[Congressional Record Volume 142, Number 96 (Wednesday, June 26, 1996)]
[House]
[Pages H6905-H6913]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT, AND
INDEPENDENT AGENCIES APPROPRIATIONS ACT, 1997
The SPEAKER pro tempore. Pursuant to House Resolution 456 and rule
XXIII, the Chair declares the House in the Committee of the Whole House
on the State of the Union for the further consideration of the bill,
H.R. 3666.
{time} 1733
In the Committee of the Whole
Accordingly the House resolved itself into the Committee of the Whole
House on the State of the Union for the further consideration of the
bill (H.R. 3666) making appropriations for the Departments of Veterans
Affairs and Housing and Urban Development, and for sundry independent
agencies, boards, commissions, corporations, and offices for the fiscal
year ending September 30, 1997, and for other purposes, with Mr.
Combest in the chair.
The Clerk read the title of the bill.
The CHAIRMAN. When the Committee of the Whole rose earlier today,
amendment No. 7 offered by the gentleman from Texas [Mr. Bentsen] had
been disposed of.
amendment offered by mr. kolbe
Mr. KOLBE. Mr. Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:
Amendment offered by Mr. Kolbe: Strike Section 421 of the
bill.
Mr. KOLBE. Mr. Chairman, before I proceed, I ask unanimous consent
that, while they are trying to work out the issue on the other
amendments, that, the gentleman from Wisconsin, [Mr. Obey] is in
agreement, that all debate on this amendment and all amendments thereto
be limited to 60 minutes, with the time equally divided between myself
and the gentleman from Minnesota. That is pursuant, I might add, to the
agreement that we had agreed to earlier in the larger unanimous
consent.
The Chairman. Is there objection to the request of the gentleman from
Arizona?
Mr. OBEY. Mr. Chairman, I object.
The CHAIRMAN. Objection is heard.
Mr. KOLBE. Mr. Chairman, let me begin by laying out the background of
this case. A few months ago, the University Corporation for Atmospheric
Research, which is a part of the National Science Foundation, began to
consider bids for a new supercomputer. They had been using a Cray
computer, and they went through the normal procurement process, the
conclusion of which was a bid an unusual bid in the amount of money
that was set--$35 million--won by NEC. There is no dispute over the
amount of dollars of this procurement. It is $35 million. But to
continue, in the RFP that was proposed, the question was posed--what
could you do for $35 million? Clearly the bid proposal from NEC, the
Japanese company that makes supercomputers, was the best offer.
Following that decision or that initial bid proposal, this
information was conveyed to the White House. It was also conveyed to
the Department of Commerce.
The Department of Commerce then subsequently wrote a letter to the
National Science Foundation in which they said they had investigated
the matter and made a preliminary decision that there was clear dumping
here. That is, NEC was selling this computer or the software for this
computer, at well below cost.
As a result of that letter, even though it was simply a letter and
nothing more, remember no formal investigation has ever been conducted
into allegations of dumping, language was added in the subcommittee and
retained by the full committee, which
[[Page H6906]]
would put in place a limitation on funds for any employee of the
National Science Foundation that proceeds to sign a contract for the
purchase of an NEC computer, if, there has been a preliminary or final
finding of dumping on the part of the Department of Commerce.
My amendment would seek to strike that language. Why do I seek to do
this? Am I against Cray computers, American-made computers as opposed
to Japanese computers? Of course not.
The fact of the matter is, Mr. Chairman, we have a process, a process
that is established in law. That process is that an antidumping
procedure may be initiated if dumping is believed to have occurred.
Almost always it is initiated by the industry. But it can be self-
initiated by the Department of Commerce. That is rarely done and has
not been done in this case. In fact, there has been no initiation of an
antidumping case on the part of the Department of Commerce regarding
this procurement.
The Department of Commerce simply on their own wrote a letter which
bypassed this internationally recognized procedure and simply said, we
think there is dumping going on here.
The law is very clear. If Commerce decides to initiate a dumping
procedure, they then send that inquiry to the International Trade
Commission. The International Trade Commission then decides on an
initial basis, if injury has been done. They then send it back to the
Department of Commerce to determine the amount of the damages and
injury that has been done, or whether injury has occurred. The
International Trade Commission then makes a decision as to the extent
of the damages, and the final result is that a sanction may be applied.
The only sanction under the law, and I would hope that this body
cares a little bit about following the law, the only sanction under the
law is that a tariff may be applied against the company that is
dumping, the industry which is dumping, in this case against NEC. It is
very clear, and in fact our trade laws make it very precise, that we do
not link procurement with dumping laws because that violates the
international agreements that we have, World Trade Organization
agreements.
We do not link the procurement process with dumping. So it is against
the law for us to unilaterally impose punitive measures and say, you
cannot go ahead and buy this computer. If indeed the NSF proceeded to
buy this computer and it was found that there was dumping, a tariff may
be applied in the future, against any other computers that are bought.
That is the background of this case.
In essence, the action of the subcommittee of adding this language
violates our procurement laws. It violates our antidumping law and it
violates WTO agreements. We have made a big thing in this country, and
I hope in this body, about the rule of law. We have tried to get other
countries to follow the law. We have tried to get those countries to
follow the law so that they would abide by the rule of law.
We have made a big case about getting Japan to open its market to
computers, and we have had some success.
The CHAIRMAN. The time of the gentleman from Arizona [Mr. Kolbe] has
expired.
(By unanimous consent, Mr. Kolbe was allowed to proceed for 2
additional minutes.)
Mr. KOLBE. Mr. Chairman, we have had some considerable success in
this regard. In fact, Cray has sold and installed in Japan 170
supercomputers. NEC has installed in Japan, their own country, 80
computers.
In the United States, Cray has installed 320 supercomputers versus 2
for NEC and none to a Government corporation, a Government agency.
Mr. Chairman, are we to suggest here tonight that we are going to
deny the right of the NSF, which has looked at the bids and has decided
that this is clearly the superior computer, that we are going to say,
you cannot proceed with that and jeopardize all of the trade laws, all
of the sales which Cray and others have made, all of the efforts we
have made to open this market to our computers and to other countries
and to other companies that sell in that market?
I want to make it clear that the bottom line has nothing to do with
whether it is Cray or NEC that gets the NSF contract. It is a process
that must be followed here. There is a process for an antidumping case.
The process has not been followed by the Department of Commerce, and
this body is preparing to violate it in a very major way tonight.
Because we are going to say, notwithstanding our procurement laws,
notwithstanding the antidumping laws, and notwithstanding the WTO and,
by the way, Japan will have a perfect case to take against us to the
WTO and we will be sanctioned then on all computers that we try to sell
in Japan, notwithstanding all that we are simply going to say that, if
the Department of Commerce writes a letter, with no investigation ever
conducted, that you cannot buy this computer. That violates the law. It
violates the rule of law. It violates all the standard procedures, and
we ought not to do it.
Let us follow the procedure. We stand for the rule of law. We stand
for doing the right thing. I urge my colleagues to reject this
language, to support the Kolbe amendment, to reject this language and
to remove it from the legislation.
Mr. OBEY. Mr. Chairman, I rise in opposition to the amendment.
Mr. Chairman, the issue here is very clear. The issue is whether we
are going to stand up for America and stand up for fair trade under the
rule of law or not.
What are the facts? This Congress is being asked to appropriate $277
million, and the purpose for that, I quote, is ``to promote fundamental
research in education and computer and information sciences and
engineering and to maintain the Nation's preeminence in these fields.''
Despite that, a grantee of the National Science Foundation wants to
purchase a supercomputer. They have put out a bid to buy it for a fixed
price of $35 million. Three companies bid, one American company and two
Japanese companies. The United States machine on a pound-for-pound and
chip-for-chip basis ran at a faster clock speed than did their Japanese
competitors. But one Japanese company, NEC, proposed to sell three
times the machine at an estimated cost to manufacture of somewhere
between $90 million and $110 million. So they proceeded to try to sell
a machine which cost three times as much as the price at which they
were willing to provide it to the NSF grantee.
The NFS was warned by the Commerce Department that this appeared to
be a case of dumping, and it appeared to be a violation of our trade
rules. But before the Commerce Department could get a written document
to the NSF, NSF decided to proceed anyway because they wanted to have
that computer at a cut-rate price.
{time} 1745
Now the question is why would the Japanese sell a $110 million
computer for 35 million bucks? It is very simple. The supercomputer
industry is critical to the future economic strength of this country
and to our national security. The supercomputer industry is very small,
but it is a cornerstone of U.S. competition and of our competitive
posture.
It is crucial to the design of aircraft, it is crucial to the design
of jet engines.
In World War II, one of the reasons we won is that we broke the
Japanese and German codes. The Nation with the best supercomputer
capacity can decode another Nation's secrets, it can predict weather
better, it can unravel the mysteries of genetics. It is absolutely key
in the design and simulation testing for new automobiles, for new
weapons, for new aircraft, for new items of virtually every kind in the
economy, for new drugs.
A supercomputer, for instance, is key to the design of the new Boeing
777. And yet financial analysts who look at what is happening in this
field worry about the long-term survivability of the U.S. supercomputer
industry. Now, they do not worry about it because they think we do not
produce products of quality. They worry about it because of the huge
deep pockets that Japanese corporations have in comparison to American
corporations who produce these supercomputers. U.S. companies have to
finance their R&D, their development of new products out of profits
from current sales. But in Japan, Fijitsu and NEC are backed by
virtually limitless credit from their huge mega banks.
[[Page H6907]]
I would point out that neither Japanese supercomputer company has
ever made a profit selling supercomputers. They are willing to sell at
a loss simply because they want to break the U.S. market, they want to
drive the U.S. industry right off the face of the globe, and then they
will have an absolute and total monopoly on supercomputer capacity and
capability in this world.
So now what this bill says is something I suppose some people see as
very shocking. It says simply that none of the funds can be used for
this agency to purchase a supercomputer if the Commerce Department
determines that it has been dumped on the U.S. market. Now, the
Commerce Department has not yet made a preliminary nor a final
determination. They have made an initial guess about it, and they tried
to stop the agency and slow them down until this could be evaluated,
but the agency was hell-bent to go ahead because they were putting
their own narrow interests, in my view, ahead of the broader interests
of the country.
The CHAIRMAN. The time of the gentleman from Wisconsin [Mr. Obey] has
expired.
(By unanimous consent, Mr. Obey was allowed to proceed for 3
additional minutes.)
Mr. OBEY. Now, the authors of this amendment or the author of this
amendment is saying that it violates trade laws. It most certainly does
not. There is no trade law, there is no trade pact which we have joined
which requires us to accept dumped goods. The authors say, ``Well, why
don't you follow the process normally used for consumable items? That's
what you ought to do.''
The problem is it is very different if one is dealing with an
automobile versus a supercomputer because if one simply waits and
allows for a final determination down the line, the only penalty is to
assess an additional tariff. Japan has already indicated they will
gladly accept that additional tariff in order to bust the U.S. market
and compete successfully because of their deep pockets.
We are told that the Congress is violating the law if they do what
the committee is suggesting. They do not. The Congress does not violate
the law. If my colleagues take a look at Footnote 24 to the antidumping
agreement to which America subscribes, there is a recognition that
other actions can be taken. It is suggested that we are violating the
procurement law. That is not correct, because the procurement law only
applies directly to American agencies, and what we are discussing here
is the action of a grantee of a U.S. agency.
So there is in no way a violation of either U.S. law or violation of
trade agreements to which we have become a party.
There is a reason why the gentleman from California [Mr. Hunter], why
the gentlewoman from Ohio [Ms. Kaptur], why myself, why the gentleman
from Minnesota [Mr. Sabo], Ross Perot and a wide variety of people in
both parties support the committee action: because they recognize that
it is critical to the security interests of this country, they
recognize that it is critical to the long-term economic needs of the
country.
All we are saying is, if in the end this computer is determined to be
purchased at a dumped price, do not buy it. That is all it says. We
could have gone much further, as has been done in the defense bill, and
simply say, ``You can't sell any foreign computer.'' We did not say
that. We preferred to allow the Commerce Department to make a rational
determination. That is what one would do if they are interested in
protecting the national security interests of the United States.
Mr. Chairman, I would urge a ``no'' vote on the amendment.
Mrs. JOHNSON of Connecticut. Mr. Chairman, I move to strike the last
word and rise in support of the Kolbe amendment.
Mr. Chairman, because of Japan's trade barriers, the United States of
America negotiated an agreement with Japan to have free, open, and
transparent trade in government procurement of supercomputers. yes;
this does violate that agreement. It is written so broadly it does
violate that supercomputer bilateral agreement. It also violates the
World Trading Organization's, the WTO's, antidumping agreement. It also
violates a WTO government procurement agreement.
Now, who wins from this international trading system? America wins.
If the international trading system goes under, we lose international
protection of property rights, of intellectual property rights. If is
all part of the same system. We benefit from the international protocol
that governs trading, and we cannot go out there and violate the
agreements that America has put her signature to.
As a result of this agreement, whose goal it was to overcome Japanese
barriers in their market, the United States has sold 12 supercomputers
to the Japanese Government. Now a Japanese company is about to sell one
to our Government. That is a pretty good deal.
The American market is growing only slowly because our population is
growing only slowly and our population is aging. Older people do not
buy as much as younger people. If we are to have a rising standard of
living for our folks, if we are to have faster growth in our economy,
we must be competitive in the international market and we must have
solid rules that govern international trading, or our kids will not
have the career opportunities they want and they will not have the
rising standard of living they hoped for.
If there is one thing my constituents are concerned about and one
thing they say to me day after day, it is, ``We're concerned about wage
stagnation''. And believe me, Connecticut has had a tough time in the
last 5, 6, 7 years. Wage stagnation, slow economic growth; those are
the problems we face, and if we persist or if we go forward with this
proposal that blatantly violates an agreement we put our name to, we
will not only lose in the short term, as Japan retaliates in whatever
industry she targets, but in the long term we lose the protection of
international trade law and that will cost us jobs. Retaliation hurts.
It is not neutral. It costs jobs. It cuts incomes. But worse than that,
it sends a terrible signal. The affirmative action to abrogate an
agreement we are a party to, following passage of Hill-Burton and the
legislation offering trade with Iran, sends a signal to the
international community that we are not prepared to adhere to the only
trade protection that can assure fair trade. I have fought all of my
years here in Congress for fair trade. I fought for the machine tool
industry, I fought for the bearing industry, I fought to preserve our
dumping laws, I fought for 301 retaliation. I have been over there in
Geneva with many of my colleagues with Chairman Rostenkowski, former
chairman of the Committee on Ways and Means, as the final deals on the
GATT agreement, were made. We fought hard to get our way and we won on
most points.
For us now to purposefully, consciously, by legislation, violate
agreements that we put our name to and that are benefiting us simply is
nuts, and it is going to destroy our credibility as a member of the
international trading community. It is going to hurt international
trading companies, and more and more we know it is the small companies
who are in our export market, and it is going to cost jobs. It is going
to undermine the very export promotion programs, the export growth,
that is driving America's economy.
We do not domestically have the buying power anymore to guarantee our
people a rising standard of living. We do not have it. We are not
growing that rapidly, and we are aging rapidly. We depend on success in
the export market.
Not to support the amendment offered by the gentleman from Arizona
(Mr. Kolbe) to strike this provision from this bill is to say to
people, ``I'm more interested in politics that I am in your wages and
in your economic future and in the strength of this Nation and the
preservation of the very regimen that guarantees, that has the best
hope of creating for us free and fair trade worldwide, and with that
free and fair trade over the decades ahead, prosperity and peace.''
I urge support of the Kolbe amendment.
Mr. LEWIS of California. Mr. Chairman, there has been a bit of
discussion on both sides regarding the question of time limitation
earlier, and, as I understand it, the gentleman from Wisconsin [Mr.
Obey] and the gentleman from Arizona [Mr. Kolbe] are in agreement
separately to have 20 minutes on
[[Page H6908]]
each side on this amendment. Presuming that, I ask unanimous consent to
limit the time to 40 minutes, 20 minutes on each side.
The CHAIRMAN. Is there objection to the request of the gentleman from
California?
Mr. SKAGGS. Reserving the right to object, Mr. Chairman, if I may, I
have a very direct district interest in this particular controversy,
had not been involved in the negotiation on the time limit and,
therefore, have not had a chance to discuss with the gentleman from
Arizona [Mr. Kolbe] what the allotment of time might be under the
proposed unanimous-consent request.
Mr. LEWIS of California. Mr. Chairman, will the gentleman yield?
Mr. SKAGGS. I yield to the gentleman from California.
Mr. LEWIS of California. Mr. Chairman, the request is 20 minutes on
each side.
Mr. SKAGGS. I mean within the gentleman's 20 minutes, and I just need
assurances of an adequate piece of that time from the gentleman.
Mr. LEWIS of California. We will try to see if we can get him to
yield.
The CHAIRMAN. The gentleman from California's unanimous-consent
request is for 20 minutes controlled by the gentleman from Arizona [Mr.
Kolbe] and 20 minutes controlled by the gentleman from Wisconsin [Mr.
Obey].
Mr. LEWIS of California. Yes, Mr. Chairman.
The CHAIRMAN. Is there objection to the request of the gentleman from
California?
There was no objection.
Mr. KOLBE. Mr. Chairman, I yield 4 minutes to the gentleman from
California [Mr. Campbell].
(Mr. CAMPBELL asked and was given permission to revise and extend his
remarks.)
Mr. CAMPBELL. Mr. Chairman, I wish to begin on the question of the
Government procurement code, and I would yield to my good friend from
Wisconsin, if I could have his attention. Might I have the attention of
the gentleman from Wisconsin [Mr. Obey], the author of the provision to
which I am speaking? I wanted to offer to yield to my good friend from
Wisconsin, and if I am wrong, I will be the first to admit it.
But I have a copy of the procurement code in front of me, and the
reason why I am speaking is that I took the gentleman's comments to say
that the procurement code did not cover this case because the
procurement is by the National Science Foundation, and I will yield if
the gentleman would make his point regarding the procurement code, and
then I will read the section on point.
{time} 1800
Mr. OBEY. Mr. Chairman, will the gentleman yield?
Mr. CAMPBELL. I yield to the gentleman from Wisconsin.
Mr. OBEY. I did not have a point to make on the procurement code, Mr.
Chairman. The gentleman from Arizona [Mr. Kolbe] suggested we were in
violation of procurement laws. I said that we were not, because the
argument that has been made about that relates to the action of
government agencies, not grantees.
Mr. CAMPBELL. Mr. Chairman, I appreciate the gentleman for
responding. Here is exactly why I want to speak to the point. The
procurement code reads, in article I section 3: ``Where entities, in
the context of procurement covered under this Agreement, require
enterprises not included in Appendix 1 to award contracts in accordance
with particular requirements, Article III shall apply . * * *''
So the procurement code in itself deals with Government agencies and
then, in article I, section 3, says, and I repeat: ``Where entities, in
the context of procurement * * * require enterprises not included in
Appendix 1 to award contracts in accordance with particular
requirements, Article III shall apply. * * *''
So unless the gentleman wishes to correct me, and I would yield to
him for that purpose, I believe his point is, with good intention no
doubt, simply erroneous--that the procurement code does apply where a
Government agency imposes a requirement on another enterprise in regard
to a contract, as this law would. My friend, the gentleman from
Arizona, makes a very valid point. This provision violates the
procurement code.
Mr. KOLBE. If the gentleman would yield this amendment is a
limitation on the National Science Foundation, which is an agency, so
it clearly does go to the procurement code, to the National Science
Foundation. I would also make the point that the procurement code says
we must give national treatment: We cannot treat one country
differently than another. This does that, it violates the WTO, it
violates the procurement code.
Mr. CAMPBELL. Mr. Chairman, I grant the gentleman's point, but I
think we have an even better point. Even if the Obey language were a
requirement upon an enterprise, rather than the Government entity
itself, it is covered by the procurement code. So I believe we have
them both ways. This does violate the procurement code. The policy
question I have is, do we want to violate the procurement code? I
certainly hope we do not wish to violate international trade law, but
that is what Government procurement code is.
The second and last point that I have to raise is the issue about
violating the antidumping code. I would like the chairman's permission
to recite what a commissioner of the U.S. International Trade
Commission has told my good friend, the gentleman from Arizona, on June
19. He said, ``I believe that the amendment, if passed,'' referring to
the amendment by the gentleman from Wisconsin, ``is in probable
violation of our GATT-WTO obligations. In particular, the amendment
appears to be inconsistent with article 18.1 of the antidumping code,
which prohibits GATT members from taking punitive measures in response
to dumping, other than those set forth in the antidumping code.''
The reason is this: We have in our antidumping law a requirement
that, first of all, the Department of Commerce find that there is a
difference in price in the country where the good is sold and made and
the country into which it is imported. Then following that, there must
be an injury finding. The reason is the natural concern that countries
have that if goods are selling at two different prices in two different
markets just because the market conditions are different, that that may
or may not be unfair. But if there is injury to the U.S. domestic
market because of it, then it is unfair. I note that the gentleman from
Wisconsin's amendment does not include that injury requirement.
Mr. OBEY. Mr. Chairman, I yield 2 minutes to the gentleman from New
York [Mr. Walsh].
Mr. WALSH. Mr. Chairman, I thank the gentleman from Wisconsin for
yielding time to me.
Mr. Chairman, I rise in opposition to the Kolbe amendment and in
support of the committee bill. Mr. Chairman, this procurement for the
NCAR, National Center for Atmospheric Research, for a supercomputer of
Japanese make, Japanese make, NEC, what we are doing is supporting a
policy of subsidizing prices of Japanese products by the Japanese
Government for sale in the United States.
We have a history of this. My background was in telecommunications. I
saw it happen in the telecommunications industry. We are talking about
a sale of a computer for $35 million that has been estimated to be
worth $100 million. If this was a supermarket, this would be referred
to as a loss leader. You walk in the door, you buy a quart of milk for
50 cents, and you hopefully, as far as the supermarket is concerned,
spend a whole lot more money while you are there. This is a way to get
in the door. It is dumping. It is a subsidy.
If our laws do not cover this, I would be surprised, but good
judgment should. Good judgment should. If the NSF has found themselves
a good deal by comparing two fairly similar computers, and they get a
similar price so they opt for the Japanese make, that is fine; but the
fact is the Commerce Department has determined that NEC is dumping, and
we should be supporting that activity. So I would strongly urge a
``no'' vote on the Kolbe amendment, and stop rewarding foreign dumping
in the United States.
Mr. KOLBE. Mr. Chairman, I yield 5 minutes to the gentleman from
Colorado [Mr. Skaggs].
Mr. SKAGGS. Mr. Chairman, I thank the gentleman for yielding time to
me.
[[Page H6909]]
Let me pick up where the gentleman from New York left off, because
there has been no Department of Commerce determination of dumping. What
there has been is what I think would be best referred to as an
extraordinary back-of-the-envelope, very unusual, preliminary,
preliminary guess by the Department of Commerce that there might be
dumping. But upon analysis, two things are really very clear: First,
they did the arithmetic wrong; second, they should not have done the
arithmetic to begin with, because it is out of the normal process for
dealing with these issues.
As the gentleman from California pointed out, the law provides a very
firm, formal methodology for determining whether below-cost, unfair
pricing occurs, and then what the remedy should be. We have not gotten
to that point yet.
Clearly we should not be using taxpayer money to buy a foreign-made
good that is dumped in this country. No argument about that. But we are
getting way ahead of ourselves in assuming that that has been
established in this case, because it has not.
There has been only one other case that anyone that I have been able
to find could remember where the Department of Commerce issued this
kind of an extraordinary predetermination before a case has even been
filed. So, for some reason, the Department of Commerce wants to get
ahead of its normal process in this case. In doing so, it simply, as
far as I have been able to determine, probably did a sloppy job.
The reason it reached its conclusion, as far as one can tell, and we
are none of us experts in this kind of analysis, was because they
apportioned the R&D costs attributable to this machine across one-tenth
of the number of units that should be used, thereby greatly inflating
the proportion of R&D costs that would be factored in; and second,
because they failed to look at it as a lease transaction, in which
there would be residual value going back to the manufacturer or the
lessor, which would serve to increase the net profit.
But in any case, Mr. Chairman, we do not have any business doing this
on the floor of the House of Representatives.
What this is about is the earnest, good faith effort made by the
National Center for Atmospheric Research [NCAR], which happens to be
based in Boulder, CO. It does world class science on the atmosphere. It
needs the most powerful computer capability it is able to buy with its
NSF grant, with taxpayer money, to do the best work it can for all of
us.
NCAR started out some time ago in this procurement effort, put out an
RFP to 14 prospective vendors, 12 of them U.S. manufacturers; has
strictly adhered to the Federal acquisition regulations throughout the
process; ended up with three serious proposals; asked all of those
people to go through best and final offer; and has now, at the request
of the Department of Commerce, undertaken its own very rigorous
analysis to determine whether there is any unfair pricing involved in
this. I am absolutely certain it will be perfectly prepared to
reexamine this whole exercise if there is any solidly developed
determination, preliminary or final, of unfair pricing. But we simply
do not have that.
Mr. Chairman, if we want to have a debate in this body about whether
we should ever allow a supercomputer to be purchased with U.S.
Government taxpayer funds from other than a U.S. manufacturer on
national security, national infrastructure grounds, let us have that
debate in an appropriate setting. It is not appropriate to be having
that discussion as an adjunct to an appropriations bill. We already
have in law all the guarantees and remedies necessary to deal with
unfair pricing if it should turn out to be the case in this instance.
With respect to the question of the future of U.S. supercomputing,
there are, by GSA analysis, General Services Administration analysis,
some 700 supercomputers currently owned by various agencies of the U.S.
Government, approximately 500 of those 700 in various Defense
Department and national security-related agencies that are essentially
going to be buying American. So if there is any question that we are
going to have a very, very substantial and virtually guaranteed market
for an American supercomputer industry, rest easy.
Mr. OBEY. Mr. Chairman, I yield 2 minutes to the gentleman from
Michigan [Mr. Levin].
(Mr. LEVIN asked and was given permission to revise and extend his
remarks.)
Mr. LEVIN. Mr. Chairman, we could debate the technical issues, and I
enjoy doing that on antidumping. This provision that the Kolbe
amendment is attacking may not be perfectly drawn, but let me say I
think the amendment is a very imperfect solution. There is a real
problem here. In the past, industries in this country have been
targeted. In the 1980's it was semiconductors, machine tools,
televisions, VCR's; almost you name it, and a major industry was
targeted.
Now there is considerable evidence that supercomputers are being
targeted, and what is happening is that profits from a sanctuary market
in Japan are being used to drive out the remaining U.S. companies. Most
of them are out of business.
I suggest, Mr. Chairman, that this is not the appropriate forum to
discuss all the intricacies of our antidumping laws and the role of
this agency or another agency. There is a problem here. The bill has an
honest effort to address it. If there are some technical problems with
it, it can be handled later on, but do not try to cure that by ignoring
what is a real problem in an important industry, as the L.A. Times
said, one of the industries of the future, really of the present, a
corner of American competitiveness.
It has been said we are getting way ahead of ourselves. To the
gentleman from Colorado [Mr. Skaggs], I would say in the past the
problem has been we have been way behind when American industries have
been targeted and have been lost. Let us not lose this one. Defeat the
Kolbe amendment.
Mr. KOLBE. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, the gentleman from Michigan [Mr. Levin] is absolutely
correct. There is a problem here. He said, let us not worry about the
technical aspects of this. We can correct that later. There is a
problem, all right. We are violating GATT and WTO agreements, we are
violating our antidumping laws, we are violating our procurement laws;
just minor little details, apparently, to some people. I think these
are important matters. We have a firm commitment in this country to the
rule of law. We ought not to so casually and cavalierly disregard that.
I would also like to respond to something that was said earlier by
the gentleman from Wisconsin when he talked about the danger that we
face of driving our industry out. Some danger: Cray has installed 130
supercomputers in Japan versus 80 by NEC and Fujitsu; in other words,
more than 50 percent more by an American company. We are endangering
that, all right. We endanger selling any more American computers in
Japan if we take this kind of action, because they have a perfect
recourse under the WTO to stop us, to levy fines and sanctions against
us from selling computers.
Another point that should be made is that Cray has installed 320
supercomputers in the United States versus 2 from NEC. Some danger that
Cray is in here. The gentleman is right, we are endangering. We are
endangering the U.S. industry with this action, not with the action
that was taken by the National Science Foundation and its grantee, the
University Corporation for Atmospheric Research, which did follow the
procurement procedure exactly as they were supposed to.
Finally, let me say with regard to the matter that NEC is selling at
below cost, the National Science Foundation, or rather the University
Corporation for Atmospheric Research [UCAR], asked for an analysis to
be done by a respected law firm here in Washington on this issue. They
concluded that the Department of Commerce analyzed the wrong
transaction. The treaty antidumping statute applies to the sale of
imported merchandise to the first U.S. party, unrelated to the
exporter. It does not have anything to do with leased kinds of
equipment.
It also says that antidumping law provides, they concluded, that the
fair value determination should be made by comparing prices for the
same or similar products in the exporters' market or third
country market with the U.S. price; but they conducted the type of
constructed value analysis that is a method of price comparison that is
invalid in this country, because of the
[[Page H6910]]
absence of a home market or third country sales that have not been
demonstrated.
{time} 1815
So even on the back-of-the-envelope analysis that was done, by
Commerce and the gentleman from Colorado [Mr. Skaggs] had it exactly
right, it was a back-of-the-envelope kind of thing, they said on their
own that they did not want to actually initiate antidumping because
they were uncomfortable. The Department of Commerce instead just sent
this letter. So they violated the process that they are supposed to
follow, that the industry is supposed to follow to have an antidumping
case.
We have an antidumping process because Members on that side of the
aisle and this side of the aisle said there has to be a way from
companies to deal with this when there are allegation of dumping. Well,
let us follow the law.
I would just say that what I am talking about here is the process.
Again, there is a process to be followed. We are not following that
process, and we are suggesting that we are just simply going to ignore
the law.
Mr. Chairman, I reserve the balance of my time.
Mr. OBEY. Mr. Chairman, I yield 2 minutes to the gentleman from New
York [Mr. Houghton].
(Mr. HOUGHTON asked and was given permission to revise and extend his
remarks.)
Mr. HOUGHTON. Mr. Chairman, I thank the gentleman for yielding me
time.
I rise to oppose the Kolbe amendment. I do so reluctantly because I
have respect for the gentleman from Arizona [Mr. Kolbe] and for the
position which he is taking. However, we can argue the legalities
endlessly here in terms of whether we are violating any procedural
process with GATT or the World Trade Organization.
I am not going to get into that because there are interpretations on
both sides of this thing which I could agree with if I listen to very,
very erudite lawyers.
However, what I am saying is this: Over a period of years I have seen
egregious examples of dumping coming in very small packages. It would
seem to me this particular case with the National Science Foundation
that it is a perfectly normal and legal and obvious approach to have
the Department of commerce review this to see whether there is any
dumping.
Once you get an acknowledgment of the fact that NEC or any other
computer is approved by an extraordinary group like the National
Science Foundation, then you have something far more than the purchase
of that one unit. I think is a perfectly normal process, I agree with
it, and I reluctantly oppose the Kolbe amendment.
Mr. OBEY. Mr. Chairman, I yield 4 minutes to the gentleman from
Minnesota [Mr. Sabo].
Mr. SABO. Mr. Chairman, I rise in strong opposition to the Kolbe
amendment.
In behalf of the language that is in the bill, might I inquire of the
gentleman from Wisconsin [Mr. Obey] what our language is in the bill?
Mr. OBEY. Mr. Chairman, will the gentleman yield?
Mr. SABO. I yield to the gentleman from Wisconsin.
Mr. OBEY. Mr. Chairman, all the language says is that, if it is
determined that this supercomputer has been dumped on to the U.S.
market, that it cannot be bought.
Mr. SABO. I thank the gentleman.
Mr. Chairman, reclaiming my time, I have listened to some of these
arguments. The gentlewoman from Ohio [Ms. Kaptur] will speak later. The
gentlewoman knows our trade deficit with Japan. I think it is $70
billion or so; $60 billion, only $60 billion.
Here we have a very sensitive industry. I believe we have spent
something like $5.5 billion on R&D on supercomputing through DOD and
the NSF since 1991 to make sure that we retain our technological edge
in this country. It is a very small industry, very key to our economy,
very key to our national defense. We are told, I heard here a while
ago, that, unless we ignore dumping in this case, that is going to
destroy the American standard of living. That sort of leaves me
confused.
It seems to me that we should make sure on this very crucial, small
industry that the Japanese do not dump a product into our markets,
particularly when it is taxpayer dollars going to purchase it. It seems
to me we should continue on the policy of R&D to make sure we retain
our national edge.
I hear all of these things, how we should be afraid of Japanese
retaliation. The reality is the history of competition in Europe is the
U.S. products win. We have not won in Japan. In 1995, the public
supercomputer procurement market share in Japan: United States, 8
percent; Japanese, 92 percent. Do you think that is because of quality
and cost and price? No; it is not. Our products are the best and the
best price. Procurement by the Government in Japan in 1995, 11,
Japanese; 1, United States. Do you think that is because they had
superior quality and price? No.
So I do not know. Mr. Chairman, I am not a technical expert to make
the judgments on whether they are dumping. All indications are that
they are. This amendment would ask the Department of Commerce to
appropriately make those judgments. If we are, we should not be
spending taxpayer dollars to buy it.
People say: Oh, go through this process, put the computer in, let
them get by with it. Some place, some time later, some tariff may be
applied on a supercomputer. You know, they may not even sell the same
product 1 year from now or 6 months from now.
So the provision in the bill is a good one; this amendment is one we
should overwhelmingly reject.
Mr. VENTO. Mr. Chairman, will the gentleman yield?
Mr. SABO. I yield to the gentleman from Minnesota.
Mr. VENTO. Mr. Chairman, I commend the gentleman for his leadership
role. This is the evolution, this is the last chance to have a
supercomputer company. I heard them talk about the computers sold in
Japan. I wonder how many of them resulted in offsets where we actually
had a transfer of technology in order to sell the product in Japan.
Sixty-six percent of our avionics and electronics are an offset.
Mr. KOLBE. Mr. Chairman, I yield myself 1 minute.
We talked about what this would do to our supercomputer industry,
which is one company: Cray. Let me just tell my colleagues what they
said in a memorandum to their own employees just a month ago in which
they said, it is a Q and A kind of memorandum.
Question. How much of an impact does the entire deal have on Cray
financially and in terms of jobs?
Answer. It is a large procurement, but we as a company do not live or
die by one deal. It does not make or break our revenue goals for the
year, and it does not really make a difference in employment because we
do not staff up prospectively for business that is not booked yet.
Mr. Chairman, this is not going to make or break Cray; they are doing
very well in Japan. Let us not jeopardize the sales of computers that
they have in Japan. Let us not jeopardize this with the kind of action
that is being talked about here today. Let us not jeopardize this by
violating our own law our law makes it clear that you can only have a
sanction after there is a final determination of dumping, and then it
can only be in the form of an antidumping tariff, not in terms as
proposed by section 421. It violates our dumping laws, and our
procurement costs.
Mr. OBEY. Mr. Chairman, I yield myself 1 minute simply to say that I
think the gentleman ought to consider what is happening today, not in
the deep, dark, distant past.
My colleague talks about the wonderful performance of the Japanese in
purchasing American supercomputers. If we read Foreign Trade Barriers,
1996 national trade estimate report on foreign trade barriers put out
by the U.S. Trade Representative, we will see the following:
The positive trend in Japanese government supercomputer
procurement witnessed in fiscal year 1993 and 1994 was
reversed in 1995 during which U.S. firms won only 1 of 11
Japanese government procurements. Moreover, the United States
has serious concerns about the conduct of the procurement
process in two specific procurements.
I would suggest that hardly suggests to me that the Japanese are
about to turn over a new leaf.
Mr. VENTO. Mr. Chairman, will the gentleman yield?
Mr. OBEY. I yield to the gentleman from Minnesota.
[[Page H6911]]
Mr. VENTO. Mr. Chairman, I just think it points right out to this
offset agreement where they demand that the product, not just that they
transfer the technology and then they produce it and then the next
thing you know they are selling it back to us, our own technology,
except that it has a Japanese label on it.
Mr. OBEY. Mr. Chairman, I yield 4\1/2\ minutes to the gentlewoman
from Ohio [Ms. Kaptur].
Ms. KAPTUR. Mr. Chairman, I thank the gentleman for yielding me this
time and rise in very strong support of the committee bill and oppose
the Kolbe amendment, which was defeated in the full committee.
The language in the bill is fair, it is reasonable, and without
question it is in our national interest.
The issue here really is why should we not as lawmakers ensure that
the bidding process in this Government procurement activity is
conducted in a fair manner at fair value offers. That is all it says.
It is somewhat curious, although it is not curious to those who have
watched Japan over the years, that for a system that should cost
somewhere between maybe $80 million and $100 million, the bid comes in
at $35 million. Kind of interesting the way Japan behaves on the
international market.
Mr. Chairman, if we go and read a recent book by the President's
chief economic advisor, Laura Tyson, and I do not think she knew we
would be debating this, but in her book, ``Who's Bashing Whom,'' she
gives us a window on what Japan really does and how they compete, and I
quote directly.
She says:
At the root of the ability of Japanese firms to compete
aggressively on price, even when it means selling products
below cost and running losses, are the unique structural
features of the Japanese economy. The companies competing
with--U.S. firms like--Cray and Motorola have deep pockets
and long time horizons. They can afford to cross-subsidize
losses in one market with profits from another. They continue
to benefit from a variety of promotional policies and from
lax enforcement of regulations or restrictive business
practices. They also continue to benefit from the insulated
nature of the Japanese market, fostered by these and other
structural impediments. In short, the pricing behavior of
Japanese companies is a natural outgrowth of Japan's business
and government environment.
We know it is a protected environment. There is not a person in this
institution that would call Japan a free trader.
I know that the gentleman from Arizona [Mr. Kolbe] is a complete free
trader. I am a fair trader. There is no way anybody could call Japan a
free trader.
Now, if we look at this particular market, and I can still remember
Norm Mineta when he served here laboring over those agreements with
Japan trying to get 5-percent access in the market, 10-percent access,
maybe 12 percent, and then Japan would violate those agreements. There
is not any question Japan has a habit well recognized of underbidding
in almost every market.
Look at what they did to us on the airport, the new airport out
there, Osaka. We could not get U.S. firms to be able to bid into that
construction.
So it is not just in supercomputers. It is in construction. It
certainly is in the automotive industry. The results are painfully
clear to the American people if they are not painfully clear to every
Member of Congress here. That is we have maintained a $50 billion to
$60 billion trade deficit now, annually, annually, in this decade
growing every year regardless of what the exchange rate is.
I remember one of my dear friends, the gentleman from Florida, Sam
Gibbons, said to me: Well, if only the exchange rate, U.S. dollar to
the yen, would go down from 240 to maybe 250 yen to the dollar. Why, we
could just crack the Japanese market.
You know what? It never happened. And then the yen went down to 90,
and the trade deficit kept going up. It does not matter whether Japan
has got pneumonia or whether she is the most strident economy on the
face of the earth in any given year. The trade deficit just keeps going
on.
I would just have to say, let us wake up. Let us wake up. Let this
Congress not be bound up in legalisms and procedures that we knot
ourselves up into. Let us look at the bottom line, and let us do
everything we can in order to ensure that the bidding practices in this
situation are completely fair.
In many ways, supercomputers translate into national security. Let us
not be naive. Support the committee bill. Oppose the Kolbe amendment,
and stand up, for a change, for fair bidding practices.
{time} 1830
Mr. KOLBE. Mr. Chairman, I yield myself 30 seconds.
Mr. Chairman, I listened to the gentlewoman from Ohio and I assume
she believes that dumping is taking place in this case. I do not know
if that is a fact or not. But if it is, there is a process to be
followed. You file an antidumping case, you make a determination, you
make a determination of the injury, and then you impose a sanction. The
sanction is an antidumping tariff. I do not understand why the
gentlewoman and other people over there are not willing to follow the
law, the law that we voted on, that we adopted here.
Mr. Chairman, I yield 2 minutes to the gentleman from Colorado [Mr.
Skaggs].
Mr. SKAGGS. I thank the gentleman for yielding me some additional
time.
Mr. Chairman, again I think all parties to this debate would
stipulate that we are not going to buy anything with taxpayer money
that we know to be priced unfairly. We are not going to ignore dumping.
There is a regular order to be followed in dealing with those cases
when they arise. We do not know if this is one of those cases or not.
Contrary to comments that have been made earlier by the gentleman
from Minnesota, all indications are not that we have a dumping case.
The only indication that we have one is that very sloppily done
predetermination made by the Department of Commerce contrary to the
regular procedures that are supposed to apply. They basically put this
through a black box and came out with an answer that nobody is able to
review or scrutinize against any known standard. So we are really
boxing against a sort of mythic opponent here.
What the regular Department of Commerce process prescribed by law
requires is a very rigorous, very open process on the record with
extensive filings of documentation of costs and pricing that the whole
world can look at and scrutinize and analyze, that is subject to
technical review, not in this kind of a very unfortunate circumstance.
That is the way that we need to proceed.
If we want this aspect of our trade law to be different and if we
want it to be handled differently, then we need to go through the
process of changing the law and renegotiating our international trade
agreements. We cannot make policy on this in an ad hoc, case-by-case
basis, when something high profile like this jumps up and grabs our
attention. It will not serve the national interest in the long haul to
proceed in this fashion.
Mr. OBEY. Mr. Chairman, I have only one remaining speaker and I
understand we have the right to close.
The KOLBE. Mr. Chairman, I yield 30 seconds to the gentleman from
California [Mr. Campbell].
Mr. CAMPBELL. Mr. Chairman, just one point: What does this amendment
provide? It removes the language by the gentleman from Wisconsin. That
language does not say what was reported in the colloquy between the
gentleman from Wisconsin and the gentleman from Minnesota, that the NSF
may not buy this computer if dumping is found by the Commerce
Department. What it says is that NSF cannot go ahead if there has been
a ``preliminary'' or a ``final'' determination of dumping. The whole
difference here is if the dumping finding is just preliminary and not
final. If it is only a preliminary finding, it violates our
international obligations to impose sanctions.
Mr. KOLBE. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, let me just reiterate a couple of points here. There is
a process that we have adopted that must be followed when we believe
dumping is taking place. The process requires the industry or the
Department of Commerce to initiate an antidumping case. The
International Trade Commission then makes an initial determination of
injury. The full investigation is then done by the Department of
Commerce.
[[Page H6912]]
It goes back to the International Trade Commission for ratification and
for the imposition of an antidumping tariff. That is the process. That
is the law.
As the gentleman from Colorado so aptly put it, we ought not to be
engaging in ad hoc changes to our entire law as it relates to
procurement, dumping, and international agreements. We should not be
jeopardizing our supercomputer industry. Any foreign country would have
a perfect case against us when we violate the law and violate our
international agreements in this fashion to block the sale of
supercomputers overseas. If people believe that we should have a
process of protecting ourselves, then they should adopt that process
and follow it. If the process is not right, change the process.
Mr. Chairman, I yield back the balance of my time.
Mr. OBEY. Mr. Chairman, I yield myself 4 minutes.
Mr. Chairman, let me say I respect the arguments being made by both
sides. This is legitimate debate. I simply want to make a few points to
refute what has been alleged by the amendment's sponsors.
I want to repeat, this bill does not say that we cannot buy this
computer. What it says is that if there is either a preliminary or a
final determination by the Commerce Department that this constitutes
dumping by the Japanese, that then that computer cannot be purchased.
The reason it is worded that way is very simple: It can take up to a
year to reach a final determination, whereas a preliminary
determination, which has not yet been made, if a preliminary
determination is reached it usually takes about 4 months.
The problem with waiting over a year and the problem of doing what
the gentleman from Arizona wants us to do, and simply rely on the post-
fact additional tariff if there is found to be dumping, is that that
suits the situation if we are talking about consumables. But if we are
talking about an industry such as the supercomputer industry, which is
so integral to the defense of this country and to the national welfare,
if we simply allow a Japanese company which has already demonstrated it
is willing to sell every supercomputer they sell at a loss, then they
are certainly willing to eat the additional tariff that would be
imposed upon them in order to break the supercomputer market in this
country and to eventually drive American supercomputer producers out of
business.
We used to have 15 American supercomputer producers. We were down to
5. Two of them got out of business. There are really only three
companies left in this country who produce anything that can be called
close to the supercomputer and only one, Cray, which is still left
fully standing. They will not be standing for very long if we allow the
Japanese to continue this predatory pricing of theirs.
I want to make the point: we have signed no agreement that requires
us to buy dumped products. We have signed an agreement to require open
and transparent trading, but that was never meant to serve as a cover
for predatory pricing of products.
We could have done, as I said, as has already been done on the
defense bill, simply say these computers cannot be bought, period. I
did not hear anybody object to that. But we took the more modest
approach of simply saying if a determination is reached by the Commerce
Department, then that supercomputer shall not be purchased with
American tax dollars, because these dollars are appropriated to expand
and to maintain the American preeminence in this field, and yet they
are ironically being used to undercut that preeminence. All we are
saying is if they reach that determination, then we cannot buy this
supercomputer. That is all we are asking to do.
I would make the point that it ought to be obvious that if those
Japanese corporations have never made a profit on the sale of a
supercomputer, it is obvious that they are not after profit. They are
looking at their long-term ability to bust the U.S. lead, break into
our market and eventually drive our short-pocket companies out of
business. I do not think that is in the interest of the United States.
I appreciate the bipartisan support for the action taken by the
committee, and I would urge that the committee uphold the judgment of
the committee.
Mr. SKAGGS. Mr. Chairman, I ask unanimous consent that each side have
2 additional minutes in this debate so as to accommodate the body
hearing from the gentleman from Illinois [Mr. Crane].
The CHAIRMAN. Is there objection to the request of the gentleman from
Colorado?
Mr. OBEY. Mr. Chairman, I must respectfully object. I was asked to
agree to a time limit. I have the right to close. Now we are being
asked to violate that process. I really do not think that is fair.
The CHAIRMAN. Objection is heard.
Mr. OBEY. Mr. Chairman, if I could reserve the right to object, I
would be happy to give the gentleman 2 minutes to speak if I could be
assured that we will still have the right to close.
Mr. KOLBE. If the gentleman will yield, that was the unanimous-
consent request, 2 minutes on each side.
The CHAIRMAN. The gentleman from Wisconsin would still have the right
to close if there was an extension on both sides of 2 minutes.
Mr. OBEY. Mr. Chairman, if that is the case, then I withdraw my
reservation of objection.
The CHAIRMAN. Is there objection to the request of the gentleman from
Colorado?
There was no objection.
The CHAIRMAN. The Chair recognizes the gentleman from Arizona [Mr.
Kolbe].
Mr. KOLBE. Mr. Chairman, I yield my 2 minutes to the gentleman from
Illinois [Mr. Crane], the distinguished chairman of the Subcommittee on
Trade of the Committee on Ways and Means.
Mr. CRANE. I thank my colleague for yielding this time, and I want to
thank my distinguished colleague from the neighboring State of
Wisconsin for accommodating us.
Mr. Chairman, I rise today in support of the amendment offered by my
colleague, the gentleman from Arizona [Mr. Kolbe], to strike section
421 from the bill. I am greatly concerned that section 421 would force
an independent government agency to turn down the NEC computer in
question, even though neither the Department of Commerce nor the
International Trade Commission has made any formal findings of dumping
and injury, and in fact has not initiated any formal investigation, as
required by statute and by international law, to impose antidumping
duties.
Clearly we must enforce our antidumping laws to prevent unfair
trading. However, section 421 would improperly use the appropriations
process to chill what could be a legitimate procurement that does not
involve dumping. It is impossible for Congress to determine now whether
the procurement in question violates the antidumping statute. That is a
matter for the Commerce Department and the International Trade
Commission to determine, using statutorily mandated procedures. Only
when they have made this determination can we begin to consider the
effects on the procurement.
In addition, I am greatly concerned that such language could violate
our obligations under the WTO antidumping agreement, which provides
that no specific action against dumping of exports from another party
may be taken except in accordance with the agreement, and does not
authorize punitive measures such as disqualification from government
procurement.
In addition, I am concerned that the amendment could violate the
Government Procurement Agreement, which provides that each party shall
provide national treatment to suppliers of other parties. The Japanese
government has already notified our government of their concerns that
we would be violating our international obligations if this provision
is adopted.
The United States is the largest target of foreign antidumping
actions. We are vulnerable. What we do to other countries will be done
to us. Accordingly, I would urge all Members to support the Kolbe
amendment.
The CHAIRMAN. The gentleman from Wisconsin has 3 minutes remaining.
Mr. OBEY. Mr. Chairman, I yield myself 2 of those minutes.
Mr. Chairman, I simply want to repeat again, there is no violation of
law and there is no violation of our trade
[[Page H6913]]
agreements by the action taken by the committee. NCAR is not an agency
of the Government. Article 3 of the Government Procurement Agreement
does not apply to the proposed legislation because article 1 of the
agreement states that the agreement covers procurements only by those
entities listed in the agreement's appendices.
{time} 1845
Neither ENCAR nor UCAR are among those listed entities. But having
put that technical argument aside, I simply want to make this point.
The only argument that is being made by the folks who are opposed to
the committee action is that it is one of process.
As the gentleman from New York [Mr. Houghton] has pointed out, we
have lawyers on both sides of the argument making opposite arguments,
and they will continue to do so. Our job is to cut through that and
recognize that tonight what is important is that we defend the national
interest of the United States. I repeat, we are not making a judgment
that this supercomputer cannot be bought and we are not making a
judgment that it is being dumped, although it is pretty hard to see why
it is not when they are offering to provide a supercomputer worth $90
to $110 million for a $35 million price because they want so badly to
bust into the United States market.
But I simply want to repeat, despite that fact, we are not
determining that this computer at this point is being dumped. All we
are saying is that if the Commerce Department reaches that conclusion,
then, because this industry is so crucial, not only to the defense
capability of this country but to the long-term economic viability of
this country, it is important that we not allow legalisms to bind us to
a requirement that if the Japanese corporation is willing to eat
another $70 or $100 million tariff, that they would be allowed to use
trade agreements to destroy our economy. That is all we are saying.
Mr. Chairman, I yield such time as he may consume to the gentleman
from California [Mr. Lewis].
Mr. LEWIS of California. Mr. Chairman, I very much appreciate the
gentleman yielding. He has done so in order for me to have a colloquy
with the gentleman from Arizona [Mr. Kolbe].
Mr. Chairman, I very much appreciate the cooperation of the gentleman
from Wisconsin [Mr. Obey] in that regard.
Mr. KOLBE. Mr. Chairman, will the gentleman yield?
Mr. LEWIS of California. I yield to the gentleman from Arizona.
Mr. KOLBE. Mr. Chairman, I would just ask the gentleman from
California [Mr. Lewis] to enter into a colloquy.
I think the gentleman has heard the very legitimate concerns that
have been expressed about the possibility of antidumping. The gentleman
has also heard the concerns on this side about the possible violations
of law that may be involved here on the possible changes to our law.
I am just wondering if the gentleman can assure me that if this issue
gets into the conference that this will be considered very carefully in
the context of what might be done by the Senate and with the debate
that has taken place here today.
Mr. LEWIS of California. Reclaiming my time, I can say to the
gentleman we have had a very thorough discussion in our full committee
and here on the House floor. There is no question that the gentleman
from Wisconsin [Mr. Obey] has a serious point that he wants to make. He
has made that point very well. Between now and conference, there is not
any question that we will continue to consider the result of this and
it will be discussed thoroughly in conference.
Mr. KOLBE. Mr. Chairman, with that proviso, I ask unanimous consent
to withdraw the amendment.
The CHAIRMAN. Is there objection to the request of the gentleman from
Arizona?
There was no objection.
_______________________________________________________________________
N O T I C E
Incomplete record of House proceedings. Except for concluding business
which follows,
today's House proceedings will be continued in the next issue of the
Record.
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