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JGR/Cabinet Council on Commerce and Trade (2 of 2)
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JGR/Cabinet Council on Commerce and Trade (2 of 2)
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John Roberts' Subject Files
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Ronald Reagan Presidential Library
Digital Library Collections
This is a PDF of a folder from our textual collections.
Collection: Roberts, John G.: Files
Folder Title: JGR/Cabinet Council on Commerce
and Trade (2 of 2)
Box: 6
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CCCT
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
February 17, 1983
MEMORANDUM FOR FRED F. FIELDING
FROM:
JOHN G. ROBERTS
osk
SUBJECT:
Proposed Reorganization
of Trade Policy Process
Craig Fuller is considering options for a possible reorganiza-
tion of the President's trade policy process. He has
inquired if the Cabinet Council on Commerce and Trade (CCCT)
could meet the requirements of 19 U.S.C. § 1872. That
section requires the President to establish an interagency
organization composed of the United States Trade Representa-
tive (USTR) and the heads of other departments designated by
the President. The duties of this organization include:
O assisting the President in carrying out 19 U.S.C.
§§ 2251, 2252, and 2253 (International Trade
Commission investigations and subsequent Presiden-
tial action);
O making recommendations to the President on basic
trade policy issues;
O advising the President with respect to the results
of 19 U.S.C. § 2412 (b) (2) hearings on petitions for
Presidential action to enforce a trade agreement;
O other functions with respect to the trade agreements
program as the President may designate.
The responsibilities of this statutorily mandated inter-
agency organization have traditionally been discharged by
the Trade Policy Committee, pursuant to Executive Order No.
11846, as amended.
The CCCT as presently formed cannot assume the responsibil-
ities of the interagency organization mandated by 19 U.S.C.
§ 1872. A separate provision, 19 U.S.C. § 2171 (c) (1) (E),
specifies that the USTR shall "be chairman of the inter-
agency trade organization established pursuant to [19 U.S.C.
§ 1872]. " The Secretary of Commerce, however, chairs the
CCCT. The legislative history of 19 U.S.C. § 1872 indicates
-2-
that the specification that the USTR chair the statutorily
mandated interagency trade organization is not a mere
technicality. As it passed the House, what is now 19 U.S.C.
$ 1872 provided that the President may designate the chair-
man. The Senate altered this to provide that the Special
Trade Representative, predecessor to the USTR, serve as
chairman because it "felt that the Chairman, if he was
chosen from one of the departments, would represent more the
views of that department than the overall broader perspec-
tive represented by the Special Representative." S. Rep.
No. 2059 (Sept. 14, 1962).
I have drafted a memorandum for your signature to Fuller
indicating that the CCCT as presently constituted cannot
meet the requirements of 19 U.S.C. $ 1872, due to the
requirements of 19 U.S.C. $ 2171 (c) (1) (E).
Attachment
THE WHITE HOUSE
WASHINGTON
February 17, 1983
MEMORANDUM FOR CRAIG L. FULLER
ASSISTANT TO THE PRESIDENT
Orig. signed by FFF
FROM:
FRED F. FIELDING
COUNSEL TO THE PRESIDENT
SUBJECT:
Trade Policy Process
By memorandum dated February 10 you inquired whether the
Cabinet Council on Commerce and Trade could satisfy the
legislative requirement that the President establish an
interagency organization to advise and assist him on trade
policy issues. 19 U.S.C. § 1872. You noted that the Trade
Policy Committee has traditionally fulfilled this legisla-
tive mandate.
The statutory provisions establishing the Office of the
United States Trade Representative specify that the USTR
shall "be chairman of the interagency trade organization
established pursuant to [19 U.S.C. § 1872]." 19 U.S.C.
§ 2171 (c) (1) (E). Since the Secretary of Commerce chairs the
Cabinet Council on Commerce and Trade, any effort to satisfy
the requirements of 19 U.S.C. § 1872 through the Cabinet
Council would conflict with 19 U.S.C. § 2171 (c) (1) (E). Our
research indicates that when it mandated an interagency
trade organization pursuant to 19 U.S.C. $ 1872, Congress
specified that the chairman be the Special Trade Representa-
tive, predecessor to the USTR, because it thought a chairman
from one of the departments would not have as broad a
perspective on the trade issues. This specification has
been carried forward as 19 U.S.C. § 2171 (c) (1) (E).
Accordingly, the Cabinet Council on Commerce and Trade as
presently constituted cannot be considered the organization
mandated by 19 U.S.C. § 1872, since that organization must
be chaired by the USTR.
FFF:JGR:aw 2/17/83
CC: FFFielding
GRoberts
Subj.
Chron
THE WHITE HOUSE
WASHINGTON
February 17, 1983
MEMORANDUM FOR CRAIG L. FULLER
ASSISTANT TO THE PRESIDENT
FROM:
FRED F. FIELDING
COUNSEL TO THE PRESIDENT
SUBJECT:
Trade Policy Process
By memorandum dated February 10 you inquired whether the
Cabinet Council on Commerce and Trade could satisfy the
legislative requirement that the President establish an
interagency organization to advise and assist him on trade
policy issues. 19 U.S.C. § 1872. You noted that the Trade
Policy Committee has traditionally fulfilled this legisla-
tive mandate.
The statutory provisions establishing the Office of the
United States Trade Representative specify that the USTR
shall "be chairman of the interagency trade organization
established pursuant to [19 U.S.C. $ 1872]. 19 U.S.C.
§ 2171 (c) (1) (E). Since the Secretary of Commerce chairs the
Cabinet Council on Commerce and Trade, any effort to satisfy
the requirements of 19 U.S.C. $ 1872 through the Cabinet
Council would conflict with 19 U.S.C. § 2171 (c) (1) (E). Our
research indicates that when it mandated an interagency
trade organization pursuant to 19 U.S.C. § 1872, Congress
specified that the chairman be the Special Trade Representa-
tive, predecessor to the USTR, because it thought a chairman
from one of the departments would not have as broad a
perspective on the trade issues. This specification has
been carried forward as 19 U.S.C. § 2171 (c) (1) (E).
Accordingly, the Cabinet Council on Commerce and Trade as
presently constituted cannot be considered the organization
mandated by 19 U.S.C. § 1872, since that organization must
be chaired by the USTR.
FFF:JGR:aw 2/17/83
CC: FFFielding
JGRoberts
Subj.
Chron
Ch. 7
Ch. 7
TRADE AGREEMENTS
19 § 1872
Texas Am. Asphalt
D.C.Tex.1959, 177 F.
PART V-ADMINISTRATIVE PROVISIONS
§ 1871. Repealed. Pub.L. 93-618, Title VI, § 602(d), Jan.
Oil Import Appeals
crude oil importation
3, 1975, 88 Stat. 2072
subsidiary
was
not
en-
mport
regulation
was
Historical Note
hardship or special
hich denial of import
Section, Pub.L 87-794. Title II, § 241, sentative for Trade Negotiations. See
overturned was not
Oct. 11, 1962, 76 Stat. 878, provided for section 2171 of this title.
or
an
abuse
of
dis-
the appointment of the Special Repre-
Co. V. Russell, 1970,
App.D.C.
180.
§ 1872. Interagency trade organization
sident's judgment that
Establishment: composition; meetings; participation by other agencies
application
of
his
to restrict oil imports
(a) The President shall establish an interagency organization to
judicial review. Tex-
assist him in carrying out the functions vested in him by this sub-
V.
Walker,
D.C.
315.
chapter and sections 2251, 2252, and 2253 of this title. Such organi-
terest
zation shall, in addition to the United States Trade Representative,
to invest oil im-
be composed of the heads of such departments and of such other of-
which are collected
ficers as the President shall designate. It shall meet at such times
determination of
program in inter-
and with respect to such matters as the President or the chairman
notes does not vio-
of the organization shall direct. The organization may invite the
inst awards of pre-
participation in its activities of any agency not represented in the
gainst government in
are not claims
organization when matters of interest to such agency are under con-
States but are being
sideration.
government against
Oil Co. V. Zarb,
Duties
1001.
(b) In assisting the President, the organization shall-
to Congress of
(1) make recommendations to the President on basic policy
issues arising in the administration of the trade agreements
program,
annual report on
(2) make recommendations to the President as to what ac-
takes any action
tion, if any, he should take on reports submitted to him by the
shall report to
United States International Trade Commission under section
2251 (d) of this title,
993.
(3) advise the President of the results of hearings held pur-
suant to section 2412(b) (2) of this title, and recommend appro-
priate action with respect thereto, and
of 1962 hich com-
(4) perform such other functions with respect to the trade
For legislative
agreements program as the President may from time to time
Pub.L. 93-618, see
designate.
and
Adm.News,
p.
Use of resources of agencies; procedures and committees
(c) The organization shall, to the maximum extent practicable,
draw upon the resources of the agencies represented in the organi-
zation, as well as such other agencies as it may determine, including
onal Defense I 200.
the United States International Trade Commission. In addition, the
51
19
§
1872
TRADE EXPANSION PROGRAM
Ch. 7
Ch. 7
President may establish by regulation such procedures and commit-
tees as he may determine to be necessary to enable the organization
Office of the
to provide for the conduct of hearings pursuant to section
15 CFR (
2412(b) (2) of this title, and for the carrying out of other functions
assigned to the organization pursuant to this section.
§ 1873.
Pub.L. 87-794, Title II, § 242, Oct. 11, 1962, 76 Stat. 878; Pub.L.
93-618, Title I, § 171(b), Title VI, § 602(b), Jan. 3, 1975, 88 Stat.
2009, 2072; Pub.L. 96-39, Title IX, § 902(c), July 26, 1979, 93 Stat.
300; 1979 Reorg.Plan No. 3, § 1(b) (1), eff. Jan. 2, 1980, 44 F.R.
69273, 93 Stat. 1381.
Section, Pub
Oct. 11, 1962, 7
Historical Note
1979 Amendment. Subsecs. (b) (3), (c).
tive for Trade Negotiations" in subsec.
Pub.L. 96-39 substituted "section
(a), pursuant to Reorg. No. 3 of
2412(b)(2) of this title" for "section
1979, 1 1(b) (1), 44 F.R. 69273, 93 Stat. 1381,
§ 1881.
2411(c) and (d) of this title".
eff. Jan. 2, 1980, as provided by section
1-107(a) of Ex.Ord.No.12188, Jan. 2, 1980,
Except as
1975 Amendment. Subsec. (a). Pub.L.
45 F.R. 993, set out as notes under sec-
93-618, 8 602(b)(1), substituted reference
of this title
tion 2171 of this title.
to sections 2251, 2252, and 2253 of this ti-
1962, any d
tle for reference to sections 1981 and 1982
Transfer of Functions from East-West
proclaimed
of this title.
Foreign Trade Board. The East-West
Foreign Trade Board, which was estab-
ter or section
Subsec. (b) (2). Pub.L. 93-618, I
lished by Pub.L. 93-618, title IV, I 411,
602(b) (2), (3), substitated "reports sub-
countries, will
Jan. 3, 1975, 88 Stat. 2065, and classified
mitted by him" for "reports with respect
to section 2441 of this title, was abolished
Pub.L. 87-7
to tariff adjustment submitted by him"
and "section 2251(d) of this title" for
by Reorg Plan No. 3 of 1979, $ 6, 44 Stat.
69275, 93 Stat. 1381, eff. Jan. 2, 1980, as
"section 1901(e) of this title".
provided by section 1-107(a) of Ex.Ord.
Subsec. (b) (3). Pub.L. 93-618, 1
No.12188, Jan. 2, 1980, 45 F.R. 993, set out
References fill
602(b)(4), (5), substituted "hearings held
as notes under section 2171 of this title,
the Tariff Cla
pursuant to" for "hearings concerning
and the functions of the Board under
referred to 1:
foreign import restrictions held pursuant
subsecs. (a) and (b) of section 411 of
note under sect
to" and "section 2411(c) and (d) of this
Pub.L. 93-618 transferred to the intera-
title" for "section 1882(d) of this title".
gency organization established under this
section by section 5(e) of Reorg. Plan No.
Subsec. (c). Pub.L. 93-618, § 602(b) (5),
3 of 1979. See section 2441 of this title.
substituted "section 2411(c) and (d) of
Customs Dut
this title" for "section 1882(d) of this ti-
Trade Policy Committee. For provi-
tle".
sions relating to the establishment of the
Trade Policy Committee, Bee section 8 of
Effective Date of 1979 Amendment.
Ex.Ord.No.11846, Mar. 27, 1975, 40 F.R.
Amendment by Pub.L. 96-39 effective
14291, set out as a note under section
Generally 1
July 26, 1979, see section 903 of Pub.L.
2111 of this title.
Assessment on
96-39, set out as a note under section
Countervailing
2411 of this title.
Legislative History. For legislative
Change of Name. The United States
history and purpose of Pub.L. B7-794, see
Tariff Commission was redesignated the
1962 U.S.Code Cong. and Adm.News, p.
United States International Trade Com-
3110. See, also, Pub.L. 93-618, 1974 U.S.
1. Generally
mission by Pub.L. 93-618, Title I, I
Code Cong. and Adm.News, p. 7186;
"Most-favore
171(a), Jan. 3, 1975, 88 Stat, 2009. See
Pub.L. 96-39, 1979 U.S.Code Cong. and
the United St
section 2231 of this title.
Adm.News, p. 381.
ucts of all cor
"United States Trade Representative"
agreement an
Kurt S. Adler
was substituted for "Special Represents-
Supp. 943, 68
firmed 496 F.2
Library References
2. Countervall
Customs Duties @10.
C.J.B. Customs Duties DOB 17.
The imposit
United States 31.
C.J.S. United States I 31.
does not V
clause. Energ
52
19 § 2171
TRADE ACT OF 1974
Ch. 12
PART 4-OFFICE OF UNITED STATES
TRADE REPRESENTATIVE
§ 2171. Structure, functions, powers, and personnel
Establishment within Executive Office of President
(a) There is established within the Executive Office of the Presi-
dent the Office of the United States Trade Representative (herein-
after in this section referred to as the "Office").
United States Trade Representative: Deputy United States
Trade Representatives
(b) (1) The Office shall be headed by the United States Trade
Representative who shall be appointed by the President, by and with
the advice and consent of the Senate. As an exercise of the rule-
making power of the Senate, any nomination of the United States
Trade Representative submitted to the Senate for confirmation, and
referred to a committee, shall be referred to the Committee on Fi-
nance. The United States Trade Representative shall hold office at
the pleasure of the President, shall be entitled to receive the same
allowances as a chief of mission, and shall have the rank of Ambas-
sador Extraordinary and Plenipotentiary.
(2) There shall be in the Office two Deputy United States Trade
Representatives who shall be appointed by the President, by and with
the advice and consent of the Senate. As an exercise of the rule-
making power of the Senate, any nomination of a Deputy United
States Trade Representative submitted to the Senate for confirma-
tion, and referred to a committee, shall be referred to the Committee
on Finance. Each Deputy United States Trade Representative shall
hold office at the pleasure of the President and shall have the rank
of Ambassador.
Duties of United States Trade Representative and Deputy
United States Trade Representatives
(c) (1) The United States Trade Representative shall-
(A) be the chief representative of the United States for each
trade negotiation under this subchapter or section 2411 of this
title;
(B) report directly to the President and the Congress, and be
responsible to the President and the Congress for the adminis-
tration of trade agreements programs under this chapter, the
Trade Expansion Act of 1962, and section 1351 of this title;
(C) advise the President and Congress with respect to non-
tariff barriers to international trade, international commodity
agreements, and other matters which are related to the trade
agreements programs;
144
Ch. 12
Ch. 12 NEGOTIATING & OTHER AUTHORITY 19 § 2171
(D) be responsible for making reports to Congress with re-
spect to the matter set forth in subparagraphs (A) and (B);
(E) be chairman of the interagency trade organization estab-
Mined invenant to section 242(a) OFF the trade Expansion Act of of
(F) be responsible for such other functions as the President
may direct.
Presi-
(2) Each Deputy United States Trade Representative shall have
(herein-
as his principal function the conduct of trade negotiations under
this chapter and shall have such other functions as the United
States Trade Representative may direct.
Powers of United States Trade Representative
Trade
(d) The United States Trade Representative may, for the purpose
and
with
of carrying out his functions under this section-
the
rule-
(1) subject to the civil service and classification laws, select,
States
appoint, employ, and fix the compensation of such officers and
and
employees as are necessary and prescribe their authority and
on
Fi-
duties;
office
at
the
same
(2) employ experts and consultants in accordance with sec-
Ambas-
tion 3109 of Title 5 and compensate individuals so employed for
each day (including traveltime) at rates not in excess of the
maximum rate of pay for grade GS-18 as provided in section
Trade
5332 of Title 5, and while such experts and consultants are so
and
with
serving away from their homes or regular place of business, to
the
rule-
pay such employees travel expenses and per diem in lieu of sub-
United
sistence at rates authorized by section 5703 of Title 5 for per-
onfirma-
sons in Government service employed intermittently;
ommittee
shall
(3) promulgate such rules and regulations as may be neces-
the
rank
sary to carry out the functions vested in him;
(4) utilize, with their consent, the services, personnel, and
facilities of other Federal agencies;
(5) enter into and perform such contracts, leases, cooperative
agreements, or other transactions as may be necessary in the
conduct of the work of the Office and on such terms as the
for
each
United States Trade Representative may deem appropriate, with
of
this
any agency or instrumentality of the United States, or with any
public or private person, firm, association, corporation, or insti-
and
be
tution;
adminis-
(6) accept voluntary and uncompensated services, notwith-
the
standing the provisions of section 665(b) of Title 31; and
(7) adopt an official seal, which shall be judicially noticed.
to
non-
mmodity
Use of other Federal agencies
he
trade
(e) The United States Trade Representative shall, to the extent he
deems it necessary for the proper administration and execution of
145
ID #.
CU
WHITE HOUSE
CORRESPONDENCE TRACKING WORKSHEET
o # OUTGOING
Roberts / rush
H * INTERNAL
I * INCOMING
Date Correspondence
Received (YY/MM/DD)
/
/
Name of Correspondent: Craig L. Fuller
MI Mail Report
User Codes: (A)
(B)
(C)
Subject:
Trade Policy Process
ROUTE TO:
ACTION
DISPOSITION
Tracking
Type
Completion
Action
Date
of
Date
Office/Agency
(Staff Name)
Code
YY/MM/DD
Response
Code
YY/MM/DD
WHolland
ORIGINATOR 83/02/15
/
/
CUAT18
Referral Note:
D 83,02,15
583102118
Referral Note:
/
/
/ /
-
Referral Note:
/
/
/
/
-
Referral Note:
/
/
/
/
I
Referral Note:
ACTION CODES:
DISPOSITION CODES:
A - Appropriate Action
I Info Copy Only/No Action Necessary
A Answered
C Completed
C Comment/Recommendation
R Direct Reply w/Copy
B Non-Special Referral
S Suspended
D Draft Response
S For Signature
F Furnish Fact Sheet
X Interim Reply
to be used as Enclosure
FOR OUTGOING CORRESPONDENCE:
Type of Response = Initials of Signer
Code
II
"A"
Completion Date = Date of Outgoing
Comments:
Keep this worksheet attached to the original incoming letter.
Send all routing updates to Central Reference (Room 75, OEOB).
Always return completed correspondence record to Central Files.
Refer questions about the correspondence tracking system to Central Reference, ext. 2590.
5/81
12
THE WHITE HOUSE
WASHINGTON
February 10, 1983
MEMORANDUM FOR FRED FIELDING
FROM:
CRAIG L. FULLER
05
SUBJECT:
Trade Policy Process
I am putting together options for the possible reorganization
of the President's trade policy process. Congress has stated,
through legislation:
"the President shall establish an interagency
organization to assist him in carrying out the
functions vested in him by this title (Trade
Negotiations and Trade Policy Development).
Such organization shall in addition to the
Special Representative for Trade Negotiations
be composed of the heads of such departments
and of such other officers as the President
shall designate
In assisting the President,
the organization shall make recommendations to
the President on basic policy issues arising
in the administration of the trade agreements
"
program
Traditionally, the Trade Policy Committee has fulfilled
this legislative mandate. In your view, could the Cabinet
Council on Commerce and Trade meet the legislative requirements
outlined above?
Attached is the membership list of the Cabinet Council on
Commerce and Trade.
CABINET COUNCIL ON COMMERCE AND TRADE
Secretary of Commerce, Chairman Pro Tempore
Secretary of State
Secretary of the Treasury
Attorney General
Secretary of Agriculture
Secretary of Labor
Secretary of Transportation
Secretary of Energy
U.S. Trade Representative
Chairman, Council of Economic Advisers
Ex Officio Members:
The Vice President
Counsellor to the President
Chief of Staff
Assistant to the President for Policy Development
Wendell Gunn, Executive Secretary (6437)
file- Cabret
Count an
MEMORANDUM
Commerce for Trade
THE WHITE HOUSE
WASHINGTON
March 17, 1983
MEMORANDUM FOR FRED F. FIELDING
Lat's discus, ASAP
FROM:
JOHN G. ROBERTS
esk
SUBJECT:
Draft Presidential Decision Memorandum
Re: Commission on U.S. Trade Policy
Richard Darman has requested comments by close of business
March 17 on the above-referenced draft decision memorandum,
prepared by USTR William E. Brock. The memorandum recommends
the establishment of a "blue-ribbon Presidential Commission
with membership drawn from industry, labor, agriculture, and
academia" to analyze trade policy problems and recommend an
appropriate trade policy for the 1980's. Brock states in
his memorandum that such an initiative is needed to respond
to growing protectionist sentiments both here and among our
trading partners, and to review the possibly out-moded and
inadequate GATT process. Brock specifically notes that the
proposed Commission would have a long-term perspective and
would not address organization of Executive Branch trade
offices. The proposal calls for a Commission of up to
twenty-five members (and includes a list of candidates) and
a staff under the direction of retiring deputy USTR David R.
Macdonald.
I see no legal objections to the decision memorandum, but we
should take this opportunity to remind those involved of
some of the legal requirements that would accompany a
decision to establish a Commission as recommended by Brock.
The Commission would be subject to the Federal Advisory
Committee Act (FACA), 5 U.S.C. App. I § 3 (2) (B), and accord-
ingly must be established by executive order and operate
under a charter, id. § 9 (a) (1), (c). Its meetings must also
be conducted in compliance with FACA, id. § 10.
The other question of particular concern to this office is
the applicability of conflict of interest laws. Based on
descriptions in the Brock memorandum, it appears that the
Die
members of the Commission would be Special Government
Employees. Although the members are to be "drawn from"
industry, labor, agriculture, and academia, the memorandum
does not suggest that they are to represent the interests of
their respective segments of the economy in such a fashion
memo should allentics decumb
-2-
that they could be considered not to be government employees
at all. The members of the Commission would thus be subject
to 18 U.S.C. $ 208, which prohibits participation in any
matter the outcome of which will have a direct and predict-
able effect on financial interests covered by the section.
The list of possible members contains many individuals with
financial interests in international trade. The mandate of
the Commission, however, concerns such broad policy issues
that I do not think there will be any inherent section 208
problems. At this stage we should alert those concerned to
the SGE status of Commission members and the need for
consideration of conflicts questions once the Commission
charter and list of proposed members become more definite.
THE WHITE HOUSE
WASHINGTON
March 17, 1983
MEMORANDUM FOR RICHARD G. DARMAN
ASSISTANT TO THE PRESIDENT
FROM:
FRED F. FIELDING Orig. signed by FFF
COUNSEL TO THE PRESIDENT
SUBJECT:
Draft Presidential Decision Memorandum
Re: Commission on U.S. Trade Policy
Counsel's Office has reviewed the above-referenced draft
decision memorandum, and finds no objection to it from a
legal perspective.
A commission of the sort proposed in the decision memorandum
would be subject to the Federal Advisory Committee Act, 5
U.S.C. App. I, and accordingly must be established by
executive order, operate pursuant to a charter, and
otherwise conduct its business in compliance with the
requirements of the Act. Members of the commission could
be considered Special Government Employees, and it will be
necessary to address potential conflict of interest questions
once the mandate of the commission and the list
of proposed members become more definite. In short, we
need more time to review.
FFF: JGR:dgh
CC: FFFielding
JGRoberts
Subject
Chron
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
March 17, 1983
MEMORANDUM FOR FRED F. FIELDING
FROM:
JOHN G. ROBERTS
SUBJECT:
Draft Presidential Decision Memorandum
Re: Commission on U.S. Trade Policy
Richard Darman has requested comments by close of business
March 17 on the above-referenced draft decision memorandum,
prepared by USTR William E. Brock. The memorandum recommends
the establishment of a "blue-ribbon Presidential Commission
with membership drawn from industry, labor, agriculture, and
academia" to analyze trade policy problems and recommend an
appropriate trade policy for the 1980's. Brock states in
his memorandum that such an initiative is needed to respond
to growing protectionist sentiments both here and among our
trading partners, and to review the possibly out-moded and
inadequate GATT process. Brock specifically notes that the
proposed Commission would have a long-term perspective and
would not address organization of Executive Branch trade
offices. The proposal calls for a Commission of up to
twenty-five members (and includes a list of candidates) and
a staff under the direction of retiring deputy USTR David R.
Macdonald.
I see no legal objections to the decision memorandum, but we
should take this opportunity to remind those involved of
some of the legal requirements that would accompany a
decision to establish a Commission as recommended by Brock.
The Commission would be subject to the Federal Advisory
Committee Act (FACA), 5 U.S.C. App. I § 3 (2) (B), and accord-
ingly must be established by executive order and operate
under a charter, id. § 9 (a) (1), (c). Its meetings must also
be conducted in compliance with FACA, id. § 10.
The other question of particular concern to this office is
the applicability of conflict of interest laws. Based on
descriptions in the Brock memorandum, it appears that the
members of the Commission would be Special Government
Employees. Although the members are to be "drawn from"
industry, labor, agriculture, and academia, the memorandum
does not suggest that they are to represent the interests of
their respective segments of the economy in such a fashion
-2-
that they could be considered not to be government employees
at all. The members of the Commission would thus be subject
to 18 U.S.C. § 208, which prohibits participation in any
matter the outcome of which will have a direct and predict-
able effect on financial interests covered by the section.
The list of possible members contains many individuals with
financial interests in international trade. The mandate of
the Commission, however, concerns such broad policy issues
that I do not think there will be any inherent section 208
problems. At this stage we should alert those concerned to
the SGE status of Commission members and the need for
consideration of conflicts questions once the Commission
charter and list of proposed members become more definite.
-
THE WHITE HOUSE
WASHINGTON
March 17, 1983
MEMORANDUM FOR RICHARD G. DARMAN
ASSISTANT TO THE PRESIDENT
FROM:
FRED F. FIELDING
COUNSEL TO THE PRESIDENT
SUBJECT:
Draft Presidential Decision Memorandum
Re: Commission on U.S. Trade Policy
Counsel's Office has reviewed the above-referenced draft
decision memorandum, and finds no objection to it from a
legal perspective.
A commission of the sort proposed in the decision memorandum
would be subject to the Federal Advisory Committee Act, 5
U.S.C. App. I, and accordingly must be established by
executive order, operate pursuant to a charter, and
otherwise conduct its business in compliance with the
requirements of the Act. Members of the commission would in
all likelihood be considered Special Government Employees,
and it will be necessary to address potential conflict of
interest questions once the mandate of the commission and
the list of proposed members become more definite.
FFF:JGR:aw : 3/17/83
CC: FFFielding
JGRoberts
Subj.
Chron
ID # 118555
CU
WHITE HOUSE
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to be used as Enclosure
FOR OUTGOING CORRESPONDENCE:
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5/81
118555.CS
Document No.
WHITE HOUSE STAFFING MEMORANDUM
DATE: 3/14/83
ACTION/CONCURRENCE/COMMENT DUE BY: 3/17/83
SUBJECT:
DRAFT PRESIDENTIAL DECISION MEMORANDUM RE COMMISSION ON U.S. TRADE
POLICY
ACTION FYI
ACTION FYI
VICE PRESIDENT
GERGEN
MEESE
HARPER
BAKER
JENKINS
DEAVER
MURPHY
STOCKMAN
ROLLINS
CLARK
WHITTLESEY
DARMAN
P
ISS
WILLIAMSON
DUBERSTEIN
VON DAMM
FELDSTEIN
BRADY/SPEAKES
FIELDING
ROGERS
FULLER
Remarks:
May we have your comments on the attached memorandum by close of
business Thursday, March 17. Thank you.
Richard G. Darman
Assistant to the President
(x2702)
Response:
THE UNITED STATES TRADE REPRESENTATIVE
WASHINGTON
20506
February 4, 1983
MEMORANDUM FOR THE PRESIDENT
FROM:
WILLIAM E. BROCK
SUBJECT:
Presidential Commission on U.S. Trade Policy
This memorandum recommends that you establish a new Commission to examine
the foundations for U.S. trade policy and to recommend a trade policy
for the 1980's.
PROBLEM
Public support for an open trade policy is rapidly eroding because of a
growing perception that our trade policy, our trade laws, and our inter-
national trade agreements are not ensuring fair and equitable treatment
for American firms engaged in international trade. This erosion of
support for free and open trade has manifested itself in the form of
intense political pressure for protectionist action. As a result, a
national debate has evolved over the future direction of U.S. trade
policy. Unless the Administration can initiate decisive action, this
national debate could easily degenerate into partisan demagoguery
ultimately resulting in protectionist solutions.
BACKGROUND
Previous Administrations have managed protectionist pressures by strength-
ening the world trading system through multilateral trade negotiations.
These negotiations were intended to liberalize world trade and to improve
the trading rules. Unfortunately, in the current protectionist climate,
our trading partners are simply unwilling to enter into multilateral
negotiations today. This became abundantly clear during the GATT
Ministerial when our trading partners only hesitantly accepted an obliga-
tion not to adopt new protectionist measures and refused to expand the
GATT's mandate to deal with the emerging trade problems.
In light of our need to contain protectionist pressures and of the
difficulty we will certainly encounter in seeking a multilateral solution
to our current trade problems, I believe it is imperative for your
Administration to initiate a new, activist -- but not protectionist --
open trade strategy. Such a strategy should ensure that international
trade can continue its important role in disciplining our economy.
-2-
One element of this strategy is the formation of a Presidential Com-
mission to make concrete recommendations for a trade policy designed to
defend U.S. trade interests, thereby strengthening the consensus for
free and open trade. The Commission would consist of leaders and trade
experts from business, labor, agriculture, and academia, and would work
toward re-establishing the bipartisan approach to trade policy that
existed up until recent times. Consideration was given to Congressional
representation on the Commission, but it was felt that such participation
by the Congress would distort the objectivity of the Commission's findings.
However, an informal liaison will be established between the Commission
and all interested parties, including the Congress, private trade experts,
and existing advisory committees (e.g., the Advisory Committee on Trade
Negotiations). By engaging all interested parties in its work, the
Commission will focus the debate on trade policy in a fashion so as to
ensure that the Administration maintains the initiative on this issue.
In addition to giving us a means for managing domestic protectionist
pressures, the new Commission can also provide useful insight on how to
approach emerging trade issues. The trading system has changed fundamentally
since the GATT was first conceived in 1947. At that time, a homogenous
group of 23 nations acceded to the GATT as a means for preserving inter-
national competition by disciplining government intervention in the form
of trade barriers.
Today, the GATT has a heterogenous membership of 87 nations, some of
which do not have market economies. Both developed and less developed
members have adopted new, sophisticated nontariff barriers that are not
directly addressed by the GATT. The replacement of fixed exchange rates
with floating exchange rates in 1971 has dramatically heightened the
impact of foreign exchange movements on trade flows.
Because of these developments, the GATT framework may not be fully
capable of dealing with the trade problems that we face today and will
probably face tomorrow. And, since our domestic laws are designed
around the GATT framework, they too may need review. The Presidential
Commission on Trade Policy would analyze from a long-term perspective
how U.S. trade interests have been and will be affected by the changing
nature of the trading system, and may recommend a new international and
domestic legal framework for addressing the emerging trade issues of the
1980's. The organization of the Executive Branch for trade administration
and policy formation would not, however, be a part of the Commission's
work program.
RECOMMENDATION
That you establish a blue-ribbon Presidential Commission with membership
drawn from industry, labor, agriculture, and academia, to analyze the
problems and challenges of U.S. trade policy, to assess the effectiveness
of domestic and international discipline and procedures in dealing with
these problems, and to recommend an appropriate trade policy for the
1980's.
APPROVE
DISAPPROVE
Attachment
PRESIDENTIAL COMMISSION ON U.S. TRADE POLICY
Objective: To re-establish a bipartisan approach for an open U.S.
trade policy designed to maintain trade as an effective discipline
on the U.S. economy, and to establish a framework for addressing the
emerging trade issues of the 1980's.
Mandate: The Commission would be mandated to:
1)
Study the factors and developments that have influenced the
evolution of the world trading system and assess how international
and domestic trade laws and institutions have adjusted to these
developments.
2)
Assess the effectiveness of existing international and domestic
trade laws and institutions in:
-- facilitating adjustment to changing world cost and price
relationships;
disciplining unfair government intervention which distorts
trade patterns and undermines the efficient allocation
of goods and services worldwide; and
-- providing a framework for expeditiously resolving trade
disputes.
3)
Determine the extent to which government intervention in the
international marketplace has artificially influenced the evolution
of comparative advantage and international trade, thereby shifting
the burden of unemployment.
4)
Recommend a trade policy of the 1980's designed to deal with
the new realities of international trade in a fashion so as to
maintain international trade as a discipline on the U.S. economy.
Budget: $1 million assuming most of the personnel can be detailed
to work for the Commission from Executive agencies on a nonreimbursable
basis.
Staff: The staff would work under the direction of David R. Macdonald,
retiring Deputy United States Trade Representative, as Executive
Director, and would include eight professional staff members and six
support staff.
Membership: The Commission would consist of up to 25 members drawn
from the following list:
2
Agriculture
Robert Delano, President, American Farm Bureau Federation
James Dutt, Chairman and CEO, Beatrice Foods Company
James Ferguson, Chairman and CEO, General Foods Corporation
William Pearce, Corporate Vice President, Cargill, Inc., and Former
Deputy U.S. Trade Representative
Claire Sandness, Chairman, Land O'Lakes, Inc.
Robert Schaeberle, Chairman and CEO, Nabisco Brands, Inc.
Clayton Yeutter, President, Chicago Mercantile Exchange, and Former
Deputy U.S. Trade Representative
Industry
James Bere, Chairman and, CEO, Borg-Warner
James Burke, Chairman and CEO, Johnson and Johnson
Williard Butcher, Chairman, Chase Manhattan Corporation
Joseph Flavin, Chairman and CEO, The Singer Company
Robert Ingersoll, Former Ambassador to Japan, and Former CEO, Borg-
Warner
Reginald Jones, Former Chairman, General Electric Company
Paul Lyet, Former Chairman and CEO, Sperry Corporation, and Chairman
of the President's Export Council
Robert Malott, Chairman and CEO, FMC Corporation
James McKevitt, President, National Federation of Independent
Businessmen
Lee Morgan, Chairman and CEO, Caterpillar Tractor Company
John Opel, Chairman and CEO, International Business Machines Corporation
Edmund Pratt, Chairman and CEO, Pfizer, Inc., and member of the
President's Export Council
Donald Rumsfeld, President and CEO, G. D. Searle
Irving Shapiro, Former Chairman, E. I. DuPont De Nemours
Mark Shepherd, Jr., Chairman and CEO, Texas Instruments, Inc.
Edson Spencer, Chairman and CEO, Honeywell
Labor
Murray Finley, President, Amalgamated Clothing and Textile Workers
Union
Douglas Fraser, President, United Automobile, Aerospace and Agricul-
tural Implement Workers of America
John Lyons, President, International Association of Bridge, Structural,
and Iron Workers
Charles Pillard, President, International Brotherhood of Electrical
Workers
Glenn Watts, President, Communications Workers of America
Academia
Robert Baldwin, Professor, University of Wisconsin
Barbara Franklin, Senior Fellow in Public Management, Wharton
School, University of Pennsylvania
Robert Hudek, Professor of Law, University of Minnesota
John Jackson, Professor of Law, University of Michigan, Former
General Counsel of USTR
D. Gale Johnson, Professor, University of Chicago
Ray Vernon, Professor, Harvard University
3
Operation: The Commission would meet as necessary in Washington to
review analyses of trade issues prepared by outside consultants under
staff supervision. In addition, the Commission would solicit the views
of all interested parties, and would establish informal liaison with
existing advisory groups (i.e., the President's Export Council and the
Advisory Committee on Trade Negotiations) as well as trade specialists
and foreign governments. All input received by the Commission would
provide a basis for its recommendations to the President.
Timing: The Commission is expected to complete its work within nine to
twelve months of the date of its establishment.