[Congressional Record Volume 144, Number 97 (Monday, July 20, 1998)]
[House]
[Pages H5883-H5887]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




       RELATING TO THE IMPORTANCE OF JAPANESE AMERICAN RELATIONS

  Mr. BEREUTER. Mr. Speaker, I move to suspend the rules and agree to 
the resolution (H. Res. 392) relating to the importance of Japanese-
American relations and the urgent need for Japan to more effectively 
address its economic and financial problems and open its markets by 
eliminating informal barriers to trade and investment, thereby making a 
more effective contribution to leading the Asian region out of its 
current financial crisis, insuring against a global recession, and 
reinforcing regional stability and security, as amended.
  The Clerk read as follows:

                              H. Res. 392

       Whereas the maintenance and improvement of a very positive 
     international relationship between the United States and 
     Japan is vital to the two countries and to the entire global 
     economic and trading system;
       Whereas the United States-Japan Security Alliance and close 
     economic cooperation have underpinned the security, 
     stability, and prosperity of the Asia-Pacific region, thereby 
     allowing that region to enjoy unmatched economic growth and 
     development for nearly three decades;
       Whereas the current financial crisis in Asia threatens the 
     foundation of Asia's unmatched peace and prosperity, the 
     stability of the global economic system, and related vital 
     American security and economic interests;
       Whereas, although the Government of Japan's 
     $128,000,000,000 economic stimulus and tax reduction package 
     of April 24, 1998, includes numerous provisions designed to 
     promote consumer spending and industrial growth, it is by no 
     means clear that these measures will restore economic growth 
     or will be targeted at the most productive sectors of the 
     economy;
       Whereas Japan's generous contributions to second line 
     credits for the three International Monetary Fund program 
     countries, South Korea, Thailand, and Indonesia, totaling 
     $19,000,000,000, and its substantial structural adjustment 
     loans and export credits to Indonesia, have helped contain 
     the financial crisis, but are an inadequate alternative to a 
     strong Japanese economy;
       Whereas Japan accounts for three-fourths of the total East 
     Asian Gross Domestic Product and therefore has the potential 
     to help pull the region out of the financial crisis by 
     serving as its ``engine of growth'', just as the United 
     States, by being an ``engine of growth'' and having open 
     markets, earlier assisted Mexico emerge from a substantial 
     financial crisis;
       Whereas a further weakening of the yen could trigger a 
     round of competitive devaluations among Japan's Asian 
     neighbors;
       Whereas deteriorating economic conditions and ongoing 
     financial market turbulence in Asia make it increasingly 
     important that Japan play a leadership role in helping to 
     restore confidence in the economic future of the region;
       Whereas that regional leadership role coincides with 
     Japan's stated goal of promoting strong domestic demand-led 
     growth and avoiding a significant increase in its external 
     trade surplus;
       Whereas Japan's continued economic stagnation depresses the 
     level of its imports from the United States and other 
     countries in the Asia-Pacific region, thereby forcing its 
     neighbors in the region to rely more heavily on their exports 
     to the United States for growth;
       Whereas weakened economic fundamentals in Japan and an 
     accommodative monetary policy, coupled with a robust United 
     States economy, have weakened the value of the Japanese yen 
     against the United States dollar and therefore stimulated a 
     rapid expansion of exports and a fast-growing merchandise 
     trade surplus with the United States, which increased from 
     $48,000,000,000 in 1996 to $55,000,000,000 in 1997;
       Whereas the bursting of Japan's investment bubble in 1991 
     has been accompanied by protracted asset-price and balance 
     sheet adjustments by Japanese financial institutions, leading 
     to a scarcity of credit and weak growth;
       Whereas policies favoring low interest rates had 
     encouraged, until recently, excessive private sector lending 
     to overly indebted enterprises in Indonesia, Korea, and 
     Thailand, and thereby contributed to the private debt crisis 
     in the region;
       Whereas past efforts to stimulate recovery through deficit 
     spending targeted at the construction sector have proved 
     inadequate and failed to accomplish their desired objectives;
       Whereas inadequate deregulation initiatives have failed to 
     restore vitality to the Japanese economy, while truly 
     significant deregulation could add as much as a percentage 
     point or more to Japanese economic growth; and
       Whereas the continued failure of the Government of Japan to 
     properly recognize and remedy the aforementioned policies 
     will both prolong the Asian financial crisis and contribute 
     to the inevitable rise in the American trade deficit with 
     Japan, thereby potentially undermining American domestic 
     support for close economic, political, and security 
     cooperation and coordination between the United States and 
     Japan at a critical point in history: Now, therefore, be it
       Resolved, That it is the sense of the House of 
     Representatives that Japan should urgently undertake the 
     following steps to enhance alliance cooperation and raise 
     Japan to the position of regional partnership that it should 
     enjoy by virtue of its economic size, technological 
     achievements and its democratic political system:
       (1) Undertake a broader and faster deregulation of its 
     economy, in order to improve long-term growth prospects and 
     promote opportunities for foreign firms, improve transparency 
     and disclosure, reward innovation and competition, and reduce 
     systemic risk.
       (2) Further open its distribution system to eliminate 
     exclusionary and discriminatory business practices that are 
     not only limiting imports

[[Page H5884]]

     but stifling economic growth and competition in Japan.
       (3) Fully honor and implement its bilateral trade 
     agreements with the United States as well as its multilateral 
     trade commitments.
       (4) Take other aggressive steps to reduce numerous barriers 
     to imports and foreign investment and seek to lower its 
     current account surplus to 2 percent or less of gross 
     domestic product.
       (5) Move promptly to dispose of nonperforming bank loans by 
     disposing of nonperforming real estate and other loans and by 
     allowing the market to determine the real value of these 
     assets and loans.
       (6) Take immediate steps to address systemic problems in 
     the banking system, close insolvent banks, and recapitalize 
     weaker banks with banks that have strong fundamentals and 
     good management.
       (7) Address its fiscal problems in a manner that does not 
     jeopardize economic recovery, with an emphasis on significant 
     and meaningful tax cuts and a comprehensive stimulus package 
     that restores economic confidence and avoids the traditional 
     sectorally-oriented approach of the past.
       (8) Adopt all appropriate policies to strengthen the 
     Japanese yen.

  The SPEAKER pro tempore (Mr. Stearns). Pursuant to the rule, the 
gentleman from Nebraska (Mr. Bereuter) and the gentleman from Indiana 
(Mr. Hamilton) each will control 20 minutes.
  The Chair recognizes the gentleman from Nebraska (Mr. Bereuter).


                             General Leave

  Mr. BEREUTER. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days within which to revise and extend their 
remarks on H. Res. 392.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Nebraska?
  There was no objection.
  Mr. BEREUTER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the people of Japan have spoken to their government 
officials about the need for economic reform. It is now more important 
than ever that the House of Representatives send a clear and 
unequivocal message seconding that call for reform by unanimously 
approving House Resolution 392.
  The House resolution emphasizes the importance of U.S.-Japan 
relations and stresses the urgent need for Japan to more effectively 
address its economic and financial problems and open its markets by 
eliminating informal barriers to trade and investment.
  This Member introduced the resolution on March 24, 1998. The House 
Committee on International Relations adopted it by voice vote on June 
5. This resolution's arrival on the floor is particularly timely, I 
would think, for, as Clyde Prestowitz said in his July 17, 1998, 
opinion piece in the Washington Post, ``It is important that the United 
States and other countries move quickly to reinforce and elaborate the 
message of the Japanese electorate.'' That message, of course, was a 
demand for change in light of the continuing Asian economic crisis.
  The Asian financial crisis represents a serious threat to the 
economic growth of the United States and the global economy. 
Approximately one year ago, Thailand's financial crisis was described 
by the President of the United States and many other experts as a few 
small glitches in the road. Now, one year later, Japan and Hong Kong 
are in recession, Indonesia's 32-year leader Suharto is gone, Russia 
stands in desperate need of more international assistance, and the 
world is pleading with China not to devalue its currency.
  Despite Federal Reserve Chairman Greenspan's intentional down playing 
of the crisis so as not to disrupt the markets further, the Asian 
financial crisis threat is real, significant, and unfortunately not a 
short-term problem. This resolution states that Japan plays a crucial 
stabilizing role in the Asian-Pacific region and, therefore, must make 
a more effective contribution to leading the Asian-Pacific region out 
of its current financial crisis, insuring against global recession and 
reinforcing regional stability and security.
  This resolution notes that Japan has generously responded to the 
Asian financial crisis by providing $19 billion in second-line credit 
to the Republic of Korea, Thailand, and Indonesia. Nevertheless, it 
also urges Japan to be more directly involved in helping the ailing 
Asian economies by opening its markets, deregulating its economy, 
eliminating barriers to trade, fixing its financial sector, adopting 
permanent tax cuts, and strengthening the yen.
  Japan is the world's second largest economy and accounts for an 
amazing three-fourths of the total East-Asian gross domestic product. 
It certainly has the potential to play a leading role in pulling the 
region out of the financial crisis by serving as its engine of growth, 
or at least a second engine of growth along with the United States.
  The United States' response to the Mexican crisis is a good example 
of how Japan could jointly serve with the United States and Europe as 
the engines of growth for Korea, Thailand, Indonesia and the region. 
The regional leadership role that this resolution calls on Japan to 
accept is entirely consistent with Japan's stated goal of promoting 
strong domestic demand-led growth and avoiding a significant increase 
in external surplus. Yet, Japan is in a full-blown recession, 7 years 
of stalemate, with zero growth projected for 1998, followed by as much 
as a 2 percent contraction in 1999.
  Already, Japan's imports from most of its Asian trading partners have 
dropped substantially in the first quarter of 1998. For example, 
compared to the same period in 1997, Japan's first-quarter imports from 
Indonesia declined 46.5 percent, Japan's imports from Thailand declined 
39.7 7 percent, and its imports from South Korea declined 38.5 percent.
  These weak economic fundamentals for Japan, coupled with a robust 
United States economy, have already weakened the value of the Japanese 
yen vis-a-vis the dollar. The weak yen has, in turn, stimulated a rapid 
expansion of exports and a fast-growing merchandise trade surplus with 
the United States, which increased from $48 billion in 1996 to $55 
billion in 1997 and is on a record surplus pace in 1998.
  Although the United States was able to almost unilaterally absorb 
Mexico's imports after the peso crisis, the United States simply cannot 
economically or politically absorb all the additional imports from the 
Asian-Pacific region stemming from the financial crisis. Mostly because 
of the Asian financial crisis, the IMF estimates that the U.S. trade 
deficit with the world, already at $178 billion in 1997, could grow as 
much as an incredible $50 to $100 billion in 1998. And that is the 
growth, $50 to $100 billion.
  U.S. officials representing both Republican and Democrat 
administrations have long called for Japan to deregulate its economy 
and remove informal barriers to trade. More recently, U.S. Treasury and 
Federal Reserve officials have called upon Japan to take the tough 
steps necessary to reform the financial sector of the economy. 
Nevertheless, knowledgeable Japan observers have been underwhelmed by 
the scale and scope of the proposed reforms in Japan, including the 
financial sector big bang and a bridge bank to close bankrupt financial 
institutions. To paraphrase Secretary Rubin, it is time for Japan to 
move beyond virtual reform to real reform.
  Moreover, Japan's political leaders have stubbornly refused to 
abandon their export-dominated economic model while undermining Korea, 
Thailand and Indonesia's recovery from the Asian financial crisis. For 
example, Japan's current account surplus with the world has risen from 
$65.8 billion in 1995 to $93.5 billion in 1997, and is expected to 
exceed $100 billion in 1998.
  This resolution reinforces the administration's strategy to focus on 
key deregulation and competition policy initiatives in Japan. For 
example, it urges Japan to undertake a broader and faster deregulation 
of its economy, open its distribution system, and eliminate 
exclusionary and discriminatory business practices. These initiatives 
are aimed at helping highly competitive U.S. companies in sectors such 
as financial services, telecommunications, pharmaceuticals, 
construction materials, and consumer goods gain access to the Japanese 
consumer.
  Furthermore, this resolution calls upon Japan to take other steps to 
reduce numerous non-tariff barriers to imports and foreign investment. 
It also addresses reform of the financial sector in Japan by calling 
upon that country to promptly dispose of non-performing bank loans 
while taking other necessary steps to reform the banking system.
  Long before Prime Minister Hashimoto's very public wavering on tax 
cuts for Japanese, this resolution

[[Page H5885]]

stressed the need for Japanese officials to enact permanent tax cuts 
for individual Japanese citizens.
  Finally, this resolution properly, I think, recognizes that Japan 
must immediately adopt all appropriate policies to strengthen the yen. 
An excessively weak yen threatens not only the entire Asian-Pacific 
region but also global trade and stability.
  Mr. Speaker, the world is closely watching Japan to determine if that 
country's leaders can steer the world's second largest economy out of 
recession. The implications of their actions or inactions are enormous 
for Japan itself, for the regional and global economy, and for the 
United States. If Japan's newly elected leaders and a prime minister 
yet to be elected choose the right path, they can help ensure that the 
Asian financial crisis is a temporary setback on the road to further 
economic liberalization and democratization in Asia. But if they choose 
the wrong path, they have the potential to prolong the crisis and 
perhaps even contribute to a global economic slowdown that will have a 
significant impact on the United States and a very negative one.
  Mr. Speaker, I urge my colleagues to support the resolution.
  Mr. Speaker, I reserve the balance of my time.
  Mr. HAMILTON. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of H. Res. 392. I commend the 
gentleman from Nebraska (Mr. Bereuter) and the gentleman from 
California (Mr. Berman), the ranking member of the Subcommittee on Asia 
and the Pacific, for introducing this resolution. It is a very good 
one. It is carefully drafted. It is balanced, and it certainly is 
timely.
  No country can do more than Japan to help Asia's crisis economies 
recover. Consistent with its role in the region as the dominant 
economy, Japan has pledged more than any other country to the 
multilateral financial packages system for Thailand, Korea, and 
Indonesia. I would hope that the Japanese government and the people of 
Japan will note that H. Res. 392 applauds these generous contributions 
and recognizes the positive economic steps that Japan has undertaken.
  The resolution also strongly reaffirms the importance of the U.S.-
Japanese relationship. Over the long run, however, export growth and 
new private investment will be more critical than multilateral aid to 
economic recovery in Asia. As long as its economy remains stagnant and 
its financial institutions remain in crisis, Japan cannot be the 
customer and the investor that Thailand, Korea, and Indonesia need. The 
United States then will become the region's importer of last resort.
  H. Res. 392 calls for Japan to implement policies that will get its 
economy humming and put its financial system in order. These policy 
recommendations closely parallel the ones conveyed by the 
administration recently and repeatedly, and many prominent Japanese 
have urged their government to take these same steps.
  As the recent elections in Japan demonstrate, Japanese citizens also 
see the urgency of reforms.

                              {time}  1545

  We support Japan's efforts to make these important reforms. I think 
this is a responsible resolution, it conveys an important message, and 
I urge its adoption.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BEREUTER. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Arizona (Mr. Kolbe).
  (Mr. KOLBE asked and was given permission to revise and extend his 
remarks.)
  Mr. KOLBE. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, I rise in support of this resolution and commend the 
gentleman from Nebraska for drafting it. For too long we in the United 
States have misjudged, the U.S.-Japan relationship. In fact, I think 
Japan has misjudged the relationship as well. I remember just a few 
years ago, as I think many in this body remember, U.S.-Japan relations, 
particularly our trade relations, were very much at the forefront of 
American political thinking. One could not turn on a television, could 
not open a newspaper, could not buy a magazine or look at what was the 
latest on the New York Times best seller list without reading about the 
coming Japanese century or how America was losing its trade war with 
Japan. The Japanese economy was the envy of Asia, emulated by its 
neighbors and held up as a model for economic growth in the 21st 
century. At that time the Japanese economy was seen as a danger to our 
own economic prosperity.
  How quaint that picture seems today. How almost we wished that that 
were the case again today. But today it is a vastly different picture. 
Today we find a Japan that seems to be mired in perpetual economic 
stagnation. Year after year of a no-growth economy is beginning to take 
its toll as unemployment continues to rise and credit becomes more 
difficult to attain. Underlying it all is a massive public debt, 
estimated by some to be as much as 250 percent of the gross domestic 
product; over $600 billion in nonperforming bank loans; corporate 
liabilities exceeding equity by an average of four to one; and an 
overvalued property market. Yet most Japanese seem unable or unwilling 
to acknowledge the extent of the economic crisis or the impact it is 
having on the rest of us in this globe that we all occupy.
  If you walk down the streets of Tokyo today, you do not find a 
populace in fear for the future. Stores are filled with the latest 
merchandise, public works projects continue and virtually everywhere 
you look are the signs of a prosperous and successful society. There 
seems to be little concern for the future, or perhaps an unwillingness 
to admit it. There seems to be a quiet contentment with the prospects 
of subpar economic growth into the near future. This, Mr. Speaker, is 
not and must not be acceptable to the rest of the world, for our 
futures depend on the Japanese ability to solve their economic 
problems.
  It is time for Japan to recognize its pivotal role in Asia. Japan 
must confront honestly its own domestic economic problems and assume 
its proper leadership role in southeast Asia and the rest of Asia. 
Japan can help pull Asia out of its economic doldrums and help to serve 
as one of the world's leading engines of economic growth. But it can do 
so only if the Japanese government and people have the political 
courage to do that.
  This resolution that my colleague has drafted calls upon Japan to 
continue deregulation of its economy, to open its market to foreign 
goods as well as adopt policies to strengthen the yen. I fully support 
these efforts and hope my colleagues will support this important 
resolution.
  Mr. HAMILTON. Mr. Speaker, I yield 4 minutes to the distinguished 
gentleman from Michigan (Mr. Levin), a member of the Committee on Ways 
and Means.
  (Mr. LEVIN asked and was given permission to revise and extend his 
remarks.)
  Mr. LEVIN. Mr. Speaker, I thank the distinguished gentleman for 
yielding me this time. I am pleased to join my other colleagues here in 
support of this resolution.
  Several months ago, this resolution and one by the gentleman from New 
York (Mr. Houghton) and myself were introduced in this body. That was 
before the crisis in Japan reached its present peak and before its 
recent election. It may well have been that several decades ago Japan 
may have benefited from its economic policies, its closed, sheltered, 
highly regulated economy. But increasingly Japan has been paying a 
heavy price: Its consumers because they were paying prices too high; 
the subduing of competition, the evolution of Japan in a highly 
structured way that made it hard for outsiders to enter. Increasingly, 
also, there was tension that rose and rose between Japan and other 
countries.
  For over 10 years, a number of us have been urging Japan to open up 
their economic system. We talked about a number of their sectors where 
there was almost an iron curtain, an iron economic curtain, flat glass, 
autos and auto parts, film, paper and forest products, 
telecommunications, insurance, medical equipment and others. Those 
efforts were often simply given a cold shoulder by the Japanese and 
often were controversial within this Chamber. But time I think has 
shown how vital it was for Japan years ago to shift gears from its 
closed economic system, its system that essentially was

[[Page H5886]]

structured like cartels and to move to open markets.
  This is really the time for it to deregulate, to open up. The yen is 
so weak they do not have to fear a flood of imports from other 
countries. This is the time for Japan to act. It is not only a matter 
for the Japanese but for all of Asia and for this country. Secretary 
Rubin and Larry Summers and others representing the administration have 
worked diligently, as has our U.S. Trade Representative, trying to 
impress upon the Japanese that this is the time for courage, for 
boldness, for action, for the political system of that country to rise 
to the occasion.
  There is a crisis, an economic crisis in Asia today that in some 
respects is toned down but is in danger of flaming up again if Japan 
does not act. As a key Asian nation, Japan really must not only look to 
others but mainly to look to itself and to act. This resolution as the 
other one I mentioned urges the Japanese to rise to this occasion. Much 
of the world as well as their own economy will be affected. I rise in 
support and hope that this time, unlike many other previous occasions, 
that words from this Congress will be heard in Japan.
  Mr. HAMILTON. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  Mr. BEREUTER. Mr. Speaker, I yield myself such time as I may consume 
in closing.
  Mr. Speaker, I want to thank, first of all, the distinguished ranking 
member of the International Relations Committee, the gentleman from 
Indiana (Mr Hamilton) for his excellent remarks, for his support, and 
also the distinguished gentleman from Michigan, member of the Committee 
on Ways and Means, for his insightful and very welcomed remarks.
  I would like to give just a couple of examples, in closing, about the 
difficulties we face in market access today in Japan. We heard a lot 
about the American flat glass industry some time ago. In fact, in 1996, 
the USTR deputy, Ira Shapiro, testified before the Ways and Means trade 
subcommittee that United States flat glass exports to Japan had 
increased 93 percent as a result of USTR's negotiated glass agreement 
with that country. That is true, but it most certainly does not tell 
the whole story. That 93 percent increase now gives us a total market 
share of 1 percent in Japan, a whopping 1 percent of the Japanese 
market.
  Over in the area of financial services, specifically in the insurance 
sector, Japanese companies control 98 percent of the life business in 
Japan and 97 percent of the non-life business in the primary insurance 
sector. USTR recently concluded that Japan has not implemented the 
deregulation provisions of the bilateral insurance agreement and has 
taken actions to undermine, in fact, the U.S. market share in the third 
sector.
  Finally, I would mention that since 1991, seven out of 10 new 
medicines launched in Europe and the United States remain unavailable 
in Japan. So we have major problems in pharmaceutical market access in 
that country.
  These are examples of just one of the things that we are urging the 
Japanese to do, and, that is, to open up their markets, remove 
nontariff barriers and give access to their consumers to American 
products and to products from throughout the world.
  Mr. Speaker, the chairman of the House International Relations 
Committee, the distinguished gentleman from New York (Mr. Gilman), is 
involved in a traffic delay at this point. He is supportive of the 
resolution. He wanted to have that support expressed. His entire 
statement will be made a part of the record as a part of the request of 
general leave.
  Mr. Speaker, I thank my colleagues for their support. I urge 
unanimous support for the resolution to recognize that Japan is a very 
important economic player in the world, the second largest economy, to 
recognize the positive steps they have taken but to also suggest very 
substantial directions that they need to take in order to make sure 
that the Asian financial crisis does not worsen.
  Mr. GILMAN. Mr. Speaker, I rise in strong support of House Resolution 
392 urging Japan to more effectively address its financial and economic 
problems. I would like to compliment my colleague, the gentleman from 
Nebraska, Mr. Bereuter, who serves as Chairman of the Asia and Pacific 
Subcommittee, for his leadership in sponsoring this resolution and in 
bringing it to the floor today.
  As we begin to debate the status of our trading relationship with 
China and the impact of the President's recent trip to that country, we 
should not lose sight of the importance of the United States-Japan 
Security Alliance and its key role in underpinning the security and 
stability of the Asia Pacific region.
  Especially in light of the Asian financial crisis, which is slowing 
our economic growth and increasing our trade deficit to record levels, 
we must ensure that our two countries work together to reduce market 
barriers, to resolve mounting financial and bad loan problems and to 
increase trade and investment throughout Asia.
  Considered by the Asia and Pacific Subcommittee on May 14, and the 
full International Relations Committee on June 5, this resolution can 
serve as a policy blueprint and a road map to better relations when a 
new Japanese Prime Minister takes office in the very near future.
  Acknowledging the key role Japan has played in extending $19 billion 
in the form of second line credits to South Korea, Indonesia and 
Thailand, it asks Japan to more directly help the ailing Asian 
economies by stimulating its economic growth, reforming its financial 
sector and taking other similar measures to strengthen the yen.
  With United States exports to Japan down some 11 percent in the first 
5 months of this year and with the overall trade deficit expected to 
top $200 billion for the year, there are mounting concerns that 
declining wholesale prices indicate that Japan is in the grip of a 
growing deflationary spiral.
  With Japan's overall bad debt burden now estimated at $250 billion, 
it is vitally important that the newly established Financial 
Supervisory Agency take swift and decisive measures to close insolvent 
institutions and restore confidence in its ailing financial sector.
  Accordingly, I look forward to working with my colleagues on the 
committee, other interested members, and Administration officials in 
ensuring that the United States and Japan treat our economic 
relations--and our overall relationship--with the priority they 
deserve.
   Ms. JACKSON-LEE of Texas. Mr. Speaker, I strongly support this 
measure. We should encourage the continued viability of the Japanese 
economy not only because Japan represents one of America's economic 
allies but also because the detrimental impacts of the Japanese 
economic crisis directly affects both the American and global markets.
  The current crisis occurring in Japan is both real and severe. In its 
June 1998 monthly report, Bank of Japan noted that Japan's economic 
conditions continue to decline. Production continues to deteriorate. 
This problem exacerbates the employment and income crisis currently 
existing. The report also stated that public-sector investment has 
bottomed out while growth in net exports has peaked as exports to other 
Asia countries declined. Private consumption likely will not recover in 
the near future and housing investment continued to decrease.
  It is imperative that we strongly urge Japan to resolve its current 
crisis. By advising Japan to undertake a broader and faster 
deregulation of its economy, Japan could regain economic stability and 
would promote long-term growth and foreign investment. Japan must also 
eliminate its exclusionary, and sometimes discriminatory, business 
practices, as well as its numerous barriers to imports and foreign 
investment, to foster global trade and domestic, economic growth.
  Moreover, Japan must restructure its banking system by instituting 
changes such as the closing of insolvent banks and the recapitalization 
of banks. Disposal of nonperforming bank loans is equally important to 
Japanese recovery.
  We must recognize the strong ties that bind American and Japanese 
economies and how this relationship affects the global market as a 
whole. The status quo cannot continue, and without drastic changes to 
its economic approaches, Japan will no longer participate as a valued 
actor in international trade. All of the measure's recommendations, as 
well as the others proposed by this legislation, are needed to return 
Japan to financial stability.
  Mr. BEREUTER. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Kolbe). The question is on the motion 
offered by the gentleman from Nebraska (Mr. Bereuter) that the House 
suspend the rules and agree to the resolution, House Resolution 392, as 
amended.

[[Page H5887]]

  The question was taken.
  Mr. BEREUTER. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 5 of rule I and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

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