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[07/28/1994 – 06/04/1997]
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[07/28/1994 – 06/04/1997]
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ARMS Email System
RECORD TYPE: FEDERAL (RECONSTRUCTED EMAIL)
CREATOR: Michael C. Dost
(DOST_M) (OMB)
CREATION DATE/TIME:28-JUL-1994 09:37:00.00
SUBJECT: ALL STORIES
JULY 28, 1994
TO: Remote Addressee
(D
KLEINBERG@1=US@2=ATTMAIL@3=GOV+DOT@4=QMAIL@5=HQ@MRX@EOPMRX)(DEFAULT,)
READ: UNKNOWN
TEXT:
DAILY REPORT FOR EXECUTIVES
Available each working day at 9:00 AM
Report for JULY 28, 1994
TODAY'S SUMMARIES
House Leaders Mull Phasing In Mandate Based On Size Of Company Payroll --
House Democratic leaders are considering a plan to phase in an employer
mandate to provide health coverage over four years, based on the size of a
company's payroll, sources tell BNA. The leadership was considering late July
27 the final shape of the health care bill they plan to unveil publicly July
29. House Majority Leader Gephardt is still mulling some changes to the
measure to ease the burdens on businesses and to make the bill more
politically viable
In the Senate, Majority Leader Mitchell is readying
a health care reform bill to present to his Democratic colleagues as early as
July 29 that is expected to mirror closely the bill reported by the Finance
Committee, including a triggered mandate, Democratic senators say. G-8, G-6
Role Of Lobbyists In European Union Policy-Making Increases, Evolves --
Lobbying in the United States has a tradition as old as the Constitution's
guarantee of citizens' rights to petition the government, but lobbying in the
infant European Union is still in an embryonic stage, with virtually no formal
rules and few established practices. Lobbying in the EU is, however, growing
and evolving, along with the Union's developing institutions. A BNA special
report examines the current circumstances of lobbyists in the EU and the
substantive issues they address. Special Report
Administration Flexible On Trade Fast-Track Issue, Yerxa Says -- Deputy
U.S. Trade Representative Yerxa says the Clinton administration is willing to
compromise on a seven-year extension for fast-track authority for new trade
agreements contained in its proposed legislation implementing the Uruguay
Round trade pact.
In another development, Treasury Secretary Bentsen
offers Finance Committee Chairman Moynihan and ranking Republican Packwood a
modified package of financing proposals to offset more than $12 billion in
lower tariff collections that would result from the trade pact. A-11, G-9
Durable Goods Orders Up 1.3 Percent In June, Commerce Reports -- Strong
demand for capital goods and transportation equipment hiked new orders for
manufactured durable goods 1.3 percent to a seasonally adjusted $151 billion,
the Commerce Department reports. It was the fourth consecutive monthly
increase and the 10th advance posted in eleven months. N-1
U.S., Canada Fail To Resolve Agriculture Impasse; Agree To Continue Talks
-- While U.S. Trade Representative Kantor and Canadian International Trade
Minister MacLaren do not announce any progress in discussions on a
long-simmering agricultural dispute, the trade officials agree that talks will
continue. The two sides are attempting to avert what could spiral into a
full-fledged trade war if the United States makes good on its threat to
restrict Canadian wheat. A-9
Superfund Bill Progresses In House; Move On Retroactive Liability Thwarted
-- Superfund reform takes another step forward with the approval of the
administration-backed bill (HR 3800) by the House Public Works and
Transportation Subcommittee on Water Resources and the Environment. Prior to
approving the measure on a voice vote, the panel defeats controversial
amendments to eliminate retroactive liability for polluters and to further
loosen ground water cleanup standards. Full Public Works Committee markup is
scheduled for today. The Senate Environment and Public Works Committee set
markup of its administration backed-bill (S 1834) for Aug. 3. A-28
Reforming Worker Status Tax Laws Could Raise $34.7 Billion, Study Finds
Repealing laws that prevent the reclassification of workers and independent
contractors would raise $4.9 billion over the fiscal 1996 through 2004 period,
and more aggressive enforcement of worker status rules by IRS would raise an
additional $29.9 billion, according to a Coopers & Lybrand study prepared for
the Coalition For Fair Worker Classification. G-3
Fed Approves Rules To Remove Bank Anti-Tying Restrictions - The Federal
Reserve Board approves final and proposed changes to Regulation Y that remove
several anti-tying restrictions for bank holding companies, their affiliates,
and non-bank subsidiaries. In one action, the board agrees to finalize a rule
it proposed in March that expands to all bank holding companies an exemption
from anti-tying rules recently granted to First Union Corp., Charlotte, N.C.
In another, the board agrees to seek comment on a proposal that would benefit
non-bank subsidiaries of bank holding companies.
A-8
Ways-Means Approves Tax Hikes To Fund Clinton Maritime Reform Plan The
House Ways and Means Committee approves a mix of tax increases to finance the
Clinton administration's maritime reform program (HR 4003), including large
hikes in tonnage fees and the ship passenger departure tax. The three-part
plan, which would raise $1 billion in revenues, wins voice vote passage,
despite opposition expressed by many lawmakers on the panel to the tax
increases. G-2
House Panel Adopts Fraud/Abuse, Health Data Provisions To Reform Plan --
The House Government Operations Committee votes to report out portions of the
Clinton administration's health care plan (HR 3600) dealing with health care
information practices and fraud and abuse procedures. Committee Chairman
Conyers says experts had told the committee that fraud and abuse within the
health care system cost about $100 billion annually, which represents about 10
percent of the $1 trillion spent nationally on health care. A-16
TEXT
JCT staff description (JCX-10-94) of HR 4003, "Maritime Administration
and Promotional Reform Act of 1994" L-1
IRS Rev. Proc. 94-54, relating to unused housing credit L-3
ALSO IN THIS REPORT
*
International Trade - The United States and Japan have agreed to
continue the 1991 U.S.-Japan Semiconductor Arrangement until it expires July
31, 1996, even though Japan has been dissatisfied with the agreement because
of its "expectation" of the U.S. and foreign share of the Japanese
semiconductor market reaching more than 20 percent. A-6
*
Health Care -- Exchanges between a Senate panel and a pharmaceutical
industry representative highlight the difficulty Congress will face as it
tries to balance including prescription drug coverage in health reform
legislation with implementing mechanisms to restrain rising drug costs. A-8
*
Communications - With nearly $500 million in bids so far, the Federal
Communications Commission's first-ever auction of airwaves continued late July
27, leaving officials to guess how high the final tally would go. A-27
International Finance
MOST IMF DIRECTORS SUPPORT NEW SDR ALLOCATION, 1994 REPORT
SHOWS
The majority of directors at the International Monetary Fund would
support a new allocation of special drawing rights (SDRs)--the first issue in
more than a dozen years--to meet growing, long-term capital needs worldwide,
an advance copy of the IMF's 1994 annual report released late July 27 showed.
Many IMF directors, who met to discuss the issue of SDR allocations in
July and September 1993, said they were particularly concerned about Fund
members who had never received an SDR allocation, or those who had not
participated in distributions made since the first disbursement in January
1970, the report showed.
Economists have said this concern specifically applies to the countries
of Eastern Europe, who now are making the transition from command to market
economies and who are short on cash reserves.
The IMF defines the SDR as "an international reserve asset the Fund can
create as and when it determines that there exists a long-term global need to
supplement existing reserves."
The SDR exchange rate for July 27 was $1.46, the IMF said. No SDR
allocations have been made since 1981, data provided by the IMF's SDR
Department showed.
During its July 8-10 meeting in Naples, Italy, leaders from the world's
seven leading industrial nations endorsed measures under consideration by the
IMF to ensure that all member nations partake in the SDR system (131 DER
C-3, 7/12/94). The so-called Group of Seven are the United States,
Japan, Germany, Great Britain, France, Canada, and Italy.
At that time, Treasury Secretary Lloyd Bentsen noted that the Fund has
about $40 billion in assets and $30 billion in loans outstanding, leaving a
$10 billion financial cushion and ample room for expanded assistance.
Article IV Discussions Expanded
The 1994 annual report also outlines the content of so-called "Article
IV" -- or economic policy - discussions undertaken between the IMF and more
than 30 nations during the fiscal year ended April 30, 1994, up from about 20
countries the preceding financial year. The latest report has been expanded
to include summaries of talks with select developing nations--such as
Indonesia, Brazil, and Mexico--and countries making the transition from
command to market economies, such as the Czech Republic and Ukraine.
Fund officials explained that the upswing in Article IV reporting is in
response to pressure from member countries, including the United States and
the Congress, who have called on the IMF to be more open about its decision-
and policy-making processes. Article IV assigns the IMF responsibility for
reviewing the macroeconomic policies of member countries.
Other data released by the IMF showed that purchases from the Fund's
general resources account in 1993-94 totaled SDR 5.2 billion, about the same
as the previous year; that the number of countries in arrears to the IMF fell
to nine as of April 30, 1994, down from 12 a year earlier, with the level of
outstanding obligations falling to SDR 2.9 billion; that the Fund's usable
resources rose from SDR 52.2 billion last year to SDR 54.3 billion; and that
total IMF credit outstanding rose by SDR 1.4 billion during the financial
year.
The latest annual report, which is slated for publication and formal
release in September, also showed that the Fund's staff advanced 5 percent
over the course of the year. IMF departments working with countries making the
transition from command to market economies accounted for most of the increase
in staff, the Fund said.
Debate Over SDRs Continues
The advance copy of the Fund's 1994 annual report showed that during a
meeting held in July 1993, most of the IMF's directors supported a new
allocation of SDRs, pointing to the growing need for reserves worldwide and
the relatively low level of reserves currently held by many developing
countries and economies in transition. In addition, some IMF officials noted
that boosting reserves through borrowing or compression of domestic demand and
net exports are high-cost propositions for most countries.
"For low-income countries and countries in transition, the economic and
financial costs of acquiring the additional reserves necessary to protect
their growth and transformation efforts would substantially exceed the
economic opportunity cost of creating reserves through an allocation," these
directors concluded.
A dissenting minority, however, said the current evidence was not
compelling enough to warrant a new allocation of SDRs. Credit from private
capital markets was sufficient to meet countries' reserve needs, they said.
Many IMF directors, meeting to discuss the issue of SDR allocations again
in September 1993, said they were particularly concerned about Fund members
who had never received an SDR allocation or those who had not participated in
SDR allocations made since the first disbursement in January 1970.
The group decided that, under the IMF's Articles of Agreement, the Fund
does not have authority to make a selective allocation of SDRs to new members
or to reallocate SDRs by combining the cancellation of existing SDRs with a
new allocation.
"Many Directors were of the view that, practically speaking, the problem
of inequity would be resolved most effectively by offering new members an
appropriate stake in the SDR system through a new allocation," the report
stated.
The IMF is scheduled to discuss SDR issues again in October, when the
Fund meets in Madrid, Spain. At that time, the interim committee investigating
SDR issues is expected to release its recommendations.
The main question, private sector economists said, is whether there will
indeed be a new SDR allocation, and if so, under what terms will a new issue
be made.
International Trade
EUROPEAN UNION SHOULD HAVE CLOSER TIES TO U.S. STATES,
PARLIAMENT MEMBER SAYS
NEW ORLEANS--The European Union should increase its interaction with U.S.
legislators and decision makers in the states, the level that "matters most
to the people," Alan Donnelly, a member of the European Parliament, said July
27.
Donnelly suggested the European Parliament and the National Conference of
State Legislatures, which is holding its annual meeting in New Orleans, forge
formal links similar to the relationships the European representative body has
with Congress and the administration.
"We need to take more seriously the relationships with the states," he
said. "I hope we can come up with something over the next few months."
Donnelly said he thought it unfortunate that negotiations on the Uruguay
Round of the General Agreement on Tariffs and Trade only involved policy
officials at the national level.
"It isn't just people at the national level who are affected," he said.
"It should be a dialogue that involves people in the individual states and
the citizens in the EU. That didn't happen with the Uruguay Round, so we need
to start preparing [for greater involvement] in negotiations in the future."
Donnelly said the term "subsidiarity" has been used by EU member
nations to define taking decisions to the most appropriate official. "I've
learned that the only game in town is not in Washington, D.C., but in state
capitals throughout the country."
States and the EU member nations face common issues in establishing trade
relationships, foremost among them the protection of workers in the
industrialized nations as developing nations continue to grow economically.
"It's very difficult for those workers to compete with workers in
countries where there are no health and welfare provisions and low wages," he
said. "We have the common agenda to open up trade, but we mustn't simply hand
everything over to the disadvantage of the worker in the United States and the
European Union."
Other issues common to the two trade partners, he said, include crime,
education, job training, higher education and drug abuse.
The European Union is a market of 340 million people and its largest
trade partner is the United States, Donnelly noted. Some 300,000 jobs have
been created in the U.S. because of European investment, he said. The Union
will expand to 370 million people later this year when Norway, Sweden, Finland
and Austria become members.
In two years, "we will be revisiting the treaties that formed the
European Union," he said. "We look to you as a model in many ways."
Communications
COURT REMANDS 'PIONEER PREFERENCE' DECISION TO FCC FOR
RECONSIDERATION
An appeals court July 26 sent back to the Federal Communications
Commission a case challenging its policy of granting free "pioneer
preference" licenses to companies that have made innovations in the
telecommunications field.
Christopher Wright, deputy general counsel at the FCC, told BNA that the
court issued a total remand with no timetable attached. However, he said, the
commission promised to issue a new order within two weeks of receiving a
remand, and it fully expects to comply with the promise.
At issue is whether the FCC should issue free "pioneer preference"
licenses to three companies that had made significant innovations in the
communications field (131 DER A-8, 7/12/94). The commission
promised the licenses to the companies before Congress authorized the FCC to
auction spectrum last year.
In March, Pacific Bell filed suit in the U.S. Court of Appeals for the
District of Columbia challenging the commission's decision to grant free
pioneer preference licenses.
Although interested companies may bid on licenses in an auction to be held
later this year, the licenses could cost hundreds of millions of dollars.
Pacific Bell argued this places the pioneer preference companies unfairly
ahead of the competition.
Although FCC officials have not yet announced what their new order will
be, the commission has said their rationale for awarding free licenses "is no
longer adequate."
Pioneer Sacrifice A statement issued by American Personal
Communications, one of the three companies promised a pioneers preference
license, speculated that the FCC could charge up to 90 percent of the amount
the licenses would bring at auction.
"Pioneers earned their licenses through sacrifice, toil, creativity, and
investment (in APC's case an investment exceeding $20 million) in very
high-risk ventures," the statement said.
The company previously said it would pay a "reasonable fee" for the
pioneer preference license, which it defined as no more than 75 percent of the
auction amount.
The APC statement also cited two economists, John P. Gould, economics
professor at the University of Chicago Graduate School of Business, and
Gustavo Bamberger, vice president and senior economist at Lexecon Inc., an
economics consulting firm. The economists said there is "a social and
economic harm inflicted by a commission decision to change the rules of the
pioneer program by charging the pioneer firms after the fact when they made a
successful good-faith effort to meet the conditions of the original concept."
FCC's Wright told BNA that after the commission issues its new order, it
could be challenged again. "We don't think any of this should hold up the
auction," he added.
European Union
EUROPEAN COMMISSION TO CONCENTRATE ON COMPLIANCE WITH
CURRENT SOCIAL RULES
BRUSSELS--Throughout the 1990s, the European Commission will not propose
any significant new laws in the social affairs area and will instead
concentrate on ensuring national compliance with existing European Union
rules, Social Affairs Commissioner Padraig Flynn told a reporters July 27.
National compliance is one of the main priorities running through the
commission's "White Paper on European Social Policy," which Flynn unveiled
the same day.
The 53-page white paper sets out a general medium-term strategy for EU
policy through 1999 and identifies as other social priorities the need to
encourage job creation and the promotion of high labor protection standards as
a means to building a competitive Europe. Flynn stressed that Europe "has to
explore the balance between higher labor standards and job creation" with a
view to reconciling the twin objectives of economic growth and social
progress.
The commission will implement the white paper through a detailed work
program that it will issue in early 1995 after the Council of Ministers has
approved the white paper, Flynn said. The council will discuss the white paper
during its meeting Sept. 22 and is expected to approve it during its Dec. 6
session.
Vigorous Pursuit On Implementing Labor Laws
In the field of national implementation, Flynn said that the EU must
"vigorously" pursue member states that do not implement labor laws.
He explained that member states have all been very slow to implement
the package of 37 directives that should have been in place since at least
Dec. 31, 1993. These rules include health and safety measures and protection
of workers in the case of mass dismissal or transfer of ownership of a
company.
Of the 37 rules, some member states have implemented just over half, he
said. In the field of health and safety, where the EU has adopted one
framework directive and 10 implementing rules, only France has implemented all
11 laws. Germany, Spain, Greece, Italy, and Luxembourg have not even
implemented the framework directive, Flynn said.
He explained that lack of EU-wide implementation "caused great
concern," and that the commission "must not let this situation distort
competition."
Although Flynn said that the commission would not come forward with
"any significant new body of legislation," he did say that in some areas the
EU "would have to develop the legal base where needed" by pushing through
with draft proposals. These concern the directive on worker information and
consultation that still requires formal approval and the blocked directives on
subcontracting and atypical--temporary and part-time--work. Flynn said that
if these proposals remained blocked in the Council of Ministers, the
commission might have to decide to submit them to the Social Protocol that
requires only qualified majority voting in the Council of Ministers.
Legislation adopted under the protocol does not apply in the U.K., which
refused to sign on to the protocol, a special annex to the Maastricht treaty
on European Union.
Flynn also said that the working time directive should be amended to
cover the transport sectors.
In addition some new rules may be necessary in the health and safety
area and regarding equal treatment. Both areas will be the subject of new
action programs in 1995.
Flynn Urges Review Of UK Opt Out
During the news briefing, Flynn also said that during the 1996 review
of the Maastricht Treaty on European Union the member states should eliminate
the United Kingdom's opt out of the Social Protocol, which enables the 11
member states to adopt social legislation by qualified majority vote. Such an
amendment would require British approval. The review "is a good time to
consider a single framework for European social policy," Flynn said.
The UK objected to the protocol on grounds that qualified majority voting
would make it too easy to introduce new laws that would serve only to increase
costs for companies and undermine Europe's competitiveness. For this reason
the current British government has no intention of relinquishing its social
opt out.
In reaction to the commission's support for a single framework, a
spokesman for the British government in Brussels quoted Employment Secretary
Michael Portillo as saying that the opt out "is here to stay. It is not
negotiable."
Flynn denied that higher labor standards undermine European
competitiveness and excluded the possibility that the commission might
consider lowering standards to improve Europe's competitive position on the
world market. "We do not accept that higher social standards are an added
cost, but instead are a key element of our competitive formula," he told
reporters.
He said that lower standards supply only a short-term competitive gain
and "will not lead to long-term competitive superiority," in part because
lowering standards will undermine workforce motivation.
To encourage job creation the white paper calls for improvements in
investments in education and training and the creation of a truly European
single market. With this objective in mind, the commission plans to create a
high-level panel of experts to review remaining obstacles to the creation of a
European labor market, examining for example national practices regarding
immigration and social security protection.
International Economics
CANADIAN INDUSTRIAL PRODUCT PRICE INDEX UP 0.6 PERCENT IN
JUNE, STATSCAN REPORTS
OTTAWA--Canada's industrial product price index rose 0.6 percent in June
to 118.2 (1986=100), Statistics Canada reported July 27.
The increase followed a 0.3 percent increase in May and 0.2 percent in
April, the federal statistics agency said.
On a year-over-year basis, the IPPI was up 5.5 percent in June.
"Inflationary pressure continued to come almost entirely from
intermediate goods, while manufacturers' prices for consumer goods tended to
remain stable overall or fell," StatsCan said.
The agency noted that year-over-year growth in producer prices in Canada
remains appreciably higher than in the other G-7 countries. The next highest
rate is the 3.5 percent reported in Italy in March, although that country
generally has an appreciably higher level of inflation than in Canada, it
said.
"This is consistent with the Canadian economy being further along in the
recovery process than certain other economies in the G-7," the agency said.
"However, the structure of Canada's manufacturing sector differs from that in
other G-7 countries: processing raw materials and exporting these products
plays a much larger role in Canada."
The largest price increases in Canada in June were for primary metal
products, up 2.5 percent, paper and paper products, up 2.1 percent, furniture
and fixtures, up 1.6 percent, and petroleum and coal products, up 1.1 percent.
Raw Materials Prices Up Statistics Canada also reported July 27
that its raw materials price index increased 2.2 percent in June to 124.0
(1986=100), the sixth consecutive monthly increase, but smaller than the 3.3
percent in May and 3.7 percent in April.
The June increase represented a year-over-year rise of 7.9 percent.
The RMPI excluding mineral fuels increased 0.2 percent in June, after a
1.0 percent increase in May. June's figure represented year-over-year growth
of 7.2 percent.
Increases were reported for mineral fuels, up 7.2 percent from May and
up 9.7 percent from June 1993; non-ferrous metals, up 5.5 percent from May and
28.8 percent from June 1993; vegetable products, up 0.5 percent from May and
21.6 percent from June 1993; and wood, up 0.1 percent from May and 3.1 percent
from a year earlier.
Decreases were reported for ferrous materials, down 4.6 percent from
May, but up 10.2 percent from June 1993, and for animals and animal products,
down 1.7 percent from May and down 3.3 percent from a year earlier.
No change was reported for non-metallic minerals from May, although
that index was up 1.2 percent from June 1993.
International Economics
WESTERN GERMAN CONSUMER PRICES UP 2.9% IN JULY, GOVERNMENT
REPORTS
FRANKFURT-Western German consumer prices rose 2.9 percent in July
compared with one year ago while rising 0.1 percent from June, the Federal
Statistics Office reported July 27.
The provisional data again place the annual price rise below 3.0 percent,
as initially was reported in June and May. Provisional data for both months
placed the annual rate at 2.9 percent before later revisions raised it to 3.0
percent.
Final July data, which include a breakdown of categories, is expected in
mid-August.
The rate of inflation has been edging down slowly since posting a 3.5
percent annual growth rate in January. The continuing effect of modest wage
rounds early this year is expected to help bring inflation down to around 2.5
percent by the end of this year.
The Bundesbank has targeted 2.0 percent annual inflation as its medium
range target.
Provisional consumer price data is based on reporting from the four most
populous German states.
Those numbers indicate drops in seasonal food items as the domestic
harvest supplants imported products. Declines in heating oil were offset by
steep year-to-year increases in motor fuel due to higher fuel taxes. Rents and
service charges continue to boost inflation, according to data from Bavaria,
North-Rhine Westphalia.
International Economics
JAPANESE ECONOMY SAID TO SHOW SIGNS OF RECOVERY, BUT
PROBLEMS PERSIST
TOKYO--The Japanese economy continues to show some signs of recovery, but
continues to struggle with problems resulting from the bursting of the
speculative bubble, according to a government report released July 27.
And in order to reinject vigor into the stagnant economy, Japan needs
to expedite a program of government deregulation and administrative reforms
while directing the economy toward new, higher value-added industries, the
Economic Planning Agency concluded in its annual "Economic Survey of Japan
1993-1994."
The 718-page report, subtitled the "A Challenge to New Frontiers
Beyond the Severe Adjustment Process," said that in fiscal 1993 (April 1993
to March 1994), "favorable movements" began to appear in "some areas of the
economy." As a whole, however, the report characterized the year as "the
year of downside risk" not experienced by the country before.
The major reason causing such a risk and having led to zero growth in
fiscal 1993, it said, are "unpredictable exogenous factors" such as the
continued appreciation of the yen, balance sheet adjustments forced on banks
and corporations by the bursting of the bubble, failure of monetary and fiscal
policies to have anticipated effects, and structural problems.
Above all, the strong yen had one of the most powerful deflationary
effects on the Japanese economy, the report noted. The Japanese currency
appreciated as much as 2.7 percent on a monthly basis between January and
August 1993, when calculated on the basis of the dollar versus yen rate
standing before the September 1985 "Plaza Accord."
The three-chapter report said the strong yen caused contrasting
movements in Japan's balance of payments, with the yen-based current account
surplus contracting while that on the dollar base expanding, putting adverse
pressure on domestic corporations and prompting foreign complaints that the
Japanese surplus does not decrease.
Sluggish Consumer Spending
Fiscal year 1993 also was marked by sluggish consumer spending
resulting from low personal income growth. The year also was punctuated by
reduced capital expenditures, which contracted in the January to March 1994
period for the 10th consecutive quarter. Here, too, the strong yen's adverse
effect was apparent, the report said, noting that corporations have become
pessimistic about future production recovery. Corporate earnings decreased by
an average 9.7 percent, falling for the fourth straight year and forcing firms
to restructure.
However, one area that escaped the impact of the strong yen was
housing, the report said.
Employment Conditions Deteriorating
As the economy languishes, employment conditions are deteriorating.
"Overtime hours are still decreasing, as well as the job offers-to-seekers
ratio which peaked in March 1991 while the growth of employment began
decreasing for the manufacturing sector since early 1993," pushing up the
unemployment rate, the report said.
Specifically, the employment problem is hitting hard some parts of the
labor market workers who have lost jobs, mid-level managers, and female
workers, it said, describing them as "discouraged workers" who unwillingly
started exiting the labor market since 1993.
Imports, Exports
While the strong yen's effect on the domestic front was generally
negative, it proved effective in boosting Japan's import volume and clipping
export volume, the report said. Export prices fell on a yen basis yet rose on
a dollar basis, and in line with the movements, "nominal exports turned into
a rapid decrease on a yen basis while continuing to increase on a dollar
basis." Import volume, meanwhile, increased overall, "in particular, a huge
increase in import volume -- mainly of manufactured goods -- was
conspicuous," it said.
Imports, as against overall domestic supply, increased, "implying that
domestic production might be more suppressed by import substitution at this
time different from the past historic pattern," it said.
In response to the trade-related trends, the FY 1993 yen-based current
account surplus fell, even though the dollar-based figure expanded, with the
ratio of the current account surplus against gross domestic product falling to
3 percent in fiscal 1993 from 3.4 percent in fiscal 1992, the report said. The
Clinton administration is demanding that the ratio be reduced to a low 2
percent level.
The report refuted the U.S. Council for Economic Advisors's annual
report, which described the Japanese trade structure as unusual and pointed
out that Japan's ratio of imports of manufactured goods to domestic
consumption is low.
"This indicator has a drawback," it said. "The effect of increased
import volume is canceled by a/decline in the yen-denominated import prices.
Therefore, measured by 'real manufactured import/real GDP,' Japan's ratio
rapidly increased after the Plaza Accord, and also registered a huge increase
in 1993."
Fiscal, Monetary Policies Defended
The report defended Japan's fiscal and monetary policies, both of
which failed to energize the economy despite increased public works
expenditures and monetary policy easing. "Had it not been for increased
public works, private-sector demand could have decreased further" and that a
decline in nominal interest rates is having positive results, it said.
The report noted "some bright signs" in the Japanese economy such as
steady public works spending, brisk residential housing investment and
recovery in personal consumption, but it hedged on the possibility that the
economy can head in either direction.
On the positive side, domestic stock adjustment has progressed and
Japan's economic stimulus packages are helping to underpin business activity
while overseas economies are recovering. Yet, "it should be noted that the
trends in exchange rates and the delay in the balance-sheets adjustment remain
as downside risks."
In the longer perspective, the Japanese economy needs to address its
structural issues, the report said. Thanks to sizzling growth during the
bubble economy period, "many structural problems have been overlooked, but
due to the present stagnation, they have come to stand out sharply. It is like
seeing the doctor for a common cold and you are told about hypertension."
Among those structural problems are those related to industry hollowing
and price gaps between Japan and overseas as a result of the strong yen and
prolonged recession; those on the economic system like employment; those on
structural issues like government regulations; and those related to economic
"frontiers," the report said.
Industry hollowing for the electronics industry, for example,
progresses at the pace of 1.6 percent in direct investment to Asia when the
yen's appreciation develops at the pace of one percent.
That hollowing could be prevented by developing economic efficiency and
expansion, e.g. by shifting domestic economic resources to higher value-added
areas.
Deregulation Will Be Key
Deregulation will be a key in helping to encourage businesses to
become more forward-looking, the report said. As high as 42 percent of the
overall Japanese industry presently is subject to some form of government
regulations.
"Deregulation is expected to play an important role in vitalizing
domestic demand by expanding business opportunities and consumer choice; in
narrowing the international price disparity by injecting competition in the
nonmanufacturing sector with low productivity; and in increasing
transparency," the report said. For example, telecommunications sectors could
develop into multimedia and thereby create new demand.
The report said Japan has undergone a period of catch-up with the
United States and now needs to develop new, leading industries. Yet, it said,
"It is not easy for us to specify future leading industries."
Economists welcomed the report as generally well done in analyzing the
state of the Japanese economy and the aftermath of the bursting of the bubble.
However, they commented that it was too optimistic about recovery and
contained little substantive prescriptions for prolonging the next expansion
cycle.
"If it was written after the yen broke through 100, the tone might
have been different," Susumu Taketomi, managing director and chief economist,
Industrial Bank of Japan Ltd., said.
Small Business Report
The adverse impact of the strong yen on Japanese manufacturing
industries is more serious than generally thought, according to a report by
the Small and Medium-size Enterprise Agency, a unit of the Ministry of
International Trade and Industry, released July 25.
More than 90 percent of export-oriented small and midsize corporations
and their subcontractors said they were affected by the latest round of yen
appreciation, the report said. It was based on a survey of 137 small and
mid-size companies across Japan.
One-third of the respondents said their foreign exchange break-even
point is between 105-110, of which 60 percent said they will incur losses
under 110 yen. Only 1.6 percent of all respondents answered they can secure
profit below 100 yen.
And 79.8 percent of the surveyed said they were suffering export
contract declines.
Asked how to cope with the currency problem, 45.8 percent said they
were planning to change their businesses into new fields or develop new
products. On a sobering note, 16.8 percent said they have exhausted options.
International Trade
U.S., JAPAN AGREE TO CONTINUE 1991 SEMICONDUCTOR ARRANGEMENT
The United States and Japan have agreed to continue the 1991 U.S.-Japan
Semiconductor Arrangement until it expires July 31, 1996, the Office of the
U.S. Trade Representative announced late July 26.
U.S. and Japanese trade delegations made the announcement after a
mid-term review of the five-year agreement, which is intended to increase U.S.
and foreign share of the Japanese semiconductor market. The agreement's terms
called for a review at the end of the third year to jointly decide whether to
terminate the pact.
Japan has been dissatisfied with the agreement because of its
"expectation" of U.S. and foreign share of the Japanese semiconductor market
reaching more than 20 percent. At a mid-term review in June, Japanese industry
officials reportedly had sought to terminate the agreement. However, both the
United States and Japan would have had to agree to the termination. A U.S.
trade official in June said the United States had no plans for the pact's
early termination because it was working well with regard to expected further
gains and "design-ins," which integrate foreign chips into the early
development stages of Japanese users' projects.
"The United States has always been committed to the vigorous
implementation of the agreement for its full five-year term and thus, we are
very pleased with this joint decision," USTR Mickey Kantor said in a release.
He added that "strong efforts must continue to be made over the remaining two
years of the agreement to ensure that the arrangement achieves its goal of
gradual and steady improvement in market access across a wide range of
competitive products."
According to USTR's 1994 National Trade Estimate Report on Foreign Trade
Barriers, the 1991 agreement, calls for the following: "The arrangement
contains the U.S. industry's expectation of foreign market share reaching more
than twenty percent by the end of 1992. The twenty percent figure is
explicitly recognized by the Japanese government in the arrangement. The
arrangement also calls for 'steady and gradual' improvement in market access
over the duration of the arrangement, which expires in July 1996,"
In the fourth quarter of 1992, foreign semiconductor market share did
reach 20.2 percent, but it declined to 18.1 percent in the third quarter of
1993. Since then, it has risen to 20.7 percent in the first quarter of 1994,
unchanged from the previous quarter.
The current pact builds on a previous five-year semiconductor agreement
reached in 1986.
Antitrust
MITI CHIEF PROPOSES STRONGER JFTC TO EXPEDITE DEREGULATION
PROCESS
TOKYO--Japan's Minister of International Trade and Industry Ryutaro
Hashimoto July 26 proposed reinforcing the Japan Fair Trade Commission to
expedite the country's commitment to eliminate many government regulations.
According to government officials, Hashimoto said at a meeting after a
regular Cabinet conference July 26: "It is about time that we considered
[overhauling and strengthening] JFTC, including its organization, to get the
deregulation program going further."
Hashimoto recommended that JFTC be upgraded to the level of the National
Personnel Authority so that it can have enforcement power equivalent to
ministries, the officials said. Hashimoto then sought to implement his idea as
a priority item of the fiscal 1995 budget.
In response, Tsuruo Yamaguchi, director-general of the Management and
Coordination Agency, which is in charge of the deregulation program, said he
will "give serious thought" to Hashimoto's proposal, according to the
officials.
Finance Minister Masayoshi Takemura endorsed Hashimoto's idea, saying
that he is telling bureaucrats to cooperate with the new administration's
policy.
Whether Hashimoto's proposal will succeed will become clearer later
this summer when the government completes preparing the fiscal 1995 budget
outline.
JFTC has a staff of less than 600 and has only one bureau. Its chairman,
by tradition, has been sent from the Ministry of Finance. The present JFTC
chairman, Masami Kogayu, served as vice minister of finance.
The United States and the European Union have been urging the Japanese
government to enlarge the staff to reinforce JFTC's investigation and
examination capabilities. In response, Japan has been increasing JFTC manpower
while basically freezing increases in other government offices under the
ongoing program to reduce government personnel.
Hashimoto is a key policy planner of the new coalition government of
Prime Minister Tomiichi Murayama. A former finance minister, Hashimoto was
known as a "man of action." He ordered the reluctant Ministry of Finance to
ease monetary policy and inject funds into the banking system after the
"Black Monday" financial crisis in October 1987, sources said.
Hashimoto's key advisers include former Prime Minister Noboru Takeshita
and Makoto Utsumi, a former vice finance minister for international affairs.
Securities
NFA CHAIRMAN SAYS CAMPAIGN AGAINST FRAUD, ABUSE WORKING
The National Futures Association's campaign against fraud and abuse is
working, the self-regulatory organization's chairman said July 26, pointing to
a decline in the number of firms subject to the NFA's "telemarketing
profile" rule.
Hal Hansen, NFA chairman, speaking at a media briefing, said the NFA also
has seen a substantial decline since 1988 in customer complaints and demands
for NFA arbitration and Commodity Futures Trading Commission reparations
proceedings.
Hansen explained that the NFA is reporting the progress it has made in
curbing fraud and abuse in the futures market to demonstrate that something
"positive" is being done in the derivatives market, as far as
exchange-traded instruments are concerned.
'Problem Brokers'
While much attention has been focused recently on so-called "problem
brokers" in the securities industry, Hansen said, the NFA identified the
problem in the commodities industry "sometime ago." In response, in 1993 the
NFA came up with a "telemarketing profile" rule, applicable to all firms
having 25 percent or more brokers on their sales force who were once employed
at firms that were closed for telemarketing fraud, Hansen explained.
According to an NFA summary, the rule requires such firms to institute
certain internal oversight procedures. The most important of these, it said,
is a requirement that the firms tape all telephone sales solicitations of new
customers by its associated persons for at least one year. The tapes must be
kept for at least six months, and the firms must provide NFA access to the
taping systems and tapes, if requested.
Since the rule went into effect in January 1993, Hansen said, the number of
firms subject to it have dropped from 22 to 12. "That is what we call
results," he stated.
While NFA's vice president and general counsel, Dan Roth, said that several
of the firms "chose to go out of business rather than tape-record their sales
solicitations," he estimated that three or four of the 10 firms changed the
composition of their sales forces so that they no longer fit the rule's
criteria.
Complaints, Arbitration, Mediation
Further proof of NFA's anti-fraud campaign success can be found in the
marked decline in customer complaints over the past six years, Hansen advised.
While 475 customer complaints were lodged with the NFA in 1988, and 92 in
1993, only 33 complaints have been received by the association's compliance
department this year, he said.
NFA has also observed a decrease in the number of customer demands for NFA
arbitration and CFTC reparations proceedings, Hansen said. While 835 were
filed in 1988, only 385 cases were brought in 1993, he said.
Hansen pointed out, however, that the "real future of dispute resolution
in the futures industry is mediation." Since 1991, when NFA first offered
mediation as a dispute resolution mechanism, Hansen said, it has handled
almost 500 cases, two-thirds of which were settled "without the cost and
delay of going to an arbitration hearing."
Warning
The NFA's attitude remains "one of 'zero tolerance' when it comes to
fraud and abuse," Hansen advised. He warned that "swindlers" will be
"hunted down and stopped."
Nonetheless, the chairman also issued a warning to investors, especially
small investors, to look out for potential abuses that may arise in the
commodities market, given the "recent revival of interest" in that market.
"Investors should be particularly leery of offers of off-exchange commodities
and futures contracts that are supposedly being traded on overseas exchanges.
which may or may not exist," he said.
Derivatives Bills
In other comments, Hansen said the NFA is not officially taking any stand
on any of the several proposed derivatives bills (HR 4503 HR 4745, S 2291).
The association, however, does believe the public may be under the
misconception that the concerns raised in the press regarding over-the-counter
derivatives apply to instruments traded on exchanges as well, the chairman
advised.
In this respect, Hansen said the NFA is reporting the progress it has made
in curbing fraud and abuse in the futures market because it is important that
the public realize that there is something "good and positive going on in
this area."
Because there has been heightened publicity about the potential problems in
the off-exchange derivatives market, Hansen said, "we want to make certain
that there's no confusion between that and the exchange-traded futures and
options business, where there is a mechanism very clearly in place to prevent
and deal with abuse and fraud
Banking
FED APPROVES FINAL, PROPOSED RULES TO REMOVE ANTI-TYING
RESTRICTIONS
The Federal Reserve Board July 27 approved final and proposed changes to
Regulation Y that remove several anti-tying restrictions for bank holding
companies, their affiliates, and non-bank subsidiaries.
In one action, the board agreed to finalize a rule it proposed in March
that expands to all bank holding companies an exemption from anti-tying rules
recently granted to First Union Corp., Charlotte, N.C. (46 DER A-14,
3/10/94).
In another, the board agreed to seek comment on a proposal that would
benefit non-bank subsidiaries of bank holding companies.
"Tying" occurs when an institution offers a discount on one product
conditioned on the purchase of another, or when it lets a customer buy one
product only if they also agree to buy another. This practice generally is
prohibited by the Bank Holding Company Act, but the Fed is allowed to grant
certain exceptions.
Under the final rule, the Fed would let a bank or bank holding company
offer for the first time a discount on brokerage services to customers who get
a traditional bank product--a loan, discount, deposit, or trust service-from
any affiliate.
Like the exemption initially granted to First Union, the exception is
only available if the brokerage services and traditional bank products offered
in the arrangement are separately available for the customer to buy.
According to Fed staff, those who commented on this provision
overwhelmingly favored it, saying it would promote fair competition with
non-bank competitors and save customers money.
The final rule also grants another exemption from anti-tying restrictions
that lets banks or bank holding companies offer a discount on a traditional
bank product to customers who get another such product from an affiliate.
This will essentially let customers negotiate the price of multiple
banking services on the basis of his or her entire relationship with a bank
holding company organization, instead of just a single bank within that
organization, Fed staff noted at an open board meeting in Washington.
The Fed declined to extend this exception beyond cases where only
traditional bank products are part of the package, as some commentators had
urged, staff added.
Expanding Exemption To Non-Banks
Instead, the board decided to seek comment on a proposed rule to except
tying between non-banks, provided the products are made available separately.
Specifically, the proposal would let bank holding companies and their
non-banking subsidiaries offer discounts on packaged products when no
affiliated bank is involved in the agreement, and the tying and tied products
are sold separately.
The exception would not apply if the package arrangement involved a
product offered by an affiliated bank.
"The inability of non-banks in a holding company structure to offer
discounts not only diminishes their competitiveness but also deprives their
customers of an opportunity to receive discounts," staff said.
After considering anti-trust concerns, Fed staff also said they think
neither BHCs nor their non-bank subsidiaries seem to have enough market power
in the products they offer to impair competition.
Several other protections are already in place anyway to thwart the
potential for anti-competitive behavior, including restrictions in the Clayton
Act and the Sherman Act, the Fed said. The agency also would keep regulating
tying by a non-bank when the tied product is offered by an affiliate. The Fed
board further has authority to kill or change any exception that results in
anti-competitive practices, and it requested that this be amplified in the
proposed rule.
Separately, Fed staff also said they would ask the board later to address
questions about ties involving bank-sold mutual funds and whether they are
either wholly or partially exempt from Section 106 of the Bank Holding Company
Act.
Health Care
TESTIMONY HIGHLIGHTS NEED FOR BALANCE BETWEEN DRUG COVERAGE,
COST CONTAINMENT
Exchanges between a Senate panel and a pharmaceutical industry
representative July 27 highlighted the difficulty Congress will face as it
tries to balance including prescription drug coverage in health reform
legislation with implementing mechanisms to restrain rising drug costs.
At a hearing of the Committee on Governmental Affairs, senators
specifically questioned witnesses on the findings of two GAO reports that
concluded that prescription drugs cost more in the United States than in other
developed countries. According to the reports, which were released in January
and May, manufacturers of brand-name drugs charge more for drugs sold in the
United States than they charge for drugs sold in Canada and some European
countries. The reports also found a positive relationship between the level of
prescription drug prices and drug firm expenditures on research and
development.
Gerald J. Mossinghoff, president of the Pharmaceutical Research and
Manufacturers of America, characterized the reports as "snapshots in time"
that do not adequately reflect the true situation in international drug
pricing, and he cited other reports that he said indicated that drugs do not
always cost more in the United States than they do in other countries, when
fluctuating exchange rates and different comparison measures are factored into
the equation. He also referred to a Congressional Budget Office report
released in June that found that while the Clinton administration's proposed
health reform plan would not affect seriously overall R & D, it may reduce
incentives for some firms to develop drugs for the Medicare population.
Mossinghoff told the panel that applying across the board in all markets
the exact prices of drugs sold in tightly government-regulated country markets
would kill pharmaceutical research and development worldwide.
Sen. David Pryor (D-Ark) responded that such a statement implies that U.S.
consumers who pay full price for their prescription drugs at retail pharmacies
-- particularly the Medicare population -- are subsidizing low drug prices for
the rest of the world. "You've got to become realistic about what is
happening here," Pryor told Mossinghoff. "I see nothing to indicate a
willingness on your part to help the American consumer."
"The question is not only why [Americans pay more] but is it fair?" Sen.
Byron Dorgan (D-ND) said. He continued, "Why the U.S.? Why our consumers? Why
are we stuck with higher prices?" He held up bottles of Premarin, Zantac,
Xanax, and Valium, all of which he said cost significantly more in the United
States than in Canada, the United Kingdom, and Sweden. For example, he noted
that a bottle of Premarin, the number-one selling drug in the United States in
1993, sells for $93 in Sweden, $100 in the United Kingdom, $113 in Canada, and
$297 in the United States.
Mossinghoff maintained that the indirect price controls being debated in
Congress would stifle future innovative drug research and that market forces
in the last few years already are causing a dramatic slowdown in drug price
increases.
International Trade
U.S. INDUSTRY REPRESENTATIVES OPPOSE ACCELERATED TARIFF
REMOVALS UNDER NAFTA
U.S. industry representatives and a U.S. congressman July 27 urged the
International Trade Commission to oppose the accelerated elimination of
tariffs in certain sectors under the North American Free Trade Agreement.
The ITC opened the investigation to provide advice on the effects of
accelerated tariff reductions. ITC findings are only advisory in nature.
The Office of the U.S. Trade Representative May 23 solicited comments on
tariff elimination acceleration under NAFTA. NAFTA calls for the elimination
of tariffs on goods traded between NAFTA partners within 15 years, according
to a specific timetable, but also provides for accelerating those eliminations
in negotiations with Canada and Mexico.
Rep. Peter Hoekstra (R-Mich) said that U.S. asparagus growers were
protected in the NAFTA talks by the placement of frozen and processed
asparagus in the slower tariff reduction categories. Opposing accelerated
elimination of tariffs on asparagus, Hoekstra said "[w]e're talking about
selling out the U.S. asparagus market to Mexican producers in exchange for
renegotiated market access in Mexico for other American industries."
Similarly, the Florida Fruit and Vegetable Association "strenuously"
objected to the accelerated elimination of tariffs on limes, mangoes, and
mangosteens, concentrated grapefruit juice, other citrus juice, and
concentrated fruit juice. Representing the association, attorney John M.
Himmelberg, Holland and Knight, Washington D.C., said that Florida growers
have made good faith business decisions based on the tariff schedule
negotiated. "Accelerating tariff schedules at this point is comparable to
changing the rules in the middle of the game," he asserted.
Fresh Rose Industry
"Nothing in the competitive relationship between the United States and
Mexico has changed in the six months since the implementation of NAFTA that
would make a commodity less import-sensitive, and, therefore, warranting a
more rapid tariff reduction. If anything, the competitive situation has
worsened," he added. The lime and mango industries are in a distressed
situation and any further tariff reductions will seriously harm them,
Himmelberg said.
Target Group Chief Operating Officer Philip Looby also opposed the
proposed accelerated elimination of tariffs on men's wool suits produced in
Canada and Mexico. Such accelerated elimination will greatly affect the
competitive ability of U.S. producers, he said. Cost advantages enjoyed by
Canadian and Mexican exporters will be multiplied if existing U.S. customs
duties are removed, Looby warned. The Target Group manufactures men's apparel
sold to national and regional department and speciality stores.
Floral Trade Council Executive Director William R. Carlson said that
nothing has changed in the fresh rose industry, since November of 1993 when
NAFTA was approved, to justify any acceleration of tariff removals from
Mexico.
International Trade
U.S., CANADA FAIL TO RESOLVE AGRICULTURE IMPASSE; AGREE TO
CONTINUE TALKS
While U.S. Trade Representative Mickey Kantor and Canadian International
Trade Minister Roy MacLaren July 27 did not announce any progress in morning
discussions on a long-simmering agricultural dispute, the trade officials
agreed that talks would continue.
The two sides are attempting to avert what could spiral into a
full-fledged trade war if the United States makes good on its threat to
restrict Canadian wheat.
"We will be in touch again
in the days ahead to make sure we
fully understand each other's approach
I don't know if I'll be meeting
with [Kantor], but I'll be talking with him on the phone," MacLaren told
reporters.
The United States has threatened to restrict Canadian wheat as early as
Aug. 1 if no resolution is reached. Canada, in turn, has vowed that any
unilateral U.S. action would not go unanswered.
MacLaren--who spoke to reporters at the Canadian Embassy after the
meeting--said it "remains to be seen" whether the two sides are any closer
to a settlement by Aug. 1. He described the talks with Kantor as "candid,"
saying that the two sides now understood each other's position better.
Asked whether restrictions would be placed on Canadian wheat by Aug. 1
as threatened, MacLaren commented: "I think you better ask the United
States."
The International Trade Commission sent sanction recommendations to the
president after a July 8 ITC ruling in which the commissioners found that
Canadian wheat imports interfered with the U.S. Department of Agriculture's
wheat program.
The ITC recommendations are merely advisory in nature. The president has
the final say on what, if any, sanctions will be imposed under Agricultural
Adjustment Act Section 22. Section 22 authorizes import restrictions if
imports impair or interfere with farm programs.
A USTR spokeswoman described the discussions as "friendly and frank."
MacLaren said that his discussions with Kantor touched on a "range of
issues," including the Uruguay Round of the General Agreement on Tariffs and
Trade. Canada welcomes the U.S. decision to move promptly on the Uruguay Round
implementing legislation, MacLaren said.
Derivatives
IOSCO ISSUES GUIDANCE TO REGULATORS ON FIRMS' DERIVATIVES
RISK MANAGEMENT
The Technical Committee of the International Organization of Securities
Commissions (IOSCO) July 27 issued guidance to regulators on eight specific
risk management control mechanisms for securities firms conducting
over-the-counter (OTC) derivatives activities.
The IOSCO document was issued at the same time as and in coordination with
the release of a similar document by the Basel Committee on Banking
Supervision, according to a joint news release by the CFTC and the SEC. The
Securities and Exchange Commission and the Commodity Futures Trading
Commission are members of IOSCO.
Derivatives are "financial instruments whose values are derived from, and
reflect changes in, the prices of the underlying products," according to the
background portion of the 25-page IOSCO paper. Further, derivatives "are
designed to facilitate the transfer and isolation of risk and may be used for
both risk transference and investment purposes," the paper states. It then
recognizes that these instruments "also may increase risk," including credit
risk, market risk, liquidity risk, settlement risk operations risk, and legal
risk.
Risk Management Control Mechanisms
The IOSCO paper--"Operational and Financial Risk Management Control
Mechanisms For Over-the- Counter Derivatives Activities of Regulated
Securities Firms"--presents eight risk management control mechanisms, as
follows, according to the joint release:
*
an established framework of risk management policies, procedures, and
controls;
*
market risk management functions independent of the trading function;
*
credit risk management functions independent of trading function;
*
in-house expertise and resources;
*
use of appropriate risk reduction techniques;
*
appropriate valuation and risk exposure measurement techniques;
*
systems to ensure adequate information and reporting, both internal
and external; and
*
appropriate funding and liquidity policies.
In addition, the paper includes an appendix concerning the role of
regulators in causing "firms subject to their regulatory jurisdiction to
develop control policies and procedures to meet the performance objectives set
forth" in the paper.
The guidance provided by the Technical Committee--"to securities
regulators (including self-regulators), intermediaries, and examiners of
intermediaries"-is intended to "provide a reference point concerning
procedures and controls that also may be relevant to effective risk management
by end-users," the paper states.
Further, the guidance is given on "a transnational basis" and advises
mechanisms that "should be integrated within a firm's overall risk management
framework." The paper cautions that risk management controls are "not a
substitute for adequate capital," however.
Non-Prescriptive Approach
The Technical Committee avoided a "prescriptive approach," according to
the document, because, among other reasons, such an approach "may
inadvertently hinder the market development of sophisticated control
practices, which are constantly evolving."
With an eye to the evolving nature of the derivatives market, the SEC told
Congress in May that for it has adequate means to regulate OTC derivatives.
SEC Chairman Arthur Levitt said at that time that he does not see any
immediate need for legislation to give the SEC jurisdiction over securities
firm or insurance company affiliates that deal in OTC derivatives.
The new IOSCO paper on managing the risks associated with OTC derivatives
activities represents a wide acceptance of the need for international
cooperation in this area. In a similar vein, in a joint statement issued March
15 by the SEC, the CFTC, and the U.K. Securities and Investments Board on the
same subject, those three regulators identified ways that they planned to
coordinate and enhance their regulation of over-the-counter derivatives.
However, the latest paper is the product of securities regulators worldwide
and was coordinated with a similar document addressed to the international
banking community.
International Trade
ADMINISTRATION FLEXIBLE ON FAST-TRACK ISSUE, YERXA SAYS
Deputy U.S. Trade Representative Rufus Yerxa July 27 said the
administration is willing to compromise on a seven-year extension for
fast-track authority for trade agreements contained in proposed administration
amendments to legislation implementing the Uruguay Round multilateral trade
agreement.
Yerxa testified before the Senate Finance Committee on administration
proposals regarding fast-track, ability to impose sanctions under Article
XXVIII of the General Agreement on Tariffs and Trade, renewal of the
Generalized System of Preferences, and equal treatment for textile and apparel
imposts from Caribbean countries with those from Mexico under the North
American Free Trade Agreement.
Fast track authority would be extended for seven years under the
administration's proposal, Yerxa said. If passed into law as part of the
Uruguay Round implementing legislation, it would grant the adminsitration
authority to enter into bilateral, regional or multilateral trade agreements,
he said. The proposal would require consultation with the Senate Finance
Committee before entering into agreements, he added.
Prior to trade talks, the administration would have to lay out before the
Finance Committee specific U.S. objectives in the negotiations, Yerxa said.
The proposal would establish a 120-day notification period, longer than the
90-day period under the last fast-track authority, he said. When fast-track
was extended for the Uruguay Round, the notification period was extended to
120 days, he added.
Objectives Include Labor, Environment
Under the proposal, the administration would have principal negotiating
objectives for services, financial services, foreign direct investment,
intellectual property, labor standards, trade and the environment and
transparency, Yerxa said.
"The objectives that are included concern some of the issues that must
still be addressed after the Uruguay Round, he said.
Yerxa called fast-track authority important for future trade liberalization
with other countries.
"We need broad authority to provide leadership in a rapidly changing and
competitive global economy," he said.
Sen. John Chaffee (R-R.I.), said he has "misgivings" about attaching the
fast-track proposal to legislation that is itself already on the fast-track.
While the Senate Finance Committee will have input into legislation that is on
the fast-track, other senators would not, he said.
In addition, the proposal does not specify what the fast track would be
used for, Chaffee said.
USTR General Counsel Ira Shapiro said the administration has a "specific
desire" to seek future trade opening deals in Latin America. Yerxa said the
administration was not specifying where because countries interested in making
trade deals with the United States must demonstrate commitments to open
markets before negotiation begins, he said.
Sen. Max Baucus (D-Mont) asked why the fast-track period was for seven
years, and suggested a two-year period might speed up the conclusion of trade
agreements by setting a near-term deadline.
"We're willing to talk to the committee about duration," Yerxa said.
There is some merit to the idea of deadlines, and countries in Latin America
interested in striking trade deals with the United States would likely seek a
fairly rapid pace, he said. Establishing deadlines and changing the duration
for fast-track are issues the administration would be willing to discuss, he
added.
GSP Reforms
Under the administration's GSP proposal, the current criteria for country
eligibility would be retained, Yerxa said. The program's "competitive need
limits" would be lowered, as would the threshold for graduating advanced
countries from GSP, he said.
The proposal would give the President the authority to grant expanded
benefits to least-developed countries in accordance with the Uruguay Round's
ministerial declaration concerning least-developed countries, Yerxa said. The
proposal also establishes clearer standards for the acceptance of GSP
petitions, improving the transparency and predictability of GSP programs, he
said.
Under the interim trade program for the Caribbean Basin, North American
Free Trade Agreement-like tariff and quota treatment would apply to imports
into the United States from Caribbean Basin Initiative beneficiary countries
for articles that meet NAFTA-like rules of origin, Yerxa said. CBI
beneficiaries would expand market access on an MFN basis on specific
textile/apparel products and would agree to the U.S. formulation on
anti-circumvention, he said. To benefit from the program, CBI countries would
have to agree to seek the standards in the the U.S. bilateral investment
treaty and in the U.S. prototype intellectual property agreement within two
years, he added.
Sen. Max Baucus called Article XXVIII "another arrow in our trade quiver
which enables us to address trade barriers." It would be used to address
situations such as Canadian exports to the United States of subsidized durum
wheat, he said. But Senators representing poultry producing states expressed
concern that use of Article XXVIII against Canada to settle a dispute over
durum wheat imports into the United States would trigger retaliation against
other U.S. agricultural products.
Sen. Kent Conrad (D-ND) said the administration would initiate a Section 22
case against Canada Aug. 1 if there is no negotiated settlement in the durum
wheat dispute.
Government Contracts
HOUSE PANEL, DOD WORKING TO CRAFT BILL LANGUAGE ON
RESTRUCTURING COSTS
House Armed Services Oversight and Investigations Subcommittee staff and
Defense Department officials are attempting to craft compromise language to be
included in the fiscal 1995 defense authorization bill (S 2182), which would
allow DOD to pay at least some restructuring costs associated with defense
contractor mergers and acquisitions.
However, whether or not the efforts will succeed is uncertain. At least
some committee members oppose allowing any restructuring costs. Moreover, the
Senate Armed Services Committee has not weighed in on the issue yet.
The Senate version of the defense bill is silent on restructuring costs,
and an Armed Service committee staffer said that the Senate's views on the
issue remain unknown.
The House-Senate conference on the defense bill has not yet been
scheduled, although meetings have been held at the staff level. Time is short;
the conference is supposed to be completed before Congress recesses later this
month.
Three alternative courses of action are possible:
*
House conferees could push in conference to retain Section 1033 of
the House version of the bill, which prohibits DOD from paying such costs.
*
The committee could go ahead with an amendment deleting Section
1033, which would leave in effect a DOD policy allowing payment of such costs
where the merger will result in a net savings to DOD or will preserve a
critical capability in the industrial base.
*
The committee amendment could include in the bill compromise
language which places some restrictions on the DOD policy of allowing such
costs.
During a July 27 hearing on the allowability of restructuring costs,
Subcommittee Chairman Norman Sisisky (D-Va) stressed that the subcommittee's
interest is in saving the government and the taxpayer money. The issue could
involve billions of taxpayer dollars over the next few years, he noted. The
subcommittee is examining what DOD's policy should be, how policy in this
difficult area should be implemented--for example, how to measure "savings"
next year and attribute it to a "cost" this year--without a legislative
request or going through the standard regulatory process. Sisisky is expected
to be one of the House conferees on the defense bill.
In July 1993, Deputy Secretary of Defense (then-Under Secretary of Defense
for Acquisition and Technology) John M. Deutch issued an internal memorandum
stating that it was DOD's policy to allow restructuring costs if the
merger/acquisition is expected to result in overall reduced costs to DOD, or
if it is expected to preserve a critical capability. Testifying before
Sisisky's panel, Deutch committed DOD staff to working with the subcommittee
to address members' concerns regarding its implementation.
Deutch, agreeing that savings to the taxpayer is the "central and only
test" as to the validity of the policy, told the panel that while there are
no estimates of either the overall cost or savings to result from DOD's
policy, based on data so far, the projected savings range from
one-and-one-half to seven times the projected costs.
Martin Marietta Chairman and Chief Executive Officer Norman Augustine
endorsed DOD's current policy of allowing restructuring costs, and warned that
Section 1033, if enacted, would delay or prevent needed defense restructuring
and cause DOD to bear unnecessary costs. To address congressional reservations
about the DOD policy, he suggested that "controls" could be adopted to:
*
State expressly that the costs of the acquisition itself--as opposed
to the restructuring--are not allowable costs under government contracts.
*
Require that contracts be novated timely after a merger or
acquisition.
*
Require advance agreements--including cost caps--as a condition for
government payment of restructuring costs.
*
Require full audit of costs and savings from the transaction.
*
Authorize the government to reject any proposed restructuring
project.
*
Require that the transaction produce net savings to the government
and that the government pay no restructuring costs until the savings are
documented.
However, Lawrence J. Korb, former assistant secretary of defense and now
senior fellow at the Brookings Institute, strongly supported Section 1033. DOD
and the taxpayer should not be subsidizing the defense industry, and such
subsidization is not necessary to promote mergers and acquisitions, he said.
He also criticized the process by which DOD allowed contractors to recover the
costs of restructuring, treating it as a policy clarification rather than a
policy change.
Korb maintained that the policy on restructuring costs cannot be worked out
in several afternoons of discussion between congressional and DOD staffs, and
called for the establishment of a commission to review the issue and make
recommendations, much like the base closure commission.
David E. Cooper, of the General Accounting Office, cautioned that the
dollar impact of the policy is unknown, and that the Defense Contract Audit
Agency and contracting officers have expressed concerns that contractors have
been reluctant to estimate potential savings resulting from corporate
restructuring.
Hazardous Waste
OIL RECOVERED FROM REFINERY OPERATIONS EXEMPTED FROM
SUBTITLE C UNDER FINAL RULE
Certain oil recovered from petroleum refinery operations, or from
petroleum exploration or production, is exempt from hazardous waste regulation
under Subtitle C of the Resource Conservation and Recovery Act, according to a
final rule scheduled for publication in the July 28 Federal Register.
The Environmental Protection Agency rule would exempt from the RCRA
definition of solid waste recovered oil that is returned to the refining
process. EPA said such oil and its management within refining operations are
viewed as part of the petroleum refining process and not "part of the waste
disposal problem."
Most recovered oil affected by the rule will be generated from waste water
treatment operations, the agency said. The agency did not exempt from
hazardous waste regulation the waste water itself.
A waste must qualify as a solid waste to be regulated under RCRA hazardous
waste provisions. Federal court rulings have specified that materials that are
part of an ongoing industrial process and not "part of the waste disposal
problem" should not be considered solid wastes, and thus should not be
regulated as hazardous wastes (American Mining Congress V. EPA (AMC I), 824
F2d, 1177, 26 ERC 1345, CA DC, 1987; American Mining Congress V. EPA (AMC II),
907 F2d 1179, 31 ERC 1935, CA DC 1990).
The rule is effective immediately. It makes final portions of a proposed
rule that would implement the AMC I opinion (53 FR 519). The proposal included
various proposed amendments to the definition of solid waste, including
exemptions for secondary materials associated with "ongoing fuel production
activities
in which crude oil is refined and oil-bearing residues from
the refinery process are returned for further refining as part of a continuous
and on-going process."
According to the final rule, EPA proposed to exclude from Subtitle C
regulation oil-bearing residues from the refining process when those residues
are generated on-site and inserted into that on-site petroleum refining
process or coker, "provided that these residues are not managed as if they
had been discarded such as placement in a disposal unit."
Similarly, the final rule excludes from the regulatory definition of solid
waste recovered oil from petroleum refinery operations, petroleum exploration
and production, and transportation incident thereto if it is subsequently
inserted into the petroleum refining process. But in what the agency termed a
"potentially significant expansion of the proposal," the recovered oil would
not have to be generated at the site of the refining process to be exempted.
However, the agency said it also is narrowing the proposal, which would
have excluded the waste waters containing oil that eventually gets recycled.
According to the agency, refinery operations upstream of recovered oil systems
involve waste water treatment, not an ongoing refining process. But the agency
went on to say that once the oil is recovered from the waste water, it may be
exempt from hazardous waste regulation if the oil is to be used in the
refining process.
The agency stated that persons claiming their recovered oil is excluded
from the definition of solid waste "bear the burden of proof in enforcement
actions to demonstrate that they qualify for the exclusion."
Materials Not Excluded
EPA stressed that it is not extending the regulatory exclusion to
recovered oil from non-petroleum industries. Such an exclusion would be beyond
the scope of the proposed rule and judicial decisions, EPA said. "These
[judicial] decisions indicate that when one industry sends its residual
materials to another industry for recycling, the initial industry can be
considered to have discarded them."
In addition, the final rule said the agency is studying the issue under the
Definition of Solid Waste Task Force and "is not at a point where it is in a
position to make a final determination."
EPA did not finalize its proposed exclusion of recovered oil that is
converted to petroleum coke. The agency said it deferred the exclusion
"because EPA lacks data assuring that hazardous constituents from petroleum
refining do not end up in the product in quantities that, when such product is
used as a fuel, could be harmful to human health or the environment."
The rule also does not exclude hazardous sludges or similar waste from
regulation. Distinguishing such wastes from recovered oil can be difficult,
EPA said. Factors the agency will use to make such distinctions include water
content, solids content, and metals content.
Officials from EPA's Office of Solid Waste were unavailable for comment on
the final rule July 27. Officials from the American Petroleum Institute also
were unavailable for comment.
Additional background on the final rule can be obtained from the
RCRA/superfund hotline (800) 424-9346 or (703) 412-9810 in the Washington
area. Specific information on the rule can be obtained from Ross Elliott, EPA
Office of Solid Waste, (202) 260-8551.
Environment
ACCORD REACHED ON DRINKING WATER BILL; MARKUP SLATED FOR AUG.
3 BY HOUSE PANEL
Negotiators for the House Energy and Commerce Committee have reached a
tentative agreement on standard-setting provisions in a bill to reauthorize
the Safe Drinking Water Act, a congressional aide told BNA July 27.
The bill, which has the support of two leading members of the panel, has
been scheduled for markup by the committee Aug. 3, the aide said.
Other issues remain unresolved, but the standard-setting issue was
considered the most contentious, according to the aide, who declined to
provide further details of the agreement.
Supporting the measure are Rep. John D. Dingell (D-Mich), committee
chairman, and Rep. Henry A. Waxman (D-Calif), chairman of the House Energy and
Commerce Subcommittee on Health and Environment. The bill, not yet numbered,
may be introduced as a substitute for one of two opposing bills already
introduced, the aide said.
One measure (HR 3392), was introduced Oct. 27, 1993, by Reps. Jim Slattery
(D-Kan) and Thomas J. Bliley (R-Va). Favored by a coalition of state and local
officials and water utilities, the bill seeks to relax standards for
regulating water contaminants and to give the Environmental Protection Agency
more flexibility in regulating contaminants.
The measure also would provide regulatory relief for small water systems.
It is opposed by most environmental groups.
Another bill (HR 4314), introduced April 28 by Reps. Blanche Lambert
(D-Ark), Gerry E. Studds (D-Mass), and Michael L. Synar (D-Okla), is a more
comprehensive bill.
The measure addresses state revolving loan funds, source water protection,
funding for state programs, viability of small systems, sanitary surveys, and
regulation of the contaminant cryptosporidium.
The bill also would change the process for selecting regulated contaminants
by eliminating a current requirement that EPA target 25 new contaminants every
three years. Instead, EPA would be required to select for regulation
contaminants that pose the greatest danger to public health.
The Senate already has passed a reauthorization bill 2019) that would
make major changes to the existing Safe Drinking Water Act.
Approved May 19, the bill, among other things, would establish revolving
loan funds to help states pay for system improvements to comply with federal
law, eliminate the "25 contaminants every three years" rule, and replace
that regulation with a requirement that EPA regulate contaminants based on
risk and frequency of occurrence.
International Trade
CLINTON FACES JULY 31 TRADE DEADLINE ON JAPAN TRADE; NO
MOVEMENT DETECTED
After twice delaying a decision about whether to cite Japan under U.S.
trade law for discriminating against U.S. firms in government procurements,
the Clinton administration faces another deadline July 31, with no movement
yet seen from Japan to stave off U.S. retaliation.
Asked about the state of trade differences leading up to the latest
deadline for Japan under Title VII of the Omnibus Trade and Competitiveness
Act of 1988, Robert Rubin, assistant to the president for economic policy,
suggested July 27 there has been nothing new coming out of Japan's coalition
government.
"We are very anxious to press forward," Rubin said, referring to
efforts by the administration to reach agreement with Japan on opening its
markets to U.S. goods and services. "We are ready at any moment to press
forward in any way that might bear fruit."
Speaking to reporters, Rubin suggested the Clinton administration was
energetically negotiating with the Japanese on trade, and making some strides,
before political upheaval resulted in the resignation of Prime Minister
Tsutomu Hata and the selection of Socialist Tomiichi Murayama as his successor
in June. "We were able to clarify our misunderstandings in May," Rubin told
reporters.
President Clinton met Murayama for the first time this month at the
Group of Seven economic summit in Naples, Italy. The two leaders, as well as
their trade representatives, achieved no new breakthroughs on trade at the
summit, but the administration embraced Murayama's reassurances that his
government will honor all previously existing agreements on foreign policy,
including the framework trade agreement reached with the United States a year
ago.
The new prime minister promised to continue meeting at least twice a
year with the United States on the framework issues, which set as their goal a
reduction of Japan's approximately $130 billion global current account
surplus. At the summit, Treasury Secretary Lloyd Bentsen characterized the
framework progress to date as "disappointing," while the president said
Japan has not made sufficient progress (130 DER A-15, 7/11/94).
Administration officials suggested in Naples that they were prepared to
give Murayama a grace period as he installs the new government in Japan, but
no one put a deadline on how long the adjustment period should stretch.
The normal deadline for Title VII is April 30. At that time, Kantor
cited negotiations with Japan under the economic framework talks as a reason
for postponing citation of Japan. When that deadline expired June 30, Kantor
gave turmoil in the Japanese government as a reason for extending the deadline
a second time.
Environment
UTAH, COMPANY ASK U.S. SUPREME COURT TO EYE COURT ROLE IN
SUPERFUND SETTLEMENT
Utah and a company allegedly liable for natural resource damages under the
federal superfund law have asked the U.S. Supreme Court to decide whether they
can appeal a federal district court's refusal to approve their settlement
agreement (Utah v. Salt Lake County Water Conservancy District, US
SupCt, No. 94-147, 7/25/94).
The U.S. District Court for the District of Utah found the settlement
between Utah and Kennecott Corp. insufficient and refused to approve it
(Utah v. Kennecott Corp., 801 F.Supp. 553, 35 ERC 1734, 1992).
The U.S. Court of Appeals for the Tenth Circuit ruled it did not have
jurisdiction to hear an appeal because the decision was not a final ruling on
the merits (14 F.3d 1489, 38 ERC 1056, 1994).
In seeking Supreme Court review of the case, the petitioners said the high
court has not yet decided whether settlements grounded in public policy and
encouraged by the Comprehensive Environmental Response, Compensation, and
Liability Act are important enough for immediate appeal.
Government Contracts
POOR CONTRACTOR FINANCIAL CONTROLS MAY RESULT IN COST GROWTH,
DCAA SAYS
A Defense Contract Audit Agency official told a House Energy and Commerce
panel July 27 that the required NASA contractor financial management reporting
system and contractors' budgetary and financial control systems reports do not
effectively identify or prevent cost growth.
DCAA Assistant Director Policy and Plans Michael J. Thibault told the
Energy Committee's Oversight and Investigations Subcommittee that without
adequate budgetary systems, contractor cost performance cannot be accurately
determined, nor can contract cost growth be identified soon enough to allow
the space agency to take corrective measures.
"We believe that there is significant financial risk to NASA Johnson Space
Center programs, if contractors' budget and financial control systems, and the
related contractor reporting on NASA Form 533, are left unchanged," Thibault
observed.
Thibault said budgeting and financial control audits of ten major NASA
Johnson Space Center contractors, including three current or one time space
station contractors, Boeing Aerospace Operations Co., McDonnell Douglas Corp.
and International Business Machines Corp., revealed that:
*
Contractors do not perform a bottom up estimate-to-completion--often
using the available funding as an ETC--although a detailed ETC based on
documented percentage of completion analysis on major worktasks is
contractually required under old and new space station contracts.
*
Contractors do not analyze or explain cost overruns through techniques
such as detailed variance analysis. Generally, contractors provide only
summary explanations in NASA reports which do not provide sufficient
information to determine the cause of the overruns and allow for corrective
action.
* Contractors do not accurately report contract value or baselines.
Contractors are commingling authorized, negotiated contract baseline with
undefinitized cost estimates which are not adequately supported or are not
authorized in some instances.
* Contractors do not obtain prior written authorization from the
contacting officer for some costs.
* Contractors do not have internal controls to effectively monitor and
prevent inefficiencies at contract worktask levels or to reduce or prevent
unnecessary or unreasonable costs from being incurred. Contractors also do not
perform adequate reviews of staffing or utilization of equipment and
facilities.
Committee Chair John Dingell (D-Mich), who called the hearing to examine
the adequacy of NASA contractors' financial and management controls and NASA's
oversight of its contractors, charged that NASA had been "asleep at the
switch," while several large defense contractors working on the space station
project were out of control.
Audits by the General Accounting Office, the NASA inspector general, and
DCAA show that contractors routinely submitted incomplete and inaccurate cost
reports essential for monitoring and controlling costs.
Further, Dingell said that NASA cannot answer fundamental questions about
the costs of projects such as the space station because it did not require its
contractors to follow cost reporting guidelines.
Dingell pointed out that the space station program has cost over $11
billion so far with nothing built. The House has agreed to authorize $2.1
billion for the program in fiscal 1995.
Hazardous Waste
SWIFT SAYS DEADLINE LOOMS FOR SUBMISSION OF ALTERNATIVE
PROPOSAL ON COMBUSTION ASH
Rep. Al Swift (D-Wash) said July 27 that interest groups must submit a
legislative proposal for regulation of municipal solid waste incinerator ash
to Capitol Hill by July 29 to allow time for consideration during the 103rd
Congress.
The House Energy and Commerce Subcommittee on Transportation and
Hazardous Materials held a hearing on regulation of ash generated by
incineration of municipal solid waste.
The hearing also focused on a bill (HR 2654) introduced by Rep. Bill
Sarpalius (D-Texas) that would exempt certain small communities from ground
water monitoring requirements.
Concerns about both issues arose following recent court rulings.
The U.S. Supreme Court ruled in May that municipal solid waste combustion
ash should be tested for hazardous waste characteristics (Chicago V.
Environmental Defense Fund, US SupCt, No.92-1639, 5/2/94).
In addition, the U.S. Court of Appeals for the District of Columbia ruled
in May 1993 that ground water monitoring requirements in EPA municipal solid
waste regulations applied to all municipal landfills, not just larger ones
(Sierra Club v. EPA, CA DC, No. 92-1003, 5/7/93).
"This is a very bad way to make policy," Swift said. He said the court
rulings force Congress to deal with each of these respective issues "quickly
and out of context," rather than through a comprehensive reauthorization of
the Resource Conservation and Recovery Act.
Consensus Plan Being Developed
Swift urged the Environmental Defense Fund and the waste management
industry to rapidly complete their proposal, which according to earlier
descriptions would create a special regulatory niche for municipal solid waste
incinerator ash (116 DER A-19, 6/20/94).
"There is no sense in arriving at the station with a package after the
train has gone," Swift said. He noted that the committee is slated to hold
its last markup in the 103rd Congress Aug. 9.
The consensus proposal would be offered as an alternative to an EPA plan
for implementing the Supreme Court ruling. The EPA plan would require testing
and treatment to eliminate hazardous characteristics, or disposal in hazardous
waste landfills. Stringent land disposal restrictions would have to be
developed.
The alternative plan would be to forego all sampling and testing of ash
and create a special waste category for all ash generated from the
incineration of municipal solid waste. Ash would be disposed of in a dedicated
landfill or in dedicated space in a landfill, but would not be called a
hazardous waste.
Margaret Ann Charles, director of state programs and policy for the
Integrated Waste Services Association, told BNA July 27 that individuals who
wish to see the compromise proposal move forward as legislation this year
should take Swift's advice to heart.
Peter Robertson, deputy administrator for the EPA Office of Solid Waste
and Emergency Response, said his agency would be willing to work with the
various groups and the subcommittee to move legislation forward.
He said EPA also would be taking several administrative steps in response
to the Supreme Court ruling, including:
*
Development of final guidance on sampling and analysis of municipal
solid waste incinerator ash;
*
Promulgation of land disposal restriction standards for treatment of
hazardous ash prior to land disposal; and
*
Preparation of implementation guidelines that would address many
questions EPA has received regarding regulation of municipal solid waste ash.
Ground Water Bill Also A Focus
Sarpalius, in testimony, urged the panel to support his bill, which would
authorize EPA to exempt certain landfills from ground water monitoring
requirements.
"This legislation is aimed at keeping small landfills open without
landfill owners having to go into debt by complying with the ground water
monitoring regulations," he said.
He said the bill would reinstate EPA authority to exempt small landfills
from ground water monitoring requirements if the facility:
*
Accepts less than 20 tons of waste per day;
*
Exhibits no evidence of ground water contamination; and either
*
Serves a community that experiences interruption of surface
transportation for at least three consecutive months each year; or
*
Is located in an area that annually receives 25 inches or less of
precipitation.
Robertson said while EPA supports the intent of the Sarpalius legislation,
it would be able to accomplish the same goals through administrative measures.
He said EPA still has authority to develop alternative, cost-effective
monitoring requirements for small communities.
As an example, he said, communities could use soil moisture detection
devices instead of ground water detection wells. He said implementation of
such a detection systems might cost a 10-ton per day landfill $1,000, and
would impose only minimal annual costs.
He acknowledged that even the most inexpensive ground water monitoring
requirements would present an economic challenge in extremely rural areas of
the country.
Monitoring Costs Too High, Communities Say
Several representatives of small communities said the costs of ground
water monitoring are too high for many areas with low populations. Each voiced
support for the Sarpalius bill.
"Charging fees to cover the cost of operating a landfill in full
compliance with federal regulations would, in many cases, merely result in
illegal dumping elsewhere," Heather Stockard, chief of the Alaska Department
of Environmental Conservation solid and hazardous waste management section,
said.
She said many small Native Alaskan communities lack even basic sanitation
facilities. Requiring ground water monitoring of landfills or dump sites in
such locations seems unrealistic, she said.
Peggy Garner, commissioner of the Texas Natural Resource Conservation
Commission, said ground water monitoring and other environmental requirements
have resulted in increases in illegal dumping.
Environmentalist Stresses Need For Monitoring
Lisa Kahn, a policy associate with the ground water project at Friends of
the Earth, stressed the need for ground water monitoring at municipal
landfills.
"We must learn from past mistakes, and not simply pretend that leachate
contamination will not occur in certain parts of the country," she said.
She said communities that have difficulty meeting ground water monitoring
costs would have an even tougher time paying for the cleanup of contamination.
Other witnesses at the hearing included: Thomas Eaton, program manager for
the State of Washington Department of Ecology hazardous waste and toxics
reduction program; Bob Deavenport, county judge for Martin County, Texas; and
John Tobert, executive director of the Kansas Association of Counties.
Health Care
HOUSE PANEL ADOPTS FRAUD/ABUSE, HEALTH DATA PROVISIONS TO
REFORM PLAN
The House Government Operations Committee July 27 voted to report out
portions of the Clinton administration's health care plan (HR 3600) dealing
with health care information practices and fraud and abuse procedures.
Committee Chairman John Conyers Jr. (D-Mich) said experts had told the
committee that fraud and abuse within the health care system cost about $100
billion annually, which represents about 10 percent of the $1 trillion spent
nationally on health care.
As the basis of its activity, the committee used sections of the Clinton
legislation marked up at subcommittee hearings that took place earlier July
27. The Information, Justice, Transportation and Agriculture Subcommittee
addressed issues in Part 2, Subtitle B of Title V of the Clinton plan and the
Human Resources and Intergovernmental Relations Subcommittee marked up Section
5401, Title V.
By voice vote, the full committee accepted Section 5401, Title V, as
amended by the Human Resources panel. Subcommittee Chairman Edolphus Towns
(D-NY) said the amended section would have a three- pronged effect.
Promote Coordination
The amended section would promote coordination between federal and state
law enforcement agencies by requiring the inspector general of the Health and
Human Services Department and U.S. attorney general to establish a program to
coordinate and review the activities of state, federal, and local law
enforcement agencies. Once the program is set up, Towns said, IGs within the
Defense, Labor, and Veterans Affairs departments would submit investigative
plans to the HHS IG for review.
To further improve inter-agency communication and coordination, the
governors of each state would be required to designate a lead agency to deal
with fraud and abuse and these lead agencies also would submit plans to HHS.
As revised by the subcommittee, Section 5401 would require the IG and the
attorney general to set up a program for data sharing between federal, state,
and local law enforcement agencies, health care providers, and insurers, Towns
said.
Finally, the amended section provides for a Health Care Fraud and Abuse
Enforcement Account to supplement appropriations and to cover investigative
expenses incurred by the IGs and agencies. According to Towns, fines and
forfeitures and proceeds from seizures related to health care fraud and abuse,
civil penalties for false claims, and administrative penalties imposed under
the Social Security Act would be deposited in the enforcement accounts. Funds
from the account would be allocated by the IG and attorney general according
to recommendations made by an advisory board.
Towns emphasized that the changes proposed by the subcommittee were
designed to offset reductions in staff and funding at HHS, which is "moving
in the wrong direction" by closing offices and eliminating jobs.
Fraudulent health care providers face a "slim" chance of being caught, he
said. "If caught, the chances of receiving any serious sanctions are even
more remote, so that health care fraud pays. We must change this equation,"
Towns stated.
Although the subcommittee's recommendation for amending the section was
passed on a voice vote, Rep. C. Christopher Cox (R-Calif) offered a dissenting
viewpoint, opposing the reporting and performance requirements the section
would impose on governors and states.
Uniform Information Practices
The full committee also accepted Part 2, Subtitle B, of the Clinton plan
as amended by the Subcommittee for Information, Justice, Transportation and
Agriculture with changes. The subcommittee had voted to accept a version of
the Fair Health Information Practices Act (HR 4077) as a substitute to the
portion of HR 3600 that was in its jurisdiction.
According to Rep. Gary A. Condit (D-Calif), subcommittee chairman, the
subcommittee's substitute would provide a "uniform federal code of fair
information practices for individually identifiable health information that
originates or is used in the health treatment and payment process."
The code would ensure that health information for individuals is treated as
fairly as possible and according to well-defined rules designed to protect
individual confidentiality to the utmost degree possible, he said. The
subcommittee's amendment limited the disclosure of protected health data, set
up administrative, technical, and physical safeguards for health information,
and ensured consumers had a right to inspect, correct, and obtain a copy of
their medical records.
Condit called the fair information practices provisions offered by the
subcommittee as an amendment to sections of the Clinton plan "completely
neutral" since they would fit into and complement any reform legislation,
whether it is the administration's plan or a single-payer alternative.
Protection In Case Of Failure
Towns proposed an amendment to the subcommittee-approved measure that
would require states to establish a process for maintaining and protecting
health records in the event a hospital, medical facility, or provider goes out
of business. The issue is one of continuity of care and quality, he said,
adding that while some states currently have laws outlining procedures for
dealing with medical records in the event a provider closes, others do not.
According to Towns, the amendment would only affect those states without
procedures to protect medical records in the event a business fails.
A proposal offered by Rep. Stephen Horn (R-Calif) to broaden Towns'
amendment to include federal hospitals was accepted without objection.
One final revision proposed by Rep. Craig Thomas (R-Wyo) to the
subcommittee's proposed substitute for Subtitle B would replace the
centralized, government operated data bank found in part 1 of the subtitle
with a provision that would encourage the development of a private sector
electronic data network.
The Thomas amendment would require the HHS secretary to adopt standards
developed by private standards setting organization, such as the American
National Standards Institute, and would repeal "quill and pen" laws that
require medical records be maintained in written format.
In addition, Thomas said his amendment would allow HHS to set up grants to
rural and urban underserved areas for the development of local electronic data
networks. The committee agreed to Thomas' amendment on a voice vote.
Environment
20 PERCENT OF U.S. RESIDENTS DRINK POORLY TREATED WATER,
NRDC REPORTS
One out of five U.S. residents drinks unsafe or poorly treated water,
according to a report released July 27 by the Natural Resources Defense
Council.
Such water is contaminated by unlawfully high levels of toxic chemicals,
microbes, and other pollutants, or is inadequately treated for these
substances, according to the report.
The report, Think Before You Drink: A 1992 and 1993 Update, analyzes 1992
and 1993 violations of the Safe Drinking Water Act.
NRDC found that violations have increased in the past year, based on
comparisons with its earlier study published in September 1993. Data used in
the report was obtained from notices of violations reported by utilities to
the states, which in turn reported the violations to the Environmental
Protection Agency, NRDC said.
"There is no reason why Americans should drink contaminated water," Erik
Olson, an NRDC attorney and author of the report, said at a briefing on the
report. "We know how to make water safe, and we know how to do it cheaply, at
a cost of about $25 per year for the vast majority of households. Compare that
to the cost of soda, or of bottled water for a year."
Although the SDWA is up for reauthorization this year, Olson said no bill
pending in Congress would correct the problems found by NRDC. Instead,
Congress is in the process of "weakening the law," according to an NRDC
statement.
A Senate bill (S 2019) passed May 19 would relax monitoring of water,
weaken health standards for cancer-causing chemicals, and loosen protections
for small and medium-sized systems, the report said.
According to NRDC, a House measure (HR 3392) introduced by Reps. Jim
Slattery (D-Kan) and Thomas J. Bliley (R-Va) would "even more severely gut
the Safe Drinking Water law."
NRDC called a bill (HR 4314) introduced by Reps. Blanche Lambert (D-Ark),
Michael L. Synar (D-Okla), and Gerry E. Studds (D-Mass) "more moderate."
Potentially Unsafe Water
Among the major findings of the report were:
*
About one in five U.S. residents, or 49.8 million people, drank water
from systems in 1992-93 that were more contaminated than the law allows, or
that did not properly treat water supplies;
*
Of the 49.8 million people, 36.4 million drank water that was more
contaminated than health standards allow; and
* Overall, 116 million Americans drank water from systems that violated
the law because of breaches of health standards, or treatment, testing, and
reporting rules.
According to the report, these numbers probably "grossly underestimate"
the actual number of violations because 24 states and territories failed to
submit complete reports, omitting whole classes of contaminants.
Pollutants found through the analysis of Environmental Protection Agency
records with highest public exposure included coliform bacteria,
trihalomethanes, radioactive elements, and lead, according to the report.
Changes Needed In Law, EPA Says
In a written response to the report, EPA Administrator Carol M. Browner
said that most drinking water systems comply with federal requirements. "But
today's report shows that there is still cause for concern," she said. "Too
many water systems fail to meet basic public-health standards."
The report underscores the need for a stronger Safe Drinking Water Act,
Browner said. Among changes the Clinton administration is advocating are
providing new federal funds to help communities, streamlining enforcement,
toughening public-health standards, placing the highest priority on the
greatest risks, and preventing pollution from entering drinking water supplies
in the first place.
"The new NRDC report shows us once again that turning on our taps is an
act of faith that is not always well-placed," according to David Ozonoff,
chairman of the Department of Environmental Health at Boston University's
School of Public Health.
"For perhaps one out of five Americans, what stands between them and
waterborne disease is not good water but only good luck, Ozonoff said. "The
Milwaukee outbreak of cryptosporidium infection from a large public water
supply has shown us what happens when our luck runs out."
NRDC has released two other reports over the past year on health threats
from drinking water in the United States.
The report, Think Before You Drink: A 1992 and 1993 Update, is available
from NRDC by calling (202) 783-7800.
International Trade
SOUTHEAST ASIAN COUNTRIES OPPOSE LABOR CONDITIONS ON TRADE,
OFFICIAL SAYS
BANGKOK, Thailand--Any kind of labor conditions on trade are unacceptable
to the Association of Southeast Nations (ASEAN) because they would constitute
a trade barrier and affect wage levels, a Singapore official said July 27
after the annual meeting of ASEAN foreign ministers and allied nations.
A recurring theme throughout the meetings was the opposition of the ASEAN
states to any attempts to make trade subject to minimal worker rights or labor
or environmental standards.
Singapore Foreign Minister Shunmugam Jayakumar, replying to a reporter's
question, said labor conditions would be "equivalent to removing our
competitiveness."
According to ASEAN's communique issued July 23 after the annual meeting,
such conditions "could become a new pretext for protectionism."
The foreign ministers of the six ASEAN members--Brunei, Indonesia,
Malaysia, the Philippines, Singapore, and Thailand--had their two-day annual
meeting July 22-23, focusing mostly on regional security and some trade
issues, followed by three days of discussions with "dialogue
partners"--representatives of the United States, Canada, the European Union,
Australia, Japan, New Zealand, and Korea.
Undersecretary of State for Economic and Agricultural Affairs Joan Spero
alone defended the usefulness of discussing labor standards. She said July 27
the United States only wants to "begin to analyze the link" between trade
and labor standards. Talks could proceed in the International Labor
Organization as well as the World Trade Organization, which is to succeed the
General Agreement on Tariffs and Trade next year, she said.
Spero said that the kind of minimum rights the United States would like
to discuss and see enforced--relating to child labor, prison labor, and
freedom of association--are already formally recognized by most trading
countries. Referring to the preceding three days of discussions with various
foreign ministers, she said, "We've made clear that that doesn't mean talking
of wage rates. We don't feel we'll use it [the labor issue] for protectionist
purposes or to remove comparative advantage.
The United States and France in the closing rounds of the Uruguay Round
pushed for formal talks on labor issues in the new WTO. The WTO Preparatory
Committee agreed only to discuss trade and labor issues and a new permanent
WTO committee on trade and the environment was set up.
German Foreign Minister Klaus Kinkel and European Commissioner for
External Political Relations Hans van den Broek told reporters July 26 that
despite France's views, the European Union advocates that "social" standards
remain in the purview of the International Labor Organization, while the WTO
is the proper setting for discussion of how to reconcile trade and environment
objectives.
The United States was represented at the ASEAN meeting by Spero and Deputy
Secretary of State Strobe Talbott; other countries were represented by their
foreign ministers. The foreign ministers of Cambodia, China, Laos, Papua New
Guinea, Russia, and Vietnam attended as "guests."
Trade Blocs, EAEC Discussed
The ASEAN communique also kept afloat Thailand's proposal that Australia
and New Zealand effectively join AFTA, despite Malaysia's opposition. Thailand
has suggested that there be a formal link between AFTA and the Australia-New
Zealand free trade area. Australian Foreign Minister Gareth Evans said July 25
that the link would be on the agenda when the Australian and ASEAN trade
ministers meet in September. New Zealand's Foreign Minister Don McKinnon said
his country was very interested in exploring the idea.
Evans was dismissive, however, of the prospects for the East Asia
Economic Caucus (EAEC), which Malaysia once again tried to launch during the
meeting. An East Asian bloc was first proposed by Malaysian Prime Minister
Mahathir Mohamed in 1990 as a counterweight to the emerging North American and
European trade zones. The idea was endorsed as a caucus in January 1992 by the
ASEAN summit.
Mahathir subsequently proposed that the Asian countries in the 17-member
Asia-Pacific Economic Cooperation forum (APEC) form the EAEC. Canada, the
United States, Mexico, Australia, and New Zealand, though APEC members, would
be specifically excluded. Although the caucus has won the lukewarm support of
fellow ASEAN members, Malaysia has been unable to generate support from Japan
or some other Asian countries, possibly because of continued U.S. opposition.
The ASEAN ministers for the first time persuaded their counterparts from
Japan, China, and South Korea to discuss the EAEC at a July 25 meeting, but
only after Japanese Foreign Minister Yohei Kong insisted that the EAEC not be
the sole topic.
The EAEC is "an idea whose time has not yet come," Australia's Evans
commented, and it is inconsistent with the form of APEC. "EAEC runs the
risk, at best, of being a distraction from APEC, and at worst, of creating
divisions down the Pacific that will be unhelpful in achieving APEC's larger
goals," he said July 25.
Evans made a pitch for upgrading APEC in a speech July 26, saying that
"the time is coming when APEC will need to take on a new and even more
significant role as a body for Organization for Economic Cooperation and
Development-style dialogue
It should go beyond what is achievable in
the General Agreement on Tariffs and Trade and the new World Trade
Organization to become the vehicle for which trade in the region is made
free."
Spero sidestepped questions about EAEC at a press conference July 25,
saying that the United States was still unclear about the purpose of it.
ASEAN Secretary General Ajit Singh said earlier that U.S. officials are
under the mistaken impression that the EAEC would vote as a bloc within APEC.
It is intended only to be "a loose consultative forum," he said.
Vietnam Next ASEAN Member
Vietnam will become the next member of ASEAN and join its free trade
agreement, but the target date for accession remains vague, according to
ASEAN's July 23 communique.
Both Vietnam and Laos have held observer status at ASEAN meetings since
1992. An earlier draft of the communique said that all efforts were to be made
to enable the two countries to join ASEAN by December 1995, when the ASEAN
heads of state and government plan to meet. Although the date for full
membership is open, Vietnam in the coming year will take the preparatory step
of attending ASEAN's economic meetings; Laos will not.
Singh told reporters that by joining ASEAN, Vietnam would be required to
participate in the ASEAN Free Trade Area (AFTA), but it might be granted extra
time to phase in tariff cuts. "AFTA won't be the one stumbling block" to
Vietnam's full membership, Singh said. AFTA was launched in January 1993 as a
15-year program to phase out tariffs on manufactured goods traded among the
six ASEAN members.
Disabilities
CLINTON HERALDS DISABILITIES ACT; STUMPS FOR HEALTH REFORM
SUPPORT
President Clinton July 27 marked the fourth anniversary of the passage of
the landmark Americans with Disabilities Act with thanks all around to
President Bush for signing it, past and current lawmakers for passing it, and
representatives of key interest groups for helping to make a victory possible.
The president clearly drew analogies to the major legislative initiative
of his administration: health care reform that will provide insurance coverage
to all Americans. The biggest challenges often take years to accomplish, he
said, referring to deficit reduction, a global trade accord and health
reform.
At a South Lawn event that included Hillary Rodham Clinton, Vice President
Al Gore and Tipper Gore, members of the Cabinet, and members of Congress, as
well as hundreds of disabled Americans, Clinton noted that his workforce
includes 44 workers who have some form of disability.
The president said one of the goals of his administration is to "empower
all Americans to live to the fullest of their God-given abilities and to
expect them to assume the responsibility to do so."
Clinton said, "The Americans with Disabilities Act
is about
potential. It is not a handout. It stands for what's best in our heritage:
empowering Americans to build better lives for themselves
I pledge as
your president to see that this act is fully implemented and aggressively
enforced."
The ADA and health care reform are linked, Clinton said, because more
employers could afford to hire disabled workers if those workers were covered
by affordable health insurance plans. Health care reform originally was part
of the ADA in the 1980s, but was dropped from the bill by its proponents
"because they knew that this bill would be delayed for years if it had to
deal with the difficult and complicated and politically explosive issue of
health care reform," he said.
"Now is the time to act and to go forward and to finish the work that was
done in the beginning six years ago," Clinton said, to chants of "Now, Now"
from the audience.
The ADA was signed into law in 1990 and eliminates discrimination in
access, employment, transportation and communications for Americans with
disabilities. The final phase of implementation requires small businesses that
employee 15 or more employees to comply with the employment provisions of the
law. Businesses with 25 or more employees were required to comply by July 26,
1992. The final phase is estimated to impact 400,000 private businesses and
100,000 organizations and non-profits in 1994, bringing to 2 million the total
number of businesses covered by the ADA. Some of the transportation provisions
of the law will not be fully phased in until the year 2010.
Communications
LONG-DISTANCE FIRMS LOBBYING FOR HOLLINGS'
TELECOMMUNICATIONS BILL
More than 100 lobbyists from the long-distance industry descended on
Capitol Hill July 27 to muster support for telecommunications legislation (S
1822) sponsored by Senate Commerce Committee Chairman Ernest Hollings (D-SC).
A group of lobbyists and owners of small long-distance companies spoke to
reporters at a morning meeting, criticizing the Bell companies for walking out
of negotiations--a charge the Bell companies deny (142 DER A-13,
7/27/94).
Al McGann, executive director of the Competitive Long Distance Coalition,
said despite such denials, "they [the Bell companies] did walk away from
negotiations."
"We're here to pass legislation, not walk away from it," McGann said. He
admitted, however, that it would be "tough" to get a bill through on the
already tight Senate schedule. If Hollings can get a bill through the Commerce
Committee, he said, there should be time for floor debate in September or
early October.
No Fear of Competition
Brian Thompson, chief executive officer of LCI International, said
long-distance entrepreneurs have flourished "because the rules were such that
they could do it."
The modification of final judgment, which was the 1982 court order that
broke up AT & T, established the rules for competition, Thompson said.
"That's the key to competition," he said.
"I don't mind at all competing against a Bell operating company if the
rules are such that we can compete fairly; in fact I relish it," Thompson
said.
Kathy Haycock, chief executive officer of Call-America, based in Mesa,
Ariz., said "we are not
at all afraid of competing with the Bell
operating companies; however, they're very large, very powerful, and control a
great deal of our business."
Call-America depends on the Bell companies to connect each call from the
customer's home or business to a switch, Haycock said. "Unfortunately, there
are no other options for Call-America," she said, so the Bell companies can
charge premium rates.
Rates would decrease if there were competition in the local exchange,
Haycock predicted. Nearly half of every dollar now charged to customers is for
interconnection service, she said.
Haycock also said the Bell companies have too much confidential customer
information to be allowed into the long-distance markets immediately. Not only
do the Bell companies control access to Call-America's customers, she said,
but they essentially know who the best customers are, and when and where they
call. "There's a real danger that they could use that against us in an
anti-competitive fashion," she said.
Willing to Compromise
Ernest Kelly, president of the Telecommunications Resellers Association,
said that the long-distance industry prefers "actual and demonstrable"
language in Hollings' bill, "but we're willing to accept a compromise in
order to keep legislation moving forward."
Kelly said the long-distance industry has given up a lot. "We can only
hope that the more enlightened of the RBOCs will step forward, recognize what
AT & T did over a decade ago, and give up in order to get," Kelly said.
James Smith, president of the Competitive Telecommunications Association,
said that the Bell companies are concerned that they will lose market share,
which is what happens when competition is introduced into a monopoly. However,
he said, "The Bell companies do not have a birthright to 100 percent of the
customers."
AT & T had the same concerns a decade ago, Smith said, and although the
company now has less business, its revenues have increased. "If the Bell
companies can be innovative and can stop acting like monopolists, they will do
very, very well indeed in a competitive atmosphere," he said.
Sequencing Key
The long-distance industry is trying to compromise around the edges, but
it will not compromise in principle, McGann said. The "sequencing" contained
in the Hollings bill is clear: first universal service, then local
competition, then long-distance.
"That sequence is very, very important to us," McGann said. It will have
to exist in any bill for the long-distance industry to support it, he said,
adding that he was confident Hollings' bill would contain those principles.
McGann challenged the Bell companies' arguments that several
pre-conditions, such as number portability and dialing parity, were onerous.
"These are very normal customer requests," he said, noting that these
conditions must exist to have real competition.
He also disputed the Bell companies claim that the pre-conditions were
introduced at the last minute. The language was introduced two weeks ago, and
"nothing new" has been introduced since then, he said. "They just got
weak-kneed."
Bell company claims of "cherry picking" its best customers also are
unfounded, McGann said. AT & T predicted the same situation a decade ago, but
it never happened. "That kind of thinking is monopolistic thinking," he
said.
Economic Outlook
SMALL, MID-SIZED FIRMS HESITANT ON HIRING DESPITE BETTER
OUTLOOK
Despite their improved profit outlook, executives of small and mid-sized
businesses remain hesitant to hire additional workers in view of their
concerns about labor costs, according to a survey released July 26 by Arthur
Andersen's Enterprise Group and National Small Business United.
The survey showed that, while 61 percent of the firms expect higher
profits in the coming year, only 29 percent plan to hire more employees.
About 63 percent of the firms' owners projected that their workforces would
remain the same size over the next year.
"Labor costs are top-of-mind for many of these executives--they don't
want to hire too quickly because they can't afford salaries and benefits, and
[also] be sure the company will stay on a strong and profitable track," said
Nancy Pechloff, managing director of the Enterprise Group. She added that
"hiring new employees is a major financial move for small and mid-sized
business owners, and as a result, they are proceeding cautiously."
The owners of small and mid-sized firms who were surveyed said they expect
revenues to increase by an average of 6 percent in the coming year and foresee
profits growing by an average of 4 percent.
According to the two organizations sponsoring the survey, over the last
three years since the survey was initiated, revenues and profits have
out-distanced projected new hires by almost five to one. Projected revenue
increases have averaged about 5 percent and projected profits have averaged 4
percent, but plans to hire more workers have been stuck at about 1 percent.
Regulatory burdens and payroll taxes continue to grow, the business
executives said. "In addition to the high cost of unemployment insurance,
workers' compensation and social taxes, business owners are having to cope
with rules ranging from no-smoking ordinances to age and sex discrimination
guidelines," said Ron Cohen, president of National Small Business United.
Escalating costs of health care coverage were cited as among the most
significant challenges to future growth by about 42 percent of those surveyed.
The same proportion cited regulatory burdens, while 35 percent said that
federal taxes were a concern is assessing their costs.
There were some differences by size of firm in the concerns most often
mentioned. For businesses with fewer than 20 employees, the top concerns were
payroll tax deposit requirements (38 percent), wage reporting requirements (29
percent), and occupational safety and health regulations (27 percent). Among
firms with 20 to 499 employees, the major concerns were OSHA and environmental
regulations (each 59 percent), and the Americans with Disabilities Act (22
percent).
The latest survey is based on a polling of 747 owners of small and
mid-sized businesses. The NSBU is a private, non-profit association that
represents small business owners in each of the 50 states, with membership of
65,000 from a cross-section of service and industrial sectors. The Enterprise
Group is part of the Arthur Andersen Worldwide Organization, and specializes
in consulting, tax, and audit services to closely held companies.
Employee Benefits
LABOR DEPARTMENT IS INFORMALLY RESOLVING MAJORITY OF FAMILY
LEAVE ACT COMPLAINTS
Of the nearly 1,000 Family and Medical Leave Act complaints investigated
by the Department of Labor since the law went into effect, the vast majority
were informally resolved by the department, usually by telephone.
"In most cases, educating the employer about the provisions of the FMLA
was enough to bring the employer into compliance," the department said, in a
review of activity since the law was enacted Aug. 5, 1993, until June 30,
1994.
DOL personnel have completed investigations of 965 complaints over the
11-month period and found violations in 591 or 61 percent of complaints. Of
those complaints that investigators determined to be valid, 65 percent
involved charges that the employer had illegally refused to return an employee
to the same or an equivalent job. Twenty percent of the valid complaints
involved situations where employers refused to grant leave.
Once employers were contacted, the department said, DOL personnel
resolved 90 percent of the violations.
Since the law was enacted, the department also has responded to more
than 130,000 requests for publications and technical help and to more than 800
requests for speeches, seminars, and media interviews.
Although no suits have been filed under the law so far, the solicitor's
office is looking at some of the unresolved complaints for possible legal
action, a DOL spokeswoman said. The department could not provide data July 27
on the number of FMLA complaints that had been brought by employees.
The law requires employers to allow eligible workers up to 12 weeks of
unpaid, job-protected leave for specified reasons including the birth or
adoption of a child, care of a spouse, child, or parent with a serious health
problem, or a serious health condition that prevents the employee from doing
his or her own job. Employers must continue to pay group health insurance and
allow the worker to return to the same or an equivalent job.
Earlier this month, Wage and Hour Division official Dean J. Speer said
the department has targeted Aug. 31 for publication of final regulations under
the new law, although he acknowledged that publication in the Federal Register
will depend on how quickly review is completed by the Office of Management and
Budget.
Financial Institutions
WHITEWATER HEARINGS NOT EXPECTED TO HOLD UP ACTION ON
BANKING BILLS
With the interstate branching and community development banking
legislation close to completion in both chambers, industry observers said they
do not anticipate that the startup of up to two weeks of Whitewater hearings
will overwhelm the Banking Committees and delay floor action until the fall.
Whitewater hearings in the House and Senate Banking Committees are
expected to end by Aug. 4, leaving just six congressional work days before
Congress takes its August recess.
Partisan wrangling over the hearings and worry over the point of order
against the banking bill conference report promised by Sen. Phil Gramm
(R-Texas) over the Texas home equity loan provision raised speculation that
congressional leaders may not want to take up too much floor time with the
banking measure.
"Approval of conference reports are generally pretty quick," said
Edward Yingling, American Bankers Association executive director of government
relations. "And both parties want to seek these bills passed."
Congressional staff have completed a draft of the interstate branching
segment of the conference report on the banking bill. According to that July
26 draft, Congress would allow federal banking agencies to pre-empt state law
in four areas as previously reported--community reinvestment, consumer
protection, fair lending, and intrastate branching. According to the draft
language, however, the "public notice and comment process is not required
when a particular request raises issues of Federal preemption of State law
that are essentially identical to those previously resolved by the agency or
the courts, or when the incoming request regarding preemption contains no
significant legal basis upon which to make a preemption determination."
Also, the parliamentarian could deny the point of order against the
Texas home equity provision in the conference report if it is found that this
new language can be hooked onto any other standard in the bill that is not
entirely new, sources said. This is a low threshold, and the Senate supporters
would have to show that the provision is not "entirely irrelevant," they
said.
Whitewater Hearings Begin
House Banking Committee Republicans appeared frustrated at the first
Whitewater hearing July 26 by White House Counsel Lloyd N. Cutler's sworn
testimony that his inquiry into contacts between White House and Treasury
Department officials about Whitewater matters revealed no illegal or unethical
actions, only lapses in judgment.
In the final moments of the seven-hour hearing, the committee's ranking
Republican, Rep. Jim Leach (R-lowa), said, "The Minority remains convinced
that when it comes to criminal investigations, there is no compelling case for
a [public relations heads-up] for any individual, including the president. No
American should be considered privileged before the law."
Cutler had testified that Treasury informed the White House about press
leaks connected with a criminal referral from the Resolution Trust Corp. to
the Justice Department last fall that named President Clinton and Hillary
Rodham Clinton, so that the administration could prepare to answer press
inquiries.
The RTC has an ongoing investigation into the 1989 failure of Madison
Guaranty Savings and Loan Association of Little Rock, Ark., that included
criminal referrals to prosecutors naming the Clintons as possible
beneficiaries of improper activities at Madison. President Clinton has said he
learned of the referrals last October, and that the contacts between his staff
and other government agencies should never have taken place. He asked Attorney
General Janet Reno to appoint an independent counsel in January.
Altman Could Be Fall Guy
Cutler told the House Banking Committee that, according to press
reports, the RTC made nine criminal referrals involving Madison Guaranty, of
which two named the president in connection with a 1978 joint real estate
venture called Whitewater Development Corp. between the Clintons and the owner
of Madison Guaranty, James McDougal, and in connection with some campaign
contributions to a Clinton gubernatorial campaign.
The failure of Madison Guaranty has been estimated to have cost taxpayers
about $60 million.
Cutler spoke at the first of three scheduled days of hearings in the
House on the first phase of independent counsel Robert B. Fiske Jr.'s inquiry
into the so-called Whitewater affair. Lawmakers were only permitted to ask
questions about contacts between the White House, the Treasury, and the RTC.
Hearings in the Senate begin July 29.
The second day of hearings in the House is scheduled for July 28, when
Bernard Nussbaum, the former special counsel to the president, and 10 current
and former White House officials will give sworn testimony before the
committee.
White House officials expected to testify include: Bruce Lindsay,
assistant to the president and senior advisor, George Stephanopoulos, senior
policy advisor to the president, Harold Ickes, assistant to the president,
deputy chief of staff, Mark D. Gearan, assistant to the president for
communications, John D. Podesta, assistant to the president, staff secretary,
Clifford Sloan, associate counsel to the president, Neil Eggleston, associate
counsel to the president, Margaret Ann Williams, chief of staff to the first
lady, Thomas F. McClarty, former chief of staff, and Lisa M. Caputo, press
secretary to the first lady.
The House will complete this round of hearings Aug. 2 or Aug. 4 with
testimony from Treasury officials, including Roger Altman, Treasury deputy
secretary and former acting chief executive officer of the RTC.
Altman has surfaced as the key figure in this round of questioning,
because members feel that he misled Congress in his earlier discussions with
them about Whitewater, staff said.
Although President Clinton recently defended Altman, a long-time friend,
many Democratic and Republican staffers expect him to be the administration's
fall guy in this matter.
Rep. Marge Roukema (R-NJ) asked whether Altman should be asked to resign,
to reconcile his credibility with the Congress. But Cutler defended Altman,
saying that he has been very successful at his job at Treasury.
Cutler's Judgment
One reason that Cutler gave for his judgment that no ethical breach took
place was that "the RTC is not a fully independent agency in the same sense
as the Federal Reserve and the [Federal Communications Commission]."
The RTC acts under the general direction of the chief executive appointed
by and answerable to the president, and under the general supervision of the
Thrift Depositor Protection Oversight Board, which includes the secretary of
the Treasury and a number of other executive branch officers directly or
indirectly answerable to the president, he said.
"In my view the RTC, like the Environmental Protection Agency, is an
independent agency within the executive branch," Cutler said. While this does
not mean the president may try to influence executive branch law enforcement
investigations, it is proper to notify the White House if and when the
attorney general decides to appoint an independent counsel, he said.
The Office of Government Ethics--the agency charged with interpreting and
applying the Standards of Conduct--agrees that the receipt of such information
by White House officials, if not used to further their own or another's
private interest, does not violate the Standards, he said. No one made any
attempt to influence the RTC's decision, he said.
"When I reviewed these incidents in their totality, I found there were
too many people having too many discussions about too many sensitive
matters--matters which were properly the province of the Office of the White
House Counsel. The contacts were not sufficiently channeled between White
House Counsel and Treasury Counsel, and there were too many conversations in
which no counsel participated. In retrospect, we did not meet as high a
performance standard as we should have set for ourselves," Cutler said.
The White House counsel explained that additional measures have since
been taken to assure that future contacts between the White House and
executive branch agencies with law enforcement functions would be beyond
reasonable challenge. These include reminding people of the proper channels to
follow and drafting rules of conduct.
Still, Leach said that the type of insider notification that took place
does more than give a "heads up." It creates the opportunity to try to
sidetrack an investigation, or frustrate the investigation by destroying
documents.
"Whether the first approach was implicity undertaken, clearly it, as Mr.
Cutler noted, didn't work," Leach said. "Whether any documents were tampered
with, we don't know."
In citing one problem for investigators, Leach said, "What we do know is
that the 1985 Clinton campaign records are no longer available."
Environment
EPA, DOJ HEAR DEBATE ON PROTECTING ENVIRONMENTAL AUDITS FROM
DISCLOSURE
Lines were drawn fairly clearly at an Environmental Protection Agency
public hearing July 27 on whether results of a company's environmental audits
should be treated as a company's privileged information and protected from
disclosure.
Representatives of both large and small businesses wholeheartedly embraced
the concept of granting privileged status for audits. They said unless
companies are certain that prosecutors will not use audit results as a
"roadmap" leading to civil or criminal charges for violations, firms will be
discouraged from conducting audits to ensure their compliance with
environmental regulations.
Meanwhile, environmentalists and officials of some states opposed special
privileges for audit results. These state officials said if an audit reveals
environmental violations, dishonest companies simply could choose not to
correct them if the results are privileged.
Environmentalists called for increased environmental disclosure by
industry.
Top officials from EPA's Office of Enforcement and Compliance Assurance as
well as Justice Department officials listened to the comments made at the
hearing, asking commenters to elaborate on various points. EPA held the
hearing to gather information as it reconsiders its 1986 policy on
environmental audits and corporate self-evaluation.
In part, the hearing was designed to review state legislation making
information gathered through voluntary environmental audits protected from
disclosure in various types of enforcement actions. Four states have such
laws: Colorado, Indiana, Kentucky, and Oregon.
Speakers at the hearing said those state laws protect auditing results from
disclosure except in some circumstances - such as if the audit was required
under a consent decree settling earlier charges of environmental violations.
Steven Herman, EPA assistant administrator for the Office of Enforcement
and Compliance Assurance, told BNA that EPA wants to encourage environmental
auditing -- but in a way that does not shield those who violate the law.
"Somehow we'll find a way to do it," Herman said.
Agency officials, who had expected 200 attendees, said more than 400 people
showed up for the hearing.
Fear Of Disclosure
Jean McCreary, vice president of the industry-sponsored Environmental
Auditing Roundtable, questioned the effectiveness of any voluntary auditing
program if companies fear disclosure of auditing results. Firms that now do
audits might conduct them differently if they knew the end product was subject
to disclosure, she said.
Maintaining the confidentiality of audits means the difference between
adversarial enforcement and cooperative compliance, McCreary said.
Companies that detect problems, protect the environment, and report their
violations need incentives to separate them from businesses that wait for
government inspectors to discover their illegal actions, McCreary argued.
Stephen Ramsey, vice president of corporate environmental programs at the
General Electric Co., agreed. Ramsey argued that it is impossible for all of a
company's facilities to be in 100 percent compliance all of the time.
McCreary, who is an attorney with the Rochester, N.Y., firm of Nixon,
Hargrave, Devans & Doyle, suggested a moratorium on penalties for businesses
not currently conducting environmental audits while they set up a system for
doing so.
She said when regulators calculate a penalty, they consider the unfair
economic advantage a firm reaped while polluting. However, she said,
enforcement officials do not consider the costs of a corporation's
comprehensive environmental, health, and safety programs that may have
identified the violation.
McCreary added that small businesses need loans to help start environmental
auditing programs.
Link With Sentencing Guidelines
At the hearing, William Wilkins Jr., judge for the U.S. Court of Appeals
for the Fourth Circuit and a member of the U.S. sentencing guidelines
commission, discussed the links between environmental audits and penalties for
environmental crimes. He said the commission believes that penalties should be
reduced and probation be afforded to companies that voluntarily disclose their
violations, cooperate with authorities, and set up vigorous compliance
programs.
The commission released draft sentencing guidelines for environmental
crimes in November 1993.
Under the draft guidelines, companies without compliance programs are apt
to be put on probation, Wilkins said. A condition of that probation would be
development of such a program, he added.
Wilkins said the draft guidelines embrace self-auditing so a company can
determine whether its environmental compliance program is effective.
Auditing One Part Of Management System
Frank Friedman, senior vice president of the chemical firm Elf Atochem
North America Inc., said at the hearing that environmental auditing is only
one part of an overarching environmental management system. Without such a
management system, the value of auditing is limited, he said.
For example, Friedman said, a company's focus should not be that an audit
discovered that a drum of material was mislabeled. Rather, the firm should
concentrate on why the drum was mislabeled and how to prevent future
mislabelings, he said.
Joan Bavaria, president of the Franklin Research and Development Corp. in
Boston, who represented the Coalition for Environmentally Responsible
Economies (CERES), agreed that total environmental compliance -- and not just
auditing is essential.
CERES, a coalition of environmental, consumer, and religious groups,
drafted a set of corporate environmental obligations in the wake of the Exxon
Valdez oil spill. Formerly called the Valdez Principles, they are now known as
the CERES Principles. Bavaria said 82 companies, from tiny firms to General
Motors, have signed onto the principles. She said another three Fortune 500
companies would become signatories by Aug. 1.
Bavaria and other environmentalists called for greater disclosure by
companies of their environmental performance.
Role Of States
James O'Reilly, corporation counsel for the Procter & Gamble Co.,
emphasized to BNA the importance of the strong support by companies of all
sizes and across various states for granting privilege to audit results.
O'Reilly, who chairs the industry-sponsored Coalition for Improved Audits,
at the hearing encouraged EPA to let states decide the question of whether
companies should be given privileges for their environmental audits.
He told BNA that the approach a state takes to innovative programs like
environmental audits affects their attractiveness to businesses for economic
development. Attorneys general in some states, including Ohio and North
Carolina, are open to the idea of privilege for audits, O'Reilly added.
David Ronald, chief of the Environmental Enforcement Section's criminal
unit within the Arizona attorney general's Office, opposed the granting of
privileges to corporate environmental audits. He said at the hearing that
there is no reason to believe that polluters will change their behavior if
results of their environmental audits can be protected from disclosure.
David Gallogly of the Office of Chief Counsel in the Pennsylvania
Department of Environmental Resources, also opposed privilege protection for
audit results. However, he said, Pennsylvania considers corporate action to
correct violations in a timely fashion as a factor to mitigate penalties.
Ronald said the state privilege statutes require a judge, rather than
enforcement officials, to decide whether a corrective action on a violation
discovered through an audit was taken in a timely fashion. For instance, he
said, the Colorado law allows up to two years for a violation to be corrected.
Environment
HOUSE APPROVES LEGISLATION TO PROMOTE ENVIRONMENTAL R & D
Legislation to promote research and development of environmental
technologies was approved by the House of Representatives by voice vote on
July 26.
The bill (HR 3870) cleared the House Science, Space, and Technology
Committee April 13.
During floor consideration of the legislation, members approved a number of
amendments.
An amendment by Robert S. Walker (R-Pa), passed 286 to 139, directs the
White House Office of Science and Technology Policy to develop specific
criteria and procedures for the evaluation of risk assessment.
In a floor statement, Walker said the amendment would take the basic
elements of risk assessment legislation passed July 20 by the House Science,
Space, and Technology Committee, and incorporate them into HR 3870 "to help
guide the OSTP director as to what the necessary criteria are for conducting
the assessments that are required under HR 3870."
Another amendment by Walker passed by voice vote. The amendment would
require the Environmental Protection Agency to determine whether private
industry research and development is sufficiently meeting the needs of
environmental regulations.
An amendment by Rep. Peter Barca (D-Wis) that would mandate priority in the
development of an overall environmental technology strategy to geographic
areas of significant environmental need also was approved by voice vote. The
amendment also would require that centers that conduct evaluations of
environmental technologies have the capability to evaluate technologies that
address air quality problems in Clean Air Act non-attainment areas.
An amendment added at the behest of Rep. Eric D. Fingerhut (D-Ohio) would
establish a three-year pilot program for the research, testing, and
demonstration of "environmentally efficient" building materials. The
amendment was approved by voice vote.
An amendment offered by Rep. Bill Baker (R-Calif) would establish a
five-year limit on financial assistance for U.S. companies and for
partnerships.
An amendment by Rep. Herbert C. Klein (D-NJ) that would authorize EPA to
provide assistance to other federal agencies that support environmental
technology exports also was approved by voice vote. The amendment specifies,
however, that the language is inapplicable if the president determines that
any provision is actionable under the General Agreement on Tariffs and Trade
and Trade, or any other international agreement to which the United States is
a party.
An amendment offered by Rep. John Tanner (D-Tenn) specifying that
appropriations for the act should not be made available from the defense
research and development activities of the Office of Technology Development
was agreed to by voice vote.
An amendment by Rep. John Linder (R-Ga) that would reduce the funding
authorization from $80 million to $70 million also was approved by voice vote.
Communications
INFORMATION TASK FORCE PLANS OCTOBER REPORT ON GLOBAL
INFRASTRUCTURE
The International Telecommunications Work Group of the Clinton
administration's Information Infrastructure Task Force said July 27 it will
release a report on the global information infrastructure in late October.
The report, Agenda for Cooperation, will serve as "a blueprint for the
Clinton administration's initiatives with respect to the GII," said Secretary
of Commerce Ronald Brown, chair of the task force, during a July 27 public
hearing on the government's role in the GII's development.
The hearings scheduled through July 28, are the first in a series of
events that will help the subcommittee establish U.S. policy on international
telecommunications, said Carol Darr, chair of the working group, which
sponsored the hearings.
On Wednesday, witnesses stressed the importance of standards, access to
foreign markets and the need for copyright laws.
"Standards can help ensure the ready interconnection of the multiple
networks and systems that will comprise the GII," said Leonard Kolsky, a
witness from Motorola. "The most important role for the U.S. government is to
ensure that standard setting practices in other countries are not used to
exclude U.S exports. The government needs to allow the full participation of
U.S. companies in global and regional standards bodies."
Witness Arthur Reilly, chair of a global standardization committee at
the American National Standards Institute, said that in the past U.S.
manufacturers had difficulty providing services to Latin America because of
the difference in standards.
"Ten to fifteen years ago, people standardized existing technologies,"
Reilly said. "Today, we're standardizing future technologies. We try to
exchange information early in the process so we can mitigate arguments over
standards in Geneva."
Reilly said that some of the key component technologies of the National
Information Infrastructure and GII are being standardized in digital access
technologies, asynchronous transfer modes (ATM) and fiber optic systems
through the International Telecommunication Union (ITU.)
"Our standards efforts have been exported as contributions we've
brought to the ITU, "said Reilly. "We continue to work at a rate of approval
of one to two standards every week for the year 1995."
Request For Standards From Private Sector
Witnesses agreed that the government should not mandate standards to
ensure compatibility, but allow the private sector to develop them.
Andrew Maisel, of Sun Microsystems stated his opposition to the Clipper
Chip technology, saying it would not meet international standards, and
commended Gore's announcement that the administration would look into other
means of providing security on telecommunications systems and computers.
Another issue raised was access to foreign markets. Witnesses said that
trade barriers stifle competition and that the federal government should
attempt to remove them.
"The U.S must promote equal access to markets that are in the process
of liberalizing," said witness Robert Levin of Viatel. "The principle of
equal access embodied in the 1982 settlement between the department of Justice
and AT & T led to better, cheaper services when greater competition was
introduced. The U.S. government's equal access policy should be promoted
internationally in order to help bring a more rapid demise to anti-competitive
monopoly practices of those telecommunications networks that are still owned
by governments around the world."
Levin cited Latin America as an example, saying that the
telecommunications market is practically closed to telephone value-added
service providers.
"There is a monopoly in those areas. For example it costs us three
times as much to reach Mexico by phone than Tokyo because of inflated prices
unrelated to costs. The State and Commerce departments must help to remove
non-tariff barriers to equal access in Latin America and the Far East," Levin
said.
A Focus On Latin America, Far East
Secretary Brown, who recently sent a trade mission to South America,
and signed a memorandum of understanding with the Chilean government, said he
is focusing his GII-related efforts on Latin American and the Far East.
"These are two areas of the world with tremendous growth potential," said
Brown.
Several countries in Latin America are working on privatization and
liberalization of the telecommunications industry. China is expected to spend
up to $6.7 billion by 1996 to upgrade the country's communications
infrastructure, said Brown. "For every 100 Chinese, there are fewer than two
phones," Brown said. "By the year 2000 Beijing wants to raise that to 10
lines per 100, the equivalent of building a new regional bell operating
company every year."
Brown is planning a trade mission to China at the end of August.
Copyright laws should be an "integral part" of the development of the
information superhighway, said several witnesses.
"The development of national and global information infrastructures can
only stimulate U.S. competitiveness if adequate and effective intellectual
property protection is an essential building block," said Jason Berman of the
Record Industry Association of America. "The infrastructure will only
function if it operates as a marketplace where goods can be bought and sold."
Emery Simon, speaking on behalf of the Business Software Alliance and
the Alliance to Promote Software Innovation said that intellectual property
protection "is the very foundation of the NII/GII providing necessary
incentives and rewards for development of infrastructure content and
technology."
Requesting Small Business Input
The U.S. Chamber of Commerce, criticized the government for not having
enough representation from the businesses that will be using the services on
the information infrastructures.
"Small and medium-sized businesses have been under-represented in this
debate, said Fred Williamson. "The composition of the U.S. advisory council
to the NII reflects this lack of representation. The industries represented
are essentially those that create, manufacture and sell
telecommunications-based products service or content, not the businesses that
depend upon the use of such products and services for the survival and
expansion of their business."
Williamson said the Chamber of Commerce has established its own
Telecommunications Infrastructure Task Force to develop and recommend sound
positions and proposals for implementing the infrastructure.
Darr said the formation of a global network is moving quickly and
highlighted several events taking place within the next few months to
illustrate this.
The IITF will participate in an APEC conference in November and in
December will participate in the Summit of the Americas to discuss the GII
with Latin American countries.
In addition, the previously announced G-7 Telecommunications conference
will be early next year, said Secretary Brown, who will represent the United
States.
Some 300 people attended the hearing on July 27 and a total of about 30
witness are expected to testify.
Members of the panel included Charlie Rush of NTIA; Scott Harris of the
Federal Communications Commission; Mike Nelson with the Office of Science and
Technology Policy; Jonathan Sallet of the Department of Commerce; Tom Kalil of
the National Economic Council, and Dick Beaird of the State Department.
Communications
FCC'S FIRST AUCTION CONTINUES, ALMOST $500 MILLION RAISED so
FAR
With $493.2 million in bids so far, the Federal Communications
Commission's first-ever auction of airwaves was still active July 27, leaving
officials to guess how high the final tally would go.
The auction began July 25 with opening bids totaling more than $100
million, and the amount has been steadily increasing ever since. Although the
FCC allotted three days for the auction, it had prepared contingency plans to
continue the auction if bidding were still active after three days.
FCC officials said they were satisfied with the current activity level,
and had no plans to push for closure on the auction, which could continue into
July 28 if necessary.
Auction participants are bidding on 10 blocks of narrowband spectrum,
which will be used for new personal communications services such as advanced
two-way paging and messaging devices (141 DER A-12, 7/26/94). The
auction is being conducted in rounds of about one hour each, during which
participants may bid on up to 10 blocks.
Some of the largest blocks of spectrum had received bids of $70 million
each, while the smallest blocks ranged from $12 million to $14 million each.
At a morning meeting with reporters, FCC Chairman Hundt said the FCC
wanted to award licenses speedily, conduct the auction smoothly, and wanted
the competition to be strong. "We think we've hit all three of these goals
already," he said.
The auction is giving the nation a vision of our policy, Hundt said. "Our
policy can be summarized in one word, which is competition," he said, adding
that competition for licenses will lead to competition in the marketplace.
Hundt said that it has never been the commission's goal to obtain a
particular amount of money from the auction. He also said the commission had
no goals as to who would own the licenses or what the owners would do with
them.
Pesticides
INDUSTRY--BACKED BILL REPORTED OUT OF HOUSE AGRICULTURE
SUBCOMMITTEE
The Food Quality Protection Act, primarily an industry-backed bill, was
favorably reported by the House Agriculture Subcommittee on Department
Operations and Nutrition July 27 with an en bloc amendment, which provoked no
controversy from the subcommittee.
The reported version of HR 1627, sponsored by Reps. Thomas Bliley (R-Va),
Richard Lehman (D-Calif), and J. Roy Rowland (D-Ga), would amend the current
pesticide and food safety laws -- the Federal Insecticide, Fungicide, and
Rodenticide Act and the Federal Food, Drug, and Cosmetic Act.
This latest version would replace current adjudicatory hearing requirements
with a formal rule-making process for cancellation of the registration of a
pesticide product; allow the issuance of an emergency suspension order before
issuing a proposed cancellation rule-making provided that the rule-making is
issued expeditiously; and require the Environmental Protection Agency to
re-evaluate tolerances in conjunction with the reregistration of pesticides
under FIFRA.
En Bloc Amendment Unanimously Accepted
The en bloc amendment provoked no discussion and was agreed to
unanimously. One component would require the EPA administrator to consult with
the Secretary of Health and Human Services prior to cancellation or suspension
of a pesticide product. Another element would give states authority to collect
data and information from registrants in connection with local pesticide
issues.
It also would require the administrator to publish a list of pesticides
where the overall exposure via food, water, home use, and other sources is
likely to present risks to infants and children that exceed the EPA standard
of negligible risk.
More To Come On States' Authority, Exports
Rep. George Brown (D-Calif) offered an amendment to delete a section in
the bill concerning states' authority. Most members, however, wanted to keep
the section, which many interpreted as allowing local jurisdictions to
petition states for their own regulations but not permitting local governments
from having authority to pre-empt federal regulations.
EPA officials at the mark-up also expressed uncertainty surrounding the
language. Brown eventually withdrew the amendment, but Rep. Steven Gunderson
(R-Wis) asked that the subcommittee staff review the language to avoid any
misinterpretation of the law.
Rep. Dan Glickman (D-Kan) told the subcommittee he will offer an amendment
concerning the export of pesticides at the full committee mark-up.
Brown also said he planned to offer an amendment to ensure that fees were
collected to complete the reregistration of pesticides called for in the 1988
amendments to FIFRA. Chairman Charles Stenholm (D-Texas) said that he "is
tempted to say that as the bill is written now, the fees will be included."
If fees are needed for EPA to do its job, then they are "not off the table,"
but the committee needs to figure out for what, and how the fees will be used
before language is included, he said.
Negotiations Uncertain
Jim Aidala, associate assistant administrator for Prevention, Pesticides
and Toxic Substances at EPA, told BNA July 27: "It is good to see the bill
move forward. The issues that were raised were not surprising, but will be
difficult to work out." Aidala pointed out that the most difficult issues
those related to food safety -- were not addressed at all in the mark-up.
The other House committee with jurisdiction over the bill is the Energy and
Commerce Committee. When asked if Republicans on the Subcommittee on Health
and the Environment are ready to negotiate, an aide from Bliley's office told
BNA that whether there is room for negotiation "still remains unanswered on
this side."
He characterized HR 1627 as being a "rational, broad-based bill," backed
by one Republican and two Democrats clearly a bi-partisan effort, he said.
But the chairman of the subcommittee, Rep. Henry Waxman (D-Calif) "is working
with the far left on the issue," the aide said. His bill (HR 4362) is
supported by a "bunch of chemo-phobes" and "the decision really rests with
him," the aide told BNA.
Industry "Will Not Be Stampeded"
John McCarthy, vice president of global, scientific, and regulatory
affairs at the National Agricultural Chemicals Association, told reporters
July 27: "We will not be stampeded into legislation to fix the Delaney
Clause." The Delaney Clause is a provision in FFDCA that prohibits food
additives linked in any way to cancer from concentrating in processed food.
In order to push legislation this Congress, the administration has gone
ahead with several food tolerance revocations stemming from the federal
appeals court ruling in July 1992, which insisted EPA enforce a strict
interpretation of the Delaney Clause (Les V. EPA, CA 9, No. 91-70234,
1992), McCarthy said. But the agency has other means to handle the
problem, he said. For instance, in order to fall under the Delaney Clause, a
pesticide must "concentrate" as defined in the "flow-through" provision
found in Section 402 of FFDCA, he explained. Under that definition, the
pesticide must concentrate when "ready to eat," but EPA regulates that
provision at the stage when commodities are "ready to ship," he said.
Richard Urbanowski, NACA's chairman of the board and president of ISK
Biosciences, took issue with EPA Administrator Carol Browner's presentation of
the pesticide issue in U.S. agriculture. She has said, according to
Urbanowski, that "pesticide use has grown by leaps and bounds," when in fact
it has stabilized over the past three years. Specifically, Browner's statistic
that more than 3 billion pounds of pesticides are used annually is erroneous,
he said. In fact, 800 million pounds are used annually, he told reporters.
Such comments cast an unfounded image of the farmer over-using pesticides,
Urbanowski said, and creates unnecessary public concern. Furthermore, that
kind of representation "makes it difficult to have a working relationship"
with the administration, he told reporters.
Jay Vroom, president of NACA, said that while the group's relationship with
the political appointees of the administration has been strained, its
day-to-day exchange with EPA's career employees has been smooth. Both Vroom
and Urbanowski commended efforts of Lynn Goldman, assistant administrator of
OPPTS, to establish a relationship with industry. "Browner appears to be
speaking from another agenda," Urbanowski said.
Compromises Made, NACA Says
Vroom said that significant compromise has already been made to meet the
administration on the legislative table. For instance, the version HR 1627
reported out July 27 contains stiffer language to accelerate the cancellation
of pesticides, he said.
According to a subcommittee summary of HR 1627, it "generally requires EPA
to set tolerances at a level which pose no more than a negligible risk to
public health and directs them to take into account health, nutritional, and
consumer benefits, including the impact of the loss of a pesticide on the
availability of an adequate, wholesome, and economical food supply."
For industry, according to Vroom, that new provision also represents a
"reduction in our statutory protection." And, the provision to "de-link"
suspension procedures from cancellation is a compromise, he said.
Environment
SUPERFUND BILL PROGRESSES IN HOUSE; MOVE ON RETROACTIVE
LIABILITY THWARTED
Superfund reform took another step forward July 27 with the approval of
the administration-backed bill (HR 3800) by the House Public Works and
Transportation Subcommittee on Water Resources and the Environment.
Prior to approving the measure on a voice vote, the committee defeated two
controversial amendments, including one that would have eliminated retroactive
liability for potentially responsible parties at contaminated sites. Also
defeated was an amendment that would have further loosened ground water
cleanup standards.
The committee, however, narrowly approved an amendment to remove language
that would have extended superfund liability to "pollutants and
contaminants."
Full Public Works Committee markup is scheduled for July 28, and a number
of other amendments are expected to be offered, as well as further attempts to
eliminate retroactive liability.
Meanwhile, the Senate Environment and Public Works Committee set markup of
its administration-backed bill (S 1834) for Aug. 3.
The move to eliminate retroactive liability was led by Rep. Bill Zeliff
(R-NH), who called retroactive liability "un-American, immoral, and unfair."
The amendment was defeated, 25-13, with four Republicans voting with the
majority and three Democrats voting with the opposition.
Before the vote, Rep. Norman Y. Mineta (D-Calif), chairman of the full
committee, told members that eliminating retroactive liability would
jeopardize HR 3800's new allocation scheme, increase general taxes by nearly
$1 billion a year, and destroy the coalition that supports the bill.
"This is a vote where you really let people know whether you're serious
about superfund reform," Mineta told the subcommittee members.
Mineta was joined by Rep. Sherwood L. Boehlert (R-NY), ranking republican
on the subcommittee, in calling for defeat of the measure. Boehlert said that,
while the proposed legislation is not perfect, "its better than the
alternative proposed" by Zeliff.
Ground Water Amendment
The amendment to loosen ground water cleanup requirements was offered by
Rep. James M. Inhofe (R-Okla). It was defeated, 23-14. Leaders of
environmental groups have strongly opposed relaxed ground water standards.
Earlier, the committee accepted other changes from the version of the bill
that was unanimously approved May 18 by the House Energy and Commerce
Committee.
Among those were changes to the ground water cleanup provisions to reflect
the findings of a National Research Council report released June 23,
congressional staff said. The report said ground water cleanup could not
always be achieved due to limitations on existing technology.
The changes maintain drinking water cleanliness as the goal for ground
water cleanup, but call for remedial actions to "attain levels appropriate
for the current or anticipated future use of ground water."
The changes also called for the effectiveness, reliability, and cost of the
remedy, as well as its acceptability to the community, and the urgency of the
need for ground water to be among the factors to be considered when choosing a
cleanup remedy.
The amendment to remove the extension of liability to pollutants and
contaminants was offered jointly by Rep. Glenn Poshard (D-III) and Tim
Hutchinson (R-Ark). It was accepted, 20-18.
According to Poshard, under the bill the Environmental Protection Agency
would retain response authority not only for hazardous substances but also for
pollutants and contaminants. He said EPA had other means outside of superfund
to recover the cost of responses on non-hazardous substances.
The pollutant and contaminant liability language also was removed in the
Senate version (S 1834) pending before the Environment and Public Works
Committee (25 ER 300).
An amendment offered by Boehlert designed to ensure expedited settlements
for small businesses was approved.
The panel also approved Boehlert's amendment to ensure that states with
funds set aside for inactive hazardous waste site cleanup were not put at a
disadvantage for competing for federal cleanup funding.
Other Amendments
A third Boehlert amendment regarding the selection of land use and cleanup
strategies for federal facilities scheduled for realignment or closure also
was approved. The amendment would require EPA to consider the suggestions of
community entities created to recommend reuses of federal facilities to be
considered in lieu of convening Community Working Groups which are called for
under HR 3800.
The committee accepted an amendment by Rep. Robert Menendez (D-NJ) that
would authorize EPA to establish a program that would help recruit and train
citizens living near superfund sites to participate in cleanup. Rep. Bud
Shuster (R-Pa) amended Menendez's proposal to require that funding be taken
from the $50 million set aside under the community participation provisions.
EPA would have to submit a site-specific cleanup progress report to states
and share remedial technology development information with the states under
two amendments developed by Rep. Steve Horn (R-Calif).
Other amendments approved included one by Rep. Thomas E. Petri (R-Wis) that
would clarify liability exemptions for certain battery recyclers and one by
Rep. Robert Borski (D-Pa) designed to add incentives for the purchase of
contaminated property.
Environment
STATE FLEXIBILTY IN MEETING GOALS OF AIR ACT PLEDGED BY EPA
OFFICIAL
NEW ORLEANS The Environmental Protection Agency's top air quality
administrator told state legislators July 27 that the agency will attempt to
be as flexible as possible in helping states comply with air quality standards
under the Clean Air Act.
Mary Nichols, assistant administrator for the EPA Office of Air and
Radiation, conceded that states have a tough job complying with the broad
range of air quality standards under federal law. But she suggested that
states have generally done their jobs well and promised to provide the states
with flexible options for compliance when possible.
State legislators, attending the annual meeting of the National Conference
of State Legislatures, said the message eased some of their concerns about an
agency with which states often find themselves butting heads.
"I think the most important thing she said was that when the law permits,
flexibility is the order of the day," said Sen. Herschel Rosenthal (D-Calif).
Nichols said that EPA's 10-year trend studies consistently have shown that
the nation's air pollution problems are improving. States have been
fundamental in this effort she said and noted that 98 percent of the state
plans for various compliance standards under the Clean Air Act have been
received at the agency, eliminating the possibility of sanctions in those
regions.
Auto Inspection Programs
States, for the most part, also have complied with enhanced vehicle
inspection and maintenance program requirements under the Clean Air Act, she
said.
With additional compliance targets still ahead, she said the agency will
try to help states when possible. She noted, in response to a question from
legislators, that Administrator Carol Browner recently had stated that EPA is
willing to allow regions required to develop employee commute options to
perform their programs on a seasonal basis. Regions, however, would have to be
able to demonstrate that their ozone season programs can meet the overall
targets of the program, she said.
Nichols also reminded legislators that under the ECO requirements, states
cannot be punished for missing their targets. They must make good faith
efforts to meet the requirements of the law, however, she said.
State Rep. Roger Roy (R-Del) said EPA's new approach on ECO does
demonstrate flexibility by the agency and would help his state comply with the
law.
"I think what they are suggesting is a more practical approach," Roy
said. "An employer trying to encourage people in my state to ride bicycles or
work a compressed work week isn't going to get a lot of takers in the dead of
winter."
Manufacturing
JUNE ORDERS FOR DURABLE GOODS UP 1.3 PERCENT, COMMERCE
REPORTS
New orders for manufactured durable goods jumped 1.3 percent in June,
bolstered by an upswing in bookings for capital goods and transportation
equipment, the Commerce Department reported July 27.
Seasonally adjusted data from the department's Census Bureau showed that
orders for durable goods products designed to last at least three years --
advanced to $151 billion during the month. It was the fourth consecutive
monthly increase and the 10th advance posted in eleven months.
June's bookings were about $2 billion higher than the revised $149
billion tally posted the previous month, the latest data showed. Last month,
the government reported that orders for durable goods rose 0.9 percent to
$148.4 billion in May (120 DER N-1, 6/24/94).
The Census Bureau noted that, on a year-to-date basis, bookings for
manufactured durable goods were 13.3 percent higher than they were a year ago.
The government's latest report on manufacturing activity also showed that
durable goods shipments were up 1.1 percent to nearly $150 billion in June,
with increases posted in all major categories except fabricated metal
products, primary metals, and lumber and wood products.
In addition, unfilled orders rose for the third month in a row in June,
edging up 0.2 percent to $425.4 billion, the Census Bureau reported.
Economists attributed the stronger-than-expected upswing in durable goods
orders to ongoing strength in non-defense capital investment, where bookings
jumped 6.2 percent. Excluding aircraft and parts, new orders for non-defense
capital equipment climbed 6.4 percent, a new all-time high, according to
Commerce Secretary Ronald Brown.
Brown said the rebound in capital goods orders indicates that "growth in
productive capacity is continuing as the economic expansion matures."
National Association of Manufacturers Economist Gordon Richards noted
that capital investment has been one of the most robust sectors of the economy
during the latest recovery.
"Basically, decreases in the relative price of computers and machinery
have lowered the cost of capital and increased the incentives for
investment," Richards said. "Further, with continuing pressure on profit
margins from global competition, industrialists have invested very
aggressively in order to control costs."
Economists at Merrill Lynch & Co., however, noted that orders for
non-defense capital goods had fallen in each of the four preceding months.
"This leaves us with a capital goods sector that is experiencing solid, but
not overly explosive growth," Merrill Lynch said in its July 27 Economic
Commentary.
The transportation sector also provided grist for the new-orders mill in
June, with bookings up 2.3 percent to a seasonally adjusted $38 billion, the
second consecutive monthly increase. Bookings for transportation equipment had
fallen in February, March, and April, Commerce data showed.
The June increase in new orders for transportation equipment was
concentrated chiefly in motor vehicles and railroad equipment.
Also on the rise in June were new orders for industrial machinery and
equipment, which advanced 2.2 percent; electronic and other electrical
equipment, up 1.1 percent; and instruments and related products, Commerce
said.
New orders for primary metals, on the other hand, sank 3.1 percent in
June.
The following BNA graphic and Census Bureau tables show the latest data:
Not available on line; see print publication.
For full text of most reports and documents
mentioned on-line, contact BNAs research and
special projects division, BNA PLUS,
1-800-452-7773, or 202-452-4323 if calling in
the Washington, D. C. metropolitan area.
Weekly Earnings
WOMEN WORKERS EARN ONLY 76 PERCENT OF MEN'S WEEKLY WAGES,
DATA SHOW
In the second quarter of 1994, the median income of full-time female
workers was only 76 percent of full-time male employees and the wage gap
continued even among the highest earning 10 percent of men and women,
according to data released July 27 by the Labor Department's Bureau of Labor
Statistics.
Women who worked full time had median weekly earnings of $396, while the
median for men was $521.
The highest-earning 10 percent of men had a median income of at least
$1,130, while the highest-earning 10 percent of women earned $803 or more, BLS
found.
Median weekly earnings of all of the country's 87.1 million full-time wage
and salary workers were $465 in the second quarter of 1994, up from $459 in
current dollars. When adjusted for inflation, however, wages fell. Using a
constant dollar benchmark of 1982, wages were $304 a week in 1994's second
quarter, down from $307 in 1993. (All other references are in current
dollars.)
The gender pay gap was present for white, black and Hispanic workers,
although it was widest for whites. White women's median weekly income was
$405, or 74.9 percent of men's median $541 wage. Median income for black women
was $343, or 83.5 percent of black men's median wage of $411.
The gap narrowed considerably for Hispanic men and women. Hispanic men
made a median weekly income of $338. Hispanic women's median wage was $312, or
92.3 percent of Hispanic men.
Median weekly income for Hispanics, at $326, was lower than for blacks, at
$370, and whites, at $480.
Men between 45 and 54 years old had the highest median weekly earnings, at
$654. Peak earning years for women were between 35 and 44 years old, at $466.
Workers 25 years old or older who did not graduate from high school had
median weekly earning of $308, compared with $417 for those with a high school
diploma and $732 for college graduates.
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FAST-TRACK COMPROMISE I
Creator: Justine F. Rodriguez RODRIGUEZ_JOMB
ARMS Email System
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CREATION DATE/TIME:10-FEB-1997 08:19:03.00
SUBJECT: MEET THE PRESS 2-9-97
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TEXT:
TRANSCRIPT
NBC "MEET THE PRESS"
WITH HOST: TIM RUSSERT
GUESTS: JACK KEMP
SUNDAY, FEBRUARY 9, 1997
MR. RUSSERT: But before we give way to the likes of Michael
Jordan, we're joined by the former Buffalo Bills quarterback and
running mate for Bob Dole in the November election, Jack Kemp.
Welcome back.
MR. KEMP: Hi, Tim. How are you doing?
MR. RUSSERT: It's been three months since the election.
Looking back, why do you think the country chose Clinton/Gore
over Dole/Kemp?
MR. KEMP: Well, clearly the country had a relatively good
economy.
I was making the point, as was Bob, that it's not good enough
until one breadwinner per family can take care of that family,
but, clearly, the economy was relatively good. We were relatively
at peace, and the president probably, as Bob Dole said on NBC
just a few weeks ago, they got about $80 million to spend between
April of '96 and the August convention of the Republican Party.
So the odds were against us, but it was a good race. Bob is an
unbelievable warrior, and I was glad to see President Clinton
give him the freedom medal, and the honor that he paid to Bob
Dole I think was well deserved.
MR. RUSSERT: The president is at 62 percent favorable rating.
Are you surprised by that?
MR. KEMP: Not really. He's given the State of the Union, he
had his inauguration. Again, the numbers indicate that things
look relatively good right now. Inflation is under control,
unemployment's at five-point-what, three or four, percent. The
president gets a good bump out of that, and I'm not surprised by
his numbers.
MR. RUSSERT: The year 2000 is rapidly approaching. Is Jack
Kemp going to try for the top spot?
MR. KEMP: You know, Tim, I think you ought to call Bob
Schieffer and Cokie Roberts and Tony Snow and Evans and Novak and
make a pledge, a compact, that that question not be asked of any
candidate until after the mid-term elections.
We have perpetual campaigns. Give the American people a rest.
I'll tell you this: My appetite is whetting.
MR. RUSSERT: You liked it?
MR. KEMP: I loved it. We had a great time. My wife and I went
all over the country. People were great.
Would I do some things differently? Absolutely, but, like an
old quarterback who maybe lost a game, there's a lot in the
future that I want to be talking about, because America at the
end of the Cold War has a, and must have a, vision of the future
not only of prosperity at home for all people, equality of
opportunity for all people, but we've got to find a way to
integrate in this global economy the Eastern European nations,
Africa, Asia, and the Third World.
So I'm looking forward to being a big part of that debate, and
I'll let you know after the mid-term elections.
MR. RUSSERT: The first step in any presidential campaign,
however, is to form a political action committee.
MR. KEMP: Right.
MR. RUSSERT: Are you doing that?
MR. KEMP: By the end of this month, we'll have a political
action committee to help finance some of my travels on behalf of
gubernatorial candidates and state legislative candidates and
members of Congress who are competing members of Congress. So I'm
going to have a political action committee and lay the
architecture nationally for the type of financial effort that
you've got to make if you're going to be ready to run.
MR. RUSSERT: There was a lot of criticism from Republicans
about your performance in the vice presidential debate. A few
stories in recent weeks that I want to get your response to --
"The Daily News" had a story -- let's take a look at it on the
screen there, and you can see it -- where it talks about ``Jack
Kemp is telling pals there's
a simple explanation for his lackluster performance in the 1996
veep debate: The Dole campaign screwed up."
MR. KEMP: Yeah, that's totally false.
They didn't screw up. I lost, but I've lost games before. I've
looked at the films on Monday morning, and I learned from it, and
I proved that I could be disciplined, that I could stay within
the time frame, that I could travel the country and be loyal to
Bob Dole and particularly loyal to the party of Lincoln and what
it means to the future.
So, again, there isn't anybody that looks back that can't
figure out places where he or she would do things differently,
and I certainly would, but they didn't screw up. I would take the
blame myself.
MR. RUSSERT: Would you love a rematch with Al Gore?
MR. KEMP: That would be very, very interesting, it certainly
would.
MR. RUSSERT: What would you do differently?
MR. KEMP: Stay tuned. (Laughter.)
MR. RUSSERT: All right. Let me show you a new poll that's out.
This is the Reuters poll, asking Republicans all across the
country who they prefer as their nominee in the year 2002. Colin
Powell far out in front, as you can see; George Bush Jr., he's
the governor of Texas; then Jack Kemp, followed by Dan Quayle,
Fred Thompson, Lamar Alexander.
Colin Powell. That's very strong --
MR. KEMP: Oh, it really is. Colin Powell is enormously
popular, and deservedly so. He's a great American and a good
friend, and there's no reason why he shouldn't be that high or
higher.
MR. RUSSERT: Now, John King of the Associated Press wrote a
story.
I want to get your response to that, and let's show our viewers
on the screen. He said that Jack Kemp, in his conversations,
according to several long-time associates, the 1996 GOP vice
presidential nominee has dropped this nugget. Kemp says retired
General Colin Powell assured him that under no circumstances
would he seek the presidency in three years.
MR. KEMP: No, that's -- John King's a terrific reporter and a
friend of mine, but that's far exaggerated.
Colin Powell speaks for himself. Anybody who knows General
Powell knows that he speaks for himself, and I would never, ever
speak for him, and that is just at odds with the fact that I
would never try to make a statement about Colin Powell's
intentions in '96, much I mean, in the year 2000, much less
the '96 campaign.
MR. RUSSERT: But that being said, do you think General Powell
has an appetite for politics?
MR. KEMP: You've got to ask him that. I'm not going to speak
for him.
MR. RUSSERT: He would be a strong candidate if he --
MR. KEMP: He is a strong leader. Bill Bennett and I thought he
would have made a great candidate in '96. He chose not to run. We
serve on the board of Howard University together.
He's an amazing man with tremendous popularity, has a
fantastic message to America not only in terms of his rhetoric
but in terms of the results of his life, which, if this country
is to provide equality of opportunity, it's got to be in the
economy, as well as in the military and arts and sciences and
athletics.
MR. RUSSERT: Do you think it'll be a crowded field for
Republicans the next time?
MR. KEMP: It'll be crowded in terms of the people who are
being mentioned. I don't know how crowded it'll be in the year
2000.
MR. RUSSERT: There's a lot of debate within the Republican
Party about Newt Gingrich, the speaker, trying to rehabilitate
himself.
Bill Bennett, your friend and your colleague in Empower
America, criticized Speaker Gingrich for, as he said, currying
favor with the likes of Jesse Jackson.
MR. KEMP: That's Bill Bennett. I personally believe that Newt,
as the speaker of the House, must be inclusive, and Jesse Jackson
is a leader. White folks do not choose the leaders of black
Americans, and
I think it was a very legitimate request, or invitation, I should
say, by Newt Gingrich to have Jesse Jackson there.
And don't forget, it was Newt Gingrich who had J.C. Watts
deliver the Republican response to the State of the Union, and
J.C. Watts not only is a rising star, but did a wonderful job of
articulating the vast differences between the Clinton
administration, the Democratic Party's version of budget reform
and the Republican Party's vision of the future.
So I was pleased that Newt made both those decisions.
MR. RUSSERT: In our NBC News/"Wall Street Journal" poll,
Americans said that Newt Gingrich is the foremost spokesman for
the Republican Party. Is that a problem for the Republican Party?
MR. KEMP: Well, right now, I would say Trent Lott is the
spokesman. Trent has done a fantastic job becoming the majority
leader in the United States Senate. He's handled himself, I
believe, with maturity, diplomacy, and grace. He clearly has
articulated the agenda. In fact, I believe the center of gravity
is in the Congress and its with the Senate majority leader, and
Newt can and will rehabilitate himself, if that's the word that
you have chosen to use, by getting things done. He went to Dubose
(sp) and talked about fast-track authority for the president to
include Central and Latin America in the NAFTA hemispheric free
trade zone. He wants to help the District of Columbia, as does
Trent Lott.
In my opinion, if the Republican Congress were to help this
city become economically viable, fiscally viable, and to stop the
implosion, it would be a tremendous signal to America that other
urban areas could equally achieve the type of progress and
prosperity that has to be done.
So I think those are the type of things that Republicans ought
to be talking about, along with balancing the budget and tax
reform.
MR. RUSSERT: What would Jack Kemp do for the District of
Columbia?
MR. KEMP: Well, I would immediately support Eleanor Holmes
Norton's very courageous idea to create a supercharged, as it
were, enterprise zone in the city, eliminate the capital gains
tax. In yesterday's paper, there was a very interesting article
about Dublin, Ireland, and what they did to make Dublin
economically viable. They cut the corporate income tax to 10
percent until the next century, they eliminated the capital gains
tax and the double taxation of dividends, and if you read the
story that's coming out of Dublin, it is amazing that
incentive-based economics can move behavior or change behavior,
and Dublin now is growing, jobs being created, the docklands have
been recovered, and I believe that Eleanor Holmes Norton's ideas
for a modified flat income, Hong Kong-like tax code for the
District of Columbia would be a down payment on helping East
Harlem, East St. Louis, East L.A., East Palo Alto, and other
urban areas of America.
MR. RUSSERT: Businesses would invest and you would make
Washington the Hong Kong of the Potomac?
MR. KEMP: More importantly, you would attract families, you
would attract new jobs, you would attract minority entrepreneurs,
you would attract the type of a tax base that would help us solve
the problems of crime, education - it's not a panacea, but, in
my opinion, she has taken a long leap forward in helping to
change the focus of debate from just spending albeit that's a
very important issue - to building a tax base that will hold and
attract families and jobs and capital investments so necessary to
making this city great again.
We've got to deal in this city with crime. Rudy Giuliani in
New York City has proven that crime statistics can be turned
around with more police on the streets, but they don't have
enough money in this city right now -- and I applaud the
president for beginning to address the issue of the problems this
city has that no other city in the United States of America has.
But Newt is right. So is Trent. We've got to make this capital
city of America a city shining on a hill, and right now it's
shining in the wrong direction.
MR. RUSSERT: You have been the most outspoken Republican on
the issue of race. Americans, as you know, and it came to light
again last week with the O.J. Simpson verdict, are very divided.
Whites think Simpson's guilty, blacks think he's innocent.
If President Jack Kemp had to address the nation tonight on
the issue of race and the fallout from Simpson and all the other
issues that are out there, what would you say to blacks and
whites?
MR. KEMP: Well, take it out of the context of the presidency,
because I didn't win I didn't even win the vice presidency.
I'm sorry I can't cut your taxes, Tim, but we'll give it another
shot someday.
But, seriously speaking, it's the single most important issue
facing America at the turn of the century and the new millennium.
Racial reconciliation, civility, an America where you can have a
dialogue over affirmative action, for instance, without being
accused of being a racist either way or on either side of that
issue.
These are important issues that have to be addressed, and I
would like to see an America in which black and white actually
listen to each other, where the Jewish community and the black
community get back to the famous social contract that was made in
the civil rights movement because the Jewish community strongly
supported Dr. King and Rosa Parks and John Lewis, and I would say
this and I don't want to be an economic determinist about it
-- but you cannot solve the problems of race in America and
there have - we've made a lot of progress without an economy
that's growing, where there are chairs at the table for every
single American, where people feel like it's not a zero-sum game
where your profit is coming at my expense, and today, the
unemployment rate in urban America is a disaster waiting to
happen, if not already happening.
James Julius Wilson at the University of Chicago said the
absence of employment in America's inner cities, particularly
among men and women between the ages of 18 and 28, is the single
greatest challenge to this country on the eve of the 21st
century, and it can't be solved with rhetoric. It has to be
solved with sound, positive, progressive, inclusive policies, and
I want to see the Republican party lead that debate, because we
are the party of Lincoln, and we must be an inclusionary party
that says that by the year 2000, as I tried to say in Harlem one
day during the campaign,, I'd like to see an America where half
of all black Americans are voting Democrat, but the other half
are voting Republican. I think it would be good for the
African-American community, I think it'd be great for the
Republican Party.
I'll tell you what, Tim, it would be good for America to have
a real debate in which one party does not take the black vote for
granted, which I think the Democratic Party does, and the
Republican Party does not write it off, which all too often we
have. We've got to stop that, have both parties competing for
every single vote, particularly of minority Americans.
MR. RUSSERT: During the campaign, you created a little stir
when you said that you wished you had been invited to speak to
Louis Farrakhan's Million-Man March.
Do you believe that Louis Farrakhan has a positive role to
play in race relations, or is he anti-Semitic?
MR. KEMP: Well, I think we've got to hear the message. He
certainly has associated himself with anti-Semitic comments. He
has repudiated that, he says. I'd like to see more evidence of
it. They've got to stop selling the Protocols of the Elders of
Zion, which is offensive not only to Jewish Americans, but to
Jews all over the world, and particularly Christians, who care so
profoundly about the issues of anti-Semitism and ending it and
bigotry in America.
I said, Tim, that I thought the message of the Million-Man
March fathers being good fathers, husbands being good
husbands, men acting in a responsible way and I would imagine
that's what Charles Barkley, Grant Hill, and Michael Jordan are
going to be talking about in the panel to come -- that's a good
message, and whether it's Promise Keepers, which I also attended,
I simply said that I would have liked to have I'd like to have
given the speech I gave at Harlem to Promise Keepers and to the
Million-Man March, and I stand by that statement. That is not a
statement from which I would ever retreat.
MR. RUSSERT: We have to take a quick break. We'll be right
back with more of Jack Kemp, and then Michael Jordan, Charles
Barkley, Grant Hill, talking about kids and drugs and
out-of-wedlock births as you've never seen them before. Right
after this on "Meet the Press."
(Announcements.)
MR. RUSSERT: We're back.
Jack Kemp, the president has sent his budget to Capitol Hill.
It calls for a targeted capital gains tax cut, a decrease in the
growth of Medicare. It looks like Democrats and Republicans can
work together and truly balance the budget by the year 2002?
MR. KEMP: Oh, I believe we can work together and I believe we
can balance the budget. The growth figures in the president's
budget are far too small, and I would hope that the Republican
Party sends to the president a tax bill that broadens the tax cut
on capital gains and indexes it. Alan Greenspan said it should be
eliminated and it would raise revenue throughout the rest of the
tax code.
But putting that aside for the moment, indexing, cutting,
getting a handle on entitlements, the president's budget,
however, was not dead on arrival, but, as Trent Lott, I think,
wisely said, it's alive but hardly kicking.
But it's interesting to me that every budget that Ronald
Reagan sent to the Congress back in the '80s was dead on arrival
to the Democratic Party. The Republicans have wisely said we can
work with this president, we can achieve balance, or at least
equilibrium, in our budget process, but it's going to take a much
stronger growth rate and a handle on the entitlements in order to
get it done.
MR. RUSSERT: You're one of the few major Republicans in the
country who is against a constitutional amendment to balance the
budget. Why?
MR. KEMP: Well, I have never been enamored of putting a
budget-balanced amendment into the Constitution. I have felt in
the past that it was a trap to raise taxes.
Joe Barton, a congressman from Texas, has a balanced budget
amendment that is much closer to the reality of keeping a handle
on taxes, which are always raised, unfortunately, in recessions
at exactly the wrong time, and he has a tax limitation balanced
budget. I would not vote for the Stenholm balanced budget
amendment because it clearly is a trap into which I think a
future Congress would end up keeping taxes higher or raising
taxes in a recession, and that is --plus, there's no enforcement
mechanism.
We can balance the budget, and we're going to have to get a
handle on entitlements, get tax rates down, and have the economy
expand considerably while Alan Greenspan keeps a firm hand on the
control of money so we can have sound, honest money and low
interest rates for our future.
MR. RUSSERT: Are you concerned that the Democrats are going to
be on the floor of the Congress tomorrow saying, ``Hey, let me
quote Jack Kemp on the constitutional balanced budget. He's
against it, fellow Republicans"?
MR. KEMP: Well, no, they couldn't say that because clearly the
Barton amendment, which is much closer to what Jack Kemp would do
and send it to the states for debate, I think it'd be a healthy
debate.
But Barton's amendment clearly could be passed, sent to the
states for that debate. I certainly would not vote for the
Stenholm amendment, because it does not have tax, spending, or
borrowing limitations, and it's a recipe for future disaster for
this country.
MR. RUSSERT: In the '96 election, Clinton/Gore carried
Hispanics two to one over Dole/Kemp. The Republicans are being
perceived by some as, quote, ``anti-immigration," and both
parties have now provided that legal immigrants -- not illegal,
legal immigrants -- no longer be eligible for welfare benefits.
MR. KEMP: That has to be resolved. There are children and
disabled Americans who are legal immigrants who, as Giuliani, as
Mayor Riordan, and, I think, most Republican governors, as well
as Democratic governors, recognize they've got to do something to
resolve that debate.
Trent Lott is right, however. We should not reopen the welfare
legislation, because it would be abused, in my opinion. But you
can resolve the problem of legal immigrants getting necessary
care and make sure that there is a safety net under which they
should not be allowed to fall without opening that debate and
having the Congress run amok.
MR. RUSSERT: Are you concerned that Hispanics and other
immigrants in America are beginning to look at the Republican
Party in a negative way?
MR. KEMP: Well, immigrants did, too. We lost votes of
immigrant Americans who were here legally and, whether they were
Asian Americans or Latinos.
I think Father Hesburgh put it best when he said we should
close the back door of illegal immigration so we can keep open
the front door, the open door, the golden door of lawful
immigration, and this administration clearly has not done enough,
they're not doing enough, there are five million, according to
the latest reports, illegal immigrants. We've got to control our
borders. We have a right to do that, but the party has to show
that we are the party of the entrepreneurial immigrant spirit
that built America, and the way to do it is to do what Trent Lott
did and Spencer Abraham has done.
Put Spencer Abraham, who's a thoughtful, positive, inclusive
Republican conservative, at the head of the committee that will
see how we are going to help resolve this issue here at the end
of the 20th century.
MR. RUSSERT: Numerous allegations about the Clinton campaign
fundraising machine.
MR. KEMP: It was outrageous.
MR. RUSSERT: Do you believe they won the campaign fairly and
squarely?
MR. KEMP: Well, I'm a small-D democrat, and the people spoke
--I won't tell you what Mo Udall said back when he lost, but
clearly there were so many shenanigans, so many financial
irregularities. It's embarrassing to the president and the White
House. There's criminal investigations, and Fred Thompson is
going to hold congressional hearings, and I think fully funding
Fred Thompson's hearings is something that both Republicans and
Democrats should do so that we can get to the bottom of this and
find out what was fair and what was not fair.
But we lost, and our constitutional system gives the president
four more years, and now he's got to do something to clean it up,
because it is outrageous what's happening in America. It's a very
important issue.
MR. RUSSERT: Are you for serious campaign finance reform?
MR. KEMP: Oh, yeah. Oh, yeah. I did not run in '96, at least
for president, because of fundraising. There's too much soft
money. It should be eliminated, and PAC money from businesses and
unions
MR. RUSSERT: Eliminated.
MR. KEMP: in my opinion should be eliminated.
I don't go so far as the McCain amendment, because I don't
think that would actually work in practice, but something has to
be done to get the soft money and foreign money totally out of
American presidential politics and presidential elections.
MR. RUSSERT: Are you concerned that Washington is too awash in
scandal, however, with Newt Gingrich and Paula Jones and campaign
financing and on and on and on? Does it create an atmosphere with
the American people that they say, "Hey" --
MR. KEMP: There's a lot of poison in the air. My hope is and
my belief is that both Lott and Newt Gingrich are going to be
able to work with this president, get things done. There'll be
investigations that are ongoing, but I think the American people
want an end to the poison and a beginning to reforming education,
welfare, budget process, entitlements, and, particularly, the
reform that means a lot to the American people, get rid of the
IRS as we know it. We need tax reform in America so that working
class families can get true, permanent tax relief and we can get
this economy growing again.
MR. RUSSERT: Now I have some good news for you. Michael
Jordan, coming up, will say that he is not going to run for
president
MR. KEMP: (Laughs.) That's lucky.
MR. RUSSERT: -- so one former athlete will not take on
another, but Charles Barkley has said he will run for governor of
Alabama in the year 2002 as a Republican, most likely.
MR. KEMP: He should. He's an entrepreneur. He's a great
athlete and an entrepreneur. He ought to be in the party of
Lincoln, and I would love to have Charles Barkley in the
Republican Party, and I can't wait to see your roundtable with
MR. RUSSERT: Kemp/Barkley in 2000?
MR. KEMP: Or Barkley/Kemp.
MR. RUSSERT: Jack Kemp, we thank you for joining us today.
MR. KEMP: Thank you, Tim.
MR. RUSSERT: And Michael Jordan and Charles Barkley will talk
about kids and role models and teenage pregnancies --
MR. KEMP: (Inaudible; crosstalk) -- they're great role models themselves,
as Roger Staubach and people like John Mackey.
MR. RUSSERT: We thank you very much for joining us, and good
luck in your efforts.
MR. KEMP: Thanks, Tim.
END
ARMS Email System
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CREATOR: Margaret M. Suntum (SUNTUM_M) (WHO)
CREATION DATE/TIME:11-APR-1997 13:44:33.64
SUBJECT: CORRECTED DATE 04/11/97 Remarks by Pres to ASNE
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PRINTER FONT 10_POINT_COURIER
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#332 - 3/26/97
PRINTER FONT 12_POINT_COURIER
THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
April 11, 1997
REMARKS BY THE PRESIDENT TO THE ANNUAL MEETING
THE AMERICAN SOCIETY OF NEWSPAPER EDITORS
J.W. Marriott Hotel
Washington, D.C.
12:17 P.M. EDT
THE PRESIDENT: Thank you very much. And, thank you,
Bob, for reminding me of my best line from the speech last night.
(Laughter.) George Bush got the last laugh. (Laughter.) Twelve
thousand feet, not a scratch. I fell six inches, I'm hobbled for six
months. (Laughter.)
I'm delighted to be here. I want to thank you for
having me and congratulate this year's writing award winners. I
missed last year and I'm sorry I couldn't come, but the Vice
President told me all about it. And because he came here, I had to
listen one more time and look one more time at all those pictures
from his days as a long
-haired reporter for the National Tennessean.
(Laughter.)
This is what it's really like. I don't mind learning
about global warming and high technology and everything, but I had to
learn all about the newspaper business all over again. I hear that
speech about once every three months from him. (Laughter.)
You know, times have changed remarkably since Will
Rogers said, "All I know is what I see in the papers." Today, we
live in a world with 500 channels, literally hundreds of thousands of
web sites exploding all the time. We're trying to develop the
Internet, too. But, still, the role that you play in informing and
educating Americans and in helping them to make the right kind of
choices is terribly important.
I want to talk today about one of those choices that
will have a profound effect on all of our lives and the lives of our
children in the next century, and that is the choices we must make to
sustain America's leadership in the world.
Four years ago I came into office determined to renew
our strength and prosperity here at home. But I also believe that in
the global society of the 21st century, the dividing line between
foreign and domestic policy was increasingly an artificial
distinction. After all, our national security depends on strong
families, safe streets, and world
-class education. And our success
at home clearly depends on our strength and willingness and our
ability to lead abroad.
The conviction that America must be strong and involved
in the world has really been the bedrock of our foreign policy for
the last 50 years. After World War II, a generation of farsighted BOTTOM EVEN
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#332 - 3/26/97
leaders forged NATO, which has given us a half century of security
and played a strong role in ending the Cold War. They built the
United Nations so that a hard
-won peace would not be lost. They
launched the Marshall Plan to rebuild a Europe ravaged by war. They
created the World Bank and other international financial institutions
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to pave the way for unprecedented prosperity for American people and
others around the world. They did this throughout a half century,
Republicans and Democrats together, united in bipartisan support for
the American leadership that has been essential to the strength and
security of the American people for half a century now.
Now we stand at the dawn of a new century and a new
millennium -- another moment to be farsighted, another moment to
guarantee America another 50 years of security and prosperity. We've
largely swept away the blocks and barriers that once divided whole
continents. But as borders become more open and the flow of
information, technology, money, trade, and people across the borders
are larger and more rapid, the line between domestic and foreign
policy continues to blur.
And we can only preserve our security and our well
-being
at home by being strongly involved in the world beyond our borders.
From fighting terrorism and drug trafficking, to limiting the
proliferation of weapons of mass destruction, to protecting the
global environment, we stand to gain from working with other nations,
and we will surely lose if we fail to do so.
Just as American leaders of both political parties did
50 years ago, we have to come together to take new initiatives and
revitalize and reform old structures so that we can prepare our
country to succeed and win and make the world a better place in this
new era.
You know, it is commonplace to say that since the end of
the Cold War, America stands alone as the world's only superpower.
That is clearly true, but it can be dangerously misleading because
our power can only be used if we are willing to become even more
involved with others all around the world in an increasingly
interdependent world.
We must be willing to shape this interdependent world
and to embrace its interdependence, including our interdependence on
others. There is no illusory Olympus on which the world's only
superpower can sit and expect to preserve its position, much less
enhance it.
In my State of the Union address, I set out six key
strategic objectives for America's prosperity, security, and
democratic values in the 21st century. First, a Europe that is
undivided, democratic, and at peace for the first time in its
history. Second, strong and stable relations between the United
States and Asia. Third, our willing continuation of America's
leadership as the world's most important force for peace. Fourth,
the creation of more jobs and opportunity for our people through a
more open and competitive trading system that also helps others all
around the world. Fifth, increasing cooperation in confronting new
security threats that defy borders and unilateral solutions. And,
sixth, the provision of the tools necessary to meet these challenges,
from maintaining the world's strongest, most modern and most
adaptable military, to maintaining a strong, fully funded, and
comprehensive diplomacy.
On that last point, let me just point out that Secretary
Albright often says that our whole diplomatic budget is only about
one percent of the budget. We devote less of our resources to that
than any other major country in the world and, yet, about half of
America's legacy will be determined by whether we have the adequate
resources to do that.
That's a very important thing, because I think most of
your readers don't know that. They think we spend more and get less
out of our foreign policy investments when, in fact, we spend less
and get more than almost any other area of public endeavor.
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Each of these six goals is vital to realizing the
promise of our time and to guarding against its perils. Together,
they provide a blueprint for our future, not just for the next four
years but for the next half
-century.
In the next three months we'll face critical choices
that will determine whether we have the vision and will to pursue
these objectives. We have to seize the opportunity to complete the
mission America set out on 50 years ago and to push forward on the
mission of the next 50 years.
We will begin by strengthening the foundation for
security and prosperity in our own hemisphere. In the first of my
three trips to the Americas over the next year, I will meet with our
closest neighbors in Mexico, Central America, and the Caribbean to
help our democracies and economies grow together and to intensify our
shared fight against crime, drugs, illegal immigration, and
pollution.
Just before the 50th anniversary of the Marshall Plan, I
will hold a summit with the European Union to affirm our
transatlantic ties even as we expand our global partnership.
I will host the world's leading industrial democracies
at what we used to call the G
-7 but now call the Summit of the Eight
in Denver, which will give us an opportunity to deepen our
cooperation with Russia for peace and freedom and prosperity.
At the NATO summit in Madrid this July, we will continue
to adapt NATO to the demands of a new era and invite the first, but
not the last new members to join history's most successful alliance.
And I will continue America's efforts to bring the
parties together at this very difficult moment for peace in the
Middle East.
Like the larger agenda they support, each of these
initiatives calls for American leadership that is strong and
steadfast. The powerful trend toward democracy and free markets is
neither inevitable nor irreversible. Sustaining it will take
relentless effort. But leadership brings its rewards. The more
America leads, the more willing others will be to share the risks and
the responsibilities of forging the future we want.
In the last four years, we have seen that over and over
again. We've seen it in Bosnia. We've seen it in Haiti. We've seen
it in the Summit of the Americas and in the APEC Leaders Forum, where
we have agreed with our partners to build a free and open trading
system early in the next century.
Our leadership also faces two other pressing tests now
and in the coming months: first, immediately ratifying the Chemical
Weapons Convention; and then, giving the United States the means we
need to continue our growth by making trade more open and fair in the
global economy.
Let me deal with the first issue. For the last 50
years, Americans have lived under the hair
-trigger threat of mass
destruction. Our leadership has been essential to lifting that
global peril, thanks in large measure to the efforts of my
predecessors, and during the last four years also when we have
remarkable progress.
The collapse of the Soviet Union left 3,400 nuclear
warheads in Ukraine, Kazakhstan and Belarus. Today, there are none.
North Korea was accumulating material for nuclear weapons when I
became President. Now its nuclear program is frozen, under TOP EVEN
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international supervision, and eventually will be dismantled.
We helped to win the indefinite extension of the Nuclear
Nonproliferation Treaty, a powerful global barrier to the spread of
nuclear weapons and their technology. We led in concluding the
Comprehensive Test Ban Treaty, which will bring to life a decades
-old
dream of ending nuclear weapons testing.
President Yeltsin and I agreed in Helsinki to a roadmap
through the START treaties to cut our nuclear arsenals over the next
decade by 80 percent from their Cold War peaks, and actually to
destroy the warheads so they can never be used for destructive ends.
Now America must rise to the challenge of ratifying the
Chemical Weapons Convention, and doing it before it takes effect on
April 29th, less than three weeks from today.
This century opened with the horror of chemical warfare
in the trenches of World War I. Today, at the dawn of a new century,
we have the opportunity to forge a widening international commitment
to begin banishing poison gas from the earth, even as we know it
remains a grave, grave threat in the hands of rogue states or
terrorist groups.
The Chemical Weapons Convention requires other nations
to do what we decided to do more than a decade ago -- get rid of all
chemical weapons. In other words, the treaty is about other nations
destroying their chemical weapons. As they do so and renounce the
development, production, acquisition, or use of chemical arms, and
pledge not to help others acquire them or produce them, our troops
will be less likely to face one of the battlefields most lethal
threats. As stockpiles are eliminated and the transfer of dangerous
chemicals is controlled, rogue states and terrorists will have a
harder time getting the ingredients for weapons. And that will
protect not only military forces, but also innocent civilians.
By giving us new tools for verification, enabling us to
tap a global network for intelligence and information, and
strengthening our own law enforcement, the treaty will make it easier
for us to prevent and to punish those who seek to violate its rules.
The Chemical Weapons Convention reflects the best of
American bipartisanship negotiated under President Reagan and
President Bush, supported by a broad and growing number of Americans,
including every chairman of the Joint Chiefs of Staff since the
Carter administration. Last week at the White House, I was proud to
welcome a remarkable cross
-section of these supporters, including
former Secretary of State James Baker, General Colin Powell, other
military leaders, legislators, arms control experts and
representatives from small and large businesses, religious groups,
and scientists.
I urge the Senate to do what is right and ratify this
convention. If we fail to do it, we won't be there to enforce a
treaty that we helped to write, leaving our military and our people
more vulnerable to a silent and sudden killer. We will put ourselves
in the same column with rogue nations like Libya and Iraq that reject
this treaty, instead of in the company of those that set the norms
for civilized behavior in this world. We will subject our chemical
companies, among our leading exporters, to severe trade restrictions
that could cost them hundreds of millions of dollars in sales, and
cost many Americans good jobs. And perhaps most important, we will
send a clear signal of retreat to the rest of the world at the very
time when we ought to be sending the opposite signal.
America has led the effort to establish an international
ban against chemical weapons. Now we have to ratify it and remain on
the right side of history. If we do, there will be new momentum and
moral authority to our leadership in reducing even more the dangers
of weapons of mass destruction.
Within my lifetime we've made enormous strides.
Stepping back from the nuclear precipice, from the bleak time of
fallout shelters and air raid drills. But we have so much more to
do. We have to strengthen the world's ability to stop the use of
deadly diseases as biological weapons of war. We have to freeze the
production of raw materials used for nuclear bombs. We must give
greater bite to the global watchdogs responsible for detecting hidden
weapons systems and programs. Continuing this progress demands
constant work, nonstop vigilance, and American leadership.
There is a second matter that demands bipartisan
cooperation in the coming months. For 50 years, our nation has led
the world not only in building security but in promoting global
prosperity. Now we have to choose whether to continue to shape the
international economy so that it works for all our people, or to
shrink from its challenges. The rapidly growing and ever
-changing
global economy is an inescapable fact of our time. In the last 50
years, global trade has increased ninety
-fold. Over the next decade,
it is expected to grow at three times the rate of the American
economy. Nations once divided by great gulfs of geography and
military rivalry are now linked by surging currents of commerce.
Now, the world marketplace does pose stiff challenges.
But it offers us great opportunity. In each of the last three years,
the United States has been ranked the world's most competitive
economy. Our exports have surged to record levels, our budget
deficit is now the smallest as a share of national income of any
major economy in the world, basic industries have revived, our auto
industry is number one in the world again for the first time since
the 1970s. From semiconductors to biotech, to Hollywood, American
firms lead the industries that are remaking the world. Our economy
produced 11.5 million jobs in the last four years for the first time
ever. Our unemployment today is 5.2 percent; that's 1.5 percent
lower than the 25
-year average before I took office.
We can make the most of this new economic era. We do
not need to be afraid of global trade. But in a world where we have
only 4 percent of the population and where the fastest
-growing
markets for our products and services are Asia and Latin America,
where export
-related jobs pay 13 percent to 16 percent more than
other American jobs, we don't have a choice; we have to export.
To do that, we have to have higher skills, stronger
productivity, deeper investment. That's why we have to balance the
budget -- to keep our interest rates down, our investment up, and to
keep the economy going.
We have to give our people the best education in the
world. That's why we need the new national school standards. We
must open the doors of college to all. We ought to pass the G.I.
Bill for America's workers I've proposed that would give every
unemployed and underemployed person a skills grant to use and get
into training that he or she needs.
We must continue to expand research and development in
both the public and private sectors. And in every opportunity, we
have to press forward for more open international trade.
Our administration has concluded more than 200 separate
trade agreements, each of which opens someone else's markets wider to
American business. We fought for NAFTA, which created the free
market with our neighbors, and today, in spite of its economic
crisis, our exports to Mexico are up 37 percent over pre
-NAFTA
levels. We broke seven years of global gridlock and successfully
negotiated the new round of GATT, which has lowered average tariffs
on Americans goods around the world by one
-third. We have broken
down barriers and boosted exports to Japan -- up 41 percent since
1993 and 85 percent in the areas where we have negotiated specific
trade agreements.
This is a record to build on, not to rest on. When the
momentum for open market falters, the world can easily slide
backward. And when America falters, our relative position will
certainly slide backward. It is unacceptable for us to sit on the
sidelines while other nations forge bonds of trade. Only American
leadership can create the prosperity for our people and for the world
in the next 50 years. And America cannot lead if we don't act.
And here's what the issue is: Every American President
since 1974 -- Democrat and Republican alike -- has had the authority
to negotiate new trade agreements, called fast
-track negotiating
authority, which permits the agreement to be presented in a package
to the Congress to be approved up or down. Every time this has been
extended with the support of members of Congress of both parties.
That is how we have exercised our must fundamental economic
leadership. That authority has expired, and today, I renew my call
to Congress to give me the authority to negotiate new trade
agreements that will create opportunities for our workers and our
businesses in the global economy and will maintain our leadership in
creating the kind of world we want the young people who are here in
this audience to live in.
We have seen in the past six months what a strong trade
agreement can do for our people and our businesses. The information
technology agreement that we reached with 37 other nations in
December will eliminate tariffs and unshackle trade on $500 billion
of trade in computers, semiconductors, and telecommunications. This
amounts to a $5 billion cut in tariffs on American products exported
to other nations. It can lead to hundreds of thousands of high
-wage
jobs for Americans.
Now if Congress grants fast track authority, I can use
it to open trade in areas where American firms are leading and where
our future lies. We lead the world in high technology. In years to
come, we must press to tear down barriers that keep that technology
-- products like computer software, medical equipment, environmental
technology out of other markets.
We lead the world in agricultural exports. We have to
negotiate trade agreements to open even more markets. We will
negotiate a comprehensive free trade agreement with Chile and follow
through on our leadership to determine the future of trade in our own
hemisphere with our own neighbors, all of whom but one are
democracies. And we have to keep them that way and keep them strong.
We will press aggressively to open markets in Asia as
well. We must also continue to open opportunities in the world's
newest market economies. In particular, I urge Congress to support
my new partnership for freedom, to expand trade and investment,
entrench free markets in democracy, and promote stability in Russia
and the new independent states.
If we don't seize these opportunities, our competitors
surely will. Let me just give you one example. Last year, for the
first time ever, Latin American nations had more trade with Europe
than the United States. There is no reason to think that others will
wait while we sit idle.
These nations in Latin America especially are our
friends; they're our partners. They have done an enormously
important thing in moving to freedom and democracy in the last few
years -- all over Central and South America. We dare not let this
opportunity pass us by.
I am determined that the new trade agreements we seek
will be good for our working people. After all, we've got 11.5
million more jobs and 5.2 percent unemployment. We know we can make
it good for the American people. And I am determined that they will
be good for the environment. More and more, in the future, we will
see nations negotiating environmental partnerships for the sake of
their economies and the stability of their society and the future of
their children.
I have asked the United States Trade Representative,
Charlene Barshefsky, to work with members of Congress of both
parties, with labor and business and environmental groups to try to
reach consensus on these issues. But let me be clear: There is one
consensus we cannot avoid. We cannot shrink from the challenges of
leadership in the global economy.
Trade and communications are remaking our world.
They're bringing it closer together, they're bringing a revolution in
global trade -- because in the long run, we know that it's going to
happen, we ought to lead it. We have to lead it. And if we do, it
will increase our buying power and expand our exports. American
workers and businesses, given the chance, can outcompete anyone, and
I hope Congress will help me let them do just that.
The larger question we face is as old as America --
whether to turn inward or reach outward, whether to fear change
embrace it. Over the past 50 years, over the past four years, I
believe we've made the choices that have served America well.
Now we face another moment of choice. While we no
longer face a single implacable foe, the enemy of our time is
inaction. It is so easy to be inactive when things seem to be going
well and so easy to believe a new choice will cause more trouble than
it will do good. But we did not get where we are today by being
inactive or by sitting on the sidelines. The decisions we make in
the next few months will set America's course in the world for the
next 50 years. We have to make them together, and they must be the
right ones.
Thank you very much. (Applause.)
Q
Mr. President, the Commission on Protection and
Reduction of Government Secrecy -- the Moynihan Commission -- said
last month that 3 million people have the authority to classify
government secrets at a cost of more than $5.5 billion a year. The
commission called this a form of government regulation not controlled
by statute as is all regulatory power. And it said it should be
subject to the same guidelines and oversight as other regulation. To
provide a check on unrestrained discretion in creating secrets, the
commission recommended a law to codify the principles as to what can
be classified and what should not be classified and for how long it
should be classified, and to create a national declassification
center to provide annual reports on the progress in declassifying
government records, and to require the President to set procedures
and provide the resources for declassifying information.
Will you support enactment of such a law? If not, why
not? If so, how hard will you push for it?
THE PRESIDENT: Well, first of all, let me say, the
short answer to your question is: I think there has to be -- we have
to do something about it to respond to the commission's report and to
respond to the fact that there are too many people who can make too
many things classified in the government. And we are reviewing the
report. We have also started conversations with members of Congress
about it. And I'm we're attempting to fashion what we think is
the appropriate response. But let me remind you that I believe that
we ought to unearth more documents and not keep so many secrets for
so long.
I've worked very hard to open up documents since I've
been President. We did it with the human radiation experiments. We
have conducted a relentless effort to find out what really happened
in the Gulf War, in terms of whether our people were or were not and
to what extent exposed to dangerous chemicals. And in any number of
other ways, I support the general thrust of the commission's report.
I have asked my staff to study it. I have not received
a specific recommendation on the specific points in the report, but
generally I think there is too much secrecy in the government and I
think too many people have too much unfettered discretion just to
declare documents secret, and I think that you will see some
significant progress coming out of this.
Q
Mr. President, my county of 70,000 people is at
risk from 7 percent of the nation's stockpile of aging chemical
weapons, the nerve agents it's referred to. We don't have the
highways to evacuate we need to; we don't have the civil defense
infrastructure. The disposal plan is behind the time line.
Two questions. As a political matter, wouldn't it make
sense to bring even more intensive scrutiny to these sites? There
are eight sites scattered across the country; our whole nation is at
risk from the downside of the old chemical warfare. And as a moral
matter, doesn't it make sense for your administration to step up the
disposal and make sure that the highway infrastructure is in place
for escape routes and civil defense?
THE PRESIDENT: You've asked me a question no one's ever
asked me before, but I can tell you the answer to the first question
is, does it make more sense to bring more attention to the country
about it the answer to that is yes if, for no other reason, not
just because of what your people may be exposed to, but because one
of the reasons we decided to destroy all this before I ever came
along -- my predecessors made that decision, it was the right one
-
-is that you don't want even small amounts of these kinds of
chemicals in the wrong hands can be used for very bad things.
And let me also say now, on the second question, I
will have to go back and see what the facts are and see what we can
do to accelerate it. I don't know enough now to give you a sensible
answer, but you've asked a good question and I will get an answer and
I'll get back to you. And let me just make one other point on this.
Some of the opponents of the Chemical Weapons Convention say, well,
you know, you can't protect everybody against everything. Well, if
that were the standard, we'd never have any treaties and we wouldn't
pass any laws.
You know, still, some people may be able to cook up
chemical weapons in laboratories in their garages. But if you look
at what happened to the Japanese people, for example, when the
extremist sect unleashed the sarin gas in the Tokyo subway, it was a
devastating thing.
Now, maybe they could or could not do that once the
chemical weapons regime is fully in force and we have much tighter
restrictions on what can cross national lines. But one thing we know
for sure: Japan has already ratified this treaty because they have
suffered through this and they know even if somebody who has got a
half
-cocked idea and a home
-baked laboratory can go out and do
something terrible like this, there will be fewer incidents like this
if we pass the Chemical Weapons Convention.
And I think it's very interesting -- a lot of the
objections that have been raised to this convention in America were
totally dismissed out of hand in Japan, a country that has genuinely
suffered from chemicals like this in the hands of terrorists. But
that goes back to the question the gentleman from Alabama asked and
it's one of the reasons we want to destroy our stockpiles as quickly
as possible, because, in addition to the risks that people in the
area are exposed to, we want to minimize the chances that anybody
ever can get their hands on any of this for mischievous, evil
purposes.
Q
Mr. President, some opponents of the Chemical
Weapons Convention are arguing that, indeed, it would let the fox
into the henhouse; that is to say, a country, perhaps Iran, a
signatory, would gain access to our development techniques for making
chemical weapons, which are relatively simple, but more importantly,
to those regarding defenses against chemical weapons in the fields.
What is your response to that argument? And are you in any position
to negotiate a change of any sort in the document if that were
necessary to get the votes for ratification?
THE PRESIDENT: Well, first of all, it is -- let me
answer the second question first, and then I'll go back. In general,
obviously no one country can change the body of a treaty which has
already been ratified by other countries; we can't do that, and lots
of other countries have ratified it.
But every country is empowered to, in effect, attach a
set of understandings as to what the treaty means, and as long as
they're not plainly inconsistent with the thrust of the document and
don't vitiate it, they can go forward. And one of the things we've
been doing with a lot of the opponents and the skeptics of the treaty
-- Senator Helms, for example, and others raised, I think, 30
different questions in the beginning, and we have reached agreement,
I believe, in 20 of those 30 areas, and we've offered alternatives
that we believe are reasonable in the other areas.
Let me just say for those of you who may not understand
this, Iran is a signatory of the they have ratified the Chemical
Weapons Convention. Iraq and Libya have not and will not. The
concern is that if a country is attacked by chemical weapons and they
are part of the treaty, that all the rest of us have pledged to do
something to help them. And the concern would be well, what if
Iran is attacked by Iraq and the United States and Germany, for
example, give them a lot of sophisticated defense technology on
chemical weapons and they turn around and use the chemical weapons
against someone else. In other words, if they turned out to have
lied about their promise in the treaty. That's the argument.
We have made it clear that, as regards other countries,
we will not do anything to give them our technology not Iran, not
anybody -- and that what our response will be -- will be limited to
helping them deal with the health effects of the attack. We will
help people in medical ways and with other things having to do with
the health consequences.
So I believe that the compromise we have reached on
that, once it becomes fully public and the language is dealt with,
will be acceptable to at least most of those who have opposed the
treaty on that ground.
Mr. President, we seem to be following a policy in
Asia with communist countries like China and Vietnam of engagement
and trade. Even with North Korea now, we seem to be on the verge of
a breakthrough there possibly some aid because they're suffering
famine. And I wonder, though, when we turn to our own hemisphere, we
seem to follow a policy of embargo against we don't seem to, we
are -- following a policy of embargo against Castro's Cuba. And I
wonder, why is there an apparent difference in approach, and whether
trying to open Cuba up for active trade wouldn't be in line with the
kind of opening of market policies that you were suggesting a little
while ago?
THE PRESIDENT: Well, I think, first of all, as a
practical matter, with each of these countries, we do what we think
is in our interest and what is most likely to further our interest.
Secondly, the other three countries you have mentioned
have not murdered any Americans lately. We had a law that I strongly
supported -- the Cuba Democracy Act. I strongly supported it. I
thought it was absolutely the right policy. It strengthened the
economic embargo but also gave us a chance to open up relations to
Cuba and to take care of humanitarian problems, to facilitate travel,
to do all kinds of things. And we were implementing that law. It
gave the Executive requisite flexibility.
And in return for the Cuba Democracy Act, the Castro
government illegally shot down two planes and murdered Americans.
And so we changed our policy. Congress was outraged. They passed
the Helms
-Burton law, and I signed it regretfully, but not
reluctantly. And our policy toward Cuba, therefore today, is one
that was dictated by Cuba, not by the United States. And until I see
some indication of willingness to change, it's going to be very
difficult to persuade me to change our policy. And I would have a
different attitude toward China or Vietnam or North Korea if they
murdered any Americans. And I would hope you would want me to have a
different attitude toward them if they did.
Q
Mr. President, my son, Cody, is here with me today
and he's 11 years old, and his 5th grade class will be voting first
in the presidential elections of 2004. I wonder if you could share
with us a little bit of what you hope your legacy will be for him and
his class, since you will be just leaving office then, and also what
advice and suggestions you might give Cody's class and the other
young people of America on what they can do now to prepare themselves
to be productive citizens in the early next century.
THE PRESIDENT: Let me answer the second question first.
I think the following things I would recommend to the 5th graders to
prepare themselves for the 21st century. Number one, first and
foremost, be a good student. Learn all you can. Learn the hard
things as well as those that aren't hard for you. And stay out of
trouble. Don't do something dumb, like get involved with drugs or
alcohol or something that will wreck your life. Learn. Be a good
student.
Secondly, get to know people who are your age but who
are different from you, people of a different racial or ethnic group,
people of a different religion. Because you're going to live in the
most multi
-ethnic, multi
-racial, multi
-religious democracy in human
history. And how we handle that will determine whether the 21 st
century is also an American century. Still somewhat of an open
question, although I'm encouraged about it.
The third thing I would say is, learn as much as you can
about the rest of the world, because it will be a smaller world and
you will need to know more about it.
And the fourth thing I would say is, start to take the
responsibilities of citizenship seriously and find some way -- even
at the age of ten -- to be of service in your community, whether it's
helping some student in your school that's not learning as well as he
or she should or doing something on the weekends to help people who
are unfortunate. I think that we need to build an ethic of citizen
service into our young people.
Those are the four things I would advise him to do.
In terms of what I hope the legacy will be I hope
people will look back on this period and say that while I was
President, we prepared America for the 21st century basically in
three ways: that we preserved the American Dream of opportunity for
everybody who is willing to work for it; number two, that we
preserved America's leadership for peace and freedom and prosperity
in the world, and the world is a better place because of it; and
number three, that Americans are living in greater harmony with one
another as one America because we passionately advocated a respect
for people's differences and respect for our shared values, and we
made real progress in overcoming these divides and extremist hatreds
that have not only weakened our democracy but are virtually
destroying countries all around the world.
Or in a more pedestrian way, I hope at least people will
say, well, after Bill Clinton was President, at least we had a new
set of problems to deal with. (Laughter.)
In 1983, I was in Portland, Maine, at a governors
conference. And the former Senator and former Secretary of State,
Edmund Muskie, who recently passed away a remarkable man -- was
there. And we were having a visit and he said, you know, I loved
being a governor. In some ways I liked it even more than being a
Senator of Secretary of State; I liked running something.
And I said, how did you keep score, Senator Muskie; how
did you know whether you had succeeded or not? He said, I knew I had
succeeded if my successor had a new set of problems. (Laughter.)
And you think about it, we will always have problems; it's endemic to
the human condition and to the nature of life. The way you define
progress is if you get a new set of problems, and if you get over it.
And particularly on feel on this whole issue of how we
deal with our racial diversity. It's something, of course, that's
dominated my whole life because I grew up as a southerner. But it's
a very different issue now. It's more than black Americans and white
Americans. The majority of students in the Los Angeles County
schools are Hispanic. And there are four school districts in America
-- four -- where there are children who have more than 100 different
racial, ethnic, or linguistic backgrounds within the school districts
already.
So this is a big deal. And every issue that we debate,
whether it's affirmative action or immigration or things that seem
only peripherally involved in this, need to be viewed through the
prism of how we can preserve one America, the American Dream, our
shared values, and still accord people real respect and appreciation
for their independent heritages. It will be a great, great
challenge. It's a challenge that, by the way, I think the newspapers
of the country can do a lot to help promote in terms of advancing
dialogue, diversifying your own staffs, doing the things that will
help America to come to grips with what it means not to be a country
with a legacy of slavery and the differences between blacks and
whites, but to have grafted on to that not only the immigration
patterns of the early 20th century but what is happening to us now.
It is really potentially a great thing for America that
we are becoming so multi
-ethnic at the time the world is becoming so
closely tied together. But it's also potentially a powder keg of
problems and heartbreak and division and loss. And how we handle it
will determine, really -- that single question may be the biggest
determinant of what we look like 50 years from now and what our
position in the world is and what the children of that age will have
to look forward to.
Q
Mr. President, our region has been devastated by
job losses, mainly because of downsizing in the military. Could you
speak to the people of the Mohawk Valley, and perhaps other
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BOTTOM ALL
communities like ours, on how your trade policies will help revive
our stagnant economy and revive our spirits?
THE PRESIDENT: Well, let's talk about the downsizing of
the military and the trade policy. The trade policy alone won't
necessarily revive a place with a stagnant economy, because very
often the trade policy increases jobs in the places that are already
doing well -- because success will build on success. So the only way
it can help is if the people in the Mohawk Valley can identify
companies that are going to have to expand because of expanding trade
and try to get the expansions to locate there.
But what I think is important -- and I believe the
United States, first of all, has an extra obligation to communities
that have been adversely affected by military downsizing. And we
have worked very hard to accelerate the rate at which we work with
communities that have had military downsizing, to give them back the
resources that they can use to rebuild their communities. In many
places we've had a lot of success; in some places we haven't.
Secondly, I think it's important that in areas like
yours the United States gives greater economic incentives for new
investment to diversify the economy. One of the things that I have
asked the Congress to do in my balanced budget plan is to more than
double the number of empowerment zones and enterprise communities
from the numbers we have now in the new plan, so we can give real
incentives for people to invest their money and to create good,
stable, long
-term jobs in areas with high unemployment rates.
If there's anything else you can think of I can do, I'll
be happy to do it. If there's anything we should have done in the
defense downsizing to benefit your area that we haven't done, I'll be
happy to look into that. But I think the main thing we have to do at
the national level is to keep the economy strong and then to create
extra incentives for people -- like people we're trying to move from
welfare to work where I proposed some special incentives -- or for
places with high unemployment rates, so that we can more uniformly
spread economic opportunity.
When you see that America has a 5.2 percent unemployment
rate, that's very misleading. We have a lot of states with
unemployment rates below 4 percent now. We have within states a lot
of communities with unemployment rates below 5.2 percent. But we
still have places with unemployment rates of 7, 8, 9, 10, 12 percent.
And so the trick is to create the economic incentives that will even
out the investment patterns. And that's what I'm trying to do. And
if you can think of anything specific I can do to help you, I hope
you'll feel free to contact me and let me know.
Thank you very much. (Applause.)
END
1:03 P.M. EDT
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CREATION DATE/TIME:21-APR-1997 08:50:29.00
SUBJECT: CBS: Face The Nation, 4/20/97
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Message Creation Date was at 21-APR-1997 06:42:00
CBS "FACE THE NATION"
WITH HOST: BOB SCHIEFFER
JOINED BY GLORIA BORGER, U.S. NEWS & WORLD REPORT
GUEST: HOUSE MINORITY LEADER RICHARD GEPHARDT (D-MO)
AIRTIME: SUNDAY, APRIL 20, 1997
MR. SCHIEFFER: And good morning again. I want to take a minute here at the
beginning just to say welcome to Gloria Borger, who has often been a guest
questioner here on our broadcast. Today she officially joins CBS News as a
news analyst. She'll continue to write her column for U.S. News & World
Report, but we expect to have her here most every Sunday. And welcome to
you, Mr. Gephardt,
joining us this morning from your hometown in St. Louis.
Let me get right to the thing that everybody in Washington is talking
about, and that is last week Bob Dole loaning Newt Gingrich $300,000 from
his own personal fund to pay off this fine that Mr. Gingrich received from
the House ethics committee. Let me just ask you flatly: In your opinion,
is this a proper way for this to be handled?
REP. GEPHARDT: Well, I think it was right for the speaker to try to pay
these funds out of his own fund. Obviously this is a little bit of an
unusual arrangement, and the ethics committee, which has jurisdiction over
all of this is going to have to review it and decide whether or not it
meets our rules. If it does, fine. If it doesn't, maybe they can get some
adjustments in it.
MR. SCHIEFFER: Well, as I understand it, you can't buy a congressman a
dinner any more without having to report it. There's a limit on that. This
is
$300,000. Would this in your view be a gift?
REP. GEPHARDT: Well, I guess that's the question they have to look at.
What you want in any loan to a member is commercial reasonability, and
that's what they're going to have to look at. I've seen different opinions
by bankers and others -- some say this is not what they would normally do
for an ordinary citizen. Others say that it's within the realm of
reasonability. I think this is something our committee has really got to
look at and try to make a judgment about. I think it should be let to
them. They're the ones that know the rules.
MR. SCHIEFFER: Well, at this point though you haven't come to any judgment
about it?
REP. GEPHARDT: I haven't investigated all the terms, and I don't even
think the committee has looked at the loan documents. I don't think
they've actually been written or finally negotiated. So they've got to
look at actually what the words say, and then they can make up their mind
on whether it's right or wrong or in conformance with our rules.
MS. BORGER: Mr. Gephardt, now we are involved in watching these budget
talks, which seem to go on and on and on. And at the end of this last week
some folks were saying there was progress, some folks were saying there
wasn't progress. Do you believe that these budget talks should go on, or
should they just be cut off right now?
REP. GEPHARDT: Well, Gloria, the Republicans are way late on this budget.
They don't seem to be able to do a budget. They are way out of time. They
should have had a budget off the floor of both the House and the Senate by
now. The truth is half the Republicans want to just give big tax breaks to
the wealthiest Americans. The other half want to balance the budget by
cutting Medicare and education and the environment too deeply. They are
hopelessly split as to why they can't do a budget. They seem frozen. And I
think the
president ought to just say to them, "Bring us a budget."
This president has done more to try to get this done than you could ask
any human being to do.
MS. BORGER: So cut off these talks and say to the Republicans, "Come up
with your own budget"?
REP. GEPHARDT: I think they ought to continue to try -- if the president
feels he is making progress, then he ought to do that. But there's a point
here where -- you know, every week we hear from John Kasich or someone,
"Well, we're going to get it done by the end of this week." Then we go
another week. Now we are into a third week, and I heard him say on Friday
it's going to take two more weeks. We're going to be in December and
facing another government shutdown, which they say they don't want to do,
but that's where we're headed, if they don't get a budget done. They
should have had a budget off the floor by April the 15th.
MR. SCHIEFFER: You don't really think that the Republicans are going to
let the government shut down again, do you, Mr. Gephardt, in light of the
pounding they took the last time around when that happened?
REP. GEPHARDT: Bob, I didn't think they were going to do it a year and a
half ago, and they did. There were many of us who said this is crazy, this
shouldn't happen. They're going to be shutting down Social Security
offices and veterans offices and national parks. Yet they went ahead and
did it. And I saw one of the Republicans say recently their biggest
mistake was not carrying on with it.
MS. BORGER: Mr. Gephardt
REP. GEPHARDT: So there's a body of opinion I'm afraid in their party that
says, "Let's do it again it worked well."
MS. BORGER: Let me get to some specifics with you, because today's
Washington Post outlined some of the specifics that might be in a deal.
And if you could very quickly tell us what you can live with and what you
can't live with. Medicare cutbacks of up to $135 billion - can you live
with that?
REP. GEPHARDT: Gloria, the test on Medicare, and really all of these
issues, is how does it affect people. The numbers aren't as important,
it's what actually happens to real people.
MS. BORGER: But does that seem high to you? Is that in the ballpark? REP.
GEPHARDT: It seems high to me. It seems high to me, because one you get
above the levels where the president was in his budget, you really are in
the area where you are starting to raise premiums, raise co-pays, raise
deductibles - things that you don't need to do to save Medicare, things
that you don't need to do unless you have these huge tax cuts for the
wealthiest Americans.
MS. BORGER: They're also talking about some slight adjustments in the
cost-of-living index. So could you live with that, that being lowered a
touch?
REP. GEPHARDT: Well, Gloria, you know what I believe about this. I think
I've talked to you and others about it. I really think that if we are
going to have integrity in government we have to let the agency in
government that has always set this Consumer Price Index to do that, and
not have a political fix for the sake of giving a tax cut to somebody, or
doing something else in the budget. People need to believe that their
government has integrity. And a Consumer Price Index is a scientific
research project. Let's let the Bureau of Labor Statistics that has always
done this do it. Let's not have some arbitrary fix because we can't figure
out the budget somewhere else.
MR. SCHIEFFER: Mr. Gephardt, could you in any way go along with some kind
of a cut in the capital gains tax, because that seems to be one of the
things that the Republicans really want.
REP. GEPHARDT: Well, Bob, again, the test should be who does it help and
how does it affect people. If to give a big capital gains tax cut, like
cutting it in half, or as Newt Gingrich said getting rid of the tax
altogether, you really then are having then to cut Medicare, education or
other vital programs for the good of people in order to give a tax break
to the wealthiest people in the country.
Now, if there is a way to focus, as I think the president is trying, a
capital gains tax cut on middle-income Americans, for things like buying
homes, then that's something you have to seriously consider. But, again,
if all we're doing is getting people who are already at the top of the
ladder making millions dollars a year, a huge $20,- to $30,000 a year tax
cut, and we're having to cut Medicare and education to pay for it, it
simply doesn't make good sense.
MR. SCHIEFFER: Let's talk about something else the Republicans are talking
about, and that is a reduction in estate taxes, or what they call death
taxes, the taxes a person has to pay when one of their relatives dies. Do
you see any kind of help there for taxpayers?
REP. GEPHARDT: Well, Bob, Democrats and Republicans agree that we need to
take a look at the estate tax and help small businesses and small farmers
that are trying to pass their business from one generation to the other.
But understand what the Republicans are talking about is simply getting
rid of the estate tax. Let me tell you what that does. That would give
$4.6 billion a year in tax relief to 1,700 of the wealthiest families in
the country. And, again, you'd have to pay for this in the budget by cuttin
g education or school lunches, or day-care programs or Medicare and
Medicaid. You know, I -- it's outrageous. It absolutely takes my breath
that Republicans could make suggestions like this when we are trying to
balance the budget in good faith
and we are trying to do it by not taking it --
MS. BORGER: Mr. Gephardt?
REP. GEPHARDT: -- out of senior citizens and kids.
MS. BORGER: Mr. Gephardt, but it's not only Republicans. It's also your
president. And what I am hearing is your little nervous in this in fact
that your Democrats could revolt against any budget deal that the
president might
sign onto. Are you worried about that?
REP. GEPHARDT: I'm really not. I have worked with this president for four
years now. This is the fifth year we worked together. I think
I know what he believes in and what he cares about, and I do not believe
he is going to sign onto a budget deal that really cuts back on education
and training, which he feels very strongly about, and he thinks should be
a bipartisan issue, cuts back on Medicare and Medicaid in order to give
tax cuts to the wealthiest Americans.
Now, understand, Gloria, he wants to get the budget done, and I admire him
for reaching out and working as hard as he is to get it done, but he is
not willing to be for a bad budget, and he's not willing to sacrifice
these important principles.
MR. SCHIEFFER: All right, let's take a break here. We'll come back in a
minute and talk about some other things in just a minute.
(Announcements.)
MR. SCHIEFFER: And we're back again with Congressman Dick Gephardt, the
leader of the Democrats in the House of Representatives.
Let me ask you one question. We were told that when the president
announced that he was ready to make another $18 billion in savings on
Medicare that you and some of the Democrats told him that was simply too
much and that you were a little upset that he had announced this without
consulting with you. Is that or is that not true?
REP. GEPHARDT: There was a little miscommunication. We didn't get the
information before it was actually released to the public and to the other
members of Congress. But that's not a problem. These things happen. The
president is trying to get a budget deal. I don't see anything in his
proposal that really does the things that we're most worried about, which
is doubling premiums and so on. So this is not a problem. This president
is trying to get a budget deal, and that's what he ought to do.
MR. SCHIEFFER: All right, I guess the more important question to ask you
then is: Are you going to be able to go along with him on that? You don't
think he's gone too far?
REP. GEPHARDT: We haven't finished studying the proposal. It looks to me
like it does not raise premiums on Medicare recipients or double co-pays
and deductibles. It looks like we can make that work. But when you get
beyond that figure you are then getting into really hurting Medicare. You
know, I talked to a Medicare recipient here in my district yesterday, and
she said, ``Understand I can't pay my heating bill now, so anything you do
on this is really going to affect me." You've got to keep those people in
mind as you make these decisions.
MR. SCHIEFFER: Let me just ask you one other question, just because
I was thinking about this. You know, when the Republicans announced their
plans to scale back Medicare or to reap these savings in Medicare, you and
the other Democrats really pounded them on that, and they said unfairly.
You said that they were cutting Medicare -- they weren't making savings;
they were cutting it. When the president announces $18 billion in savings,
is that a cut or is
that something else? How do you describe that?
REP. GEPHARDT: Bob, there's a real distinction, and it's right to ask that
question. The distinction is the Republican proposal really hurt people.
It doubled premiums, co-pays, deductibles. Now, we are talking about
senior citizens, many of whom will live on their Social Security alone,
who can't pay their bills today, who would be severely impacted by that.
And, again, it
wasn't needed to balance the budget. It wasn't needed save Medicare.
MR. SCHIEFFER: But you're saying that when the president announces it it's
something different?
REP. GEPHARDT: The president's proposal takes the cuts away from providers
of Medicare services hospitals and doctors. It's a very different
proposal.
MR. SCHIEFFER: All right.
MS. BORGER: I just want to switch subjects a little bit if I might. The
president is going to go to Mexico in May. You have been an opponent of
NAFTA, which is something he's really pushed and promoted. You've been to
Mexico -- is NAFTA a failure?
REP. GEPHARDT: NAFTA is not working the way we had all hoped it would. In
my view, trade treaties, especially free trade treaties like this one is,
need to be a force for progress. By that I mean moving Mexico's wages and
environmental standards and enforcement up to us rather than us falling to
lower levels.
MS. BORGER: So NAFTA has failed then?
REP. GEPHARDT: It's not working as well as it could and should. We need to
fix it. We need to fix other treaties we do with other countries in the
region, and that's what I am trying to get --
MS. BORGER: So you would not be for this so-called fast-track authority
then? REP. GEPHARDT: I think we need to be honest and clear about what
kind of
treaties we can and will support. And what I want to say in the fast track
is that if we are going to have provisions on labor and environmental
standards, let's put it in the core trade treaty itself and have trade
sanctions to enforce it, as we do incidentally with intellectual and
capital property, which businesses have always insisted be in trade
treaties. We need the same for labor and the environment.
MR. SCHIEFFER: We should point out that what you're talking about when you
talk about this fast track, this is on the question of whether to bring
Chile,
the country of Chile --
REP. GEPHARDT: But, Bob --
MR. SCHIEFFER: -- into the NAFTA agreement.
REP. GEPHARDT: That's right. But the president is asking for general
authority to go and I assume and hope try to get free trade treaties
with other countries in Central and South America, and maybe around the
world. But
-- I'm not against that --
MR. SCHIEFFER: Yes.
REP. GEPHARDT: But I am against giving a general authority that doesn't
clearly state what Congress wants in these treaties. We don't need to box
ourselves into a situation, as I think we did with NAFTA, where we weren't
clear about what we wanted to have in these treaties.
MS. BORGER: So you will oppose the president on you have opposed the
president on NAFTA. Most-favored nation status --you still remain opposed
to that?
MR. SCHIEFFER: In regard to China.
MS. BORGER: China.
REP. GEPHARDT: But, Gloria, we are trying to work to find a way we can get
a fast track which reflects these concerns and has the right language in
it. And I'm going to work hard to do that. If we can't do it, then I will
oppose fast track. I voted against MFN for China last year. I think again
we have got to send a very clear message that human rights and workers'
rights are trade issues and they are inextricably intertwined.
MR. SCHIEFFER: How much does this come from the fact that you are thinking
about running for president next time out, and clearly Vice President
Gore would be your main opposition? Are you running for president, or when
will you make that decision?
REP. GEPHARDT: Bob, these are positions and issues that are in front of us
right now, and they are really important. I've had these positions for a
long time. I feel very strongly about these things. The president and I
agree on most of the things that come before the Congress. You are always
going to have an occasional disagreement, and both of us will and need to
stand and fight for what we believe in. But we work well together. We do
not need to be talking about races way out in the future. We need to c
oncentrate on what is in front of us.
MR. SCHIEFFER: You're spending a lot of time thinking about the year 2000,
are you not?
REP. GEPHARDT: I'm not. I'm not.
MR. SCHIEFFER: You mean, you haven't even thought about maybe you might
run for president?
REP. GEPHARDT: Bob, we've --
MR. SCHIEFFER: You'd be the only person in Washington who would say that
if that were true.
REP. GEPHARDT: Bob, there's an obsession in the media I'm not blaming
anybody there. But there is an obsession with political races way out in
the
future. What we need to --
MR. SCHIEFFER: But would you like to --
REP. GEPHARDT: -- obsess on in this country --
MR. SCHIEFFER: -- take yourself out of the race?
REP. GEPHARDT: -- what we need to work on -- what we need to work on are
the issues that are in front of us education, health care for kids,
trying to get this budget finished. Those are the things I'm out here
in the district. I'm going door to door this afternoon. I'll bet you I
will only hear about those issues.
MS. BORGER: Mr. Gephardt Mr. Gephardt okay, let's focus on some
races that you are talking about. You would like to become speaker in 1998
REP. GEPHARDT: I'm for it.
MS. BORGER: Right? You need a net gain of 11 seats. And you are out there
campaigning. How much of a drag is this Democratic fund-raising scandal?
REP. GEPHARDT: I don't hear it. Again, when you come into the country and
talk to citizens they talk about the things that they're grappling with
everyday that really have them concerned -- jobs, wages, education, health
care, their pensions, the environment, crime -- those are the issues that
people talk to you about. I'm not saying we shouldn't investigate all of
this. But, you know, on campaign reform we shouldn't just look backwards.
We ought to look forwards. And that's why we are trying to get the Rep
ublicans to put this issue on the agenda and let the House vote on
campaign reform in the next two months.
MS. BORGER: You're not worried that these hearings are going to focus so
much on the Democratic Party that it could trickle down to your
congressional candidates and your ability to recruit congressional
candidates?
REP. GEPHARDT: The hearings should be fair, they ought to look at all the
wrongs that were done on both sides of the aisle. I think there's plenty
of blame to pass around. We ought to fix the problems that were there.
But, most importantly, we ought to look to the future. We need to get
campaign reform. I am very much for it. I think most of our Democratic
members are for it. There are Republican members who are for it -- maybe a
minority but a few. Let's get a bipartisan majority together, and let's
once and for all get campaign reform that limits the amount of money that
can be spent in campaigns. We have to do it.
MR. SCHIEFFER: All right, we're about out of time. But I want to go back
to this one thing. I want to make sure I understood you right: You have
not given any thought to running for president in the year 2000?
REP. GEPHARDT: Bob, I am really and honestly elected here in St. Louis to
look at the problems that my constituents face. It would be
counterproductive to be worrying about, thinking about, spending time on
something else. This is the job that I am doing, and I am pleased and
honored to have the chance to do it.
MR. SCHIEFFER: All right, thanks very much, Mr. Gephardt. We are going to
leave it there.
END
Clinton Presidential Records
Automated Records Management System
[EMAIL] and Tape Restoration Project [Email]
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marker by the William J. Clinton Presidential Library Staff.
This marker identifies a responsive email, already made available
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Collection: 2019-0151-F
Bucket: Default
Creation Date: 1997-05-01
Subject: 1997-05/01 BRIEFING ON MEXICO
VISIT/BERGER/RUBIN/MCCAFFREY
Creator: Margaret M. Suntum SUNTUM_M WHO
ARMS Email System
RECORD TYPE: FEDERAL (NOTES MAIL)
CREATOR: [email protected] ([email protected] UNKNOWN
CREATION DATE/TIME: 2-MAY-1997 09:06:04.00
SUBJECT: News Hour With Jim Lehrer, 5/1/97
TO: Susanne Bachtel (CN=Susanne Bachtel/OU=OSTP/O=EOP [ OSTP 1)
READ:UNKNOWN
TEXT:
Message Creation Date was
NewsHour With Jim Lehrer: SOUTH OF THE BORDER
Aired on MAY 1, 1997
President Clinton is preparing to travel to Mexico, Costa Rica and
Barbados intended to strengthen relations with Latin American allies. To
preview the president's trip, Charlayne Hunter-Gault engages Mack McLarty,
America's special envoy to the Amercias, in a Newsmaker interview.
CHARLAYNE
HUNTER-GAULT: The
President and his
entourage embark on a
three-stage trip next
week. First stop is
Mexico, then to Costa Rica for a meeting with
leaders of Central American nations, and Barbados
as the last stop for a meeting with Caribbean
leaders. Here to talk with us about what !,s at stake
for the United States in this trip is President
Clinton !,s special envoy to the Americas, Mack
McLarty. And thank you for joining us.
MACK McLARTY, Special Envoy for the
Americas: Charlayne, I !,m delighted to be here,
thank you.
CHARLAYNE HUNTER-GAULT: All right.
Let !,s start with Mexico, your first stop. What is at
stake there for the U.S.?
MACK McLARTY: Charlayne, Mexico is a
neighbor. We share nearly a 2,000-mile border
with Mexico. They are a partner and a major
partner. They !,re our third largest trading partner.
About 700,000 Americans are--jobs are directly
linked to our exports with Mexico--
CHARLAYNE HUNTER-GAULT: 7000?
MACK McLARTY: 700,000.
CHARLAYNE HUNTER-GAULT: 700,000.
MACK McLARTY: Yes;
700,000 jobs directly
linked with trade with
Mexico. And those export
jobs generally, on average,
are much better paying
jobs and are really in many ways the keys to our
economic future. And finally, Mexico is our friend.
We share a very rich cultural link with Mexico, and
we see an increasing Hispanic population in our
country and an increasing Hispanic influence in our
leadership positions here. So it !,s a very important,
critical relationship.
CHARLAYNE HUNTER-GAULT: But I
understand that that relationship has suffered a little
rocky road because of Mexico !,s failure to make
any progress on the drug problem. Is the president
taking a peace offering?
MACK McLARTY: I don !,t think I would
quite--quite put it in that way. I think the
relationship is a broad one, is a deep one, and is an
increasingly maturing relationship that gives us an
ability not only to talk about the opportunities but
to talk about the complicated and difficult issues
like immigration and to talk about problems that we
share like narcotics and narcotics trafficking.
CHARLAYNE
HUNTER-GAULT: So
you !,ve gotten over
whatever issues you had
on that?
MACK McLARTY: Charlayne, I think the issue of
drugs, which is both a supply and a demand
problem. It is a very dark and a very evil force that
affects the very fabrics of our society, both here in
the United States and in Mexico. So I think first we
will talk in a very serious way about identifying the
problem, and then discuss how we can work
together, make cooperation work against a very
serious and negative force on both our societies.
CHARLAYNE HUNTER-GAULT: Let !,s move on to Central America. There !,s lots
more to talk about with Mexico, but we got to run through this whole trip.
What !,s it
take in that region of seven countries, Central America?
MACK McLARTY: Charlayne, this is a time of great promise and hope in
Central
America. I have been there twice in recent weeks. It is the first time we
have seen
peace and stability in that region in 36 years. And with that, comes great
promise of
economic development, and, of course, it is a beautiful part of our world
and has some
of the most wonderful environmental sites and rain forest and other
aspects of that type
literally in the world.
CHARLAYNE HUNTER-GAULT: So what are you pursuing there?
MACK McLARTY: Well, first of all, I think the agenda will
be, one, to establish a deeper and a broader partnership in a
region that is not only experiencing peace but is working much
more closely and cohesively together, fundamental trading and investment
relationships particularly now with stability in the
region. Secondly, there are a number of mutual projects,
particularly in the environmental area, that we will be working very
closely with, the
Central Americans on this trip, and of course beyond.
CHARLAYNE HUNTER-GAULT: Well, you mentioned illegal immigration a few
moments ago in connection with Mexico. But in this whole region, three
quarter of the
illegal immigrants who come to this country come from there. Is the
President going
with some plan for that?
MACK McLARTY: I think immigration will be discussed on all three
presidential visits
to the region, Charlayne. We, of course, in the United States are the most
open
country. We are a nation of immigrants. But what we are talking about is
enforcing the
laws that deal with illegal immigration. We want to continue to have legal
immigration
that is the source of richness and culture and productivity in our
country. But to do
that--but to do that we must enforce the laws--our current laws, which
frankly tighten
the immigration laws in a very effective way.
CHARLAYNE HUNTER-GAULT: So you !,11 be discussing--
MACK McLARTY: On all three stops. But always enforcing those laws with
respect
for human rights. That !,s part of our heritage and democratic principles
as well.
CHARLAYNE HUNTER-GAULT: Although some
critics--columnists I !,ve read--have said that the U.S.
has
allowed the drug problem to overshadow human rights and democracy.
MACK McLARTY: I would not agree with that. I think the very key throughout
this entire region when we !,11 be
traveling
to Latin America in the fall and then to Chile in 1998 for the convening
of the Summit
of the Americas--that !,s really been the President !,s consistent and
comprehensive
program here--and the key is to deepen these partnerships, to affirm
democracy, and
to make cooperation work, all the while building trade opportunities.
CHARLAYNE HUNTER-GAULT: Recently at a meeting in Atlanta, heads of state
and former heads of state of the region urged that the President act
swiftly to pursue
getting the negotiating authority to expand free trade in a faster way.
What will you tell
them about that? They all want to be, you know, like Mexico, a part of
NAFTA, the
North American Free Trade Agreement.
MACK McLARTY: Well, the region is a very--a very expansive region in terms
of its
economic development, Charlayne. Our exports to Latin America are growing
at about
twice the rate of our exports to any other region in the world. It is a
natural market for
us, but it is not--it is not a market we can take for granted. We have
competition in the
region, and from both the Europeans, the Japanese, and other very
interested parties,
so it is essential-it is essential we move ahead with broad fast track
authority.
CHARLAYNE HUNTER-GAULT: Do you think the U.S. is in danger of losing out
to those other countries because it hasn !,t moved on this?
MACK McLARTY: Economic integration is taking place in a
global economy, and so we !,ll either lead or be led behind, but
the real fundamental point here, it is in the fundamental interest
of the hard-working men and women in this country for us to
be able to open markets and provide jobs and good-paying
jobs just like we talked about with the 700,000 jobs that are
linked to our trade with Mexico.
CHARLAYNE HUNTER-GAULT: Well, what !,s the president prepared to say to
them?
MACK McLARTY: Well, I think he !,s already set a firm foundation in place
in 1994,
when he convened the Summit of the Americas in Miami, and one of the real
fundamental successes of that meeting with the 34 democratically-elected
heads of
state was the establishment of a goal of a free trade area by the year
2005.
CHARLAYNE HUNTER-GAULT: They want it now.
MACK McLARTY: No. I think they understand that this is a step-by-step
process,
and it is also a reciprocal process, Charlayne, where they open their
markets. Our
markets are the most open in the world. So I think the ten years to move
to this free
trade area, all the while making progress, is essential.
CHARLAYNE HUNTER-GAULT: Finally, let !,s move to the Caribbean. What !,s
at stake there, briefly?
MACK McLARTY: Well, the Caribbean, of course, is linked to our country
both geographically and also culturally.
They
have a long history of democracy, but the real
fundamental
challenge here, it seems to me, is twofold. First of all, you have some
smaller
economies in the world that are very close, and we !,re trying to integrate
carefully and
orderly with the largest and most powerful economy in the world. Secondly,
we have a
very direct interest in achieving a partnership in terms of how we fight
narcotics and
particularly drug trafficking through the Caribbean region.
CHARLAYNE HUNTER-GAULT: Yeah, but they !,re all upset because the United
States wouldn !,t support them in their efforts to support their banana
crops which they
say they need so that they don !,t have to grow marijuana.
MACK McLARTY: Well, I think it !,s, No. 1, we have always been concerned
about
the transition of those smaller economies. And you !,re right. In some
cases the banana
crop is 50 percent of some of the smaller island economies. But the real
heart of the
matter is certainly not, Charlayne, with the Caribbeans. The heart of the
matter is the
discriminatory practices of some markets that simply do not let certain
products in, not
just bananas but across the board. I was in Barbados, and I think we will
make
substantial progress in this area.
CHARLAYNE HUNTER-GAULT: Well, we !,11 look forward to that.
MACK McLARTY: As will we.
CHARLAYNE HUNTER-GAULT: Thank you, Mack
McLarty, for being with us.
MACK McLARTY: Charlayne, thank you.
ARMS Email System
RECORD TYPE: FEDERAL (NOTES MAIL)
CREATOR: Susanne Bachtel (CN=Susanne Bachtel/OU=OSTP/O=EOP [ OSTP D
CREATION DATE/TIME: 5-MAY-1997 10:17:33.00
SUBJECT: Update on video request for Chemical Manufacturers
TO: Susanne Bachtel CN=Susanne Bachtel/OU=OSTP/O=EOP @ EOP [ OSTP )
READ:UNKNOWN
TO: Timothy L. Newell CN=Timothy L. Newell/OU=OSTP/O=EOP @ EOP [ OSTP
READ:UNKNOWN
TO: Gerald L. Epstein (CN=Gerald L. Epstein/OU=OSTP/O=EOP @ EOP [ OSTP
READ:UNKNOWN
TO: Rebecca Dittmar (CN=Rebecca Dittmar/OU=OSTP/O=EOP @ EOP [ OSTP D
READ:UNKNOWN
TO: Bruce W. MacDonald (CN=Bruce W. MacDonald/OU=OSTP/O=EOP @ EOP [ OSTP
READ:UNKNOWN
TO: Jeffrey M. Smith (CN=Jeffrey M. Smith/OU=OSTP/O=EOP @ EOP [ OSTP ])
READ:UNKNOWN
TEXT:
Jerry - since Jeff Smith is assuming the Cong. Affairs/Media Relations
post at OSTP, he should be in on these kinds of deliberations from now on
- so am cc'ing him on your update. Thanks. Sue
Forwarded by Susanne Bachtel/OSTP/EOP on 05/05/97
10:18 AM
Gerald L. Epstein
05/05/97 10:03:11 AM
Record Type: Record
To: Susanne Bachtel/OSTP/EOP, Timothy L. Newell/OSTP/EOP
cc: Kerri A. Jones/OSTP/EOP, Bruce W. MacDonald/OSTP/EOP, JoAnn
Ward/OSTP/EOP
Subject: Update on video request for Chemical Manufacturers
UPDATE:
I contacted the Chemical Manufacturers Association to say that the
President would not be able to travel to Greenbriar, WV to address the
CMA's annual meeting on June 5, but that we were recommending that the
President send videotaped greetings. I said we had not gotten approval
for the video yet, but that I would like to get some information from them
on which to base the President's remarks assuming that we will get
approval.
I spoke to Fred Webber, CMA's President today and found out that CMA is
not interested in a video -- they have had poor success with them in the
past (not further elaborated). If the President could not travel there,
he said, they would love to have a 15-minute live hookup with him. He
explained that there would be over 1000 CEOs from the worldwide chemical
industry, from over 100 countries. When asked what they would like the
President to talk about, he said in addition to serving as a Chemical
Weapons Convention victory party, the meeting would provide the President
an enthusiastic audience to hear about his trade policies. The chemical
industry is a global one; the CMA members are strong fans of free trade in
the Americas and fast track approval for trade agreements, which the
President is requesting. They noted and appreciated Speaker Gingrich's
recent comments supporting fast track authority.
If the President were able to do a video feed, Webber said that Senator
Jay Rockfeller would introduce him. After the President's remarks, the
program would go back to Rockefeller. If the President could not do the
video feed, Rockefeller would give the keynote address.
I told Webber I would have to check with the President's schedulers. (I
don't even know if he is in the country on the evening of June 5.)
WHAT HAPPENS NEXT:
I have already contacted Wendy Gray, in Tony Blinken's office at NSC, to
explain this and have her withdraw the request for the video from the
Scheduling office. (The request went to Scheduling from the NSC Executive
Secretariat.) We agreed that neither OSTP nor NSC would be appropriate
sponsors of a request to have the President give a live video feed.
Nevertheless, it seems plausible that someone else in the White House
might want to push for a Presidential live feed from the trade perspective.
Wendy will try to find someone in the Domestic Policy Council to run this
by, and she will ask Tony Blinken when he comes up for air from a speech
he is crashing on what other suggestions he has. Should we otherwise just
bump this back to Scheduling, or should we ourselves try to find someone
else in the White House to hand this over to? USTR? NEC?
ARMS Email System
RECORD TYPE: FEDERAL (NOTES MAIL)
CREATOR: Gerald L. Epstein (CN=Gerald L. Epstein/OU=OSTP/O=EOP OSTP
CREATION DATE/TIME: 5-MAY-1997 15:44:57.00
SUBJECT: Update on video request for Chemical Manufacturers
TO: Jeffrey M. Smith (CN=Jeffrey M. Smith/OU=OSTP/O=EOP @ EOP [ OSTP 1)
READ:UNKNOWN
CC: Bruce W. MacDonald (CN=Bruce W. MacDonald/OU=OSTP/O=EOP @ EOP [ OSTP )
READ:UNKNOWN
TEXT:
Jeff, I think Susie Bachtel forwarded you this email, which I should have
remembered to send you directly. By way of background, several months ago
the CMA wrote the White House requesting that the President speak before
their annual meting. Scheduling forwarded the request to us. In
response, OSTP and NSC put in a request to Scheduling for a video from the
President in lieu of a personal appearance. However, I just found out
this morning that CMA is not interested in a video recording. As
described below, they'd prefer a live video feed. Since (as described
below) this is now more of a trade issue than a science or foreign policy
on, do you have any suggestions as to who in the White House I should
forward the Chemical Manufacturers Association request to?
Jerry
Forwarded by Gerald L. Epstein/OSTP/EOP on 05/05/97
03:43 PM
Gerald L. Epstein
05/05/97 10:03:11 AM
Record Type: Record
To: Susanne Bachtel/OSTP/EOP, Timothy L. Newell/OSTP/EOP
cc: Kerri A. Jones/OSTP/EOP, Bruce W. MacDonald/OSTP/EOP, JoAnn
Ward/OSTP/EOP
Subject: Update on video request for Chemical Manufacturers
UPDATE:
I contacted the Chemical Manufacturers Association to say that the
President would not be able to travel to Greenbriar, WV to address the
CMA's annual meeting on June 5, but that we were recommending that the
President send videotaped greetings. I said we had not gotten approval
for the video yet, but that I would like to get some information from them
on which to base the President's remarks assuming that we will get
approval.
I spoke to Fred Webber, CMA's President today and found out that CMA is
not interested in a video they have had poor success with them in the
past (not further elaborated). If the President could not travel there,
he said, they would love to have a 15-minute live hookup with him. He
explained that there would be over 1000 CEOs from the worldwide chemical
industry, from over 100 countries. When asked what they would like the
President to talk about, he said in addition to serving as a Chemical
Weapons Convention victory party, the meeting would provide the President
an enthusiastic audience to hear about his trade policies. The chemical
industry is a global one; the CMA members are strong fans of free trade in
the Americas and fast track approval for trade agreements, which the
President is requesting. They noted and appreciated Speaker Gingrich's
recent comments supporting fast track authority.
If the President were able to do a video feed, Webber said that Senator
Jay Rockfeller would introduce him. After the President's remarks, the
program would go back to Rockefeller. If the President could not do the
video feed, Rockefeller would give the keynote address.
I told Webber I would have to check with the President's schedulers. (I
don't even know if he is in the country on the evening of June 5.)
WHAT HAPPENS NEXT:
I have already contacted Wendy Gray, in Tony Blinken's office at NSC, to
explain this and have her withdraw the request for the video from the
Scheduling office. (The request went to Scheduling from the NSC Executive
Secretariat.) We agreed that neither OSTP nor NSC would be appropriate
sponsors of a request to have the President give a live video feed.
Nevertheless, it seems plausible that someone else in the White House
might want to push for a Presidential live feed from the trade perspective.
Wendy will try to find someone in the Domestic Policy Council to run this
by, and she will ask Tony Blinken when he comes up for air from a speech
he is crashing on what other suggestions he has. Should we otherwise just
bump this back to Scheduling, or should we ourselves try to find someone
else in the White House to hand this over to? USTR? NEC?
Clinton Presidential Records
Automated Records Management System
[EMAIL] and Tape Restoration Project [Email]
This is not a presidential record. This is used as an administrative
marker by the William J. Clinton Presidential Library Staff.
This marker identifies a responsive email, already made available
within another collection.
Collection: 2019-0151-F
Bucket: Default
Creation Date: 1997-05-07
Subject: 1997-05-07 President Remarks to Citizens of Mexico
Creator: [email protected] Publications-
[email protected][UNKNOWN]
Clinton Presidential Records
Automated Records Management System
[EMAIL] and Tape Restoration Project [Email]
This is not a presidential record. This is used as an administrative
marker by the William J. Clinton Presidential Library Staff.
This marker identifies a responsive email, already made available
within another collection.
Collection: 2012-0661-F
Bucket: Default
Creation Date: 1997-05-07
Subject: 1997-5-7 McCurry Briefing complete
Creator: Margaret M. Suntum SUNTUM_M WHO
ARMS Email System
RECORD TYPE: FEDERAL (NOTES MAIL)
CREATOR: Bruce W. MacDonald ( CN=Bruce W. MacDonald/OU=OSTP/O=EOP [ OSTP ])
CREATION DATE/TIME: 8-MAY-1997 09:39:31:00
SUBJECT: Re: NEC Meeting Summary
TO: Gerald J. Hane ( CN=Gerald J. Hane/OU=OSTP/O=EOP @ EOP [ OSTP ])
READ:UNKNOWN
CC: Susanne Bachtel ( CN=Susanne Bachtel/OU=OSTP/O=EOP @ EOP [ OSTP 1)
READ:UNKNOWN
TEXT:
Gerald,
Firewalls come in several shapes and sizes. In the past, the
firewall between defense and non-defense allowed funding to be transferred
from non-defense to defense, but not the other way around. I take it from
your e-mail that the firewall now is the exact opposite - -- that funds can
be transferred from defense to non-defense, but not the other way around.
Is this correct? If so my, how times have changed!
Bruce
Gerald J. Hane
05/08/97 08:58:26 AM
Record Type: Record
To: Susanne Bachtel/OSTP/EOP
cc: Kerri A. Jones/OSTP/EOP, Deanna M. Behring/OSTP/EOP, Bruce W.
MacDonald/OSTP/EOP, Cathleen A. Campbell/OSTP/EOP
Subject: NEC Meeting Summary
Suzy,
I don't know how quickly you need a summary of the NEC meeting so I have
provided one below. Would you like a formal memo for Dr. Gibbons or will
this be satisfactory?
There were five items on the agenda.
1. Budget
Gene Sperling noted that although the broad guidelines were agreed
to last Friday, important details remain to be negotiated. These include
composition of the tax cuts, details on Medicare, and funding for project
HOPE. There seemed to be satisfaction with the numbers for foreign
operations, environment, and education. It is also expected that fire
walls will be erected between the defense and nondefense accounts to
protect the nondefense accounts (a change from the past.)
2.
Comp Time
A bill is being introduced by Senator Ashcroft, apparently to
allow comp time for working more than 80 hours over two weeks. There is
some desire on his part to introduce this before Mother's Day. This was
a short discussion and no bill details were given.
3.
Fast Track/China MFN
Both are of high concern according to Tarullo. Although MFN
status is supposed to be based on the allowance of emigration, Congress
and the public bring in many other issues with respect to China: human
rights, trade deficit, nuclear activities, treatment of Hong Kong, etc.
The President's submission to allow MFN is due by June 3. A vote is
likely before the August recess, but the prospects look tougher than in
the past. The Christian Coalition and the AFL-CIO are both campaigning
against granting MFN status.
Fast Track authority is caught up in this same environment. USTR
has been actively briefing the Hill. Gephardt has a proposal that would
require labor and environmental issues to be addressed in all agreements.
Not a good approach from the Administration's view. Former President
Carter has offered mediating services.
-
Tarullo also raised problems with the Civil Aviation Negotiations
with Japan. He noted that Japan is not honoring its agreements, raising
new barriers as others are settled. He is recommending a separate meeting
on this issue.
4.
Product Liability
The President has given guidance to renegotiate this issue (he
vetoed a bill last year) in a manner consistent with the reasons stated
for vetoing that bill: he does not want to reverse those positions. A
bill moving through Congress has many of the problems as last year's bill
(e.g., cap on punitive damages, abolition of joint and several liability
for non-economic damages, short time limit, etc). However, there appears
to be more willingness by certain members to find a solution. An
interagency group is working on this issue with Bruce Lindsay also
apparently involved.
Another issue raised was the treatment of Tobacco overseas. The
U.S. is being criticized for promoting a product that it limits
domestically. There is particular concern about treatment of children
overseas and targeted advertising (apparently a couple of years ago a U.S.
Ambassador posed with Joe Camel at a press conference.) Guidance to
embassies and commercial attaches was raised as an important issue.
5.
Securities Litigation Reform.
This was a brief discussion regarding the interface of Federal and
State courts.
Clinton Presidential Records
Automated Records Management System
[EMAIL] and Tape Restoration Project [Email]
This is not a presidential record. This is used as an administrative
marker by the William J. Clinton Presidential Library Staff.
This marker identifies a responsive email, already made available
within another collection.
Collection: 2019-0142-F
Bucket: Default
Creation Date: 1997-05-09
Subject: PBS: News Hour With Jim Lehrer, 5/8/97
Creator: [email protected][email protected]]
UNKNOWN]
ARMS Email System
RECORD TYPE: FEDERAL (NOTES MAIL)
CREATOR: Frances Sharples (CN=Frances Sharples/OU=OSTP/O=EOP [ OSTP 1)
CREATION DATE/TIME:12-MAY-1997 09:11:57.00
SUBJECT: SC Action Vol. II #87
TO: Rosina M. Bierbaum (CN=Rosina M. Bierbaum/OU=OSTP/O=EOP @ EOP [ OSTP 1)
READ:UNKNOWN
TEXT:
GREAT PIECE in this one about the SC's Friday rally and the delivery of
their write-in results to none other than S. Katzen herself!
Forwarded by Frances Sharples/OSTP/EOP on 05/12/97
09:14 AM
owner-sierraclub-action @ LISTS.SIERRACLUB.ORG
05/10/97 04:41:00 PM
Record Type: Record
To: Brian J. Johnson, Frances Sharples
cc:
Subject: SC Action Vol. II #87
SC Action #87
Defending the Environmental Agenda
May 9, 1997
"Democracy today is not possible without a politics that can control
global economic forces, because without such control it won't matter
who people vote for - corporations will rule."
-- Harvard Professor Michael Sandel
Sierra Club Legislative Hotline - 202-675-2394
Sierra Club National Headquarters - 415-977-5500
Sierra Club World Wide Web - http://www.sierraclub.org
White House Comment Line - 202-456-1111
White House Fax Line - 202-456-2461
Clinton's e-mail - [email protected]
Gore's e-mail - [email protected]
White House Address - 1600 Pennsylvania Ave, Washington, DC 20500
US Capitol Switchboard - 202-224-3121
Contents:
FIX NAFTA: RADIO CALL-IN ACTION ALERT
STILL LOOKING FOR A GIFT - HOW ABOUT CLEAN AIR?
SPRAWL HURTS US ALL: A REPORT FROM VIRGINIA GLOBAL
WARMING: A DIFFERENT DIMENSION
FIX NAFTA: RADIO CALL-IN ACTION ALERT
Even though NAFTA has proven harmful to public health and the
environment, Congress could vote this month to give the President
"fast-track" authority to expand NAFTA to South America (and
negotiate other trade deals). But the more noise we make now, the
less likely it is there will be a vote!
Next week, you'll have a chance to tell radio listeners in 200+
cities that Congress should fix NAFTA, not expand it. Sierra Club
book author Joel Simon appears next week, May 12 - 14, on two
nation-wide and one Washington, DC call-in radio shows. In his
book, "Endangered Mexico," Joel writes that NAFTA has worsened
environmental problems that contribute to most of the tensions we
have with Mexico including border pollution, industrial flight,
immigration, and drugs.
TAKE ACTION: Call in to the radio programs listed below and ask Joel
about NAFTA's environmental failures. Take a look at the sample
questions below if you need inspiration or use the facts in them to
write a letter to the editor explaining why we need to fix NAFTA
rather than expand it.
Sample Questions / Comments
* "Joel, I heard that 150 Michigan school children got hepatitis A from
eating Mexican strawberries. Under NAFTA we only inspect 1 percent of
the food that comes across the border. And, we have to accept Mexico's
food inspections in place of our own. I don't understand why Congress
voted for a trade agreement that weakened our food safety laws."
* "The US gets half its winter fruits and vegetables from Mexico.
But the Mexican growers who sell to US food companies often use
pesticides that are banned in the United States and illegal in
Mexico. Worker safety isn't enforced either. As a result, doctors
see a lot of leukemia and pesticide poisoning in farm workers.
Didn't the NAFTA environmental side agreement say that each country
has to have strong environmental and worker safety laws?"
* "Joel, you say in your book that when logging companies cut down
forests in the Sierra Madre, they open up new land that is now used to
grow poppies for making heroin. Didn't Mexico just pass a new law to
attract more foreign logging companies and does this mean more drugs?"
* "Hundreds of US companies like Zenith and GE have moved plants
across the border to Mexico since NAFTA. Pollution is worse but
NAFTA's border clean up plan has provided only about 1 percent of the
promised money. Of course, the border is only the tip of the ice
berg. When US companies can go global, they blackmail us to relax
environmental standards here in America. Hasn't trade policy created
a "race toward the bottom" where corporations win, but everybody else
loses?"
Call in Times/Stations/Phone Numbers:
5/12 2-3 p.m., EST, UBN Radio "Bay Buchanan Show" live interview,
listener call-in, Washington DC, United Broadcasting Network, on 200
stations nationwide, call in # 800.825.5937
5/13 12-1 (may switch to 1-2), EST, WAMU Radio "Derek McGinty Show"
live interview, listener call-in,, Washington, DC, nationwide/NPR,
call in # 202.885.8850
5/14 11-12 WPFW "Dialogue with Dorothy Healy" live interview,
Washington DC only, listener call-in # 202.588.0893
For more information, contact:
Dan Seligman
Sierra Club Responsible Trade Campaign
(202) 675-2387
[email protected]
STILL LOOKING FOR A GIFT - HOW ABOUT CLEAN AIR?
Today, Sierra Club and the US Public Interest Research Group, held a
Mother's Day event across from the White House where children with
asthma, their mothers, politicians, environmentalist and concerned
citizens all expressed the need for the new EPA proposed clean air
standards.
Kyle Damitz, an eight year old severe asthmatic from Chicago,
explained to the assembled crowd how much he likes playing outdoors,
but can't do it as much as he would like due to the pollution in his
area. His mother, Maureen, who participated in a March clean air
debate against Citizens for a Sound Economy, explained the many
restrictions by which Kyle must abide.
Also featured at today's conference was Toby Liebowitz from
Barrington, Rhode Island, a mother of two children who suffer from
asthma. Her youngest son, Gabriel has a severe case which prevents
him from participating in sports because his condition is worsened by
air pollution and he can't control when his attacks will come. But he
loves riding his bicycle outdoors and does that whenever the air is
clean enough. Ms. Liebowitz pleaded that, "..he deserves to breathe
cleaner air every day."
Joan Willey, a mother of five and grandmother of five from Maryland
also spoke on the importance of having stricter clean air standards.
She and her oldest daughter both suffer health effects when the air
is bad, particularly in the summer. They must stay indoors even when
the alert only lists the air as "moderate" or level orange.
Ms. Willey went on to say, "In areas like Baltimore and Annapolis,
it's not healthy for children to be outside on high air pollution
days. Scientists tell us that children aren't little adults when it
comes to their health. Their immune systems are still forming, they
are outside for hours at a time, and they are exposed to more, not
less, pollution per pound of body weight."
In addition, three elected officials - Sen. Joe Lieberman (D-CT);
Louisiana state Rep. Melvin Holden and New Hampshire state Senator
Russman - spoke of the importance of implementing the proposed
standards so that children like Kyle and Gabriel can breathe cleaner
air.
Vicki Rafel, a representative from the National Parent Teacher
Association stressed the need to protect children's health. She
stated, "On behalf of the 6.5 million members of the National PTA, I
urge Congress and our policy makers to adopt the most protective air
quality standards possible to assure a clean and healthy environment
for our nation's children...
Following the event, the thousands of postcards that were collected
from Earth Day events around the country were delivered to White
House official Sally Katzen.
Sierra Club Legislative Director, Debbie Sease, presented Ms. Katzen
with three "Clean Air for Our Kids" t-shirts - for herself, the
President and Vice President. Kyle Damitz asked Ms. Katzen if it
would be possible if he could take a tour of the White House. Not
only did she arrange a tour, but while on the tour they bumped into
Mr. Gore himself and were able to present the Sierra Club t-shirt to
him personally.
Congratulations to everyone who made this very successful event
happen.
SPRAWL HURTS US ALL: A REPORT FROM VIRGINIA
An AP news service report earlier this week highlighted the Club's
efforts to curb the problem of urban sprawl both in the northern
Virginia suburbs of Washington, DC and on the Virginia coast. The
article, which ran in the Fairfax Journal, concentrated on the Club's
efforts to stop the King William reservoir proposal that, in addition
to damaging wetlands and the Mattaponi river, would also contribute to
the potential for sprawl in the Virginia cities of Newport News,
Hampton, Williamsburg and the counties of James City, York, and New
Kent.
Sierra Club Regional Representative, Glen Besa, was quoted saying,
"It was clear that from Los Angeles to Atlanta, and from Minneapolis
to Tampa, people were concerned with the uncontrolled growth that was
just chewing up our countryside, increasing our air pollution and
causing congestion."
The article continues, "Communities often believe new development
will reduce tax rates only to find that the costs of new roads, sewer
and water lines, schools and other services outweigh the tax
benefits, he [Glen Besa] said."
GLOBAL WARMING: A DIFFERENT DIMENSION
As Global Warming Worsens, Our Planet Pays the Price
We live on a new planet, according to New York Times op-ed writer
Bill McKibben. In the May 3rd edition of the Times he detailed how
global warming pollution from automobiles, factories, power plants,
and deforestation is rapidly altering the world we live in.
The evidence is overwhelming, concludes McKibben. The number of
"extreme precipitation events" (rainfall of more than two inches in
24 hours) has jumped 20 percent. Spring comes a full week earlier in
the Northern Hemisphere. Vegetation has increased 10 percent above
the 45th parallel. The northern tundra may have warmed enough that
in some years, it adds carbon to the atmosphere instead of soaking it
up.
McKibben states "Understand this about these changes: They are
enormous. They do not represent small shifts at the margin, the slow
evolution that has always occurred on earth. Spring a week earlier;
20 percent more storms, 10 percent more vegetation since 1980. These
studies are like suddenly discovering that most Americans are 7 feet
tall. If we were looking through a telescope and seeing the same
things happen on some other planet, we would find it bizarre
and fascinating. If someone's watching us, they're doubtlessly
bewildered."
According to McKibben, politician's efforts have been feeble at best,
and even most environmentalists have not yet realized the dangers
global warming poses. Current efforts aimed at reducing global
warming are far too weak to solve the problem.
"Now negotiators are trying for an agreement with more teeth -- but
the deadlines are far away and the targets modest. Instead of locking
ourselves into a document that physics, biology and chemistry are
rendering instantly outdated, it's probably better to convene the
world's leaders on the crumbling edge of the West Antarctic Ice
Sheet. Maybe then we'd get quick action."
"Eight years ago, James Hansen, the NASA scientist who has used his
computer model of the climate to make the most prescient forecasts
about global warming, predicted that by the late 1990's the effects
of global warming would become apparent." McKibben states. "For
eight years, I've believed this was true, and still this spring's
flood of new data shocks and scares me. All those things that people
said would happen if we didn't clean up our act? They're happening.
This is a new planet, not the earth we were born on."
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RECORD TYPE: FEDERAL (NOTES MAIL)
CREATOR: [email protected] ([email protected] [ UNKNOWN ])
CREATION DATE/TIME:13-MAY-1997 14:14:48.00
SUBJECT: CNN: Capital Gang Sunday, 5/11/97
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Message Creation Date was at 13-MAY-1997 14:03:00
Capital Gang Sunday:
Sealing The Balanced Budget Agreement
Aired May 11, 1997 - 7:00 p.m. ET
ANNOUNCER: Live from Washington, CAPITAL GANG
SUNDAY.
JIM GLASSMAN, "WASHINGTON POST" (on-camera):
Welcome to CAPITAL GANG SUNDAY. I'm Jim Glassman with Ruth Conniff of "The
Progressive," syndicated columnist Mona Charen, Jeff Birnbaum of "Fortune"
Magazine and Howard
Fineman
of "Newsweek."
Even though a truce has been declared and both sides have
agreed
to agree on a budget deal, there is still hand-to-hand
combat over
the details -- take education, for instance. The Clinton
administration
claims Republican leaders agree that $35 will be set aside
of tuition
tax credits and a $10,000 tax deduction. House Ways and Means Chairman
Bill Archer insists that he is not bound by any
number.
The White House is positive they had a commitment.
(BEGIN VIDEO CLIP)
MIKE McCURRY, WHITE HOUSE PRESS SECRETARY
(on-camera): A deal's a deal and we're gonna make sure that
those
things that were in the agreement, the framework agreement
that
was put together by the White House and by congressional negotiators,
holds up in the end of the day.
(END VIDEO CLIP)
GLASSMAN: House Speaker Newt Gingrich is taking it all in stride. He hopes
to get a final budget agreement by the 4th
of July.
(BEGIN VIDEO CLIP)
NEWT GINGRICH (R) HOUSE SPEAKER (on-camera): When
you take a two-page agreement and you turn it into a
2,500-page
bill, there is inevitably a lot of argument. And I think
people should
just recognize that that's the normal legislative process,
nothing
unusual.
(END VIDEO CLIP)
GLASSMAN: So, Jeff, what happened to this deal? I thought everything was
signed, seal, delivered. It's all done.
JEFFREY BIRNBAUM, "FORTUNE" MAGAZINE (on-camera):
Well, signed and sealed. I think, really, it's all over but the shouting.
And there's going to be a lot of shouting, mind you, and a
lot of
elbows trying to push the deal around. And these details are important.
For example, they have about $90 billion worth of
tax
cuts promised than they have money to spend on them. That's
a bit
of a problem. But they're lucky. They have a set of
circumstances
that would get to balance in the year 2002 almost by itself,
basically,
and that's too much to pass up. There's going to be a deal.
It won't
happen this summer. It won't be finished. But it will happen eventually.
It's -- I think it's all but done.
GLASSMAN: You say it's all but done because of the economics?
BIRNBAUM: Right.
GLASSMAN: Things are going well and it's easier to get to a balanced
budget.
BIRNBAUM: Revenue is basically pouring in.
GLASSMAN: But the essential question, Howard, is this a
matter
of a few little details that have to be straightened out?
Or, is it big
things? I mean, Clinton really wants this $35 billion in tax
subsidies
for education. And the chairman of the Ways and Means Committee said, "Oh,
we didn't make a deal on that."
HOWARD FINEMAN, "NEWSWEEK" (on-camera): Yeah, and
the chairman of the Ways and Means Committee wasn't in the
room
when they were making the deal. Well, he says not. And Bill Archer, you
know, he's sort of like the joker who says wait
'til they
get a load of me. Well, they're going to get a load of him,
and he
doesn't like what he's seen, so far, and as Jeff said, there
are many
more taxes promised than there is room for and there are philosophical
disagreements on things like capitol gains
tax, on Bill
Clinton's big education tax cuts. Archer says he doesn't
have to be
bound by the deal.
RUTH CONNIFF, "THE PROGRESSIVE" (on-camera): Not
enough of a philosophical disagreement, though, if you ask
me. I
mean, Clinton has basically reneged on the small amount of
money
he was going to put towards rebuilding the schools, the $5 billion.
He's got a tax credit that goes to people who itemize their
taxes,
which means mostly the vast majority of people who make more than $30,000
a year. I mean, he rolled over on this deal. He
said,
"We're going to have a balanced budget. We're going to have
big fat
tax cuts at the same time. The poor are going to pay for it,
and the
wealthy are going to get a free ride."
GLASSMAN: Mona?
MONA CHAREN, SYNDICATED COLUMNIST (on-camera):
Ahh, if it were only true.
GLASSMAN: Well, you know, it is true that he did back down on this $5
billion to fix school roofs in various communities
around the
country. I don't know what that --.
CHAREN: Right. What an absurd is there a more absurd idea than that the
federal government should be in charge of
fixing school
buildings that are breaking down around the country? I mean,
you
know, in a lot of these jurisdictions where there are
breaking down
buildings like New York City and Washington, D.C., you have
the
highest per pupil spending of anyplace in the country. The
reason
these buildings are falling apart is that local officials
have made bad
decisions about how to spend their money. It's not a federal role.
GLASSMAN: Let me ask you quickly because Ruth some people would her
being somewhat on the left, I guess -- but
you,
maybe on the right. Do you like this -- she doesn't like
this deal. Do
you like this deal?
CHAREN: No. I don't like it. But I don't think it's the end
of the
world either. There will be another election in 1998 and
another one
in the year 2000. I think the conservatives who are pulling
out their
hair over this are overreacting a little bit.
CONNIFF: It ain't exactly the Great Society. I mean, this is
a deal
that says we're going to have capitol gains tax cuts,
people, you
know, here's a crime. People have more than $600,000 to
leave to
their children, should not have to pay taxes after that
first $600,000
they leave. I mean --.
GLASSMAN: And a lot by, the way -- a lot of Democrats are
in
favor of increasing the exemption on the inheritance tax.
CONNIFF: That's right.
GLASSMAN: Well, it's a different kind of country.
CHAREN: But on the other side, look, this budget increases
funding
for Head Start, which even the founder of the program says
should
not be increased because most of the programs don't work and
we
don't know how to make them work, increases Medicare, Medicaid, subsidies
for SSI, things that we, that
Republicans ought
to have made a principle --
GLASSMAN: SSI?
CHAREN: -- Supplemental Security Income.
GLASSMAN: OK, let's get back to the problem, let's -- forget
the
substance -- let's get back to the politics. So, you're very
sanguine
about this thing actually going through?
BIRNBAUM: Oh yeah. I don't think there's any question.
GLASSMAN: So you just think all this is just a lot of talk.
BIRNBAUM: No, the details are very important, and there are
--
there's going to be a lot of fights along the way. I don't
believe,
though, that the fundamentals of this deal are going to fall apart.
There are disagreements on the left and right, but most of
that, in
Congress at least, is posturing to try to pull the deal back
to where it
is now.
GLASSMAN: Howard?
FINEMAN: Well, in the end, I think Jeff's right, not only
because of
the economy, because the Republicans still remember last
year and
in the end, they're going to want a deal just so they don't
get nailed
again for being obstructionist.
CHAREN: They're fearful, that's the problem.
GLASSMAN: Of course, the Republicans also have this really
neat
idea, the Republicans have this continuing resolution which
says that
if there's no budget deal, then you revert, it originally
was going to
be 98 percent of the last year's budget, now it's 100
percent. And
it's a way to sort of keep them from taking the blame.
CHAREN: Right. That would have been great, if they had the
sense
to do that.
GLASSMAN: Well, it's not clear whether that is going to go through or not.
It hasn't really been shot down yet. Yes?
CONNIFF: If the Republicans are fearful, I don't know what
you
would say about Bill Clinton. I mean, his idea that we have
not only
a balanced budget, but we're balancing our values. What a
nifty
idea. You know, you give up something you deeply believe in,
I give
up something I deeply believe in.
GLASSMAN: So, what do you deeply believe in that's not in
this
budget, that you would think a real Democratic president
would put
in?
CONNIFF: Well, I think this is an opportunity. I mean, we
have this
windfall, right? Gee, all of a sudden, $225 billion.
GLASSMAN: Windfall meaning taxes that people are going to pay.
CONNIFF: Well, we have more money than we thought we had.
CHAREN: Why don't we get to keep it?
CONNIFF: Mona, I suppose, would be for just sort of
allocating it
to each individual.
GLASSMAN: No, it's ours to start with.
CHAREN: I earn it. I earned it.
FINEMAN: Jim would be for a $1,0 per person.
GLASSMAN: Right.
CONNIFF: What I think Clinton might have done, which is,
since
he's no longer running for election, which is hard to tell,
I think that
he could actually do what he said he would do and invest it
in
education in this country for starters. I mean, we talk, we
give all this
lip service to this idea. And I don't agree with Mona that
schools
falling apart is just some bad management problem. I mean
there are
some really sorry, sorry situations.
GLASSMAN: She thinks it's a local problem. But we have to
wrap
it up. And when we come back, President Clinton deals with
the
wars in Central America ten years later.
(COMMERCIAL BREAK)
JIM GLASSMAN: Welcome back. President Clinton headed south of the border
last week. During a stop in Costa Rica,
leftover Cold
War issues heated up. During a Central American summit, the president
reassured leaders that the region was still
important to the
U.S., even though the battlefields of the eighties are quiet now.
Central Americans are specifically worried about a new
immigration
law that could prompt mass deportations of refugees who fled
to the
U.S. to avoid the wars. Mr. Clinton pledged to delay
enforcement
and ask for special consideration from Congress.
(BEGIN VIDEO CLIP)
PRESIDENT BILL CLINTON (on-camera): In these nations where democracy has
prevailed and we want to work with them
to
succeed, it seems to me we ought to be sensitive to the
disruptions
that were caused during those tough years, that we were
involved in
as a nation.
(END VIDEO CLIP)
GLASSMAN: So Ruth, does President Clinton really feel the Central
American's pain?
RUTH CONNIFF: That's a sarcastic question. But I thought it
was
really decent of Clinton to acknowledge that the United
States
played a shameful role in helping to fund and train the
torturers in
Latin America who killed tens of thousands of people during
the
death squad era, especially in Guatemala and El Salvador.
So, it
was a good --.
JEFFREY BIRNBAUM: Get a commercial in.
CONNIFF: It was a good --
GLASSMAN: You may not have noticed, but all of Central America, all of
Latin America, now has freely elected
democratic
governments for the first time in history.
CONNIFF: There are some, yeah, there's a lot of progress in
Latin
America, although there are some pretty corrupt regimes. For example, the
Mexican government, where Clinton spent a lot
of time
hanging out recently. But, yeah, I think that the wars of
the eighties
are over and for the most part, things are better. But we've
got the
fallout now. We've got all of these people who fled from some horrific
situations that we did help create there. And the
question is
what do we do for them.
GLASSMAN: So, what do we do for them? I mean, this deportation issue seems
to be fudged.
JEFFREY BIRNBAUM: Oh definitely. The Central American leaders wanted
amnesty for, I think there are about 300,000
of their
people in this country now. And Clinton told them in a very charming way,
"no." But he did offer them an olive branch.
He did
say that they could -- that the deportations would be put
off until
October and that he would jawbone Congress and try to loosen
it
up a little bit and also promised there would be no mass deportations,
case-by-case basis. So, he did charm the
Central
Americans. But at some point, I think this charm offensive
got a little
offensive.
HOWARD FINEMAN: He was even charming enough to admit that we were in part
responsible for the drug problem that
they have
to deal with there.
GLASSMAN: Right. Good point. I mean --,
FINEMAN: We consume more than half the world's drugs.
GLASSMAN: He said 5 percent of the population, half the
world's
drugs. The next logical stage would be why do we go through
this
stupid certification process every year with Mexico, when
it's really
our fault?
FINEMAN: Well, it's partly our fault though. But he didn't
hit hard
enough on the rest of the story. I think Bill Clinton's
charm has its
limitations and dealing with the drug issue in Latin America
is one of
them. We now find, after he's safely out of Mexico and
relaxing in
Barbados, that the Justice Department has been supervising a massive
investigation of money laundering and drug traffickin
g by
top Mexican officials. And this is very serious business. I
would like
to know if Bill Clinton raised that with Mexican leaders and
if so,
how and if so, why we weren't told about it.
GLASSMAN: Do you agree -- you know, President Clinton actually said -- he
didn't quite say that we caused all this
trouble in
Central America, as Ruth seems to believe, in the eighties.
But he
really -- it was almost kind of an apology.
MONA CHAREN: It was. It was too apologetic in tone, though I agree with
Howard. It's right to say that we are responsible
for the
drug problem, because it's our market. But when it comes to Central --
when it comes to what happened in Central America during the 1980s, it is
a cruel insult to suggest that the
United States
caused the problem. In point of fact, no thanks to Ruth and
her
friends, there was a very aggressive communist insurgency
that was
going on, funded by Cuba and the USSR during the 1980s.
GLASSMAN: By the way, Ruth did not personally have anything
to
do with it.
CHAREN: Given the opportunity, she might have. But, we but we thwarted
it. If we had not, we probably would have seen something along the lines
of the boat people who came here
from
Cuba and the and Southeast Asia. As it is, all of those
countries
are democratic now and we deserve credit for our role in
Latin
America.
GLASSMAN: OK. You get to respond to that.
CONNIFF: What about the El Masotae (ph) massacre? I mean, the fact that
the CIA was actually directly involved in killing
all those
people, doesn't that bother you a little bit?
CHAREN: Do you want to talk about massacres? I mean, do you want to
compare the records of free nations versus communist countries? Let's not
get into that now. GLASSMAN: OK, no, we aren't going to talk about
bananas. The other thing that
went on was
that another thorny issue is whether to extend NAFTA,
which is
our free trade agreement with, now with just Mexico and Canada.
Should it be extended to Central America? What did the
president
say there?
FINEMAN: Well, he wants to extend it.
GLASSMAN: Yeah, he wants to, but is he going to do anything about it?
FINEMAN: I don't know if he is going to do anything about it, because
there are lots of problems involved in that also.
BIRNBAUM: No. In fact, he indicated, he downplayed that. He papered over
that along with a lot of other things, like
drugs,
because it doesn't look like he's going to be able to get
the so called
fast track authority, which would allow trade, free trade to
whisk
through the Congress. I don't think it's going to happen. He
didn't
promise it. So, he sort of sidestepped it.
GLASSMAN: Yes, go ahead.
CHAREN: Let me make a point about the immigrants from Central America.
GLASSMAN: Yes.
CHAREN: They are incredibly hardworking people. This is not
an
easy issue, because they came here under a provision of the
law that
said if your home country is engaged in turmoil, you can
come in
temporarily until things calm down at home. Then we changed
the
law. And so, it really is kind of unfair to suddenly ship
all of these
300,000 people back, who are earning a good living here and they're
sending part of that money back home. It seems
unfair.
GLASSMAN: I completely agree with you. And when we come back, Mother's Day
in Washington, what politicians are
trying to do
with your kids.
(COMMERCIAL BREAK)
JIM GLASSMAN: Welcome back. It may be Mother's Day, but in Washington,
it's kids who are getting all the attention. The
House of
Representatives passed a tough juvenile crime bill, giving
states
incentive to try juveniles who commit violent crimes as adults.
President Clinton opposes the bill as he explained in his
weekly
radio address.
(BEGIN VIDEO CLIP)
PRESIDENT CLINTON: Perhaps most troubling, the House bill rejects my call
to cut off young people's access to guns,
now the
third leading cause of death for young people between the
ages of
13 and 24. We must begin with a simple precaution of child
safety
locks. REP. BOB LIVINGSTON (R-LA) (on-camera): I think the president's
just looking for a reason to oppose that bill.
The taking
of a life has to be dealt with and these kids know what
they're
doing, and I don't have any problem putting them in jail
just like
everybody else.
(END VIDEO CLIP)
GLASSMAN: What kids watch on TV has caught the eye of House Speaker Newt
Gingrich. He is calling on TV networks to make the first hour of prime
time, from eight to nine, more family-friendly.
(BEGIN VIDEO CLIP)
NEWT GINGRICH: We ought to have programming that is more appropriate for
six, to nine, to ten, or 11-year-olds to
watch. And
it's an easy test. Are you comfortable watching a show with
your
child sitting next to you?
(END VIDEO CLIP)
GLASSMAN: Mona, happy Mother's Day. You're the only mother on the show.
MONA CHAREN: Thank you.
GLASSMAN: And so, do you think that Congress should get involved in this
family TV issue? Is it a role for
government?
CHAREN: Well, they should jawbone, yes. They should shame the networks in
any way that they can into doing the right
thing. I don't
think they should pass a law on the subject. But I do think
that they
should make it clear that as a society, we believe that the
cultural
environment can be polluted just as the physical environment can be.
GLASSMAN: Do you watch TV between eight and nine with your kids?
CHAREN: No.
GLASSMAN: Other than CNN?
CHAREN: No. They don't stay up that late.
GLASSMAN: Uh-oh. Well, that's one way around it. So, is this
a
hot issue? I mean, it seems to me that when you get in
trouble, you
sort of do what Bob Dole did and attack the TV networks. I
mean,
not that they're not worth attacking.
JEFFREY BIRNBAUM: No, and if you do -- I do occasionally watch TV at that
hour and a little bit later.
GLASSMAN: What's on?
BIRNBAUM: A lot of stuff that I am a little uncomfortable
having
my kids watch, for sure. But I agree with Mona that it's not
the
place of the Congress to legislate there. I think, if they
want to
legislate, maybe they should force the TV networks to have
some
free time for politicians and help.
GLASSMAN: Oh, between eight and nine? That would put the kids to sleep,
right?
HOWARD FINEMAN: I don't think that's family-friendly.
GLASSMAN: OK, let's talk about juvenile
CHAREN: It would put the kids to sleep early.
GLASSMAN: Well, that's not a bad idea. But let's move back to juvenile
crime. That's what we were talking about in the
beginning.
There's this juvenile crime bill which a lot of the
Democrats really
hate and, but President Clinton is attacking it because it
doesn't have
anything about guns in it.
FINEMAN: He wants the safety locks on the guns. I think this
is
one of those issues where people don't want to talk about
what's
really going on here. This is a race issue to a large
extent. I mean, I
think a lot of liberals and a lot of African-Americans and
others
think that if you start seeking adult punishment for 13 and
14 and
15-year-olds, it's going to weigh disproportionately on
people in
minority communities and that's the issue that Bill Clinton
doesn't
want to talk about, but he should be forced to address.
GLASSMAN: But, of course, the other problem is that many,
many
teenagers commit very terrible crimes. So the question is,
do you
treat them through the juvenile justice system, where, in
many cases,
in fact I think in all cases, they don't even get anything
on their
record. Or do you treat them as adults if they've committed
an adult
crime? What do you think, Ruth?
RUTH CONNIFF: Look, nobody believes that the adult prison system reforms
criminals, right? Nobody believes that it
corrects
their behavior, that they come out better people. Up until
very
recently, we have sustained a commitment to the idea that
there is
such a thing as reform for juveniles. And so what we're
really saying
with this, we want you to throw them away. I mean, these kids aren't going
to go away. They're going to be there in the
prison
system. They're going to be -- you know -- if this bill
passes, they
will be housed with adult criminals, and, you know, really
it's a bill
about giving up on kids.
CHAREN: There's nothing good you can do when you've created a 13-year-old
killer. And the only way - you can't do
anything for
that kid, frankly. You can't reform him. The only thing you
can do is
lock him up until he's too old to be interested in
committing crimes,
like when's 50. But, you do have to do something about, what
John
Delulio (ph) has called the criminogenic environment in
which these
kids are being raised. And the answer to that is, at least
in the
beginning, taking kids away from abusive parents much more aggressively
than we currently do.
GLASSMAN: But you're agreeing with what Ruth is saying. So you're saying
just sort of lock them up and send them away.
CHAREN: No, she wants to reform them. I don't even think you can.
GLASSMAN: Well, what should you do with a 13-year-old murderer or a
14-year-old, or a 15-year-old. Forget the 13,
that
makes it too low.
CONNIFF: I've met some 13 and 15-year-old murderers,
actually,
and I don't agree with you that they're hopeless.
GLASSMAN: Send them to reform school and keep it off their record, the
fact they killed somebody?
CONNIFF: It's really hard to do much at that age. I agree with that.
But I have actually met some kids who've been through
programs
that have had a profound effect on their lives. And I think
it is sick to
say that we should simply give up. But what's really hideous
about
this is, this is coming at a time when we are not making a commitment to
fund programs that could help kids at an early
age.
GLASSMAN: OK. Unfortunately, we're going to have to stop. And when we come
back, the Hall of Fame and the Hall of
Shame.
Who gets inducted and why.
(COMMERCIAL BREAK)
JIM GLASSMAN: It's time for the Hall of Fame and the Hall of
Shame. George W. Bush, governor of Texas, son of the
ex-president and a possible GOP presidential candidate in
the year
2000 himself, had a great idea, hire private companies like
IBM to
run a one-stop shopping center to service people on welfare.
Texas
could cut bureaucrats, save money, give better service. But
the
Clinton administration last week said, no way. Proof again
that
Democrats allow us to reinvent government, not at all,
unless we've
got that union seal of approval. Ruth.
RUTH CONNIFF: Thanks. Newt Gingrich wants to launch his own inquisition.
He would start by trying to make religious
converts out
of drug dealers. The government would step up surveillance of suspected
dealers. Those who get caught would go to a
religion
rehabilitation program. Forget separation of church and
state and
woe betide those who get caught a second time. To them
Gingrich
said, we're going to kill you. Now, that's old-fashioned persuasion.
Torquemado would be proud. Jeff.
JEFFREY BIRNBAUM: Republicans have been gleeful over the foreign campaign
contributions the Democrats have collected illegally and been forced to
return. But last week, roles
were
reversed and the Republicans said they would give back
$122,000
to Young Brothers USA, which really turned out to be Young Brothers Hong
Kong. Democrats still have the bigger problem,
of
course, but the GOP foreign connection isn't over. Look for
more
revelations soon. In the meantime, shame on them both. Howard.
HOWARD FINEMAN: This is an historic day. Just a few hours ago, a bunch of
diodes and silicon named Deep Blue defeated
the
world's greatest chest champion, Gary Kasparov, in a
five-game
match. But I'm not one of those who minds that machines are becoming
smarter than people. I say more power to them. Now, Deep Blue, a few new
tasks. Make Dennis Rodman shy. Get Ellen DeGeneres to shut up. And no more
O.J. books, ever. Mona.
MONA CHAREN: Most of the major notables of San Francisco were there,
including Mayor Willie Brown, the district
attorney, and
the president of the board of supervisors. Where? A party for political
consultant Jack Davis. The entertainment featured
male and
female strippers, topless dancers and inflatable rubber
penises. The
sadomachochistic finale featured a dominatrix with a whiskey
bottle
and a razor blade cutting a pentogram into the back of a so
called
satanic priest. There's more, but I can't mention it in the family hour.
Quote, "Everyone enjoys total access to my administration," explained
Mayor Brown. It's a brave new world.
GLASSMAN: And you were just on the West Coast, last week?
FINEMAN: I was not asked any questions.
GLASSMAN: You were not at that party. I knew you were not at that party.
CHAREN: Listen, I don't mind that Deep Blue won, but I'll be impressed
when a computer can make a human being.
GLASSMAN: And OK, fine, on Mother's Day, it's quite appropriate. And hello
to Jim Warren who's out in Idaho
watching
the show.
And that's it for CAPITAL GANG SUNDAY. Don't forget to join us again next
week.
Clinton Presidential Records
Automated Records Management System
[EMAIL] and Tape Restoration Project [Email]
This is not a presidential record. This is used as an administrative
marker by the William J. Clinton Presidential Library Staff.
This marker identifies a responsive email, already made available
within another collection.
Collection: 2017-1073-F
Bucket: Default
Creation Date: 1997-06-02
Subject: 1997-6-2 McCurry Briefing
Creator: SUNTUM_M@A1@CD
ARMS Email System
RECORD TYPE: FEDERAL (NOTES MAIL)
CREATOR: [email protected] ([email protected] [ UNKNOWN ])
CREATION DATE/TIME: 4-JUN-1997 20:01:56.00
SUBJECT: PULSE Mid-Week Update for June 5, 1997
TO: [email protected] ( [email protected] [ UNKNOWN ])
READ:UNKNOWN
TEXT:
** EESI Publishing **
** Environment and Energy MID-WEEK UPDATE **
** June 5, 1997 **
The Most Effective Way to Track CONGRESS
Published every Thursday morning, the
Environment and Energy MID-WEEK PULSE
provides timely, objective and comprehensive
coverage of late-breaking Congressional
action on environmental, energy and natural
resource issues.
Questions or Comments? Contact Mike Medd by
phone at 1-888-884-EESI (3374) or (202)628-6500
locally, by fax at(202) 628-1825, or by e-mail
at [email protected].
Visit us on the World Wide Web
www.eesi.org
Appropriations
No compromise in sight on emergency spending bill
Senate leaders yesterday (Wednesday) gave every indication that
the FY '97 emergency spending bill may not be signed into law for
weeks, even as a delegation of civic leaders from the
flood-ravaged Northern Plains warned of the narrow window of
reconstruction opportunity there.
Senate Minority Leader Tom Daschle (D-S.D.) said at a morning
press conference that he hoped for a breakthrough sometime this
week but added, "I don't know when that will be."
"My expectation is this bill is going to go through loaded and
it's going to be vetoed" and will be sent right back for further
congressional work, Daschle said. "We seem to be on that track
right now."
Senate Majority Leader Trent Lott (R-Miss.) told reporters later
in the day that he felt no inclination to strip the bill of
nettlesome provisions. House-Senate conferees at press time were
working to complete a conference report on the supplemental.
Lawmakers are divided mostly over inclusion of continuing
resolution language that guarantees continued federal government
operation if FY '98 appropriations bills are not passed in time.
Major differences also exist over language regarding census
procedures and somewhat lesser ones over public lands
rights-of-way and the Endangered Species Act.
Daschle went on to threaten a filibuster, saying he would keep
the Senate in session all night if the House-Senate conference
committee fails to finish up today.
" ..We're not going to be enthusiastic about doing anything else
until this is resolved," he said. "Nothing should have a higher
priority."
Lott maintained that relief money is "in the pipeline," disputing
claims that relief agencies are out of money and incapable of
helping disaster victims. "I believe the record is very clear
that [the money] is getting there," he said. "The only way
disaster money will stop is if there is a government shutdown."
-- Tim Breen
Budget
Senate delays, House rushes budget resolution vote
Senate Majority Leader Trent Lott (R-Miss) said yesterday
(Wednesday) the final budget resolution would not be voted on in
his chamber until Tuesday, delaying again the process that must
put 13 appropriations bills in place by Oct. 1.
At press time, a House-Senate conference was putting the final
touches on the deal that charts a course to a balanced budget by
2002 in addition to setting FY '98 spending ceilings. The House
and Senate approved their respective versions about two weeks ago
but Democrats, angered over the stalled emergency spending bill,
have not allowed procedural shortcuts that might have obviated
the need for a full-fledged conference.
A spokesman for House Budget Committee ranking member John Spratt
(D-S.C.), said the House still plans to go forward with a floor
vote on the conference bill tomorrow morning. Lawmakers were
expected to take the legislation before the Rules Committee early
this evening, he said. Tim Breen
Energy Policy
House Commerce raises spending caps set by Science panel
The House Commerce Committee served another blow to the Science
Committee yesterday by approving an energy research authorization
bill, H.R. 1277, which raises the spending caps set by the
science panel for FY '98 and FY '99 for certain research
programs.
On May 22, the House Commerce Energy and Power Subcommittee
showed its clout, ignoring H.R. 1277 as marked up by the Science
Committee previously, and in its place approving a substitute
presented by subcommittee Chairman Dan Schaefer (R-Colo.). H.R.
1277, voted out by the subcommittee, strips the funding for
environmental restoration and waste management activities on the
ground that the Science Committee has no jurisdiction over these
programs.
At the markup of the legislation by the full committee yesterday,
Rep. Michael Crapo (R-Idaho) proposed an amendment, which was
adopted by voice vote, increasing the funding limit for the
Department of Energy's field operations and the
electrometallurgical research and development programs.
Crapo recommended spending caps for FY '98 and FY '99 at $100
million and $95 million for field operations as compared to some
$93 million and $88 million approved by the science panel.
For nuclear energy research programs Crapo suggested $164 million
for FY '98 and $146 million for FY '99 in lieu of the Science
Committee limit of $152 million and $134 million.
Crapo's amendment restores the field operations account back to
the administration's request while it provides the necessary
funding for the electrometallurigical research and development
project.
The Commerce Committee approval has cleared the way for the bill
to move to the floor, but the question is whether the legislation
will see floor action. With two versions existing, the Rules
Committee would have to decide on which version should be brought
to the floor.
Science Committee Chairman James Sensenbrenner (R-Wis.) has said
that he hopes to resolve the differences with the Commerce
Committee.
The Science Committee version of H.R. 1277, introduced by Rep.
Ken Calvert (R-Calif.), was moved to the Rules Committee after it
was voted out on April 16, but at the last minute the Commerce
Committee claimed jurisdiction over some of the energy research
programs. The Science Committee then sequentially referred the
bill to the Commerce Committee, which had until June 6 to act on
it.
In the fight over jurisdiction the controversial contents of the
bill were sidelined. Energy efficiency and renewable industries
had complained that their technology programs suffered cuts from
the Science Committee.
The tug-of-war between the two committees has delayed the
possibility of floor action for an R&D authorization bill. If
enacted, the legislation might have some impact on appropriators,
sources say. However, the Appropriations Committee has by now
begun initiating the appropriations process and the tussle
between the two committees has likely diminished the
authorization bill's relevance, observers note. -- Manimoli
Dinesh
Air Pollution
Chafee, Breaux seeking support for clean air letter to Clinton
Senate Environment and Public Works Committee Chairman John
Chafee (R-R.I.) and Sen. John Breaux (D-La.) on Wednesday
afternoon were still in search of signatures for a letter that is
to be sent to President Clinton as soon as possible stating their
opposition to a proposed rule by the Environmental Protection
Agency to tighten emissions standards for ozone and particulate
matter, said congressional sources. The letter does indicate,
though, their apparent willingness to work toward a compromise,
according to the sources.
Chafee and Breaux lend their support in the letter to EPA's plan
to measure an ozone standard over an eight-hour period rather
than the present one-hour period, but the senators do not believe
there is enough scientific evidence to back the proposal's
numerical ozone standard of .08 parts per million at this time,
the sources said. The current ozone standard is .12 parts per
million.
Chafee and Breaux also said they do not believe there is enough
scientific evidence to back EPA's plan for a new fine particulate
matter standard of 2.5 microns or smaller in concentrations of 15
micrograms per cubic meter annually, the sources said. The
senators have said they would like for EPA to address particulate
matter at a later time when more scientific studies on the
pollutant are available.
Meanwhile, Reps. Dennis Kucinich (D-Ohio), Patrick Kennedy
(D-R.I.) and House Government Reform and Oversight Committee
ranking member Henry Waxman (D-Calif.) are among 43 House
signatories to a letter sent Wednesday to Clinton supporting the
EPA proposal. "Although some uncertainties remain," the letter
said, "EPA has set forth an articulate rationale based on the
evidence for moving forward to reduce the risks to our health and
the health of our children." -- Neil Franz
Wildlife
House passes compromise wildlife management bill
With near unanimous approval, the House on Tuesday approved 407-1
a bill setting new management requirements for the nation's 509
wildlife refuges.
The widespread support for H.R. 1420, The National Wildlife
Refuge System Improvement Act, derives from negotiations held
earlier this spring to craft consensus legislation. Included in
the negotiations were Resources Committee Chairman Don Young
(R-Alaska), who originally introduced the legislation; Interior
Secretary Bruce Babbitt; and Rep. George Miller (D-Calif.),
ranking minority member of the Resources Committee.
The original legislation, introduced this winter as H.R. 511, was
extremely controversial and faced a veto threat from the Clinton
administration and faced loads of criticisms from several
Democratic congressmen and wildlife groups.
These opponents of H.R. 511 said it placed recreational sports,
such as hunting and fishing, with too much priority over wildlife
conservation programs in the nations' 92 million acres of federal
refuge lands that were established to protect and conserve
wildlife.
But those opponents of H.R. 511 say the changes made in H.R. 1420
reaffirm the conservation purposes of refuges and put
recreational activities in balance with conservation concerns.
Under H.R. 1420, conservation is elevated to the primary purpose
of the nation's 509 wildlife refuges and the bill outlines
management guidelines for the refuges. Also, the bill requires
that recreational uses of refuges be "compatible" with the
refuge. -- Colleen Schu
Utilities
Senate Banking to mark up PUHCA bill
The Senate Banking, Housing and Urban Affairs Committee will mark
up a bill (S. 621) today that will replace the depression-era
Public Utility Holding Company Act of 1935.
S. 621, sponsored by Banking Committee Chairman Alphonse D'Amato
(R-N.Y.), repeals PUHCA of 1935 and puts in its place the Public
Utility Holding Company Act of 1997, which has broad bipartisan
support.
PUHCA of 1935, which was tailored to suit the depression era, is
considered restrictive of the 15 registered electric and gas
utility holding companies. S. 621, among other things, provides
the Federal Energy Regulatory Commission (FERC) access to books
and records of holding companies and their subsidiaries.
Changes to the bill are expected during the markup. At a hearing
on the bill D'Amato expressed his willingness to revise the bill
to make improvements.
Some witnesses sought a longer transition period before repealing
PUHCA since a few state legislatures only meet biannually. A few
senators also have voiced concern that S. 621 might not
adequately protect consumers.
Senate Energy and Natural Resources Committee Chairman Frank
Murkowski (R-Alaska), who is a co-sponsor of the bill, has
endorsed the passage of the bill.
Murkowski, who is steering the utility deregulation debate in the
Senate, supports stand-alone bills that would remove impediments
to retail competition in the electricity industry. A similar
bill, S. 1317, was approved by the Banking Committee in the last
Congress, but failed to move beyond that. -- Manimoli Dinesh
Global Environment
Barshefsky defends fast track goal; consensus sought on
environment
During a Tuesday hearing of the Senate Finance Committee, much to
the dismay of Chairman William Roth (R-Del) and ranking member
Patrick Moynihan (D-N.Y.), U.S. Trade Representative Charlene
Barshefsky reconfirmed plans within the Clinton administration to
hold up a pending proposal to reauthorize fast track trade
negotiating authority until around September.
Barshefsky did not, however, indicate how Clinton will approach
in the proposal the contentious issues of labor and the
environment -- only saying that the two areas of debate
constitute the main reason for delay. About 150 congressional
members have met with Barshefsky to discuss fast track, she said,
and Clinton is hoping to reach a bipartisan consensus on both
labor and environment by the end of the summer.
While Roth and many other GOP panel members said they strongly
object to such provisions being included in fast track, some
Democrats only stressed that a bill should be both fair to the
United States and, as Sen. Jay Rockefeller (D-W.Va.) said,
include "appropriate" measures.
Referring to fast track as the "most critical trade issue," Roth
said a bill must be limited to the original intention of
fast-track authority. Sen. Phil Graham (R-Texas) warned that a
bill would certainly not have a chance of passing through
Congress this year if Clinton offers a proposal that uses fast
track to enforce labor and environmental laws. Such matters
should instead be dealt with separately, said Graham, where
amendments can be added.
All of the members present doubted whether fast track could be
completed this year if Clinton withholds the proposal until
September. Barshefsky disagreed and said more than enough time
would be available before the Senate is scheduled to recess for
the year in mid-November.
Under fast track authority which expired in 1994, Congress has 60
legislative days to vote on a proposed trade agreement from the
administration. After a maximum of 20 hours of floor debate, the
vote can only be up or down (amendments prohibited).
Many environment groups believe Clinton is preparing a proposal
that would side reference environmental concerns, instead of
including fast track provisions that would enable the United
States to enforce environmental agreements. Many Republicans
believe, on the other hand, tough environmental provisions in
fast track would make countries less willing to negotiate trade
deals -- fearing Congress would amend already existing
concessions. -- Neil Franz
Foreign Operations
State Department authorization bill goes to House floor
The House, at press time, was debating a bill (H.R. 1757) that
would, aside from other provisions, structure the Agency for
International Development under the administrative authority of
the State Department.
The USAID shuffle was originally part of H.R. 1486, but that bill
was stripped on Tuesday by the House Rules Committee to remove a
$16 billion-per-year foreign aid package earlier approved by the
International Relations Committee. H.R. 1757 -- authorizing
USAID and a couple of similar agencies under State -- and a bill
dealing with NATO are planned to be passed separately and then
sent to the Senate together, said a House Rules Committee GOP
aide.
Although H.R. 1757 was scheduled for floor action on Wednesday, a
vote today (Thursday) was more likely, said congressional
sources. -- Neil Franz