WTO; a three-fourths vote to impose an 
amendment on parties and to adopt an interpretation of WTO provisions. 
Under the interstate and foreign commerce clauses of the Constitution, 
States cannot discriminate against foreign businesses, including the 
application of State tax law.
  Therefore, under the GATT currently, the failure of a State to comply 
with these provisions results in a United States court action allowing 
the parties to receive fair and open redress of their complaints.
  The dispute settlement mechanism included in the Uruguay round 
agreement, on the other hand, would require such matters involving 
State tax policy and foreign businesses to be brought before the WTO.
  It is my understanding, Mr. President, that a WTO dispute settlement 
panel can meet in secret and need not consider U.S. constitutional 
standards, nor follow the constraints of U.S. jurisprudence. This is a 
serious concern that needs clarification.
  It is also my understanding that no individual U.S. State government 
is guaranteed representation on a WTO dispute panel. And, the United 
States cannot reject a WTO dispute panel mandate without facing foreign 
retaliation and trade penalties enforced by the WTO.
  This may be a ``worst case'' scenario, but if it is a scenario that 
could occur under the WTO, then that provision in the Uruguay round 
agreement must be changed.

  Mr. President, I would like to take a moment to discuss efforts to 
resolve the problems with the Uruguay round agreement and the WTO 
language.
  Earlier this year, Senator Thurmond offered an amendment which would 
have been a nonbinding resolution, stating the sense of the Senate that 
a joint Senate-administration commission should be convened to perform 
a 90 day blue ribbon panel report on whether the WTO should be 
considered as a treaty rather than an executive agreement.
  It also requested further hearings both in Washington, DC, and in the 
field, so that the ramifications of the WTO could be fully examined and 
understood.
  Mr. President, let me be clear, this amendment did not make the GATT 
Agreement ``DOA'' [dead on arrival]. It simply reflected the importance 
of the agreement and the need to understand fully the development of a 
new international organization prior to our country's acceptance.
  In short, it would have provided the kind of real solution I was 
looking for to ensure U.S. sovereignty.
  In addition to the amendment, I joined Senator Thurmond in sending a 
letter to Senator Dole requesting the following:
  1. Mandate that the bill be fully funded.
  2. Extend, for 1 year only, fast track authority, restricted solely 
to allow the introduction of new Uruguay round implementing language.
  3. Include in the extension of fast track, requirements that the 
agreement establishing the WTO be considered as a treaty requiring a 
two-thirds approval in the Senate. The trade provisions of the Uruguay 
round would need only a simple majority in both Houses for passage.
  4. Remove the special interest provisions such as the $2 billion 
discount of Federal licensing fees to three communications companies.
  The intent of the letter was to allow ourselves the time necessary to 
resolve problems surrounding the WTO with a view to removing barriers 
from passage of the tariff reductions and other, positive components of 
the Uruguay round agreement. Unfortunately, Senator Dole was not able 
to accomplish these four goals in his discussions with the White House.
  Before concluding, Mr. President, I would also like to take a moment 
to add that I will be voting against waiving the Budget Act. The bill 
violates the fiscal year 1994 budget resolution agreement and will be 
adding $31 billion to our budget deficit.
  As a fiscal conservative and long-term supporter of the balanced 
budget amendment, I cannot support the circumvention of deficit 
reduction plans.
  Mr. President, any potential loss of U.S. sovereignty is not worth 
risking. World trade has progressed well under the current GATT system 
that is voluntary and requires unanimous consent for decisions. 
International trade has grown dramatically since the beginning of the 
GATT in 1948--the value of world trade has increased from about $60 
billion to more than $3.7 trillion. The volume of world trade has 
increased about sevenfold.
  Trade in Idaho has tripled from $752 million in 1987 to $1.9 billion 
last year. The increase for this year is anticipated to top $2 billion.
  I do not argue against the value of international trade. It is 
evident in the growth of Idaho's economy. However, I will argue that 
the WTO is not necessary for this trend to continue.
  After all, this growth has occurred under the current GATT rules, 
without the WTO. I urge my colleagues to vote against the budget waiver 
and against the GATT agreement.
  Mr. SIMON. Mr. President, I have decided to vote for ratification of 
the Uruguay Round of GATT and the budget waiver necessary under Senate 
financing rules.
  In some areas, such as worker rights and environmental protection, 
the agreement fell short of the high ideals that the United States has 
historically championed. These issues, in particular, concerned me as I 
considered this wide-ranging document. I now will look to the 
administration to pursue further multilateral agreements to achieve the 
same parity in these areas that the Uruguay round brings to goods and 
services.
  In the end, however, the agreement is about trade, and about our 
ability to compete in the world. As a leading export State, Illinois is 
a strong competitor and will be one of the first to gain from this 
agreement in new jobs and economic growth in our agricultural, 
industrial and services trade. We will see similar benefits as a nation 
from the leadership we are showing through this agreement.
  There will be costs, and I do not vote to waive our tough budget 
rules lightly. I am concerned that this not be taken as precedent for 
widespread use of dynamic scoring. But we must be practical and realize 
the economic benefits that will result in the long term from this 
agreement.
  The Uruguay round takes a further step toward a truly level playing 
field for American products in the world. I do not see the WTO as a 
threat to our sovereignty but as the common forum for global trade 
issues. If we are to set our own destiny we must remain engaged with 
the economies of the world, leading not by the bullying force of 
protectionism and veto power but by the strength of our workforce.
  The more open global marketplace of the Uruguay round will continue 
to place a premium on worker skills and productivity. I hope that the 
passage of the Uruguay round will refocus our efforts to improve our 
Nation's educational systems to ensure that our workers remain the most 
productive in the world.
  Mr. GLENN. Mr. President, I will support the legislation to implement 
the Uruguay round GATT agreement and hope that the full Senate will 
pass this measure by a substantial and bipartisan majority.
  The United States is the world's largest exporter; we have the most 
productive workforce; and we have recently regained the distinction of 
the world's most competitive economy. Exports have been critical to the 
rebound in our economy, accounting for one half of U.S. economic growth 
over the past 5 years. Further, as has been stated repeatedly, we are 
already the world's most open market. Hence, competitive goods produced 
in this country, and those who produce them, have much to gain from the 
market-opening, tariff-reducing provisions of the new GATT agreement.
  Like it or not, we are operating in a truly global economic 
environment from which we could not, and should not, withdraw. In 1965 
exports accounted for approximately 5 percent of U.S. GDP; they have 
now risen to almost 12 percent. We cannot afford to ignore the 
substantial contribution of exports to our economic well being. I have 
often said that if we did not have GATT to set the parameters for trade 
among nations, we would have to invent it, or something close to it.
  I am not sure that this GATT is worthy of all the superlatives being 
attributed to it. However, it is a solid and substantial step forward 
toward the long standing U.S. goal of freer and fairer world trade--a 
goal we have pursued since the origin of GATT in the aftermath of World 
War II.
  My State of Ohio has a substantial and growing stake in the export 
market. We are the sixth largest exporting State. Our exports have 
grown rapidly in the last several years, from $6.5 billion in 1987 to 
$19.4 billion last year. One of every seven to eight jobs in Ohio's 
manufacturing sector currently produces for the export market.
  In this negotiating round, spanning three administrations, Republican 
and Democratic, the United States made substantial progress toward 
realization of most of our major objectives. The new GATT mandates a 
reduction of worldwide tariffs by about one-third. That's a worldwide 
total of nearly $750 billion of tariffs eliminated, of which the U.S. 
share is $32 billion.
  In addition to the reduction of tariffs--traditional barriers to 
trade which earlier GATT agreements primarily focused on--the new GATT 
makes significant progress in addressing another important U.S. 
concern--non-tariff trade barriers. For example, the new agreement 
requires all GATT parties to give greater protection to intellectual 
property rights. Lax or nonexistent protection for such intellectual 
property rights has proved a very effective non-tariff barrier to 
research-and creativity-sensitive industries such as pharmaceuticals, 
electronics, software and recorded entertainment, costing U.S. 
companies billions of dollars a year.

  The new GATT agreement more fully incorporates into the GATT system 
major new sectors of world trade not previously covered or not fully 
covered; for example services, textile products, and agriculture.
  In agriculture, the new GATT agreement requires non-tariff trade 
barriers, like quotas, to be converted to tariffs and then reduced. 
Further reductions in tariffs on agricultural goods in the future will 
be made easier by the requirement to quantify these non-tariff 
barriers.
  The reduction of agricultural trade barriers in this GATT agreement 
is expected to result in increased agricultural exports by $5 to $14 
billion over the next 5 years. U.S. farmers are the most productive in 
the world, already producing substantially more than we can consume at 
home. Presently, exports take about one-third of U.S. agricultural 
production. For U.S. agriculture to prosper, it must aggressively 
pursue markets abroad. This GATT provides an important tool to support 
that effort.
  The agreement brings all parties, developing and developed, into the 
GATT system, with all the obligations and responsibilities that 
membership entails. Previously, developing countries had been free to 
opt out of certain GATT obligations.
  Many critics of the new agreement have focused on the new World Trade 
Organization and its alleged ability to overturn U.S. laws. Let me 
reiterate, as clearly as I can, what has been repeatedly stated 
throughout the debate on this question--the Congress, and only the 
Congress, makes the laws of this country. A dispute resolution panel of 
the new WTO could rule that a U.S. law is contrary to our obligations 
under the GATT, but there is nothing self-enforcing about such a 
ruling. Any decision to amend that law to conform to GATT would have to 
be a U.S. initiative approved by both Houses of Congress and signed by 
the President.
  In addition it has been suggested that somehow the provisions for 
decisionmaking and voting within the WTO create a tyranny of a majority 
who oppose U.S. interests. Let us examine the facts. The WTO agreement 
provides that the current GATT practice of decisionmaking by consensus 
will ordinarily be followed. This process of consensus decisionmaking 
is so well established within the current GATT that, it is my 
understanding there has never been a formal vote taken in GATT since 
the system was established after World War II. If consensus fails, then 
a matter may be decided by a majority of votes.
  However, major issues such as waivers of agreement obligations and 
interpretations of most agreements will require a super majority of 
three fourths. Amendments to agreements will require a two thirds 
majority, with those affecting basic rights and obligations of Members 
to take effect only for those Members that have accepted them. Further, 
amendments to certain cornerstone GATT obligations will take effect 
only if all WTO Members accept them.
  I do not expect that the WTO will become a vehicle for attacking U.S. 
trade and economic interests. Indeed, I fear a more reasonable 
prediction is that an international organization with over 100 members 
which operates by consensus will be greatly challenged to do anything 
at all. Nevertheless, if experience proves contrary to my expectation, 
the United States should not hesitate to exercise its right under the 
agreement to withdraw, with 6 months notice.
  As chairman of the Senate Governmental Affairs Committee, I would 
like to say a word about subtitle E, which makes necessary changes in 
U.S. law in order to implement agreements reached by the member nations 
of the GATT Government Procurement Code. The primary objective of the 
GATT Procurement Code is to ensure the establishment of Government 
procurement systems based on the principles of transparency, openness, 
and fairness.
  Highlights of the revised code include a threshold of $182,000 for 
waiver of buy national requirements for central Government purchases. 
U.S. minority and small business setasides would not be affected, nor 
would procurements necessary for national security. Government 
construction contracts, with a $7 million threshold, and services will 
be covered for the first time.
  In addition the GATT implementation bill would extend the U.S. 
procedure for responding to unfair Government procurement practices to 
cover failure to adequately enforce antibribery and corruption laws in 
the awarding of Government contracts.
  The agreement will not impede the use of new information management 
and other technologies to improve the efficiency of Government 
procurement systems and is consistent with recently passed Government 
procurement reform legislation.
  Is this agreement everything we could have wanted? No, it is not. Is 
there additional work to do? Yes, there is. Is this agreement a panacea 
for our economic problems? No, it isn't. Can we afford to be complacent 
about our productivity and competitiveness? No, we certainly cannot. 
However, on balance, I believe that this new GATT agreement makes a 
significant and positive contribution to furthering a freer and fairer 
system of world trade. I am convinced that it will be good for the U.S. 
economy--for producers and consumers alike. And I am confident that in 
such a freer and fairer international trading environment, American 
industry and American workers will prove very competitive.
  Mr. NUNN. Mr. President, I rise today to support the GATT enabling 
legislation. The economic benefits of this Agreement are, by now, 
familiar to everyone in this chamber. The GATT Agreement is projected 
by experts to: Increase U.S. national income by an additional $100-200 
billion a year, and increase global income by as much as $5 trillion by 
2005; reduce global tariffs by an average of one-third, producing a 
global tax cut of $750 billion over the next ten years, the largest in 
history; expand free trade rules to areas not previously covered by 
GATT, such as agriculture and services; and protect intellectual 
property rights through creation of the Agreement on Trade Related 
Intellectual Property Rights (TRIPs).
  The result of these changes will be the creation of between 300,000 
and 700,000 new American jobs and an additional $1,700 in income for a 
family of four by the year 2004.
  Beyond the new opportunities GATT offers, its passage is vital to 
ongoing American global leadership. The GATT signals our continued 
commitment to free trade and competition, and to the conviction that 
consumers--not governments--make the wisest economic decisions.
  The Uruguay round is the seventh extension of the General Agreement 
on Tariffs and Trade, and it represents the culmination of 8 years 
begun during the Reagan Administration, continued throughout the Bush 
Administration, and concluded by the Clinton Administration. The United 
States was a founding member of the GATT in 1947, and we have been 
steadfast proponents of economic development through the reduction and 
ultimate elimination of trade barriers. The U.S. has been instrumental 
in reducing global tariffs from almost 60 percent at the conclusion of 
World War II to under 4 percent when the Uruguay round is fully 
implemented.
  This strategy has worked well for America and the world. In 1987 
constant dollars, U.S. Gross Domestic Product has quadrupled from $1.3 
billion to $4.3 billion since the creation of GATT. The increase in 
trade during this same period represents a significant portion of this 
growth. Although we are no longer alone at the top, the United States 
remains the largest and most powerful economy in the world, and this 
agreement will help raise living standards in our country and around 
the world.
  Mr. President, individuals fare best when they are allowed to do what 
they do best. Economists call this concept ``comparative advantage,'' 
and it applies to nations as well as individuals. Because American 
workers are the most productive in the world, the GATT Agreement 
presents an unprecedented opportunity to utilize our advantages to 
export more goods and services overseas. Since the United States 
already has among the lowest tariffs in the world, the GATT's reduction 
of foreign tariff and non-tariff barriers can be expected to benefit 
American exports.

  I believe GATT will prove to be beneficial for Georgians. For 
example, the forest products industry in Georgia is a $13.2 billion 
business, the largest in the State. The GATT Agreement includes the 
``zero-for-zero'' agreement on wood and paper products. Paper products 
are already Georgia's leading export to Mexico and the second leading 
export to the rest of the world. As the forest products industry 
continues moving South, I expect that its exports will be a critical 
component in the region's continued economic growth.
  Mr. President, Georgians are also proud of our poultry industry. Last 
year, poultry income in Georgia reached $1.73 billion, exceeding, for 
the first time, all other crop income combined. Poultry is one of the 
best and least expensive protein sources in the world, and nobody 
produces it more efficiently than Georgians. Under GATT, poultry 
exports are projected to increase 32 percent by 2005. The developing 
countries of Asia, South America, Eastern Europe, and Africa are 
hungry, and we want to help feed them. The GATT will help those 
economies grow, and will assure that as they do, their consumers have 
the opportunity to buy Georgia poultry.
  Mr. President, the textile and apparel industry is Georgia's largest 
manufacturing sector and accounts for almost one-fifth of manufacturing 
employment in the State. I understand the industry is divided on GATT, 
but I would note that in Georgia, almost one-half of the industry is 
comprised of carpet manufacturers and suppliers, which is already 
benefiting from brisk overseas sales. According to the Department of 
Commerce, exports from the 307 ZIP code, which encompasses Georgia's 
``Carpet Crescent,'' grew 426 percent between 1987 and 1993, from 
$75.102 million to $395.37 million. So the carpet industry is clearly 
already benefiting from international markets. As for the rest of the 
textile industry, I note that the leadership of the American Textile 
Manufacturers Institute has endorsed the Agreement, and is especially 
pleased that the Breaux-Cardin rules-of-origin requirement was retained 
in the implementing legislation.
  Georgia is also a leader in the production of industrial machinery, 
chemical products, transportation and electric equipment. These four 
industries accounted for more than $1.27 billion in Georgia's 1993 
export sales in 1993, more than one-fifth of total exports. The same 
four industries grew an average of 143.65 percent between 1987 and 
1993.
  I have mentioned just a few Georgia industries by way of example, so 
let me address generally for a moment the importance of exports to 
Georgia. In 1993, Georgia shipped $6.05 billion worth of goods to the 
rest of the world. That's at 148.8 percent increase over 1987. Mr. 
President, jobs supported by merchandise exports pay above average 
wages (17 percent above average in 1990). The growth in these exports 
provided new jobs for Georgians and an increasing standard of living. 
GATT promises more of the same.

  Some of my constituents have said to me, ``How can we possibly 
compete with or sell to a country with $1 an hour wages?'' That's a 
fair question, but it assumes that labor is the only component that 
matters in trade. This is, of course, untrue. Transportation, energy, 
education, and investment--in a word, productivity, all play a vital 
role in manufacturing, and the United States offers the best total 
package. That's why BMW and Mercedes Benz will soon begin manufacturing 
automobiles in South Carolina and Alabama, and why YKK, Matsushita and 
other foreign manufacturers have made Georgia seventh in the nation in 
direct foreign investment, with 10 new manufacturing plants.
  As a practical matter, Mr. President, we have no choice but to trade 
with the rest of the world. The United States represents four percent 
of the world's population and 22 percent of the world's economy. But 
the United States, Western Europe and Japan are mature economies and 
their growth potential is limited. If we close the door to the fast-
growing developing world, we are resigning ourselves to a declining 
standard of living; and if we don't capitalize on opportunities in the 
developing world, someone else will. But we cannot have it both ways. 
We cannot demand that other countries open the door to the U.S. while 
we shut the door on them.
  Mr. President, a final word about the World Trade Organization (WTO). 
I know some of my constituents are concerned about the implications of 
the WTO's Dispute Settlement Board on U.S. sovereignty. I have studied 
this issue closely, and based on my review, I do not believe it will 
infringe on our sovereignty. The WTO cannot change U.S. law; only 
Congress can. In any event, the ultimate recourse in any GATT dispute 
is for the United States is to withdraw from GATT. I would certainly 
support exercising that option if I though the GATT infringed upon our 
sovereignty. I believe this Agreement protects U.S. interests while 
increasing economic opportunities at home and abroad.
  Mr. KOHL. Mr. President, I rise today in support of the GATT 
implementing legislation. This is not perfect legislation or a perfect 
trade agreement. But we are not here today to vote on a perfect trade 
agreement. We are here to decide whether Wisconsin and the United 
States will be part of the world economic market.
  Both proponents and opponents of GATT are trying to answer that 
question using the same criteria. What vote will lead to more jobs, 
more economic prosperity and a better standard of living for the most 
Americans?
  For the people in my home State of Wisconsin, GATT and entrance into 
a more open world market is the answer. We can try to preserve our 
current standard of living by shutting out the rest of the world--and 
that might work to preserve a few jobs in a few industries for a short 
period of time. Or we can try to improve our future standard of living 
by using the GATT to enter new world markets--and that gives us an 
opportunity to create new jobs in many industries for the foreseeable 
future. Choosing GATT is choosing the chance for a richer, better 
future for our children.
  The U.S. economy is increasingly dependant on the international 
economy. In 1992, according to the Department of Commerce, over 7 
million workers in the U.S. owed their jobs to merchandise exports and 
an additional 3.5 million U.S. workers owed their jobs to U.S. service 
exports. In 1993 in Wisconsin, exports totaled $5.8 billion, almost 
double the level of exports in 1987. The days are gone in which the 
rest of the world needed our business more than we needed theirs. Trade 
is responsible for millions of current U.S. jobs and thousands of 
Wisconsin jobs. It has created millions of U.S. jobs and thousands of 
Wisconsin jobs. And expanding trade will create millions more.
  The reductions in tariffs and trade barriers will stimulate economic 
growth and enhance export opportunities for American business. One 
study by the Economic Strategy Institute concludes that the agreement 
would increase annual U.S. income between $100 billion and $200 billion 
over ten years. It is also estimated that this agreement will generate 
from 300,000 to 700,000 new jobs by 2004. American consumers will 
benefit from lower prices and increased competition, which will lead to 
higher quality, competitively-priced goods and services. Wisconsin's 
leading manufactured exports include industrial machinery, scientific 
and measuring instruments, and electric and electronic equipment. These 
three industries together accounted for nearly 60 percent of the 
state's total exports in 1993. Under this agreement, tariffs on these 
products will be reduced by over 50 percent.
  For all of these reasons, I believe moving toward free trade and U.S. 
participation in the world market is the best choice, and that is why I 
support GATT. But that does not mean I believe GATT is perfect. There 
are some provisions of this massive agreement with which I take issue.
  First of all, passing GATT requires waiving the Budget Act--something 
I do not take lightly. The lower tariffs in GATT will lead to a loss of 
tariff revenue for the United States of $10 billion over the next five 
years and $26.6 billion over the next ten years. When GATT was first 
released, I and several other Senators wrote to the President asking 
him to develop implementing legislation that fully offset these revenue 
losses. The Administration did subsequently develop a financing package 
that is included in the implementing legislation before us. It reduces 
the revenue loss to $1.7 billion in the first five years and $12 
billion over ten years.
  I would have preferred a full offset; I believe that is the more 
responsible course. But I also believe that GATT will generate new 
economic activity that will offset the revenue losses many times over. 
It is proper that we do not count such revenue in our budget figures 
because it is based on assumptions about economic growth that are not 
100 percent certain. However, it is also proper that we waive the 
budget rules to pass legislation that almost certainly will lead to a 
healthier economy and a stronger government balance sheet. As Senator 
Domenici pointed out earlier today, we allow our budget rules to be 
waived by vote of the Senate exactly because there are some measures--
like GATT--that have positive economic and budgetary effects which are 
not reflected by our current, conservative accounting.
  Second, I have heard from some who are concerned about the effect 
this agreement will have on the dairy industry, one of the largest 
industries in my state. However, it must be noted that, in general, 
GATT is good for agriculture. U.S. farmers can expect to gain new 
export markets for products from feed grains to meat products to fruits 
to vegetables.
  However, it is no secret that dairy farmers are unhappy with this 
Agreement. They are correct that U.S. negotiators did not place a high 
enough priority on gaining new markets for U.S. dairy products. And the 
mixed signals sent from U.S. dairy representatives in Geneva during the 
GATT negotiations made it difficult for negotiators to set a clear 
objective for dairy trade.
  The question is, however, what do you do with that information? 
Oppose the Agreement and all of its other benefits or attempt to bring 
about appropriate changes in the GATT for dairy farmers. I have chosen 
the latter course. I have worked with the Administration and our 
trading partners to do everything possible to make this Agreement 
better for the dairy farmers of this nation.
  One of the biggest concerns of dairy farmers about this GATT 
Agreement has been the large increases in cheddar cheese imports from 
New Zealand and Australia. Since cheddar cheese acts as a commodity 
cheese in this nation, increased imports of cheddar cheese have a 
direct effect on milk prices paid to U.S. farmers. And milk prices are 
already too low.
  To soften the blow to U.S. dairy farmers, several of my colleagues 
and I were able to work with Australia to achieve a mutually beneficial 
agreement to adjust the type of cheese entering U.S. markets from that 
nation. As a result of these efforts, Australia has agreed to swap half 
of their cheddar cheese allocation for an equal allocation of specialty 
cheeses, which do not directly effect milk prices.
  Another priority for U.S. dairy trade has been access to the Canadian 
market. While Canada has agreed to remove their import quotas on dairy 
products imports, they have replaced them with high tariffs, in direct 
conflict with the NAFTA and U.S.-Canada Free Trade Agreement. Although 
this matter is still unresolved, Ambassador Kantor has assured me that 
he will continue negotiation with Canada on this matter, and bring 
formal NAFTA dispute action against Canada if necessary.
  And finally, I have listened with concern to those who have argued 
that the World Trade Organization established by this Agreement will 
lead to weakening of the environmental laws of the United States. 
Clearly, that would be counter to the purpose of GATT, which is to 
further unite trading partners through reduced economic barriers. I 
view a general trend of increased environmental standards worldwide to 
be an appropriate corollary to the increased economic trade envisioned 
by this GATT Agreement. As a nation's standard of living increases, so 
also does that nation's ability to devote resources to environmental 
goals.
  Contrary to some accounts, the World Trade Organization has no 
sovereignty over U.S. environmental laws. The WTO does, however, have 
the authority to declare U.S. environmental laws GATT illegal, but only 
if they are not scientifically based. If, as some suggest, the WTO 
consistently rejects U.S. environmental laws as GATT illegal, the 
United States retains the full right to withdraw from that body. But 
for the United States to reject this GATT Agreement, would be to 
discard our ability to be a force for environmental change worldwide. 
It is my hope that the United States will be able to join with European 
nations in using the power of the WTO to persuade other nations to 
adopt more environmentally progressive laws.
  Despite these reservations, I believe that the legislation before us 
today is exactly the type of legislation we should hope to pass in the 
104th Congress--bipartisan, practical, good for the nation as a whole. 
Yes, it is full of compromises. Yes, I would have drafted some parts 
differently. But, overall, GATT moves Wisconsin this nation into the 
world market, into opportunities for a better standard of living, into 
a prosperous and healthy future. It does so because it is not a 
political document--it is a practical attempt to provide the most hope 
and opportunity for the most Americans. That is good legislation. And 
that is legislation worthy of our support.
  Mr. KENNEDY. Mr. President, I support the General Agreement on 
Tariffs and Trade. A year ago, there was extensive debate in Congress 
and the Nation over whether the United States should enter into the 
North American Free Trade Agreement with Canada and Mexico, our two 
closest neighbors to the North and South. Today, the Senate will vote 
on whether to enact legislation implementing a much more far-reaching 
effort to reduce barriers to trade among more than a hundred nations 
throughout the world.
  As with NAFTA last year, GATT has provoked strong feelings on both 
sides of the issue, especially with respect to its impact on the 
workforce. In Massachusetts, I held a hearing and heard from a number 
of witnesses who are deeply concerned that the long-term consequences 
of GATT will be further pain and dislocation for working men and women 
who have already been hard hit by the massive structural changes that 
have transformed our economy over the last two decades.
  There is one fundamental principle we can all agree on. The success 
of our trade policies must be measured by the degree to which they 
improve the living standards of the people and advance the well-being 
of our society.
  It is clear that many families have yet to experience the sense of 
enhanced economic security that should come with an expanding economy. 
Despite significant progress in the last 2 years in making up the 
ground lost to the recession, reducing unemployment, creating new jobs, 
holding inflation down and cutting the Federal deficit, there continues 
to be a pervasive sense of unease among large numbers of working 
families.
  Many of them have been affected by the dislocations accompanying this 
period of economic change--if not directly, then through the 
experiences of relatives, neighbors, or friends. The prospect of 
expanded trade and increased international competition in these 
difficult times often means greater anxiety among these families for 
their own jobs and for their families' futures.
  One answer to this increasing global competition is more investment 
in technology, infrastructure, and education and training. America must 
not engage in a ``race to the bottom,'' where we are obliged to lower 
our living standards to those of Third World nations. Instead, we must 
compete on productivity, and that means investment, public and private.
  I hope that many of my colleagues will be mindful of these needs. It 
isn't enough just to expand trade. We must provide necessary 
investments, while keeping our fiscal house in order. We must do more 
to alleviate the fears that many working men and women now have, and 
that have made passage of this agreement so controversial.
  In recent years, we have been working hard in Massachusetts to 
overcome the effects of the recession and to create new jobs and better 
jobs for our workers. We have made substantial progress, especially in 
areas such as telecommunications equipment, software, biotechnology, 
construction, and other industries. Our primary goal is the retention 
and creation of good jobs and good wages.
  In Massachusetts, we are fortunate to have a number of industrial 
sectors that will continue to grow and expand, as long as we continue 
to focus on their needs, and invest in them. We must provide an 
educated and skilled work-force, a quality living environment, and the 
infrastructure necessary to keep our State economy strong. To do so, we 
must maintain the competitive advantage that has made our State a place 
where we can create good jobs for our workers.
  I have supported the administration's efforts to negotiate GATT, 
because I believe our economic strength depends on expanded trade. In 
Massachusetts alone, exports increased almost 50 percent during the 
depth of the recent recession. While many industrial sectors across the 
State and country were downsizing, those that were able to take 
advantage of export opportunities created 60,000 new jobs and more than 
$3 billion in new economic activity.
  GATT will help many sectors of the economy to grow even more rapidly. 
Its broad provisions reducing tariff and nontariff barriers for large 
numbers of products will open foreign markets at long last to countless 
U.S. enterprises. Barriers that have long denied U.S. access to markets 
in Europe, Asia, and other parts of the world will be removed.

  The machine tool industry, which was founded in New England and has 
recently begun to rebound, will have improved access to new world 
markets. Our medical equipment, computer, and telecommunications 
industries will be better able to compete in international markets.
  GATT also increases the protections for intellectual property and 
helps to combat intellectual piracy, a significant issue for high-
technology industries like computer software. More open access to 
foreign government procurement contracts will allow U.S. industries to 
compete for new business across the globe.
  Our financial services sector did not gain the export opportunities 
that we had hoped for, but the foundation for future negotiations has 
been laid.
  Overall, expanded world trade will help the economies of 
Massachusetts and America. But no one disputes that there will be 
losers. The textile and apparel industry, for example, will be faced 
with the phase out of the Multi-Fiber Agreement, which sets the quotas 
that have allowed the industry to remain competitive over the years.
  We should provide effective assistance to such industries, helping 
them to use more productive technologies and have a well-trained work 
force. We should take some of the benefits from expanded trade, and use 
them to assist those industries like textiles that have already been 
hurt by global competition, and that will be harmed even more by GATT.
  But the consequences of failing to pass GATT are much worse than the 
damage that will be done by approving it. If Congress fails to pass 
this agreement, it will weaken America's position in the world economy. 
It will encourage other nations to continue with their own 
protectionism and unfair trading practices that have blocked many 
American industries from fair competition.
  Like many of my colleagues, I wish that this agreement had higher 
standards for labor and better environmental protections. But rejection 
of GATT now will not advance these other worthwhile goals. If GATT 
fails, the world trading system will be set back for years, if not 
decades. In such a contentious atmosphere, it will be even more 
difficult to make progress on the labor and environmental issues that 
we care deeply about and that should be part of future trade 
negotiations.
  Additional concerns over GATT involve the World Trade Organization, 
U.S. sovereignty, and our relations with other nations. In fact, 
though, we will be in at least as strong a position under the new 
organization as we were prior to GATT.
  A more effective dispute resolution mechanism was one of America's 
principal negotiating objectives under GATT. Under current procedures, 
when the United States won favorable rulings against other nations' 
unfair trade practices--which was the case more often than not--we had 
no effective means of implementing those rulings.
  Senator Dole and the administration have worked well together to 
improve GATT on issues relating to the WTO. If the WTO truly threatens 
U.S. sovereignty, we can withdraw from the agreement, and Congress will 
now have an enhanced role in facilitating that withdrawal. I do not 
anticipate such a scenario taking place, but the ability of the United 
States to withdraw in these ways should reassure some of the critics.
  For all of these reasons, and recognizing the agreement's flaws, I 
urge the Senate to support GATT. The real challenge we face will be to 
see that GATT fulfills our hopes, not our fears. Above all, we must 
help the industries and workers hurt by this expansion of trade, and I 
intend to do all I can in the months and years ahead to see that this 
challenge is fully met.
  Mr. McCONNELL. Mr. President, today the Senate will vote on history's 
most ambitious world trade agreement. Since World War II, the world 
economy has become increasingly interdependent and trade has played an 
increasing role in political affairs. For the past seven years and 
through three administrations, two Republican and one Democratic, the 
U.S. has worked to expand free trade in the Uruguay round. Studies 
indicate that the U.S. will receive a boost of over $100 billion 
annually through expanded trade. I support the agreement, because it 
mandates not just free trade, but fair trade for U.S. goods.
  Mr. President, this agreement has been expanded to include coverage 
for a number of new areas such as the trade in services, agriculture 
and protection from piracy of intellectual property. This agreement 
will also implement the largest tax cut in history. The across-the-
board reduction in tariff, subsidy, and quota levels will amount to a 
$744 billion tax cut worldwide. ``Tariff'' is a fancy name for ``tax'' 
and these taxes are applied to both consumers and U.S. exports. These 
added costs put U.S. exports at a distinct disadvantage.
  Since GATT's inception in 1948, eight trade rounds have been 
completed that have established rules of trade reducing tariff and non-
tariff barriers. As a result, world trade has steadily expanded.
  In fact, between 1965 and 1990 merchandise trade has increased by a 
whopping 439 percent. Currently, the U.S. is the leading world 
exporter, with 11.6 percent of our Gross Domestic Product coming from 
exports. As this figure increases, so will higher paying export-related 
jobs.
  This agreement achieves four major objectives. First, foreign markets 
will open to U.S. producers through the reduction in tariff and non-
tariff barriers. I am especially pleased in this round we were able to 
crack the protectionist foreign agriculture markets which to this point 
have heavily subsidized their own agricultural interests.
  Second, this agreement strengthens the procedures for dealing with 
unfair trade. The new dispute settlement procedures will ensure that 
nations engaged in unfair trade will be required to come to the table 
in good faith to resolve trade disputes. This will eliminate the delays 
and stalling tactics which foreign countries have used in blocking U.S. 
entry into their markets.
  Mr. President, the third objective this agreement achieves presents 
the best opportunity for the U.S. to expand trade. This allows for the 
establishment of rules of trade in services and the protection of 
intellectual property.
  This is the first multi-lateral and enforceable agreement to include 
either provision. This is a tremendous achievement for the United 
States. In 1991, services accounted for 62 percent of U.S. GDP, 
employing 57 percent of U.S. workers. Currently, the U.S. maintains a 
$55 billion surplus in this area.
  With regard to intellectual property, U.S. corporations have lost 
billions because there have been no trade protection against the piracy 
of intellectual property. In 1987, a survey by the International Trade 
Commission estimated that U.S. companies lose $23 billion annually due 
to piracy of intellectual property. With the U.S. the undeniable leader 
in intellectual property, such protection is critical to ensure future 
innovation and prosperity.
  A letter I received from the Software Publishing Association states 
that this new trade protection will help American software producers 
retain nearly $7.5 billion annually. Mr. President, this figure 
represents an astounding 48 percent of the software market share.
  Lastly, this agreement will reduce federal subsidies and instill some 
discipline in international agriculture trade. For too long, U.S. 
farmers have fought a losing battle to gain access to European and 
Asian agriculture markets.
  Prohibitive subsides and tariff barriers have stymied the growth of 
our highly productive agriculture industry. Without a doubt, exports 
are essential to continued market expansion. The U.S. Department of 
Agriculture estimates that the Uruguay Round Agreement will increase 
exports by $5 to $14 billion over the next five years.
  What is more important for future agricultural trade expansion is the 
discipline that the agreement applies to countries who might otherwise 
choose to close markets and subsidize exports. This agreement has 
important consequences for our large trading partners that are 
currently outside of the GATT such as: China, Taiwan, and the nations 
of the former Soviet Union.
  This agreement enables countries to use GATT rules to challenge 
unjustified health-related regulations that restrict trade, while 
protecting every country's right to ensure food safety and animal and 
plant health through policies based on scientific evidence. I am 
confident that U.S. laws will prevail and set a higher standard for our 
trading partners to meet. That is why the American Farm Bureau and the 
Kentucky Farm Bureau both proudly support GATT.
  I have heard from a number of organizations who have attempted to 
deflect the debate away from the importance of free and fair trade to 
other issues. Mr. President, we must not lose sight of what this 
agreement is about. It is about expanding trade and providing access to 
other markets that currently maintain barriers that deter the sale of 
U.S. products. This will ensure our own economy will grow and create 
new, higher-paying jobs.
  Mr. President, I am not aware of any respected analysis which 
estimates that this agreement would have an overall negative impact on 
employment on the economy as a whole. Instead, GATT will reduce world 
tariff rates by 34 percent on average, and entirely eliminate tariffs 
in key exports such as pharmaceuticals, toys, medical equipment and 
heavy industrial machinery.
  This agreement will cut tariffs world-wide by $744 billion, and the 
cuts borne by the U.S. represents only a small fraction of this total. 
It is widely accepted by economists that a reduction in trade barriers 
will stimulate trade.
  The most recent and telling free trade success was the NAFTA 
agreement implemented at the beginning of this year. NAFTA has sparked 
the creation of more than 100,000 new jobs this year alone, and 
contributed to a 21 percent increase in trade with Mexico in the first 
nine months of the agreement. U.S. corporations are selling everything 
from apples to X-rays because of NAFTA.
  NAFTA, though it has proven to be a stunning success, pales in 
comparison to the GATT which includes over one hundred countries. The 
Department of Treasury estimates GATT will contribute to the creation 
of an estimated 500,000 new U.S. jobs and over $100 billion in 
increased economic activity per year. This economic boost will more 
than offset the revenue lost in the last five years of this agreement.
  There are some who claim that this agreement will serve our 
sovereignty up to some higher world government. This is absolutely not 
true. The World Trade Organization is a framework for resolving trade 
disputes. The decision issued by a dispute resolution panel is not 
self-enforcing and can't override U.S. domestic law. Only the U.S. 
Congress can change U.S. law. In fact. Section 102 of the Agreement 
states that ``no provision of any of the Uruguay Round Agreement, nor 
the application of any such provision to any person or circumstance, 
that is inconsistent with any law of the United States shall have 
effect.'' As a Senator, I have sworn to uphold the Constitution and I 
am confident this agreement does not pose any threat to U.S. 
sovereignty.
  Further, I am hardly alone in that view. The distinguished Judge 
Robert Bork, as well as the highly conservative Heritage Foundation, 
have both concluded the same thing.
  This agreement, however, will establish the most effective and 
binding dispute settlement procedures to ensure compliance and fair 
trade. These procedures give the U.S. a stronger hand in bringing 
unfair trading nations into arbitration and settlement in a timely 
fashion. More importantly, it eliminates the ability of nations to veto 
their penalty for unfair trade practices under the current GATT.
  If, however, the gloom and doom scenarios of protectionists do come 
true, the U.S. has the opportunity to withdraw from this executive 
agreement and continue under the old regime.
  As the leading free trade nation, the U.S. stands to benefit greatly 
from this dispute resolution framework. Instead of looking at the glass 
half empty, as many protectionist have, we can be confident that the 
U.S. will have a mechanism for opening various unfairly protected 
markets. If a nation is found guilty of unfair trading, the U.S. has 
every opportunity to take unilateral action to even the playing field. 
Obviously, losing a foothold in our market would be a significant 
deterrent for any nation or industry.
  Mr. President, I have wrestled with this decision for some time. I am 
disappointed that President Clinton did not remain committed to the 
passage of this agreement after it was signed early this year. The 
``lame duck'' nature of this special session has fueled the mistrust of 
the American people. Unfortunately, we are left with zero options. 
Without the fast-track protection, which expires at the end of this 
year, this agreement would be decorated like a christmas tree, with 
special interests each putting their ornaments on it until it collapses 
from the weight. This would harken back to the Smoot-Hawley Tariff bill 
that led to the most proetectionist and failed trade regime the world 
has ever seen.
  Despite receiving the endorsement of Constitutional scholars, 
academics, trade experts, consumer organizations, farm groups, 
employees, business and state and local officials, we have had to fend 
off assaults from the opponents of free trade and avowed 
protectionists. for their own reasons, the opponents have a strong 
desire to continue under the old system of high tariffs and record U.S. 
trade deficits.
  Mr. President, I find it difficult to understand why the opponents of 
this agreement want to continue to pit U.S. exporters against our 
trading partners with one hand tied behind our back.
  I too believe we need to reduce our trade deficit, but the only way 
that can happen is to expand our markets and sell more abroad. I find 
it incredible that the GATT's opponents believe our trade deficit will 
be reduced by the defeat of this bill.
  For the long term benefit of the United States, we must focus on the 
expansion and protection of our exports, which this agreement ensures. 
This agreement will tear down longstanding trade barriers and create 
new markets for U.S. goods. We must not forego this opportunity to 
expand exports and create new jobs. I urge my colleagues to support a 
winner, support GATT, and allow America to compete freely and fairly on 
a more level playing field of trade.
  With a new century only six years away, we must not turn the clock 
back now. A great future lies ahead for us, and GATT will help make us 
ready for it.
  The PRESIDING OFFICER. Who yields time?
  Mr. MOYNIHAN. I yield the remainder of our time to the distinguished 
majority leader.
  Mr. MITCHELL. Madam President, Members of the Senate, the Senate will 
shortly vote on the Uruguay round of the General Agreement on Tariffs 
and Trade. It is one of the most important votes of this Congress for 
the future prosperity of our Nation.
  This trade agreement, if approved, will bring enormous benefits to 
our economy, our businesses, our workers.
  Expanding international trade has been the engine of American 
prosperity since the end of the Second World War. It has been the focus 
of all of our past international trade policies.
  Immediately after the war, the United States financed the 
reconstruction of an international order based on stable, prosperous 
democracies because we saw that our Nation's security would be best 
preserved in such a world.
  We succeeded to an unprecedented degree. The Marshall plan rebuilt 
European industry and fired the engines of the so-called German 
economic miracle.
  In Japan, the introduction of democratic political institutions went 
hand in hand with the grant of favorable trade access for Japan and 
other devastated nations in the Pacific.
  During that period, we undertook the defense of the free world in the 
interests of Western security. While our trading partners rebuilt their 
economies, we protected them against aggression.
  But as our trading partners became our trading competitors, they 
began to protect not only their favored, relatively free access to our 
markets, but they began to protect their own markets against others, 
including ourselves.
  We have not insisted with sufficient vigor that our trading 
competitors carry their own defense weight, but we will. We have asked 
them to open their markets to our goods. The agreement now before us is 
a huge step in that direction.
  Immediately following the Second World War, the American economy 
dominated the world. We had little competition. American production, as 
a percentage of the world's economic production, was 37 percent. The 
crippled economies of postwar Europe and Japan were struggling to get 
on their feet. Former colonies in Pacific Asia and South Asia were just 
beginning the process of economic development.
  In the intervening 40 years, our economic growth has been solid. So 
has the growth of our trading partners and our competitors.
  Former colonies in Asia are growing faster than are the mature 
economies. The American economy has kept pace, but in such a changed 
world America's share of a hugely enlarged global economy was bound to 
be smaller relative to others, as it is.
  Today, the output of the 260 million people of the United States is 
about 22 percent of the combined output of the other 5.5 billion people 
in the world.
  A lower relative share of world production means that we have to 
compete both for developed and emerging markets throughout the world. 
We cannot be satisfied any longer with simply selling American products 
in America. This agreement will give us the tools to compete on a more 
level playing field, to compete against competition, not against 
artificial trade barriers.
  The economic miracle of the postwar world is that with the expansion 
of international trade, every participating nation's economy has grown. 
Human well-being has reached more people at higher levels than ever 
before in history. The leading beneficiary of that trend has been the 
United States.
  The future of our economy depends on our ability to respond to the 
demands of the global marketplace. This agreement will define the 
American role in the global economy and in world affairs well into the 
21st century.
  With the passage of this agreement, the Senate will affirm the 
leadership role of the United States around the world. Rejection would 
send a far different signal: That the United States fears the 
challenges of the post-cold war global economy. Rejection of this 
agreement would be a signal of American weakness.
  We should not turn our backs on opportunities in new and growing 
markets around the world. Our own economic security depends on our 
willingness and our skill at adapting to a rapidly changing global 
economy. American companies have adapted to the competitive 
international marketplace by increasing productivity through new 
manufacturing techniques and by streamlining production. The American 
worker is the most productive worker in the world.
  Let me repeat that for those who fear competition with other nations: 
The American worker is the most productive worker in the world. But the 
price of these productivity increases has often been the reduction of a 
company's work force.
  Automation and improved computer technologies have made many jobs 
vanish as silicon chips now perform functions that once were performed 
by human beings.
  It is no wonder that many working Americans fear the fallout of 
economic change. They have a right to be wary, for too often in the 
past swift economic change has disrupted the lives of families and 
whole communities, and too often, our Government has responded slowly, 
begrudgingly, inadequately.
  The government which wants to expand trade must recognize that it has 
a reciprocal responsibility to the people most at risk from the effects 
of trade expansion.
  Those who favor the trade agreement, as I do, must acknowledge and 
accept the responsibility to remember that there is more than one step 
in our progress toward a more prosperous nation and world.
  The first step is opening markets and freeing trade.
  But the second and equally important step is to make certain that our 
people do not disproportionately pay the costs that are part of every 
significant economic change.
  We must work together to prepare the U.S. economy for the challenges 
of the 21st century. Our workers must be educated and trained so the 
industries of the future will invest in this country and create new 
jobs here. We must reduce the burden that health care costs place on 
American businesses, which reduce their global competitiveness.
  Like every one of my colleagues, every single Member of this Senate, 
I have seen first hand the dislocations of families and communities 
that occur when a production facility is moved offshore, or competition 
from lower wage countries gives our consumers a better bargain. The 
displaced workers should not be forced to pay the price of change.
  But we must recognize also the benefits of change and harness them to 
our advantage. In my home State of Maine, companies and their workers 
have greatly benefited from expanded global trade.
  In 1993, Maine exported more than $1 billion of merchandise to 
foreign markets, almost 10 percent more than in the previous year. 
Maine's sales to foreign markets grew more than three times the rate of 
the domestic economy.
  Our economic future depends on expanding international trade though 
lower tariff and eliminating nontariff barriers. So does the economic 
future of every other State in the Nation.
  The North American Free-Trade Agreement, passed only last November, 
has already produced tangible economic benefits in Maine.
  In the first quarter of 1994, Maine's exports to Mexico increased 141 
percent over the previous first quarter. The agreement before us today 
will have an even greater positive impact, a much greater positive 
impact, on economic growth on Maine and the Nation than did the North 
American Free-Trade Agreement.
  For example, this agreement will eliminate tariffs on paper and paper 
products in European and Asian markets. The American paper industry has 
estimated that this tariff elimination alone will produce a $2 billion 
increase every year in American exports of paper and paper products.
  The agreement lowers tariffs now levied against other Maine product, 
including semiconductors, electronic components, wood and wood 
products, blueberries and leather products. When those tariffs are cut, 
Maine-produced goods will be less costly and more attractive to foreign 
buyers, and Maine's exports will have a chance to grow. That is true 
for the products of virtually every State in the Nation.
  In addition to the tariff cuts, the agreement will establish new 
rules to help eliminate foreign import barriers based on unjustified or 
unreasonable local regulations. In the past, to cite one example, 
foreign countries have restricted imports of American potatoes from 
Maine and other States, and fish products through the use of unfair 
sanitary and phytosanitary standards.
  Under this agreement such standards will have to be based on science. 
Since our regulations are now based on science and others are not, we 
can only benefit from compelling other nations to adhere to the high 
standards which we already observe. The agreement will not prevent the 
United States or any other nation from adopting more stringent 
standards but it will curtail their use as tools of protectionism.
  These are only a few of the benefits that this agreement will produce 
for the State of Maine and the Nation.
  Here in the debate and across the country opponents of this agreement 
have attacked it because it will not immediately produce impeccable 
fairness in every aspect of every trade exchange among an international 
community whose member nations vary enormously in wealth, resources, 
manpower, and laws.
  It has been attacked because the agreement itself does not eliminate 
child labor practices in foreign nations. It has been attacked because 
the United States currently has a balance of trade deficit, and the 
agreement cannot guarantee that the U.S. trade deficit will be 
eliminated in the future.
  Of course, the reality is that the United States could never reach a 
multilateral agreement that would by itself solve all of these 
problems. But this world's nations, with all their differences in 
wealth, resources and laws, are the only trading partners we have.
  We do not trade with Mars. We do not trade with the Moon. We do not 
trade with people and countries made in heaven. We trade with the 
countries which exist on this Earth. And so we must negotiate with them 
as we must trade with them.
  No agreement of this scope could be perfect. This one is not. It 
leaves open the potential of trade disputes in the future. That 
potential can never be eliminated. Foreign agriculture subsidies were 
not completely eliminated under this agreement, although they are 
substantially reduced. The transition period for imposing the 
intellectual property rules on developing nations is disappointingly 
too long. And the concerns of the U.S. audio-visual industry were not 
properly addressed in the services agreement.
  But we should not measure this trade agreement against a perfect and 
unrealizable ideal. We must weigh it against the current world trading 
system, and the current rules. And by that comparison, this agreement 
is a very good deal for America, and a very great improvement on the 
current system.
  Mr. President, I want to address that aspect of the debate which has 
generated the most misinformation; that is, the role of the World Trade 
Organization and its impact on the American sovereignty.
  Let me make it clear and unmistakable. The Uruguay round agreement 
will not undermine the U.S. sovereignty; will not undermine U.S. 
sovereignty. The power to make and change American law will remain 
where it is right now, right here with the U.S. Congress.
  And section 102 of the implementing legislation plainly states, and I 
quote its exact words: ``No provision of any of the Uruguay round 
agreements, nor the application of any such provision to any person or 
circumstance, that is inconsistent with any law of the United States 
shall have effect.''
  No provision, nor its application, that is inconsistent with any law 
of the United States, shall have any effect.
  That is a direct, unmistakable response to the allegations of a loss 
of sovereignty.
  Neither the World Trade Organization nor any dispute settlement panel 
will have any authority to enjoin the enforcement of any United States 
law or any State law, or to impose any monetary sanctions against the 
United States. The dispute settlement panel will have the power only to 
recommend that a member nation bring its laws into conformity with its 
international obligations.
  But that does not mean we must change our laws. If a dispute 
settlement panel rules against us and says that a U.S. law is 
inconsistent with GATT, we may offer to the complaining country 
compensation, or we may make another agreement.
  The decision-making rules of the World Trade Organization are 
protective of American interests. For over 30 years, the GATT has 
operated by consensus--in which any member nation can block action and 
exercise an effective veto. There has not been a GATT wide vote on any 
trade policy issue since 1959.
  Article Nine of the Uruguay round agreement specifically codifies 
this past GATT practice of operating by consensus.
  If World Trade Organization members attempt to change the Uruguay 
round agreement in the future, the rules provide that certain important 
provisions, such as the most-favored-nation obligations, decisionmaking 
rules, and the amendment rule, can be changed only--I repeat--only--
when all members of the World Trade Organization agree to the change. 
That means that if any amendment is against American interests, we can 
block it.
  To allay concerns about the World Trade Organization, the President 
has consulted with Secretary of the Treasury Bentsen, U.S. Trade 
Representative Kantor, and Senator Dole. They have reached agreement, 
an agreement which will create an exclusively American commission of 
five retired judges who will review any adverse decision made by a 
World Trade Organization dispute settlement panel. This American 
commission will determine if such a panel decision is outside the scope 
of the trade agreement or exceeds the panel's authority.
  If the review commission makes three adverse determinations within 5 
years, Congress will have the authority to approve a joint resolution 
for U.S. withdrawal from the World Trade Organization.
  The legislation will provide another procedure to withdraw from the 
World Trade Organization. There is existing authority in the agreement 
that allows any nation, including ours, to unilaterally withdraw from 
the World Trade Organization after giving 6 months' notice. So let us 
put it to rest once and for all. The World Trade Organization will not 
undermine American sovereignty; it will enhance our economic interests.
  On the budget issue--and that is the first vote we will have--we 
should not be mistaken about the impact of this agreement. If it is 
implemented, the agreement will lower, not increase, the Federal budget 
deficit. The increased economic growth will generate more revenue for 
the Treasury than it will lose from the tariff reductions.
  The congressional budget rules are important, but we must now waive 
those rules in this case because the agreement serves both the national 
interests and promotes the goal of deficit reduction.
  The potential dangers of this agreement have been much discussed and, 
in my respectful view, much exaggerated. Meantime, the potential 
benefits are much more real and realistically based.
  Over time this agreement will reduce average merchandise tariffs by 
more than one-third. In the world's developed economies, average 
tariffs would decrease from 6.3 percent to 3.9 percent.
  These lower tariffs will encourage economic growth in the United 
States and around the world.
  Economists estimate that when the agreement is fully implemented, the 
American gross domestic product will increase between $100 billion and 
$200 billion every year. That will produce hundreds of thousands of new 
jobs for American workers.
  My fellow Senators, we have come to the end of a long and vigorous 
debate. Eight years ago, negotiations on this agreement began. Three 
Presidents negotiated it. Their cumulative efforts reached a successful 
conclusion almost a year ago. The world's trading nations signed the 
accord on April 15 of this year, many months ago.
  The administration and the Congress jointly drafted the implementing 
legislation. It was introduced more than 2 months ago. The vote we are 
about to cast, as we all know, was delayed for 2 months for even more 
hearings.
  The Senate has fully, exhaustively, carefully, debated and considered 
this issue. Almost every provision in the agreement and the 
implementing legislation has been thoroughly examined.
  On Tuesday, the House of Representatives gave it an overwhelming 
bipartisan endorsement by a vote of 288-146.
  It is now the Senate's turn to act in the national interest. I urge 
my colleagues to vote for this agreement. It is in the Nation's best 
interest, and that must be our sole standard for voting on a measure of 
this significance. Reasonable men and women in this Chamber can 
disagree on how to define that interest. For myself, I say the Uruguay 
round trade agreement is good for America. Let us pass it now.
  The PRESIDENT pro tempore. The Senate will be in order.
  Mr. MOYNIHAN. Mr. President, I yield the remainder of our time.
  Mr. PACKWOOD. Mr. President, I yield the remainder of my time.
  The PRESIDENT pro tempore. The question is on the motion to waive 
titles 3 and 4 of the Congressional Budget Act of 1974, and section 23 
of H. Con. Res. 218, the concurrent resolution on the budget for fiscal 
year 1995, for the consideration of H.R. 5110. A vote of three-fifths 
of the Senators duly chosen and sworn is required for the adoption of 
the motion.
  The yeas and nays have not been ordered.
  Mr. MITCHELL. Mr. President, I ask for the yeas and nays.
  The PRESIDENT pro tempore. Is the demand sustained? Obviously, the 
demand is sustained.
  The yeas and nays are ordered.
  The clerk will call the roll, and the clerk will please repeat the 
name of each Senator and the vote cast so that these may be audibly 
heard by all people in the Chamber.
  The assistant legislative clerk called the roll.
  The PRESIDENT pro tempore. Are there any other Senators in the 
Chamber who have not voted?
  The yeas and nays resulted--yeas 68, nays 32, as follows:

                      [Rollcall Vote No. 328 Leg.]

                                YEAS--68

     Akaka
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Bradley
     Breaux
     Chafee
     Coats
     Cochran
     Cohen
     Conrad
     Coverdell
     D'Amato
     Danforth
     Daschle
     DeConcini
     Dodd
     Dole
     Domenici
     Durenberger
     Feinstein
     Glenn
     Gorton
     Graham
     Gramm
     Grassley
     Gregg
     Hatch
     Hatfield
     Hutchison
     Johnston
     Kassebaum
     Kennedy
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Levin
     Lieberman
     Lott
     Lugar
     Mack
     Mathews
     McCain
     McConnell
     Mikulski
     Mitchell
     Moseley-Braun
     Moynihan
     Murray
     Nickles
     Nunn
     Packwood
     Pell
     Pryor
     Riegle
     Robb
     Rockefeller
     Roth
     Sarbanes
     Sasser
     Simon
     Simpson
     Specter
     Warner
     Wofford

                                NAYS--32

     Baucus
     Brown
     Bryan
     Bumpers
     Burns
     Byrd
     Campbell
     Craig
     Dorgan
     Exon
     Faircloth
     Feingold
     Ford
     Harkin
     Heflin
     Helms
     Hollings
     Inhofe
     Inouye
     Jeffords
     Kempthorne
     Leahy
     Metzenbaum
     Murkowski
     Pressler
     Reid
     Shelby
     Smith
     Stevens
     Thurmond
     Wallop
     Wellstone
  The PRESIDENT pro tempore. Under the rules, there will be no 
demonstrations of approval or disapproval from the galleries.
  On this vote, 68 Senators have voted in the affirmative, the nays are 
32; three-fifths of the Senators duly chosen and sworn having voted in 
the affirmative, the motion is agreed to and the point of order fails.
  Mr. MITCHELL. Mr. President, I move to reconsider the vote by which 
the motion was agreed to.
  Mr. MOYNIHAN. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDENT pro tempore. The clerk will read the bill for the third 
time.
  The bill (H.R. 5110) was ordered to a third reading, and was read the 
third time.
  Mr. MOYNIHAN. Mr. President, I ask that the yeas and nays be ordered 
on the forthcoming vote.
  The PRESIDENT pro tempore. Is the demand sustained? The demand is 
obviously sustained.
  The yeas and nays were ordered.
  The PRESIDENT pro tempore. The bill having been read the third time, 
the question is, Shall the bill pass? The yeas and nays have been 
ordered, and the clerk will call the roll.
  Before the clerk proceeds, the Senate will be in order and the clerk 
will please repeat the names of Senators and state the vote that was 
cast so that all within the hearing of the clerk may be able to 
understand.
  The clerk will call the roll.
  The legislative clerk called the roll.
  The PRESIDENT pro tempore. Are there any other Senators who wish to 
change their votes?
  The result was announced--yeas 76, nays 24, as follows:
  The result was announced--yeas 76, nays 24, as follows:

                      [Rollcall Vote No. 329 Leg.]

                                YEAS--76

     Akaka
     Bennett
     Biden
     Bingaman
     Bond
     Boxer
     Bradley
     Breaux
     Bumpers
     Chafee
     Coats
     Cochran
     Cohen
     Conrad
     Coverdell
     D'Amato
     Danforth
     Daschle
     DeConcini
     Dodd
     Dole
     Domenici
     Durenberger
     Faircloth
     Feinstein
     Ford
     Glenn
     Gorton
     Graham
     Gramm
     Grassley
     Gregg
     Harkin
     Hatch
     Hatfield
     Hutchison
     Inouye
     Johnston
     Kassebaum
     Kennedy
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Levin
     Lieberman
     Lott
     Lugar
     Mack
     Mathews
     McCain
     McConnell
     Mikulski
     Mitchell
     Moseley-Braun
     Moynihan
     Murkowski
     Murray
     Nickles
     Nunn
     Packwood
     Pell
     Pressler
     Pryor
     Riegle
     Robb
     Rockefeller
     Roth
     Sarbanes
     Sasser
     Simon
     Simpson
     Specter
     Wallop
     Warner
     Wofford

                                NAYS--24

     Baucus
     Brown
     Bryan
     Burns
     Byrd
     Campbell
     Craig
     Dorgan
     Exon
     Feingold
     Heflin
     Helms
     Hollings
     Inhofe
     Jeffords
     Kempthorne
     Leahy
     Metzenbaum
     Reid
     Shelby
     Smith
     Stevens
     Thurmond
     Wellstone
  So the bill (H.R. 5110) was passed.
  Mr. MITCHELL. Mr. President, I move to reconsider the vote by which 
the bill was passed.
  Mr. DOLE. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. LEAHY. May we have order, Mr. President?
  Mr. MITCHELL. May we have order?
  The PRESIDENT pro tempore. The Senate will be in order. The Chair 
requests that all Senators please be in order.
  The majority leader.
  Mr. MITCHELL. Mr. President the vote to approve this treaty was 
overwhelming and bipartisan. On the crucial motion to waive the Budget 
Act, 68 Senators voted in favor, 32 opposed. Of 46 Republican Senators 
voting, 31 voted in favor, 15 against. That is 67 percent in favor. Of 
the 54 Democratic Senators voting, 37 voted for, 17 against. That is 69 
percent in favor; 67 percent of Republicans; 69 percent of Democrats, a 
total of 68 percent of the Senate voting in favor.
  Many persons deserve credit for this result.
  Mr. President, first I extend my congratulations to those who fought 
a vigorous battle in opposition to this agreement here in the Senate on 
high principle and with powerful arguments, led by the distinguished 
Senator from South Carolina, Senator Hollings, the distinguished 
Presiding Officer, the Senator from West Virginia, Senator Byrd, and 
all of those. We respectfully reached different conclusions on how to 
define the national interest, but we recognize and acknowledge that 
every single Senator has voted in the national interest as he or she 
sees it.
  I foremost congratulate the President, who provided crucial 
leadership on this important measure. He followed the path set by 
President Reagan and President Bush when they began and continued the 
negotiations, and President Clinton brought them to a successful 
conclusion last year. He was greatly assisted by the powerful and very 
effective work of the U.S. Ambassador for Trade, Mickey Kantor, a name 
not well known to most Americans but as a result of whose efforts 
Americans for generations to come will lead better lives.
  Here in the Senate, of course, great credit goes to the distinguished 
Republican leader, Senator Dole, who took an active role in working to 
improve what he saw as deficiencies in the agreement, and his work 
produced a better result. And our distinguished chairman and ranking 
member of the Finance Committee, Senators Moynihan and Packwood who led 
the debate with eloquence and fairness over these past 2 days. I thank 
them for their work, and I thank all Senators who saw fit to support 
the agreement, and I commend those who opposed it on principle.

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