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THE WHITE HOUSE WASHINGTON ACTION CONFIDENTIAL December 27, 1971 MEMORANDUM FOR: THE PRESIDENT THE PRESIDENT HAS SEEN FROM: PETER G. PETERSON SUBJECT: Bermuda, Generalized Preferences, and 1972 Trade/Political Strategy The announcement in Bermuda that we will submit generalized preferences trade legislation raises questions of implementation, particularly timing, While we have previously discussed these questions, it is useful to review them inmlight of your recent initiatives. The Ways and Means Committee is clearly protectionist in its orientation and one of the sponsors of the Labor bill along with Hartke is Committee member Congressman Burke. In past conversations, Wilbur Mills has told me it might be very difficult to insulate the generalized preferences legislation from a Christmas Tree approach; in this case the Hartke-Burke bill. Thus, if we submit only generalized preferences and/or do it at the wrong time, we could end up opening a political Pandora's box without a positive alternative of our own to the Hartke-Burke bill. Where do we stand on our own program? We have several Council on International Economic Policy Task Forces well into the work on a comprehensive legislative package (export promotion, adjustment assistance, investment policies, East-West trade, Presidential negotiating authority, etc.) ), but it would take a crash effort to get a final legislative package ready for March or April submission. Aside from political and policy side effects, there is the important question of our own domestic priorities - since the Ways and Means Committee also would be handling revenue sharing, health, welfare reform, pension legislation, environmental and R&D tax credits, and perhaps even broader tax legislation. There are many options, and all of us who have worked on this, including MacGregor, Shultz, and Ehrlichman, agree that timing of trade legislation is both a very tough and a very political decision, particularly in an election year. The session you have already approved would be in San Clemente in early January, which is the earliest time John Connally could conveniently be there; given the high political content, the legislative strategies, as well as the subject area, George Shultz and I feel it would be inappropriate to have a meeting without Connally. Also, Rogers and Kissinger would of course be there. DECLASSIFIED E.O. 12958, Sect. 3.6 By GRG NARA, Date 12/16/97