[Congressional Record Volume 141, Number 119 (Friday, July 21, 1995)]
[Senate]
[Pages S10508-S10509]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                  UNITED STATES/JAPAN AVIATION DISPUTE

  Mr. PRESSLER. Mr. President, I am cautiously optimistic that last 
night in Los Angeles progress was made in the United States-Japan 
aviation dispute with regard to cargo. Finally, the Government of Japan 
has agreed to honor the clear terms of the 1952 United States-Japan 
bilateral aviation agreement. Federal Express had been unfairly denied 
the right to serve numerous Asian cities beyond Japan. Now that the 
Japanese have authorized these routes, Federal Express can finally open 
its new Pacific Rim cargo hub at Subic Bay in the Philippines.
  I am also pleased with the job done by Secretary Pena in this 
dispute. The Japanese clearly expected us to trade off existing 
aviation rights in order to get them to acknowledge rights we already 
had guaranteed under the terms of the United States-Japan aviation 
agreement. We did not cave in to this blackmail. Had we done so, it 
would have set a dangerous precedent for all U.S. international 
agreements. Global aviation opportunities for our carriers are critical 
to the long-term profitability of the U.S. airline industry. Secretary 
Pena understands this very important point.
   Mr. President, yesterday I, along with 20 colleagues from both sides 
of the aisle, introduced a resolution calling on the Government of 
Japan to immediately honor the terms of the United States-Japan 
bilateral aviation agreement. I have been developing the resolution 
over a period of several weeks and I understand the Government of Japan 
was monitoring it closely. I believe the resolution, Senate Resolution 
155, sent a strong signal to the Japanese that the United States Senate 
expects international agreements to be honored. We should expect 
nothing less when a solemn international agreement is in dispute.
  In my introductory remarks yesterday, I expressed disappointment that 
the show-cause order the United States 

[[Page S10509]]
issued to the Japanese on June 19 had not seemed to serve as a wakeup 
call for the Government of Japan. It was my hope that by introducing 
Senate Resolution 155 simultaneously with the negotiations in Los 
Angeles it would drive home the point that international agreements are 
not to be unilaterally disregarded. I hope Senate Resolution 155 played 
a role in resolving this dispute.
  Let me say to the cosponsors of this resolution that we still may 
bring it to the floor. We may seek to pass it because the resolution 
also addresses an important passenger carrier dispute with Japan that 
remains unresolved. What is happening is that Japan has denied our 
passenger and cargo carriers new opportunities to serve countries 
beyond Japan such as Korea, Malaysia, and so forth. The Japanese refuse 
to recognize ``beyond rights'' guaranteed by our air service agreement. 
That is what this dispute is all about.
  Unfortunately, our aviation dispute with Japan over ``beyond rights'' 
is not completely behind us. United Airlines has patiently waited while 
U.S. negotiators focussed on the cargo dispute. Now, the United States 
must demand the Government of Japan honor the rights of our passenger 
carriers as well. United Airlines has been wrongly denied the right to 
start new service between Osaka and Seoul, Korea. This is another clear 
violation of the United States-Japan bilateral aviation agreement. It 
must be redressed promptly.
  Mr. President, let me also say I am angered by some media reports 
from Japan declaring victory in the aviation dispute. Let me make this 
point loud and clear: This was not a victory for Japan. For months the 
United States has been offering to talk with the Government of Japan 
about our bilateral aviation agreement. Quite correctly, the United 
States said it would do so only after Federal Express' beyond rights 
were honored by the Japanese. These reports are preposterous.
  The aviation dispute accomplished nothing for Japan beyond 
temporarily protecting its inefficient carriers from more head-to-head 
competition with our carriers. The dispute did galvanize Congress to 
take a tough stand in future aviation relations with Japan. It showed 
what our Government can accomplish when Congress supports our Secretary 
of Transportation and permits him to negotiate from a position of 
political strength.
  Mr. President, I hope our resolve in the United States-Japan aviation 
dispute sends a strong signal to nations around the world. if you enter 
into an agreement with the United States, you will not be allowed to 
pick and choose those provisions with which you will comply. Agreements 
between nations are solemn.
  So, Mr. President, let me summarize by saying that last night I think 
our Government showed great progress in reaching the cargo aviation 
agreement with Japan. However, we did agree to give them some things in 
exchange for the agreement such as new cargo routes between Japan and 
Chicago. That might appear to some that we gave in. Overall, however, I 
think we stood firm and the cargo agreement is a step forward.
  As Chairman of the Senate Commerce, Science, and Transportation 
Committee, I called a hearing last week to consider problems our air 
carriers experience trying to fly beyond Tokyo and beyond Heathrow. 
There is a system in both directions that prevents our carriers from 
flying beyond these important international gateways.
  At times, the system which blocks our carriers can be subtle. For 
example, sometimes the Japanese and British technically comply with our 
aviation agreements but they impose certain ``doing business'' problems 
that prevent our carriers from competing effectively with their 
national carriers. Among these restrictions on competition are problems 
loading and unloading aircraft and requiring our carriers to use the 
old terminal while the host country carrier uses the modern terminal. 
There are other barriers that prevent our carriers for serving global 
destinations from Heathrow and beyond Japan.
  Mr. President, I want to commend Secretary Pena. He has done an 
excellent job resolving this particular dispute. I have been a critic 
of his at times in the past. I am very sympathetic to the tough 
challenge he faces in international aviation negotiations.
  What happens to the Secretary of Transportation is he is frequently 
undercut because what our air carriers tend to do is the one that gets 
the right to serve a foreign country sometimes works with the foreign 
government to keep other U.S. carriers out. Then the Secretary is 
presented with a letter from 6 or 8 Senators and 8 or 10 House Members 
who have a particular airline in their State or district which urges 
the Secretary to put the interest of the incumbent carrier ahead of the 
national goal of creating new opportunities for all our carriers. This 
undermines the Secretary's negotiating position.
  To help correct this significant problem, I have urged that the 
economic interests of the United States be the basis for the Secretary 
of Transportation's international negotiations.
  Mr. President, I do not see this as the end of our aviation problems 
with Japan. As I mentioned, a significant passenger issue involving 
United Airlines remains unresolved. Also, I suspect, having observed 
Japan's trade habits and protectionist activities, that they are going 
to keep attempting to block our carriers from serving points beyond 
Japan. There are many lucrative new air service opportunities in the 
Pacific rim. The Japanese know this and they likely will try to keep 
them for their own carriers.
  We on this floor need to support the Secretary of Transportation in 
his efforts to open new international opportunities for our carriers 
and to protect existing aviation rights. We need to let the Secretary 
put the economic interests of the United States first. I hope someday 
we will no longer have to get bogged down in a system of bilateral 
aviation agreements. Instead, I hope one day we will have a 
multilateral aviation framework, like a GATT worldwide open skies 
agreement.
  I congratulate the Secretary of Transportation. But I still think we 
may need to pass a resolution in the Senate giving the Japanese notice 
that we consider this a major trade issue. Also, we need to let the 
Japanese know that we expect the unresolved passenger carrier issue to 
be resolved promptly.
  Mr. President, I yield the floor. I thank you very much for the 
additional time.

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