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This is not a textual record. This is used as an
administrative marker by the William J. Clinton
Presidential Library Staff.
Collection/Record Group:
Clinton Presidential Records
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Policy Development
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Fast Track Legislative History
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100
2
3
1
3pm
THE TETHERED
65370
SMOT
PRESIDENCY
plece OA
See.
Congressional Restraints on
Executive Power
ERic
EDITED BY
THOMAS M. FRANCK
1981
New York University Press
New York & London
NEGOTIATING ABOUT NEGOTIATIONS
265
bassador Robert S. Strauss. While the results might well have
been different without Strauss's considerable efforts, the success
4
of the Tokyo Round Is largely attributable to a "untque Constitu-
tional experiment
linl cooperation between the legislative and
Negotiating About Negotiations:
executivesbranches of the Government during a complex Interna-
The Geneva Multilateral Trade Talks
tional negotiation." This chapter will describe the evolution of this
experiment.
To put the discussion in perspective, a brief summary of earlier
Robert C. Cassidy, Jr.
experiments in coordination between the Congress and the presi-
dent during international trade negotiations is In order. Beginning
with the Trade Agreements Act of 1934.5 the Congress has period-
Ically delegated to the presitient authority to implement In domes-
tic law the results of trade agreements Insofar as they relate to
tartifs. This system worked well until the Kennedy Round of Mul-
I. INTRODUCTION
Ulateral Trade Negotiations (1964-67) under the auspices of the
General Agreement on Tariffs and Trade (GATT)
A
The problem that arose In the Kennedy Round did not relate to
RTICLE 1. Section 8. clause 3 of the Constitution confers on the
tariff changes but to antidumping procedures and customs valua-
Congress the power to "regulate commerce with foreign
Nations." AI the same time, the president is the "sole organ of the
Non procedures. These Issues were a novelty in GATT negotia-
federal government In the field of International relations." Desplte
tions. The fact that they were considered at all reflects the success
the problems resented by this awkward separation of powers. the
of previous negotiations In lowering effective tariff rates through-
out the Industrial world.
United States has Just concluded and Implemented the most am-
bitlous trade negotiation since the negotiation of the General
As tariff rates declined, the effects on International trade of na-
Agreement on Tarths and Trade in 1948.
tional laws and policies other than tariffs, "nontariff barriers," be-
Given the somewhat protectionist political elimate In the United
caine more apparent. The Kennedy Round agreements on aritt-
States artsing from slow growth and persistent balance-of-trade
dumping and customs valuation represent the first serious attempt
deficits. the success of the Tokyo Round Is somewhat surprising.
to expand the GATT system specifically to the significant problem
Congressional approval of the legislation approving and Iniple-
of nontariff barriers. However, neither U.S. lawe nor the U.S. Con.
menting the Takyo Ronnd results-by massive majorities in both
gress contemplated this kind of agreement resulting from the Ken.
houses. after only thirty-four days of formal consideration-ap-
nedy Round. The result was that the undertakings relating to DUS.
pears 111 many people to In. astomding"
terms valuation were never Implemented by Congress. Although
to the extent the press noted this unusual event at alls "
the president entered Into the Antidumping Code, the Congress
tended to attribute the success of the enterprise to the skill of Am-
adopted legislation. which became law, specifically requiring exist.
ing domestic legislation to prevall over the code.'
The opinions expressed in this chapter are those of the author and do
When preparations for a seventh round of GAT i I negollations,
not necessarth reflect the opinions of the Office of the United States
Trade Representative.
the Tokyo Round. began in the late 1960s. the executive branch
had to face in earnest the Issue of noutariff barriers. They needed
270
THE TETHERED PRESIDENCY
NECOTIATING ABOUT NEGOTIATIONS
271
the president submits an "implementing bill" and Congress, by a
any previous legislation, it left a great deal to be Implemented In-
voting majority of both Houses:
formally by both Congress and the executive branch. From early
1975 until late in 1977 there evolved a process of consultation that
(1) approves the agreement.
was generally satisfactory to both sides. It Is probably fortunate
(2) makes changes or additions to domestic law necessary 10
that the trade negotiations moved very slowly during this period.
Implement the agreement. and
As a result. both Congress and the executive agencies, particularly
(3) approves a statement describing changes in administrative
STR. were able to devote considerable time to developing the pro-
practice proposed to implement the agreement,
cess as opposed to discussing substantive policy issues. In partic-
and the bill Is signed by the president. Administration demands
ular, personal relationships developed between Individuals in STR
for rapid congressional action on trade agreements were addressed
and members and staff on the Hill. These relationships contrib-
by the creation of special procedural rules to accelerate congres.
uted importantly to the ultimate success of the process. Once the
sional consideration of an Implementing bill. The procedures are
negotiations began to move.quickly. In 1978, there was in place an
designed to result In a final congressional decision within ninety
operating system that could react quickly to unfolding events.
working days after an implementing bill Is introduced Important
Before reviewing the different aspects of this system, it Is impor-
features of these procedures are automatic discharge of the Imple-
tant to understand how The Ways and Means Committee and the
menting bill from committee after a set period, usually forty-five
Finance Committee oversee a program when there is no legislation
working days. and a limitation of floor debate to twenty hours.
relating to that program before the committees. Both committees
Most Important, an Implementing bill cannot be amended In com-
rely heavily on a few members who become "experts" on the sub-
mittee or on the floor by either house.²⁶
ject. These members are usually on the subcommittee responsible
Although the positive approval requirement was the most signif.
for the program. Nonexpert members will typically pay attention
lcant amendment affecting congressional-executive consultation
to a program only when a specific problem of a constituent arlses
during the trade negotiations, the Finance Committee made an
or when new legislation comes before the committee. Even the
Important modification to the House bill provision creating
expert members rely heavily on the committee staff for guidance
congressional advisers. The amendment requires the special rep-
on all but the most general policy issues. The result Is that the
resentative for trade negollations (STR) to keep both congressional
responsibility for oversight normally falls on the staff with an oc-
advisers and designated members of the Finance Committee's and
casional intervention by a member.
the Ways and Means Committee's staffs "currently Informed" on
the status of negotlations. Under this provision. STR supplied
A. INFORMATION
the two committees with most position papers and reporting cables
Section 161(b) of the Trade Act of 1974 (19 U S.C. 2211) requires
relating to the trade negotiations. As a result. the congressional
STR to keep congressional advisers currently Informed. Early In
committee stalls were able to carry on current and detailed discus.
1975. the House and Senate committee staffs met with the special
storts about the negatiations with both the administration and
representative for trade negotiations, Ambassador Dent. to sign a
members of the committees
memorandum of understanding Implementing Section 161. Under
this agreement. STR committed itself to supplying both commit-
111. IMPLEMENTATION OF THE TRADE ACT
lees In a timely manner with Incoming and outgoing cables relat-
Ing to the trade negotiations. The committees agreed to obtain ap-
Although the Trade Act of 1974 contains provisions governing
propriate security clearances for their staffs and to follow
congressional-executtve consultation that are more elaborate than
prescribed procedures for handling classified documents.
272
THE TETHERED PRESIDENCY
NEGOTIATING ABOUT NEGOTIATIONS
273
A formal agreement was considered necessary in light of State
dialogue between Congress and the administration left the trade
Department opposition to disclosure of internal executive branch
negotlators with a clear Idea of the political parameters within
communications. This opposition manifested Itself in threats to in-
voke executive privilege and refusal to deliver certain "sensitive."
which they were working. It also gave the members of Congress
some assurance that the negotiators were seeking results that
cables to STR for lear they would be turned over to Congress.
were politically acceptable.
State eventually agreed to comply with Section 161 in light of the
memorandum of understanding and a side agreement between the
Department and STR. Under the side agreement. only cables be-
B. TRAVEL
tween Washington and Geneva relating lo the trade negotlations
could be supplied to Congress. Cables from or to other posts were
Politics and economics astde. one of the most Interesting aspects
not supplied even though they related to the negotiations.
of International trade policy Is the possibilities it presents for for-
The information aspect of consultation worked fairly well. Some-
elgn travel This lure was used effectively by both the members of
what to the surprise of executive branch officials, no cable sup-
Congress responsible for trade and by the STR to keep nonexpert
plied to the Congress between 1975 and 1979 was disclosed to any
members Interested In the subject. The Ways and Means Com-
person without appropriate clearances.
millee and the Finance Committee sponsored one or more foreign
The major congressional complaint was the week or SO delay
trips each year for members to discuss trade Issues with foreign
between the Ume a cable was sent from, or received In. Washing-
officials and American negotiators in Geneva.
ton and its delivery to the committees. The committee staffs were
Both the members of Congress and the American negotiators,
occasionally disturbed by the fact that STR was abviously not
many of whom had never spoken with a member of Congress, ap-
sending all cable traffic relating to the trade negotations. How-
parently thought the trips valuable. On the congressional side, the
ever. virtually all Important cables were supplied to the HOL Al-
members say that personal contact with foreign and American ne-
though committee members rarely asked to see cables. they were
gottators gave them a better understanding of the International po-
regularly used by staff as the basis for briefings.
litical dynamics of the talks. Conversely, the American negotiators
A significant feature of the consultation process while the trade
got a very clear view of the problems they would face when they
returned to Congress with trade agreements.
negotiations were In progress was that members of Congress and
the committee staffs almost never made definitive statements for
In addition to travel by members, which was relatively rare, the
committee staffers responsible for trade traveled to Geneva on a
or against specific negotiating proposals put forward by STR. This
regular basis. This allowed them to vertfy Information received In
conselous attempt by the HIII to avoid commitments did not pre-
vent frequent discussion of details between STR and the commit-
cables. It also exposed them to the day-to-day problems of the ne-
gollators and vice versa.
tee staffs. It did require STR to rely heavily on the advice It re.
celved from its private advisory committees.
While 11 Is not possible to prove that the congressional presence
bose committees were established under the Trade All of
In Geneva, either of members or stalls. was essential to the con-
1974 2" They were composed of private citizens representing a
sultation process, both the executive and congressional particl-
broad anay of Industrial, labor. and agricultural Interests. The
pants believe 11 was one of the catalysts that made the system
committees were Informed of current developments In the trade
work. It permitted serious and relatively uninterrupted discussions
negotiations and provided guidance on specific STR proposals.
of the domestic and International political Issues In the trade ne.
Despite congressional besitance 10 give specific guidance, the
gotiations. Furthermore, many American negotiators believe that
allowing congressional representatives to discuss their concerns
Westview Press
MAKING
GOVERNMENT WORK
From White House to Congress
edited by
Robert E. Hunter, Wayne L. Berman,
and John F. Kennedy
Center for Strategic & International Studies
Georgetown University
CSIS
9
The System CAN Work
policy. Presidents, for example, have occasionally tried to exercise in-
ternational trade powers properly reserved to Congress. And, on occasion,
Congress has attempted to exercise the powers of the presidency.
At the same time, the nature of problems in international economic
1
relations has become increasingly complex. The objective of trade lib-
eralization has evolved from the reduction and elimination of tariffs to
the negotiation of international rules on nontariff barriers.
The growth of economic interdependence during the postwar period
The System CAN Work:
has tested the existing political and legal mechanisms for governments
The Trade Act of 1979
in negotiating reciprocal reductions in the import duties they levy on
imported goods at their borders. Yet, it is much more difficult for
governments to negotiate international rules for nontariff barriers that
Richard R. Rivers
indirectly affect trade and that may originate within state houses or
even city halls.
For the United States, this trend toward economic interdependence
and the proliferation of nontariff barriers has imposed a growing strain
Executive-Legislative Partnership
on the political and legal mechanisms for the conduct of international
In International Commercial Policy
trade negotiations. These forces culminated in 1967 with the 90th
Within most democratic governments, the conduct of international
Congress's express repudiation of an international code of conduct on
commercial policy is the joint responsibility of the executive and legislative
antidumping that had been negotiated by executive branch officials
branches. This division of powers exists in varying degrees in most
during the Kennedy Round of trade negotiations. The antidumping code
Western political systems. Nowhere, however, is this joint responsibility
set the international rules by which governments must abide as they
more evident than in the unique governmental system of the United
regulate imports sold in their national markets at prices below home
States. This case study discusses the partnership between the president
market prices-a politically sensitive subject for Congress. In effect,
and Congress for the conduct of U.S. trade policy, how this partnership
Congress told both U.S. and foreign negotiators that, although they
became strained during the 1960s, and how it was renegotiated with
could negotiate and reach any international agreement they might wish,
apparent success during the 1970s.
Congress could not be taken for granted, and the necessity for imple-
Under the U.S. Constitution, Congress is vested with the power to
mentation in domestic law through legislation could not be circumvented.
regulate foreign commerce. The president is the country's chief negotiator
This regrettable episode in executive-legislative relations created an
and representative in the international arena. Throughout U.S. history,
atmosphere of suspicion and mistrust between the two branches and
Congress and the president have carried out these mutual and interacting
between the United States and its trading partners. Under such circum-
roles diligently, if not always harmoniously.
stances, the conduct of U.S. commercial policy became exceedingly
This system has gradually given rise to open rivalry as the two
difficult, if not altogether impossible. Foreign government officials, par-
branches have undertaken to carry out their constitutional roles and
ticularly those of The European Communities and Canada, came to
respond to their different constituencies in the conduct of foreign economic
doubt the credibility of U.S. negotiators and used that doubt as justification
for not engaging the United States in negotiations on nontariff trade
barriers.
Richard R. Rivers is a partner in the law firm of Akin, Gump, Strauss, Hauer & Feld.
In 1971, against this background of growing concern about the effects
Before entering private law practice, he served as general counsel of the Office of the
of nontariff barriers on trade and of mistrust between the executive
Special Representative for Trade Negotiations in the Executive Office of the President.
Rivers has also served as international trade counsel of the Committee on Finance of the
and legislative branches, the Nixon administration began exploring ways
United States Senate, participated in the preparation and enactment of the Trade Act of
to renegotiate the trade-policy partnership between the executive branch
1974, and subsequently served as a congressional staff adviser to the U.S. Delegation to
and Congress and to seek a renewed delegation of trade-negotiating
the Multilateral Trade Negotiations in Geneva, Switzerland.
authority from Congress. These efforts resulted in a negotiation between
8
10
Richard R. Rivers
The System CAN Work
11
Congress and the executive and the enactment of the Trade Act of 1974,
self-executing and may have domestic legal consequences, such as
which created an unprecedented statutory framework within which the
regulating foreign commerce by restricting imports at the border or
branches could perform their respective constitutional roles. This unique
raising revenues, which require congressional approval and implemen-
"experiment in constitutional government," as the Senate Finance Com-
tation before having force and effect as domestic U.S. law.
mittee termed it, resulted seven years later in Congress's passing the
The joint executive-legislative responsibility is a feature of most
most comprehensive trade legislation of the postwar era, if not indeed
democratic systems, including parliamentary governments. The circum-
the country's history, by an overwhelming margin.
stance of a negotiator exceeding his or her legal authority and political
The chain of events, which began with congressional repudiation of
capability is a potential problem for any government participating in
an antidumping code in 1967, led to the renegotiation and innovative
international negotiation. These problems are manageable, however, for
redesign of the executive-legislative partnership in 1974 and resulted in
most parliamentary Western governments. In economic unions, such as
the passage of the Trade Agreements Act of 1979, is often suggested
The European Communities, they present difficult political, if not legal,
as a model of executive-congressional collaboration in the field of foreign
problems. Because of the unique design of the U.S. constitutional system,
affairs. Without prejudging the validity of such a model, this chapter
these problems pose special challenges for the conduct of U.S. commercial
describes the modern evolution of the trade-policy partnership between
relations-challenges that have not always been met or successfully
the executive and legislative branches and its operation, which, in effect,
overcome.
broke down and had to be renegotiated by the parties during the Tokyo
Round of Multilateral Trade Negotiations (MTN) from 1973 to 1979.
U.S. Commercial Policy
The Constitutional Base
Prior to 1934, the tariff policy of the United States was set by Congress
The U.S. Constitution established a federal government with three
primarily to raise revenues and protect domestic production from import
branches, a separation of powers, a system of checks and balances
competition. Little, if any, attention was given to the consequences of
among those branches, and the president as the chief executive. Inherent
U.S. tariff policy for the external relations of the United States or for
in the presidency is the foreign affairs power by which the president
the world economy.
has emerged as the chief negotiator and representative of the United
In 1934, motivated by a desire to restore world trade and prompted
States in the international arena. The primacy of the president in the
by the exemplary leadership of then-Secretary of State Cordell Hull,
field of foreign affairs, however, is not without qualification, as the
President Franklin Delano Roosevelt requested and received from Con-
Constitution itself imposes several limits on presidential powers, such
gress advance authority to reduce tariffs in reciprocal negotiations with
as vesting the power to declare war in Congress and requiring that
other countries from the levels designated in the Smoot-Hawley Tariff
treaties be submitted to the Senate for its advice, consent, and concurrence.
Act of 1930. This presidential action marked the beginning of the
Yet over the years the executive branch has developed various forms
Reciprocal Trade Agreements Program and offers a modern example of
of executive agreements, which-depending upon their nature and
executive-legislative cooperation in the field of U.S. commercial policy.
content-may or may not be submitted to Congress for approval and/
Following World War II, the United States took the lead in the design
or implementation.
and construction of the postwar world economic order. At the 1944
In the field of international trade policy, the president's powers are
international conference at Bretton Woods, and in later international
Congress: strictly constrained by two powers the Constitution explicitly vests in
conferences, the U.S. delegation proposed the creation of an international
trade organization (ITO) and an international agreement for the regulation
of trade among nations. Faced with growing opposition from a suspicious
the power to regulate commerce with foreign nations
Congress, however, the executive branch abandoned its plans. The ITO
the power to lay and collect taxes, duties, imposts, and excises
never came into existence, and U.S. accession to the General Agreement
(Article I, Section 8)
on Tariffs and Trade (GATT) was accomplished by means of an executive
agreement, which the Congress refused to recognize and never approved.
As a practical matter, presidents may negotiate and enter into virtually
Despite this inauspicious beginning, the executive branch secured
any international agreement they desire. Such agreements may not be
from Congress the authority to reduce U.S. tariffs in the context of
13
12
Richard R. Rivers
The System CAN Work
reciprocal trade negotiations. Under the auspices of GATT, six rounds
action but agreed to a compromise, which provided for implementation
of tariff negotiations were held that steadily reduced tariffs, especially
only insofar as the provisions of the code were consistent with those
among the industrialized democracies.
of existing U.S. law and practice. Any conflict between the two was to
As tariffs declined, the volume of world trade increased markedly in
be resolved in favor of the law as it had been administered previously.
proportion to overall industrial production. As tariffs were lowered,
In effect, Congress took steps to nullify the antidumping code insofar
however, more subtle and insidious barriers replaced them as the major
as it differed from U.S. law.
obstacles to trade. Known as nontariff barriers, they came in such forms
The entire episode poisoned executive-legislative relations in the field
as subsidies, import licensing systems, customs valuation methods,
of international trade. Senator Russell B. Long (D-La.), the chairman of
discriminatory product standards, and government purchasing require-
the Senate Committee on Finance, published a law review article entitled
ments. These governmental practices were deeply rooted in national
"United States Law and the International Antidumping Code" in which
laws and regulations and often served legitimate domestic interests,
he concluded:
such as regulation of domestic industries, maintenance of domestic prices
for international commodities, and the preservation of important in-
The international antidumping code was negotiated without advance
dustries for national security reasons.
authority by Congress, in the face of a strict admonition by the Senate
Such governmental practices, however, seriously distorted world trade
not to change the antidumping act in any way. Apart from the question
and created inefficiencies in the world economy. GATT, moreover, did
as to whether the President has authority to enter into international
not address many of these practices. Even those nontariff barrier practices
agreements with foreign nations in an area which the Constitution reserves
that GATT restricted, such as export subsidies on nonprimary products,
exclusively to the Congress, it is settled law that when an agreement has
were addressed by rules that had proved vague, ineffective, and unen-
the effect of changing existing domestic law, either directly or by indirection
forceable over the years. In fact, many provisions of GATT had fallen
through giving the law a meaning and a result which Congress never
into disuse and discredit, including procedures for settling disputes.
intended, the agreement cannot be given effect until it has been submitted
Although the reduction of tariffs was the principal object, during the
to Congress for implementing legislation.¹
Kennedy Round of trade negotiations, certain participating governments
undertook to negotiate nontariff barrier agreements. In particular, the
The Nixon administration entered office in January 1969 without
United States agreed to eliminate the highly protective American Selling
tariff-cutting authority (the five-year authority granted by Congress in
Price system of customs valuation applied to imports of certain com-
the Trade Expansion Act of 1962 had expired at the end of 1967).
modities and agreed to adhere to an international antidumping code
Moreover, both inside and outside of government it was thought to be
regulating the responses of governments to imports sold below fair
imperative that nontariff barriers had to be subjected to the discipline
value. The decision by the executive branch to negotiate on nontariff
of international rules. But there seemed little prospect, however, for
of
barriers in the Kennedy Round was made in the face of express
obtaining the special authority required from a distrustful Congress,
congressional opposition to negotiating such matters and was carried
and, indeed, an attempt at trade legislation failed in 1971.
out under the general foreign affairs power of the presidency.
In July 1971, the Williams Commission, a commission on international
At the end of the Kennedy Round, Congress reneged on the executive
trade and investment policy, reported "a growing concern in this country
branch commitments and declined to repeal the American Selling Price
that the United States has not received full value for the tariff concessions
system. Despite the agreement of the U.S. negotiators to repeal the
made over the years because foreign countries have found other ways,
provision, the provision remained U.S. law.
besides tariffs, of impeding our access to their markets."² Slowly, a
Furthermore, Congress acted affirmatively to alter the terms of U.S.
consensus began to evolve within the U.S. government that a new round
adherence to the antidumping code. In the first session of the 90th
of trade negotiations should be held. President Richard Nixon bluntly
Congress in 1967, a resolution was offered in the Senate demanding
brought the issue to the forefront internationally and to the attention
that the international antidumping code be submitted to the Senate for
of U.S. trading partners with his actions of August 15, 1971-most
its advice and consent. Later, in September 1968, the Senate passed an
particularly the closing of the gold window and the imposition of a
amendment that would have terminated U.S. adherence to the terms of
surcharge on imports. These developments led to the Tokyo Declaration
the agreement. The House refused, however, to go along with the Senate
of September 1973, which called for a new international round of trade
14
15
Richard R. Rivers
The System CAN Work
negotiations, to be known as the Tokyo Round, under the auspices of
procedures that were inconsistent with the traditional roles of the
GATT. These multilateral negotiations would be aimed not only at further
executive branch and Congress. "That's not the way our laws are made,"
tariff reductions but also at nontariff barriers.
Talmadge told Finance Committee staff persons. Instead he proposed
Although it was widely agreed that a new and ambitious round of
that the president simply submit nontariff barrier trade agreements to
negotiations on nontariff barriers to trade should be held, the problem
Congress to be considered in the conventional manner. Executive branch
of U.S. negotiating authority remained, with the executive branch needing
officials took the position that such a procedure would leave them
to secure explicit and credible authority from Congress to engage in
without credibility at the negotiating table.
international negotiations on such practices. Work began within the
Senator Talmadge asked the Senate Finance Committee staff to search
executive branch on the design of a trade bill. The legislation that finally
for a compromise. The Finance Committee staff proposed that the House
emerged contained a number of major executive branch initiatives,
and Senate agree to amend their rules to provide for a mandatory up
including a proposal to grant most-favored-nation (MFN) status to the
or down vote by Congress, without amendments, within a statutory
Soviet Union. In many ways, however, the most significant provision
deadline. The legislation would direct the president to negotiate on
of the 1973 Nixon trade bill was in the important and difficult area of
nontariff barriers to trade and to submit his agreements, and whatever
nontariff barriers. In addition to seeking advance tariff-cutting authority,
implementing legislation was necessary or appropriate, to Congress for
the executive branch sought a negotiating mandate on nontariff barriers
consideration under the new procedures. The procedures would pass
and advance presidential authority to implement them in U.S. law, unless
muster under the Constitution because both House and Senate would
either the House or the Senate voted to override the president's proposal
act. The international agreements would not "enter into force for the
within a period of 90 days after notification-a one-House veto.
United States" unless Congress approved.
This unprecedented delegation of congressional authority to the pres-
The bill, as amended by the Senate, elaborated upon the provisions
ident was approved by the House of Representatives and sent to the
that the House had added to increase the participation of the public,
Senate in essentially the form it had been submitted to Congress by
Congress, and various governmental agencies in the negotiations. Ex-
the executive branch. In the Senate, however, the administration's proposal
tensive prenegotiation hearings and advice would be required. In addition,
predictably ran into strong opposition. Still angry about the Kennedy
the legislation established an elaborate, private sector advisory system
Round experience and believing that U.S. negotiators had turned deaf
to include representatives of labor, industry, agriculture, and consumers
ears to congressional admonitions and private sector advice regarding
to provide policy input and technical advice during the negotiations.
the negotiations, key members of the Senate Finance Committee balked
These private sector advisory committees would be required to issue
when briefed by committee staff on the provisions of the House bill.
official reports during and at the conclusion of the negotiations. Private
During the 20 months of congressional consideration following sub-
sector advisers were to be kept intimately informed during the course
mission of the trade bill much had occurred. In October 1973 the
of the negotiations and, to the extent that the executive branch deviated
Organization of Petroleum Exporting Countries (OPEC) oil embargo
from their advice, the president was required to inform Congress as to
darkened the world and, shortly thereafter, had plunged the world
its reasons.
economy into a deep recession. In addition, President Nixon had resigned
The Finance Committee also proposed that the capability of Congress
from office. His successor, President Gerald R. Ford, had renewed the
to monitor U.S. trade policy during the negotiations be strengthened in
previous administration's request for enactment of trade legislation, partly
the legislation. In addition to the procedures established for the approval
in an effort to head off spreading global protectionism. The legislation
of the nontariff barrier agreements, five members of the Senate and five
was being considered in the Senate in an entirely different political
members of the House were to be designated as official advisers to the
climate. Not surprisingly, given the passage of time and changed cir-
U.S. trade delegation. Staff members of both the House Ways and Means
cumstances, the bill underwent major revision in the Senate Finance
Committee and the Senate Finance Committee would be given access
Committee.
to classified U.S. materials and kept abreast of the negotiations on a
In the judgment of the Finance Committee staff, the House bill
detailed and ongoing basis.
proposed "the largest delegation of trade negotiating authority to the
As amended by the Senate, close coordination and consultation on
executive in history." In the view of Senator Herman Talmadge (D-Ga.),
legislation formed an iron triangle between executive branch negotiators,
the House bill, with its legislative veto procedure, would establish
Congress, and the private sector, with three types of advisory committees
17
16
Richard R. Rivers
The System CAN Work
being established. The first would be an overall policy level advisory
(a) government procurement policies (b) quantitative restrictions
committee for trade negotiations to be composed of senior representatives
and import licensing (c) customs valuation (d) subsidies and
of government, labor, industry, agriculture, service industries, consumer
countervailing duties (e) product standards
interests, and the general public. Second, by amending the House bill,
5. Safeguards Group-in charge of international rules relating to
the Senate gave the president authority to establish policy advisory
countries imposing temporary import restraint to prevent injury
committees for industry, labor, and agriculture to provide general policy
to a domestic industry caused by increased imports
advice to U.S. negotiators during the negotiations. Third, the Senate
6. Tropical Products Group-intended to permit concessions to the
legislation provided that the president should establish such industry,
developing countries from the developed countries
labor, service, or agriculture sector advisory committees as he thought
7. Framework Improvement Group-intended to permit discussion
necessary for technical advice on tariff and nontariff barrier negotiations.
of proposed changes in GATT rules, in particular, GATT rules
Qualified experts from particular industries were to advise trade ne-
governing dispute settlement.
gotiators from the point of view of their personal expertise and not
from the point of view of their particular employers. The advice they
It was not, however, until early 1977 that the negotiations began to
gave the trade negotiators would also be shared with Congress.
show signs of life. In March 1977, President Jimmy Carter appointed
The Senate amendments were negotiated in conference with the House
Robert S. Strauss, the former chairman of the Democratic Party, as his
and sent to President Ford as the Trade Act of 1974. This legislation
special trade representative (STR), an appointment that apparently was
provided the basic charter for U.S. participation in the Tokyo Round
made after consultation with key members of Congress and that was
and established the unique system under which the negotiated trade
well received by the private sector. A lawyer and businessman, Strauss
agreements would be approved and implemented into U.S. law.³ Congress,
knew little about international trade, but he had a fine sense for domestic
acting in the light of its experience in prior negotiations, renegotiated
politics and Congress.
with the executive branch the terms of their partnership for the conduct
President Carter, early in his presidency, signaled his commitment
of U.S. trade policy. The result was a system of mandatory consultation
to pursuing the MTN to a successful conclusion. At the Downing Street
and coordination so stringent that the executive could ignore it only at
Summit, President Carter and Japanese Prime Minister Takeo Fukuda
peril of losing all in a single vote.
strongly supported continuing the trade negotiations in the face of
recalcitrant European heads of state, particularly French President Giscard
d'Estaing. Gradually the international negotiating process began to gather
The Negotiating Process
momentum.
Although the Tokyo Round began formally with the Tokyo Declaration
By July 1977, the United States and The European Communities (EC)
of September 1973, the negotiations did not commence in Geneva until
were able to agree on a timetable to complete the preparatory phase
Congress had passed the Trade Act of 1974 in January 1975. Two and
of the MTN. The negotiations of the Tokyo Round-in reality a hundred
one half years passed with few significant occurrences, however, largely
or more ongoing negotiations among a hundred or more countries—
because of global recession and the uncertain U.S. presidency. During
had begun in earnest and were moving ahead under the relentless
this period the participating governments occupied themselves by pre-
prodding of Ambassador Strauss.
paring the technical basis for the negotiations. The Trade Negotiating
The executive branch and Congress had acted early in 1975 to
Committee in charge of the Tokyo Round established the following
implement the private sector advice and consultative provisions contained
seven negotiating groups to deal with specific subjects:
in the Trade Act of 1974. Periodic briefings of members of Congress
and committee staffs by the STR, his deputies, and staff and regular
1. Tariffs Group
access by the congressional committees to MTN documents had com-
2. Sectors Group-intended to permit negotiations of all issues af-
menced shortly thereafter.
fecting specific industrial sectors (e.g., civil aircraft)
Congressional staff began traveling to Geneva in 1975 and preparing
3. Agriculture Group
regular reports of the negotiations for senators and representatives.
4. Nontariff Measures Group-including five sub-groups dealing with
Senators and their staffs attended multilateral and bilateral negotiating
the following issues:
sessions, met with officials of foreign delegations and of the GATT
18
Richard R. Rivers
The System CAN Work
19
Secretariat, and held regular consultations with STR officials in both
Ambassador Strauss approached the negotiations with the perspective
Washington and Geneva.
of a domestic politician, recognizing that there must be something in
These briefings of private sector advisers, members of Congress, and
the package for everyone but that no single interest could have its way
committee staff were anything but perfunctory. Private sector and
entirely. This was applied both internationally and domestically.
congressional advisers insisted on being kept fully informed on the
Internationally, Ambassador Strauss sought to convince participating
negotiations. Moreover, the government actively sought the views of the
countries that the negotiations would contain positive benefits to their
private sector advisers, and more often than not, incorporated their
economies and would present a balanced package that each negotiator
advice into U.S. negotiating positions. Senior STR officials often went
could bring home for domestic approval and implementation. At the
from negotiating sessions with foreign governments to negotiating ses-
same time, in terms of domestic politics, Ambassador Strauss selected
sions with private sector advisers.
a combination of concessions to be given and gained that were not only
A negotiator on the sensitive and difficult Code on Subsidies and
in the national economic interest, but also struck an appropriate political
Countervailing Duties, for example, would spend two weeks in Europe
negotiating with officials of The European Community. He would then
balance between competing domestic interests-whether they were re-
return to Washington and participate in a round of interagency meetings
gional, agricultural or industrial, multinational or domestic exporter or
and in the private sector advisory system where he was likely to run
importer, consumer or producer. For example, it might become necessary
a difficult question and answer gauntlet. He had to read the draft
to trade away long-standing and important import protection for the
Industrial Sector Advisory Report (ISAR) of each Industrial Sector
domestic bourbon industry in order to gain valuable agricultural trade
Advisory Committee (ISAC) with whom he would be meeting and
concessions from The European Communities. The bourbon concession
understand their particular objectives and concerns in the field of subsidies
could have negative consequences in such bourbon producing states as
and countervailing duties. This process created a high degree of com-
Kentucky, but, if the trade concessions gained at the expense of the
munication and consultation between Congress, its key trade committees
bourbon industry included tariff concessions on tobacco, then the political
and their staffs, the many private sector advisory committees, and
damage in Kentucky would be offset or even overcome.
officials of the special trade representative's office.
By the fall of 1978, the full scope of the Tokyo Round was apparent.
The office of the STR, headed by Ambassador Strauss and his principal
There were hundreds of bilateral "request and offer" agreements on
deputies-Alan Wolf in Washington and Alonzo McDonald in Geneva-
nontariff barriers between participating governments as well as tariff
became a domestic and international clearinghouse in which tens of
reductions as significant as those of the Kennedy Round on thousands
thousands of pieces of data-economic and political-concerning foreign
of industrial and agricultural products. In addition there were the
and domestic interests could be processed and arranged. Transcripts of
multilateral codes of conduct on the major nontariff barriers, the principal
presentations by STR officials were available in private reading rooms
ones of which were:
at the Department of Commerce and in the special trade representative's
office for all persons having appropriate security clearances. Ambassador
Strauss was in daily contact with members of Congress and key private
The Subsidies-Countervailing Duty Code-regulating the use of
sector advisers, as well as with his negotiating counterparts. On occasion,
subsidies and the responses governments may take either unilaterally
foreign trade officials had direct contact with members of Congress and
or through multilateral dispute settlement
private sector advisers. These meetings were carefully monitored and
The Antidumping Code-revising and updating the code that reg-
coordinated with the STR officials.
ulates the actions governments may take in response to dumped
Both domestically and abroad, Ambassador Strauss was perceived as
imports
having the confidence of both the president and Congress. He frequently
The Government Procurement Code-liberalizing government pro-
made it clear that his effective function in office required serving two
curement and eliminating discrimination
masters. There was no doubt that the STR spoke with the full authority
The Customs Valuation Code-harmonizing national customs val-
of both the president and Congress.
uation laws and practices
Within the executive branch, the special trade representative enjoyed
The Licensing Code-regulating governmental import licensing prac-
primacy in all matters relating to the trade policy of the United States.
tices
20
Richard R. Rivers
The System CAN Work
21
Civil Aircraft Code-a sectoral agreement eliminating duties on
expressed opposition, Ambassador Strauss immediately ordered nego-
civil aircraft and parts and applying to a range of nontariff barriers
tiators in Geneva to make readjustments.⁵
on aircraft
Committee sessions continued throughout the spring. On April 12,
Framework Arrangements-relating to dispute settlement and other
the United States concluded a procés-verbal with its trading partners in
general GATT matters
Geneva. In early May, the Committees on Finance and on Ways and
Safeguards Code4-relating to the measures governments may take
Means met in a "nonconference" to reconcile their differences.
to provide temporary import relief to industries seriously injured
During this domestic implementation process, private sector groups
by imports
engaged in heavy lobbying of congressional committees and the executive
branch officials, as when STR officials met regularly with representatives
of domestic industries. These meetings produced a number of proposed
amendments to existing law, aimed at strengthening the unfair trade
Concluding and Implementing the Tokyo Round
practice statutes, in particular, the antidumping and countervailing duty
Winding down the negotiations in January of 1979, President Carter
statutes. Although these amendments were not, strictly speaking, nec-
followed the procedures set forth in the Trade Act of 1974 and notified
essary for the implementation of the Tokyo Round agreements, they fell
Congress of his intention to enter into the Tokyo Round trade agreements.
into the category of "appropriate" changes provided for under the Trade
This notice set in motion the intricate, bank-vault-time-lock procedures
Act of 1974. The amendments did not contravene the international
established under the Trade Act of 1974. Shortly thereafter, the STR
agreements but made mainly procedural changes to appease the domestic
office began sending detailed proposals for approving and implementing
interests of those who had long been critical of import relief statutes.
the trade agreements and for making other "appropriate" changes in
The definition of material injury, which would be incorporated for the
the U.S. law to the Senate Finance Committee, and the House Ways
first time into the U.S. countervailing duty statute, was a particularly
and Means Committee.
difficult issue.
Under an agreement initiated by the Senate Finance Committee staff,
As a practical matter, the negotiating sessions with domestic industries
the administration had agreed to consult and work closely with Congress
added a new and strong source of political support for the passage of
in drafting the implementing bill before it was submitted to Congress
the Trade Agreements Act. Whereas importers and exporters-who were
by the president and therefore became unamendable. The proposals that
benefited by trade liberalization-had long supported the Tokyo Round
the administration sent to the House and Senate committees were
process, such domestic industries as steel previously had hoped to gain
contained in detailed papers setting forth the method for setting inter-
little. As these industries saw an opportunity to improve the operation
national obligations of the United States into U.S. domestic law. The
of the unfair trade practice statutes, the Trade Agreements Act came to
staffs of both committees briefed their members in detail on each of
have the support of both the weak and the strong in international
the administration's proposals, and both committees held public hearings
competition.
in February and April 1979. The administration's plans for implementing
The actual text of the Trade Agreements Act was drafted by the
the Tokyo Round were shared with private sector advisers.
Senate and House legislative counsels in sessions attended by admin-
The Senate Finance Committee and the Subcommittee on Trade of
istration officials and committee staff persons.6 The drafting group
the House Ways and Means Committee began holding closed mark-up
produced a comprehensive committee print of the bill entitled "Office
sessions on the implementing legislation in March 1979, at which time
of the Special Representative for Trade Negotiations Draft Proposal."
the Senate Committees on Agriculture and on Commerce also met to
This draft was circulated among executive branch agencies for intensive
consider the aspects that fell within their respective jurisdictions. A
review, which resulted in very few changes in the actual legislation.
careful process of presentation and discussion was designed to identify
Thirty-three members of Congress wrote President Carter warning him
and defuse any last minute political problems that might arise.
against making any changes in the implementing legislation. Another
Only one serious political problem arose. The code on government
congressional letter, signed by fewer, urged that he make whatever
procurement as originally negotiated would have opened federal gov-
changes were necessary to maintain a liberal trade policy.
ernment procurement to competitive bidding and eliminated the pref-
The bill that ultimately was submitted to the Congress by President
erence toward minority-owned businesses. When members of the House
Carter on June 19 contained minor changes from the bill that Congress
22
Richard R. Rivers
23
and the executive branch had agreed upon. It was immediately introduced
Commentary: On Trade
in both the House and Senate and 34 days later was adopted by both
Robert S. Strauss
bodies by overwhelming margins. The speed of the U.S. implementation
process and the precision with which it faithfully implemented the
international agreements astonished U.S. trading partners, particularly
I offer a somewhat different perspective on the Trade Act of 1979
officials of The European Communities. Passage of the legislation was
than does Richard Rivers. While his chapter is dispassionate and objective,
front-page news in all the capitals of the world but one: Washington,
rightly focusing on structure and organization, I will examine the
D.C. The passage of the Trade Agreements Act of 1979, probably the
process-how the negotiations were carried on during my term as special
most significant trade legislation in U.S. history, received only slight
trade representative (STR) from 1977-1979. The manner in which the
mention in the back pages of the Washington Post.7 The event had
structure was used to achieve a successful outcome of the multilateral
become an anticlimax to the process.
trade negotiations was as important as the nature of the structure, and
the operation was as much political as technical.
Knowing very little about the intricate trade matters that would be
Notes
subject to negotiation, I was uncertain whether or not to accept President
Carter's offer of the STR position. Nevertheless, the special trade
1. 3 International Lawyer 464 (1969).
2. Commission on International Trade and Investment Policy, United States
representative was one of the few positions in the new administration
International Economic Policy in an Interdependent World, A Report to the President
in which I had any interest, because it offered the opportunity to conduct
(Washington, D.C.: USGPO July 1971), 22.
negotiations, it was free of bureaucracy, and it was outside of the
3. It is interesting to speculate on what would have been the fate of the
departmental chain of command.
Tokyo Round agreements had the Congress enacted the House version containing
I was convinced to accept the position when Senator Russell Long
a one-House legislative veto, in light of the Supreme Court's decision in
(D-La.), chairman of the Senate Finance Committee-whom President
Immigration and Naturalization Service v. Chadha et al., 103 Sup. Ct. 2764 (1983);
Carter had informed of my hesitancy-called me to say both he and
see also, Consumers Energy Council of America v. Federal Energy Regulatory
Senator Robert Dole (R-Kans.), ranking Republican member of the Finance
Commission (FERC), 673 F.2d 425 (D.C. Cir. 1982), and Consumers Union of the
Committee, agreed that I was in their view the person most likely to
United States, Inc. v. Federal Trade Commission (FTC), 691 F.2d 575 (D.C. Cir.
engineer a successful trade agreement that Congress would accept. Senator
1982), aff'd per curiam sub nom. Process Gas Consumers Group v. Consumers
Long said that he and Senator Dole strongly urged me to accept the
Energy Council of America, 103 Sup. Ct. 3556 (1983).
4. Ultimately, the negotiation of the Safeguards Code could not be concluded
position.
during the Tokyo Round, and the code fell out of the final legislative package.
Assured of the bipartisan backing and support of the Senate Finance
5. The readjustment was that the National Aeronautics and Space Admin-
Committee, I told President Carter of my willingness to become the
istration procurement was made subject to the provisions of the code and
STR. The Senate Finance Committee had a vested interest in the
therefore made available to foreign bidders.
negotiations process, and its seal of approval endowed the STR with a
6. The same procedure is traditionally followed in the drafting of amendments
certain amount of leverage. I had enough experience to know how to
to the Internal Revenue Code.
use this leverage to good advantage and to know when to and when
7. In contrast, the conclusion in 1967 of the Kennedy Round of trade
not to use it. The political muscle, visibility, and credibility that only
negotiations-basically a tariff-cutting exercise-had been the occasion for an
Congress could provide was more important than that given by the
eight-column banner headline in the New York Times. Annoyed by the lack of
White House.
press coverage of the enactment of the Trade Agreements Act of 1979, President
Although congressional support was essential to the STR, the relative
Carter wrote an unpublished letter of complaint to the editor of the Washington
stature of the position within the administration was also critical. The
Post.
Robert S. Strauss is a partner in the law firm of Akin, Gump, Strauss, Hauer & Feld.
He was chairman of the Democratic National Committee (1973-1976), U.S. special trade
representative (1977-1981), President Carter's personal representative to the Middle East
peace negotiations, and chairman of the Carter-Mondale Reelection Committee.
IS
DUTIES
CUSTOMS DUTIES
19 § 2211
HISTORICAL AND STATUTORY NOTES
the Senate to
1994 Amendments
Transfer of Functions
under section
Subsec.
(a).
Pub.L.
108-465,
Any reference in any provision of law enacted
this section
§ 261(d)(1)(A)(iiD, struck out "or section 1803(e)
before Jan. 4, 1995, to a function, duty, or au-
of this title," after "2473(a) or (b),".
ith respect to
thority of the Clerk of the House of Represents-
1990 Amendment
tives treated as referring, with respect to that
Subsec. (b). Pub.L. 101-382, struck out provi-
function, duty, or authority, to the officer of the
sions referring to section 2487(c)(8) of this title.
House of Representatives exercising that fune-
tion, duty, or authority, as determined by the
int resolution
Effective Date of 1994 Amendments
Committee on House Oversight of the House of
mendments in
Amendment by section 261(d)(1)(A)(HD of
Representatives, see section 2(1) of Pub.L.
table motions
Pub.L. 108-465 effective Jan. 1, 1995, see section
104-14, set out as a note preceding section 21 of
qually divided
261(d)(2) of Pub.L. 108-465, set out as a note
Title 2, The Congress.
ader or their
under section 1815 of this title.
ference report
Effective Date of 1990 Amendment
Legislative History
by, the mover
Amendment by Pub.L. 101-882 effective Aug.
For legislative history and purpose of Pub.L.
20, 1990, except as otherwise provided for, see
101-382, see 1990 U.S. Code Cong. and Adm.
section 182(d) of Pub.L. 101-382, set out as a
News, p. 928. See, also, Pub.L. 108-465, 1994
time on each
note under section 2432 of this title.
U.S. Code Cong. and Adm. News, p. 8773.
and controlled
designee. No
CROSS REFERENCES
is a germane
Review of participation in the WTO and Con-
gressional disapproval, see 19 USCA $ 3535.
6)
PART 6-CONGRESSIONAL LIAISON AND REPORTS
respect-to clause
r mbsec. (a)(2) of
§ 2211. Congressional advisers for trade policy and negotiations
132(a)(5), sub-
(a) Selection
absec. (a) of this
(1) At the beginning of each regular session of Congress, the Speaker of the House of
to subsec. (a)(1)
Representatives, upon the recommendation of the chairman of the Committee on Ways
and Means, shall select 5 members (not more than 8 of whom are members of the same
132(a)(6), add-
political party) of such committee, and the President pro tempore of the Senate, upon
the recommendation of the chairman of the Committee on Finance, shall select 5
ment
members (not more than 3 of whom are members of the same political party) of such
2 effective Aug.
committee, who shall be designated congressional advisers on trade policy and negotia-
provided for, see
tions. They shall provide advice on the development of trade policy and priorities for
2, set out as a
the implementation thereof. They shall also be accredited by the United States Trade
the
Representative on behalf of the President as official advisers to the United States
delegations to international conferences, meetings, and negotiating sessions relating to
trade agreements.
pose of Pub.L.
Cong. and Adm.
(2)(A) In addition to the advisers designated under paragraph (1) from the Commit-
tee on Ways and Means and the Committee on Finance-
(i) the Speaker of the House may select additional members of the House, for
designation as congressional advisers regarding specific trade policy matters or
negotiations, from any other committee of the House or joint committee of
Congress that has jurisdiction over legislation likely to be affected by such matters
or negotiations; and
)of this title, a
document shall
(ii) the President pro tempore of the Senate may select additional members of
relivered to the
the Senate, for designation as congressional advisers regarding specific trade policy
matters or negotiations, from any other committee of the Senate or joint committee
and to the
of Congress that has jurisdiction over legislation likely to be affected by such
matters or negotiations.
Members of the House and Senate selected as congressional advisers under this
subparagraph shall be accredited by the United States Trade Representative.
period referred
(B) Before designating any member under subparagraph (A), the Speaker or the
President pro tempore shall consult with-
(i) the chairman and ranking member of the Committee on Ways and Means or
the Committee on Finance, as appropriate; and
103-465, Title
(ii) the chairman and ranking minority member of the committee from which the
member will be selected.
97
19 § 2211
CUSTOMS DUTIES
CUS
(C) Not more than 3 members (not more than 2 of whom are members of the same
the li
political party) may be selected under this paragraph as advisers from any committee of
this t
Congress.
agree
(b) Briefing
(b) S
(1) The United States Trade Representative shall keep each official adviser designat-
The
ed under subsection (a)(1) of this section currently informed on matters affecting the
inform
trade policy of the United States and, with respect to possible agreements, negotiating
sectic
objectives, the status of neg Lations in progress, and the nature of any changes in
Resic
domestic law or the administration thereof which may be recommended to Congress to
(As ar
carry out any trade agreement or any requirement of, amendment to, or recommenda-
tion under, such agreement.
(2) The United States Trade Representative shall keep each official adviser designat-
1988
ed under subsection (a)(2) of this section currently informed regarding the trade policy
Sub
matters and negotiations with respect to which the adviser is designated.
struck
40
ing "e
(3)(A) The chairmen of the Committee on Ways and Means and the Committee on
section
Finance may designate members (in addition to the official advisers under subsection
title".
(a)(1) of this section) and staff members of their respective committees who shall have
access to the information provided to official advisers under paragraph (1).
§ 221
(B) The Chairman of any committee of the House or Senate or any joint committee of
Congress from which official advisers are selected under subsection (a)(2) of this section
(a) A
may designate other members of such committee, and staff members of such committee,
(1)
who shall have access to the information provided to official advisers under paragraph
later
(2).
1
(c) Committee consultation
The United States Trade Representative shall consult on a continuing basis with the
Committee on Ways and Means of the House of Representatives, the Committee on
S
Finance of the Senate, and the other appropriate committees of the House and Senate
on the development, implementation, and administration of overall trade policy of the
(2)
United States. Such consultations shall include, but are not limited to, the following
(1)(A
elements of such policy:
(1) The principal multilateral and bilateral negotiating objectives and the prog-
ress being made toward their achievement.
C
(2) The implementation, administration, and effectiveness of recently concluded
multilateral and bilateral trade agreements and resolution of trade disputes.
(3) The actions taken, and proposed to be taken, under the trade laws of the
United States and the effectiveness, or anticipated effectiveness, of such actions in
achieving trade policy objectives.
S
(4) The important developments and issues in other areas of trade for which
there must be developed proper policy response.
When necessary, meetings shall be held with each Committee in executive session to
review matters under negotiation.
(As amended Pub.L. 100-418, Title I, $ 1632, Aug. 23, 1988, 102 Stat. 1269.)
a
did
HISTORICAL AND STATUTORY NOTES
official advisers and added provisions requiring
happen
1988 Amendment
consultation with Congressional committees.
Pub.L. 100-418, § 1632, substituted provisions
relating to Congressional advisers for trade poli-
Legislative History
a
cy and negotiations for similar provisions which
For legislative history and purpose of PubL
related to Congressional delegates to negotia-
100-418, see 1988 U.S.Code Cong. and Adm.
tions. expanded provisions relating to briefing of
News, p. 1547.
a
§ 2212. Transmission of agreements to Congress
(a) Submission of copy and reasons
(3)(
As soon as practicable after a trade agreement entered into under section 2133 or
in whi
2134 of this title or under section 2902 of this title has entered into force with respect to
the United States, the President shall, if he has not previously done 80, transmit a copy
of such trade agreement to each House of the Congress together with a statement, in
a.
98
19 § 2194
TRADE ACT OF 1974
Ch. 12
the House is not in session and to the Secretary of the Senate if the
Senate is not in session.
(b) For purposes of sections 2253(c), 2437(c) (2), and 2437 (c) (3)
of this title, the 90-day period referred to in such sections shall be
computed by excluding-
(1) the days on which either House is not in session because
of an adjournemnt of more than 3 days to a day certain or an
adjourmment of the Congress sine die, and
(2) any Saturday and Sunday, not excluded under paragraph
(1), when either House is not in session.
Pub.L. 93-618, Title I, § 154, Jan. 3, 1975, 88 Stat. 2008; Pub.L. 96-
39, Title IX, § 902(a) (2), July 26, 1979, 93 Stat. 300.
Historical Note
1979 Amendment. Subsec. (a). Pub.L. 96-39, set out as a note under section
96-39 struck out reference to section 2412 2411 of this title.
(a) of this title.
Legislative History. For legislative
Subsec. (b). Pub.L. 96-39 struck out
history and purpose of Pub.L. 93-618, see
reference to section 2412(b) of this title.
1974 U.S.Code Cong. and Adm.News, p.
7186. See, also, Pub.L. 96-39, 1979 U.S.
Effective Date of 1979 Amendment.
Code Cong. and Adm.News, p. 381.
Amendment by Pub.L. 96-39 effective
July 26, 1979, see section 903 of Pub.L.
Library References
United States 18.
C.J.S. United States % 21, 23.
PART 6-CONGRESSIONAL LIAISON AND REPORTS
(
§ 2211.
Congressional delegates to negotiations
t
S
(a) At the beginning of each regular session of Congress, the
Speaker of the House of Representatives, upon the recommendation
of the chairman of the Committee on Ways and Means, shall select
five members (not more than three of whom are members of the
same political party) of such committee, and the President pro tem-
pore of the Senate, upon the recommendation of the chairman of the
Committee on Finance, shall select five members (not more than
S
three of whom are members of the same political party) of such
(
committee, who shall be accredited by the President as official ad-
visers to the United States delegations to international conferences,
meetings, and negotiations sessions relating to trade agreements.
(b) (1) The United States Trade Representative shall keep each
official adviser currently informed on United States negotiating
objectives, the status of negotiations in progress, and the nature of
any changes in domestic law or the administration thereof which
may be recommended to Congress to carry out any trade agreement
or any requirement of, amendment to, or recommendation under,
such agreement.
168
Ch. 12
Ch. 12 NEGOTIATING & OTHER AUTHORITY 19 § 2212
ary of the Senate if the
(2) The chairmen of the Committee on Ways and Means and the
Committee on Finance may designate members (in addition to the
(c) (2), and 2437 (3)
official advisors under subsection (a) of this section) and staff
1 such sections shall be
members of their respective committees who shall have access to the
information provided to official advisers under paragraph (1).
in
not in session because
Pub.L. 93-618, Title I, § 161, Jan. 3, 1975, 88 Stat. 2008; Pub.L. 96-
to a day certain or an
39, § 3(e), July 26, 1979, 93 Stat. 150; 1979 Reorg. No. 3, §
1
1(b) (1), eff. Jan. 2, 1980, 44 F.R. 69273, 93 Stat. 1831.
cluded under paragraph
Historical Note
Stat. 2008; Pub.L. 96-
1979 Amendment. Subsec. (b) (1). Pub.
F.R. 69273, 93 Stat. 1381, eff. Jan. 2, 1980,
L. 96-39 substituted "trade agreement or
as provided by section 1-107(a) of Ex.
300.
any requirement of, amendment to, or
Ord.No.12188, Jan. 2, 1980, 45 F.R. 993, set
recommendation under, such agreement"
out as notes under section 2171 of this ti-
for "trade agreement".
tle.
ut as a note under section
Change of Name. "United States Trade
Legislative History. For legislative
Representative" was substituted for
title.
history and purpose of Pub.L. 93-618, see
"Special Representative for Trade Negoti-
1974 U.S.Code Cong. and Adm.News, p.
History. For legislative
ations" in subsec. (b) (1), pursuant to
7186. See, also, Pub.L. 96-39, 1979 U.S.
purpose of Pub.L. 93-618, see
Reorg. Plan No. 3 of 1979, I 1(b) (1), 44 Code Cong. and Adm.News, p. 381.
ie Cong. and Adm.News, p.
also, Pub.L. 96-39, 1979 U.S.
and News, p. 381.
Library References
United States (23(5).
C.J.S. United States I 26.
§ 2212.
Transmission of agreements to Congress
ted States §§ 21, 23.
(a) As soon as practicable after a trade agreement entered into
under part 1 of this subchapter or section 2133 or 2134 of this title
AND REPORTS
has entered into force with respect to the United States, the Presi-
dent shall, if he has not previously done so, transmit a copy of such
egotiations
trade agreement to each House of the Congress together with a
ssion of Congress, the
statement, in the light of the advice of the International Trade Com-
on the recommendation
mission under section 2151 (b) of this title, if any, and of other rele-
and Means, shall select
vant considerations, of his reasons for entering into the agreement.
m are members of the
(b) The President shall transmit to each Member of the Congress
the President pro tem-
a summary of the information required to be transmitted to each
of the chairman of the
House under subsection (a) of this section. For purposes of this
embers (not more than
subsection, the term "Member" includes any Delegate or Resident
olitical party) of such
Commissioner.
resident as official ad-
Pub.L. 93-618, Title I, § 162, Jan. 3, 1975, 88 Stat. 2008.
ernational conferences,
g to trade agreements.
Historical Note
tative shall keep each
Legislative History. For legislative 1974 U.S.Code Cong. and Adm.News, p.
ted States negotiating
history and purpose of Pub.L. 93-618, see 7186.
ress, and the nature of
Library References
stration thereof which
ut any trade agreement
United States 26.
C.J.S. United States = 27, 28.
recommendation under,
169
what is shateay tn
add-ond?
of Understanding
1028
- How Memsers to for mally veryanete
n "bona fide motor-vehicle manufacturer"
1 who, upon application to the Secretary of
determined by the Secretary to have pro-
r than 15 complete motor vehicles in the
during the previous 12 months, and to have
ity in the United States to produce 10 or
motor vehicles per 40-hour week. The Sec-
Chapter 14: ORGANIZATION OF TRADE POLICY
erce shall maintain, and publish from time
FUNCTIONS
Federal Register, a list of the names and ad-
A. CONGRESS
fide motor-vehicle manufacturers.
ian article accorded the status of original
1. Congressional Advisers
ment is not so used in the manufacture in
of motor vehicles, such Canadian article or
Section 161 of the Trade Act of 1974, as amended
covered from the importer or other person
article from its intended use as original
[19 U.S.C. 2211; P.L. 93-618, as amended by P.L. 96-39 and P.L. 100-418]
ment) shall be subject to forfeiture, unless
SEC. 161. CONGRESSIONAL ADVISERS FOR TRADE POLICY AND
iversion of the Canadian article the United
NEGOTIATIONS.
vice is notified in writing, and, pursuant to
(a) SELECTION.-
with the Service-
(1) At the beginning of each regular session of Congress, the
dian article is, under customs supervision,
Speaker of the House of Representatives, upon the rec-
ported, or
ommendation of the chairman of the Committee on Ways and
aid to the United States Government in an
Means, shall select 5 members (not more than 3 of whom are
o the duty which would have been payable
members of the same political party) of such committee, and
entry if the Canadian article had not been
the President pro tempore of the Senate, upon the rec-
nal motor-vehicle equipment.
ommendation of the chairman of the Committee on Finance,
Daschle
shall select 5 members (not more than 3 of whom are members
of the same political party) of such committee, who shall be
- consultation mtas
designated congressional advisers on trade policy and negotia-
- sen next wlc
tions. They shall provide advice on the development of trade
policy and priorities for the implementation thereof. They shall
also be accredited by the United States Trade Representative
- Ns pone to request
on behalf of the President as official advisers to the United
- 1958 wbar Ac L proviso on
States delegations to international conferences, meetings, and
negotiating sessions relating to trade agreements.
(2)(A) In addition to the advisers designated under para-
- unsilatural Adm
graph (1) from the Committee on Ways and Means and the
Committee on Finance-
hose agencla
(i) the Speaker of the House may select additional mem-
bers of the House, for designation as congressional advis-
- 220 inspection
ers regarding specific trade policy matters or negotiations,
from any other committee of the House or joint committee
of Congress that has jurisdiction over legislation likely to
wh of Recess OCL
be affected by such matters or negotiations; and
(ii) the President pro tempore of the Senate may select
additional members of the Senate, for designation as con-
gressional advisers regarding specific trade policy matters
- -POTUS TODO speech
or negotiations, from any other committee of the Senate or
joint committee of Congress that has jurisdiction over leg-
islation likely to be affected by such matters or negotia-
Presshrue -wsell.
tions.
Members of the House and Senate selected as congressional
Laser Letter. Dews
advisers under this subparagraph shall be accredited by the
United States Trade Representative.
- Redeaft sie: fatethersday
See. wriport
(1029)
- ways theaus
whip Group
ways means Heaving
- Roth
Scuide Finance Reps
- Pres. mtas.
1030
1031
(B) Before designating any member under subparagraphic
trade for which there must be developed proper policy re-
(4) The important developments and issues in other areas of
the Speaker or the President pro tempore shall consult with
(i) the chairman and ranking member of the Committ
on Ways and Means or the Committee on Finance, as à
When sponse. necessary, meetings shall be held with each Committee in
propriate; and
executive session to review matters under negotiation.
(ii) the chairman and ranking minority member of the
committee from which the member will be selected.
2. Reports to Congress
(C) Not more than 3 members (not more than 2 of whom are
members of the same political party) may be selected under
Sections 162 and 163 of the Trade Act of 1974, as amended
(b) BRIEFING.-
this paragraph as advisers from any committee of Congress.
[19 U.S.C. 2212 and 2213; P.L. 93-618, 647] as amended by P.L. 100-418 and P.L. 100-
(1) The United States Trade Representative shall keep each
official adviser designated under subsection (a)(1) currently in-
SEC. 162. TRANSMISSION OF AGREEMENTS TO CONGRESS.
formed on matters affecting the trade policy of the United
(a) section 123 or 124 or under section 1102 of the with
As soon as practicable, after a trade agreement entered Omnibus into
States and, with respect to possible agreements, negotiating
objectives, the status of negotiations in progress, and the na-
Trade under and Competitiveness Act of 1988 has entered into force not
ture of any changes in domestic law or the administration
thereof which may be recommended to Congress to carry out
respect done so, transmit a copy of such trade agreement of
to the United States, the President shall, if he has to each pre-
any trade agreement or any requirement of, amendment to, or
viously of the Congress together with a statement, in the light section
recommendation under, such agreement.
House advice of the International Trade Commission under
(2) The United States Trade Representative shall keep each
the 131(b), if any, and of other relevent considerations, of his reasons
official adviser designated under subsection (a)(2) currently in-
for entering into the agreement.
formed regarding the trade policy matters and negotiations
with respect to which the adviser is designated.
(b) of the information required to be transmitted to the
The President shall transmit to each Member of the Congress each
(3)(A) The chairmen of the Committee on Ways and Means
a summary under subsection (a). For purposes of this subsection,
and the Committee on Finance may designate members (in ad-
term House "Member" includes any Delegate or Resident Commissioner.
dition to the official advisers under subsection (a)(1)) and staff
SEC. 163. REPORTS.
members of their respective committees who shall have access
(a) ANNUAL REPORT ON TRADE AGREEMENTS PROGRAM AND
graph (1).
to the information provided to official advisers under para-
NATIONAL TRADE POLICY AGENDA.-
(1) The President shall submit to the Congress during each re-
(B) The Chairman of any committee of the House or Senate
calendar year (but not later than March 1 of that year) a
or any joint committee of Congress from which official advisers
are selected under subsection (a)(2) may designate other mem-
port on-
(A) the operation of the trade agreements program, and to
bers of such committee, and staff members of such committee,
the provision of import relief and adjustment assistance
who shall have access to the information provided to official
workers and firms, under this Act during the preceding
advisers under paragraph (2).
calendar year; and
(c) COMMITTEE CONSULTATION.-The United States Trade Rep-
(B) the national trade policy agenda for the year in
resentative shall consult on a continuing basis with the Committee
which the report is submitted.
on Ways and Means of the House of Representatives, the Commit-
(2) The report shall include, with respect to the matters re-
tee on Finance of the Senate, and the other appropriate committees
ferred to in paragraph (1)(A), information regarding-
of the House and Senate on the development, implementation, and
(A) new trade negotiations;
administration of overall trade policy of the United States. Such
(B) changes made in duties and nontariff barriers and
consultations shall include, but are not limited to, the following ele-
other distortions of trade of the United States;
ments of such policy:
(C) reciprocal concessions obtained;
(1) The principal multilateral and bilateral negotiating objec-
tives and the progress being made toward their achievement.
ration therein of actions taken for import relief and com-
(D) changes in trade agreements (including the incorpo-
(2) The implementation, administration, and effectiveness of
pensation provided therefor);
recently concluded multilateral and bilateral trade agreements
and resolution of trade disputes.
treatment by the United States with respect to the prod-
(E) the extension or withdrawal of nondiscriminatory
(3) The actions taken, and proposed to be taken, under the
ucts of foreign countries;
trade laws of the United States and the effectiveness, or antici-
(F) the extension, modification, withdrawal, suspension, devel-
objectives. pated effectiveness, of such actions in achieving trade policy
or limitation of preferential treatment to exports of
oping countries;
08/27/97 WED 19:34 FAX
002
FAST TRACK: HISTORICAL BACKGROUND
Constitutional Authority
The Constitution gives Congress exclusive authority to set tariffs and enact other
legislation governing international trade.
The President negotiates international agreements under his own Constitutional authority.
If the President negotiates a trade agreement that calls for a change in tariffs or in other
domestic laws, the President must submit the trade agreement to the Congress -- or have
Congress' advance approval of such changes.
Tariff Proclamation Authority
Tariffs were the major source of revenue for the federal government for well over 100
years. Congress enacted a number of across-the-board tariff changes -- the last of which
was the increases of the 1930 Smoot-Hawley Tariff Act.
During the Roosevelt Administration, Congress began moving away from protectionism
four years later.
Congress gave the President the authority in 1934 to "proclaim" up to 50 percent
reductions in U.S. tariffs in return for "reciprocal" commitments from other countries --
without further action by Congress. This was the original "fast track" -- although it was
not called that then.
Proclamation authority was to last for three years, but was renewed over the following six
decades.
--
By 1945, Cordell Hull had negotiated tariff reductions with 27 countries --
lowering U.S. tariffs by an average 44% on covered products.
The President used his proclamation authority to carry out U.S. tariff
commitments under the first world-wide trade agreement, GATT, in 1947.
The President used his 50 percent tariff cutting powers again to implement U.S.
tariff commitments under several subsequent GATT negotiating rounds --
including the "Kennedy Round" cuts, completed in 1967.
08/27/97 WED 19:34 FAX
003
Non-tariff Barriers
Once the early GATT rounds were completed, tariffs had dropped in the United States
and other developed countries to the point where other -- non-tariff trade barriers
became equally or more important. These included product design standards and customs
rules designed to exclude foreign goods. and other Savarees man what - access to
Although the President had authority to lower tariffs further, he did not have the power to
change federal law in order to put "non-tariff" agreements into effect.
Genesis of Fast Track
7
Congress rejected two important agreements concluded by the Johnson Administration to
close the Kennedy Round (a GATT "dumping" code and a change in U.S. tariff appraisal
methods) in 1967. The rejection was a major embarrassment for the United States, which
had sought the two agreements.
The Nixon Administration recognized that the United States could not negotiate and carry
out future market-opening deals unless the President and the Congress worked together.
President Nixon asked the Congress for proclamation authority to make changes in U.S.
law necessary to implement "non-tariff barrier" agreements - subject to a possible
Congressional veto.
The House went along, but the Finance Committee objected - Senator Talmadge, in
particular, wanted to retain the power to approve trade agreements, not just veto their
implementation.
The compromise was a "fast track" procedure, inserted in the 1974 trade act, for obtaining
Congressional approval on an "up or down" vote within a limited period. (The idea was
drawn from a procedure common to budget resolutions.)
The procedures required the Administration to consult closely with the Congress both
before and during negotiations. They were crafted with the next GATT negotiating round
the Tokyo Round - in mind.
Agreement on Drafting Implementing Bills
Towards the close of the Tokyo Round, the Ways and Means and Finance committees
which had principal jurisdiction over trade bills insisted on further guarantees from the
Carter Administration. They insisted that the implementing legislation for the Round
would be drawn up collaboratively with the Congress, in advance of actually submitting a
bill, through pre-hearings and pre-markups.
That format was used repeatedly thereafter. The pre-hearing and -markup procedure
(largely recreates the legislative process in advance of the bill's submission.
murois regular
08/27/97 WED 19:35 FAX
004
Congress overwhelmingly approved the Tokyo Round legislation, together with a partial
extension of fast track through 1988.
Inclusion of FTA Negotiations
In 1984, Congress wrote a specific three-year fast-track bill for free-trade agreements
with individual countries Which the Reagan Administration used to negotiate and
obtain Congressional approval for FTAs with Israel (1985) and Canada (1988).
The Uruguay Round and NAFTA
In 1988, Congress enacted the first "omnibus" trade act since Smoot-Hawley, which it
used to extend fast-track for both FTA's and the GATT "Uruguay Round" until March
1991.
The Uruguay Round negotiations broke down in Brussels in December 1990, by which
time the NAFTA negotiations had gotten under way.
The 1988 statute allowed the Administration to request a two-year extension of fast track
-- unless either House disapproved
The Bush Administration waged a fierce and
successful fight to overcome opposition to the extension.
During the debate, the Bush Administration attempted to address questions that had been
raised by spelling out in advance its NAFTA negotiating objectives and implementing
proposals. An Administration statement to the Congress also stressed Mexico's labor and
environment efforts.
The House overwhelmingly approved a resolution endorsing the Bush Administration's
NAFTA labor and environment objectives.
The NAFTA was signed by President Bush in December 1992 and approved by the
Congress under fast track procedures in the 1993. At the same time, Congress provided
for the implementation of supplemental agreements on labor and the environment.
Congress extended fast track procedures for a final time in 1993 for the Uruguay Round
agreement. That agreement, which replaced the GATT with the World Trade
Organization, was approved by large Congressional margins in late 1994.
Key Fast Track Components
Under fast track, Congress maintains substantial control and oversight over our most
important trade negotiations. In return, Congress commits to refrain from re-negotiating
agreements that the President brings back for consideration.
Under fast track rules, Congress has exerted authority in a variety of ways, including by:
08/27/97 WED 19:35 FAX
005
requiring the President to meet extensive consultation, reporting and notification
requirements in connection with fast track trade negotiations;
creating a special, rapid procedure for Congress to revdee retract fast track if the
President fails to consult adequately;
empowering the Ways and Means and Finance committees to veto particular free-
trade negotiations in advance;
providing that either House may disapprove the extension of fast-track
procedures;
insisting on Congressional participation in drafting the implementing bill through
the use of pre-hearings and -markups;
requiring the President to spell out precisely how he will use his existing
regulatory authority to carry out fast track trade agreements; and
reserving the right to vote an agreement down if it is unacceptable.
Other key components of fast track have been:
a commitment by the Congress to vote "yes or no" -- with no amendments -- on
the implementing bill within several months after it is introduced. As a practical
matter, Congress has typically taken only a few weeks because issues involving
the agreement are worked out during the lengthy pre-hearing and -markup period
that precedes submission of the bill.
a provision limiting the types of provisions that can be included in implementing
legislation to those "necessary or appropriate" to carry out the agreement. This
requirement has helped keep non-trade matters out of fast track legislation, but
provides enough flexibility to help ensure passage.
a provision in the 1988 version of fast track allowing for an extension of fast track
if the President meets certain reporting requirements and if the Congress does not
disapprove.
Uses of Fast Track
Since 1974, five significant trade agreements have been brought to the Congress under
"fast track" procedures.
These are the Tokyo and Uruguay Round agreements, our bilateral free-trade
08/27/97 WED 19:36 FAX
006
arrangements with Israel and Canada, and the NAFTA.
Future uses of fast track are likely to include multilateral agreements, in particular the
WTO built-in agenda, which includes global negotiations on lowering barriers to trade in
agricultural products or in other sectors where the United States is the world's leader;
sectoral agreements, like the recently concluded ITA; and the long-delayed expand free-trade
agreement with Chile.
continuous from Jan 1915
to April 1994 WTR 4 mil
Extension of Fast Track Trade Negotiating Authority
What Is Fast Track?
The short answer is that it is an expedited procedure for Congressional
consideration of trade agreements. The two essential features of any fast track
authority are: (1) a vote on implementing legislation within a fixed period of
time, and (2) an up or down vote, with no amendments.
Trade Negotiating Authority
The Constitution gives Congress exclusive authority to set tariffs and
enact other legislation governing international trade. The President has the
Constitutional authority to negotiate international agreements. If the President
negotiates a trade agreement that requires changes in U.S. tariffs or in other
domestic laws, that trade agreement's implementing legislation must be
submitted to Congress--or the President must have Congress' advance
approval of such changes. Tariff cutting authority is one instance where
Congress has often granted the President prior approval and such authority
has been included in all of the recent grants of fast track authority. For
changes implementing other provisions of a trade agreement, fast track
provides for a time certain vote and that vote is on the total package, with no
amendments.
Historical Background to Fast Track
&
For over 60 years, the-Congress and the President have recognized that
the negotiation and implementation of trade agreements require special
cooperation. In the aftermath of the record-high rates of the Smoot-Hawley
Tariff Act of 1930 and the Depression they helped create, both the Congress
and the President recognized that only by working closely together could trade
barriers be torn down and markets opened to U.S. goods and services. This
new attitude was first reflected in the Reciprocal Trade Agreements Act of
1934, giving the President authority to both negotiate tariff cutting agreements
and to implement them without further Congressional approval.
In recent years, as tariffs became less of an obstacle to trade and many
of our trading partners sought to protect their domestic markets by erecting
non-tariff barriers, the scope of trade negotiations broadened and by
agreement between the Nixon Administration and the Congress, fast track was
created to accomodate this broader trade agenda. Specifically, it was first
embodied in the Trade Act of 1974 to deal with the Tokyo Round negotiations
called for in the GATT. Fast track procedures for approving trade
agreements have been renewed by Congress in 1979, 1984, 1988, 1991, and
most recently in 1993. As a result, Presidents have had fast track negotiating
authority continuously from January 1975 until April 1994, with a brief hiatus
for eight months in 1988.
Fast Track Is Essential to Successful Trade Negotiations
In exchange for the expedited consideration of implementing legislation,
Congress has established a number of procedural safeguards that guarantee it
a meaningful role both before and during the negotiating process and, equally
important, in determing how to implement trade agreements. Requests for
fast track have always included exstensive notification and consultation
requirements, both for Congress itself and for private sector advisory
committees. In every trade agreement negotiated under fast track, Congress
has been an active participant in identifying negotiating objectives, monitoring
the actual negotiations, and drafting implementing legislation.
To apply fast track to a trade agreement, whether sectoral, bilateral or
multilateral, the President must notify Congress in advance of his intention to
sign such an agreement. For most previous grants, the advance notice
requirement was 90 days; for the Uruguay Round, because it was such a
massive agreement, the notice requirement was set at 120 days. Even before
the President signals his intention to enter into an agreement, the private sector
advisory committees are required to report to both Congress and the President
on their views as to whether the agreement meets U.S. negotiating objectives.
Further, for bilateral trade agreements, the Congress must be given advance
notice of the President's intent to begin negotiations. During the next 60
legislative days, either the House Ways and Means Committe or the Senate
Finance Committee can vote to deny fast track for the proposed bilateral.
Once the negotiations have been concluded and the President has signed
it, the Congress and the Administration begin a period of extensive informal
discussions on the drafting of the implementing legislation. This process,
reflecting the growing complexity of trade agreements, has involved an ever
increasing number of committees of jurisdiction and interested Members.
In addition, the President is required to spell out precisely how he intends to
use his existing regulatory authority in implementing the agreement. And, of
course, Congress retains the right to vote down an agreement if, after all of the
consultations, it still finds the package unacceptable.
Additional Congressional prerogatives include a special procedure for
revoking fast track if the President fails to meet the consultation requirements.
Finally, in recent instances where fast track authority has been granted and
extensions included, either House has retained the right to disapprove of such
extensions provided that either the House Ways and Means Committee or the
Senate Finance Committee have reported out an "extension disapproval
resolution."
Why Fast Track Is Essential To Trade Negotiations
Fast track procedures reflect an Executive-Congressional understanding
that trade agreements to open markets and tear down tariff barriers are the
product of difficult negotiations and that permitting an entire agreement to be
subject to individual amendments means unravelling the agreement. In order
to determine whether any trade agreement is in the national interest, it
requires looking at the total package in its entirety. Without fast track, it is
virtually impossible to see how any negotiation could produce a final offer
from our trading partners if each provision in the package was subject to
amendment.
By granting Presidents fast track, Congress has empowered American
Presidents with the same bargaining power and negotiating authority
possessed by our trading partners. That is, the ability to ensure that the
agreement SO painstakingly negotiated would be the agreement voted on.
Without fast track, the President cannot make such an assurance and without
it, few would be willing to enter into a negotiation and even fewer would be
willing to negotiate the tough concessions necessary. No trading nation would
ever reveal its final, best offer knowing that the United States could
unilaterally reopen the agreement.
The United States Trade Agenda: What Is Fast Track For
After consultations with Congress, the President will set out the nation's
trade agenda for the next few years. The absence of large-scale negotiations
like the Tokyo and Uruguay Rounds has mistakenly led some to conclude that
not having fast track is not a problem for the United States. That is just as
wrong a view as the idea that this request for fast track is only about extending
NAFTA to Chile.
The President has identified three main areas in which negotiations
would greatly benefit the United States. First, there is the "built-in" agenda of
the WTO, which calls for negotiations on government procurement in 1997;
intellectual property in 1998; agriculture in 1999; and trade in services in
2000. In each of these areas, the United States is the most competitive nation
in the world and, as a result, we stand to benefit the most from actively
participating in writing the rules of trade.
The second part of the President's proposed agenda involves building
on the success of the Information Technology Agreement(ITA). This $5 billion
tariff cut on products for which the United States is the world's leading
producer was achieved by the use of residual tariff cutting authority from a
previous grant of fast track. We have identified eight additional sectors for
future negotiations: ITA 2, chemicals, automotive, oilseeds, energy equipment
and services, environmental technology and services, medical equipment and
services, and wood and paper products. Other APEC members have submitted
their "wish lists" and it appears there is sufficient overlapping support for
many of the U.S. suggestions. Without fast track, it is very unlikely that this
process will go forward.
The third area the President hopes to address is moving forward in both
the Asia Pacific Economic Cooperation Forum(APEC) toward the goal of free
trade by the year 2010 and with a Free Trade Agreement for the
Americas(FTAA)by the year 2005. In both regions, economic growth rates are
among the highest in the world and barriers to U.S. exports remain high. As a
result, tariff reductions and greater market access will have a very positive
effect on our exports. Without the active participation of the United States,
both of these processes will slow considerably-and without fast track we
cannot participate actively.
The President and many Members of Congress have indicated that
negotiating a trade agreement with Chile is a critical step in continuing the
move to trade liberalization in the Hemisphere. The Canadians have already
concluded a bilateral treaty with Chile and the result, for our exports, is that
we face an across-the-board 11% tariff disadvantage.
It is important to remember that non-participation by the United States
in global trade negotiations does not mean that our competitors are going to
call a halt to their efforts to gain market access and preferential tariff
treatment. On the contrary, they are very active in advancing their own
agendas. Since 1992, in Latin America and Asia they have concluded over 20
free trade agreements--agreements that leave us at a disadvantage.
The United States is the most competitive nation in the world. That is
why it is so advantageous for us to play a leading role in establishing both the
focus of trade negotiations and the rules. We will not have the opportunity to
do either in the absence of fast track.
Legislative History of Fast Track
-there are five major elements to fast track:
1. a specification of negotiating objectives and the types of agreements to
which fast track authority applies;
2. procedural requirements involving consultation with Congressional
committees and the private sector advisory committees during the course of
the negotiations and advance notice of intent to conclude an agreement;
3. a deadline for the conclusion of agreements authorized in order for
fast track to apply;
4.rules concerning Presidential submission of the agreement to Congress,
except that there has never been a time limit requiring transmission of the
implementing legislation, together with the draft of the proposed implementing
bill and supporting documentation as required in authorizing fast track;
5.a procedural commitment by Congress to introduce the implementing
bill on the day it is submitted and a timetable that produces a vote in both
House and Senate within 60 legislative days(90 days for implementing revenue
bills) with no amendments
-in the 1988 renewal, a "reverse fast track" provision was added permitting
Congress to terminate fast track if USTR failed to meet the statutory
consultation requirements
-the original grant was 1974; the first renewal was 1979; 1984; 1988(for
Uruguay Round and FTAs; 1991(a two year extension); 1994--the advance
notice requirement was 90 days in 1991 and increased to 120 days in 1994
-no fast track bill has made any provision for the Congressional role in
drafting the implementing bill; as a result, the non-markup routine emeerged
first with Bob Strauss
-the "necessary and appropriate" language was in the original 1974 Act
-the non markup worked exceptionally well in Tokyo Round and in Canadian
FTA as the Reagan administration made a commitment to work with Congress
in drafting the implementing bill and actively participated in the non-markups
-in NAFTA it did not work as well, probably because of time constraints as the
House vote date had been set and the target date for completing the draft was
not met
-it worked well in the Uruguay Round but by then, the private interest groups
understood it and the budget rule of paygo was applicable--as a result, the time
from the conclusion of the agreement to the conclusion of the non-markup was
increased substantially
-in NAFTA the bill was finally submitted only thirteen days before the
scheduled vote(because of bargaining for votes by means of "appropriate")
-by 1991 the degree of controversy surrounding fast track has escalated; the
two year extension provided for in 1988 had envisioned the Uruguay Round
but it now had to accomodate NAFTA
-the Kantor proposal in 1994 included Labor Standards and Trade and the
Environment as the fifth and sixth of seven enumerated Trade Negotiating
Objectives; on labor, the language paralleled the 1988 Worker Rights section
in the negotiating authority for Uruguay Round with the change being a
substitution of the phrase "internationally recognized labor standards" for
"worker rights; the specific environmental language was new but very general:
"to promote the compatibility of the rules of the international trading system
with environmental protection."
-remember, this was a Democratic Congress and a Republican Administration;
there is a big difference now with the reverse and Mickey's proposal was
greeted icily; no consultation with business and SO there was also unanimity in
opposing its inclusion
-Mickey and Archer negotiated a tentative deal in August which deleted labor
and the environment as specific negotiating objectives and agreed that the
Administration would not negotiate agreements with trade sanctions for labor
and environmental issues in the absence of bipartisan congressional support
-there was some opposition in Senate Finance to considering fast track under a
fast track procedure
-in early 1995 the Ways and Means committee wanted to start on a bill but it
did so on a strictly partisan basis; it was here for the first time that the idea of
going only with necessary surfaced and a provision was added requiring the
President to send to Congress within 60 days of entering into an agreement a
description of the changes in U.S. law required to implement; it also referred
to labor and the environment in the context of "directly related" to trade
-Republicans interpreted "directly related" to mean measures that impeded
trade as opposed to measures meant to prevent industries from the race to the
bottom; there was also an explicit prohibition against the use of fast track to
change U.S. labor and environmental laws or for agreements providing for
trade sanctions to enforce labor or environmental standards
-Mickey saw this as worse than 1994 language as did Gore, so it simply became
a dance between the Committee and the Administration
-in September, 1995, the Committee voted out its bill on a strictly party vote;
the negotiations continued after this and there is some dispute as to who
evidenced the greater degree of flexibilty; USTR never offered up a proposal
-in the early fall it appeared that a near consensus had been achieved on about
95 percent of the issues; but no work had been done in the Senate
-at this point, it all came apart; some blame Mickey's partisanship and his
agreeing to things in private with the Committee and then publicly saying "no"
-fast forward to May 1997 when Archer tried again to get to mark up by
proposing a draft outline to be used that appeared to go beyond the
1995 version; again Matsui said no, with USTR fearing it still looked like a
Republican deal; thus the Archer letter to the President
-fast track and Congressional prerogatives: provide for Congressional role in
authorizing each particular negotiation and establish statutory guidelines and
limits as to what each is about; consultation on nature of agreement and
consultation on implementing legislation but with wider committee
participation
-what agreements are authorized; the issues addressed in fast track trade
negotiations; the implementing legislation both procedurally and substantively
-the NAFTA could have been blocked through the use of the never exercised
power to stop a bilateral negotiation within the 60 day notification period; or
again when Bush sought the extension in 1991
-the result in NAFTA is that Congress never got a chance to vote on NAFTA
itself until after the agreement was negotiated and implementation was
presented
-the 1988 language was based on an existing statutory commitment about
international labor standards in the GATT; no problems in either body and
none raised by Reagan administration-but no statutory requirement that all
16 principal trade negotiating objectives be achieved
-there is, as Lugar points out, a problem with paygo and fast track; it isn't a
commitment in the context of a trade agreement that needs to be protected
-statutory negotiating deadlines should be specific to each particular
agreement, with a requirement that Congress approve, in advance, the
negotiation of specific agreements--committee approval or joint resolution
-would approval resolution be subject to fast track: provided Congress had
endorsed the broader goal; if the agreement went beyond what Congress had
agreed to then normal legislative procedure
-a possible construct: fast track for use in market-expanding trade negotiations
requiring broad consultation requirements and a legislative timetable for
implementing bills once submitted; the details for completion of agreements,
negotiating objectives etc. in each legislative proposal for specific negotiation;
reverse fast track could apply to individual negotiations
-the current Ways and Means draft: as in '95 and '97 versions fast track
implementing legislation limited to measures "necessary" w/o "appropriate"
and added a requirement that within 60 days of entering an agreement, the
President must submit to Congress a description of those changes to U.S. law
that its implemention will required; too restrictive to include their current
language requiring provisions directly related to principal negotiating
objectives; other formulations: necessary to facilitate the implementation of the
agreement; if necessary and appropriate then a requirement that President
submit a list of all those provisions not strictly necessary together with a
rationale as to why they are appropriate
-also a possible requirement that the Administration submit draft
implementing language for comment by committees of jurisdiciton prior to
formal submission of the bill
-and statutory role for non markup process in exchange for shorter timetable
for Congressional consideration