[Congressional Record Volume 143, Number 110 (Wednesday, July 30, 1997)]
[House]
[Pages H6361-H6380]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




      FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS 
                        APPROPRIATIONS ACT, 1998

  The SPEAKER. Pursuant to the order of the House of Thursday, July

[[Page H6362]]

24, l997, and rule XXIII, the Chair declares the House in the Committee 
of the Whole House on the State of the Union for the further 
consideration of the bill, H.R. 2159.

                              {time}  1831


                     In the Committee of the Whole

  Accordingly, the House resolved itself into the Committee of the 
Whole House on the State of the Union for the further consideration of 
the bill (H.R. 2159) making appropriations for foreign operations, 
export financing and related programs for the fiscal year ending 
September 30, 1998, and for other purposes, with Mr. Thornberry in the 
chair.
  The Clerk read the title of the bill.
  The CHAIRMAN. When the Committee of the Whole rose earlier today, the 
bill had been read through page 4, line 24.
  For what purpose does the gentleman from California [Mr. Royce] rise?


                  Amendment No.13 Offered by Mr. Royce

  Mr. ROYCE. Mr. Chairman, I offer an amendment.
  The Clerk read as follows:

       Amendment No. 13 offered by Mr. Royce: In Title I, under 
     the heading ``Overseas Private Investment Corporation 
     Noncredit Account'' after ``$32,000,000'' insert 
     ``(reduced by $11,200,000)''.

  Mr. CALLAHAN. Mr. Chairman, I ask unanimous consent that all debate 
on this amendment and all amendments thereto close in 40 minutes and 
that the time be equally divided.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Alabama?
  There was no objection.
  The CHAIRMAN. The gentleman from California [Mr. Royce] will control 
20 minutes. Does the gentleman from Alabama [Mr. Callahan] seek time in 
opposition?
  Mr. CALLAHAN. Yes, Mr. Chairman, I seek time in opposition.
  The CHAIRMAN. The gentleman from Alabama [Mr. Callahan] will control 
20 minutes, and the gentleman California [Mr. Royce] is recognized for 
20 minutes in support of his amendment.
  Mr. ROYCE. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, the Royce-Andrews-Kasich amendment cuts the operating 
expenses of the Overseas Private Investment Corporation. It puts it to 
a level that is more in keeping with the level of business this House 
has authorized for OPIC. Specifically, this amendment reduces the 
administrative appropriations by $11.2 million, from $32 million to 
$20.8 million.
  This amendment is supported by a diverse coalition of 12 
organizations, organizations who come at it from differing perspectives 
but groups united by the view that the U.S. Government should not be in 
the business of insuring American corporations to invest abroad and 
making loans to American corporations to encourage them to invest 
abroad.
  Now, there are many in this body who would like to see OPIC closed. 
That is the position of the 12 groups. Many of us fundamentally 
question why the American taxpayer should be supporting a government 
agency that makes loans and issues risk insurance when these services 
are available privately. And despite what OPIC and its supporters say, 
there are companies that would do this business. Maybe not at the rates 
that OPIC offers, but that is the point. OPIC is a business subsidy.
  So let me ask my colleagues, many of whom have worked hard to give to 
the private sector what government services can better be done by the 
private sector, let me ask them to ask themselves why should OPIC be an 
exception to this rule? Why do we have a government agency competing 
with the private sector? That is the American financial services sector 
that they compete with, the most efficient in the world. And also ask 
why the American taxpayers should be liable to potentially multi-
billion dollar losses, and that is what we are talking about.
  Do Members in this body recall the S&L crisis? It was not that long 
ago. Yes, OPIC has not had large losses, but the problem is there. 
Remember, we were given assurances that there would be no S&L problem.
  So I want to point out OPIC's risky loans. Members, look at how many 
are rated D or D-minus or F or F-minus and FF-minus. Common sense 
should tell us something is not right here.
  And many of us wonder why some of our largest businesses should 
benefit from OPIC subsidies. Do Coca-Cola and AT&T and McDonald's 
really need OPIC to make a profit abroad?
  Let us not show so little faith in the power of American businesses 
and the American economy, which year after year ranks as the most 
competitive in the world, and please do not tell me that Coca-Cola, 
which just announced an 88 percent increase in earnings for the second 
quarter, is not a world class company because of the Overseas Private 
Investment Corporation.
  Do not get me wrong, these are great companies, the backbone of the 
American economy, but they do not need OPIC, and we hear that OPIC does 
not cost the American taxpayers a dime. That is a mantra of OPIC 
supporters, yet the Congressional Research Service has reported that 
OPIC has cost a minimum of $73 million over the last few years, and the 
Congressional Budget Office tells us that we would save $296 billion if 
we ended the program.
  Last, we hear that OPIC creates jobs. I ask my colleagues that logic. 
Members come down to the floor every day and praise the American 
economy. They say how dynamic it is, and they are right. We have the 
most dynamic economy in the world. That is not because we have OPIC 
creating jobs. Consider that the Congressional Research Service has 
reported there is little theoretical support or empirical evidence 
which supports claims that subsidizing exports or overseas investment 
offers a positive net gain in jobs in the U.S. economy.
  There is simply no justification for appropriating $32 million to 
OPIC today. This is a 50 percent increase in appropriations from 1994, 
and no more business is being authorized than was authorized then.
  I ask my colleagues why does OPIC need this additional money? Let us 
cut it back.
  Mr. Chairman, I reserve the balance of my time.
  Mr. CALLAHAN. Mr. Chairman, I ask unanimous consent that one-half of 
my time be yielded to the gentlewoman from California [Ms. Pelosi] and 
that she be allowed to further yield time.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Alabama?
  There was no objection.
  Mr. CALLAHAN. Mr. Chairman, I rise in opposition to the amendment, 
and in staunch opposition, but I first yield 3 minutes to the gentleman 
from Nebraska [Mr. Bereuter], who is chairman of the Committee on 
International Relations' Subcommittee on Asia and the Pacific.
  [Mr. BEREUTER asked and was given permission to revise and extend his 
remarks.]
  Mr. BEREUTER. Mr. Chairman, I do rise in strong opposition to the 
Royce amendment.
  Mr. Chairman, they are laughing and gloating in Germany, France and 
Japan over this amendment to gut the Overseas Private Investment 
Corporation. Those three countries, among others, will be fighting over 
the hundreds of thousands of jobs and trillions of dollars in 
infrastructure projects if the House votes to pass the Royce amendment 
and gut OPIC, United States foreign policy and investment insurance 
agencies. The Japanese Government already out-subsidizes our investment 
insurance 6 times to 1 as a percentage of GDP. Germany spends 5 times 
more, and France 4 times more than the United States to help their 
companies win lucrative infrastructure projects in the developing 
world, and those infrastructure projects lead to a whole series of 
other American job creating activities.
  Mr. Chairman, this Member finds it truly amazing that some of our 
well-intended colleagues would thus hurt our Nation in so shortsighted 
an effort to eliminate funding for an agency of the Federal Government 
which runs at no net cost and helps make our companies competitive in 
the global marketplace.
  At a time when the U.S. trade deficit is hitting record highs, 
supporters of the Royce amendment feel compelled to remain in those 
isolated, academic, ivory towers chastising government involved in 
overseas investments. Well, Mr. Chairman, in a perfect world 
governments would not have to be involved in subsidizing overseas 
investments.

[[Page H6363]]

  In fact, I have added an amendment to an OPIC authorizing bill moving 
through the House Committee on International Relations which requires 
U.S. officials to negotiate with foreign competitors and put an end to 
these subsidies, and that is what we try to do through the OECD. We are 
making progress, but we are nowhere close. But until that time, 
therefore, our workers, our exporters, our businesses cannot afford to 
have the U.S. House of Representatives vote like a bunch of 
isolationists in ivory towers. The fact remains that foreign 
governments will fight and spend money to rustle jobs away from hard-
working Americans.
  Mr. Chairman, this Member urges his colleagues to vote for American 
workers and vote against the Royce amendment.
  Let me bring, finally, a few facts to the attention of my colleagues. 
OPIC makes a profit every year since its creation. Here is what the 
net, net annual income was for OPIC. Starting in 1971, $25.9 million. 
Today, last year, that particular year, 1996, $208 million, nearly $209 
million. Here is the cumulative impact of U.S. exports generated, I 
hope, by OPIC. It has increased from $687 million the first year, and 
we believe this, $52,823,000,000 this last year. That is how much U.S. 
exports cumulatively was generated by OPIC.
  Finally, take a look at the cumulative U.S. jobs created and 
generated by OPIC, and I mean directly, despite what we heard a minute 
ago. It has increased from a relatively small amount, 4,800 the first 
year; this year, 225,000 plus. That is how many additional American 
jobs were created by OPIC.
  I urge my friends to oppose the Royce amendment.
  Mr. ROYCE. Mr. Chairman, I yield 1 minute to the gentleman from Ohio 
[Mr. Kasich].
  Mr. KASICH. Mr. Chairman, let me get the attention of my colleagues 
in the House on both sides of the aisle. We were just able to pass a 
bill that started to dramatically reform the operation of the Federal 
Government and get us to a balanced budget.
  What is this vote about? This vote is about reforming corporate 
welfare.
  Couple years ago we passed a bill that reformed welfare for people 
who did not have lobbyists. Now we have a family friendly bill that is 
on the House floor, and the reason why I say it is a family friendly 
bill is there have been more lobbyists hired to defend this big 
giveaway of the Federal Government, put more food on the plates of more 
people who were hired to represent the special interests in this 
regard. The fact is this program does not make any money. This program 
only gets money because of transfers of interest payments, 
intergovernment. It would be like arguing that the Department of 
Education makes money on their student loan program. It makes no money.
  It also says to all of my colleagues back in their districts, when 
you have a woman, when you have a man come up to you and tell you they 
want to start a small business and they would like a loan to open up a 
small business, they do not get these kind of sweetheart deals that the 
most profitable large multinational corporations get. Our operations in 
the amount of business we do with China does not involve one dime of 
any of these guarantees.
  The fact is, if these business agreements make sense, let them get 
loans like everybody else does in this country. We do not need 
sweetheart deals, loan guarantees and direct loans from the Federal 
Government to help big business. Big business can compete and win, 
small business can compete and win by having an aggressive strategy to 
market their products, by balancing the budget and having an element of 
fairness.
  So what I would suggest to Republicans as well as Democrats, if they 
marched to this floor and they voted for welfare reform bill that 
reformed the welfare programs for people who do not have lobbyists, it 
is time to come to the floor and cast a giant vote against corporate 
welfare and for the people who live next door.
  Ms. PELOSI. Mr. Chairman, I yield 2\1/2\ minutes to the distinguished 
gentleman from Connecticut [Mr. Gejdenson], a senior member of the 
Committee on International Relations.
  Mr. GEJDENSON. Mr. Chairman, if the fact that there was a lobbyist in 
this town working on a bill was a reason to vote against it, then I 
guess everybody is going to vote against the tax cut tomorrow because 
the reality is on the merits we cannot beat OPIC. It makes money for 
the Treasury, it pays its own way, and it has created in the range of a 
quarter of a million high paying jobs in America. Where OPIC is 
rightfully prohibited from participating in places like China, when an 
American company goes after a contract, it gets a German Government 
insurance program and has to use German subsidiaries to provide much of 
the working product. The American private sector that is in financial 
instruments of this nature supports OPIC. They are not for its closure.
  This is taking a great racehorse that has won race after race, tying 
up a leg or two and say, gee, it does not run so well any more. If we 
cut the money out of OPIC; it is its own money, it is not taxpayer 
money, it is money that is made in profit on its operations; we will 
end up with an agency that will not adequately be able to monitor its 
own operations. Kill it rather than vote for this amendment; $2.7 
billion in reserves in the Treasury, $52 billion generated in exports, 
a quarter of a million jobs; if this is welfare, where is the welfare 
in this? This is a place where the private sector will not go, it is a 
place the private sector supports our Government's actions. It puts 
American families to work, it keeps us competitive internationally.

                              {time}  1845

  Some people around here talk, posing for holy pictures. This may be 
one: Members stand up and pose that they want to end a Government 
program; but do they not look at the facts if they are going to try to 
do that? Because the facts say this program is good for America, it is 
good for taxpayers, it is good for families that depend on the jobs 
from this very program.
  Reject the amendment. It hobbles a great racehorse that does well for 
our economy.
  Mr. Chairman, I urge Members to defeat this amendment and support a 
program that organizations and men and women in unions and nonunions 
alike benefit from the contracts American corporations get. This is an 
ill-advised amendment that will harm American workers.
  Mr. ROYCE. Mr. Chairman, I yield 4 minutes to the gentleman from New 
Jersey [Mr. Andrews].
  (Mr. ANDREWS asked and was given permission to revise and extend his 
remarks.)
  Mr. ANDREWS. Mr. Chairman, I would like to thank my friend, the 
gentleman from California, for yielding time to me.
  I urge my colleagues to vote in favor of this amendment. Mr. 
Chairman, I think the American people ought to know tonight where their 
money is going. Some of it is going to provide a loan guarantee for 
McDonald's to open restaurants in Brazil. Some of it is going to help 
subsidize the operation of a luxury hotel in Bermuda; or Jamaica, 
excuse me. Some of it is going to help General Electric Co. build a 
light bulb factory in Hungary.
  Mr. Chairman, that is where the American people's money is going 
tonight, courtesy of OPIC. Where we should go tonight is a yes vote in 
favor of this amendment.
  We are going to hear the arguments about the miraculous and wonderful 
things OPIC does. OPIC makes money because they invest in profitable 
deals. Mr. Chairman, if the deals are so profitable, then let OPIC 
proceed as a private firm with private risk and private capital and put 
their money at risk, not the money of the men and women that we 
represent.
  We will hear that OPIC does not cost the taxpayers any money because 
what OPIC brings in is greater than what it puts out every year. The 
Congressional Budget Office disagrees. Its analysis is that if we 
terminated OPIC, over a 5-year period we would save $296 million.
  Mr. Chairman, OPIC also makes money the way another Federal agency 
used to make money. In 1987 the head of that Federal agency said that 
times are bright, good times are ahead, the revenues are rolling in. 
The head of that agency was the head of the Federal Home Loan Bank 
Board. He was talking about the savings and loan institutions. The good 
times ended, our money rolled out, and that agency lost

[[Page H6364]]

money, the same way OPIC would if its deals go sour.
  We will hear that OPIC creates lots of jobs. But then we will hear 
the Congressional Research Service say that there is little or no 
empirical evidence to support that claim.
  We will hear that exports for our country will dry up, that we will 
be unilaterally disarming in the war for exports if we get rid of OPIC. 
Here is the evidence. In countries that were eligible for OPIC 
treatment, U.S. firms exported $3.6 billion last year. But in the 
Peoples Republic of China, ineligible for OPIC treatment, without one 
nickel of assistance from OPIC, exports were $52 billion without OPIC. 
Mexico, which is also ineligible for OPIC subsidy, United States 
exports, $28 billion, without a shred of help from OPIC. The evidence 
shows the exports do not increase.
  Finally, we will hear that OPIC is a valuable tool to pursue the 
foreign policy goals of our country. Mr. Chairman, the foreign policy 
goals of our country should be decided and executed by us as the duly 
elected Representatives of the people, and by those who work for the 
President and the State Department, not by a quasi-public taxpayer-
subsidized corporation, which, by the way, has been using its public 
subsidy this week to lobby us against cutting off its funding.
  The letters have arrived, the doors have been knocked on, the 
advertising campaign has begun. For no other reason, for no other 
reason, our colleagues should support this amendment because we do not 
like the idea of people we are funding using that funding to lobby us 
on how to vote.
  Do the American taxpayer a favor. Support our amendment.
  Ms. PELOSI. Mr. Chairman, I am pleased to yield 2 minutes to the 
gentleman from New York [Mr. Rangel], the distinguished ranking member 
of the Committee on Ways and Means, who is working on the tax bill.
  (Mr. RANGEL asked and was given permission to revise and extend his 
remarks.)
  Mr. RANGEL. Mr. Chairman, let me tell Members why I oppose this 
amendment and support OPIC. There is no question that this great 
democracy of ours has been responsible for taking a lot of 
dictatorships, a lot of military governments, and trying to make 
democracies out of them. We have had tremendous success in Africa, 
tremendous success in South America, and the one thing that makes 
democracies work is not just a good feeling, but that people are eating 
and people have jobs and people are doing things. That is what is 
necessary in order to have a democracy.
  What is it that really makes a country not look for aid but is 
willing to be looking for trade? That is where we are looking for 
economic expansion. It is not just love and affection. We want markets 
there to sell our goods. If there is no disposable income, if they are 
only asking for assistance, they cannot buy American goods.
  Take Africa. The President of the United States finally recognized 
that here was a continent that was rich with resources that have not 
been developed. There are people that are skeptical about investing in 
Africa because they think these new young governments are unstable. Now 
comes OPIC and says, we will be there with you. We will give the 
guarantees. Just the President recognizing for trade purposes Africa 
has more than doubled the investments that are there.
  What I am suggesting: Why would we shoot ourselves in the feet where 
the investments have increased when we started having OPIC in Asia, it 
has done well in Latin America, and now comes Africa's chance at bat to 
say we, too, need investment.
  I do not know why when something is working and not losing money, and 
when the American people go and invest that money, and we know we get 
our return because our investors normally are buying American-made 
goods, and if we enrich the people that know that it was America, not 
France and not Germany that was there for them, for God's sake, do not 
tell Africa they have the opportunity to enjoy free trade with us and 
then we encourage American firms not to be there when they need them.
  I oppose the amendment. The thing is working. Let us continue to 
support it.
  Mr. ROYCE. Mr. Chairman, I yield 2\1/4\ minutes to the gentleman from 
Illinois [Mr. Jackson].
  (Mr. JACKSON of Illinois asked and was given permission to revise and 
extend his remarks.)
  Mr. JACKSON of Illinois. Mr. Chairman, if we are serious about 
Africa, we should give direct loan guarantees to the country that we 
are serious about, just like we do for Egypt or for Israel. Direct loan 
guarantees is the way to be serious about investments in these 
countries.
  OPIC, however, is not the vehicle by which we should make these 
investments. The amendment reduces the administrative appropriation for 
the Overseas Private Investment Corporation from $32 to $20.8 million. 
OPIC uses taxpayer money to provide direct loans and risk insurance to 
Fortune 500 companies, who are in turn firing American workers.
  One year ago, the President and this Congress put an end to a six-
decade minimum floor of entitlements for poor people, Aid to Families 
with Dependent Children, or AFDC. In my judgment, that minimal 
entitlement was justified on the basis of simple humanity and basic 
morality. But that view was defeated, and the minimum floor was pulled 
from underneath the poor.
  Yet, the corporations, many of whom have been lobbying us all week 
long, want to continue their AFDC program, or aid for dependent 
corporations, with their record profits and management salaries and 
benefits. They have no such humanitarian claim or moral claim to this 
particular subsidy. The cost to American taxpayers and workers simply 
cannot be justified.
  OPIC bestows upon these corporations welfare through direct loans, 
subsidized loan guarantees, and political risk insurance. Imagine that, 
a Fortune 500 company needing political risk insurance in a Third World 
country.
  With the full faith and credit of the U.S. Government and backing of 
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 these incentives for America's corporate giants to invest 
abroad, taking advantage of low-wage costs, lower standards, and often 
exploitive working conditions of the Third World.
  Mr. Chairman, in the final analysis, we must raise their standards, 
the standards of people in the Third World, not lower ours to meet 
theirs in an increasingly global economy. Mr. Chairman, if we are 
serious about Africa and serious about the Third World, let us give the 
same kinds of loan guarantees to African nations that we also give to 
Israel and to Egypt. That is fair. Vote in support of the Royce-
Andrews-Kasich amendment.
  Mr. CALLAHAN. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman 
from Illinois [Mr. Manzullo].
  Mr. MANZULLO. Mr. Chairman, OPIC provides a unique service to this 
country. It provides political risk insurance. That does three things: 
currency and convertibility, political violence, and seizure of assets. 
That is pretty unusual.
  There is a statement made that OPIC, if it is really great, can be 
privatized. The answer is no. I have a letter here from Zurich 
Insurance Group that is addressed to me in direct response to a Dear 
Colleague letter sent around by the gentleman from California [Mr. 
Royce] and the gentleman from Ohio [Mr. Kasich] asking if Zurich 
America intends to enter the same market as that of OPIC, if OPIC is 
eliminated. The answer to that is no.
  Sean Cassidy, the vice president of Federal Affairs, said that Zurich 
does not intend to compete directly with OPIC, but rather, complement 
OPIC's coverage. So, therefore, there is no company that is ready to 
pick up OPIC should it be privatized.
  Second of all, here is how OPIC makes money. This is Price 
Waterhouse's statement for the past year. OPIC takes in $299,000, and 
here it comes, through political risk insurance premiums, that is $81 
million, investment financing, $52 million, interest on U.S. Treasury 
securities, $166 million. Even if we take out the interest on the U.S. 
Treasury securities, it still comes up making about $45 million a year. 
It actually makes money. OPIC makes money and it provides an insurance

[[Page H6365]]

service that nobody else can provide in this country.
  What amazes me is the fact that OPIC steps into very unique 
situations and makes projects nobody else can do. Look what is going on 
just in Africa alone: In Uganda, Agro Management; in Tanzania, NBS Card 
Service in Africa; in Ethiopia, the Louisiana-Baton Rouge Schaffer & 
Associates; in Tanzania, a small business with ACG Co.; with Tanzania 
suppliers, ADCO.
  All over Africa we see OPIC stepping into the gap, so we have small, 
emerging companies that are getting a foothold, and then after a while, 
such as in Hungary, OPIC backs out because it is no longer necessary to 
have political risk insurance, because when a country becomes a member 
of OECD it no longer is eligible for political risk insurance under 
OPIC.
  So we have an organization here that actually makes money; not on 
paper, it actually makes money. We would urge the defeat of that 
amendment.
  Mr. ROYCE. Mr. Chairman, I yield 2 minutes to the gentleman from 
Texas [Mr. Paul].
  Mr. PAUL. Mr. Chairman, I thank the gentleman for yielding time to 
me. This is a form of welfare that should be stopped. We have poor 
man's welfare, foreign welfare, and corporate welfare. This is an 
example of foreign and corporate welfare. The program really ought to 
be abolished.
  If it is true that this program pays its own way, then there is no 
need for us to be here. Why are they asking for $32 million? It is a 
good program. Some insurance company will take it over.

                              {time}  1900

  Obviously, they need the $32 million that is in here. But there is 
something else involved here that is very, very important. On the very 
chart that was standing here a minute ago, it was showing that they do 
fabulously, this tremendous income of $299 million in 1996, which is 
true. But in looking at this Price Waterhouse balance sheet, financial 
report for 1996, it shows that OPIC owns $2.47 billion worth of bonds. 
Right above it, as a matter of fact, the line went through it, so you 
could not read it, it said that the income from these treasuries was 
$166 million. That is what it is costing the taxpayers.
  We are giving a subsidy to OPIC in the back door by paying interest. 
It appears on the budget as an interest payment. I mean this is really 
close to outright deception on the part of many here in the Congress as 
well as the American people. So it is not paying its own way.
  The other argument, we heard it expressed several times now, is that 
this is a very necessary program because it goes where the private 
market will not go. That is precisely the reason we should not be 
there, because there is a risk. The businessman will not go there 
because it is too risky.
  So what do we do? We ask the American taxpayers to back it up. What 
to do? To take our businesses from this country, export the business 
and export the jobs. Most of this money goes to big companies. If we 
look at their record over the past 6 years, these big companies have 
had a significant shrinkage of employment. These jobs are going 
overseas. Programs like this serve to export jobs, and this amendment 
should be passed.
  Ms. PELOSI. Mr. Chairman, I yield 10 seconds to the gentleman from 
Nebraska [Mr. Bereuter].
  Mr. BEREUTER. Mr. Chairman, we are allowing OPIC to spend money that 
they have earned. This is not a new appropriation.
  Ms. PELOSI. Mr. Chairman, we have had considerable interest on our 
side on this issue. Members were not aware that there was going to be a 
time limitation on this. I ask unanimous consent for 10 additional 
minutes on this side in opposition to the OPIC amendment.
  The CHAIRMAN. The Chair is only able to entertain such a request if 
it is 10 additional minutes for the proponents and opponents. Is that 
the gentlewoman's request?
  Ms. PELOSI. Yes, Mr. Chairman.
  The CHAIRMAN. The Chair's understanding of the request is 10 
additional minutes for the opponents and 10 additional minutes for the 
gentleman from California [Mr. Royce].
  Is there objection to the request of the gentlewoman from California?
  There was no objection.
  Ms. PELOSI. Mr. Chairman, I yield 2 minutes to the gentleman from 
Ohio (Mr. Traficant).
  (Mr. TRAFICANT asked and was given permission to revise and extend 
his remarks.)
  Mr. TRAFICANT. Mr. Chairman, I want to talk about a different aspect. 
After encouragement from the White House themselves, a company in my 
district, Buchite International, is the only American company to agree 
to be a model company for investment in Gaza. Mr. Chairman, they have 
been ripped off big time, and we cannot allow this to happen.
  In their dealings with the Cairo Amman Bank of Gaza, the corporate 
accounts were opened without proper documentation. Corporate checks 
denominated in dollars were endorsed and cashed by individuals without 
first being deposited into the account.
  Canceled checks were not returned. Corporate funds in excess of 
$100,000 were used to guarantee an overdraft facility of a private 
individual without authorization. The company had no knowledge or 
approval of this. A letter of guarantee was written by a bank without 
notifying the company, in strict violation of company instructions. 
Four point four million was invested, forcing them to default on a $2 
million loan.
  Tomorrow I will be bringing an amendment and there may be some 
technicalities to that amendment. I want the Congress to allow that 
amendment to go forward because the PLO and Palestinian authorities 
cannot rip off American companies. We cannot tolerate that. Vote your 
conscience on any of these amendments.
  Mr. ROYCE. Mr. Chairman, I yield 2 minutes and 15 seconds to the 
gentleman from New Hampshire [Mr. Bass].
  Mr. BASS. Mr. Chairman, I rise in strong support of the pending 
amendment which would reduce the OPIC account by 11.2 million. Let me 
emphasize this is not abolition of OPIC. This is a reduction in the 
administrative account. If I may quote from a letter from my 
distinguished colleague from California, he states here that OPIC uses 
taxpayers fund to provide loans, and the amendment would bring OPIC's 
administrative appropriation in line with its stated administrative 
cost.
  According to OPIC, administrative expenses were 20.2 million in 1994. 
Even though OPIC has the same insurance and loan caps as it had in 
1994, it has requested a 50 percent increase in appropriations from 
what administrative costs were in 1994.
  It is a simple question of whether or not this corporation can 
operate with the same workload as it did in 1994, with the same 
administrative overhead.
  We have heard about the fact that the loans are going to Fortune 500 
companies that only 3 percent or three loans went to small businesses 
and 41 went to the Fortune 500 companies. But aside from subsidizing 
these megacorporations, OPIC has risked over $8.7 billion in U.S. 
taxpayers money by underwriting risky investments in unstable regions 
of the world. Let me remind my friends that, should political unrest 
and turmoil upset these foreign markets, American taxpayers will be 
liable for the losses of OPIC insured corporations.
  I heard one of my colleagues mention earlier, remember that the FDIC 
and the FSLIC could never go wrong. They always would make money and we 
know what happened in the savings and loan fiasco.
  Mr. Chairman, OPIC is not contributing to reducing the deficit. The 
resources that come from the OPIC premiums that are received do not go 
into the Treasury. They go, as they should, to income, to a capital 
account to reduce the probability or possibility that there will be a 
default.
  Mr. Chairman, I urge my colleagues to join the Americans for Tax 
Reform, Capital Watch, Citizens Against Government Waste, Citizens for 
a Sound Economy, Competitive Enterprise Institute, Friends of the 
Earth, National Taxpayers Union, Public Citizens and USPIRG in 
supporting this amendment.
  Mr. CALLAHAN. Mr. Chairman, I yield 2 minutes and 30 seconds to the 
gentleman from New York [Mr. Gilman], chairman of the Committee on 
International Relations.

[[Page H6366]]

  (Mr. GILMAN asked and was given permission to revise and extend his 
remarks.)
  Mr. GILMAN. Mr. Chairman, I rise in opposition to the amendment being 
offered by the gentleman from California [Mr. Royce] making a 35 
percent cut in the operating budget of the Overseas Private Investment 
Corporation. The funds in OPIC's $32 million administrative budget are 
fully offset revenues from those companies utilizing OPIC services.
  I might add that the revenue has been increasing each and every year. 
In short, the cutting amendment does not save $1 of taxpayer funds.
  My colleagues should be aware that each year for the past two decades 
the premium and fee income from OPIC's programs have covered all of its 
operating costs. The adoption of this amendment would simply reduce the 
use of OPIC's own revenues. This amendment prevents OPIC from properly 
managing its $23 billion portfolio of insurance policies, of loan 
guarantees and loans to American businesses.
  While OPIC has some $2.7 billion in reserve to protect the U.S. 
taxpayer, this amendment would not allow OPIC to use enough of its 
reserve funds to support its portfolio. In short, it is penny-wise and 
pound-foolish and will put the American taxpayer at risk.
  By depriving the agency of administrative funds for next year, it 
will put thousands of jobs at risk and will stop any effort to develop 
new trade and investment initiatives in sub-Saharan Africa. OPIC does 
not cost a single taxpayer dollar. OPIC is required by law to operate 
on a self-sustaining basis. And since 1971, OPIC has reimbursed the 
government for every dollar of actual outlays it has received. Every 
objective review of OPIC's operations undertaken over the past two 
years by the CRS, J. P. Morgan and independent accounting firms and the 
General Accounting Office concluded that risky markets still exist 
where the private sector is reluctant to operate without public 
guarantees and insurance, such as those provided by OPIC.
  This agency has a proven track record of experiencing few claims 
losses and recovering a large portion of its claims. All of our major 
trading partners have insurance and export financing agencies like 
OPIC. Taking us out of the export and investment assistance business is 
tantamount to unilateral disarmament of our American investment 
overseas. I urge defeat of the measure before us.
  Mr. CALLAHAN. Mr. Chairman, I yield 1 minute to the gentleman from 
Nebraska [Mr. Bereuter].
  Mr. BEREUTER. Mr. Chairman, both the gentleman from New Hampshire and 
the gentleman from New York have talked about the administrative cost 
increases. Let me point out that the size of the loan portfolio has 
grown dramatically because of the mandate of Congress in 1994.
  Take a look at the green bar chart. This shows the escalation of 
administrative costs from $19 to $32 over this period of time. But look 
at the loan portfolio they are managing: $160 up to $260, $310. 
Actually they have been very, very conservative in the amount of money 
they have spent for administrative costs. They have done that despite 
having an authorization to manage this well. They have managed it well. 
They are doing a good job. We ought to continue to support them, to 
implement the congressional mandate.
  Mr. ROYCE. Mr. Chairman, I yield 2 minutes to the gentleman from 
California [Mr. Campbell].
  (Mr. CAMPBELL asked and was given permission to revise and extend his 
remarks.)
  Mr. CAMPBELL. Mr. Chairman, equity in our approach to welfare, safety 
for the American taxpayer, and sending the right signal to those 
countries that have not yet provided a reliable place for investment in 
the world, these are the three arguments that compel support for this 
amendment.
  Equity. We have with difficulty struck down welfare program after 
welfare program or restricted it. We must be prepared to do the same 
when it comes to an aspect of corporate welfare, an aspect of 
favoritism for those companies who cannot stand on their own.
  A question of risk. The chart that I have to my left is prepared by 
the Congressional Budget Office. That does a risk rating of the loans 
which are being insured by OPIC. It should not surprise us when we look 
at it to see such a concentration of these loans at the risky end of 
the spectrum, D, D minus, E, F, F minus. Why should it not surprise us? 
Because by definition OPIC is offering insurance for loans that were 
not otherwise able to be insured in the market.
  Finally, sending the correct signal. There is something important 
that the market tells us when the market says it will not insure an 
investment in a country. It tells us that that country has not yet 
established its economic or governmental structure in such a way as to 
attract investment. And by affording insurance anyway, which the United 
States does through OPIC, we are sending a message and actually 
deterring, retarding the progress that that country might otherwise 
make. Driven by the necessity of coming into the world standard so that 
it would attract the type of insurance that would be available in the 
private market, fairness to all welfare recipients, safety for the 
American taxpayer, and sending the right signal to countries that have 
far to go, all compel a ``yes'' on the Royce amendment.
  Ms. PELOSI. Mr. Chairman, I yield 1 minute to the gentleman from 
Illinois [Mr. Davis].
  Mr. DAVIS of Illinois. Mr. Chairman, not very often will my 
colleagues find me taking a position that is contrary to that of my 
colleague from Chicago. But I rise in opposition to the amendment to 
cut OPIC.
  I do so because we are a pace setter. We are a Nation that is known 
as a leader. We have been a leader in business and industry all over 
the world. I have been told that you cannot lead where you do not go, 
just as you cannot teach what you do not know.
  If I know one thing, I know that if our corporations, if our 
companies, if our businesses are not there in the marketplace, then I 
know that they cannot do business.

                              {time}  1915

  And so that I urge that we oppose this amendment and let OPIC do its 
job, do its work, do its business.
  Mr. ROYCE. Mr. Chairman, I yield 2 minutes to the gentleman from 
Connecticut [Mr. Shays].
  Mr. SHAYS. Mr. Chairman, this Congress in the last 2\1/2\ years has 
sought to balance the Federal budget and get our country's financial 
house in order. We have sought to save our trust funds for not just 
future generations but present generations. And, thirdly, we have 
attempted as hard as we can to transform our caretaking, social, 
corporate and agricultural welfare state into a caring opportunity 
society.
  We have worked hard to help mothers get work, a opportunity for 
employment and training to be free from welfare. We have seen an 
agricultural bill, the Freedom to Farm, wean farmers off welfare. And 
yet when it comes to corporate welfare, we seem to find every defense 
possible to continue it.
  This amendment is not going to eliminate OPIC, it is going to reduce 
its administrative costs. There are some of us who would sincerely want 
to eliminate OPIC, totally privatize this operation. But, Mr. Chairman, 
this is a modest amendment. I support it. It is in line with everything 
we have attempted to do in transforming our caretaking, social, 
corporate and agricultural welfare state into what must become a caring 
opportunity society.
  Ms. PELOSI. Mr. Chairman, I yield 1 minute to the gentleman from 
California, Mr. Brad Sherman.
  (Mr. SHERMAN asked and was given permission to revise and extend his 
remarks.)
  Mr. SHERMAN. Mr. Chairman, I wish to address those who call OPIC 
corporate welfare.
  We should remember who creates the risk in the first place. When the 
terrorists take the plane, they do not shoot the Norwegians first. They 
go after Americans because we play a prominent role in the world. And 
when rogue countries think of nationalizing assets, they do so because 
of American foreign policy and they threaten American assets first. We 
have an opportunity to insure our companies from risks that we as a 
government create.
  There are those who say that OPIC is the next S&L mess. This 
amendment is an opportunity to make that a self-fulfilling prophecy. If 
we cut the administrative costs, if we cut the safeguards, if we cut 
those who are watching to

[[Page H6367]]

make sure that sound loans and guarantees are made, then we can sit 
back and laugh as mistakes are made, and sit back and say, ``We told 
you they would make mistakes.''
  Mr. ROYCE. Mr. Chairman, I yield 2\1/4\ minutes to the gentleman from 
Florida [Mr. Miller].
  Mr. MILLER of Florida. Mr. Chairman, I thank the gentleman for 
yielding me this time and I rise in support of this amendment.
  I wish to reiterate an important point. The amendment does not 
eliminate OPIC. It merely reduces OPIC's administrative expenses down 
to a fiscally responsible level.
  I am speaking on behalf of this amendment today because I believe 
subsidizing large corporations represents corporate welfare. Large 
multinational companies simply should not receive special treatment 
from the Federal Government.
  I ran for Congress with the hope of reducing the size and scope of 
the Federal Government. But how can we ask one sector to accept cuts in 
Federal subsidies if we are not applying this practice fairly? Like the 
special interest groups, big business has to wean itself off the 
Federal dole as well.
  In order to successfully reduce the size of government, every single 
line item that the Federal Government funds needs to be reviewed. These 
items need to meet three criteria: First, is the Federal program 
achieving its goal? Second, does it represent a true Federal priority? 
And, third, does it duplicate other existing Federal or private 
initiatives?
  The Overseas Private Investment Corporation does not meet these 
criteria. To begin with, the program is not meeting its intended goals. 
Originally developed to help small domestic businesses compete 
internationally, OPIC funds are instead diverted towards multinational 
corporations that do not need special subsidies.
  Second, this program does not represent a true Federal priority. 
Funding biomedical research to save people from life-threatening 
disease is a vital priority. Supplying weaponry and soldiers to keep 
this country safe is a Federal priority. However, providing corporate 
giveaways to large multinational companies in no way represents a 
Federal priority.
  And finally, OPIC competes with and effectively crowds out private 
sector initiatives. Companies such as Exporters Insurance Company 
Limited, Zurich American Insurance Group, both provide risk insurance 
at competitive rates and terms without using hard-earned taxpayer 
financing.
  For these reasons I encourage support of this amendment. This is not 
a needed Federal responsibility. There is a private sector alternative. 
We should support this amendment.
  Mr. CALLAHAN. Mr. Chairman, I yield 1 minute to the gentleman from 
Illinois [Mr. Manzullo].
  Mr. MANZULLO. Mr. Chairman, I just heard my colleague from Florida 
say that Zurich American is ready to take over OPIC, and I put into 
testimony a letter from Zurich American. They are not interested in 
taking over OPIC. Zurich American does not want to take over OPIC. We 
cannot privatize it because no one wants to go into that market, 
period. That should settle that argument.
  Second of all, this is the rate of loss. It is 1 percent. It is one 
of the smallest rates of loss that any company can have. And it is not 
corporate welfare because American companies, multinational 
corporations, if they do business in more than one country they are 
multinational, they have to pay very high premiums to buy this 
insurance. It is the premium risk insurance that accounts for most of 
the profits that OPIC turns back.
  Fourthly, today we are here not to get any new money from the 
government treasury for OPIC but to use the money that OPIC has made in 
terms of profits.
  Mr. BEREUTER. Mr. Chairman, will the gentleman yield?
  Mr. MANZULLO. I yield to the gentleman from Nebraska.
  Mr. BEREUTER. Mr. Chairman, I wanted to say, with all that risk 
assessment we had from the gentleman from California [Mr. Campbell], 
that the recovery rate is 98 percent. Ninety-eight percent recovery 
rate.
  Mr. ROYCE. Mr. Chairman, I yield 2 minutes to the gentleman from 
Maryland [Mr. Ehrlich].
  Mr. EHRLICH. Mr. Chairman, I thank the gentleman for yielding this 
time to me.
  Mr. Chairman, a lot of us came to Congress to stop the endless growth 
in government, and we talk an awful lot about it, restoring a sense of 
common sense to what we do in this town. As an effort to accomplish 
those objectives, a lot of us have focused on flawed and nonsensical 
programs such as OPIC.
  At the risk of being redundant, we have heard a lot of reasons to 
eliminate OPIC here today. It is risky, its portfolio has grown 
dramatically over the last several years, it is biased towards large 
Fortune 500 companies, it crowds out other entities in the market, it 
duplicates the products of private lenders and insurers. For those 
interested in the market, I should add. And it is unnecessary.
  Emerging markets attracted $243 billion in private investment in 
1996. OPIC financed $2.2 billion. These are sufficient reasons to 
eliminate OPIC, but what we are debating here today is simply the 
increase of administrative costs, and I rise in support of this more 
limited objective, in support of the Royce-Kasich amendment.
  Make no mistake about it, there is no reason to increase OPIC's 
administrative budget. In fiscal year 1994, as has been stated, OPIC's 
current insurance and loan caps were established. OPIC's administrative 
expenses were $20.2 million. Even though OPIC has the same insurance 
and loan caps today as it had in 1994, it requested a 50 percent 
increase in appropriations above that 1994 level.
  Since OPIC is not authorized to increase higher levels of insurance 
or loans and is a self-financed agency, there is no need to increase 
appropriations for OPIC's administrative expenses.
  Mr. Chairman, at a time when Americans, in fact we are celebrating 
the fact that the government has been asked to do less and cut wasteful 
government spending, OPIC should not ask this Congress to do more. It 
makes no sense. Support the amendment.
  Ms. PELOSI. Mr. Chairman, I yield 1 minute to the gentlewoman from 
Texas [Ms. Jackson-Lee].
  (Ms. JACKSON-LEE of Texas asked and was given permission to revise 
and extend her remarks.)
  Ms. JACKSON-LEE of Texas. Mr. Chairman, I thank the gentlewoman from 
California for yielding this time to me, and I am saddened that I have 
to disagree with my other friend from California.
  But let me say this in rebuttal to all I have heard about OPIC. It 
does creates jobs. In fact, if we look right over here, we will see 
that a single project has created some 260 suppliers across the Nation. 
It creates small business opportunities and it does create jobs. At the 
same time, we will see this whole list of small business owners who are 
working because of OPIC.
  How much can we realize that this is actually an opportunity for 
American businesses to do international business? Why would we shackle 
the hands of business to go across the Nation, to go across 
internationally, to go into Africa and India and China and result in 
dollars that come back to this country, where those who are in small 
businesses and elsewhere pay the taxes that make this government run?
  Do not shackle the hands of those who are working internationally. 
Let us stand proud and make sure that we continue to create job 
opportunities and jobs for the citizens of America through small 
business.
  Ms. PELOSI. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman 
from Texas [Mr. Bentsen].
  (Mr. BENTSEN asked and was given permission to revise and extend his 
remarks.)
  Mr. BENTSEN. Mr. Chairman, this is a penny-wise and pound-foolish 
amendment that is based on a flawed understanding of classical 
economics, and it actually has some tinges of mercantilism. It believes 
in a perfect world, and the fact is it is not a perfect world.
  When we look at the facts we will find that the United States 
provides export subsidies amounting to about 3 percent of our exports, 
but the rest of the world, or many of our trading competitors, provide 
anywhere from 20 to 40 percent subsidization. So we are already dealing 
at a disadvantage in that case.
  Second of all, this theory that this is somehow where the private 
sector

[[Page H6368]]

would go is, I think, very flawed as well. Because what we are talking 
about is lending the credit of the United States under a very 
controlled program, with losses that the gentleman from Nebraska 
pointed out are lower than most American mortgage pools are, and the 
recovery rate better.
  The fact is the private sector will not go into these areas. If we 
are going to start believing in this theory, let us not stop here. Let 
us go after student loans and FHA, because that is the same theory as 
we are applying in that case.
  Do we really want to walk away from emerging markets and have U.S. 
businesses walk away from that? There is no proof whatsoever, no proof 
provided by Americans for Tax Reform, or any other group that we have 
asked for, that there is crowding out of the market. That in and of 
itself is a flawed theory, that somehow we have reached our full 
capacity utilization, when we know that we have not.
  So this is a bad amendment, it is a bad idea, it is bad for the 
American economy, and I hope our colleagues will vote it down.
  Mr. ROYCE. Mr. Chairman, I yield 2 minutes to the gentleman from 
California [Mr. Rohrabacher].
  Mr. ROHRABACHER. Mr. Chairman, this idea that OPIC is creating jobs 
in the United States is so much nonsense I can hardly contain myself. 
We are talking about taxing the hardworking people of the United States 
in order to provide loan guarantees and subsidies for people who, not 
that they want to sell products overseas, but so that they can build 
manufacturing units overseas.
  For people that want to know what that means, that means we are 
building companies that will compete with Americans and put Americans 
out of work and we are taxing the American people to do it. This is 
absurd. This is a sin against average American working people.
  Furthermore, what kind of countries are we talking about? These are 
not struggling democracies we are trying to encourage investment in. 
These are dictatorships. These are bloody gangster regimes that cannot 
get private sector financing because it is too risky.
  Now, of course, by getting the American taxpayers to pony up the 
money, to take all the risk, are we encouraging those gangster regimes 
to liberalize? Not only are we putting our people out of work, we are 
telling the gangsters to go ahead and suppress their unions, go ahead 
and suppress freedom of speech, go ahead and suppress competition, let 
our businessmen in, because we are going to subsidize them.

                              {time}  1930

  This is horrendous. We are taking away the incentive for 
dictatorships to liberalize and become free. We are taking jobs away 
from our people. The only thing wrong with the Royce amendment is that 
it does not go far enough, it does not eliminate this abomination from 
the budget altogether, this attack on the well-being of the American 
people.
  I am with the gentleman from California [Mr. Royce]. Let us cut it 
down if not eliminate it.
  Ms. PELOSI. Mr. Chairman, I am pleased to yield 1 minute to the 
gentleman from Oregon [Mr. Blumenauer].
  Mr. BLUMENAUER. Mr. Chairman, I thank the gentlewoman from California 
[Ms. Pelosi] for yielding me the time.
  It is disingenuous at best to suggest that a vote for this amendment 
is going to save one dime of taxpayer money. There is a big difference 
between subsidy and public guarantee. There are some things that are 
desirable that no individual company is going to take on themselves.
  Other countries have similar tools because they work. And in fact, 
there are a number of countries that invest far more proportionately 
than we do. Cutting this administrative program off could in fact have 
a perverse effect by putting more of this loan portfolio at risk.
  This amendment betrays a fundamental lack of understanding about how 
the program works. In terms of the notion of crippling our ability to 
oversee and manage this larger portfolio, it could have the perverse 
effect of losing taxpayer money and have these guarantees kick in. And 
last, but not least, it would make it impossible to enable this agency 
to move into some of the riskier markets where we need the power of the 
free market to help transform this society.
  Mr. ROYCE. Mr. Chairman, I yield 1 minute to the gentleman from 
Illinois [Mr. Jackson].
  (Mr. JACKSON of Illinois asked and was given permission to revise and 
extend his remarks.)
  Mr. JACKSON of Illinois. Mr. Chairman, let me once again rise to 
challenge a couple of arguments that I heard in support of this 
amendment and certainly congratulate the gentleman from California [Mr. 
Rohrabacher] for an outstanding speech that he just gave. No truer 
words could have ever been spoken in support of this particular 
amendment.
  I want to go back to Africa for a moment, because several of my 
colleagues since I spoke initially indicated that these corporations 
subsequently invest in Africa. In the final analysis, Mr. Chairman, if 
we really trust African leaders, again, we should do for Africa what we 
do for Israel and what we do for Egypt, give them direct loan 
guarantees.
  Nothing could be more paternalistic than to say that the only way we 
are going to invest in Africa is through a U.S. corporation in an 
undemocratic, un-American regime, and put the U.S. taxpayer dollars at 
high risk if in fact that government is toppled and we find ourselves 
on the wrong side of the human rights equation.
  Once again, Mr. Chairman, I rise in support of the Royce-Andrews-
Kasich amendment. I would encourage my colleagues, particularly those 
colleagues who voted in support of reducing this program in the last 
Congress, an opportunity to vote again on behalf of the side of the 
working people in our own country.
  Ms. PELOSI. Mr. Chairman, I am pleased to yield 2 minutes to the 
gentlewoman from North Carolina [Mrs. Clayton].
  Mrs. CLAYTON. Mr. Chairman, I rise against this amendment. OPIC has, 
since its creation, really protected the U.S. investment it has made 
overseas. Argument can be made, and persuasive arguments have been 
made, as to why perhaps this should not be considered. But that 
persuasive argument, I suggest to my colleagues, can be appropriately 
argued somewhere else other than OPIC.
  Consider these facts: Not one dollar has been used, been lost, as a 
result of the taxpayers' money making administrative costs. In fact, 
OPIC is mandated by Congress to be self-sustaining. It is self-
sustaining, paying for its administrative costs. This amendment would 
deny OPIC the ability to fulfill its 1994 mandate that says raise its 
portfolio from $11.5 billion to $23 billion. The Royce amendment would 
undercut that ability to fulfill that.
  It is not unreasonable to assume that the Government would provide 
risk insurance to allow for countries that do not have the economic 
stability to have jobs in development. That also creates investment 
back here in America, if not jobs, certainly investment that goes back 
into applying for economic development for American jobs and American 
citizens here.
  Mr. Chairman, OPIC supports more than 10,000 new American jobs here 
as a result of that investment. Yes, I was one of those congresspersons 
that my colleague, the gentleman from Illinois [Mr. Jackson] referred 
to, because I know of a company, indeed, that has participated in OPIC, 
will not only take their monies but borrow from OPIC and add more 
monies to make sure their investment is a sound investment in South 
Africa.
  It is working, it is working in countries, not only in South Africa, 
but other countries that want to remove themselves from a dictatorship 
and embrace democracy and have opportunity for economic development. 
This is the right way for America to go. We should be leaders on this. 
Vote no on the Royce amendment.
  The CHAIRMAN. The Chair would inform Members that the gentlewoman 
from California [Ms. Pelosi] has 1 minute remaining, the gentleman from 
California [Mr. Royce] has 2 minutes remaining, and the gentleman from 
Alabama [Mr. Callahan] has 5\1/4\ minutes remaining.
  The gentleman from Alabama has the right to close, preceded by the 
gentleman from California [Mr. Royce].

[[Page H6369]]

  Mr. ROYCE. Mr. Chairman, I yield 1 minute to the gentleman from New 
Jersey [Mr. Andrews].
  (Mr. ANDREWS asked and was given permission to revise and extend his 
remarks.)
  Mr. ANDREWS. Mr. Chairman, I want to thank the gentleman from 
California [Mr. Royce], my friend and colleague, and also the gentleman 
from Ohio [Mr. Kasich], the chairman, for their work on this amendment.
  This week, our constituents are going to have taxes taken out of 
their paycheck. And each week we go home for the weekend they ask us, 
``Congressman, what did you spend my money on this week?
  If my colleagues are prepared to tell their constituents that this 
week they spent their money to help the McDonald's Corp. in Brazil, 
then oppose our amendment. If my colleagues are prepared to tell their 
constituents that this week they spent their money to help the General 
Electric Corp. in Hungary, then oppose our amendment. But if my 
colleagues believe, as we do, that the time has come to have equity in 
the way we disperse welfare and to stop corporate welfare, then support 
our amendment, as so many did in voting to limit OPIC last year.
  Ms. PELOSI. Mr. Chairman, I yield myself the remaining 1 minute.
  Mr. Speaker, I commend and applaud our colleague from California [Mr. 
Royce], whom we all hold in such high regard, for his work in fighting 
corporate welfare. I applaud him and the gentleman from Ohio [Mr. 
Kasich] in their fight against corporate welfare. Indeed, I join them 
in their fight against corporate welfare. But, Mr. Chairman, OPIC is 
not corporate welfare. OPIC does not cost the taxpayer a single dollar.
  Some of the points our colleagues have made in the course of fighting 
this amendment this evening bear repeating. OPIC is required by law to 
operate on a self-sustaining basis. Since 1971, OPIC has reimbursed the 
Government for every dollar of actual outlays it has received. OPIC 
produces a positive cash-flow for the Government because the fees it 
charges clients, companies exceed its total cost.
  OPIC creates American jobs by promoting exports. OPIC has a unique 
foreign policy role, and OPIC levels the playing field in the global 
competition. All of America's major economic competitors have OPIC-like 
agencies to bridge commercial gaps in emerging markets. Let us not tie 
the hands of our companies in the international market. I urge my 
colleagues to vote against the Royce amendment.
  The CHAIRMAN. The gentleman from California [Mr. Royce] has 1 minute 
remaining.
  Mr. ROYCE. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, claims have been made that OPIC is a large benefactor 
of small business; 97.6 percent of the beneficiaries are corporations 
with revenues that exceed $1 million. In fact, only one beneficiary had 
annual revenues less than $2 million.
  Private political risk insurance is regularly advertised in 
publications like The Economist. Recently Exporters Insurance Co. 
offered to reinsure much of OPIC's insurance portfolio at all existing 
terms and conditions.
  Last, we have got $23 billion at risk, taxpayers' dollars at risk. 
CRS says that there are savings if we cut this back. There is a cost, 
according to the CBO, $73 million. There is simply no justification for 
appropriating $32 million to OPIC today. This is a 50-percent increase 
in appropriations from 1994, and no more business being authorized.
  This amendment is about stopping the train. It is about saying that 
the House wants to stay in the future of OPIC, this should not be a 
deal cut in conference committee. This may be the only say this body 
has on the future of OPIC. Vote to hold the train. We are talking about 
a modest reduction.
  Mr. CALLAHAN. Mr. Chairman, I yield myself the balance of my time.
  Mr. PACKARD. Mr. Chairman, will the gentleman yield?
  Mr. CALLAHAN. I yield to the gentleman from California.
  Mr. PACKARD. Mr. Chairman, I appreciate the chairman yielding, and I 
reluctantly speak out against my dear friend, the gentleman from 
California [Mr. Callahan], from my own county, Orange County, where he 
represents. I wanted to speak to that in just a moment.
  But the simple truth is, and I certainly agree with the gentlewoman 
from California that spoke earlier, OPIC is a self-supporting and self-
financed program. It is not a corporate welfare program. It has 
recorded a positive net income for every year it has operated, and it 
operates at no net cost to the American taxpayers. In fact, OPIC 
actually contributes to the Treasury. It provides for these services by 
charging a user fee that completely covers the operation of OPIC.
  In my own home State of California, OPIC has provided support for 
over 40 projects, generating $3 billion in American exports and over 
9,000 jobs. In Orange County, CA, the county where the author of this 
amendment resides and represents, one company alone has provided $1 
billion of American-made services and goods exported and over 3,000 
American jobs just because OPIC has helped them.
  I implore the Members to stand above the political rhetoric and see 
that this amendment is voted for what it is, that is that it is not 
corporate welfare. I urge a no vote on the amendment.
  Mr. CALLAHAN. Mr. Chairman, reclaiming my time, I insert for the 
Record at this point a letter from the Vice President to the Speaker of 
the House.
  The letter referred to follows:

                                           The Vice President,

                                    Washington, DC, July 30, 1997.
     Hon. Newt Gingrich,
     Speaker, U.S. House of Representative,
     Washington, DC.
       Dear Mr. Speaker: I write to express my strong opposition 
     to the Royce-Andrews-Kasich amendment that is scheduled for 
     House floor action Thursday, July 31.
       The Administration believes it is very important to 
     reauthorize Overseas Private Investment Corporation this 
     year. The Royce Amendment would make it impossible to perform 
     its valuable role in supporting American foreign policy and 
     its equally important mission of promoting the 
     competitiveness of American firms in international markets.
       Since it was established in 1971, OPIC has supported over 
     $53 billion in U.S. exports. As Vice President, I have 
     personally witnessed what OPIC can accomplish in countries 
     like Russia to open opportunities for American companies and 
     create jobs for American workers.
       I had meetings this week with Deputy President Mbeki of 
     South Africa which included OPIC participants. OPIC has 
     provided critical support for many foreign policy and 
     developmental initiatives around the world from South Africa 
     to Russia and the Newly Independent States. Most recently, 
     OPIC has been tapped to play an important part in a new 
     Africa initiative sponsored by both the Administration and 
     Members of Congress.
       The Royce Amendment would undermine OPIC's capacity not 
     only to support foreign policy and create American jobs, but 
     also hinder prudent financial management of the existing 
     portfolio and harm OPIC's capacity to level the international 
     playing field while promoting American standards on human 
     rights and workers rights.
       I urge you to oppose this amendment.
           Sincerely,
                                                          Al Gore.

  Mr. Speaker, the Royce amendment is an extremely harmful amendment, 
which is just a back-door attempt to try to kill OPIC in the name of 
corporate welfare. While I know the gentleman from California believes 
very strongly in his crusade against corporate welfare, in the case of 
OPIC he is tilting against the wrong windmill.
  OPIC is not corporate welfare. If anything, OPIC is workfare. The 
truth is that OPIC enables American workers to work hard to take home a 
living wage and to make first-rate products which can be sold to the 
developing world. OPIC creates a market for American products. Sure, 
that helps American companies. But most importantly, it helps over 
30,000 American workers each year who benefit from the OPIC-supported 
projects.
  I have listened to the testimony this afternoon of my colleagues, and 
they are eloquent, and I know their passion and I know where they are 
coming from. I listened to the gentleman from Ohio [Mr. Kasich] talking 
about the fact that this is corporate welfare. Let us save this few 
tens of millions of dollars. Yet, he, just a few hours ago, agreed with 
the President to give $4 billion more than what this bill gives.
  So I think that the gentleman from Ohio [Mr. Kasich] is saving $10 
million while agreeing, on the other hand, to give the President $4 
billion more. And I do not fault him. I voted for his budget 
resolution. And he certainly is doing

[[Page H6370]]

everything he can to ensure that some day we reap a balanced budget, 
and that is my goal as well. But this is not the way to do it.
  This is not an authorization bill to allow OPIC to increase the debt. 
What they are saying is shut down the collection window, that we have 
billions of dollars out here in loans and, therefore, we are going to 
cut their ability to even collect the moneys. And that is absolutely 
wrong. And it is not, I am sure, the intent of the gentleman from 
California [Mr. Royce], but that would be the result of this 
legislation.
  A few years ago, the gentleman from Ohio [Mr. Kasich] came to me and 
said, ``Sonny, there is something wrong with OPIC.'' So I had a study 
made about privatization of OPIC. I pleaded with the gentleman from 
Ohio [Mr. Kasich] to meet with me to discuss the results of that study. 
And 2 years later, he still has not had time to look at the survey that 
we made at his request.
  On the other hand, he has been very busy, he is cutting taxes, he is 
cutting spending, he is doing all of these good things, and I want him 
to continue to do those good things. But I wish some of my colleagues 
would take the time to read the report that we commissioned that 
justifies every dime that is spent at OPIC.
  And speaking of spending moneys, OPIC returns money. What other 
agency of Government do we have that returns money to us every single 
year?

                              {time}  1945

  They are bringing in each year, according to the Treasury reports, 
more than enough money to offset this allocation that we are giving to 
them. They bring in $251 million in profit and they are asking for $92 
million of its own collections to continue their operations. So while I 
certainly respect what the gentlemen are doing, recognize that this is 
not helping General Electric; this is helping the employees of General 
Electric. There is a big, big difference. The French do it. The 
Japanese do it. The Germans do it. So why should we do it is what the 
gentleman is saying. Let me encourage Members to vote against this 
misguided amendment and let us continue the operation of OPIC.
  Mr. ORTIZ. Mr. Chairman, I rise today in support of the Overseas 
Private Investment Corporation and to express my opposition to the 
amendments offered by Mr. Royce and Mr. Paul to H.R. 2159, the FY 1998 
Foreign Operations Appropriations Act. These amendments would do 
nothing but hurt American businesses and American workers.
  Mr. Chairman, at a time when American businesses are facing increased 
competition in the global marketplace, it is inconceivable to me that 
we, the very government charged with helping our businesses, would 
obstruct the most important means to this end. To those who support the 
elimination of OPIC, I implore them to give up the isolationist belief 
that if we ignore foreign trade deficits, they will simply go away. 
Nothing could be farther from the truth! We must engage our competitors 
in the global marketplace or we will become a second place economic 
power.
  Mr. Chairman, there is a reason we have trade deficits with some 
foreign nations--they actively support their businesses to a much 
greater extent than we do. If we cut OPIC, we tie the hands of American 
businesses just as they are poised to step into the ring. My colleagues 
have to understand this essential fact: the global marketplace is not 
going to go away. If we stick our heads in the sand and let foreign 
businesses get the upper hand in the global marketplace, then we are 
turning our backs on our own people and our own future. Let us make no 
mistake, Mr. Chairman, we need OPIC.
  Mrs. KENNELLY of Connecticut. Mr. Chairman, I rise in strong 
opposition to the Royce amendment to cut the Overseas Private 
Investment Corporation. OPIC has been crucial in promoting U.S. 
investment abroad and continued support for the Overseas private 
Investment Corporation is not only smart foreign policy it is sound 
fiscal policy.
  OPIC plays a critical role in our Nation's export strategy, and 
supports important foreign policy initiatives across the globe. A cut 
in OPIC's administrative fees will hamper crucial new investment work 
in Africa and the Caribbean. This new investment will create U.S. jobs, 
and improve stability in developing nations.
  Mr. Chairman, OPIC operates on a self-sustaining basis paid for by 
its program users. In fact, throughout its 26 year history, OPIC has 
supported projects worth $107 billion and has created 225,000 new U.S. 
jobs and $52 billion in exports.
  OPIC is a major vehicle for promoting U.S. foreign and economic 
policy without cost to the taxpayer and I urge mu colleagues to reject 
the Royce-Kasich amendment.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from California [Mr. Royce].
  The question was taken; and the Chairman announced that the noes 
appeared to have it.
  Mr. ROYCE. Mr. Chairman, I demand a recorded vote.
  The CHAIRMAN. Pursuant to the order of the House of Thursday, July 
24, 1997, further proceedings on the amendment offered by the gentleman 
from California [Mr. Royce] will be postponed.
  The Clerk will read.
  The Clerk read as follows:

                  Funds Appropriated to the President


                      trade and development agency

       For necessary expenses to carry out the provisions of 
     section 661 of the Foreign Assistance Act of 1961, 
     $40,000,000: Provided, That the Trade and Development Agency 
     may receive reimbursements from corporations and other 
     entities for the costs of grants for feasibility studies and 
     other project planning services, to be deposited as an 
     offsetting collection to this account and to be available for 
     obligation until September 30, 1999, for necessary expenses 
     under this paragraph: Provided further, That such 
     reimbursements shall not cover, or be allocated against, 
     direct or indirect administrative costs of the agency.


                  Amendment No. 36 Offered by Mr. Paul

  Mr. PAUL. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. Was the amendment printed in the Record?
  Mr. PAUL. Yes, Mr. Chairman, it was.
  The Clerk read as follows:

       Amendment No. 36 offered by Mr. Paul: At the end of title I 
     (page 5, after line 14), insert the following new 
     paragraph:


                          reduction in amounts

       Each amount otherwise provided in this title is hereby 
     reduced to $0.

  Mr. PAUL. Mr. Chairman, earlier in the debate on the previous 
amendment, the gentleman from California [Mr. Rohrabacher] suggested 
that there was one problem with the Royce amendment. He said it just 
does not go far enough.
  I have an amendment that will go far enough to deal with this entire 
problem of corporate welfare. My amendment strikes all the funding from 
title I. This means that the $632 million that goes to the Export-
Import Bank, the $32 million that goes to OPIC and the $40 million that 
goes to the Trade and Development Agency would be struck. This would 
not close these agencies down. We have heard on numerous occasions 
already today that OPIC and other agencies like OPIC are obviously 
self-supporting. If they are self-supporting, they need no more 
appropriations. They can use the current funding, they can be 
privatized. This whole idea that they come with the argument that they 
are self-supporting and self-sustaining and that they make a profit, 
there is no purpose in being here. Why do they come to the American 
people and ask in this particular bill for export subsidies of $704 
million? My amendment would strike the $704 million. These three 
agencies have liabilities of well over $100 billion and this would be 
eliminated.
  One of the reasons the argument is made that these agencies are self-
sustaining is that they hold Treasury bills, which means that they 
receive huge sums of money through the back door through interest 
payments. This money is not appropriated for the specific purpose, but 
as long as they hold Treasury bills they get the interest payments. For 
instance, I mentioned earlier that OPIC in 1996 received $166 million 
in this manner. Self-sustaining, it is not.
  We should really ask if this is good economic policy. Quite frankly, 
it is not good economic policy. It encourages businesspeople to do the 
wrong things at the taxpayers' risk.
  It is mentioned that these programs are available in the private 
sector but they will not go into the risky areas. Obviously not. OPIC, 
for instance, goes into countries, and what the American people have to 
assume is the risk against political risk and economic risk. So if 
these companies go bust, the American taxpayers have to stand behind 
them. We have a misdirection of the economy and the misdirection of 
investment because we get companies to do things more risky than they 
would have otherwise. If they want to go into a more risky area, the 
private insurance would obviously be higher,

[[Page H6371]]

so therefore this is a subsidy to corporations.
  There is no reason why we should support this type of welfare. There 
are several kinds of welfare. We have welfare for the poor, we have 
welfare for the foreigners and we have welfare for the corporations. I 
do not think the correct place to try to solve our problem on welfare 
is to go after the poor man's welfare, but we can go after foreign 
welfare and we can go after corporate welfare, and this is an example 
of corporate and foreign welfare.
  It is said that with these programs there is never any loss to the 
taxpayers. That is a bit of a fallacy, because the loss to the 
taxpayers is when we take the money from the taxpayer, so they are 
losing all the time. Most little people never get benefits from this. 
It is the large corporations that lobby us so heavily to endorse these 
programs. There are not that many loans that default.
  But there is another reason why we do not have that many loan 
defaults, because they quickly renew these loans at different terms. 
There is a lot of generous renewing of loans and therefore the default 
level is very, very low, if we see it at all. But the risk is there. 
The real risk to the American taxpayer is when we tax the Americans to 
go and encourage programs like this. The assumption is made that if we 
do not do it, it will not happen. Maybe not, maybe it will. If it does 
not happen, maybe it is too risky. But most of it still would happen; 
it would be insured in the private sector and many of these programs 
would occur.
  To get up and say A, B, and C company would not have existed and 
could not have done this is not correct because we do not know. The 
other thing we do not know is who suffered from this credit allocation. 
When the Government gets involved in credit allocation, in saying this 
credit is guaranteed and should go in this direction, every time there 
is $10 billion going in that direction, it comes out of the private 
sector and some little guy lost his credit. So obviously the banks are 
going to loan to the people that have a guarantee.
  Another area that we should address here is the subject of who gets 
these loans. For instance, one of the biggest beneficiaries is China. 
Red China gets over $4 billion. That in itself is enough reason to vote 
for this amendment and reject corporate welfare on principle.
  Mr. CALLAHAN. Mr. Chairman, I rise in opposition to the amendment.
  Once again, Mr. Chairman, this amendment is intended to destroy the 
Eximbank which might sound good and might look good on the back of a 
bumper sticker, but it would be a tremendous mistake for literally tens 
of thousands of working American people who are working today as a 
result of the fact that we are doing business in some overseas 
countries. If indeed my colleagues believe that we are not in a global 
economy, then my colleagues ought to do exactly what the gentleman from 
Texas said: build a wall around the United States of America. Let us 
not let anybody in and let us not let anybody out, let us not ship any 
of our equipment overseas.
  Let us talk about General Electric. What kind of generators do 
Members think they use if GE builds a plant in a foreign country? They 
use a GE generator built by American workers, built by American workers 
who take that money home and support their families and support my 
colleagues through their taxes that they pay.
  So if my colleagues want to close down America, if they do not want 
to do business overseas, if they really in their heart believe that a 
global economy is not the future of this country, then my colleagues 
ought to abolish the Eximbank and they ought to abolish OPIC as well.
  But unfortunately, if the gentleman will read the newspapers, watch 
television, look at world affairs, attend some of the committee 
hearings that we have, when we hear the testimony of the Eximbank and 
these various agencies, he will learn that we are exporting our jobs 
overseas by letting them work in Texas, by letting them work in 
Alabama, in California. They are taking that money to their homes and 
we are shipping our generators and our products to them overseas simply 
because we have provided for our businesspeople the same thing that the 
French, the British, the Germans, the Japanese have provided to theirs. 
Not as much, I grant the gentleman. They still give them much more. 
They subsidize theirs. We do not subsidize these.
  So, yes, if the gentleman wants to shut the world down as far as the 
United States is concerned and abolish all these; but it would be very, 
very unwise to do that. I would encourage my colleagues to recognize 
that and to vote against the gentleman's amendment.
  Mr. PAUL. Mr. Chairman, will the gentleman yield?
  Mr. CALLAHAN. I yield to the gentleman from Texas.
  Mr. PAUL. Japan subsidizes 32 percent of their exports and we only 
subsidize a small amount, only 2 percent. So I guess I would be 
complaining a lot more if I lived in Japan because they do so much 
more; but if we look at the economic growth of Japan, now it is less 
than 1 percent and we are doing better. We have economic growth of 4 
percent.
  Mr. CALLAHAN. If I may reclaim my time, that is because they are 
doing too much. We are not doing too much. We are trying to facilitate 
our businesspeople in this country the opportunity to make them 
competitive doing business in foreign countries. If that is wrong, then 
I am wrong. But I am not wrong. The gentleman is wrong in trying to 
abolish this agency.
  Ms. PELOSI. Mr. Chairman, I move to strike the last word, and I rise 
in opposition to the amendment of our distinguished colleague from 
Texas.
  Mr. Chairman, this is a most unfortunate amendment, because it 
strikes right to the heart of eliminating title I of our bill, which is 
an important part of our foreign operations legislation. Eximbank, 
Overseas Private Investment Corporation, Trade and Development Agency 
programs help create more and better-paying U.S. jobs through exports. 
Each of these agencies has a distinct role in the administration's 
effort to increase U.S. exports. Increasing U.S. exports is a major 
pillar of our foreign policy and these agencies help do that. Every one 
of our major industrial competitors have publicly supported 
counterparts to Exim, OPIC and TDA. Virtually all of our competitors 
fund their trade and investment finance agencies at a higher level than 
we do. Failure to fully fund Exim, OPIC and TDA would severely handicap 
our exporters as they battle for market share in the key fast-growing 
markets. Exports create more and higher-paying jobs, support the 
creation of American jobs by promoting exports. Vote against this 
amendment.
  Mr. PAUL. Mr. Chairman, will the gentlewoman yield?
  Ms. PELOSI. I yield to the gentleman from Texas.
  Mr. PAUL. Could the gentlewoman cite the constitutional authority for 
programs like this? Where did we get this authority? When did we get 
involved in doing this? I am confused on that constitutional issue.
  Ms. PELOSI. I would not be able to cite the constitutional authority. 
I know the gentleman is well known for his opposition to any spending 
bills, but I think the question that he asks is an appropriate one to 
ask every Member who speaks on the floor, because these agencies of 
government create jobs and return revenue to our Treasury.
  I would like to address one of the points the gentleman made in his 
remarks. He said if they are so self-sustaining, why are they not 
privatized, or words to that effect.
  I think it is very important that this is part of our national export 
program, that we be able to participate in the program level and have a 
control on the operating expenses so that all of the funds that are put 
to this end are well spent and that they promote the most exports, 
create the most jobs and increase the vitality and dynamism of our own 
economy.
  Mr. PAUL. If the gentlewoman will continue to yield, I think that is 
a noble gesture to mix business and government, but some people are 
hesitant to do that, to supervise what businesses are doing.
  Ms. PELOSI. Reclaiming my time, the point was not to mix business and 
government. The point was to promote U.S. exports abroad and to 
recognize the realities of the global economy, where all of the 
countries, the developed countries of the world and the developing 
countries, are very competitive for the market share out there. It

[[Page H6372]]

is very important for us in those particular instances where, for 
example, OPIC would be necessary, assessing the risk very carefully so 
as not to put the U.S. taxpayers' dollars at an extraordinary risk, but 
where the calibration is such that we need OPIC's participation, or 
Eximbank's participation or TDA's promotion, that we give some 
opportunity to U.S. business to make the playing field more level. As I 
have said in my remarks, we do not come close to what many countries do 
to help promote exports, but at least we can participate in promoting 
exports.
  Mr. PAUL. If the gentlewoman will yield further, I think earlier she 
said that it would be an appropriate question to ask for constitutional 
authority and suggested that this is a good idea, and I would like to 
emphasize that we do it more often.
  Mr. FOGLIETTA. Mr. Chairman, will the gentlewoman yield?
  Ms. PELOSI. I yield to the gentleman from Pennsylvania.
  Mr. FOGLIETTA. I think if the gentleman reads the question, he will 
find that the Constitution calls upon the Congress to promote the 
general welfare of this Nation. I think by increasing trade and 
creating jobs, we are promoting the general welfare of our Nation.
  Mr. PAUL. If the gentlewoman will yield further, this is frequently 
cited as a constitutional authority to do almost anything. But let me 
be specific to point out to the gentleman that we are not dealing with 
the general welfare. We are dealing with the very specific welfare of 
General Electric and other big companies at the expense of the general 
welfare of the taxpayers who are paying the money.
  Ms. PELOSI. Reclaiming my time, I would like to say to the gentleman, 
I keep a very close eye on these agencies. To the extent that I believe 
that they are not promoting the general welfare and that special 
interest is served rather than the public interest, I would be certain 
to join with the gentleman in criticism of those aspects.

                              {time}  2000

  But that is not what the point is here tonight.
  I urge my colleagues to oppose the Paul amendment.
  Mr. BEREUTER. Mr. Chairman, I move to strike the requisite number of 
words.
  Mr. Chairman, I rise in strongest opposition to the gentleman's 
amendment, offered for ideological reasons no doubt. It is devastating. 
It would do draconian levels of damage to the American economy, 
American exporters, American business and American workers. It needs to 
be rejected.
  Mr. Chairman, I yield to the gentleman from Illinois [Mr. Manzullo].
  Mr. MANZULLO. Mr. Chairman, I would cite with authority Article I, 
section 8, clause 3 of the United States Constitution that it is within 
the powers of this body to regulate commerce with foreign nations, and 
if I could make my point, then I would be glad to yield for a question 
from my constitutional friend.
  In what we are doing here with these 3 bodies, Ex-Im, OPIC and TDA, 
are we regulating commerce? You bet we are. We are involved in an 
international global war. If the amendment offered by the gentleman 
from Texas [Mr. Paul] were presented somehow in an international body, 
and I would dread that because we would have a one-world government, 
then I would say let us go ahead and do what he is doing because there 
are 73 export credit agencies, there are 36 international equivalents 
of OPICs. So what that means is that if we get rid of these specialty 
types of credit agencies, where are we? What we have done is we have 
effectively thrown up our hands and we have left it to the Finns and 
Germans to take over.
  Let me give my colleagues an example that is in my backyard, Beloit 
Corporation. There is one of 3 manufacturers of paper making machines, 
3 worldwide manufacturers of paper making machines, engaged in trying 
to get a contract in Indonesia. The only other 2 manufacturers are in 
Europe. One are the Finns and the other one are the Germans, and the 
Finns and the Germans go through extraordinary lengths in order to, if 
my colleagues want to use that word, subsidize, grant favorable 
financing so that these sales can take place.
  So what happened was Beloit Corporation applied to Ex-Im in working 
with Members on both sides of the aisle, including the gentleman from 
Wisconsin [Mr. Barrett] over here from Milwaukee. We were able to see 
Ex-Im grant a $275 million loan guarantee which has to be paid back 
with interest at a good premium for the purpose of making sure that 
Beloit Corporation was put in a level playing field to sell those 
machines. Those were 2 machines that cost over $150 million a piece, 
and there are several more in the lot. Let me finish my thought here.
  Now what is going on here dynamically is this. Worldwide there is an 
effort, there is an effort to eliminate OPIC and Ex-Im types of 
financing. For example the OECD met and said that what we will do is we 
will have an agreement that a Nation can only subsidize the spread; 
that is, the actual amount of interest as charged worldwide on the open 
market with what a Nation wants to pay to a certain extent, and they 
continue to narrow that gap so that nations will be involved in less 
core subsidizing of the loans for the exports.
  Mr. PAUL. Mr. Chairman, will the gentleman yield?
  Mr. BEREUTER. I yield to the gentleman from Texas.
  Mr. PAUL. Let me address the subject of regulation. The Constitution 
does give us the authority to regulate commerce, but it never mentions 
that we should subsidize special interests at the expense of the 
average American taxpayers. Yes, we can put on tariffs and we can 
regulate what comes and goes across our borders, but in the wildest 
dreams of the Founders of this country they never intended that we 
would have programs like this. We have to think this is a concoction of 
the latter part of the 20th century, the past 20 or 30 years. This is 
when this stuff; when welfare-ism has blossomed, it has been these type 
of programs. It was never intended by our Constitution to do these 
programs.
  Mr. BEREUTER. Reclaiming my time, Mr. Chairman, I would say that the 
authorization appropriations are funds that are very much in the 
American taxpayers' benefit. They come out positive as a result 
directly of these jobs.
  Mr. MANZULLO. Mr. Chairman, will the gentleman yield?
  Mr. BEREUTER. I yield to the gentleman from Illinois.
  Mr. MANZULLO. Mr. Chairman, back in those days the main income for 
the United States was international tariffs. We have these incredible 
tariff barriers, and that is how we supported the economy of the Nation 
before the income tax.
  I mean nobody wants those tariffs. I know the gentleman is a 
libertarian and does not like the tariffs, but that is what was going 
on 200 some years ago when the Nation was founded, and I think when 
this was put into the Constitution it says to regulate, meaning this 
body, the United States Congress, is given the power to make sure that 
we can operate internationally.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from Texas [Mr. Paul].
  The question was taken; and the Chairman announced that the noes 
appeared to have it.
  Mr. PAUL. Mr. Chairman, I demand a recorded vote.
  The CHAIRMAN. Pursuant to the order of the House of Thursday, July 
24, 1997, further proceedings on the amendment offered by the gentleman 
from Texas [Mr. Paul] will be postponed.


                             Point of Order

  Mr. BARR of Georgia. Mr. Chairman, I rise to a point of order.
  The CHAIRMAN. The gentleman will state his point of order.
  Mr. BARR of Georgia. Mr. Chairman, I make the point of order that the 
language beginning with ``provided'' on page 24, line 8 through 
``justice'' on line 16 violates clause 2(b) of rule XXI of the rules of 
the House of Representatives.
  The CHAIRMAN. The gentleman from Georgia will suspend. The Clerk has 
not yet read to that portion of the bill, and the gentleman's point of 
order is not in order at this point.
  The Clerk will read.
  The Clerk read as follows:

[[Page H6373]]

                TITLE II--BILATERAL ECONOMIC ASSISTANCE

                  Funds Appropriated to the President

       For expenses necessary to enable the President to carry out 
     the provisions of the Foreign Assistance Act of 1961, and for 
     other purposes, to remain available until September 30, 1998, 
     unless otherwise specified herein, as follows:


                  agency for international development

                child survival and disease programs fund

       For necessary expenses to carry out the provisions of part 
     I and chapter 4 of part II of the Foreign Assistance Act of 
     1961, for child survival, basic education, assistance to 
     combat tropical and other diseases, and related activities, 
     in addition to funds otherwise available for such purposes, 
     $650,000,000, to remain available until expended: Provided, 
     That this amount shall be made available for such activities 
     as (1) immunization programs, (2) oral rehydration programs, 
     (3) health and nutrition programs, and related education 
     programs, which address the needs of mothers and children, 
     (4) water and sanitation programs, (5) assistance for 
     displaced and orphaned children, (6) programs for the 
     prevention, treatment, and control of, and research on, 
     tuberculosis, HIV/AIDS, polio, malaria and other diseases, 
     (7) not to exceed $98,000,000 for basic education programs 
     for children, and (8) a contribution on a grant basis to the 
     United Nations Children's Fund (UNICEF) pursuant to section 
     301 of the Foreign Assistance Act of 1961.


                         development assistance

       For necessary expenses to carry out the provisions of 
     sections 103 through 106 and chapter 10 of part I of the 
     Foreign Assistance Act of 1961, title V of the International 
     Security and Development Cooperation Act of 1980 (Public Law 
     96-533) and the provisions of section 401 of the Foreign 
     Assistance Act of 1969, $1,167,000,000, to remain available 
     until September 30, 1999: Provided, That of the amount 
     appropriated under this heading, up to $2,000,000 may be made 
     available for the Inter-American Foundation: Provided 
     further, That of the amount appropriated under this heading, 
     up to $2,500,000 may be made available for the African 
     Development Foundation: Provided further, That none of the 
     funds made available in this Act nor any unobligated balances 
     from prior appropriations may be made available to any 
     organization or program which, as determined by the President 
     of the United States, supports or participates in the 
     management of a program of coercive abortion or involuntary 
     sterilization: Provided further, That none of the funds made 
     available under this heading may be used to pay for the 
     performance of abortion as a method of family planning or to 
     motivate or coerce any person to practice abortions; and that 
     in order to reduce reliance on abortion in developing 
     nations, funds shall be available only to voluntary family 
     planning projects which offer, either directly or through 
     referral to, or information about access to, a broad range of 
     family planning methods and services: Provided further, That 
     in awarding grants for natural family planning under section 
     104 of the Foreign Assistance Act of 1961 no applicant shall 
     be discriminated against because of such applicant's 
     religious or conscientious commitment to offer only natural 
     family planning; and, additionally, all such applicants shall 
     comply with the requirements of the previous proviso: 
     Provided further, That for purposes of this or any other Act 
     authorizing or appropriating funds for foreign operations, 
     export financing, and related programs, the term 
     ``motivate'', as it relates to family planning assistance, 
     shall not be construed to prohibit the provision, consistent 
     with local law, of information or counseling about all 
     pregnancy options: Provided further, That nothing in this 
     paragraph shall be construed to alter any existing statutory 
     prohibitions against abortion under section 104 of the 
     Foreign Assistance Act of 1961: Provided further, That none 
     of the funds made available under this heading may be used 
     for any activity which is in contravention to the Convention 
     on International Trade in Endangered Species of Flora and 
     Fauna (CITES).


                     Amendment Offered by Mr. Pitts

  Mr. PITTS. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. Has the amendment been printed in the Record?
  Mr. PITTS. Yes.
  The CHAIRMAN. Does the gentleman ask unanimous consent to have his 
amendment considered?
  Mr. PITTS. Yes, Mr. Chairman.
  The CHAIRMAN. Is there objection to the consideration of the en bloc 
amendments?
  Mr. CALLAHAN. There is objection here.
  The CHAIRMAN. Objection is heard.
  The Clerk will read.
       The Clerk read as follows:


                  private and voluntary organizations

       None of the funds appropriated or otherwise made available 
     by this Act for development assistance may be made available 
     to any United States private and voluntary organization, 
     except any cooperative development organization, which 
     obtains less than 20 per centum of its total annual funding 
     for international activities from sources other than the 
     United States Government: Provided, That the requirements of 
     the provisions of section 123(g) of the Foreign Assistance 
     Act of 1961 and the provisions on private and voluntary 
     organizations in title II of the ``Foreign Assistance and 
     Related Programs Appropriations Act, 1985'' (as enacted in 
     Public Law 98-473) shall be superseded by the provisions of 
     this section, except that the authority contained in the last 
     sentence of section 123(g) may be exercised by the 
     Administrator with regard to the requirements of this 
     paragraph.
       Funds appropriated or otherwise made available under title 
     II of this Act should be made available to private and 
     voluntary organizations at a level which is equivalent to the 
     level provided in fiscal year 1995. Such private and 
     voluntary organizations shall include those which operate on 
     a not-for-profit basis, receive contributions from private 
     sources, receive voluntary support from the public and are 
     deemed to be among the most cost-effective and successful 
     providers of development assistance.


                   international disaster assistance

       For necessary expenses for international disaster relief, 
     rehabilitation, and reconstruction assistance pursuant to 
     section 491 of the Foreign Assistance Act of 1961, as 
     amended, $190,000,000, to remain available until expended.


                           debt restructuring

       For the cost, as defined in section 502 of the 
     Congressional Budget Act of 1974, of modifying direct loans 
     and loan guarantees, as the President may determine, for 
     which funds have been appropriated or otherwise made 
     available for programs within the International Affairs 
     Budget Function 150, including the cost of selling, reducing, 
     or canceling amounts, through debt buybacks and swaps, owed 
     to the United States as a result of concessional loans made 
     to eligible Latin American and Caribbean countries, pursuant 
     to part IV of the Foreign Assistance Act of 1961; and of 
     modifying concessional loans authorized under title I of the 
     Agricultural Trade Development and Assistance Act of 1954, as 
     amended, as authorized under subsection (a) under the heading 
     ``Debt Reduction for Jordan'' in title VI of Public Law 103-
     306; $27,000,000, to remain available until expended.


         micro and small enterprise development program account

       For the cost of direct loans and loan guarantees, 
     $1,500,000, as authorized by section 108 of the Foreign 
     Assistance Act of 1961, as amended: Provided, That such costs 
     shall be as defined in section 502 of the Congressional 
     Budget Act of 1974: Provided further, That guarantees of 
     loans made under this heading in support of microenterprise 
     activities may guarantee up to 70 percent of the principal 
     amount of any such loans notwithstanding section 108 of the 
     Foreign Assistance Act of 1961. In addition, for 
     administrative expenses to carry out programs under this 
     heading, $500,000, all of which may be transferred to and 
     merged with the appropriation for Operating Expenses of the 
     Agency for International Development: Provided further, That 
     funds made available under this heading shall remain 
     available until September 30, 1999.


             urban and environmental credit program account

       For the cost, as defined in section 502 of the 
     Congressional Budget Act of 1974, of guaranteed loans 
     authorized by sections 221 and 222 of the Foreign Assistance 
     Act of 1961, including the cost of guaranteed loans designed 
     to promote the urban and environmental policies and 
     objectives of part I of such Act, $3,000,000, to remain 
     available until September 30, 1999: Provided, That these 
     funds are available to subsidize loan principal, 100 percent 
     of which shall be guaranteed, pursuant to the authority of 
     such sections. in addition, for administrative expenses to 
     carry out guaranteed loan programs, $6,000,000, all of which 
     may be transferred to and merged with the appropriation for 
     Operating Expenses of the Agency for International 
     Development: Provided further, That commitments to guarantee 
     loans under this heading may be entered into notwithstanding 
     the second and third sentences of section 222(a) and, with 
     regard to programs for Central and Eastern Europe and 
     programs for the benefit of South Africans disadvantaged by 
     apartheid, section 223(j) of the Foreign Assistance Act of 
     1961.


     payment to the foreign service retirement and disability fund

       For payment to the ``Foreign Service Retirement and 
     Disability Fund'', as authorized by the Foreign Service Act 
     of 1980, $44,208,000.


     operating expenses of the agency for international development

       For necessary expenses to carry out the provisions of 
     section 667, $468,750,000: Provided, That none of the funds 
     appropriated by this Act for programs administered by the 
     Agency for International Development may be used to finance 
     printing costs of any report or study (except feasibility, 
     design, or evaluation reports or studies) in excess of 
     $25,000 without the approval of the Administrator of the 
     Agency or the Administrator's designee.


 operating expenses of the agency for international development office 
                          of inspector general

       For necessary expenses to carry out the provisions of 
     section 667, $29,047,000, to remain available until September 
     30, 1999, which sums shall be available for the Office of the 
     Inspector General of the Agency for International 
     Development.

[[Page H6374]]

                  Other Bilateral Economic Assistance


                         economic support fund

       For necessary expenses to carry out the provisions of 
     chapter 4 of part II, $2,400,000,000, to remain available 
     until September 30, 1999 Provided, That any funds 
     appropriated under this heading that are made available for 
     Israel shall be available on a grant basis as a cash transfer 
     and shall be disbursed within thirty days of enactment of 
     this Act or by October 31, 1997, whichever is later: 
     Provided, That in exercising the authority to provide cash 
     transfer assistance for Israel and Egypt, the President shall 
     ensure that the level of such assistance does not cause an 
     adverse impact on the total level of nonmilitary exports from 
     the United States to each such country.


                     international fund for ireland

       For necessary expenses to carry out the provisions of 
     chapter 4 of part II of the Foreign Assistance Act of 1961, 
     $19,600,000, which shall be available for the United States 
     contribution to the International Fund for Ireland and shall 
     be made available in accordance with the provisions of the 
     Anglo-Irish Agreement Support Act of 1986 (Public Law 99-
     415): Provided, That such amount shall be expended at the 
     minimum rate necessary to make timely payment for projects 
     and activities: Provided further, That funds made available 
     under this heading shall remain available until September 30, 
     1999.


          assistance for eastern europe and the baltic states

       (a) For necessary expenses to carry out the provisions of 
     the Foreign Assistance Act of 1961 and the Support for East 
     European Democracy (SEED) Act of 1989, $470,000,000, to 
     remain available until September 30, 1999, which shall be 
     available, notwithstanding any other provision of law, for 
     economic assistance and for related programs for Eastern 
     Europe and the Baltic States.
       (b) Funds appropriated under this heading or in prior 
     appropriations Acts that are or have been made available for 
     an Enterprise Fund may be deposited by such Fund in interest-
     bearing accounts prior to the Fund's disbursement of such 
     funds for program purposes. The Fund may retain for such 
     program purposes any interest earned on such deposits without 
     returning such interest to the Treasury of the United States 
     and without further appropriation by the Congress. Funds made 
     available for Enterprise Funds shall be expended at the 
     minimum rate necessary to make timely payment for projects 
     and activities.
       (c) Funds appropriated under this heading shall be 
     considered to be economic assistance under the Foreign 
     Assistance Act of 111961 for purposes of making available the 
     administrative authorities contained in that Act for the use 
     of economic assistance.
       (d) None of the funds appropriated under this heading may 
     be made available for new housing construction or repair or 
     reconstruction of existing housing in Bosnia and Herzegovina 
     unless directly related to the efforts of United States 
     troops to promote peace in said country.


                   Amendment Offered by Mr. Campbell

  Mr. CAMPBELL. Mr. Chairman, I have an amendment, No. 27, which I 
believe is germane to the second title of the bill at page 13.
  The CHAIRMAN. Does the gentleman ask unanimous consent to offer the 
amendment at this time?
  Mr. CAMPBELL. That is my request, yes, Mr. Chairman.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
California?
  Mr. CALLAHAN. Yes, Mr. Chairman, I object.
  The CHAIRMAN. Objection is heard.


                         Parliamentary Inquiry

  Mr. CAMPBELL. Parliamentary inquiry, Mr. Chairman.
  The CHAIRMAN. The gentleman will state his parliamentary inquiry.
  Mr. CAMPBELL. Mr. Chairman, I simply wish to know about the 
amendment, page 13, line 4, whereby I am inserting $25 million in the 
Amendment No. 27; my parliamentary inquiry is whether that is in order 
at this time without a unanimous consent request.
  The CHAIRMAN. The Chair would inform the gentleman that the Clerk had 
passed that point in reading the bill and it requires unanimous consent 
to go back to that paragraph.
  Mr. CAMPBELL. Mr. Chairman, I move to strike the last word.
  Mr. Chairman, at the conclusion of striking the last word I am going 
to ask an indulgence of the chairman of the subcommittee, and so I rise 
to speak to this request.
  I was here, I was talking at the desk. It is appropriate at page 13, 
line 4. The members of the Congressional Black Caucus I have summoned 
to be on the floor at this moment. There is every record that I 
intended and had, except for the discussion at this desk, would have 
been able to present it at this moment.
  I ask; it is a favor, I understand, but I have a very specific reason 
for asking for that favor, it is an unusual circumstance. I was here, 
there was discussion, and I could not get to the microphone because we 
were worried that the amendment of the gentleman from Pennsylvania [Mr. 
Pitts] might have had precedence to mine.
  It is for that reason, which is really not a common situation, that I 
would ask a very great favor, but a favor of the chairman of the 
subcommittee that if I renew my unanimous consent request that I might 
now offer the amendment, No. 27, that it might be offered without an 
objection.
  Mr. Chairman, with that I renew my unanimous consent request that 
Amendment No. 27 might be allowed at this time.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
California?
  Mr. CALLAHAN. Yes, Mr. Chairman.
  I recognize the gentleman's plight. Nevertheless, we cannot continue 
to go back because if we go back for him, we have to do the same thing 
for every Member of this body. So I reluctantly still object.
  The CHAIRMAN. Objection is heard.
  The Clerk will read.
  The Clerk read as follows:

       (e) With regard to funds appropriated or otherwise made 
     available under this heading for the economic revitalization 
     program in Bosnia and Herzegovina, and local currencies 
     generated by such funds (including the conversion of funds 
     appropriated under this heading into currency used by Bosnia 
     and Herzegovina as local currency and local currency returned 
     or repaid under such program)--
       (1) the Administrator of the Agency for International 
     Development shall provide written approval for grants and 
     loans prior to the obligation and expenditure of funds for 
     such purposes, and prior to the use of funds that have been 
     returned or repaid to any lending facility or grantee; and
       (2) the provisions of section 531 of this Act shall apply.
       (f) With regard to funds appropriated under this heading 
     that are made available for economic revitalization programs 
     in Bosnia and Herzegovina, 50 percent of such funds shall not 
     be available for obligation unless the President determines 
     and certifies to the Committee on Appropriations that the 
     Federation of Bosnia and Herzegovina has complied with 
     article III of annex 1-A of the General Framework Agreement 
     for Peace in Bosnia and Herzegovina concerning the withdrawal 
     of foreign forces, and that intelligence cooperation on 
     training, investigations, and related activities between 
     Iranian officials and Bosnian officials has been terminated.
       (g) Not to exceed $200,000,000 of the funds appropriated 
     under this heading may be made available for Bosnia and 
     Herzegovina.
       (h) Not to exceed $7,000,000 of the funds made available 
     for Bosnia and Herzegovina may be made available for the 
     cost, as defined in section 502 of the Congressional Budget 
     Act of 1974, of modifying direct loans and loan guarantees 
     for said country.

  Mr. FOLEY. Mr. Chairman, I move to strike the last word.
  Mr. Chairman, I would like to enter into a colloquy with the 
distinguished gentleman from Alabama [Mr. Callahan].
  Mr. Chairman, I recently traveled to Haiti in order to get a 
firsthand look at the political and economic conditions there. It is my 
concern that if the current political and economic impasse in that 
country continues, there could be a social explosion that leads to a 
mass immigration of Haitian refugees to Florida. As certain factions 
inside Haiti are blocking reforms to further their own political 
agenda, vital measures are being stalled that could lead to more 
private investment in Haiti and ultimately to stabilization of this 
country. Economic reform in Haiti, particularly in the privatization of 
state-owned enterprises, is a necessary step in the improvement of 
Haiti's economy.
  During my trip I took particular note of the inaccurate and 
antiquated power and telecommunication systems in Haiti. Without a 
modern infrastructure it is ludicrous to expect that Haiti will attract 
significant private investment. Therefore, the Haitian government must 
privatize these industries.
  It is my understanding, Mr. Chairman, that the Subcommittee on 
Foreign Operations this year has inserted language which emphasizes 
that aid for Haiti is being provided with the clear understanding that 
it will only be provided if the Haitian government is actually 
implementing a meaningful restructuring of the Haitian public sector.

                              {time}  2015

  Am I correct in that assumption?

[[Page H6375]]

  Mr. CALLAHAN. Mr. Chairman, will the gentleman yield?
  Mr. FOLEY. I yield to the gentleman from Alabama.
  Mr. CALLAHAN. Mr. Chairman, the gentleman from Florida is absolutely 
correct. The privatization of parastatal companies and strict 
accountability for the effective use of donor resources are core 
reforms which were promised but not accomplished in prior years.
  The committee recommends that assistance to the government of Haiti 
provided in this act be made contingent upon the privatization of at 
least three parastatal enterprises. I might add that the subcommittee, 
traveled to Haiti and that we shared the gentleman's concern, and we 
also expressed a strong concern to President Preval.
  Mr. FOLEY. Mr. Chairman, let me thank the chairman for the 
clarification, and commend him on his efforts to ensure that the United 
States aid to Haiti is being properly utilized.
  As I witnessed the strength of the people of Haiti and their desire 
to have economic opportunity, it became clear to me that the government 
needs to lead by example. I suggested to President Preval that he take 
a stronger stand in forcing the privatization of the utilities and 
other areas.
  Even if the United States could provide the Haitian government with 
all the money in the world, it would come to no avail without reform of 
the Haitian economy. So I would suggest this Congress and this 
committee has a strong responsibility to work closely with the current 
government in Haiti and try and see that these economic reforms become 
reality, so those people in Haiti can have jobs, opportunity, growth 
and prosperity.
  The CHAIRMAN. The Clerk will read.
  The Clerk read as follows:


  assistance for the new independent states of the former soviet union

       (a) For necessary expenses to carry out the provisions of 
     chapter 11 of part I of the Foreign Assistance Act of 1961 
     and the FREEDOM Support Act, for assistance for the new 
     independent states of the former Soviet Union and for related 
     programs, $625,000,000, to remain available until September 
     30, 1999: Provided, That the provisions of such chapter shall 
     apply to funds appropriated by this paragraph.
       (b) None of the funds appropriated under this heading shall 
     be transferred to the Government of Russia--
       (1) unless that Government is making progress in 
     implementing comprehensive economic reforms based on market 
     principles, private ownership, negotiating repayment of 
     commercial debt, respect for commercial contracts, and 
     equitable treatment of foreign private investment; and
       (2) if that Government applies or transfers United States 
     assistance to any entity for the purpose of expropriating or 
     seizing ownership or control of assets, investments, or 
     ventures.
       (c) Funds may be furnished without regard to subsection (b) 
     if the President determines that to do so is in the national 
     interest.
       (d) None of the funds appropriated under this heading shall 
     be made available to any government of the new independent 
     states of the former Soviet Union if that government directs 
     any action in violation of the territorial integrity or 
     national sovereignty of any other new independent state, such 
     as those violations included in the Helsinki Final Act: 
     Provided, That such funds may be made available without 
     regard to the restriction in this subsection if the President 
     determines that to do so is in the national security interest 
     of the United States: Provided further, That the restriction 
     of this subsection shall not apply to the use of such funds 
     for the provision of assistance for purposes of humanitarian, 
     disaster and refugee relief.
       (e) None of the funds appropriated under this heading for 
     the new independent states of the former Soviet Union shall 
     be made available for any state to enhance its military 
     capability: Provided, That this restriction does not apply to 
     demilitarization or nonproliferation programs.
       (f) Funds appropriated under this heading shall be subject 
     to the regular notification procedures of the Committees on 
     Appropriations.
       (g) Funds made available in this Act for assistance to the 
     new independent states of the former Soviet Union shall be 
     subject to the provisions of section 117 (relating to 
     environment and natural resources) of the Foreign Assistance 
     Act of 1961.
       (h) In issuing new task orders, entering into contracts, or 
     making grants, with funds appropriated under this heading or 
     in prior appropriations Acts, for projects or activities that 
     have as one of their primary purposes the fostering of 
     private sector development, the Coordinator for United States 
     Assistance to the New Independent States and the implementing 
     agency shall encourage the participation of and give 
     significant weight to contractors and grantees who propose 
     investing a significant amount of their own resources 
     (including volunteer services and in-kind contributions) in 
     such projects and activities.
       (i) Funds appropriated under this heading or in prior 
     appropriations Acts that are or have been made available for 
     an Enterprise Fund may be deposited by such Fund in interest-
     bearing accounts prior to the disbursement of such funds by 
     the Fund for program purposes. The Fund may retain for such 
     program purposes any interest earned on such deposits without 
     returning such interest to the Treasury of the United States 
     and without further appropriation by the Congress. Funds made 
     available for Enterprise Funds shall be expended at the 
     minimum rate necessary to make timely payment for projects 
     and activities.
       (j)(1) None of the funds appropriated under this heading 
     may be made available for Russia unless the President 
     determines and certifies in writing to the Committees on 
     Appropriations that the Government of Russia has terminated 
     implementation of arrangements to provide Iran with technical 
     expertise, training, technology, or equipment necessary to 
     develop a nuclear reactor, related nuclear research 
     facilities or programs, or ballistic missile capability.
       (2) Fifty percent of the funds appropriated under this 
     heading that are allocated for Russia may be made available 
     notwithstanding paragraph (1) if the President determines 
     that making such funds available is vital to the national 
     security interest of the United States. Any such 
     determination shall cease to be effective six months after 
     being made unless the President determines that its 
     continuation is vital to the national security interest of 
     the United States.
       (k)(1) Funds appropriated under this heading may not be 
     made available for the Government of Ukraine if the President 
     determines and reports to the Committees on Appropriations 
     that the Government of Ukraine is engaged in military 
     cooperation with the Government of Libya.
       (2) Paragraph (1) shall not apply if the President 
     determines that making such funds available is vital to the 
     national security interest of the United States. Any such 
     determination shall cease to be effective six months after 
     being made unless the President determines that its 
     continuation is vital to the national security interest of 
     the United States.
       (l) Funds made available under this Act or any other Act 
     may not be provided for assistance to the Government of 
     Azerbaijan until the President determines, and so reports to 
     the Congress, that the Government of Azerbaijan is taking 
     demonstrable steps to cease all blockades and other offensive 
     uses of force against Armenia and Nagorno-Karabakh: Provided, 
     That the restriction of this subsection and section 907 of 
     the FREEDOM Support Act shall not apply to activities 
     promoting democracy or assistance under title V of the 
     FREEDOM Support Act and section 1424 of Public Law 104-201: 
     Provided further, That none of the funds appropriated or 
     otherwise made available under this Act may be utilized by 
     the Export-Import Bank of the United States, the Overseas 
     Private Investment Corporation, or the Trade and Development 
     Agency to provide financing (including direct loans, loan 
     guarantees, and insurance) or other assistance contrary to 
     the provisions of section 907 of the FREEDOM Support Act.
       (m) Funds appropriated under this heading shall be made 
     available for humanitarian assistance through nongovernmental 
     organizations for refugees, displaced persons, and needy 
     civilians in conflictive zones throughout the Trans-Caucasus, 
     including Nagorno-Karabagh, notwithstanding any other 
     provision of this or any other Act.
       (n) Of the funds appropriated under this heading that are 
     allocated for Ukraine, 50 percent shall be withheld from 
     obligation and expenditure until the Secretary of State 
     certifies to the Committees on Appropriations that the 
     Government of Ukraine: (1) is enforcing the April 10, 1997 
     Anti-Corruption decree of President Kuchma; (2) has 
     substantially completed the privatization of state owned 
     agricultural storage, distribution, equipment and supply 
     monopolies; and (3) has fully resolved most of the commercial 
     disputes involving complaints by United States investors to 
     the Embassy in Kiev as of April 30, 1997 and established a 
     permanent legal mechanism for commercial dispute resolution.

                          Independent Agencies


                       inter-american foundation

       For necessary expenses to carry out the functions of the 
     Inter-American Foundation in accordance with section 401 of 
     the Foreign Assistance Act of 1969, and to make such 
     contracts and commitments without regard to fiscal year 
     limitations, as provided by 31 U.S.C. 9014, $20,000,000.


                     african development foundation

       For necessary expenses to carry out title V of the 
     International Security and Development Cooperation Act of 
     1980, Public Law 96-533, and to make such contracts and 
     commitments without regard to fiscal year limitations as 
     provided by 31 U.S.C. 9104, $11,500,000: Provided, That funds 
     made available to grantees may be invested pending 
     expenditure for project purposes when authorized by the 
     President of the Foundation: Provided further, That interest 
     earned shall be used only for the purposes for which the 
     grant was made: Provided further, That this authority applies 
     to interest earned both

[[Page H6376]]

     prior to and following enactment of this provision: Provided 
     further, That notwithstanding section 505(a)(2) of the 
     African Development Foundation Act, in exceptional 
     circumstances the board of directors of the Foundation may 
     waive the $250,000 limitation contained in that section with 
     respect to a project: Provided further, That the Foundation 
     shall provide a report to the Committee on Appropriations 
     after each time such waiver authority is exercised.


                              peace corps

       For expenses necessary to carry out the provisions of the 
     Peace Corps Act (75 Stat. 612), $222,000,000, including the 
     purchase of not to exceed five passenger motor vehicles for 
     administrative purposes for use outside of the United States: 
     Provided, That none of the funds appropriated under this 
     heading shall be used to pay for abortions: Provided further, 
     That funds appropriated under this heading shall remain 
     available until September 30, 1999.

  Mr. MICA. Mr. Chairman, I move to strike the last word.
  Mr. Chairman, I had planned to offer an amendment in this title, and 
I am not going to do that at this time. I think I would be remiss as a 
Member of Congress and someone who has spoken out about some of the 
funding for one of the agencies funded in this appropriations measure 
if I did not personally address what I consider a program that has room 
for improvement.
  I do not mean to distract or to in any way denounce the work of this 
Committee on Appropriations subcommittee. I know they have an important 
task, and trying to come up with a foreign ops appropriations measure 
is a difficult task.
  But I had proposed to offer an amendment here and had the support of 
many colleagues to reduce AID's administrative costs by about 5 
percent, or $19 million. That is just a small, token amount, really, 
but that money would have been put in the child survival and disease 
program fund, which would establish further protection of children 
throughout the world, and eradication of diseases.
  Most people do not realize it, but 33,000 children die every day 
across the world, and an estimated 12 million children die under 5 
years of age across the world every year from various diseases.
  Mr. Chairman, I have been around the world and worked in 
international trade, and I would not be critical of AID if I had not 
seen firsthand some of the problems that we have with that agency. 
Again, I know this committee is trying to do its utmost to get this 
operation in order. But let me give the Members also my perspective as 
chairman of the Subcommittee on Civil Service of the Committee on 
Government Reform and Oversight, just an idea of how personnel in AID 
are stratified.
  If Members think we are spending all of our money and funds in 
helping children and the needy in foreign countries where there is need 
of our assistance for those individuals, just listen to this. AID 
staffing has 2,916 employees. Overseas there are 1,096. In Washington, 
D.C., or this immediate area, there are 1,717 AID employees.
  So those Members who are compassionate, those who are interested in 
trying to get our AID dollars going to where they can help the 
children, where they can help the truly needy, this budget appropriates 
again and will fund 1,717 positions just in the Washington, D.C. area 
for this agency.
  Overall, AID has almost 8,000 employees, if we count in contract and 
foreign nationals that are hired. The entire Department of Education 
only has 5,000 employees.
  Mr. Chairman, I will not get into all the issues of waste and 
mismanagement in AID, but I had met sometime ago overseas with the 
president of the U.S. Chamber of Commerce in an eastern bloc country. 
This is an American. He said Americans in AID, their AID program is the 
laughingstock of some of the eastern bloc and emerging nations, because 
the United States spends $100 to give away $1. That is my concern, that 
we put money where it can do the most good.
  When we have 33,000 children dying every day, we can choose as to how 
this money is appropriated. My amendment would not have taken a penny 
out of what we are putting into the program, but it would redirect it 
as a national policy for these funds to go into child survival programs 
that are beneficial. That was the proposal that I had.
  I will not offer it because I want the process to move forward. But 
Mr. Chairman, I ask the chairman and my colleagues and members of this 
panel to look very closely at how these funds are being spent and the 
policy that we are establishing: Does the money go where it should go? 
Do we take care of folks and children around the world that need help, 
or is it going to spend a tremendous amount of money in overhead on a 
bureaucracy in Washington, D.C.?
  The CHAIRMAN. The Clerk will read.
  The Clerk read as follows:

                          Department of State


                    international narcotics control

       For necessary expenses to carry out section 481 of the 
     Foreign Assistance Act of 1961, $230,000,000: Provided, That 
     during fiscal year 1998, the Department of State may also use 
     the authority of section 608 of the Act, without regard to 
     its restrictions, to receive non-lethal excess property from 
     an agency of the United States Government for the purpose of 
     providing it to a foreign country under chapter 8 of part I 
     of that Act subject to the regular notification procedures of 
     the Committees on Appropriations: Provided further, That none 
     of the funds made available under this heading may be 
     provided to any unit of the security forces of a foreign 
     country if the Secretary of State has credible evidence to 
     believe such unit has committed gross violations of human 
     rights unless the Secretary determines and reports to the 
     Committees on Appropriations that the government of such 
     country is taking steps to bring the responsible members of 
     the security forces unit to justice.


                             Point of Order

  Mr. BARR of Georgia. Mr. Chairman, I rise to a point of order.
  The CHAIRMAN. The gentleman will state his point of order.
  Mr. BARR of Georgia. Mr. Chairman, I make a point of order that the 
language beginning with ``provided'' on page 24, line 8, through 
``justice'' on line 16 violates clause 2(b) of rule XXI of the rules of 
the House of Representatives.
  Clause 2(b) of rule XXI states that in general, no provision changing 
existing law shall be reported in any general appropriations bill.
  Mr. Chairman, I respectfully submit that the language reported in 
this general appropriations bill changes existing law in that it 
imposes duties such as the duty to make determinations or decisions on 
the Secretary of State, and that these are new duties not required in 
existing law.
  Although the language is part of the relevant appropriations act for 
the current fiscal year, that act would not apply in the fiscal year 
covered by the pending bill, and under the precedents of this House, it 
is not considered as being ``existing law'' for the purpose of the 
relevant rule.
  The CHAIRMAN. Does any other Member wish to be heard on the point of 
order?
  Mr. CALLAHAN. Mr. Chairman, I concede the point of order.
  The CHAIRMAN. The point of order is conceded.
  That portion of the bill is stricken.
  Mr. TORRES. Mr. Chairman, I want to speak in opposition to the point 
of order raised against the important counternarcotics human rights 
provision in this bill.
  The CHAIRMAN. The Chair had ruled on the point of order since it was 
conceded by the Chairman.
  Does the gentleman wish to be heard further on the point of order?
  Mr. TORRES. Mr. Chairman, I was standing on my feet in opposition to 
the point of order.


                         Parliamentary Inquiry

  Mr. BARR of Georgia. Parliamentary inquiry, Mr. Chairman.
  The CHAIRMAN. The gentleman will state his parliamentary inquiry.
  Mr. BARR of Georgia. Mr. Chairman, is it proper to entertain further 
remarks on a point of order after the point of order has been sustained 
by the Chair?
  The CHAIRMAN. Argument on a point of order is at the discretion of 
the Chair. The Chair will entertain the comments of the gentleman from 
California [Mr. Torres] and withhold his ruling.
  The Chair recognizes the gentleman from California [Mr. Torres].
  Mr. TORRES. Mr. Chairman, the bill currently contains the so-called 
Leahy provision which was enacted last year. The Leahy amendment 
stipulates that if the Secretary of State finds credible evidence 
implicating a foreign military unit of gross human rights violations, 
and no steps have been taken to bring those responsible to justice, 
then the unit, not the whole country, would be cut off from some form 
of U.S. counternarcotics aid.

[[Page H6377]]

  I supported the effort to have this provision included in last year's 
bill. U.S. taxpayer dollars must not be spent on murderers. The 
situation today in Colombia is severe. Colombia has the worst human 
rights record in the Western Hemisphere, with an average of 10 
Colombians murdered every day for political or ideological reasons. 
Approximately 65 percent of those killings are attributed to the 
military and their paramilitary allies.
  Colombian units, military units, responsible for some of the worst 
human rights violations and atrocities in recent years were also those 
that received U.S. assistance. Joint army paramilitary operations have 
displaced thousands of civilians, mostly peasant farmers. Earlier this 
year inhabitants of more than 15 municipalities or communities in the 
municipality of Choco were forced to leave their communities by 
paramilitary groups. They were told they had 5 days, 5 days to abandon 
their homes. Otherwise, they would be killed. Several communities were 
bombed by military forces. Many people have fled to other regions, to 
neighboring Panama. There is reason to believe, and to be seriously 
concerned about the safety of the civilian population as these 
operations continue.
  Mr. Chairman, I ask my colleagues, the Leahy provisions are the very 
minimum standards we utilize before releasing $1 million of military 
aid to combat narco-trafficking. Using this procedure, making a point 
of order to strike the Leahy provision is a back-door attempt to do 
away with a critical component of counternarcotics assistance 
accountability, and we must not allow that to happen.
  Mr. BARRETT of Wisconsin. Mr. Chairman, will the gentleman yield?
  The CHAIRMAN. The Chair controls the time. The Chair has recognized 
the gentleman from California [Mr. Torres] briefly to talk on the point 
of order.
  Is the gentleman from California [Mr. Torres] finished on his 
comments?
  Mr. TORRES. I yield to the gentleman from Wisconsin.
  The CHAIRMAN. The gentleman is not able to yield.

                              {time}  2030

  Mr. BARRETT of Wisconsin. Mr. Chairman, I rise in opposition to the 
point of order.
  The CHAIRMAN. The Chair will entertain further brief comments on the 
point of order.
  Mr. BARRETT of Wisconsin. Mr. Chairman, I also rise in opposition to 
the point of order. This provision, which was first authored by Senator 
Leahy, prevents foreign security forces from using our aid to commit 
gross violations of human rights. That is the language. Gross 
violations of human rights.
  I think we would all agree, Democrats and Republicans, that our 
foreign aid should not be used by foreign security forces to kill, 
kidnap, or torture their own citizens. That is a principle which I 
would think would go unchallenged here today. The bill in its current 
form provides that no international narcotics control funds can be used 
to provide any aid to any unit of a security force of a foreign country 
if the Secretary of State has credible evidence to believe that unit 
has committed gross violations of human rights.
  It has been suggested, and wrongly so, that any nongovernmental 
organization can hamstring our international narcotics assistance by 
bringing unfounded allegations of human rights. This is simply not 
true. The Leahy provision gives the Secretary of State the right to 
determine whether an allegation of gross human rights abuses is 
credible. Even if the Secretary of State concludes that such an 
allegation is credible, she can allow assistance to flow if she 
determines that the foreign government is taking steps to bring the 
responsible members of the security forces unit to justice.
  Mr. Chairman, where is the problem? This is a carefully, narrowly 
drawn provision which gives the Secretary of State the discretion to 
assess reports of human rights abuses and to assess the efforts of 
foreign governments to control their security forces. Mr. Chairman, 
this does not provide or does not place any additional obligations on 
this use of money because this use of money or the use of Federal 
dollars is also controlled in other forms of Federal dollars.
  In other words, we have the Leahy amendment in other types of 
assistance so the same type of analysis would be put on this type of 
assistance. I find it ironic that the gentleman from Georgia who has 
raised this point of order argued in committee that this is an issue 
that we should be debating, that Congress should be acting on this 
issue. Yet when we come to the floor he wants to completely stymie 
debate. This is an issue that should be debated on this floor because 
the basic issue, the basic issue again, Mr. Chairman, is whether we 
should be giving aid to units of government that commit gross 
violations of human rights.
  Mr. FARR of California. Mr. Chairman, I rise to speak on the point of 
order.
  The CHAIRMAN. The Chair will entertain further brief comments on the 
point of order.
  Mr. FARR of California. Mr. Chairman, I concur with the gentleman 
that has just spoken. It makes no sense to give money or weapons to 
militaries without making sure that they are used for the right 
purposes. This provision just does that. It is a one sentence 
provision. It is totally permissive. It ensures that our resources are 
not misused by human rights violators.
  I rise as a former member of the U.S. Peace Corps serving in 
Colombia. I know that there are human rights violations because a lot 
of the paramilitary down there we have no jurisdiction over have been 
using the military equipment that we have sent to Colombia. We need to 
make sure that we do not throw money at the problem of drugs if it puts 
human rights and innocent people at risk because, if we do that, we do 
not stand for anything. The credibility of America is gone. The 
provision is responsible and fair and should be kept in the final bill.
  I urge the Chair to rule against the points of order because this is 
made in one sentence that is permissive and does not mandate that 
expenditure has to be done as such.
  Ms. PELOSI. Mr. Chairman, I rise to speak briefly in opposition to 
the point of order.
  The CHAIRMAN. The Chair recognizes the gentlewoman from California 
[Ms. Pelosi].
  Ms. PELOSI. Mr. Chairman, I rise in opposition to the point of order 
and would like to make two points in regard to it.
  First, it is unfortunate that this rule came to the floor this way 
not protecting this language as was requested by our committee. Let our 
membership debate this issue and vote one way or another. But to leave 
this issue exposed this way is, I think, a disservice to the Members of 
this House because the actual point of order that the gentleman makes, 
I believe, is based on a mistake, the mistaken impression that has been 
circulating here that we have been withholding funds from the Colombian 
national police. That is not true.
  We have been withholding funds from the military but the United 
States has been assisting the Colombian national police in the battle 
against narcotics. Therefore, we would welcome the debate on the 
language that is in the bill which withholds funds from the units of 
the military which have committed gross human rights violations. I wish 
that the rule would have allowed our colleagues to hear the debate. 
Vote it up or down. I urge the Chair to reject the point of order.
  The CHAIRMAN. The Chair is prepared to rule.
  The provision requires the Secretary of State to evaluate 
``credible'' evidence and to make reports not required by existing law. 
The point of order has been conceded by the gentleman from Alabama and 
the Chair sustains the point of order. The provision is in violation of 
clause 2 of rule XXI and is stricken from the bill.
  The Clerk will read:
  The Clerk read as follows:


                    MIGRATION AND REFUGEE ASSISTANCE

         For expenses, not otherwise provided for, necessary to 
     enable the Secretary of State to provide, as authorized by 
     law, a contribution to the International Committee of the Red 
     Cross, assistance to refugees, including contributions to the 
     International Organization for Migration and the United 
     Nations High Commissioner for Refugees, and other activities 
     to meet refugee and migration needs; salaries and expenses of 
     personnel and dependents as authorized by the Foreign Service 
     Act of 1980; allowances as authorized by

[[Page H6378]]

     sections 5921 through 5925 of title 5, United States Code; 
     purchase and hire of passenger motor vehicles; and services 
     as authorized by section 3109 of title 5, United States Code, 
     $650,000,000: Provided, That not more than $12,000,000 shall 
     be available for administrative expenses.


                    REFUGEE RESETTLEMENT ASSISTANCE

         For necessary expenses for the targeted assistance 
     program authorized by title IV of the Immigration and 
     Nationality Act and section 501 of the Refugee Education 
     Assistance Act of 1980 and administered by the Office of 
     Refugee Resettlement of the Department of Health and Human 
     Services, in addition to amounts otherwise available for such 
     purposes, $5,000,000.


     UNITED STATES EMERGENCY REFUGEE AND MIGRATION ASSISTANCE FUND

         For necessary expenses to carry out the provisions of 
     section 2(c) of the Migration and Refugee Assistance Act of 
     1962, as amended (22 U.S.C. 260(c)), $50,000,000, to remain 
     available until expended: Provided, That the funds made 
     available under this heading are appropriated notwithstanding 
     the provisions contained in section 2(c)(2) of the Migration 
     and Refugee Assistance Act of 1962 which would limit the 
     amount of funds which could be appropriated for this purpose.


    NONPROLIFERATION, ANTI-TERRORISM, DEMINING AND RELATED PROGRAMS

         For necessary expenses for nonproliferation, anti-
     terrorism and related programs and activities, $118,000,000, 
     to carry out the provisions of chapter 8 of part II of the 
     Foreign Assistance Act of 1961 for anti-terrorism assistance, 
     section 504 of the FREEDOM Support Act for the 
     Nonproliferation and Disarmament Fund, section 23 of the Arms 
     Export Control Act for demining activities, notwithstanding 
     any other provision of law, including activities implemented 
     through nongovernmental and international organizations, 
     section 301 of the Foreign Assistance Act of 1961 for a 
     voluntary contribution to the International Atomic Energy 
     Agency (IAEA) and a voluntary contribution to the Korean 
     Peninsula Energy Development Organization (KEDO): Provided, 
     That of this amount not to exceed $15,000,000, to remain 
     available until expended, may be made available for the 
     Nonproliferation and Disarmament Fund, notwithstanding any 
     other provision of law, to promote bilateral and multilateral 
     activities relating to nonproliferation and disarmament: 
     Provided further, That such funds may also be used for such 
     countries other than the new independent states of the former 
     Soviet Union and international organizations when it is in 
     the national security interest of the United States to do so: 
     Provided further, That such funds shall be subject to the 
     regular notification procedures of the Committees on 
     Appropriations: Provided further, That funds appropriated 
     under this heading may be made available for the 
     International Atomic Energy Agency only if the Secretary 
     of State determines (and so reports to the Congress) that 
     Israel is not being denied its right to participate in the 
     activities of that Agency: Provided further, That not to 
     exceed $25,000,000 may be made available to the Korean 
     Peninsula Energy Development Organization (KEDO) only for 
     administrative expenses and heavy fuel oil costs 
     associated with the Agreed Framework: Provided further, 
     That such funds may be obligated to KEDO only if, thirty 
     days prior to such obligation of funds, the President 
     certifies and so reports to Congress that (1)(A) the 
     parties to the Agreed Framework are taking steps to assure 
     that progress is made on the implementation of the January 
     1, 1992, Joint Declaration on the Denuclearization of the 
     Korean Peninsula and the implementation of the North-South 
     dialogue, and (B) North Korea is complying with the other 
     provisions of the Agreed Framework between North Korea and 
     the United States and with the Confidential Minute; (2) 
     North Korea is cooperating fully in the canning and safe 
     storage of all spent fuel from its graphite-moderated 
     nuclear reactors and that such canning and safe storage is 
     scheduled to be completed by the end of fiscal year 1998; 
     and (3) North Korea has not significantly diverted 
     assistance provided by the United States for purposes for 
     which it was not intended: Provided further, That the 
     President may waive the certification requirements of the 
     preceding proviso if the President determines that it is 
     vital to the national security interests of the United 
     States: Provided further, That no funds may be obligated 
     for KEDO until 30 calendar days after submission to 
     Congress of the waiver permitted under the preceding 
     proviso: Provided further, That the obligation of any 
     funds for KEDO shall be subject to the regular 
     notification procedures of the Committees on 
     Appropriations: Provided further, That the Secretary of 
     State shall submit to the appropriate congressional 
     committees an annual report (to be submitted with the 
     annual presentation for appropriations) providing a full 
     and detailed accounting of the fiscal year request for the 
     United States contribution to KEDO, the expected operating 
     budget of the Korean Peninsula Energy Development 
     Organization, to include unpaid debt, proposed annual 
     costs associated with heavy fuel oil purchases, the amount 
     of funds pledged by other donor nations and organizations 
     to support KEDO activities on a per country basis, and 
     other related activities.

                     TITLE III--MILITARY ASSISTANCE

                  Funds Appropriated to the President


             international military education and training

       For necessary expenses to carry out the provisions of 
     section 541 of the Foreign Assistance Act of 1961, 
     $50,000,000: Provided, That funds appropriated under this 
     heading for grant financed military education and training 
     for Indonesia and Guatemala may only be available for 
     expanded international military education and training: 
     Provided further, That none of the funds appropriated under 
     this heading may be made available to support grant financed 
     military education and training at the School of the Americas 
     unless (1) the Secretary of Defense certifies that the 
     instruction and training provided by the School of the 
     Americas is fully consistent with training and doctrine, 
     particularly with respect to the observance of human rights, 
     provided by the Department of Defense to United States 
     military students at Department of Defense institutions whose 
     primary purpose is to train United States military personnel, 
     (2) the Secretary of Defense certifies that the Secretary of 
     State, in consultation with the Secretary of Defense, has 
     developed and issued specific guidelines governing the 
     selection and screening of candidates for instruction at the 
     School of the Americas, and (3) the Secretary of Defense 
     submits to the Committees on Appropriations a report 
     detailing the training activities of the School of the 
     Americas and a general assessment regarding the performance 
     of its graduates during 1996.


          Sequential Votes Postponed in Committee of the Whole

  The CHAIRMAN. Pursuant to the order of the House of Thursday, July 
24, 1997, proceedings will now resume on those amendments on which 
further proceedings were postponed in the following order:
  Amendment No. 13 offered by the gentleman from California [Mr. 
Royce]; and amendment No. 36 offered by the gentleman from Texas [Mr. 
Paul].
  The Chair will reduce to 5 minutes the time for any electronic vote 
after the first vote in this series.


                 Amendment No. 13 Offered by Mr. Royce

  The CHAIRMAN. The pending business is the demand for a recorded vote 
on the amendment offered by the gentleman from California [Mr. Royce] 
on which further proceedings were postponed and on which the noes 
prevailed by voice vote.
  The Clerk will designate the amendment.
  The Clerk designated the amendment.


                             Recorded Vote

  The CHAIRMAN. A recorded vote has been demanded.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 156, 
noes 272, not voting 6, as follows:

                             [Roll No. 346]

                               AYES--156

     Andrews
     Armey
     Bachus
     Barr
     Barrett (WI)
     Bartlett
     Bass
     Blagojevich
     Bonior
     Boswell
     Burr
     Burton
     Buyer
     Campbell
     Canady
     Chabot
     Chambliss
     Chenoweth
     Coble
     Coburn
     Collins
     Condit
     Conyers
     Cook
     Costello
     Cox
     Crane
     Crapo
     Cubin
     Cunningham
     Deal
     DeFazio
     Dellums
     Diaz-Balart
     Dickey
     Doyle
     Duncan
     Ehrlich
     Ensign
     Eshoo
     Farr
     Fawell
     Foley
     Fowler
     Fox
     Franks (NJ)
     Ganske
     Gibbons
     Gillmor
     Goodlatte
     Goodling
     Goss
     Graham
     Greenwood
     Gutknecht
     Hastert
     Hayworth
     Hefley
     Hilleary
     Hobson
     Hoekstra
     Horn
     Hostettler
     Hulshof
     Hunter
     Hutchinson
     Istook
     Jackson (IL)
     Jones
     Kanjorski
     Kaptur
     Kasich
     Kingston
     Klug
     Kucinich
     Largent
     LaTourette
     Leach
     Lewis (GA)
     Linder
     Lipinski
     LoBiondo
     Luther
     Markey
     McHale
     McHugh
     McInnis
     McIntosh
     McIntyre
     McKeon
     McKinney
     Meehan
     Mica
     Miller (FL)
     Molinari
     Myrick
     Nethercutt
     Neumann
     Ney
     Norwood
     Obey
     Pallone
     Pappas
     Pascrell
     Paul
     Paxon
     Pease
     Peterson (MN)
     Petri
     Pitts
     Portman
     Poshard
     Pryce (OH)
     Radanovich
     Ramstad
     Riggs
     Rivers
     Roemer
     Rogan
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryun
     Salmon
     Sanders
     Sanford
     Scarborough
     Schaefer, Dan
     Schaffer, Bob
     Sensenbrenner
     Shadegg
     Shaw
     Shays
     Shuster
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Smith, Linda
     Solomon
     Souder
     Stearns
     Strickland
     Sununu
     Talent
     Taylor (MS)
     Thune
     Tiahrt
     Tierney
     Traficant
     Visclosky
     Wamp
     Watkins
     Watts (OK)
     Weldon (PA)
     Whitfield
     Woolsey

                               NOES--272

     Abercrombie
     Ackerman
     Aderholt
     Allen
     Archer
     Baesler
     Baker
     Baldacci
     Ballenger
     Barcia
     Barrett (NE)
     Barton
     Bateman
     Becerra
     Bentsen
     Bereuter
     Berman
     Berry
     Bilbray
     Bilirakis
     Bishop

[[Page H6379]]


     Bliley
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Borski
     Boucher
     Boyd
     Brady
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant
     Bunning
     Callahan
     Calvert
     Camp
     Cannon
     Capps
     Cardin
     Carson
     Castle
     Christensen
     Clay
     Clayton
     Clement
     Clyburn
     Combest
     Cooksey
     Coyne
     Cramer
     Cummings
     Danner
     Davis (FL)
     Davis (IL)
     Davis (VA)
     DeGette
     Delahunt
     DeLauro
     DeLay
     Deutsch
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doolittle
     Dreier
     Dunn
     Edwards
     Ehlers
     Emerson
     Engel
     English
     Etheridge
     Evans
     Everett
     Ewing
     Fattah
     Fazio
     Filner
     Flake
     Foglietta
     Ford
     Frank (MA)
     Frelinghuysen
     Frost
     Furse
     Gallegly
     Gejdenson
     Gekas
     Gephardt
     Gilchrest
     Gilman
     Goode
     Gordon
     Granger
     Green
     Gutierrez
     Hall (OH)
     Hall (TX)
     Hamilton
     Hansen
     Harman
     Hastings (FL)
     Hastings (WA)
     Hefner
     Herger
     Hill
     Hilliard
     Hinchey
     Hinojosa
     Holden
     Hooley
     Houghton
     Hoyer
     Hyde
     Inglis
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson (WI)
     Johnson, E. B.
     Johnson, Sam
     Kelly
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kilpatrick
     Kim
     Kind (WI)
     King (NY)
     Kleczka
     Klink
     Knollenberg
     Kolbe
     LaFalce
     LaHood
     Lampson
     Lantos
     Latham
     Lazio
     Levin
     Lewis (CA)
     Lewis (KY)
     Livingston
     Lofgren
     Lowey
     Lucas
     Maloney (CT)
     Maloney (NY)
     Manton
     Manzullo
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McCrery
     McDade
     McDermott
     McGovern
     McNulty
     Meek
     Menendez
     Metcalf
     Millender-McDonald
     Miller (CA)
     Minge
     Mink
     Moakley
     Mollohan
     Moran (KS)
     Moran (VA)
     Morella
     Murtha
     Nadler
     Neal
     Northup
     Nussle
     Oberstar
     Olver
     Ortiz
     Owens
     Oxley
     Packard
     Parker
     Pastor
     Payne
     Pelosi
     Peterson (PA)
     Pickering
     Pickett
     Pombo
     Pomeroy
     Porter
     Price (NC)
     Quinn
     Rahall
     Rangel
     Redmond
     Regula
     Reyes
     Riley
     Rodriguez
     Rogers
     Rothman
     Roukema
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sandlin
     Sawyer
     Saxton
     Schumer
     Scott
     Serrano
     Sessions
     Sherman
     Shimkus
     Sisisky
     Skaggs
     Skeen
     Skelton
     Slaughter
     Smith (OR)
     Smith, Adam
     Snowbarger
     Snyder
     Spence
     Spratt
     Stabenow
     Stenholm
     Stokes
     Stump
     Stupak
     Tanner
     Tauscher
     Tauzin
     Thomas
     Thompson
     Thornberry
     Thurman
     Torres
     Towns
     Turner
     Upton
     Velazquez
     Vento
     Walsh
     Waters
     Watt (NC)
     Waxman
     Weldon (FL)
     Weller
     Wexler
     Weygand
     White
     Wicker
     Wise
     Wolf
     Wynn
     Yates
     Young (FL)

                             NOT VOTING--6

     Forbes
     Gonzalez
     Schiff
     Stark
     Taylor (NC)
     Young (AK)

                              {time}  2057

  Ms. DeGETTE, Mr. DOOLITTLE, Ms. SLAUGHTER, and Messrs. CUMMINGS, 
SESSIONS and SAXTON, and Mrs. McCARTHY of New York changed their vote 
from ``aye'' to ``no.''
  Messrs. CONYERS, BUYER and GILLMOR changed their vote from ``no'' to 
``aye.''
  So the amendment was rejected.
  The result of the vote was announced as above recorded.


                  Amendment No. 36 Offered by Mr. Paul

  The CHAIRMAN. The pending business is the demand for a recorded voted 
on the amendment offered by the gentleman from Texas [Mr. Paul] on 
which further proceedings were postponed and on which the noes 
prevailed by voice vote.
  The Clerk will designate the amendment.
  The Clerk designated the amendment.


                             Recorded Vote

  The CHAIRMAN. A recorded vote has been demanded.
  A recorded vote was ordered.
  The CHAIRMAN. This is a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 40, 
noes 387, not voting 7, as follows:

                             [Roll No. 347]

                                AYES--40

     Bachus
     Barr
     Bartlett
     Burton
     Campbell
     Chabot
     Chenoweth
     Coble
     Coburn
     Crapo
     Deal
     DeLay
     Doolittle
     Duncan
     Ensign
     Hayworth
     Hilleary
     Hoekstra
     Hostettler
     Hunter
     Istook
     Markey
     McIntosh
     Paul
     Pease
     Petri
     Pombo
     Rohrabacher
     Royce
     Ryun
     Sanford
     Scarborough
     Sensenbrenner
     Shadegg
     Smith (MI)
     Smith, Linda
     Stearns
     Taylor (MS)
     Traficant
     Wamp

                               NOES--387

     Abercrombie
     Ackerman
     Aderholt
     Allen
     Andrews
     Archer
     Armey
     Baesler
     Baker
     Baldacci
     Ballenger
     Barcia
     Barrett (NE)
     Barrett (WI)
     Barton
     Bass
     Bateman
     Becerra
     Bentsen
     Bereuter
     Berman
     Berry
     Bilbray
     Bilirakis
     Bishop
     Blagojevich
     Bliley
     Blumenauer
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonior
     Bono
     Borski
     Boswell
     Boucher
     Boyd
     Brady
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant
     Bunning
     Burr
     Buyer
     Callahan
     Calvert
     Camp
     Canady
     Cannon
     Capps
     Cardin
     Carson
     Castle
     Chambliss
     Christensen
     Clay
     Clayton
     Clement
     Clyburn
     Collins
     Combest
     Condit
     Conyers
     Cook
     Cooksey
     Costello
     Cox
     Coyne
     Cramer
     Crane
     Cubin
     Cummings
     Cunningham
     Danner
     Davis (FL)
     Davis (IL)
     Davis (VA)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dellums
     Deutsch
     Diaz-Balart
     Dickey
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doyle
     Dreier
     Dunn
     Edwards
     Ehlers
     Ehrlich
     Emerson
     Engel
     English
     Eshoo
     Etheridge
     Evans
     Everett
     Ewing
     Farr
     Fattah
     Fawell
     Fazio
     Filner
     Flake
     Foglietta
     Foley
     Ford
     Fowler
     Fox
     Frank (MA)
     Franks (NJ)
     Frelinghuysen
     Frost
     Furse
     Gallegly
     Ganske
     Gejdenson
     Gekas
     Gephardt
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Granger
     Green
     Greenwood
     Gutierrez
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hamilton
     Hansen
     Harman
     Hastert
     Hastings (FL)
     Hastings (WA)
     Hefley
     Hefner
     Herger
     Hill
     Hilliard
     Hinchey
     Hinojosa
     Hobson
     Holden
     Hooley
     Horn
     Houghton
     Hoyer
     Hulshof
     Hutchinson
     Hyde
     Inglis
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson (WI)
     Johnson, E. B.
     Johnson, Sam
     Jones
     Kanjorski
     Kaptur
     Kasich
     Kelly
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kilpatrick
     Kim
     Kind (WI)
     King (NY)
     Kingston
     Kleczka
     Klink
     Klug
     Knollenberg
     Kolbe
     Kucinich
     LaFalce
     LaHood
     Lampson
     Lantos
     Largent
     Latham
     LaTourette
     Lazio
     Leach
     Levin
     Lewis (CA)
     Lewis (GA)
     Lewis (KY)
     Linder
     Lipinski
     Livingston
     LoBiondo
     Lofgren
     Lowey
     Lucas
     Luther
     Maloney (CT)
     Maloney (NY)
     Manton
     Manzullo
     Martinez
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McCrery
     McDade
     McDermott
     McGovern
     McHale
     McHugh
     McInnis
     McIntyre
     McKeon
     McKinney
     McNulty
     Meehan
     Meek
     Menendez
     Metcalf
     Mica
     Millender-McDonald
     Miller (CA)
     Miller (FL)
     Minge
     Mink
     Moakley
     Molinari
     Mollohan
     Moran (KS)
     Moran (VA)
     Morella
     Murtha
     Myrick
     Nadler
     Neal
     Nethercutt
     Neumann
     Ney
     Northup
     Norwood
     Nussle
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Oxley
     Packard
     Pallone
     Pappas
     Parker
     Pascrell
     Pastor
     Paxon
     Payne
     Pelosi
     Peterson (MN)
     Peterson (PA)
     Pickering
     Pickett
     Pitts
     Pomeroy
     Porter
     Portman
     Poshard
     Price (NC)
     Pryce (OH)
     Quinn
     Radanovich
     Rahall
     Ramstad
     Rangel
     Redmond
     Regula
     Reyes
     Riggs
     Riley
     Rivers
     Rodriguez
     Roemer
     Rogan
     Rogers
     Ros-Lehtinen
     Rothman
     Roukema
     Roybal-Allard
     Rush
     Sabo
     Salmon
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Saxton
     Schaefer, Dan
     Schaffer, Bob
     Schumer
     Scott
     Serrano
     Sessions
     Shaw
     Shays
     Sherman
     Shimkus
     Shuster
     Sisisky
     Skaggs
     Skeen
     Skelton
     Slaughter
     Smith (NJ)
     Smith (OR)
     Smith (TX)
     Smith, Adam
     Snowbarger
     Snyder
     Souder
     Spence
     Spratt
     Stabenow
     Stenholm
     Stokes
     Strickland
     Stump
     Stupak
     Sununu
     Talent
     Tanner
     Tauscher
     Tauzin
     Thomas
     Thompson
     Thornberry
     Thune
     Thurman
     Tiahrt
     Tierney
     Torres
     Towns
     Turner
     Upton
     Velazquez
     Vento
     Visclosky
     Walsh
     Waters
     Watkins
     Watt (NC)
     Watts (OK)
     Waxman
     Weldon (FL)
     Weldon (PA)
     Weller
     Wexler
     Weygand
     White
     Whitfield
     Wicker
     Wise
     Wolf
     Woolsey
     Wynn
     Yates
     Young (FL)

                             NOT VOTING--7

     Forbes
     Gonzalez
     Schiff
     Solomon
     Stark
     Taylor (NC)
     Young (AK)

                              {time}  2107

  Messrs. SANFORD, BACHUS and RYUN changed their vote from ``no'' to 
``aye.''
  So the amendment was rejected.
  The result of the vote was announced as above recorded.

[[Page H6380]]

  Mr. CALLAHAN. Mr. Chairman, I move that the Committee do now rise.
  The motion was agreed to.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Hastings of Washington) having assumed the chair, Mr. Thornberry, 
Chairman of the Committee of the Whole House on the State of the Union, 
reported that that Committee, having had under consideration the bill 
(H.R. 2159), making appropriations for foreign operations, export 
financing, and related programs for the fiscal year ending September 
30, 1998, and for other purposes, had come to no resolution thereon.

                          ____________________