[Congressional Record Volume 142, Number 123 (Tuesday, September 10, 1996)]
[House]
[Pages H10157-H10167]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 EXPORTS, JOBS, AND GROWTH ACT OF 1996

  Mr. ROTH. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 3759) to extend the authority of the Overseas Private Investment 
Corporation, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 3759

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Exports, Jobs, and Growth 
     Act of 1996''.

            TITLE I--OVERSEAS PRIVATE INVESTMENT CORPORATION

     SEC. 101. INCOME LEVELS.

       Section 231 of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2191) is amended in paragraph (2) of the second 
     undesignated paragraph--
       (1) by striking ``$984 or less in 1986 United States 
     dollars'' and inserting ``$1,280 or less in 1994 United 
     States dollars''; and
       (2) by striking ``$4,269 or more in 1986 United States 
     dollars'' and inserting ``$5,556 or more in 1994 United 
     States dollars''.

     SEC. 102. CEILING ON INVESTMENT INSURANCE.

       Section 235(a)(1) of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2195(a)(1)) is amended by striking ``$13,500,000,000'' 
     and inserting ``$25,000,000,000''.

     SEC. 103. CEILING ON FINANCING.

       Section 235(a)(2)(A) of the Foreign Assistance Act of 1961 
     (22 U.S.C. 2195(a)(2)(A)) is

[[Page H10158]]

     amended by striking ``$9,500,000,000'' and inserting 
     ``$20,000,000,000''.

     SEC. 104. ISSUING AUTHORITY.

       Section 235(a)(3) of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2195(a)(3)) is amended by striking ``1966'' and 
     inserting ``2001''.

     SEC. 105. POLICY GUIDANCE.

       Section 231 of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2191) is amended in the first paragraph--
       (1) by striking ``To mobilize'' and inserting ``To increase 
     United States exports to, and to mobilize'';
       (2) by striking ``of less developed'' and inserting ``of, 
     less developed''; and
       (3) by inserting ``trade policy and'' after ``complementing 
     the''.

     SEC. 106. BOARD OF DIRECTORS.

       Section 233(b) of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2193(b)) is amended--
       (1) by striking the second and third sentences;
       (2) in the fourth sentence by striking ``(other than the 
     President of the Corporation, appointed pursuant to 
     subsection (c) who shall serve as a Director, ex-officio)'';
       (3) in the second undesignated paragraph--
       (A) by inserting ``the President of the Corporation, the 
     Administrator of the Agency for International Development, 
     the United States Trade Representative, and'' after 
     ``including''; and
       (B) by adding at the end the following: ``The United States 
     Trade Representative may designate a Deputy United States 
     Trade Representative to serve on the Board in place of the 
     United States Trade Representative.''; and
       (4) by inserting after the second undesignated paragraph 
     the following:
       ``There shall be Chairman and a Vice Chairman of the Board, 
     both of whom shall be designated by the President of the 
     United States from among the Directors of the Board other 
     than those appointed under the second sentence of the first 
     paragraph of this subsection.''.

                 TITLE II--TRADE AND DEVELOPMENT AGENCY

     SEC. 201. TRADE AND DEVELOPMENT AGENCY AUTHORIZATION.

       Section 661(f)(1)(A) of the Foreign Assistance Act of 1961 
     (22 U.S.C. 2191(f)(1)(A)) is amended to read as follows:
       ``(1) Authorization.--(A) There are authorized to be 
     appropriated for purposes of this section, in addition to 
     funds otherwise available for such purposes, $40,000,000 for 
     fiscal 1997, and such sums as are necessary for fiscal year 
     1998.''.

  TITLE III--EXPORT PROMOTION PROGRAMS WITHIN THE INTERNATIONAL TRADE 
                             ADMINISTRATION

     SEC. 301. EXPORT PROMOTION AUTHORIZATION.

       Section 202 of the Export Administration Amendments Act of 
     1985 (15 U.S.C. 4052) is amended to read as follows:

     ``SEC. 202. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to the Department 
     of Commerce to carry out export promotion programs 
     $240,000,000 for fiscal year 1997 and such sums as are 
     necessary for fiscal year 1998.''.

            TITLE IV--TRADE PROMOTION COORDINATION COMMITTEE

     SEC. 401. STRATEGIC EXPORT PLAN.

       Section 2312(c) of the Export Enhancement Act of 1988 (15 
     U.S.C. 4727) is amended--
       (1) by striking ``and'' at the end of paragraph (4);
       (2) by striking the period at the end of paragraph (5) and 
     inserting a semicolon; and
       (3) by adding at the end the following:
       ``(6) identify means for providing more coordinated and 
     comprehensive export promotion services to, and in behalf of, 
     small- and medium-sized businesses; and
       ``(7) establish a set of priorities to promote United 
     States exports to, and free market reforms in, the Middle 
     East that are designed to stimulate job growth both in the 
     United States and the region.''.

     SEC. 402. IMPLEMENTATION OF PRIMARY OBJECTIVES.

       The Trade Promotion Coordinating Committee shall--
       (1) identify the areas of overlap and duplication among 
     Federal export promotion activities and report on the actions 
     taken or efforts currently underway to eliminate such overlap 
     and duplication;
       (2) report on actions taken or efforts currently underway 
     to promote better coordination between State, Federal, and 
     private sector export promotion activities, including co-
     location, cost-sharing between Federal, State, and private 
     sector export promotion programs, and sharing of market 
     research data; and
       (3) by not later than September 30, 1997, include the 
     matters addressed in paragraphs (1) and (2) in the annual 
     report required to be submitted under section 2312(f) of the 
     Export Enhancement Act of 1988 (15 U.S.C. 4727(f)).

     SEC. 403. PRIVATE SECTOR DEVELOPMENT IN THE UKRAINE.

       The Trade Promotion Coordinating Committee shall include in 
     the annual report submitted in 1997 under section 2312(f) of 
     the Export Enhancement Act of 1988 (15 U.S.C. 4727(f)) a 
     description of the activities of the departments and agencies 
     of the Trade Promotion Coordinating Committee to foster 
     United States trade and investment which facilitates private 
     sector development in the Ukraine.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Wisconsin [Mr. Roth] and the gentleman from Minnesota [Mr. Peterson] 
each will control 20 minutes.
  The Chair recognizes the gentleman from Wisconsin [Mr. Roth].
  Mr. ROTH. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the title of this bill really says it all: exports, 
jobs, and growth. This is legislation that every Member can and should 
support. This is essential legislation.
  Our bill reauthorizes three export agencies. They are the Overseas 
Private Investment Corporation, the Trade and Development Agency, and 
the U.S. Foreign Commercial Service. Each of these agencies is vital to 
U.S. exporters.
  That is why our bill is supported by a broad national coalition of 
business leaders, exporters, and labor groups. We have some 15 
different labor groups also backing this legislation. We have everyone 
from the Chamber of Commerce and NAM to the AFL-CIO.
  Why have American businesses and American labor joined together in 
support of this bill? The real reason is that it creates jobs, good-
paying jobs for our American workers.
  Let me review the facts. OPIC provides the insurance and financing 
necessary for American companies to expand into the newly emerging 
markets in Eastern Europe, Asia, and Latin America. OPIC has generated 
$43 billion in exports. That translates into 200,000 jobs for American 
workers, 200,000 because of this one piece of legislation.
  Our bill provides a 5-year plan to allow OPIC to grow, to serve more 
American exporters, and to add even more jobs for American workers.
  OPIC does all of this without tossing one red cent to the American 
taxpayer. Let me repeat that again because there is a lot of 
misinformation and disinformation about this legislation by people who 
want to demagogue the legislation.
  This legislation has not cost the American taxpayer one red cent. In 
fact, it has put into the American Treasury $2\1/2\ billion, and if 
this bill passes, if my colleagues join me in passing this legislation, 
we are going to add, as our placard says, $189 million every year to 
the U.S. Treasury for the next 5 years.
  That is a replica of the check that was given to the U.S. Treasury by 
OPIC. OPIC is going to have some $5 billion in the U.S. Treasury in 5 
years, and it is not going to cost the American taxpayer one single 
cent.
  As we can see, on our chart the total exports that are going to be 
increased by this legislation are over $38 billion. The amount of jobs 
that are created, additional jobs in the next 5 years, are over 123,000 
jobs.
  This is a good piece of legislation, and I am asking my colleagues, I 
am appealing to their reason, not to their emotion, I am appealing to 
their reason to pass this legislation, yes, for our workers and for our 
companies, but also for the people in Latin America, some of the people 
in Africa, and in the Third World and also in Eastern European 
countries that we are trying to help. This legislation is going to put 
$2\1/2\ billion additional into the U.S. Treasury in the next 5 years, 
it is going to create over $38 billion in exports, and it is going to 
create over 123,000 jobs. Again I am appealing to my colleagues' reason 
to pass this legislation.
  Mr. PETERSON of Minnesota. Mr. Speaker, we have a very diverse group 
that is opposing this bill. I would like to start off today by yielding 
such time as he may consume to the gentleman from Ohio [Mr. Kasich], 
the distinguished chairman of the House Committee on the Budget.
  Mr. KASICH. Mr. Speaker, I think one of the best days that we had on 
this House floor during my 14 years in Congress was the day in which we 
reformed the welfare system in this country. We said that there should 
not be giveaway programs, that people in fact ought to go to work. 
Well, it was with great effort and with great inspiration that we moved 
forward to pass a bill to reform the welfare system in America as it 
relates to the poor, but now this is welfare Step Two.
  This is now an effort to reform a welfare system that exists in 
America that does not benefit people who are poor. This is a welfare 
system that we have created in America that provides welfare to the 
rich and welfare to the well off.

[[Page H10159]]

  Now let me just talk a little bit about the Overseas Private 
Investment Corporation and tell my colleagues that the people who are 
lined up against this bill come all the way from the left to the right. 
It is one of the most diverse coalitions I have ever seen in the House 
of Representatives, and I would like to talk about a few of the people 
who do know a little bit about economics and what they have to say 
about this program.
  Milton Friedman, one of the foremost leading experts in economics in 
the world, had a comment that he wanted to make on OPIC. He said: I 
cannot see any redeeming aspect in the existence of OPIC. It is special 
interest legislation of the worst kind.
  That is Milton Friedman from the Chicago School of Economics.
  The National Taxpayers Union says that few other Federal programs can 
combine such undesirable elements as corporate welfare, wasteful 
spending, unneeded foreign aid, mismanagement and risk to taxpayers 
into one package, in referring to the Overseas Private Investment 
Corporation.
  Now, when we take the National Taxpayers Union and Milton Friedman 
all saying that this program is a boondoggle, what are we attempting to 
do here today? Well, what we are attempting to do here today is not 
just to keep the Overseas Private Investment Corporation, which makes 
loans and loan guarantees and provides insurance out of the taxpayers' 
pocket to the largest corporations in America overwhelmingly, but now 
they want to come back and double, and double the amount of lending 
authority and risk-taking that they have as proposed in this 
legislation.

                              {time}  1700

  This is not just a continuation of a dubious program like OPIC, but 
frankly, it is a doubling of the amount of risk the taxpayers are being 
asked to burden.
  Let me just tell the Members a little bit about OPIC. We hear about 
it and we hear about all the jobs that are created. The gentleman from 
New Jersey [Mr. Andrews] did an analysis, loan by loan and jobs by 
jobs. The Overseas Private Investment Corporation could never connect 
the loans that are being made to these giant corporations to the 
creation of American jobs in this country.
  The gentleman from New Jersey [Mr. Andrews] wrote into the law a 
provision that said that the Overseas Private Investment Corporation 
ought to trace the loans directly to the creation of jobs, and that 
organization has failed to do so. They have failed to do so because, 
frankly, the numbers that get thrown around on the creation of jobs are 
dubious at best. Let me tell the Members about some of the projects 
that the Overseas Private Investment Corporation invests in, using 
taxpayer money and taxpayer-funded risk insurance.
  We developed a soft drink bottling company in Poland and in Ghana, a 
travel agency in Armenia. We have magazine publishing in Russia, a 
lumber mill in Lithuania, a shrimp farm in Ecuador, probably a jumbo 
shrimp farm, but a shrimp farm in Ecuador, pension management in 
Colombia, a hotel in the Ukraine, and restaurants in Argentina, 16 
restaurants in Argentina.
  Here we have a host of investments that are going on overseas, not 
inside the United States, but overseas, financed by taxpayers and 
insured by taxpayers. Let us talk about the portfolio. We asked the 
Congressional Budget Office to give us a list of the quality of the 
portfolio; in other words, what kind of risk-taking is the OPIC 
investing in?
  As Members can see when we look at the rating in fiscal 1995, the 
OPIC is consistently using the taxpayers' money to give large 
corporations the ability to take risks in operations that are defined 
with a D minus credit rating, an F double negative credit rating.
  If you went into a bank, if you were a taxpayer in America and walked 
into a bank to get a loan to buy a house and you said to a banker that 
``I have an F double negative rating,'' they would throw you out of 
the bank. But the Overseas Private Investment Corporation can march 
into these countries and they can get loans from the taxpayers, 
hardworking taxpayers, and then they can have those loans insured by 
hardworking taxpayers, the same taxpayers who do not have a prayer of 
securing a loan in regard to these kinds of credit ratings.

  If we want to continue to debate this whole Overseas Private 
Investment Corporation, which, frankly, is welfare for the largest and 
most profitable corporations in this country, that is fine, we can 
debate it. But to come to this floor and argue that we ought to double 
the amount of loans and double the amount of risk-taking on the backs 
of the American taxpayers is wrong.
  I would urge my colleagues to not permit, to not approve of a 
tremendous expansion in this program, when this Congress is engaged in 
trying to slow the growth of government. How much sense does it make to 
allow the largest corporations to use our money to invest in these 
kinds of investment opportunities that, in a normal American bank, you 
would not have a prayer of getting a loan. Let us defeat this Overseas 
Private Investment Corporation, take it back to the shop, try to fix 
the thing, and frankly, Mr. Speaker, try to phase it out. Less 
government is the motto of Congress.
  Mr. ROTH. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, we just heard the gentleman from Ohio speak for 6 
minutes and he did not say anything.
  The truth of the matter is this program has not cost the American 
taxpayer one cent. In fact, there is $2.5 billion in the U.S. Treasury 
because of this program, and it will increase to $5 billion in 5 years. 
Those are the facts. That is not a bunch of demagoguery.
  Mr. Speaker, I yield 5 minutes to my friend, the gentleman from 
Indiana [Mr. Hamilton].
  Mr. HAMILTON. Mr. Speaker, I thank the gentleman for yielding time to 
me.
  Mr. Speaker, I certainly rise in support of H.R. 3759. I want to 
speak a word of appreciation to the gentleman from Wisconsin, Mr. Roth, 
and the gentleman from Connecticut, Mr. Gejdenson, Mr. Roth, the 
chairman of the Subcommittee on International Economic Policy and 
Trade, and Mr. Gejdenson, the ranking minority member, for their very 
excellent work in producing this legislation.
  All of these agencies that are involved here, the Overseas Private 
Investment Corporation and the Trade and Development Agency and the 
Internationational Trade Administration, are very cost-effective and 
very excellent organizations. They receive uniformly high marks from 
the people who know them best, their clients, the thousands of firms 
and workers whose exports they promote. The demand for the services of 
these groups keeps rising.
  Let me just take a moment to respond to some of the charges that are 
made against OPIC. The usual charge is that this is corporate welfare. 
The fact of the matter is, however, that the programs here are fully 
paid for by the fees and the premiums it charges customers and by the 
interest that it has earned on the reserves. There is no welfare here. 
There is no drain on the taxpayers' dollars here.
  The charge of corporate welfare is simply wrong. It is misguided. 
Corporate welfare would be an appropriate label if OPIC gave away 
something for free, but it does not. The programs are fully paid for by 
the corporations which participate through fees and through premiums. 
OPIC, as the gentleman from Wisconsin has pointed out, is of enormous 
benefit to the U.S. economy. Since 1971, it has generated $40 billion 
in exports. That means profits for companies, and it means jobs for 
American workers. The estimate is that it has supported about 200,000 
jobs in this country. That explains why OPIC has the support not just 
of corporate America, but also for the union movement.
  If there were in fact corporate welfare, does anybody in this Chamber 
believe that the American union movement would support it? Of course, 
they understand that they get jobs from it. So some critics say the 
foreign investment by OPIC costs American jobs, but OPIC is forbidden 
by law to back any foreign projects that are likely to adversely affect 
U.S. jobs and exports.
  In addition, OPIC supports U.S. foreign policy interests. That is an 
important point to make her. Not only does it produce more jobs in this 
country, not only does it produce more profits,

[[Page H10160]]

not only is it not corporate welfare or any drain on the taxpayers' 
money, but OPIC supports American foreign policy interests. It uses the 
genius of the American private sector to promote the development of 
market economies in former Communist and other countries. It generates 
jobs and exports and growth in countries whose economic success is in 
our national interest. And, as has been pointed out, it helps reduce 
the Federal budget deficit.
  The user fee, the premium, the interest earnings have enabled OPIC to 
turn over a profit to the United States Treasury every year of its 
existence. OPIC expects to contribute another $900 million to deficit 
reduction in the next 5 years. And OPIC has proven to be a safe 
investment for U.S. tax dollars. It has over a $2.5 billion reserve to 
cover loan defaults and insurance payouts. Yet, OPIC has historically 
paid claims for only 1 percent of the insurance it is provided, and 
fewer than 5 percent of the loans have defaulted.
  OPIC does things for American exports and foreign policy that no 
private sector entity can do. It supports projects in places that are 
important to the United States, but where private firms are not ready 
to go. OPIC's unbroken record of profitability shows it can provide 
that support and still remain financially sound. This is a very small 
but very valuable agency. It has earned our support for more than two 
decades. It does not approach any definition of corporate welfare, and 
it deserves our continued support toady.
  Mr. PETERSON of Minnesota. Mr. Speaker, I am pleased to yield 4 
minutes to the gentleman from Illinois [Mr. Jackson], one of our newer 
Members.
  Mr. JACKSON of Illinois. Mr. Speaker, I thank the gentleman from 
Minnesota for yielding time to me. Mr. Speaker, I rise today in strong 
opposition to H.R. 3759, a contentious bill which in my opinion is 
incorrectly being considered by the House today under suspension of the 
rules, a procedure normally reserved for noncontroversial measures. 
Just before we broke the August work period, a majority in this body 
voted to end Aid to Families with Dependent Children. This bill today 
will, in effect double one means of providing Aid to Dependent 
Corporations--the Overseas Private Investment Corporation--an agency of 
the Federal Government which provides welfare to America's largest 
corporations.
  OPIC bestows corporate welfare upon multinational corporations 
through direct loans, subsidized loan guarantees, and political risk 
insurance. Secured by U.S. taxpayer dollars, OPIC provides American 
Fortune 500 companies with the incentive to enter into risky 
transactions from which conventional lenders have shied away. With the 
full faith and credit of the U.S. Government backing up their business 
ventures, OPIC's corporate clients have eliminated thousands of 
American jobs. With the destabilizing effects of corporate downsizing 
on American workers and their families, we should not be providing 
incentives for America's corporate giants to invest abroad, taking 
advantage of low-wage labor costs, lower standards, and often 
exploitive working conditions of Third World countries, rather than 
reinvesting and creating good jobs at home. We need to raise their 
standards toward ours, not lower ours to meet theirs in this 
increasingly global economy.
  Mr. Speaker, at a time when our Government is calling upon the poor, 
children, and legal immigrants to make sacrifices in the name of 
balancing the Federal budget, I cannot imagine a more inappropriate 
climate in which to reauthorize--and, in fact, double--OPIC's financing 
authority from $9 to $20 billion and insurance ceilings from $13 to $25 
billion. Under good circumstances, OPIC's corporate borrowers yield a 
private profit, boosting their bottomline and the dividends for their 
shareholders. Under bad circumstances, in the event that OPIC's 
multinational corporate borrowers default on their private obligation 
the burden becomes a public one. A private profit and a public loss--
that's socialism for the rich. It is the U.S. taxpayer who will bear 
the burden of the risky or unstable conditions surrounding these 
investments.
  It is true that OPIC has provided a vehicle for promoting investment 
in developing nations and regions previously ignored from projects in 
Sub-Saharan Africa, in Poland and to the now exploding investment 
opportunities in Russia and countries of the former Soviet Union. I 
support foreign aid and direct investment, both private and public, in 
developing nations. But OPIC is a bad vehicle because it privatizes the 
corporate benefits but potentially leaves American taxpayers vulnerable 
to corporate losses.
  Have we not learned anything from the savings and loan debacle of the 
1980's--just because there have not yet been huge losses associated 
with OPIC's investments, as its proponents claim, this does not 
guarantee future good fortune. The same claims of solvency were made by 
FSLIC, the Federal Savings & Loan Insurance Corporation until its 
crisis years. Hindsight is 20/20 one decade and $180 billion in 
taxpayer bailout dollars later.
  OPIC has already placed $8.7 billion of the U.S. taxpayer dollars at 
risk. In 1995, OPIC made loan guarantees to DuPont for $200 million, 
and $165 million for CocaCola; and provided $842 million in investment 
insurance for Citicorp, a company with a net income of $3.5 billion in 
that same year. We cannot continue to underwrite the foreign 
investments of America's largest corporations. In doubling OPIC's 
corporate welfare, we are, in effect, aiding and abetting the 
downsizing of the American work force and the downsizing of the 
American dream.
  Let me be clear * * *  We just ended welfare--Government assistance 
to millions of poor people in our own communities, yet we are providing 
Government assistance to companies to invest in foreign countries. 
Before we take care of people in other countries we must take care of 
our people here at home.
  Imagine what we could do if we invested the $120 million we're 
talking about today to leverage investments in our cities, our 
neighborhoods, and communities. It should not be used to make it easier 
for American companies to invest in Warsaw businesses when Polish-
Americans on the southside of Chicago can't receive the same type of 
assistance.
  Mr. Speaker, from the Congressional Progressive Caucus to the 
centrist Progressive Policy Institute to the conservative Progress and 
Freedom Foundation, opposition to this egregious form of corporate 
welfare spans the political and ideological spectrum. I urge my 
colleagues to end corporate welfare as we know it and vote ``no'' on 
H.R. 3759.

                              {time}  1715

  Mr. ROTH. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, let me just say to my good friend from Illinois who 
spoke that if we want to have jobs for those people we are taking off 
welfare, we have got to have good-paying jobs, and this bill provides 
that.
  Incidentally, the Machinists Union sent me a letter and it says, 
``Contrary to assertions of critics of OPIC, American workers also have 
a stake in OPIC's reauthorization. OPIC should be permitted to continue 
its work in creating jobs for American workers.''
  Not only 1 union but 15 unions, I say to my friend from Illinois. 
Again OPIC has not cost the American taxpayer one red cent.
  Mr. Speaker, I yield 5 minutes to the gentleman from New York [Mr. 
Gilman], the chairman of the Committee on International Relations.
  (Mr. GILMAN asked and was given permission to revise and extend his 
remarks.)
  Mr. GILMAN. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, I rise in strong support of H.R. 3759, the Exports, Jobs 
and Growth Act of 1996. This measure promotes U.S. exports, spurs U.S. 
investment in overseas markets and promotes economic development--all 
at minimal cost to the American taxpayer. It is supported by a broad-
based coalition of 15 business organizations and labor unions and more 
than 150 individual companies.
  Adopted by a voice vote on July 10, 1996, by the International 
Relations Committee, this measure provides a 5-year authorization of 
the Overseas Private Investment Corporation.
  I want to pay tribute to my colleagues on the committee, on both 
sides of the aisle, who have worked long and hard on this legislation.

[[Page H10161]]

  I congratulate the gentleman from Wisconsin, Toby Roth, the 
distingushed chairman of the International Economic Policy and Trade 
Subcommittee, who has taken a leading role in shaping this important 
legislation and bringing it to the House floor this afternoon.
  Founded in 1971, OPIC is a U.S. Government agency that provides 
project financing, investment insurance, and other services for 
American businesses in developing nations and emerging economies.
  Its consideration today is all the more important in so far as its 
operating authority expires on September 30 of this year.
  In its 25-year history, OPIC has supported $43 billion in American 
exports and close to 200,000 jobs while building reserves of some $2.6 
billion. Over the past 2 years for New York State companies alone, OPIC 
has provided insurance and financial support for more than 400 projects 
generating $4.5 billion in American exports and over 9,000 U.S. jobs.
  This is one of the very few U.S. Government agencies that is self-
supporting, returning money every year since its inception. Every 
dollar of its $189 million of net income last year was deposited in the 
U.S. Treasury.
  OPIC has demonstrated an outstanding track record in avoiding claims 
and achieving recoveries: The Political Risk Insurance Program has had 
to pay only 1 percent in claims and has had a recovery rate of 98 
percent.
  In a February 1996 privatization study an outside consultant, J.P. 
Morgan, concluded that OPIC is adequately reserved for the business it 
has on the books and plans for the future.
  This legislation does call for large increases in OPIC's operating 
ceilings for its insurance and finance programs. But these increases 
will be phased in over a time period of 5 years or more. In addition, 
there is a demonstrable need for OPIC programs from American companies 
in all of the emerging markets around the world.

  Furthermore, the Congressional Budget Office, in its review of this 
bill, has concluded that even with these higher limits OPIC will make a 
positive contribution of some $600 million in reducing the size of the 
deficit.
  By requiring OPIC to invest only in U.S. Treasuries, we are in effect 
reducing the amount that the U.S. Treasury has to borrow day-to-day to 
fund the deficit. As a result, the taxpayer benefits from the premiums 
paid by private companies who use OPIC's services. This is corporate 
``workfare'' not ``welfare''.
  The bill also provides a 2-year authorization for the export 
promotion programs of the International Trade Administration of the 
Department of Commerce as well as for the Trade and Development Agency.
  Since its inception in 1981, TDA has provided feasibility studies, 
specialized training grants, and other forms of technical assistance to 
American businesses competing for infrastructure and other industrial 
projects overseas.
  Finally, the bill requires the Trade Promotion Coordinating Committee 
to provide more comprehensive services to small- and medium-sized 
businesses.
  In sum, this bill will support billions of dollars of U.S. exports, 
the creation of thousands of jobs at minimal cost to the taxpayer.
  Accordingly, I urge its immediate adoption.
  Mr. PETERSON of Minnesota. Mr. Speaker, I yield 4 minutes to the 
distinguished gentleman from California [Mr. Royce].
  Mr. ROYCE. Mr. Speaker, we are talking today about the Exports, Job 
and Growth Act of 1996. Whenever supporters give a bill a motherhood 
and apple pie title like that, and who is not against exports, who is 
not for growth and jobs? But it is time to take a hard look when people 
give a title to a bill like that.
  It should be called the doubling OPIC Act. That is what we are doing 
today. We are expanding and doubling a Government agency, the Overseas 
Private Investment Corporation, at a time when many on this floor have 
committed themselves to balancing the budget and encouraging the 
private sector by asking, Is this an appropriate role for government?
  We have heard how OPIC does not give subsidies. We have heard that 
charge. But can anyone tell us how this is true? The fact is that not 
only does OPIC receive operating expenses from the U.S. Government, but 
most importantly what it does is it sells the full faith and credit of 
the U.S. Government. That is what it does.
  Does that sound familiar? That is what the savings and loan industry 
did. It sold the full faith and credit of the U.S. Government.
  Mr. ROTH. Mr. Speaker, will the gentleman yield?
  Mr. ROYCE. I yield to the gentleman from Wisconsin.
  Mr. ROTH. Mr. Speaker, how much money is OPIC going to cost the 
American taxpayer?
  Mr. ROYCE. The answer, if it goes bust, about $25 billion.
  Mr. ROTH. Has it cost the American taxpayer one red cent?
  Mr. ROYCE. Let me respond to that. The savings and loan industry in 
the 1970's did not cost the taxpayer one red cent, but in the 1980's it 
certainly did.
  Mr. ROTH. The gentleman has not answered the question.
  Mr. ROYCE. Let me have my time; then you may have your time.
  Mr. ROTH. The gentleman is yielding to my question, so I thought I 
would ask how much has it cost the American taxpayer. Not one red cent.
  Mr. ROYCE. I just shared with you that it could cost the American 
taxpayer $25 billion because that is what you are putting the taxpayer 
on the hook for.
  Mr. ROTH. That is not true.
  Mr. ROYCE. Because you are ballooning this program up and, yes, it is 
the full faith and credit of the U.S. taxpayer that will be on the 
hook.
  Mr. ROTH. That is not true.
  Mr. ROYCE. There are no free lunches. As I said, this puts the 
American taxpayer on the hook. If we look at the countries that we are 
rating here, that we are insuring, some of them are rated as double F, 
double F by OPIC itself.
  There is no end in sight to OPIC's expansion because OPIC has a good 
racket, because there is market value to Uncle Sam's backing, and that 
means OPIC discourages private sector competition.
  The fact is that the private market in risk insurance will not reach 
its potential as long as OPIC is in business. Just read the recent J.P. 
Morgan report on OPIC. It does not make much of a case that private 
sector competitors are not being crowded out of the business. The J.P. 
Morgan report also says the demand for political risk insurance is 
growing.
  So what is our response here today? Not faith that the market will 
expand to serve this new demand, but instead some say, Let's expand 
OPIC and deter private interests from taking this business.
  There certainly are private alternatives to OPIC's latest and growing 
activity, and that is starting up investment funds for developing 
countries. Today there are hundreds of private developing country 
investment funds. Portfolio money is flooding into the developing 
world, all parts of the developing world.
  Over the last several years several funds have started up to invest 
in Africa, long thought to be out of bounds for investors. Look them 
up, they are listed on the New York Stock Exchange. Individual 
Americans and institutions are buying these funds. So why is OPIC 
involved with the Africa Growth Fund or funds in Poland or Russia? The 
private sector responds; it does not need a government push.
  Last, I will just say, what type of message are we sending to 
developing countries? We rightly preach privatization and the virtues 
of the free market, yet here we have OPIC giving Government subsidies. 
It sends the wrong message to the developing world.
  Mr. ROTH. Mr. Speaker, just let me say so the American people know 
what is going on, there is not one red cent of Federal dollars involved 
in OPIC. OPIC is all private funds.
  Mr. Speaker, I yield 5 minutes to the gentleman from Nebraska [Mr. 
Bereuter].
  Mr. BEREUTER asked and was given permission to revise and extend his 
remarks.)
  Mr. BEREUTER. Mr. Speaker, I rise in strong support of H.R. 3759. 
This legislation does not only deal with OPIC; it reauthorizes some of 
the most important export promotion programs including OPIC, the Trade 
and Development Agency, and the International Trade Administration.

[[Page H10162]]

  I have heard some of my colleagues from Illinois, from Ohio, from 
California speak about this legislation. I would say I have always 
admired my colleague from Ohio. He is articulate. He is tenacious. He 
is also tenacious in holding onto a myth. Somebody has convinced him 
there is corporate welfare here. If you whisper, you shout that word, 
people get frightened. And, like mindless buffaloes, they stampede off 
the cliff or, like lemmings, they march into the sea.
  We have to look out for what is in the best interests of the United 
States and our workers and our exporters. We have heard mention that 
OPIC might default. We have heard the old bugaboo raised about the 
savings and loan institutions. There is not a risk-free environment in 
the world.
  But OPIC has been operating for 25 years. What kind of a record do 
you want? There has been no default. In fact, if you take a look at the 
conference report, I can tell you with verifiable numbers the 
following:
  During the 25 years of its operation, OPIC estimates it has created 
$43 billion in exports to 140 countries. In direct jobs it has created 
at least 200,000 U.S. jobs, and they are good-paying jobs. And 
significantly, it is self-financing. There is no operation fund coming 
out of the U.S. Treasury. Through its own operations, it has funded 
them and it has built up in the process $2.5 billion in reserves to 
cover contingent liability, including deposits at the U.S. Treasury 
which of course we borrow because we are deficit financing government.
  With a net income last year of $189 million, OPIC is able to cover, 
as it has always been, all of its own expenses and set reserves aside 
for insurance and financial risk through its own earnings.
  For the U.S. economy to remain strong and vibrant in the 21st 
century, the U.S. Government must maintain and fund a comprehensive 
national export strategy. Exports currently account for nearly one-
third of our Nation's reach growth. Yet stiff competition from export-
driven economies in East Asia and the export-hungry countries of Europe 
constantly threaten the high-paying American jobs that are generated by 
these exports.
  My colleague from Ohio mentioned the distinguished economist Milton 
Friedman. He is distinguished, but he is certainly not in the middle of 
the mainstream in the economists of the world or even the United 
States. He lives not apparently in a real world.
  If we had a real world, we would not need OPIC, but we do not operate 
in a world in which other governments do not provide assistance to 
their exporters. They do. And more generously almost always than we do. 
If you want to retreat to an ivory tower. You can make a statement like 
the one quoted, but it is not realistic, ladies and gentlemen.
  As the chairman of the Asia and the Pacific Subcommittee, this member 
witnessed firsthand how foreign governments take high-paying export 
jobs away from American workers. If this was bad for American workers, 
the first people here complaining about it would be organized labor and 
they are not here. They are supportive of this program.
  Unclassified U.S. intelligence reports reveal that federal 
governments have stolen approximately $25 billion in recent years in 
potential U.S. contracts overseas by their generous assistance 
programs. How do these foreign governments take our jobs? Most 
importantly, they do not call export promotion corporate welfare. 
Political leaders in Germany, France, Japan, Canada, and all the 
industrialized countries of the world do not hesitate to give their 
exporters the tools necessary to win bids for lucrative infrastructure 
contracts in the world's developing countries.

                              {time}  1730

  No, they are out there working and financing it.
  Today in my office, this very day, I was visiting with a senior 
official from Japan's Export-Import Bank, the largest by far in the 
world. One can be sure that if this body fails to pass this 
legislation, he will be back in Tokyo and declare that 6 percent of the 
world's population, that is everybody that lives outside the United 
States, as Japan's markets, only to be shared with Europeans and the 
new tigers of Asia. And, he can report that America's political leaders 
have decided not to challenge Japan's aggressive pro-export government 
policies.
  In a perfect world, government should not be required to assist their 
exporters, investors or their workers. But we do not have that 
situation. The lucrative rewards in jobs of gaining contracts in the 
developing world are simply too great for those countries to resist.
  That is why Japan supports over 36 percent of its total exports with 
some form of export credit. That's right, Japan supports over 36 
percent of its total exports with some form of export credit. Compare 
that to the United States paltry figure of 2 percent of total exports.
  Mr. Speaker, the U.S. Congress will severely disadvantage U.S. 
exporters and investors if we choose to unilaterally disarm. In the 
highly competitive race for global markets, OPIC and TDA are to 
American jobs what missiles and tanks are to our national security.
  Therefore, this Member urges his colleagues to support H.R. 3759, the 
Exports, Jobs, and Growth Act of 1996.
  Mr. PETERSON of Minnesota. Mr. Speaker, I yield myself such time as I 
may consume.
  Mr. Speaker, there has been a lot of talk on this floor about how 
this program does not cost any money. I would just like to read out of 
the committee report here, page 11, where it has got the Congressional 
Budget Office cost estimate. ``For 1997 through 2001, the net budgetary 
impact of title I is the increased cost by $120 million a year over 
current law.''
  That is just in black and white.
  Mr. KASICH. Mr. Speaker, will the gentleman yield?
  Mr. PETERSON of Minnesota. I yield to the gentleman from Ohio.
  Mr. KASICH. Mr. Speaker, not only does it cost the American taxpayers 
and come out of the budget to a tune of $120 million, I am not sure if 
my colleagues understand what a loan guarantee is. A loan guarantee by 
the Federal Government means if the loan goes bad, the Government makes 
the loan good. That is the direct liability by the taxpayers of this 
country involved in these programs.
  If you have got an F minus-minus rating and you go under, guess who 
picks up the bill? The barber in Westerville picks up the bill, the 
beautician in Wheeling, WV, picks up the bill.
  Look at this loan portfolio. We not only have direct costs of running 
this program, but tremendous liabilities to the taxpayers involved in 
loan guarantees from the Federal Government.
  Mr. PETERSON of Minnesota. Mr. Speaker, reclaiming my time, we went 
through this with the savings and loan situation. I would like to know, 
the statement was made earlier this is all self-financing. What do you 
charge an F minus-minus company to make it a viable situation? How much 
do you have to charge a company like that? If you went into a bank and 
had an F minus-minus credit rating, you would not get a loan at all. So 
I think we need to get the whole facts of this out.
  Mr. BEREUTER. Mr. Speaker, will the gentleman yield?
  Mr. PETERSON of Minnesota. I yield to the gentleman from Nebraska.
  Mr. BEREUTER. Mr. Speaker, I thank the gentleman for yielding.
  Mr. Speaker, I would ask the gentleman from Ohio, in the 25-year 
history of OPIC, have they ever failed to generate a net operating 
surplus? Have they ever?
  Mr. KASICH. Mr. Speaker, if the gentleman will yield, let me just say 
to the gentleman, I will get you the loan portfolio chart. No banker 
that I have ever met in my lifetime would make these kinds of loans to 
somebody trying to go in and borrow money to build a house or create a 
small business. The simple fact of the matter is, is that this 
portfolio and the studies indicate that this portfolio is so risky you 
could not even privatize this operation, for the simple fact that 
people know that they would stand to lose billions and billions of 
dollars if these loans go bad, and I will anticipate that some of them 
in fact will.
  If this is such a wonderful program, creating all these jobs that are 
so profitable, my question is why do you need the taxpayers to bail you 
out?
  Mr. PETERSON of Minnesota. Mr. Speaker, I yield 2 minutes to the 
distinguished gentleman from Wisconsin [Mr. Klug].

[[Page H10163]]

  Mr. KLUG. Mr. Speaker, I would like to thank my colleague for 
yielding me time.
  Mr. Speaker, my colleague from Ohio just hit the nail on the head in 
this entire thing. What we are talking about, for folks at home who may 
be confused about this debate, is an insurance program run by the 
Federal Government for corporations who want to invest in risky 
political situations. They want to invest in risky political 
situations. We are running an insurance program for major corporations.
  Now, the argument you will hear from supporters of this program is if 
we did not run OPIC, there would not be any U.S. exports and American 
companies would not invest overseas without OPIC's insurance program.
  The fact of the matter is, that is not true. Of the $612 billion 
currently invested in developing countries, a third of them are insured 
by private companies who provide private insurance. You do not have to 
have the Government run it, they provide private insurance.
  Of the 10 leading countries that the United States does export 
programs with, OPIC is not involved whatsoever. There is not a single 
OPIC dollar involved. So there are going to be export jobs out there 
whether or not OPIC exists, whether or not OPIC invests this money.
  Listen to the irony. Here is what we are doing with OPIC. We are 
investing money in Eastern Europe that involves risky business deals. 
What we are doing in Eastern Europe is to try to help government-run 
corporations to make the transition to a private sector. In order to do 
that, we have to run a government corporation. We are trying to end 
government subsidies in Eastern Europe by running government subsidies 
right here in Washington, DC.
  The bottom line is what this is about is the taxpayers' exposure for 
risky loans overseas. We are going to double it, in fact, up to $25 
billion for one program, and $20 billion for the other program.
  Who is going to get the money? Well, Coke, Union Carbide, Motorola. 
Last year Citicorp had income of $3.5 billion, and OPIC guaranteed $842 
million. Citicorp is a bank, they do loans, they do investments. If 
they are coming to us to ask for insurance, does not that tell you 
maybe they are not too certain this portfolio is going to pay off?
  It is bad deals for the taxpayers. We may not have lost money, but 
$20 billion, $25 billion, is at exposure for U.S. taxpayers. We should 
be ending OPIC, not doubling it.
  Mr. PETERSON of Minnesota. Mr. Speaker, I yield 30 seconds to the 
distinguished gentlewoman from Washington, DC [Ms. Norton].
  Ms. NORTON. Mr. Speaker, let me try to rebut two points that have 
been made here.
  Makes money. First of all, we lose right off the top. OPIC pays no 
taxes, pays no dividends, and two-thirds of its income comes from 
Treasury securities, from us to us. Second, unions who support it, 
there are always some unions who profit from exports. The real question 
for us is do we make up in the loss of jobs here?
  For example, let me take four of the large OPIC users. Ford, minus 
160,000 jobs here; Exxon, minus 83,000 jobs here; AT&T, minus 127,000 
jobs here, General Electric, minus 185,000 jobs here.
  When you show me they are making up for that kind of loss of jobs, 
you will get me.
  Mr. ROTH. Mr. Speaker, I yield myself the balance of my time.
  The SPEAKER pro tempore. The gentleman from Wisconsin is recognized 
for 15 seconds.
  Mr. ROTH. Mr. Speaker, they say reason cannot beat emotion. I think 
reason can beat emotion. I am appealing to your reason. What other bill 
have we brought on the floor of this House that creates 123,000 good 
paying jobs? None. In 5 years, this bill will create $38 billion in 
exports. This OPIC has not cost the American taxpayer one red cent, but 
in the Treasury we have $2.5 billion because of this bill.
  Mr. Speaker, this is a good bill. I appeal to your reason to pass 
this bill for the American people.
  Mrs. MINK of Hawaii. Mr. Speaker, I rise in support of H.R. 3759, the 
Exports, Jobs and Growth Act of 1996. This measure reauthorizes the 
Overseas Private Investment Corporation [OPIC], the Trade Development 
Agency [TDA], and the International Trade Administration [ITA].
  Over the past 20 years our Nation's trade deficit has ballooned to 
over $100 billion, eliminating thousands of jobs and lowering standards 
of living for many Americans. Ironically, as the world economy becomes 
more globalized due to the North American Free-Trade Agreement [NAFTA] 
and the General Agreement of Tariffs and Trade [GATT], other 
governments have increasingly subsidized their companies' operations 
and have gained larger market shares with their respective products. 
Consequently, many American companies are left at a competitive 
disadvantage.
  To meet this challenge we need to maintain agencies, like OPIC, TDA, 
and ITA, that promote and strengthen our Nation's trade goals and 
objectives. According to the General Accounting Office [GAO], OPIC is a 
``net negative'' program. In other words, OPIC pays for itself. OPIC 
has successfully operated for 25 years and its programs are user-fee 
based, not taxpayer financed. Nationally, the Overseas Private 
Investment Corporation supported 200,000 American jobs and generated 
$43 billion in exports. Small and medium size American companies are 
direct beneficiaries of this program.
  Through the ITA and TDA, companies from Hawaii are able to obtain 
market data and initiate contacts with foreign firms. Moreover, small 
businesses have increased their share of the TDA awards from 22 percent 
in 1992 to 40 percent in 1995. In addition, this bill ensures a better 
coordinated export promotion service to small and medium-size 
businesses. The TDA supported 140,000 jobs and generated $7 billion and 
the ITA supported 92,000 jobs and generated $5.4 billion in 1995.
  In the State of Hawaii, an estimated 230 exporting companies depend 
on these agencies for support. As Hawaii continues to diversify its 
economy, these agencies will play a greater role in the overall trade 
growth and investments in the islands. In 1992, Hawaii exports totalled 
$15.3 million, 50.5 percent of the Gross State Product [GSP].
  The services OPIC, TDA, and ITA provide to America's small and medium 
size businesses is essential to gaining access to foreign markets, 
continued growth of the export market and is the catalyst to U.S. 
competitiveness in a global economy.
  We are starting to make some headway in the battle to decrease our 
trade deficit. In June, the Department of Commerce reported that our 
trade deficit fell to $8.1 billion, a 23 percent decrease from the 
month of May. Overall, the U.S. trade deficit $8.7 billion less than 
last year. With the help of all these agencies, foreign markets once 
closed to American products and services are now more open than ever. 
Unless we provide trade assistance to our small and medium size 
businesses, our trade balance with other countries will continue to 
soar and many more American jobs will be lost.
  I urge my colleagues to support H.R. 3759.
  Mrs. MEYERS of Kansas. Mr. Speaker, I rise in strong support of this 
important legislation. These programs are vital for maintaining our 
international competitiveness. The expansion of OPIC's insurance and 
finance authority is desperately needed to meet the demands of American 
businesses' increasing foreign investment. TDA is also important for 
providing American engineering firms the level playing field they need 
to compete in providing infrastructure to the developing world. As we 
know, this investment produces American exports, and these exports 
produce jobs. And the Foreign Commercial Service works directly with 
American exporters, both in this country and abroad, to assist them in 
dealing in foreign markets.
  I am especially pleased that this legislation provides for special 
emphasis for assistance to small businesses. The export market is a key 
untapped resource for many American small businesses. They need the 
assistance of OPIC and especially the Foreign Commercial Service both 
in its American offices and at our embassies overseas.
  Finally, I would like to refute the claims of those who say that this 
is corporate welfare. It is rather the Government performing its 
legitimate function of assisting American citizens in their dealings 
with foreign countries. In many countries, foreign trade and investment 
is still heavily regulated by the government. The only institution that 
can deal with those foreign government agencies as an equal is one 
affiliated with our Government. OPIC and TDA do not use taxpayer money 
to give one American business an unfair advantage over another American 
business, they use user fees to give American businesses an equal shot 
at competing with foreign businesses--all of which have equal or 
greater support from their own governments.
  I hope this bill can be quickly enacted into law.
  Mr. ANDREWS. Mr. Speaker, today the House will vote on H.R. 3759, to 
reauthorize one of the most egregious examples of corporate welfare in 
the Federal Government, the Overseas Private Investment Corporation

[[Page H10164]]

[OPIC]. OPIC provides subsidized loans and insurance to large 
corporations for overseas investments, backed by the full faith and 
credit of the United States. OPIC gives corporations risk insurance at 
bargain-basement prices, to promote their expansion in unstable regions 
around the world, where private markets would be unwilling to lend at 
such low rates.
  OPIC has placed at risk over $8.7 billion of taxpayer money. OPIC's 
generosity is extended to many Fortune 500 companies. DuPont received 
$200 million in loan guarantees. Coca-Cola obtained a loan guarantee of 
$165 million. Citicorp, with a net income of $3.5 billion in 1995, 
received $842 million of OPIC insurance. US West received $100 million 
in financing last year, while making a $1.3 billion profit. OPIC has 
helped other profitable companies, including McDonald's, Motorola, and 
Pepsi Cola.
  H.R. 3759 doubles this corporate welfare, by increasing OPIC's 
ceilings for insurance and subsidized loans. H.R. 3759 doubles OPIC's 
cap on investment insurance, from $13 billion to $25 billion, and 
doubles OPIC's financing authority from $9 billion to $20 billion. 
Recently, we reduced welfare for the poor. We should not now double 
welfare for rich companies.
  OPIC's corporate welfare hurts American workers. In 1994, Kimberly-
Clark obtained $9.27 million from OPIC; the same year, the Labor 
Department certified that 600 of Kimberly-Clark's U.S. employees were 
adversely affected by the company's increased imports. Similarly, Levi-
Strauss obtained $1.8 million in OPIC insurance, while the Government 
stated that 100 Levi-Strauss workers in the United States were hurt by 
the company's overseas trade. We should not encourage the largest 
corporations in America to invest abroad rather than reinvesting in 
America and creating jobs here at home.
  OPIC puts taxpayer dollars at risk. OPIC obligates American taxpayers 
to underwrite the insurance for the possible loss of private 
investments by America's richest companies. OPIC has risked over $8.7 
billion of U.S. taxpayer money in these markets. If there is political 
turmoil in an unstable country, and large companies lose their assets, 
the American taxpayers will have to bail them out. Taxpayers have 
already paid $80 billion to bail out Savings and Loans--we should not 
ask them to pay if OPIC's projects go bust.
  OPIC wastes scarce Federal dollars. Proponents of OPIC claim that it 
has actually brought $2 billion to the Treasury. But OPIC does not 
generate income. Rather, OPIC generates reserves against possible 
potential insurance claims, which is not income to the Treasury and 
will not help offset the deficit. If there are claims against OPIC's 
outstanding insurance, these reserves could be wiped out. And OPIC 
gives loan guarantees, as well as insurance. If borrowers default on 
OPIC's outstanding loan guarantees, taxpayers will have to bail it out.
  OPIC supports unnecessary projects. McDonald's received $14 million 
in loan guarantees to build 16 fast food restaurants in Brazil. OPIC 
guaranteed $27 million in loans for the renovation of a luxury hotel in 
Jamaica. OPIC even gave loan guarantees to a Costa Rican banana 
plantation, an Ecuadorian shrimp farm, and an art gallery in Haiti!
  I urge my colleagues to join me in opposing the massive expansion of 
corporate welfare in H.R. 3759.
  Mr. MANZULLO. Mr. Speaker, do you want to do something about 
improving wages and job security for your constituents? Then, support 
this bill.
  As chairman of the Exports Subcommittee on Small Business, I held 
eight hearings on Federal export promotion programs. I've come away 
convinced that these programs are very helpful to small- and medium-
sized firms, especially those new to exporting. What I discovered at 
these hearings is that the main problem facing small business is a lack 
of timely, accurate, and cost-effective information in finding 
potential customers overseas. This bill authorizes the trade functions 
of the Department of Commerce, including export assistance centers like 
the one headed by James Mied in Rockford, which small business 
exporters can use to find this information.
  Many pundits have directed low wage growth and company downsizing. 
But several academic studies point to a growing correlation between 
companies that decide to export and higher wages, benefits, increased 
productivity, and more jobs. A study sponsored by the respected 
Institute for International Economics and the Manufacturing Institute 
concluded that:
  First, firms that export grow jobs almost 20 percent faster than 
comparable nonexporting firms; second, exporting plants are 9 percent 
less likely to shut down than similar nonexporting plants; third, 
exporters pay their workers up to 10 percent more than nonexporting 
firms; and fourth, worker productivity is 20 percent higher at 
exporting firms.
  What many do not realize is that these amazing statistics apply 
equally to small firms located in the heartland of America. During the 
early 1980's, Rockford led the Nation in unemployment at 26 percent. 
Now, thanks to an export-driven recovery over the past decade, Rockford 
has now one of the lowest unemployment rates in the country at 4 
percent. During my visits to the 16th District, I am constantly amazed 
at the number of small firms engaged in world trade. RD Systems of 
Roscoe manufactures assembly machinery. Six years ago, they employed 11 
people and only 5 percent of their business went overseas. Now, they 
employ 30 people and 60 percent of their business are exports, 
including a $1.7 million sale to China of a machine to manufacture 
cellular phone batteries. I find this repeated over and over throughout 
the 16th District where a little help from the Rockford export 
assistance center was the difference in making an overseas sale. If we 
want small firms to stay alive and grow, then looking to foreign 
markets should be one tool in their arsenal. I ask unanimous consent to 
insert in the Record a story from Business Week detailing this 
nationwide phenomena and an article from the Rockford Register Star 
providing local examples.
  The Federal Government can serve as a helpful partner through OPIC, 
TDA, and the Department of Commerce International Trade Administration 
division in encouraging more and more small businesses to enter the 
global marketplace. This is not corporate welfare. This one important 
way we can grow jobs and increase job security in this country. And, 
H.R. 3759 raises revenue from corporations for the Government because 
OPIC's political and commercial risk insurance premiums brought in $122 
million into the Treasury last year.
  That's why the title of this legislation, the Exports, Jobs, and 
Growth Act of 1996, is aptly named. I also appreciate the willingness 
of Chairman Roth to accede to my request to place in the statutory 
mandate of the Trade Promotion Coordinating Committee a requirement 
that they identify more ways they can coordinate export promotion 
services to work for small- and medium-sized businesses. Big companies 
have their own sources of information and more resources at their 
disposal. Encouraging more small business to become ready to export 
must be a top priority of the TPCC.
  Finally, Mr. Speaker, I could not let this opportunity pass without a 
salute to the magnificent work of the chairman of the International 
Economic Policy and Trade Subcommittee, Mr. Roth of Wisconsin. Toby, 
this may be the last time, as a manager of a bill on the floor, that we 
can formally thank you for your service to this House. We will all miss 
your leadership next year.
  Thank you, Mr. Speaker, for your indulgence, and I urge the adoption 
of this bill. The U.S. Chamber of Commerce; the Coalition for 
Employment Through Exports; the National Foreign Trade Council; and the 
United States-Russia Business Council are but a sample of the 
organizations in support of this legislation. Let's pass this bill on 
suspension today so that the other body can act expeditiously before 
OPIC expires at the end of this month.

           [Special Report from Business Week, Apr. 17, 1995]

                     It's a Small (Business) World

                     (By Amy Barrett in Washington)

       For 102 years, Bicknell Manufacturing Co. has made 
     industrial drill bits for construction equipment at its 
     modest plant in Rockland, Me. For most of that time, the 
     family-owned concern thrived, with growth of about 8% a year 
     in the late 1980s. Then came the 1990 recession. The 
     construction market withered--and with it demand for 
     Bicknell's products. As sales stalled, the company scrambled 
     for new business. ``We had to change course,'' says John E. 
     Purcell, Bicknell's general manager.
       With little likehood of a quick turnaround at home, 
     Bicknell set its sights on markets abroad. ``There was much 
     trepidation, with a capital T.'' says Purcell, 38, recalling 
     that none of the 65 employees at the $4 million company had 
     had any foreign experience. Still, with construction booms in 
     Brazil, Colombia, and Mexico, the foreign market was 
     beckoning. After Purcell found a distributor while visiting 
     Mexico on a trade mission sponsored by the Small Business 
     Administration, Bicknell began exporting to Latin America two 
     years ago. And Purcell couldn't be more delighted with the 
     results. He has just signed a deal to begin selling in China 
     and Vietnam. This year, Purcell expects international sales 
     to grow 20%, for 15% to 20% of the company's total revenue. 
     ``We're starting to see it pay off,'' he says.
       Purcell's enthusiasm is just one case of a new global fever 
     to hit U.S. business. This time, instead of afflicting the 
     goliaths of Corporate America, it's sweeping through the 
     ranks of U.S. entrepreneurs. Whether they're seeking to 
     escape sluggish markets at home or build on their successes, 
     more small companies are looking beyond the local and 
     regional markets that have long nurtured and sustained them.
       A survey of almost 750 companies by Arthur Andersen & Co. 
     and National Small Business United, a trade group, found that 
     20% of companies with fewer than 500 employees exported 
     products and services last year. That's up from 16% in 1993 
     and 11% in 1992, the first year the survey was conducted.

[[Page H10165]]

     And many experts expect that the trend will continue as more 
     and more small businesses plumb the potential of foreign 
     markets. ``It presents a huge growth opportunity,'' says 
     David L. Birch, president of economic researcher Cognetics 
     Inc.
       The push abroad by a whole new stratum of U.S. companies is 
     having a profound impact on the trade front. True, the 
     $200,000 in foreign sales that Bicknell chalked up last year 
     is nothing compared with Boeing Co.'s $11.4 billion in 
     exports. But together, small companies are helping fuel an 
     export explosion that has more than doubled total overseas 
     sales since 1986, to $696 billion last year. While service 
     sector exports are difficult to measure, dri/McGraw-Hill 
     figures that small businesses could account for 50.8% of the 
     $548 billion worth of manufactured goods that the U.S. 
     will likely export this year, up from 45.5% a decade ago.
       Entrepreneurial success overseas is bound to produce other 
     economic benefits. Bountiful markets abroad could insulate 
     small companies from periodic downturns at home. And as it 
     carves out more foreign business, small business could 
     enhance its reputation as the job generator of the 1990s. ``A 
     lot of small businesses adding five or six people may not 
     sound like much,'' says Donald T. Hilty senior fellow at the 
     Economic Strategy Institute in Washington. ``But when you add 
     it all up, there's real potential for job creation.''
       Tiny Lucerne Farms in Fort Fairfield, Me., is certainly 
     doing its part on the job front. Thanks to the dollar's 
     precipitous drop against major currencies in recent months, 
     George A. James, president of the $350,000 horse-feed 
     company, says his products are 25% cheaper in yen terms 
     compared with a year ago. That drew an inquiry from a 
     Japanese distributor. Now, orders from Japan could double his 
     total revenue this year. To keep up with the flood of 
     business, James is planning to take on five new employees on 
     top of his current eight-person team. ``Without this 
     international business, we could never expect to grow as 
     rapidly and add these jobs,'' he says. ``This is a real shot 
     in the arm.''
       High-profile pacts such as the North American Free Trade 
     Agreement and the General Agreement on Tariffs & Trade have 
     also accelerated the march by small business into the global 
     arena. Both agreements have gone a long wait toward 
     lowering barriers to imports in foreign countries, while 
     alerting entrepreneurs to opportunities abroad.
       Jeff A. Victor, for one, credits NAFTA for his surging 
     export volume. The general manager of $6 million Treatment 
     Products Ltd., which makes car cleaners and waxes, had been 
     trying to expand his small presence in Mexico since 1990. But 
     stiff Mexican tariffs that ran as high as 20% made that 
     impossible for the Chicago-based company. Six months after 
     NAFTA went into effect in January, 1993, and tariffs started 
     gradually dropping, Victor says he landed contracts with 
     almost every major retail chain in Mexico, including 
     Futurama, Gigante, and Soriana. His shipments to Mexico have 
     tripled, to roughly $300,000, about 20% of the company's 
     total exports. Victor concedes that Mexico's financial 
     meltdown has hurt. One retailer has put a big order on hold. 
     But he's sticking it out. To make his car wax more affordable 
     to Mexican consumers, he's considering selling it in smaller 
     bottles. ``After selling in Mexico for five years, I'm not 
     going to pack my bags and leave,'' he vows.


                              risky shores

       The threat of a Mexican-style calamity in other countries 
     isn't the only thing that makes venturing abroad so risky and 
     complicated. Lining up customers and distributors--tough 
     enough at home--becomes an enormous challenge when a market 
     is a continent away. And then there's financing. Lenders are 
     already leery of small companies. But the thought of a pint-
     size outfit venturing into uncharted markets is enough to 
     give some bankers the vapors.
       They have reason to be worried, because plenty of small 
     companies are innocents abroad. Many entrepreneurs get their 
     first taste of global markets by filling stray foreign orders 
     that come their way. Often generated by referrals or chance 
     meetings at domestic trade shows, these orders are quick and 
     painless to fill--and can give the false impression that 
     exporting isn't so tough. ``A lot of small businesses export 
     opportunistically,'' says Abby K. Shapiro, chairman of 
     International Strategies Inc., a trade consulting firm. ``The 
     problem is not enough of them do it thoughtfully.''
       Lack of proper preparation can lead to costly mistakes. 
     John P. Woolley, general manager of PC Industries, recalls 
     how he shipped a $10,000 replacement computer component to a 
     French customer six months ago and was stunned when he was 
     billed $2,500 for value-added tax. Woolley's company had to 
     absorb the unexpected bill. He says such expensive lessons 
     are causing his $3 million Glenview (Ill.) company to rethink 
     its overseas commitment. ``The jury is still out on how 
     strongly we'll pursue it,'' he says.
       For small companies that decide to persevere with their 
     export strategies, identifying suitable markets is generally 
     the first step. Many turn to federal and state agencies for 
     market information (page 101). The U.S. Commerce Dept., for 
     instance, has a trade database available through its 73 field 
     offices and public libraries. The database has research 
     reports on 117 industries in 228 countries.
       It's a good starting point for figuring out what's hot and 
     what's not. Right now, environmental companies--those 
     specializing in everything from waste-water treatment gear to 
     landfill management--are finding opportunities in the newly 
     industrialized markets of South Korea, Indonesia, Malaysia, 
     and Taiwan. And in Latin America, a growing middle class is 
     fueling a new wave of health consciousness. Companies making 
     cholesterol-testing equipment, for instance, may find 
     eager customers in Brazil and Mexico.
       Some entrepreneurs display a lot of ingenuity when scoping 
     out markets. Harden H. Wiedemann, chairman of Assurance 
     Medical Inc., a $2 million Dallas company that sells alcohol- 
     and drug-testing services, uses the Internet. He says he has 
     found voluminous online information on the growing concern 
     with alcohol-related problems in Argentina. ``Some of the 
     best information we fund we just stumbled on as we were 
     surfing around,'' he says


                             farther afield

       Not surprisingly, most first-time exporters head north of 
     the border. With few language barriers, a similar business 
     culture, and now NAFTA. Canada is the most appealing market 
     for small companies. But entrepreneurs, emboldened by past 
     trade triumphs or tempted by flourishing markets, are setting 
     their sights on more distant climes. Fully 12% of those 
     responding to the Arthur Andersen/Small Business United 
     Survey say they export to Western Europe in 1994, while 11% 
     targeted fast-growing markets in the Asia-Pacific region.
       Heather Stone has certainly expanded her horizons. Last 
     year, she began selling her invention-- a scooter for people 
     with leg or foot injuries--to a distributor in Canada. Then 
     last fall, Stone was invited by the Japan External Trade 
     Organization to display her product, called Roller-Aid, at a 
     Japanese trade show. She now expects her company, Stoneheart 
     Inc. in Cheney, Wash., to start shipping to Japan this 
     summer. She figures exports will generate about 20% of her 
     company's $500,000 in sales this year. ``This international 
     business just kind of fell in my lap,'' she says with a smile 
     ``For me, it wasn't as difficult as I expected.''
       Chasing emerging markets requires something many 
     entrepreneurs already have: a stomach for risk. Like his 
     counterparts at much bigger companies, Robert A. Giese of 
     RGdata Inc. was quick to set his sights on untapped markets 
     in the then-Soviet Union--as early as 1989. The Rochester 
     (N.Y.) computer-net-working company that he founded in 1974 
     hadn't done any serious exporting. But he felt the 
     opportunities in Russia and nearby countries were 
     overwhelming. True, shipping was a nightmare, and phone 
     communication was in the dark ages. But he says waiting until 
     a market is stable makes no sense: ``By then, everyone 
     already has a dance partner.'' In 1989, he teamed up with 
     three other small companies to pay for a $25,000 booth at a 
     Commerce Dept.-sponsored trade show in Moscow. Last year, 20% 
     of his $19 million in business came from former Soviet 
     countries.
       Some entrepreneurs have turned themselves into globe-
     trotting promoters to drum up business. Katherine Allen, who 
     with her mother runs Allen Filters Inc., figures she spends 
     almost a third of her time abroad, schmoozing with potential 
     customers for her oil-cleanup products and services. Allen 
     reckons that, of her yearly $4 million in sales, half comes 
     from exports, thanks to her network of contacts from 
     Singapore to Sao Paulo. And now--two years and numerous 
     cocktail parties after her first visit to Beijing--she has 
     potential customers in China. Allen Filters may not have 
     the marquee value of big U.S. exporters, but Allen says 
     her journeys have convinced her that a small company can 
     make it if it understands markets and customers. ``If they 
     have a good foundation, I think the world is open to most 
     small businesses,'' she says.
       For the typical small company, however, a foreign partner 
     or distributor is the only access to a new market. It's a 
     crucial relationship. Lazy distributors won't do much for 
     business, while inept or unsavory ones can ruin a small 
     company's reputation in a new market. Two years ago, computer 
     maker win Laboratories Ltd. in Manassas, Va., pulled out of a 
     joint venture in Chile, blaming its Chilean partner for 
     customs delays and weak sales. ``It hasn't soured the outlook 
     on exporting here,'' says Mark H. Magnussen, win's director 
     of business development, who is considering joint ventures in 
     Brazil and Mexico. ``But in the future, we'll do a lot more 
     legwork.''


                               fish story

       Such research doesn't have to mean frequent trips to far-
     flung ports of call. One gold mine of information: U.S. 
     companies that sell related products. Fred Hansen, vice-
     president for marketing at Mardel Laboratories Inc. in 
     Glendale Heights, Ill., which makes water conditioners and 
     other supplies for tropical-fish aquariums, hired a 
     distributor in Hong Kong after contacting Penn Plax Plastics 
     Inc., a Garden City (N.Y.) company that sells plastic 
     underwater plants. The company didn't compete with Mardel, 
     but it knew both the distributor and the industry well.
       Small companies with bigger budgets can participate in 
     trade shows sponsored by state and federal agencies. The 
     Commerce Dept.'s Gold Key program, for example, can arrange 
     for a small-business executive to meet with prescreened 
     potential partners in a foreign country. Jim DeCarlo, 
     president of Phenix

[[Page H10166]]

     Technologies, based in Accident, Md., met his Spanish 
     distributor on such a jaunt. He spent three days in Madrid in 
     1993, meeting with potential partners at the U.S. embassy. 
     The trip cost the company, which makes electrical testing 
     equipment, roughly $3,500--a wise investment, says DeCarlo. 
     ``I wouldn't have known where to start'' to look for a 
     partner, he concedes.
       Like their bigger brethren, some small businesses are 
     establishing overseas arms. Eli E. Hertz, founder of Hertz 
     Computer Corp. in New York, bought a small distributor in 
     Israel in 1990 to sell his equipment. He says being nearby to 
     handle his clients' servicing needs gives him an edge over 
     rival exporters. Today, Israeli customers account for 25 
     percent of his $10 million in sales. ``Being there is a huge 
     advantage,'' Hertz says. His customers agree. ``When they get 
     a call, they're here in four hours,'' says Shlomo Stern, the 
     head of systems operations for OFEK Securities & 
     Investments Ltd.
       Whatever their strategy for penetrating foreign markets, 
     small companies inevitably find that lining up trade 
     financing to pay for manufacturing or to extend credit to 
     customers is the stiffest challenge of all. Many U.S. banks 
     abandoned trade financing in the 1980s after the Latin 
     American loan debacle. Even banks though to be entrepreneur-
     friendly shy away from tiny, complex, labor-intensive trade 
     finance deals. Jeanne A. Hulit, vice-president for 
     international banking at Key Bank of Maine, a unit of 
     KeyCorp, says one recent small trade loan--less than 
     $100,000--took so much time and energy that she might require 
     an up-front fee from exporters in the future. ``It was way 
     too much work for a small loan,'' says Hulit.
       Some small companies have benefited from trade finance 
     programs sponsored by government agencies. Phenix 
     Technologies' DeCarlo recently lined up a $400,000 revolving 
     credit for his export business with the help of a guarantee 
     from the Maryland Industrial Development Financing Authority. 
     But such programs are poorly funded. Though the Small 
     Business Administration and the Export-Import Bank have 
     doubled the size of their financing programs since 1991, 
     together they guaranteed only $253 million in export-related 
     lending for small businesses in 1994.
       And entrepreneurs still complain about excessive paperwork. 
     Last fall, Thomas Parks, chairman of 423 million Quickway 
     Industries, applied for a line of credit backed by the ExIm 
     Bank to boost his company's auto machine-tool exports. The 
     bank wanted to see audited financial statements for the past 
     three years from Parks' customers. When Quickway asked six 
     big foreign customers for such documents, all but one flatly 
     refused, Parks says. ``They said: `It's just too complicated 
     dealing with you guys,' '' he recalls. In the end, Parks 
     continued to draw on his company's own limited cash flow to 
     finance his export expansion. But he says he hasn't grown 
     nearly as fast as he had hoped.
       Unfortunately for small companies, there's plenty more red 
     tape awaiting them overseas. Foreign governments impose 
     standards for imported goods that are often intended as 
     barriers to imports. The Commerce Dept. figures that for the 
     typical U.S. machine manufacturer, the cost of additional 
     paperwork and certification can add up to $100,000 a year. 
     That's a big bite for any company and potentially crushing 
     for a small one. On top of that, importers often insist that 
     suppliers meet guidelines set by the International 
     Organization for Standardization. The group, representing 91 
     countries, sets quality measures on manufacturing procedures, 
     design, and servicing. Many small companies find the 
     certification too costly and time-consuming.
       Of course, no one said that exploring exotic markets would 
     be easy. It never has been--neither for caravan drivers 
     plying the Silk Road nor for sailors seeking the Spice 
     Islands. But like them, today's entrepreneurs know that 
     playing it safe by staying at home may be the riskiest 
     strategy of all.


              WANT TO GO GLOBAL: HERE'S WHERE TO FIND HELP

       At one time or another, many small businesses have toyed 
     with the idea of going global. But just understanding the 
     paperwork and bureaucracy associated with exporting can be 
     daunting. Information is hard enough to come by. Even though 
     the Commerce Dept. is more supportive of small business these 
     days, it's still widely viewed as an advocate of big 
     companies. And many entrepreneurs have given up in sheer 
     frustration. Joel Krieger, head of marketing for Taub Floor 
     Coverings Inc., a $3 million company based in Staten Island, 
     N.Y., put his global plans on hold three years ago when he 
     realized he didn't have the time or the staff to devote to 
     coping with the complexity of foreign markets. ``Just 
     gathering the information available was staggering,'' he 
     recalls.
       Yet for small businesses willing to do their homework, 
     there are a number of excellent resources to help them get 
     started. They are relatively low-cost services; many are free 
     of charge. In the long run, the guidance these services offer 
     can speed up a new exporter's entry into foreign markets 
     while helping to sidestep many of the most common--and 
     costly--blunders. Here are just a few places to go when 
     developing an export strategy.

                        Commerce Dept. Hot line

       A good starting point. Specialists can provide details on 
     different federal programs details on different federal 
     programs that will help new exporters tap foreign markets, as 
     well as general information on state export promotion 
     programs. The Commerce Dept. can also offer guide sheets on a 
     number of tricky exporting problems; including how to handle 
     the paperwork required to qualify for the low tariffs under 
     NAFTA. Consultations and information are free. Call 800 USA-
     TRADE.

                      Export opportunity hot line

       Run by the Small Business Foundation of America, a 
     nonprofit organization based in Washington. Calls are handled 
     by trade experts. Tips include how to find a foreign 
     distributor and cheap ways to test-market a product overseas. 
     Companies that are exporting for the first time can also get 
     advice on how to research potential markets. And exporters 
     who have hit snags can get help in solving their problems. No 
     charge. Call 800 243-7232. In Washington, call 202-223-1104.

                  Service Corps of retired executives

       Working on conjunction with the Small Business 
     Administration, SCORE serves to match up small businesses 
     with mentors who have experience in foreign trade--at no 
     cost. These volunteer business veterans can assist new or 
     troubled exporters in putting together a strategy for 
     succeeding abroad. SCORE has 370 chapters throughout all 50 
     states and roughly 500 seasoned exporting counselors.

                        Access to export capital

       The AXCAP program is run by the Bankers' Association for 
     Foreign Trade, a trade group. Small exporters who don't know 
     where to go for financing can contact AXCAP specialists. 
     Searching their national database, the group provides a small 
     business with a list--usually within 24 hours--of banks in 
     its area that handle various types of transactions. The 
     searches are all free. Call 800 49AXCAP.

                    Export legal assistance network

       Like it or not, small exporters will probably need a good 
     attorney. A lawyer with experience in foreign trade can give 
     new exporters advice on everything from protecting patents 
     and trademarks to drafting contracts with new partners. This 
     network provides free referrals to local attorneys with trade 
     experience who provide one free counseling session for new 
     exporters. Contact either the Commerce Dept. hot line or Judd 
     L. Kessler, the national coordinator for the network, at the 
     law firm of Porter, Wright, Morris & Arthur in Washington. 
     Call 202 778-3000.

                  American society for quality control

       This not-for-profit trade association offers free advice to 
     companies that want to meet manufacturing standards set by 
     the International Organization for Standardization, a group 
     representing 91 countries. While the standards are fairly 
     general, companies hoping to win substantial overseas 
     business may have to adjust their operations to pass a 
     certification test conducted by an accredited examiner. The 
     society can also put callers in touch with other companies 
     that have already gone through the process.
                                                                    ____


            [From the Rockford Register Star, Aug. 13, 1995]

Global Economy Hits Home--Local Industry Cashes in on Gains in American 
                                Exports

                          (By Georgette Braun)

       Rockford.--Mark Ellis figured it cost RD Systems less than 
     $10,000 to land a $1.7 million contract last week to build 
     four machines for a Chinese company that manufactures 
     batteries for cell phones.
       That one order represents a third of the company's $5 
     million in annual sales.
       ``It was mostly faxes, phone calls. I have 150,000 miles on 
     my frequent flier card,'' said Ellis, sales manager for RD. 
     ``I know my way around Hong Kong better than I know my way 
     around Rockford.''
       Selling overseas has become a bigger part of Ellis' job at 
     the Roscoe company that employs 30 workers. Five years ago, 
     exports were about 5 percent of RD Systems' sales. Today, 
     it's 60 percent.
       RD Systems is not alone in its reliance on exports to keep 
     sales growing. Big export gains are being made on a national 
     and local level.
       In the second quarter, exports of U.S. goods and services 
     grew at an annual rate of 7.2 percent, the Department of 
     Commerce reported last month. That was much faster than the 
     economy's 0.5 percent annual growth rate.
       One reason for the export increase was the decline in the 
     value of the dollar, which made U.S. products a better buy. 
     Another reason was growing demand for U.S. products in the 
     Asia/Pacific market.
       Exports of manufactured goods, as a percentage of the gross 
     domestic product, climbed to 10.7 percent last year from 7.5 
     percent in 1984.
       In Illinois, exports grew by 99 percent between 1987 and 
     1993, exceeding the 90 percent increase recorded by the 
     nation as a whole.
       During the same period, export sales from the 611 zip code, 
     which encompasses Winnebago County, grew 51.1 percent.


                            local exporters

       Large local employers are among the top exporters in 
     Illinois, according to Crain's Chicago Business. Sundstrand 
     Corp., a Rockford-based aerospace and industrial parts maker, 
     ranked 12th in last year's listing; Newell Co., a Freeport-
     based housewares, hardware and office suppliers maker, was 
     20th; and Woodward Governor Co., a Loves Park-based aircraft 
     and industrial controls maker, ranked 23rd.
       Manufacturers aren't the only ones growing because of an 
     increase in international business.

[[Page H10167]]

       Lorna Flores started AMCORE Bank's international services 
     program six years ago. It now serves 28 companies.
       The volume of transactions made through the program has 
     more than tripled, she said.
       One of the bank's most popular services helps companies 
     obtain letters of credit that assure payment from foreign 
     companies through a U.S. bank.
       The letters are especially important in countries ``where 
     there is a lot of political risk,'' such as in Brazil or 
     Mexico, she said.
       Steven Morreim, president of QED Dryer Sales and Mfg., said 
     he uses the bank's services ``to keep us straight on 
     paperwork.''
       The Rockford company is in the process of shipping a grain 
     dryer worth more than $100,000 to a company in Russia. QED 
     has done business in Nigeria, Turkey and Colombia.
       Exporting makes up about 10 percent of the company's sales. 
     Morreim expects to at least double that in five years. The 
     company employs eight full-time workers.


                         legislation, education

       Local legislators and educators are also looking at how 
     local companies can increase their exports.
       Rep. Don Manzullo, R-Egan, is trying to reorganize U.S. 
     trade agencies within the Department of Commerce to save 
     money without hurting business exports.
       Manzullo has been holding hearings on trade promotion and 
     the function of various programs. He is working on trying to 
     reorganize trade promotion efforts and cut duplication.
       ``The future of trade promotion must be easily accessible 
     to the entire U.S. business community,'' he said in a 
     statement earlier this month before testifying to the House 
     International Relations Committee on the future of the 
     Department of Commerce.
       Rock Valley College, with other economic development 
     groups, hopes to help small businesses through an ``export 
     clinic'' to be held at the college Thursday, Aug. 24. The 
     college next month will begin a three-month-long, once-a-week 
     class on how to sell overseas.
       Small companies are ``the ones that need (help) most,'' 
     because of limited resources, said Thomas de Seve, 
     coordinator of international programs.
       Getting into the business of exporting is not as hard as it 
     seems, according to those who have done it.
       ``It's not intimidating,'' said Larry Lewis, owner and 
     president of National Metal Specialists Corp. ``The first 
     time you go through it, it might be, but after you start 
     repeating it, it's not bad.''
       Exports at National Metal make up about $300,000 of the 
     company's $4 million in annual sales. The company ships to 
     countries in Central America and South America.
       National Metal's 60 employees manufacture mops and parts 
     for mops.
       Lewis said the company made inroads in exporting by making 
     contacts at international trade shows. So far, profit margins 
     made on exports has eclipsed those made domestically.
       ``Overall, it's 20 to 30 percent better,'' he said.
       ``The people are so happy to find the product. You don't 
     have the intense retail pressure.''

  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Wisconsin [Mr. Roth] that the House suspend the rules 
and pass the bill, H.R. 3759, as amended.
  Mr. ROTH. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 5, rule I and the Chair's 
prior announcement, further proceedings on this motion will be 
postponed.

                          ____________________