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Working Group on South Texas
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Ronald Reagan Presidential Library
Digital Library Collections
This is a PDF of a folder from our textual collections.
Collection: Roberts, John G.: Files
Folder Title: Working Group on South Texas
Box: 57
To see more digitized collections visit:
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To see all Ronald Reagan Presidential Library inventories visit:
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Contact a reference archivist at: [email protected]
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ID #
CU
WHITE HOUSE
CORRESPONDENCE TRACKING WORKSHEET
O OUTGOING
H INTERNAL
I INCOMING
Date Correspondence
Received (YY/MM/DD)
/
/
Name of Correspondent: RICHARD G. DARMAN
MI Mail Report
User Codes: (A)
(B)
(C)
Subject: Working group on South Texas
ROUTE TO:
ACTION
DISPOSITION
Tracking
Type
Completion
Action
Date
of
Date
Office/Agency
(Staff Name)
Code
YY/MM/DD
Response
Code YY/MM/DD
WHO11
ORIGINATOR
/ /
/ /
Referral Note:
WATIS
/ /
53 05 02
-
Referral Note:
/
/
/
/
-
Referral Note:
/ /
/
/
-
Referral Note:
/ /
/
/
I
Referral Note:
ACTION CODES:
DISPOSITION CODES:
A Appropriate Action
I . Info Copy Only/No Action Necessary
A - Answered
C Completed
C Comment/Recommendation
R. Direct Reply w/Copy
B - - Non-Special Referral
S Suspended
D - Draft Response
S. For Signature
F Furnish Fact Sheet
X - Interim Reply
to be used as Enclosure
FOR OUTGOING CORRESPONDENCE:
Type of Response = Initials of Signer
Code = "A"
Completion Date = Date of Outgoing
Comments:
Keep this worksheet attached to the original incoming letter.
Send all routing updates to Central Reference (Room 75, OEOB).
Always return completed correspondence record to Central Files.
Refer questions about the correspondence tracking system to Central Reference, ext. 2590.
5/81
073294CA
Document No.
WHITE HOUSE STAFFING MEMORANDUM
DATE:
April 29
ACTION/CONCURRENCE/COMMENT DUE BY: Monday, 5/2, c.o.b
WORKING GROUP ON SOUTH TEXAS
SUBJECT:
ACTION FYI
ACTION FYI
VICE PRESIDENT
GERGEN
MEESE
HARPER
BAKER
JENKINS
DEAVER
MURPHY
STOCKMAN
ROLLINS
CLARK
WHITTLESEY
DARMAN
P
SS
WILLIAMSON
DUBERSTEIN
VON DAMM
FELDSTEIN
BRADY/SPEAKES
FIELDING
ROGERS
FULLER
Remarks:
Senator Tower has called for the creation of a group to study
South Texas. Attached is a draft memorandum establishing such
a group. Please provide any thoughts or comments by Monday,
May 2nd.
Thank you.
Richard G. Darman
Assistant to the President
(x2702)
Response:
THE WHITE HOUSE
WASHINGTON
April 29, 1983
MEMORANDUM FOR SELECTED DEPARTMENTS AND AGENCIES
FROM:
CRAIG L. FULLER
SUBJECT:
Working Group on South Texas
A Working Group on South Texas is being established to review
the current economic situation in the southern region of
Texas. A wide range of problems is affecting this particular
area as a result of the current situation in Mexico.
The Working Group on South Texas will be chaired by a rep-
resentative from the Department of Commerce. Sub-cabinet
representatives from the following departments and agencies
should also serve on the Task Force: State, Treasury,
Justice, Health and Human Services, Housing and Urban Devel-
opment, Small Business Administration and the Office of
Management and Budget. Representatives from the following
White House offices will also participate: Office of the
Chief of Staff, Intergovernmental Affairs, Congressional
Affairs and the Office of Policy Development. Robert Carleson
will serve as the executive secretary for the working group.
The Working Group on South Texas should focus on the following
tasks:
--
fact finding: determine what problems do exist in
the region.
--
alternative state and local remedies: determine
what the state and local governments can do at the
present time with and without the help of the
federal government.
:
Federal options: determine what actions the
federal government should consider taking in the
South Texas area.
The Working Group on South Texas should report its recommen-
dations to this office within 45 days. Recommendations will
be staffed to the appropriate Cabinet Councils for consideration.
ARMED SERVICES
CHAIRMAN
BANKING, HOUSING, AND
URBAN AFFAIRS
United States Senate
BUDGET
WASHINGTON, D.C. 20510
April 11, 1983
The Honorable James A. Baker, III
Chief of Staff and Assistant to the
President
The White House
Washington, D.C. 20500
Dear Jim:
I am deeply concerned about the economic crisis in South Texas created primarily by
the devaluation of the peso. The lack of action by the Federal government in this
matter should be remedied as quickly as possible.
As you may already know, estimates of unemployment in the area range from 20 to
50 percent. Retail sales and wholesale trade are down 25 to 40 percent -- 60 percent
in some border communities. This sharp rise in unemployment, coupled with a fall
in business activity, has caused the tax base of these communities to erode rapidly.
It should be noted that this tax base erosion is occurring at the same time as the
affected local governmental entities are being required to shoulder the additional
burden of educating alien children in Texas public schools.
Additionally, illegal immigration is up 50 percent over last year. It is estimated that
fully one-third or more of the 2 million illegal entrants in 1983 will become permenent
residents of the United States, and, in my view, many of these will find their way to
Texas.
I agree with the Administration's assessment that an economic recovery in Mexico would
be beneficial in mitigating some of the aforementioned problems; nonetheless, South Texas
and other border areas cannot afford to wait for this economic recovery to take effect.
Indeed, officials at the Department of the Treasury indicate that Mexico will need two
to four billion dollars in additional assistance before the end of 1983 should oil prices
continue to decline. Experienced and informed individuals in the Nation's financial
circles estimate that the amount is closer to $7 billion.
In either event, because of these exacting economic pressures, private and public sector
experts foresee that there will arise even added pressure on Mexico for further peso
devaluation. This will serve only to exacerbate existing problems in South Texas and
create new ones.
Although there is considerable merit in continuing high-level negotiations regarding
Mexico's external debt, it is readily apparent to me that the acute problems of South
Texas have fallen by the wayside. I have been impressed by the well-coordinated,
government-wide Mexican rescue plan whereby the Departments of the Treasury, State
and Agriculture-acted quickly and efficiently to ward off a major crisis. Yet, to the
contrary, this same degree of coordination and commitment seems lacking in govern-
ment to dèal with the growing economic problems of South Texas.
The Honorable James A. Baker, III
April 11, 1983
Page 2
Additionally, it should be noted that the source and nature of these difficulties in
border areas are considerably broader than regional or parochial concerns. It is a
problem which has reached an international status, and, in my view, it is our
responsibility in government to act as quickly as possible to prevent further ruination
f border communities. Rebuilding efforts are required now.
[aving given this matter considerable thought, it is my view that the President should
ppoint an emergency economic review team or task force comprised of representatives
om selected Federal departments and agencies to visit South Texas, evaluate the
tuation, design workable solutions which can be implemented immediately by administra-
ve means, and report their findings within 30 days. Following this evaluation, the
roup should meet with Cabinet officials and senior agency staff, including Commerce,
busing, Treasury, Energy, SBA, and EDA to devise a plan of assistance for individuals
ad businesses which have been adversely affected by factors and circumstances beyond
eir control, and, most assuredly, which are not of their own making.
his situation is becoming noticeably worse as each day passes, and we cannot afford
to continue ignoring the problem in hopes that it will somehow mysteriously vanish.
I strongly urge that this matter be given immediate attention. I look forward to hearing
from you soon in this regard.
With best regards.
Sincerely,
John John Tower
JGT/fdm
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
May 2, 1983
MEMORANDUM FOR FRED F. FIELDING
FROM:
JOHN G. ROBERTS
ORR
SUBJECT:
Working Group on South Texas
Richard Darman has asked for comments by close of business
today on Craig Fuller's proposal to establish a working
group on South Texas. The proposal was sparked by a letter
from Senator Tower to Jim Baker, noting that the economic
crisis in Mexico has had a devastating effect on the economy
of South Texas. Under the proposal the working group would
be chaired by a representative from Commerce, and would
contain sub-cabinet representatives from several departments
as well as from specified White House offices. The working
group would report recommendations within 45 days, to be
considered by the appropriate Cabinet Councils.
I see no legal objections. Since all the contemplated
members are federal employees, there are no Advisory Com-
mittee Act problems.
Attachment
THE WHITE HOUSE
WASHINGTON
May 2, 1983
MEMORANDUM FOR RICHARD G. DARMAN
ASSISTANT TO THE PRESIDENT
FROM:
FRED F. FIELDING Orig. signed by FFF
COUNSEL TO THE PRESIDENT
SUBJECT:
Working Group on South Texas
Counsel's Office has reviewed the proposal to establish a
Working Group on South Texas, composed of specified repre-
sentatives from various Cabinet departments and White House
offices. We have no legal objection.
FFF:JGR:aw 5/2/83
CC: FFFielding
JGRoberts
Subj.
Chron
custing file-
?
water,
herey
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
August 3, 1983
MEMORANDUM FOR FRED F. FIELDING
FROM:
JOHN G. ROBERTS
SUBJECT:
Options for Federal Initiative
in the Southwest Border Region
A memorandum revised pursuant to your marginalia is
attached.
Attachment
THE WHITE HOUSE
WASHINGTON
August 3, 1983
MEMORANDUM FOR RICHARD G. DARMAN
ASSISTANT TO THE PRESIDENT
FROM:
FRED F. FIELDING FFF
COUNSEL TO THE PRESIDENT
SUBJECT:
Options for Federal Initiative
in the Southwest Border Region
Counsel's Office has reviewed the above-referenced options
paper, and has no legal objections to consideration of the
various questions presented for decision. With respect to
the merits, we are not convinced of the wisdom of singling
out one area of the country for special treatment. Every
region of our diverse country has peculiar economic
dependencies, and while the southwest border region is now
suffering disproportionately due to peso devaluation, the
region appears to have benefitted disproportionately from
the strong peso between 1978 and 1981.
We would also note that discussion of the fourth question to
be decided contains only a "pro" paragraph -- no "con." The
establishment of an Office of Border Assistance does not
strike us as so obviously desirable that it is impossible to
formulate any arguments against it. For example, in addition
to the general objection to special treatment noted above,
establishment of an additional federal bureaucratic structure
does not seem consistent with our general approach, and may
engender expectations in the southwest border region that we
will not be in a position to fulfill.
FFF: JGR:aw 8/3/83
CC: FFFielding
JGRoberts
Subj.
Chron
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
July 29, 1983
MEMORANDUM FOR FRED F. FIELDING
FROM:
JOHN G. ROBERTS
SUBJECT:
Options for Federal Initiative
in the Southwest Border Region
Richard Darman has asked for comments by close of business
August 2 on the above-referenced options paper prepared for
the President. The subject of the options paper will be
discussed at the Cabinet meeting scheduled for August 9.
The memorandum reviews the economic difficulties of the
southwest border region, noting the dependency of the
economy of that area on the Mexican economy and currency.
The memorandum explains that prior to the recent peso
devaluation the area experienced a boom, and is now con-
fronting the other side of the coin. Specific questions
presented for Presidential decision include:
1. Should a special effort be made to help the border
region?
2. How large a resource commitment is warranted?
3. Should the effort carry a specific price tag?
4. Should the Administration establish a small,
temporary Office of Border Assistance?
None of the proposed options, at least as presently formulated,
present legal difficulties. I do not know to what extent
you want to comment on the policy questions. For my part, I
do not think any special federal effort for the border
region is justified. To paraphrase the famous Fitzgerald-
Hemingway dialogue, the border region is different from the
rest of the country -- it's nearer the border. Every area
of the country has peculiar economic concerns. The
condition of the fishing industry affects New England more
than Tennessee; the international grain market affects
Kansas more than Miami; and, yes, the value of the peso
affects El Paso more than Seattle. As the memorandum notes,
however, when the peso was strong between 1978 and 1981 the
southwest benefitted disproportionately as it now suffers
disproportionately after peso devaluation.
-2-
If you wish to present this viewpoint, I would be happy to
prepare an appropriate memorandum. Assuming you do not, I
have drafted a memorandum noting no legal objection to
consideration of the options, although the draft does
question the absence of a "con" paragraph for the fourth
option.
Attachment
ID # 118830CS cu
WHITE HOUSE
CORRESPONDENCE TRACKING WORKSHEET
o . OUTGOING
H . INTERNAL
John
I . INCOMING
Date Correspondence
Received (YY/MM/DD)
/
/
Name of Correspondent: Richard G. Darman
MI Mail Report
User Codes: (A)
(B)
(C)
Subject: Options for Federal Initiative in the
Southwest Bordes Region
ROUTE TO:
ACTION
DISPOSITION
Tracking
Type
Completion
Action
Date
of
Date
Office/Agency
(Staff Name)
Code
YY/MM/DD
Response
Code
YY/MM/DD
WHOIL
ORIGINATOR 83,07,27
/ /
Referral Note:
CVAT 18
D 83,07,27
S 83,08,02
Referral Note:
WB
/ /
/ /
-
Referral Note:
/ /
/ /
-
Referral Note:
/ /
/ /
-
Referral Note:
ACTION CODES:
DISPOSITION CODES:
A Appropriate Action
I - Info Copy Only/No Action Necessary
A Answered
C Completed
C . Comment/Recommendation
R. Direct Reply w/Copy
B - Non-Special Referral
S Suspended
D . Draft Response
S For Signature
F . Furnish Fact Sheet
X Interim Reply
to be used as Enclosure
FOR OUTGOING CORRESPONDENCE:
Type of Response = Initials of Signer
Code = "A"
Completion Date = Date of Outgoing
Comments:
Keep this worksheet attached to the original incoming letter.
Send all routing updates to Central Reference (Room 75, OEOB).
Always return completed correspondence record to Central Files.
Refer questions about the correspondence tracking system to Central Reference, ext. 2590.
5/81
Document No. 118830CS
WHITE HOUSE STAFFING MEMORANDUM
July 26
DATE:
ACTION/CONCURRENCE/COMMENT DUE BY: c.o.b. TUESDAY, AUGUST 2
SUBJECT: Options for Federal Initiative in the Southwest Border Region
LIMITED CIRCULATION
ACTION FYI
ACTION FYI
VICE PRESIDENT
HARPER
MEESE
HERRINGTON
BAKER
JENKINS
DEAVER
McMANUS
STOCKMAN
MURPHY
CLARK
ROGERS
DARMAN
P
95
ROLLINS
DUBERSTEIN
VERSTANDIG
FELDSTEIN
WHITTLESEY
FIELDING
BRADY/SPEAKES
FULLER
GERGEN
REMARKS:
There will be a full Cabinet meeting with the President on
August 9, 1983. Included on the agenda will be a discussion
of the Options for Federal Initiative in the Southwest Border
Region. Prior to the meeting, please review the attached
options paper and submit you comments by c.o.b. Tuesday,
August 2, 1983.
RESPONSE: Thank you.
Richard G. Darman
Assistant to the President
THE WHITE HOUSE
WASHINGTON
July 21, 1983
MEMORANDUM FOR THE PRESIDENT
FROM:
ROBERT B. CARLESON
Executive Secretary
Southwest Border States Working Group
SUBJECT:
Options for Federal Initiative in the Southwest
Border Region
The Southwest Border States Working Group which you established
in response to problems in the U.S.-Mexico border region has
reported its findings and proposals, and raised several questions
for your decision.
I. FINDINGS AND PROPOSALS
A. Problems
Human and economic problems in the border region* are both
structural and cyclical. Many border counties rank consistently
among the poorest in the nation. Unemployment across much of
the area far exceeds state and national averages, even in good
years. And heavy dependence on retail trade leaves many
localities highly vulnerable to peso devaluations. Barring major
adjustments, these long-term problems are likely to endure, even
as the effects of recent devaluations dissipate and local
businesses revive.
Although similar long-term difficulties afflict border areas in
each border state, problems vary widely in magnitude and
manageability. The region's larger metropolitan areas -- San
Diego, Tucson, El Paso, and, to a lesser extent, Brownsville --
enjoy natural advantages and a basic economic diversity which
help to insulate them from developments in Mexico, and increase
their ability to recover from devaluation shocks. Many smaller
localities are less resilient.
Between 1978 and 1981, the U.S. border region enjoyed a period of
relative boom. Robust economic expansion in Mexico, and the
Lopez-Portillo government's staunch defense of the peso despite
high inflation, brought growing numbers of Mexican shoppers
northward in search of increasingly affordable U.S. goods.
The 36-county area of Texas, New Mexico, Arizona, and
California defined as the border region by the former
Southwest Border States Regional Commission.
2
In addition, more affluent Mexicans, eager to exploit the
peso's artificial strength and to hedge against the effects of
rapid domestic inflation, invested heavily in U.S. border real
estate, inflating property values, sparking new construction,
and increasing bank deposits.
Cumulative damage to U.S. border economies wrought by the 1982
devaluations contrasts sharply with the 1978-81 experience.
Through the first quarter of 1983, as sales dwindled, chron-
ically nigh unemployment and poverty rates in many border
counties rose higher still. Store closures multiplied. And
city and county officials wrestled with declining revenues at
the same time that economic hardship and swelling immigration
increased demands on public services.
However, the effects of devaluation have varied across
jurisdictions. Because of their underlying economic strength,
the larger border cities have experienced devaluation as a
temporary setback. By contrast, smaller, relatively isolated
cities situated on or near the border -- e.g., McAllen, Laredo,
Eagle Pass, Douglas, Nogales, and Calexico -- seem to have been
dealt a powerful and lasting blow.
B. State and Local Response Capacity
At the state level, ingrained attitudes toward state-local
relations affect opportunities for shared Federal-state
responses to border problems. Texas has traditionally
contributed less financial assistance to its localities, and
imposed smaller tax burdens on its citizens and businesses,
than most other states. By contrast, California and Arizona
have chosen historically to maintain higher service levels and
to tax more than many states. New Mexico has fallen somewhere
in between. These patterns of government are unlikely to
change in the face of current peso-related difficulties.
Even where border states might choose to take an active role in
addressing local problems, current budget stringencies would
make it difficult. California, which has exhausted prior-year
surpluses, currently projects a recession-induced revenue
shortfall of $1.5 billion. Arizona and New Mexico have
projected shortfalls of about 13%. Texas appears to be
somewhat better off than its border neighbors, but even that
state faces its hardest fiscal year in recent memory.
Local jurisdictions in those areas hardest hit by peso
devaluation have suffered substantial revenue losses. Their
principal contribution to a general assistance effort is,
therefore, necessarily confined to seeking assistance,
informally as some local officials did in meetings with the
Border States Working Group, and formally through applications
to appropriate Federal and state agencies.
3
C. Options for Federal Initiative
The Administration could exercise a number of procedural and
programmatic options to assist recovery, strengthen the
economic base, and augment local services in the border
region. Procedural options listed below reflect the consensus
of the Working Group. Programmatic options reflect the
judgments of particular agencies regarding the types of
assistance they could supply at current budget levels.
Procedural Options
Recurrent themes in discussions held by the Working Group in
border cities were the need to expedite pending applications to
Federal agencies -- e.g., for Foreign Trade Zone designations --
and the need for a Federal office expressly concerned with
border problems. Option (1) addresses both concerns.
(1) Establishment of a Temporary Office of Border Affairs to
expedite applications, monitor developments in the region,
provide local governments and businesses with information
on Federal programs, help coordinate Federal assistance
efforts, and encourage multi-state cooperation in dealing
with common problems.
Local spokesmen in cities visited by the Working Group were
also concerned with facilitating the flow of cross-border
traffic. They asked especially that Customs and Immigration
officers be added at border ports of entry, and that these
officers be allowed to substitute for one another in
appropriate circumstances. Customs and Immigration have
informed the Working Group that they are responding to these
concerns and, therefore, that one component of a possible
Administration response to border problems is already under
way. Option (2) would help to sustain these efforts.
(2) Regular reviews of staffing needs at border ports of entry
by both Customs and Immigration.
The Working Group has concluded that existing U.S-Mexico
cooperative mechanisms are sufficient to meet current needs in
the U.S. border region. At your August meeting with President
de la Madrid, therefore, you may wish to emphasize that the
Joint Committee on Commerce and Trade (JCCT), which you and
President Lopez-Portillo established in 1981, remains an
effective bilateral forum. You may also wish to invite
President de la Madrid to join you in reaffirming support for
the U.S.-Mexico twin-plant program.
4
(3) Inclusion of items covering the JCCT and the twin-plant
program on the agenda for your August meeting with
President de la Madrid.
The Working Group believes that Federal initiatives in the
border region should take full account of the fact that two
border states are among the wealthiest and most populous in the
nation. Arguably, these states' contributions to a general
assistance effort should reflect their economic strength. To
facilitate a shared Federal-state response to the present
difficulties, therefore, a new Office of Border Affairs might
conduct:
(4) Meetings with state officials to sharpen mutual
understanding of how each level of government intends to
address border problems.
Programmatic Options
Continued weakness in the Mexican economy over the next year or
more, will slow recovery of the retail sector in many U.S.
border communities. Consequently, the Administration's
immediate goal should be a rapid increase in jobs outside
retailing. For the longer term, Federal efforts should aim at
helping border economies to diversify and lessen their
dependence on Mexico. Several options available to the
Administration would serve both of these objectives at once.
(5) EDA Jobs Bill, or Sudden and Severe Economic Dislocation
(Title IX) Grants, from remaining FY 83 resources, to
local jurisdictions to provide new jobs now, and to build
the foundation for future economic diversification. If
Congress funds EDA programs in FY 84, assistance to the
border region could also be provided under EDA's Title I
(public works) technical assistance, and planning grant
authorities. However, Jobs Bill funds would not be
available after September 30.
(6) UDAG Grants to stimulate industrial development in cases
where local matching funds are available. HUD can assist
border localities in preparing grant applications and can
accelerate Federal consideration of such applications.
(7) A special outreach program to accelerate certification of
8 (a) firms, but only if Federal procurement from minority
firms in the border region were substantially increased.
(8) Subordinated, fixed-asset loans channeled through SBA
Certified Development Companies to border area businesses,
possibly in combination with UDAG grants. (SBA can also
make loans directly, at slightly above Treasury borrowing
5
rates, though such loans are not included in the Working
Group's recommendations. The Group has revised its
original view that you have authority to direct SBA to
make low-interest "economic disaster" loans. This
authority was voided by the 1981 Reconciliation Act.)
(9) FmHA assistance for public works, rural housing, and
business development.
Assistance to individuals and local jurisdictions in the border
region could be provided through:
(10) Discretionary Grants Under JTPA, Title III to facilitate
the retraining and reemployment of dislocated workers; and
(11) Department of Education Bilingual Demonstration Grants to
local school districts.
In addition, the U.S. border region would gain indirectly from
any action by the Administration to help speed economic
recovery in Mexico.
II. QUESTIONS FOR DECISION
Several general policy choices logically precede action on any
of the options posed by the Working Group.
(1) Should the Administration make a special effort to help
the border region?
Con. A special border assistance effort might be
difficult to justify on the basis of need. High levels of
poverty and unemployment are hardly confined to the border
counties, and a special initiative there could generate
demands from other regions for comparable treatment. In
addition, more aid for the border could mean less aid for
some other place or purpose.
Pro. Aid to the border region could be justified by the
Administration in terms of sudden and severe economic
dislocation, and not need alone. Such aid would not
jeopardize other priorities, if it were drawn from
appropriations that would not otherwise have been used
(e.g., unexpended EDA grant funds). Budgetary arguments
against this recourse are offset by the likelihood that
Federal efforts will be modest and geographically
confined. Also, public expectations generated by
6
the establishment of the Working Group and by its
proceedings have added weight to the considerations which
argued originally for some kind of assistance effort.
Decision:
Undertake a special
border assistance effort.
Do not undertake a special
border assistance effort.
Other.
(2) How large a resource commitment is warranted?
Large. A large commitment would be consistent with last
year's SBA "peso pack" initiative. (In response to the
1982 devaluations, SBA earmarked $200 million of its
regular loan guarantee authority for use on the border.
Because "peso pack" loans carry market rates of interest,
only 15% of this authority has been exercised.) The
principal component of a large commitment would likely be
SBA direct loans at below-market interest rates. SBA has
about $165 million in direct loan authority remaining in
FY 83. Given the unpopularity of the "peso pack" program,
a large new border assistance effort which included
low-interest loans would be a widely recognized symbol of
Federal responsiveness.
Small. Though peso-devaluation has affected the entire
border region, the worst damage and dimmest prospects for
early recovery are confined to a relatively few small
cities and towns. Limited expenditures would suffice to
reduce devaluation-related unemployment and to promote
economic diversification in these localities; and a number
of other helpful responses (e.g., expediting Foreign Trade
Zone designations) could be virtually cost free.
Practically speaking, therefore, the immediate problems of
the border region do not call for major Federal
expenditures. In addition, an assistance package
comprised largely of low-interest loans would be unlikely
to create many new jobs quickly or to promote economic
diversification. (Indeed, some border merchants reject
the idea of "soft" loans on the grounds that current cash
7
flows would prevent repayment, at any interest rate.)
Finally, a large border assistance effort could prompt
demands for proportionate consideration from other
distressed areas.
Decision:
Federal initiatives in the
border region should involve a large
commitment of resources (e.g., $100 million)
Federal initiatives in the
border region should involve a small
resource commitment (e.g., $20 million).
Other.
(3) Should the Federal assistance effort carry a specific
price tag, or should program managers simply be instructed
to consider project proposals emanating from border
counties on a priority basis?
Price tag. Federal assistance to the border region would
be more recognizable publicly if it were quantified in
advance.
No price tag. Politically, a small price tag could be a
liability. And any price tag, large or small, could
crystalize demands from other economically troubled
regions for similar consideration. Also, after September
30, primary sources of financial aid may be programs for
which the Administration has requested no FY 84 funding.
Instructions to program managers, in effect, to move
applications from the border region to the head of the
queue or to take recommended procedural steps would
probably require a round of bilateral discussions between
White House staff and the appropriate managers.
Decision:
Federal assistance efforts
should carry a specific price tag.
Federal assistance efforts
should carry no price tag.
Other.
8
(4) Should the Administration establish a small, temporary
Office of Border Assistance?
Pro. An office of three or four people, possibly with a
Director recruited from the border region itself, would
partially satisfy requests by some border spokesmen for an
organizational expression of Federal concern. Such an
office would help to expedite and coordinate Federal
assistance efforts, and meet with state officials to
promote multi-state and Federal-state cooperation.
Decision:
Create a small, temporary
Office of Border Assistance.
Do not create an
Office of Border Assistance.
Other.
DATE: 8-10-83
The New York Times
PAGE:
A14
waking group
Reagan Studies Proposals to Help
on south Texas
Cities on the U.S.-Mexican Border
By FRANCIS X. CLINES
Special to The New York Times
WASHINGTON, Aug. 9 President
view of some of the President's politi-
Reagan today received a series of
cal advisers that, considering the elec-
proposals that Federal agencies be di-
toral importance of Texas, Mr. Reagan
rected to channel Government help to
must offer specific proposals for the
economically troubled communities
border troubles when be visits the
along the Mexican border.
state.
The proposals were presented to the
"That's not unusual at this point in
President at a Cabinet meeting in ad-
any Administration," the official said.
vance of a politically important trip to
White House strategists recently
Texas this weekend. The proposals
scheduled several showcase events for
were not made public, but White House
the President and Hispanic-American
officials who attended the meeting said
leaders. Today Mr. Reagan had lunch
they were designed to redirect existing
with a group of Hispanic leaders and
programs and funds to ease the eco-
heard their appeal for action to deal
nomic troubles of border towns and
with the economic distress along the
cities hard hit by the devaluations of
border. The leaders also urged the ap-
the Mexican peso.
pointment of more Hispanic Ameri-
cans in the Administration and voiced
Before the devaluations, when 27
objections about pending proposals to
pësos bought a dollar's worth of Ameri-
revise the immigration law.
can goods, Mexican shoppers flooded
After the luncheon meeting, the
across the border. But in the last year
President and his Cabinet met pri-
the Mexican Government has reduced
vately to hear the proposals of a study
the peso's value more than 80 percent,
group on the border problems. Mem-
and it now costs 150 pesos for the same
bers of the group, created after Mr.
American goods. The retail economy
Reagan visited Texas last May and led
has been shattered and unemployment
by Assistant Secretary of Commerce
has risen above 25 percent in some
Robert G. Dederick, were not available
areas.
for comment.
Situation Is Seen as Urgent
"The proposals would require each
agency to get in and take a look at its
Mr. Reagan, whose aides have been
programs and see what could be pro-
emphasizing the Administration's
vided," one Administration official
sensitivity to key Hispanic-American
said after the meeting. "They'd look
problem areas lately, made no final
for funds not being allocated or spent
decision on the proposals today, ac-
now and set definite border priorities, a
cording to Administration officials who
redirection of existing resources."
spoke on the condition that their names
not be used. Some Administration polit-
Long-Term Solutions Studied
loal advisers said privately, however,
Senator John Tower, Republican of
that the President would address the
Texas, has proposed a series of emer-
subject on Saturday, when he is sched-
gency measures to boister the econo-
uled to speak in El Paso to the Ameri-
mies, school budgets and social pro-
can G.I. Forum, a Hispanic-American
grams of the border communities.
group.
These include long-range legislative
"It's hard to put a dollar figure on
proposals as well as more immediate
what's under consideration," one offi-
executive steps.
cial said, emphasizing that the propos-
Vice President Bush, in line with the
als stressed the urgency of the eco-
White House's political emphasis, ad-
nomic troubles and the need to press
dressed the National Hispanic Voter
Federal agencies to expedite existing
Registration Campaign today in San
laws that provide help in such areas as
Antonio. He was asked at a news con-
economic development, free trade
ference what the solution was for the
zones, small business assistance and
troubles of the border towns and he re-
urban development grants.
plied, "Recovery of the Mexican econ-
One official said there was consider-
omy is best by far.' He echoed some of
able debate within the Administration
the Administration debate over the
over the proposals because some of
emergency measures the President
them, if adopted, would go against the
heard today, because some officials
existing overall budget policy to cut
question the value of short-term meas-
back on certain economic development
ures that do not guarantee the return of
and small business programs. The offi-
Mexican shoppers to the border towns.
cial acknowledged, however, that this
After speaking Saturday in El Paso,
concern might be overridden by the
President Reagan is to-cross the border
to La Paz for a visit with President Mi-
guel de la Madrid Hurtado. They are
expected to confer on such subjects as
Mexico's economic troubles and the
18
Reagan Administration's Central
American policies.