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Transition Reports (1977) - Commerce Department: Domestic and International Business Administration (1)
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Transition Reports (1977) - Commerce Department: Domestic and International Business Administration (1)
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The original documents are located in Box 34, folder "Transition Reports (1977) -
Commerce Department: Domestic and International Business Administration (1)" of the
John Marsh Files at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald R. Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 34 of The John Marsh Files at the Gerald R. Ford Presidential Library
U.S. DEPARTMENT OF COMMERCE
BRIEFING HANDBOOK
DEPARTMENT OF COMMERCE
*
*
UNITED STATES OF AMERICA
DOMESTIC AND INTERNATIONAL
BUSINESS ADMINISTRATION
Assistant Secretary for Domestic and International Business
L. S. Matthews
Introduction
The Assistant Secretary of Commerce for Domestic and International
Business serves as the principal adviser to the Secretary on all
domestic and international aspects of the Department's responsi-
bilities to promote progressive business policies and growth and
to strengthen the international economic position of the United
States. He directs programs involving: industry, trade, defense
production and industrial preparedness of domestic industry,
export administration, U.S. energy resources, and related economic
matters.
The Assistant Secretary coordinates the Department's domestic
and international business activities with other agencies of
the Government. He represents the Department or serves as
alternate to the Secretary on major interagency committees.
Mission
The Assistant Secretary for Domestic and International Business:
fosters the economic development of U.S. business
through analysis of world industry data, delivery of
technical information, and follow-through on legislated
programs.
promotes the U.S. foreign export trade and assists U.S.
business operations overseas.
addresses the entire issue of imports, assisting in-
dustries which experience difficulties from international
competition and disrupted U.S. markets.
aids in the development of export markets for U.S.
production.
conducts the Department's industrial energy programs,
including conservation and energy utilization.
Summary of Funds and Employment for FY 76, FY 77, and FY 78
Funds
Authorized Positions
FY 1976
$62,617,000
1904
FY 1977
$57,524,000
1639
FY 1978
$57,861,000
1652
Domestic and International Business Administration
L. S. Matthews, Assistant Secretary
The Domestic and International Business Administration (DIBA)
was established in November 1972. The staff of this organization
has responsibility for programs designed to: (1) improve the
U.S. competitive trading position, (2) facilitate U.S. business
operations worldwide, (3) monitor and protect vital U.S. energy
resources, and (4) develop new markets for U.S. goods. The
Assistant Secretary for Domestic and International Business
heads DIBA and reports directly to the Secretary.
There are five program elements within DIBA:
- Bureau of International Commerce
- Bureau of Domestic Commerce
- Bureau of Resources and Trade Assistance
- Bureau of East-West Trade
- Office of Energy Programs
A statement of activities of these elements is found on the
following pages.
Major Statutory Authorities
Major Legal Authorities and Delegations
Directly Applicable to Programs of the
Domestic and International Business Administration
Basic Statutory Authority: The organic statutory authority
for the Department is found at 15 U.S.C. 171 et seq., as
amended, and 15 U.S.C. 1512 et seq., as amended. The
Department has the responsibility to
=
foster, promote,
and develop the foreign and domestic commerce
of the
United States
"
Textile Program: Executive Order 11651 of 1972 delegates authority
regarding Textile Trade Agreements. Under the Agriculture Act of
1956, as amended, the President is authorized to negotiate
international agreements limiting the exports of agricultural
commodities or products thereof and textiles or textile products
from foreign countries to the United States, 7 U.S.C. 1854.
The Arrangement Regarding International Trade and Textiles was
negotiated pursuant to this authority. The United States is
bringing its 27 textile and apparel agreements into conformity
with the new Arrangement Regarding International Trade and
Textiles.
Executive Order 11651 established the Committee for the Implemen-
tation of Textile Agreements (CITA), consisting of representatives
of the Departments of State, the Treasury, Commerce, Labor and a
non-voting representative from the Office of the Special Trade
Representative. The Deputy Assistant Secretary for Resources
and Trade Assistance is Chairman of CITA. CITA is responsible
for the implementation of all textile trade agreements.
Industrial Mobilization:
(a) Priorities and Allocations of Materials for Defense Purposes
The Defense Production Act of 1950, as amended, 50 U.S.C.
App. 2061 et seq., authorizes the President to perform certain
functions relating to the administration of priorities and
allocations of materials and services needed for defense. By
Executive Order 10480, as implemented by Defense Mobilization
Order 8400.1, and Executive Order 11912 the President delegated
the responsibility to Commerce to administer the functions
under the Act with respect to all materials and facilities other
than (i) food and the domestic distribution of farm equipment
and commercial fertilizers, and (ii) domestic transportation,
storage and port facilities except air transport, coastwise,
intercoastal and overseas shipping.
2
(b) Other Defense Responsibilities
The National Security Act of 1947, 50 U.S.C. 401 et seq., as
amended, directs the Federal Preparedness Agency to advise
the President concerning the coordination of military, indus-
trial, and civilian mobilization. Executive Order 11490 directs
Commerce to develop national emergency preparedness plans and
programs in certain areas including production functions and
the regulation and control of exports and imports, under the
jurisdiction of the Department, in support of national security,
foreign policy, and economic stabilization objectives.
Under the Strategic and Critical Materials Stock Piling Act,
50 U.S.C. 98h, Commerce cooperates with the Federal Prepared-
ness Agency in determining materials which are strategic and
critical and the quality and quantity of same to be acquired.
Under Executive Order 10421 the President directs Commerce to
"
establish
security ratings of facilities, based
on the relative importance thereof to defense mobilization,
defense production and essential civilian economy."
Executive Order 11179, as amended by Executive Order 11725,
authorizes the establishment and training of a National
Defense Executive Reserve.
Foreign Excess Property: Section 512 of the Federal Property
and Administrative Services Act of 1949, as amended, 40 U.S.C.
471 et seq., provides that surplus property sold abroad may
not be imported into the U.S. unless Commerce (with respect
to all property other than agricultural commodities) determines
that such importation will alleviate domestic shortage or
otherwise be beneficial to the U.S. economy.
Watch Quotas for Insular Possessions: Public Law 89-805, which
limits the number of watches and watch movements that may be
imported duty-free from U.S. Insular Possessions (Virgin
Islands, Guam and American Samoa) vests the Departments of
Commerce and the Interior with joint responsibility for
allocating territorial quotas among individual producers.
"E" Award Program: Under Executive Order 10978 the Department
administers the President's "E" Award, "E" Certificate of
Service and "E" Star Award program.
Florence Agreement: The Educational, Scientific, and Cultural
Materials Importation Act of 1966, 19 U.S.C. 1202, authorizes
the duty-free entry of scientific instruments by non-profit
institutions, established for educational or scientific
purposes, conditioned upon the determination of the Secretary
of Commerce that an instrument of equivalent value, for the
intended purposes, is not manufactured in the U.S.
3
Certification of Motor-Vehicle Manufacturers: Under the
Automotive Products Trade Act of 1965, 19 U.S.C. 2031 et seq.,
the Department certifies firms as bona-fide motor-vehicle
manufacturers, and maintains a list thereof, for the purpose
of establishing eligibility of persons to obtain duty-free
importation of certain Canadian articles.
Export Control: Under the authority of the Export Adminis-
tration Act of 1969, 50 U.S.C. 2401 et seq., as amended,
the Department administers U.S. export policies regarding
national security, foreign policy and short supply.
Trade with Southern Rhodesia: Pursuant to Executive Order
11322, as amended by Executive Order 11419, the Department has
issued regulations relating to the exportation from the U.S.
of commodities or technical data to or on behalf of Southern
Rhodesia.
Foreign Assistance-Investment Opportunities: By Section 302
of Executive Order 10973, the President delegated to the
Department responsibility for implementing Section 2351 (b) (1)
of the Foreign Assistance Act of 1961, 22 U.S.C. 2151 et seq.,
as amended, that is to " draw the attention of private
enterprise to opportunities for investment and development in
less-developed friendly countries, and areas
Federal Water Pollution Control Act Amendments of 1972: Section
6 of the Federal Water Pollution Control Act Amendments of
1972 (Public Law 92-500, 86 Stat. 816, 33 U.S.C. 1251) requires
the preparation of an annual report from the Secretary of
Commerce to the President and to the Congress on the effects
of pollution abatement on international trade.
Trade Missions: The President is authorized to provide for
U.S. participation in trade missions abroad by the Mutual
Educational and Cultural Exchange Act of 1961, 22 U.S.C. 2451
et seq., as amended. By Executive Order 11034, as amended by
Executive Order 11380, the President assigned this function
to the United States Information Agency (USIA). On June 25,
1962, the Director of USIA redelegated this responsibility to
the Department under authority of Section 5 (e) of Executive
Order 11034.
China Trade Act: The China Trade Act of 1922, as amended, 15
U.S.C. 141 et seq., provides tax incentives for companies engaged
in promoting sale of U.S. goods in China (i.e., Hong Kong and
Taiwan) and directs the Secretary of Commerce to carry out the
purposes of the Act and to supervise the Registrar of the China
Trade Act corporations.
Historical Background
Historical Outline
The functions performed by Domestic and International Business
Administration date from the establishment of the Department
of Commerce and Labor in 1903. Two original bureaus of that
Department, the Bureau of Statistics and the Bureau of
Manufactures were the forerunners of the Bureau of Foreign
and Domestic Commerce.
The Bureau of Foreign and Domestic Commerce was established
in 1912 to "foster, promote, and develop the various manu-
facturing industries of the United States, and markets for the
same at home and abroad, by gathering, compiling, publishing
and supplying all available and useful information concerning
such industries and such markets and by such other methods as
prescribed by the Secretary of Commerce or by law." During
World War I the Bureau served as a national center for economic
information and statistics of resources, transportation and
trade of foreign countries.
In 1922 the functions of the Bureau were expanded to bring the
Department to a closer relationship with American business and
the Bureau grew greatly during the twenties. However, during
the thirties, functions were reevaluated in the light of
depression causing a reduction in the Bureau's size and
functions. During this period, the Bureau served mainly as an
economic research agency to assist the new recovery agencies.
The next major reorganization of Foreign and Domestic Commerce
came in 1941 when, as a result of the war effort, the Bureau
was reorganized around a program of foreign and domestic
requirements for defense and export controls. The Bureau was
a major supplier of data to war emergency agencies.
Immediately following World War II, general program emphasis
was placed on promotion of foreign trade, service to American
business, and strengthening of the statistical and analytical
programs to provide information to the Government and business.
In 1951, an Assistant Secretary for Domestic Affairs and an
Assistant Secretary for International Affairs replaced an
Assistant Secretary for Foreign and Domestic Commerce thus
splitting the functions into separate organizations. Early
in the fifties emphasis was on the National Production Agency,
the Korean emergency production agency. After the Korean
Emergency, the program emphasis of the Assistant Secretary for
Domestic Affairs returned to the Department's statuatory
responsibility to foster the domestic commerce. Organization
units supervised by the Assistant Secretary included the Office of
Business Economics and the Census Bureau. Emphasis in the
international commerce area continued on the promotion of
foreign trade and commerce.
-2-
In 1962, the domestic and international commerce areas of the
Department were combined under the Assistant Secretary for
Domestic and International Business to provide under one
authority, the entire range of services available to business.
The Assistant Secretary supervised the Bureau of International
Commerce, the Business and Defense Services Administration,
the Office of Field Services and the Office of Foreign
Commercial Services.
The organization remained essentially the same until November,
1972 when the Domestic and International Business Administration
was established as a single primary operating unit under the
Assistant Secretary for Domestic and International Business.
The various business-related organizations were consolidated to
(1) develop a vigorous export expansion program, (2) revitalize
our efforts to achieve a more competitive position in world
markets, (3) develop a new program directed toward the Nation's
growing energy crisis, and (4) stimulate increased East-West
commercial contact.
In November of 1973, a realignment of DIBA functions transferred
all international policy, research and analysis functions into
a single organization reporting to the Deputy Assistant Secretary
for International Economic Policy and Research. Other principal
operating units of DIBA are the Bureau of International Commerce,
the Bureau of Resources and Trade Assistance, the Bureau of
Domestic Commerce and the Bureau of East-West Trade.
In 1975: the Office of Energy Programs was transferred from DIBA
to the Office of the Secretary; the position of Deputy Assistant
Secretary for Field Operations was established, and International
Economic Policy and Research was given bureau status because of
its line functions.
In June 1976, the Bureau of International Economic Policy and
Research was transferred from DIBA to the Assistant Secretary
for Policy, and the Operating Programs of the Office of Energy
Programs and Policy were transferred from the Assistant
Secretary for Policy to the Office of Energy Programs, DIBA.
Organization
TRANSMITTAL
323
United States of America
DEPARTMENT
DEPARTMENT OF COMMERCE
ORGANIZATION ORDER
40-1
DEPARTMENT
DATE OF ISSUANCE
EFFECTIVE DATE
ORGANIZATION
October 13, 1976
October 13, 1976
ORDER SERIES
SUBJECT
DOMESTIC AND INTERNATIONAL BUSINESS ADMINISTRATION
SECTION 1. PURPOSE.
.01 This order prescribes the organization and assignment of functions
within the Domestic and International Business Administration (DIPA).
Department Organization Order 10-3 prescribes the functions of DIPA and
the scope of authority of the Assistant Secretary for Domestic and Inter-
national Business.
.02 This revision incorporates the provisions of a prior
amendment (paragraph 7.04), reflects the transfer of certain
functions of the Office of Energy Policy and Programs from the
Assistant Secretary for Policy to DIBA (paragraph 3.03), the
transfer of the Bureau of International Economic Policy and
Research and certain international commodities functions of the
Office of Import Programs, Bureau of Resources and Trade Assis-
tance from DIBA to the Assistant Secretary for Policy.
SECTION 2. ORGANIZATION AND STRUCTURE.
The principal organization structure and line of authority of DIEA
shall be as depicted in the attached organization chart (Exhibit 1).
SECTION 3. OFFICE OF THE ASSISTANT SECRETARY FOR DOMESTIC AND
INTERNATIONAL BUSINESS.
.01 The Assistant Secretary for Domestic and International Business
determines policy, directs the programs and is responsible for all
activities of DIBA.
.02 The Deputy Assistant Secretary for Domestic and International
Business shall perform such duties as the Assistant Secretary shall
assign; shall carry out the Assistant Secretary's responsibilities
in connection with the Defense Production Act of 1950 as amended
and extended; shall be the principal assistant and advisor to the
Assistant Secretary on public affairs, and administrative matters;
shall direct the activities of the Office of Public Affairs and
the Directorate of Administrative Management; and shall assume the
duties of the Assistant Secretary during the latter's absence.
.03 The Office of Energy Programs shall be headed by a Director,
who shall be responsible for the Department's industrial energy
programs, including conservation and energy utilization;
DCO 40-1
- 2 -
provide data, technical and policy analysis support to the Office of
Energy and Strategic Resource Policy under the Assistant Secretary
for Policy; be the principal DIPA point of contact for the develop-
ment of energy policy and program options and provide, within DIBA,
policy and program guidance for energy and energy-related cammod-
ities found to be in short supply; serve as a point of contact for
and monitor the oil, gas, coal, electric power and other energy
industries, including maintaining and analyzing current and pro-
jected import/export and supply/demand balances; provide appropriate
staff support and/or departmental representation, within guidance
provided by the Office of Energy and Strategic Resource Policy, on
energy-related task forces and committees established to examine
specific energy policy issues and problems pertinent to the U.S.
business community; provide the Executive Director and staff support
for the National Industrial Energy Council (NIEC); establish and
maintain liaison with key energy intensive industries and trade
associations to implement programs for optimum use of energy re-
sources; and serve as a point of contact on technological transfer
connected with effective energy management programs.
SECTION 4. STAFF OFFICES.
.01 The Office of Public Affairs shall advise DIBA officials and organi-
zational elements on all public affairs and information service matters;
provide centralized information services for DIBA; conduct and be respon-
sible for all DIBA publications programs, consonant with the provisions
of Department Organization Order 20-9, "Office of Publications";
provide speech writing and scheduling services for DIBA; and maintain
liaison for DIBA with the Departmental Office of Publications, the
Departmental Office of Communications, and the news and trade media
consonant with the provisions of Department Organization Order 15-3,
"Office of Communications."
.02 The Directorate of Administrative Management shall provide adminis-
trative management services for all DIBA organizational components. The
functions of the Directorate shall be carried out through the principal
organizational elements as prescribed below:
a. The Office of Personnel shall develop and administer person-
nel management programs including recruitment, placement, employee
development, classification, labor-management relations, equal employ-
ment opportunity, and employee relations and provide liaison with the
Departmental Office of Personnel.
b. The Office of Management and Systems shall provide management, or-
ganization and systems analysis, including management studies and sur-
veys and organizational planning studies; conduct a position management
program; coordinate ADP systems development and the DIBA program manage-
ment information system; perform the committee management, directives
management, records disposition management, forms management, files
management, and reports management functions for DIBA; coordinate GAO
- 3 -
DOO 40-1
and Departmental audits within DIBA; coordinate DIBA activity under
the Freedom of Information Act and the Privacy Act of 1974; and provide
liaison with the Departmental Office of Organization and Management
Systems.
C. The Office of Administrative Support shall provide administrative
and support services including personnel, physical and document
security, safety, correspondence control, and space management; shall
provide procurement liaison; and shall coordinate and process communi-
cations between the Department of Commerce and posts abroad, consis-
tent with any administrative agreements between the Assistant Secre-
tary for Domestic and International Business and the Assistant Sec-
retary for Administration.
d. The Office of Budget shall develop the DIBA program structure
and program memorandum; assess program effectiveness; formulate,
present, and execute the budget for DIBA; effect financial and
budgetary controls; prepare budget reports; and provide liaison
with the Departmental Office of Budget and Program Analysis.
SECTION 5. BUREAU OF INTERNATIONAL COMMERCE (BIC).
The Deputy Assistant Secretary for International Commerce shall assist
and advise the Assistant Secretary on export expansion, and shall serve
as National Export Expansion Coordinator. Within the framework of over-
all DIBA goals, the Deputy Assistant Secretary shall determine the
objectives of the Bureau - a mainline component of DIBA - formulate
policies and programs for achieving those objectives, and direct the
execution of Bureau programs. The Deputy Assistant Secretary shall pro-
vide a coordinated DIBA response to the economic situation and business
opportunities in Near East countries including Saudi Arabia, Iran, Egypt,
Israel, Lebanon, Syria, Iraq, Jordan, Kuwait, the United Arab Emirates,
Libya, Morocco, Tunisia, and Algeria. The Deputy Assistant Secretary
shall be assisted by a Deputy Director who shall perform the functions
of the Deputy Assistant Secretary in the latter's absence. The functions
of the Bureau shall be carried out through its principal organizational
elements as prescribed below:
.01 The Office of Market Planning shall provide principal planning and
strategy development for the Bureau; shall develop and review the Bureau's
role, objectives, and operating plans on a worldwide basis; shall
identify those sectors of U.S. industry with the greatest export growth
potential and examine foreign markets offering the greatest export
opportunities to U.S. industry; shall develop guidelines for alloca-
tion of resources for DIBA-sponsored export programs; shall establish
"intensive promotion cycles" for BIC export expansion activities; shall
measure and evaluate Bureau programs; shall be responsible for programs
to represent the interests of the Department to other agencies with re-
gard to the official representation of U.S. commercial interests abroad;
and shall coordinate country commercial programs and the Office of Field
Operations/BIC agreement.
DOO 40-1
- 4 -
.02 The Office of Export Development shall conduct activities in the
United States designed to stimulate export marketing in all segments
of the domestic economy which have the capability to export; shall
develop promotional activities for increasing national awareness of
export potentials and benefits, and for improving Government/business
cooperation in export development; shall be the focal point for the
export expansion activities involving DIBA district offices; shall
provide information on commercial participants in world trade and
furnish specific trade investment opportunities to U.S. businessmen;
shall assist qualified U.S. firms in achieving maximum participation
in major systems and development projects abroad; shall provide
coordination for DIBA participation in domestic trade fairs; shall
encourage foreign direct capital investments and licensing by foreign
firms in the United States; and shall provide information and other
services consistent with U.S. balance of payments policies and objec-
tives, to U.S. firms undertaking investments overseas.
.03 The Office of International Marketing shall provide overseas
marketing assistance to U.S. companies through a variety of informa-
tional and promotional techniques; shall plan and implement individ-
ual country programs to support the marketing needs of U.S. business
on a targeted industry, product, and market basis, and shall maintain
appropriate information services for all such activities; shall direct
the exhibitions program at commercial trade fairs and U.S. trade cen-
ters.
SECTION 6. BUREAU OF RESOURCES AND TRADE ASSISTANCE.
The Deputy Assistant Secretary for Resources and Trade Assistance
shall determine the objectives of the Bureau-a mainline component of
DIBA-formulate the policies and programs for achieving those objectives,
and direct execution of the programs. The Deputy Assistant Secretary
shall be assisted by a Deputy Director who shall perform the functions
of the Deputy Assistant Secretary in the latter's absence. The func-
tions of the Bureau shall be carried out through its principal organi-
zational elements as prescribed below:
.01 The Office of Import Programs shall deal with import
problems involving industries experiencing difficulties from
import competition and with problems in the field of inter-
national trade in industrial products. In support of import
policy formulation and implementation, shall monitor trade
developments which impact on domestic production and employ-
ment, including the extent to which trade effects are con-
centrated in particular geographic areas. For such import-
impacted industries or regions, and as otherwise required, it
shall maintain interagency relationships, and coordinate legislative
comment, international negotiations, and representation with
business and trade groups, and publish periodic reports; analyze
information pertaining to international trade in selected
- 5 -
DOO 40-1
industrial products; and represent the Department in U.S.
Government participation in international agreements and
arrangements on selected industrial products. It shall also
process applications for duty free importation of educational,
scientific and cultural materials (under UNESCO'S Florence
Agreement) and represent the Department at international
meetings on the UNESCO agreement, process applications to im-
port foreign excess property into the United States; perform
staff work pertaining to the allocation of watches and watch
movements among producers in the Virgin Islands, Guam, and
American Samoa; and provide executive secretarial services and
administrative support to the Foreign-Trade Zones Board.
.02 The Office of Textiles shall conduct studies and analyses of the
fiber, textile and apparel sector of the industrial economy; provide
interpretive data on trends affecting the sector's economic stability,
and recommend appropriate Government action to prove the economic
position of the sector; participate in administration and nego-
tiation of international and bilateral textile agreements; and
coordinate interagency relations, legislative comment, and liaison
with relevant industry and trade groups.
SECTION 7. THE BUREAU OF DOMESTIC COMMERCE.
The Deputy Assistant Secretary for Domestic Commerce shall determine the objec-
tives of the Bureau-a mainline component of DIBA-formulate policies and pro-
grams for achieving those objectives, and direct execution of the Bureau's
programs. The Deputy Assistant Secretary shall be assisted by a Deputy
Director who shall perform the functions of the Deputy Assistant Secretary
in the latter's absence. The functions of the Bureau shall be carried out
through its principal organizational elements as prescribed below:
.01 The Office of Industrial Mobilization shall perform national defense
and industrial mobilization functions, as follows: assist in achieving,
through administration of priorities and allocations and other means, an
adequate supply of strategic, critical, and other products and materials
for defense and defense-supporting activities and essential civilian
needs, including the timely completion of current military, atomic energy,
and space programs for production, construction, and research and develop-
ment; and participate in the development of national plans to assure maxi-
mum readiness of the industrial resources of the United States, including
the means for administering them, to meet any future demands of any
national emergency.
.02 The Office of Business and Legislative Issues shall provide analyses
and quantitative assessments of domestic business and legislative issues
that support, supplement or complement activities of other elements of the
Domestic and International Business Administration, the Department, or
other agencies of the Government engaged in developing and evaluating
domestic business policy options.
DOO 40-1
- 6 -
.03 The Office of Business Research and Analysis shall collect, maintain,
and analyze domestic and international data on individual commodities and
industries, such as production, pricing, inventories, marketing, labor,
financing, taxation, and location and size of companies, exclusive of data
related to the fiber, textile, and apparel sector of the industrial
economy, which shall be the responsibility of the Bureau of Resources and
Trade Assistance. (The fiber, textile and apparel sector of the industrial
economy shall be the responsibility of the Bureau of Domestic Commerce
insofar as required for the administration of the Defense Production Act
of 1950, as amended.) This information will be used in support of policy
decisions and program actions by the Bureau of Domestic Commerce, the
Department of Commerce, and other areas of the Government. The Office
shall monitor problem commodities for short supply export controls.
The Office shall also certify U.S. firms as "bona fide motor-vehicle
manufacturers" qualified to trade under the provisions of the U.S.-
Canadian Automotive Agreement, and prepare the President's Annual Report
to Congress concerning implementation of the Automotive Products Trade
Act of 1965.
.04 The Office of Ombudsman shall serve as a focal point for
business assistance, consultation, and advice; receive and respond to
inquiries from business and industry, the Congress, other agencies of
the Government, and the public; identify and take action to clarify busi-
ness concerns involving Government policies and programs; serve as the
Department's contact in consumer affairs matters with other Government
agencies; serve as the focal point for the consumer inquiries, complaints,
and requests for assistance; obtain consumer views and identify and
analyze consumer input on current issues for consideration in the
Department's policy formulation and decisionmaking; conduct periodic
business-consumer relations seminars in conjunction with the District
offices of DIBA's Office of Field Operations, and report on DIBA's con-
sumer representation activities to the Department of Commerce Consumer
Affairs Council. In carrying out its functions, the Office shall not
represent, intervene on behalf of, or otherwise seek to assist business
and individuals on specific matters, cases, or issues before Federal
regulatory agencies or before Federal departments exercising a regula-
tory function with respect thereto; nor shall it participate in, inter-
vene in regard to, or in any way seek to influence the negotiation or
renegotiation of the terms of contracts between business and the Govern-
ment.
SECTION 8. THE BUREAU OF EAST-WEST TRADE.
The Deputy Assistant Secretary for East-West Trade, shall determine
the objectives of the Bureau-a mainline component of DIBA-formulate
policies and programs for achieving those objectives and direct execu-
tion of the programs. The Deputy Assistant Secretary (DAS) shall be
assisted by a Deputy Director who shall perform the functions of the DAS
in the latter's absence. (The Office of the DAS shall include a Hearing
Commissioner who shall conduct hearings and perform other duties with
- 7 -
DOO 40-1
respect to administrative compliance proceedings involving Export Adminis-
tration violations cases, in accordance with the rules set forth in the
Export Administration Regulations.) The objectives, policies and programs
of the Bureau of East-West Trade shall relate to the U.S.S.R., People's
Republic of China, Poland, Romania, Czechoslovakia, Hungary, Bulgaria,
Albania, East Germany, the Soviet zone of Berlin, Cuba, Mongolia and
certain other areas of the world with similar economic/political struc-
tures, and, where necessary for export administration purposes, shall
relate to other countries. The Office shall provide necessary secre-
tariat and support services to the Export Administration Review Board
and to the Advisory Committee on Export Policy. The functions of the
Bureau shall be carried out through its principal organizational elements
as prescribed below:
.01 The Office of East-West Trade Development shall, with regard to the
countries and areas specified, be responsible for developing and imple-
menting program recommendations with regard to trade and other commercial
relations; preparing market assessments on Centrally Planned Economy (CPE)
countries; gathering information bearing on commercial relations and pro-
viding advisory services and information for U.S. firms or industrial
groups; developing and disseminating studies of market potential for U.S.
trade with these countries and areas; developing and executing programs
for U.S. trade promotional events and trade missions to the specified
countries and areas; and coordinating activities relating to foreign
commercial services and commercial representation in these countries.
.02 The Office of East-West Country Affairs shall maintain familiarity
with, and develop and disseminate information and advice on, the economic
and political conditions and policies and the U.S. trade and commercial
relations with the countries and areas listed in Section 8; maintain con-
tacts on East-West trade matters with foreign government officials in the
U.S.; develop and provide country information and advice to other elements
of the Bureau, the Department, the U.S. chairmen of joint trade commis-
sions and members of interagency committees; and provide executive secre-
tariat services to U.S. joint commercial commissions.
.03 The Office of East-West Policy and Planning shall formulate, analyze
and make recommendations about legislative and policy issues arising in
East-West trade activities; coordinate East-West trade policy review
with international trade, finance and other organizations; monitor and
maintain liaison with East-West trade-related national and international
organizations; propose and monitor contracts for analyses of East-West
trade matters and develop and provide statistical data services for the
Bureau.
.04 The Office of Export Administration shall administer and, in conjunction
with the Department's Office of the General Counsel, enforce the regulations
and programs required to carry out Departmental responsibilities under the
Export Administration Act of 1969, as amended; develop policies and measures
for the administration of U.S. exports of commodities and technical data;
seek, in collaboration with other Federal agencies, the adoption by foreign
DOO 40-1
- 8 -
countries of such controls over their exports as will assist the policies
of the United States with respect to trade between the free world and the
specified countries and areas, and with such other areas as national secu-
rity, foreign policy and short supply may require; shall have coordinating
responsibilities for all short supply activities within DIBA and provide
secretariat and support services to the Operating Committee of the Advi-
sory Committee on Export Policy, and Technical Advisory Committees estab-
lished under the Export Administration Act of 1969, as amended.
SECTION 9. OFFICE OF FIELD OPERATIONS.
The Deputy Assistant Secretary for Field Operations shall head the Of-
fice which shall serve as the Department's principal medium of contact
with the business community at local levels for the functions listed
below, most of which will be performed through District Offices and sub-
ordinate Satellite Offices located throughout the country (Exhibit 2).
.01 Ascertaining the needs and desires for information and assistance
relevant to the private economy that fall within the scope of Commerce's
responsibilities, arranging or participating in the effective delivery
of Commerce's business-related information products, and assisting in
the planning and design of additional business information;
.02 Providing local assistance and service to business communities in
utilizing information and related business aids of Commerce and of
other agencies, and performing the field work and services involved in
the programs of DIBA, and for other organizations of Commerce as may
be arranged from time to time;
.03 Promoting participation of the general business community in the
resolution of economic and business problems of the Nation;
.04 Publishing the "Commerce Business Daily"; and
.05 Through the District or Satellite Offices located in the ten
Uniform Federal Regional Council Cities, serving as the Department's
principal coordinator at the regional level for Federal Preparedness
Planning, Crisis Management and Emergency Operations. Accordingly, the
Office Directors in the ten cities (i.e., Boston, New York, Philadel-
phia, Atlanta, Chicago, Dallas, Kansas City, Denver, San Francisco and
Seattle), having been designated Regional Emergency Coordinators, acting
in accordance with instructions and guidance issued by the Director,
Departmental Office of Emergency Readiness, through the Office of Field
Operations, shall represent the Secretary and shall be the principal
advisory and contact point for the Department for emergency readiness
matters in their respective areas.
- 9 -
DOO 40-1
SECTION 10. EFFECT ON OTHER ORDERS.
This order supersedes Department Organization Order 40-1, of November 17,
1975, as amended.
Cound for Domestic S. marthws and International Business
Assistant Secretary
Approved:
Jonseph Assistant Secretary E. Kayputy for
Administration
USCOMM-DC 58407
U.S. DEPARTMENT OF COMMERCE
Exhibit 1 to DOO 40-1
Domestic and International Business Administration
ASSISTANT SECRETARY
FOR DOMESTIC AND
INTERNATIONAL BUSINESS
DEPUTY ASSISTANT
SECRETARY
Directorate of
Office of
Administrative
Energy Programs
Management
Office of Field Operations
Office of
Deputy Assistant Secretary
Office of Personnel
District Offices
Administrative Support
Satellite Offices
Office of
Office of
Management and
Office of Budget
Public Affairs
Systems
Bureau of
Bureau of
Bureau of
Bureau of
Resources and
International Commerce
Domestic Commerce
East-West Trade.
Trade Assistance
Deputy Assistant Secretary
Deputy Assistant Secretary
Deputy Assistant Secretary
Deputy Assistant Secretary
Office of
Office of
Office of
Office of
Industrial
East-West
Market Planning
Import Programs
Mobilization
Trade Development
Office of
Office of
Office of
Office of Textiles
Business and
East-West
Export Development
Legislative Issues
Country Affairs
Office of
Office of
Office of
Business Research
East-West
International Marketing
and Analysis
Policy and Planning
Office of
Office of
Ombudsman
Export Administration
OCTOBER 13, 1976
Exhibit 2 to DOO 40-1
Domestic and Internatonal Business Administration
OFFICE OF FIELD OPERATIONS
Locations of District and Satellite Offices
DISTRICT OFFICES
Albuquerque
Indianapolis
Anchorage
Los Angeles City
Atlanta
Memphis
Baltimore
Miami
Birmingham
Milwaukee
Boston
Minneapolis
Buffalo
Newark
Charleston, W. Va.
New Orleans
Cheyenne
New York City
Chicago
Omaha
Cincinnati
Philadelphia
Phoenix
Cleveland
Columbia
Pittsburgh
Portland, Oregon
Dallas
Reno
Denver
Richmond
Des Moines
St. Louis
Detroit
Salt Lake City
Greensboro
San Francisco
Hartford
San Juan
Honolulu
Savannah
Houston
Seattle
SATELLITE OFFICES
Ann Arbor
Kansas City, Missouri
Asheville, N.C.
Little Rock
Boise
Nashville
Butte
Oklahoma City
Charleston, S.C.
Portland, Maine
Clearwater
Providence
Frankfort
San Antonio
Grand Rapids
San Diego
Jackson, Miss.
Tallahassee
Jacksonville, Florida
Wichita
OCTOBER 13, 1976
Principal Officials
L. S. MATTHEWS
Date & Place of Birth
Local Residence
January 6, 1922
7 Watergate South
Glendean, Kentucky
700 New Hampshire Ave., N.W.
Washington, D.C. 20037
Education
1948 - B.A. Northwestern University, Summa Cum Laude
Military Service
Served in U.S. Coast Guard November 1942 - April 1946
Present Position
Assistant Secretary for Domestic and International Business,
Effective July 12, 1976.
Experience Prior to Present Position
In June 1948, Mr. Matthews joined the Leo Burnett Company, Inc.
of Chicago as a research analyst. He was appointed as Executive
Vice President in charge of Client Services and Marketing in
1961, and became President of the Company in January 1970. He
was named Vice Chairman of the Board in February 1975. From
January 1976 until his present position, Mr. Matthews served as
a consultant to the Leo Burnett Company, Inc.
Honors and Affiliations
Member of Dean's Council of Graduate School of Management at
Northwestern University
Elected to Beta Gamma Sigma National Honorary Society for
Business Schools while at Northwestern University
Trustee of the Hadley School for the Blind
Received Academic Scholarship to Indiana University
DONALD E. JOHNSON
Date & Place of Birth
Local Residence
June 5, 1924
8809 Fircrest Pl.
Cedar Falls, Iowa
Alexandria, Va.
22308
Education
1946: Iowa State University, A.B.
Military Service
U.S. Army, 1942 to 1946
Present Position
Deputy Assistant Secretary for Domestic and International Business,
September 1974.
Experience Prior to Present Position
1969-1974 Administrator of Veterans Affairs - Washington, D.C.
1965-1969 President, West Branch Farm Supply Inc. - West
Branch, Iowa
1965-1966 President, Protein Blenders, Inc. - Iowa City, Iowa
1961-1969 President, D.J. Services, Inc. - West Branch, Iowa
1947-1965 Secretary-Treasurer Johnson's Hatcheries, Inc. West
Branch, Iowa
Honors and Affiliations
National Commander, the American Legion (1964-1965)
The American Legion
AMVETS
Herbert Hoover Library Association (Trustee)
Honorary Doctor of Law, Iowa Weslyan (1972)
ROBERT G. SHAW
Date & Place of Birth
Local Residence
July 9, 1940
3617 Glenbrook Road
Chicago, Illinois
Fairfax, Va. 22030
Education
1963: Carnegie-Mellon University, M.S.
1961: Stanford University, A.B.
Present Position
Acting Deputy Assistant Secretary for International
Commerce, August 1976.
Experience Prior to Present Position
April 1975 to August 1976: Deputy Director, Bureau of
International Commerce, U.S. Department of Commerce.
April 1974 to April 1975: Deputy Special Assistant
to President, The White House.
July 1973 to March 1974: Special Assistant, Office of
Secretary, U.S. Department of Commerce.
1971 to July 1973:
President & Chief Executive
Officer, Computer Merchandising, Inc., Chicago, Illinois.
1969 to 1971:
Executive Vice-President & General
Manager, Market Research Corporation of America, Chicago, Illinois.
1963 to 1969:
Director of Market Information and
Planning, Scott Paper Company, Philadelphia, Pennsylvania.
Honors and Affiliations
Various academic and athletic honors, awards and scholarships.
Degree from Stanford awarded with Honors.
MURRAY S. SCUREMAN
Date & Place of Birth
Local Residence
December 4, 1938
3732 Hummer Road
Harrisburgh, Pennsylvania
Annandale, Va. 22003
Education
Princeton University
Bachelor of Science in Electrical
Engineering -- 1963
Harvard Business
Master in Business Administration -- 1970
School
Military Service
United States Army, Artillery -- 1958-1960
Present Position
Deputy Assistant Secretary for Domestic Commerce/October 1976
Experience Prior to Present Position
1973-1976
U.S. Department of Commerce, Washington, D.C.:
Served as Executive Assistant to Ambassador
Frederick B. Dent while he was Secretary of
Commerce and in his current position as Special
Representative for Trade Negotiations.
1970-1973
Singer Business Machines, Chicago, Illinois:
Sold to Sears, Roebuck and Co. the retail industry's
first successful electronic point-of-sale computer
system. Was responsible for the project from pro-
totype hardware testing through contract negotiation
and field implementation.
1969
Arthur D. Little, Cambridge, Massachusetts:
As a Staff Consultant specialized in strategy develop-
ment and implementation of data processing projects.
1963-1968
International Business Machines, Trenton, New Jersey:
As a Systems Engineer and then Marketing Repre-
sentative sold and installed the full range of IBM's
computer systems to major manufacturing, institu-
tional and scientific customers.
ROBERT E. SHEPHERD
Date & Place of Birth
Local Residence
March 11, 1927
4111 Vacation Lane
Garden City, Kansas
Arlington, Va.
22207
Education
1951-1953:
Oxford University
1948-1951:
State University of Iowa, A.B.
1946-1948:
Eastern Oregon College
Military Service
1945-1946: U.S. Navy
Present Position
Acting Deputy Assistant Secretary for Resources and Trade
Assistance, September 1976
Experience Prior to Present Position
1975-1976:
Deputy Director, Acting Director and Director,
Office of Energy Programs
1974-1975:
Acting Deputy Director, Bureau of Resources
and Trade Assistance
1973-1974:
Director, Office of Energy Programs
1969-1973:
Office of Emergency Preparedness; Chief,
Oil and Energy Division
1956-1969:
Policy Analysis and program development with
the Office of the Secretary of Defense and
the United States European Command
Honors and Affiliations
Rhodes Scholarship
Siam Society
Several Outstanding Performance Awards from the Office
of Energy Programs and the Department of Defense
ARTHUR T. DOWNEY
Date & Place of Birth
Local Residence
August 17, 1937
6629 31st Street
New York City, N.Y.
Washington, D.C.
20015
Education
1963: Georgetown University, LL.M.
1962: Villanova University, LL.B.
1959: St. Vincent College, A.B.
Military Service
None
Present Position
Deputy Assistant Secretary for East-West Trade, January 1975
Experience Prior to Present Position
1972-1975 Member of the law firm of Morgan, Lewis & Bockius
1969-1972 Staff member of the National Security Council
1964-1969 Lawyer at Department of State
Honors and Affiliations
Fellowship at Georgetown University Law School
American Bar Association
American Society of International Law
JOHN P. GLEASON, JR.
Date & Place of Birth
Local Residence
November 11, 1941
504 Dartmouth Avenue
New York, New York
Silver Spring, Md.
20910
Education
1972
Harvard Graduate School of Business
(Program for Management Development)
1959-1963
Georgetown University, B.S.F.S., Foreign Trade
Military Service
None
Present Position
Deputy Assistant Secretary for Field Operations
Experience Prior to Present Position
1973-1975:
Executive Assistant to the Assistant
Secretary for Domestic and International
Business
1970-1973:
Director of the Special Projects Staff
and Assistant to the Director of the
Bureau of International Commerce
1968-1970:
Investment Banker with Blyth, Eastman
Dillon, Inc.
1967-1968:
Export Project Manager, Office of Inter-
national Marketing/Bureau of International
Commerce
1964-1967:
General Manager with Papagallo, Inc.
(Retail shoe chain)
Honors and Affiliations
1972
:
Department of Commerce Special Achievement
Award
1973
:
Department of Commerce Special Achievement
Award
1975
:
Department of Commerce Special Achievement
Award
1976
:
Department of Commerce Silver Medal Award
for Meritorious Federal Service
Office of Energy Programs
Robert E. Shepherd, Director
Introduction
The Office of Energy Programs is responsible for the Department's
industrial energy programs, including conservation and energy
utilization. The Director, Office of Energy Programs reports
directly to the Assistant Secretary.
Mission
The Office of Energy Programs is responsible for:
working with business and industry to increase their
awareness of, and to promote, energy conservation
and efficiency.
conducting studies on issues affecting energy resources/
energy utilization policies and programs.
maintaining liaison with energy intensive industries and
trade associations to implement programs for optimum
use of energy resources.
monitoring key energy industries including the oil,
gas, coal, electric power and other energy industries.
Summary of Funds and Employment for FY 76, FY 77, and FY 78
Funds
Authorized Positions
FY 76
$2,090,000
57
FY 77
1,795,000
49
FY 78
1,987,000
57
Bureau of Resources and Trade Assistance
Robert E. Shepherd, Acting Deputy Assistant Secretary
Introduction
The Bureau of Resources and Trade Assistance (BRTA) develops
programs which apply to import and textile activities. The
Deputy Assistant Secretary reports directly to the Assistant
Secretary for Domestic and International Business.
Mission
The Bureau of Resources and Trade Assistance has been chartered
to:
deal with problems of industries faced with import
competition.
analyze the status of the fiber, textile, and apparel
sector of the U.S. economy, providing data and policy
recommendations which affect economic stability, and
negotiate international and bilateral textile agree-
ments.
Summary of Funds and Employment for FY 76, FY 77, and FY 78
Funds
Authorized Positions
FY 76
$2,086,000
78
FY 77
$1,959,000
61
FY 78
$1,786,000
59
Bureau of East-West Trade
Arthur T. Downey, Deputy Assistant Secretary
Introduction
The Bureau of East-West Trade's (BEWT) programs relate directly
to trade potential with the U.S.S.R., the Peoples' Republic
of China, Poland, Romania, Czechoslovakia, Hungary, and with
other areas of the world having similar economic and political
structures. The Deputy Assistant Secretary reports directly to
the Assistant Secretary for Domestic and International Business.
Mission
The Bureau of East-West Trade has a specific mandate to:
develop and implement programs which will increase
East-West trade, including market studies, promotional
events, and collection of vital trade statistics.
analyze current U.S. trade and commercial relationships
with these countries, making such data available to
Government and business.
administer the provisions of the Export Administration
Act of 1969, as amended, which regulates the export
of selected U.S. products for reasons of national
security, foreign policy or short supply.
Summary of Funds and Employment for FY 76, FY 77, and FY 78
Funds
Authorized Positions
FY 76
$ 8,700,000
242
FY 77
9,388,000
267
FY 78
10,590,000
267
Bureau of Domestic Commerce
Murray S. Scureman, Deputy Assistant Secretary
Introduction
The Bureau of Domestic Commerce (BDC) promotes the domestic
commerce of the United States by fostering progressive
business policies and growth within the American business
community. The Deputy Assistant Secretary reports to the
Assistant Secretary for Domestic and International Business.
Mission
The Bureau of Domestic Commerce has responsibility for:
legislative and domestic business policy matters
which have broad industry impact or involve broad
sectors of domestic business activity.
commodity/industry activities essential to American
economic growth and stability.
assuring readiness of industrial responses for
national emergencies and an adequate flow of materials
essential for national defense, atomic energy and
other critical programs.
the Department's Ombudsman program which serves as a
focal point for business assistance, consumer affairs,
consultation and advice.
Summary of Funds and Employment for FY 76, FY 77, and FY 78
Funds
Authorized Positions
FY 1976
$ 7,614,000
249
FY 1977
$ 8,667,000
270
FY 1978
$ 8,872,000
278
Bureau of International Commerce
Robert G. Shaw, Acting Deputy Assistant Secretary
Introduction
The Bureau of International Commerce (BIC) was created to
promote the foreign trade of the United States and to assist
U.S. business in its domestic and international operations.
The Deputy Assistant Secretary reports to the Assistant
Secretary for Domestic and International Business.
Mission
The BIC program is designed to:
provide export development services and information
to help American businessmen trade abroad.
operate overseas trade centers, send trade missions
and exhibitions abroad, and provide other services
which promote the sale of U.S. goods abroad.
coordinate program activities of the President's
Export Council.
present the views of exporters in governmental
councils.
Summary of Funds and Employment for FY 76, FY 77, and FY 78
Funds
Authorized Positions
FY 1976
$19,580,000
545
FY 1977
$19,491,000
519
FY 1978
$19,024,000
518
ices
s
EMPLOYMENT IN THE DOMESTIC AND INTERNATIONAL
BUSINESS ADMINISTRATION
November 15, 1976
OFFICE OF THE ASSISTANT SECRETARY FOR DOMESTIC AND INTERNATIONAL
BUSINESS
This office is headed by the Assistant Secretary for Domestic and
International Business, an Executive Level IV position. Included
in his immediate staff are the Deputy Assistant Secretary for
Domestic and International Business and the Director, Office of
Energy Programs. The Assistant Secretary is assisted by the
following offices in carrying out his responsibilities:
No. of
Employees
OFFICE OF ENERGY PROGRAMS
49
The Director of the Office of Energy Programs is a
position filled at the GS-17 level. Personnel in this
office are mostly employed as Commodity Industry
Specialists, Industrial Economists, Program Officers,
General Administrative, Clerical, and Secretarial
employees.
OFFICE OF PUBLIC AFFAIRS
16
The Director of the Office of Public Affairs is a
position filled at the GS-15 level. Personnel in this
office are generally employed as Public Information
Officers, Writer-Editors, Editorial Assistants, or in
General Clerical and Secretarial positions.
CONGRESSIONAL RELATIONS STAFF
04
The Director of the Congressional Relations Staff is a
position filled at the GS-15 level.
OFFICE OF FIELD OPERATIONS
344
Washington
18
Field
326
-2-
No. of
Employees
The position of Deputy Assistant Secretary for Field
Operations is normally filled at the GS-17 level.
Personnel in this office are usually employed as
Domestic or International Trade Specialists and Trade
Assistants, in General Administrative positions, and
as Clerks, Secretaries, and Typists. The vast majority
of personnel employed in the Office of Field Operations
are located in the 43 District Offices across the
United States. These range in size from the New York
City Office with 28 employees to several offices, such
as Albuquerque, New Mexico, with 2 employees.
DEPUTY ASSISTANT SECRETARY FOR DOMESTIC COMMERCE
294
Office of the Deputy Assistant Secretary
13
Office of the Ombudsman for Business
31
Office of Business and Legislative Issues
36
Office of Industrial Mobilization
28
Office of Business Research and Analysis
186
Includes 10 M-Y for GATT
The position of Deputy Assistant Secretary for Domestic
Commerce is a GS-18 position. Employees in the Bureau
of Domestic Commerce are usually assigned as General or
Industry Economists, Commodity Industry Specialists and
Analysts, Trade Specialists, Statisticians, and in
General Administrative, Clerical and Secretarial positions.
DEPUTY ASSISTANT SECRETARY FOR INTERNATIONAL COMMERCE
535
Office of the Deputy Assistant Secretary
15
Commerce Action Group/Near East
34
CAGNE/Overseas
08
Office of International Marketing
318
Washington
244
Overseas
74
Office of Export Development
123
Office of Market Planning
37
The position of Deputy Assistant Secretary for Inter-
national Commerce is filled at the Executive Level V.
Personnel within the Bureau are normally International
Trade Specialists or Assistants, Industrial Specialists,
Exhibit Negotiators, International or Regional Economists,
Industrial Design Specialists, Statisticians, General
Administrative or Secretarial employees.
-3-
No. of
Employees
DEPUTY ASSISTANT SECRETARY FOR RESOURCES AND TRADE
ASSISTANCE
63
Office of the Deputy Assistant Secretary
2
Office of Import Programs
24
Office of Textiles
37
This Bureau is headed by a Deputy Assistant Secretary for
Resources and Trade Assistance, a position normally filled
in the past at the GS-18 level. Personnel employed in the
Bureau are usually Commodity Industry Specialist or Analysts,
Trade Specialist, Economists, those with statistical exper-
tise, and General Administrative, Clerical, and Secretarial
employees.
DEPUTY ASSISTANT SECRETARY FOR EAST-WEST TRADE
272
Office of the Deputy Assistant Secretary
10
Office of Export Administration
169
Office of East-West Trade Development
38
Domestic
34
Overseas
4
Office of East-West Country Affairs
31
Office of East-West Policy and Planning
24
The Deputy Assistant Secretary for East-West Trade is a
GS-18 level position. Employees in the Bureau are generally
International or Regional Economist, International Trade
Specialist, Statisticians, Industrial Specialists,
Criminal Investigators, Export Compliance Inspectors, or
have General Administrative, Clerical, or Secretarial
Positions.
DIRECTORATE OF ADMINISTRATIVE MANAGEMENT
116
Office of Administrative Support
42
Office of Budget
29
Office of Management and Systems
17
Office of Personnel
28
Employees assigned in this area are those involved in
Personnel Management, Management or Budget Analysis,
General Supply and Travel, as well as those in General
Administrative, Clerical and Secretarial positions.
GRAND TOTAL
1693
Key Issues
and
DOMESTIC AND INTERNATIONAL BUSINESS
Bureau of International Commerce
Need for and definition of Export Promotion Policies
Role and composition of President's Export Council
State/Commerce Commercial Relationships
Bureau of Domestic Commerce
Materials Policy and Federal Organization for
Materials Policy
Economic Health of the Aerospace Industry
U.S./Canadian Automotive Products and Parts
Trade Imbalance
Telecommunications-Government Regulation and
Monopoly versus Independence
Products Liability Program
International Labor Organization Withdrawal
Question
Workers' Compensation
Business-Consumer Relations
Ferrous Scrap
Bureau of Resources and Trade Assistance
Implementation of GATT arrangement regarding
International Trade in Textiles
PRC Textile trends
Renewal of the Multifiber Arrangement
Footwear imports
Import Problem--Steel
Import Problem--Specialty Steel
-2-
Import Problem--Consumer Electronics Products
Bureau of East-West Trade
Normalization of Trade Relations with People's
Republic of China
The Trade Act of 1974 and East-West trade
Appropriate role of the Department in East-West
policy
Controls on the transfer of technology and
export of high technology goods to Communist
countries
Normalization of commercial relationships with
Cuba
Office of Energy Programs
Relationships between DOC and the Business
Community
Industrial Conservation: Division of Responsi-
bilities between FEA and DOC.
Energy Export Policies and Levels
Need for and Definition of Export Promotion Policies
Background
Export Promotion needs remain no less critical today than in
the past. The United States does not yet appear to be
exporting to its full potential consistent with comparative
advantage and to this extent, is not fully maximizing its
potential gains from trade. The Bureau of International
Commerce efforts to foster and promote a further expansion
of exports and a stronger export community are:
A. Serving U.S. policy and economic interest
B. Answering express needs and desires of the U.S.
business community
This is important when we consider that:
- nearly 8 million Americans are unemployed;
- plant utilization in some instances is running at
less than 75% of capacity;
- U.S. industry is exporting less than 15% of its
output;
- only about 8% of U.S. manufacturers are currently
active in exporting;
- U.S. imports, particularly energy, are on the rebound;
- rich export markets in OPEC and other resource-rich
emergent countries are largely untapped; and
- major competitor countries are intensifying their own
promotion efforts.
Comparing official U.S. export promotion efforts with those of
other countries, in 1974 (the latest year for which comparable
data are available) our major competitors spent three times on
the average, the U.S. amount for export promotion per thousand
dollars of manufactured exports--$1.08 compared with 30 cents
for the United States. In that year, our major competitors
also spent 40% more for export promotion as a percent of
total non-defense governmental expenditures.
Issues
(1) The need for full and expressed Administration policy on
the objectives of export promotion and the role of the
Federal Government in reaching these objectives.
(2) The need to resolve the question whether Departmental
export promotion efforts should be directed almost
exclusively to new-to-foreign-market firms (which would
result in a broadening of the export base), or whether
a balance should be aimed at that would include export-
experienced firms into this effort (which would tend to
create large export sales in addition to the broadening
of the export base).
(3) Should consideration be given to small-and medium-sized,
export-capable firms for whom the cost of participating
in a Commerce-sponsored trade event becomes prohibitive?
(4) Should the Government achieve "full cost recovery" for
its export efforts by charging industry the cost of its
promotions?
(5) Clarification is needed as to who should have the
responsibility and therefore also the authority to
devise and execute the Government's export promotion
programs. Should it be the Department of Commerce or
the Office of Management and Budget which, through its
instructions to the Department, directs its export
promotion efforts, if not in name then in effect?
Analysis of Issue
The above issues are of extreme importance because of differences
of opinions among agencies and OMB. For the past two years,
a debate has continued within the Executive Branch on the
national objectives served by export promotion and the proper
role of the U.S. Government in this area. In March 1975, OMB
issued a draft report on the subject in which it put forth
limited objectives and a considerably diminished role for
export promotion. The primary agencies involved in export
promotion, Commerce, State, Export-Import Bank and Agriculture
took exception to these findings. The debate is unresolved
to this day.
Schedule
The White House should, at the earliest possible time, determine
and issue export promotion objectives and state the role and
level of Federal participation in export promotion.
Hearings should be held, at the earliest possible time, by the
relevant Senate and/or House oversight committees to determine
the objectives and proper U.S. Government role in export
promotion.
The Secretary of Commerce should meet with the Director of OMB
to reexamine and resolve issues two, three, and four above.
Role and Composition of The President's Export Council
Background: The President's Export Council (PEC) was established
by Executive Order in 1973 to serve as a national
advisory body to the President on export expansion
activities. Through the Secretary of Commerce, it
advises the President, the Council on International
Economic Policy, and the President's Interagency
Committee on Export Expansion on matters relating to
export trade.
The Council has two subordinate committees. The
Task Force on Export Promotion, scheduled to terminate
December 31, 1976, has been reviewing Commerce's
Export Promotion Programs. The Subcommittee on
Export Administration provides advice and offers
recommendations on ways to minimize the adverse
impact of export controls on U.S. business. The
subcommittee's activities are viewed as long-term
in nature.
The PEC membership consists of a Chairman, a Vice
Chairman, and twenty other members representative of
business and industry. Each member is the chief
executive officer of his firm. Members are appointed
by the President and serve at his pleasure. Presently,
the Council has two vacancies and the position of Vice
Chairman will be vacated effective January 1, 1977.
Both the PEC and its Subcommittee will terminate on
January 5, 1977 unless extended by Executive Order.
Issue:
A decision is needed on whether or not the PEC and its
Subcommittee should be continued and if continued,
whether the role of the Council should be strengthened
and expanded. Replacement of all or a portion of the
Council members must also be determined.
Analysis of
Continuation of the Council and the Subcommittee on
Issue:
Export Administration would keep a line of communication
open between the President, the Secretary and a corps of
chief executive officers of major U.S. industrial
organizations who provide industry views and recommendations
on export trade matters. There are no other advisory
committees which perform these functions. If the PEC
is continued, its ongoing activities, generally those
agreed upon during a July 13, 1976 joint meeting with
the President's Interagency Committee on Export Expansion
would also continue. The role of the Council would be
strengthened and expanded if the Administration were to
frequently seek the Council's advice.
2.
Additionally, replacement of at least a portion of the
membership would provide new impetus to the Council.
However, the current Chairman of the Subcommittee, a
member of the Council, should be retained for reasons
of continuity, irrespective of any other Council member-
ship changes that may ultimately occur.
Schedule:
Decision on continuance of PEC and its Subcommittee -
last quarter CY76
Decision on modifying PEC membership - first quarter CY77
First meeting of reconstituted PEC - second quarter CY77
Appendices: - Executive Order 11753 of December 20, 1973
- PEC membership List
Presidential Documents
Title 3-The President
EXECUTIVE ORDER 11753
Establishing the President's Export Council and For Other Purposes
By virtue of the authority vested in mc as President of the United
States of America, it is hereby ordered as follows:
SECTION 1. Establishment of the President's Export Council. (a)
There is hereby established within the Department of Commerce the
President's Export Council, hereinafter referred to as the "Export Coun-
cil," which shall be composed of a Chaiman, a Vice Chairman, and
twenty other membets representative of business and industry of which
eight members shall be selected without regard to geographic considera-
tions and twelve members shall be selected SO as to provide appropriate
regional representation. The President shall appoint the Chairman, the
Vice Chairman, and all other members of the Export Council.
(12) The Export Council shall serve as a national advisory body to the
President on export expansion activities.
(c) The Secretary of Commerce (hereinafter referred to as the "Sec-
retary") is directed to insure that the recommendations of the Export
Council receive appropriate Governmental consideration.
(d) The Secretary, with the concurrence of the Chairman, shall
appoint an Executive Secretary for the Export Council.
Sr.c. 2. Functions of the Export Council. The Export Council shall,
through the Secretary, advise the President, the Council on International
Economic Policy (CIEP), and the President's Interagency Committee
for Export Expansion (PICEE) on matters relating to export trade. In
particular, the Export Council may-
(1) Identify. and examine problems regarding the effects of industrial
practices on export-trade and the need for industry to improve its export
efforts, and recommend solutions to these problems.
(2) Survey and evaluate export expansion activities which reflect the
ideas of the business community.
(3) Provide liaison among members of the business and industrial
community on export expansion matters.
(4) Encourage the business and industrial community to enter new
foreign markets and to expand existing export programs.
(5) Advise on plans and actions of the Federal Government involving
export expansion policies affecting business and industry.
(G) Provide a forum for business and Government on current and
energing problems and issues in the field of export expansion.
SEC. 3. Subordinate Committees. The Export Council may establish,
with the concurrence of the Secretary, an executive committee and such
FEDERAL REGISTER, VOL. 38, NO. 245-FRIDAY, DECEMBER 21, 1973
54984
THE PRESIDENT
other subordinate committees as it considers necessary in the performance
of its functions. Subordinate committees shall be headed by a chairman
selected from the membership by the Chairman of the Export Council
with the concurrence of the Secretary. Members of the subordinate com-
mittees shall be selected by the Secretary from representatives of business
and industry.
Sec. 4. Administrative Assistance. As permitted by law and as neces-
sary to carry out the purposes of this order, the Secretary may provide or
arrange for administrative and staff services, support, and facilities for
the Export Council, including its executive committee and subordinate
committees.
SEC. 5. Expenses. Members of the Export Council, including its execu-
tive committee and subordinate committees, shall receive no compensa-
-tion from the United States by reason of their services under this order,
but may, to the extent permitted by law, be allowed travel expenses,
including per diem in lieu of subsistence, as authorized by law (5 U.S.C.
5703) for persons in the Government service employed intermittently.
SEC. 6. Federal Advisory Committee Act. The Department of Com-
merce shall perform such functions with respect to the administration of
this order as may be required under the provisions of the Federal Ad-
visory Committee Act (Public Law 92-463; 86 Stat. 770).
SEC. 7. Construction. Nothing in this order shall be construed as sub-
jecting any Federal agency, or any function vested by law in, or assigned
pursuant to law to, any Federal agency to the authority of any other
Federal agency, the Export Council, or its Executive Committee and any
of its subordinate committees, or as abrogating or restricting any such
function in any manner.
SEC. 8. Revocation. The Interagency Committee on Export Expansion
is hereby abolished and Executive Order No. 11132 of December 12,
1963, as amended by Executive Order No. 11148 of March 23, 1964,
is hereby revoked.
Ridand Nifon
THE WHITE HOUSE,
December 20, 1973.
[FR Doc. 73-27035 Filed 12-20-73:11:51 and
FEDERAL REGISTER, VOL. 38, NO. 245-FRIDAY, DECEMBER 21, 1973
PRESIDENT'S EXPORT COUNCIL MEMBERSHIP
R. Hal Dean
*
Fletcher L. Byrom
Chairman of the Board
Chairman of the Board
Ralston Purina Company
Koppers Company, Inc.
Checkerboard Square Plaza
Koppers Building
St. Louis, Missouri 63188
Pittsburgh, Pennsylvania 15219
E. Mandell de Windt
** F. Perry Wilson
Chairman of the Board
Chairman of the Board
Eaton Corporation
Union Carbide Corporation
100 Erieview Plaza
270 Park Avenue
Cleveland, Ohio 44114
New York, New York 10017
J. Robert Fluor
James H. Binns
Chairman of the Board
President
Fluor Corporation
Armstrong Cork Company
P.O. Box 7030
Liberty & Charlotte Streets
Los Angeles, California 90022
Lancaster, Pennsylvania 17604
John L. Hanigan
Werner C. Brown
Chairman of the Executive Committ
President
Brunswick Corporation
Hercules Incorporated
One Brunswick Plaza
910 Market Street
Skokie, Illinois 60076.
Wilmington, Delaware 19899
John W. Hanley
Hugh Chatham
Chairman of the Board
Chairman of the Board
Monsanto Company
Chatham Manufacturing Co.
800 N. Lindbergh Boulevard
Elkin, North Carolina 28621
St. Louis, Missouri 63166
Edward W. Cook
Robert S. Hatfield
Chairman of the Board
Chairman of the Board
Cook Industries, Inc.
The Continental Group, Inc.
2185 Democrat Road
633 Third Avenue
Memphis, Tennessee 38116
New York, New York 10017
* Council Chairman
** Council Vice Chairman
Melvin C. Holm
C. William Verity, Jr.
Chairman of the Board
Chairman of the Board
Carrier Corporation
Armco Steel Corporation
Box 1000
703 Curtis Street
Syracuse, New York 13201
Middletown, Ohio 45043
John V. James
Thornton A. Wilson
Chairman of the Board
Chairman of the Board
Dresser Industries, Inc.
Boeing Company
Box 718
P.O. Box 3707
Dallas, Texas 75221
Seattle, Washington 98124
Reginald H. Jones
Chairman of the Board
General Electric Company
Fairfield, Connecticut 06431
J. Paul Lyet
Chairman of the Board
Sperry Rand Corporation
1290 Avenue of the Americas
New York, New York 10019
David C. Scott
Chairman of the Board
Allis-Chalmers Corporation
1205 S. 70th Street
Milwaukee, Wisconsin 53214
Mark Shepherd, Jr.
Chairman of the Board
Texas Instruments Inc.
Mail Station 236
Box 5474
Dallas, Texas 75222
State/Commerce Commercial Relationships
Background: Until the Reorganization Act of 1939, the Depart-
ment of Commerce (DOC) administered the Foreign
Commerce Service of the United States; however,
since that time, the DOC in its support of the
U.S. business community has had to rely on the
unified Foreign Service of the United States which
is administered by the Department of State (DOS)
The Foreign Service under the DOS has been dominated
by political and consular program demands which
have been consistently and traditionally the
major responsibilities of the DOS. In the view
of the U.S. business community and the DOC, the
DOS has not given the proper program emphasis
and resource allocation to international commercial
and economic program activities within the unified
Foreign Service. Accordingly, the DOC should seek
to assume majority responsibility for management-
related matters which directly affect economic/
commercial functions of the Foreign Service.
Issue:
The DOC has primary international program
responsibilities in the fields of business support,
trade promotion, trade policy, and investment for
which the DOC has received inadequate support from
the Foreign Service as administered by the DOS.
Analysis of There are numerous program deficiencies which could
Issue:
be analyzed and related to the primary issue;
however, those factors of greatest immediate
concern are: (1) The DOC's requirement for
full participation in the management of economic/
commercial operations of the unified Foreign
Service. (2) The DOC is not directly represented
at the DOS (Deputy Under Secretary for Management)
in making the final determination of Foreign
Service resource allocations and budgetary
expenditures. The DOC should press for such
representation as its international commercial
programs are dependent upon Foreign Service staffing
and, to a large degree, DOS funding. (3) The DOC
and the DOS should improve the State/Commerce
(Personnel) Exchange Program in terms of proper
balance of personnel exchangees for executive
and career development purposes so that both
Departments may establish an improved reservoir
of experienced employees to fill key international
commercial positions. (4) The DOC funds and is
- 2 -
held responsible for the management and operation
of the overall Trade Center program. Therefore,
the DOC should have final approval of all Trade
Center personnel assignments. Presently the
responsibility for the staffing of the sixteen
overseas Trade Centers is shared by the DOC and the
DOS. The Centers are staffed by a mix of Foreign
Service personnel and General Schedule employees
of the DOC.
Schedule:
(1) During the second quarter of FY 1977, it is
recommended that a meeting be held between the
Secretaries of the Departments of State and Commerce
to express DOC concern that it fully participate in
the management of the overseas economic/commercial
operations of the Foreign Service.
(2) A request is presently pending to State's
Deputy Under Secretary for Management that the DOC
be represented in making the final determinations
related to Foreign Service resource allocation. If
this issue is not resolved in accordance with DOC's
pending request, it should be on the agenda at the
above recommended Secretarial meeting.
(3) Prior to July 1977, negotiate a new State/
Commerce Exchange Agreement to assure a continuing
personnel source to meet DOC's staffing needs of its
international programs.
(4) During the second quarter of FY 1977, it is
recommended that the Secretary of Commerce negotiate
with State for final approval of all Trade Center
personnel assignments.
Note:
The current State/Commerce review of DOS/DOC
commercial activities, reported under Administration,
should provide additional insights and recommendations
relevant to this problem.
MATERIALS POLICY AND FEDERAL ORGANIZATION
FOR MATERIALS POLICY
Background
There is increasing interest in resources and raw materials
issues, in establishing a coordinated National materials
policy, and in organization of the Executive Branch to deal
with materials policy. Resources/materials policy has been
of concern for a number of years. Both the Paley Commission
(1952) and the National Commission on Materials Policy (1973)
addressed materials policy issues and made general recommen-
dations for actual policy and Federal organization, while
the Mining and Minerals Policy Act of 1970 (P.L. 91-631)
gives the Secretary of the Interior very broad responsibilities
for fostering and encouraging development of domestic mining
and resource recovery industries. The principal recent
interest has been in the aftermath of short supply problems
during the 1973-74 period, the Arab oil embargo of 1973-74,
and growing fears over supply and price stability for
import-dependent commodities. Several proposals have been
made for Federal reorganization, ranging from strengthening
the capabilities of line agencies (e.g., Commerce cr Interior)
to creation of a new Department of Energy and Natural
Resources or creation of a centralized coordinating organization
in the Executive Office of the President.
In addition to organization, considerable interest has been
generated in material policy issues, including the use of
Federal economic stockpiles to prevent supply disruptions,
Federal policies for stockpiling of strategic and critical
materials for military emergency, the impact of environmental
regulation upon materials-producing capacity, Federal land
use policy, and recycling.
The National Commission on Supplies and Shortages is examining
a number of materials-related issues and is expected to
complete its report by the end of 1976, thus providing new
impetus for continued interest in 1977.
The Resource Conservation and Recovery Act of 1976, designed
to foster recycling and disposal of solid and hazardous
waste, provides a number of new responsibilities for the
Department of Commerce.
Issue
The principal issue involves Federal organization for collect-
ing and analyzing information on resources and materials
2
problems and for the formulation of materials-related policy.
At issue is whether centralization of such capabilities or
strengthening of existing agencies would provide the most
efficient and effective mechanism for materials activities.
With respect to actual policies themselves, issues such as
economic stockpiling or prevention of domestic shortages,
generally involve maintenance of long-term stable supplies
of industrial raw materials and development by the private
sector of capacity to produce these materials. These issues
generally entail choices about the degree of Federal involvement
in the private sector, the utility of Federal programs to
accomplish this goal, and an understanding of the role of
Federal policies on materials supply.
Analysis of Issue
The Department of Commerce position has been that, in fact,
there are very few direct materials policies. Instead, there
are a wide variety of Federal policies that have an impact
upon materials supply and demand. These are implemented
by a number of Federal agencies and include: macroeconomic
policies, trade and international economic policies, export
administration, stockpiling acquisitions or disposals,
environment and occupational, health and safety requirements,
land use, and taxation. Centralization of these diverse
activities would not result in the desired goal, but
coordination of Federal policies in terms of their impact
upon materials supply or capacity would.
The National Commission on Supplies and Shortages has
recognized this and is expected to make recommendations the :
would strengthen the capabilities of existing line agencies
for materials data and policy analysis while modestly
strengthening micro-level analysis capabilities in the
Executive Office. The Commerce Department also has emphasized
the need for maintaining expertise and knowledge in individual
commodities or industries in micro-level analysis.
Schedule
The National Commission on Supplies and Shortages will
complete its report by the end of 1976.
Proposals dealing with Federal organization and materials
policy issues are likely to be introduced during the 95th
Congress and throughout calendar year 1977.
FORDO & 9ERALD LIBRARY
ECONOMIC HEALTH OF THE AEROSPACE INDUSTRY
Airlines/Commercial Jet Transport Manufacturing
Background
U. S. airlines employ 300,000 workers and represent a capital in-
vestment of $16 billion. In 1975 scheduled operators carried 205
million passengers 163 billion miles. They transported 4.8 billion
ton miles of freight - a 2.5% decline from 1974 - and moved 80% of
the inter-city first class mail. On this carriage, their net loss
totaled $84 million.
These carriers moved into the black during the first half of 1976
when the 11 major operators posted a traffic gain of 11.7%. For
1976 total industry profits may reach $300 million. Whereas most
analysts agree that the carriers will further increase their earn-
ings for several years, insufficient funds will accrue to finance
purchase of the new aircraft the lines will require for replacement,
to meet noise standards and for future traffic growth.
Traditionally dependent on the domestic airlines for the bulk of
their sales, manufacturers of U.S. jetliners exported 65% of their
production in 1975. The firm order backlog has fallen to ap-
proximately 370 transports, 70% below the backlog of 1,234 planes
in 1969. The builders - with assets of approximately $25 billion -
have not undertaken a new U.S. jet transport project since 1971,
limiting subsequent production efforts to derivatives of current
models. Reflecting this situation, employment in the jet transport
manufacturing segment of the industry will fall to around 44,200
by the end of 1976 - down 65% from the 126,200 of 1968.
Since World War II, the U.S. has produced the great majority of
civil transport aircraft in use worldwide. As late as June 30,
1976, U.S.-built turbo jet-powered aircraft constituted 84% of the
total air transports in use or on order by the world's airlines -
excepting Aeroflot, the Russian national airline. Erosion of this
position has begun.
To improve foreign market position, U.S. aerospace companies have
entered into "offset" arrangements or shared production agreements.
During 1975, transport aircraft produced in the U.S. contained over
14% foreign content in terms of value. Movement abroad of joint
manufacturing ventures constitutes the next step. Already a French
manufacturer has teamed with McDonnell Douglas to produce in France
the Mercure 200, a 174 seat medium-range jet transport fitted with
2 GE/SNECMA CMF56 engines. Another engine joint venture between
Pratt & Whitney and Rolls Royce will produce "10-ton" engines for
new aircraft and retrofit of existing aircraft.
2
Issues
1. Source of funds required by airlines for:
(a) The purchase of aircraft needed for replacement and
future traffic growth; and
(b) Purchase of new aircraft or retrofitting of existing
planes to meet fleet noise standards.
2. Source of funds required by the commercial transport
manufacturing industry to:
(a) Finance the R & D required to assure continued U.S.
technological superiority;
(b) Finance the development - estimated cost $2 billion -
of a new high technology narrow-bodied super critical
wing jet transport; and
(c) To reverse the movement abroad of airframe and engine
manufacturing.
Analysis of the Issue
U. S. airlines continue their efforts to secure CAB approval for rate
increases necessary to cover increased operational costs.
On November 18, 1976, Secretary Coleman announced that the domestic
U.S. commercial aircraft fleet must meet Part 36 Noise Standards by
1985. Unresolved questions remain relative to retrofit or replacement
of the 1,600 older aircraft currently in use which fail to meet the
new standard.
Sales of used aircraft and increased operating revenues will improve
airline cash flow and assist in generating funds required for the
purchase of new aircraft. Investigation of the feasibility of
government loans and of government guaranteed loans continues. In
addition, serious consideration is going to transfer of a portion of
passenger/cargo user charges now flowing to the Airport and Airways
Fund.
Competent authorities estimate the world requirements of new transport
aircraft in the period 1977-1985 will range from $40 to $50 billion.
Maintenance of the U.S. world leadership position in the supply of
jet transports to the Free World's commercial air fleet requires de-
velopment of a new, high technology, narrow-bodied super critical
wing jet transport.
Schedule
Secretary Coleman has scheduled hearings on December 1, 1976 to
discuss financing the aircraft noise reduction program. A report
on the hearings will go forward to the President on or before
March 3, 1977. Should incorporated recommendations involve Federal
assistance to the airlines, Congressional action must follow.
U.S./Canadian Automotive Products and Parts Trade Imbalance
Background
With the objective of freeing up intercountry trade and avoiding a
costly trade war, the U. S. and Canada negotiated the U.S./Canada
Automotive Products Trade Agreement during 1964. President Johnson
and Prime Minister Pearson signed the Executive Agreement at
Johnson City, Texas on January 16, 1965. Duty free importation of
Canadian automotive products retroactive to January 1, 1965 followed
enactment of PL 89-283 on October 21, 1965.
The Agreement has brought benefits to both nations. Total two-way
trade has grown from $716 million in 1964 to over $14 billion in 1975
(Appendix A). Canada's share of North American Automotive Industry
production now stands at 13% versus consumption of 11%. Canadian
employment in assembly operations has increased 9% over the life of
the Agreement; in parts manufacture, 16%.
The traditional U.S. favorable trade balance in automotive products
swung into deficit as the participating companies developed additional
production in Canada. During this period Canada rejected U.S.
proposals for elimination of "transitional" safeguards. In 1973, the
balance moved into surplus again. Substantial surpluses followed in
1974 and 1975.
The net favorable balance in 1975 of $1.8 billion results from a
surplus of $2.4 billion in parts trade and a $.6 billion deficit on
assembled vehicles. As in 1974, the substantial surplus in parts
trade resulted from reduced economic activity in the U. S. rather than
an explosive increase in U. S. exports. As the health of the U. S.
sector improved, the flow of Canadian parts has increased and the
U.S. overall surplus has decreased. Figures for total automotive
products trade through July 1976 show an unfavorable Canadian trade
balance of $610 million compared to $1 billion for the same period
in 1975 (Appendix B).
Issue
As one facet of its program to bring its international accounts into
balance, Canada seeks to reduce its unfavorable balance in automotive
products trade with the U.S. In this effort primary attention is
going to that portion of the deficit for which automotive parts
account - $2.4 billion in 1975.
Analysis of Issue
Through the Agreement the Canadians have achieved their objectives
of increased vehicle production and employment in Canada with safe-
guards. The resulting integrated North American Automotive Industry
has, essentially, allowed free market forces to operate across the
border. Through statements to the press and in public forums,
2
Government of Canada and Canadian industrialists have declared
their continuing support for the Agreement.
The great majority of Canadian parts production is concentrated
in the Province of Ontario. Although total parts production and
parts exports have increased under the Agreement, Government
of Ontario is bringing pressure - in part, political - on the
Federal Government to correct the imbalance in parts trade.
Ontario supports appropriate amendment of the Agreement or some
other intergovernmental action to assure a greater share of the
parts market for Canadian producers. Any such action would affect
production and employment in the U.S. parts and components industry
and introduce additional rigidities in U.S./Canadian trade in
automotive products.
Schedule
We can reasonably expect Government of Canada - under provisions
of the Agreement - to seek a Joint Review of parts trade within
the North American Automotive Industry. Such a request will probably
reach Washington, D.C. during the first quarter of 1977. The Joint
Review will then commence during the second quarter of 1977.
Appendices
A - United States - Canada Trade Automotive Products, 1964, 1969-75
U.S. Imports - Canadian Imports
B - United States-Canada Trade in Automotive Products 1976- - 1975
U.S. Imports - Canadian Imports in Transaction Values
United States - Canada Trade Automotive Products, 1964, 1969
U. S. Impor 3. - Canadian Imports
Millions of U. S. Dollars
1964
1969
1970
1971
1972
1973
1974
1975
/
U. S. exports 2/
Cars
34
732
631
985
1,075
1,439
1,657
2,142
Trucks
23
244
263
334
504
643
916
922
Parts
577
2,134
2,019
2,448
2,866
3,552
3,980
4,409
Sub total
634
3,110
2,913
3,767
4,445
5,634
6,554
7,472
Tires and tubes
6
34
23
36
51
92
223
170
Total exports
640
3,144
2,936
3,803
4,496
5,726
6,777
7,643
U. S. imports
Cars
18
1,537
1,474
1,924
2,065
2,272
2,595
2,809
Trucks
4
560
564
587
713
789
887
917
Parts
49
959
1,080
1,481
1,795
2,172
1,997
2,008
Sub total
71
3,056
3,118
3,992
4,573
5,233
5,479
5,734
Tires and tubes
5
5
14
8
22
68
65
67
Total imports
76
3,061
3,132
4,000
4,595
5,301
5,544
5,801
Net balance
+563
+83
-196
-197
-99
+426
+1,233
+1,842
APPENDIX A
Memo entry
Snowmobiles included
in truck exports above
-
6
12
22
33
30
33
38
Snowmobiles included
in truck imports above
-
111
141
124
104
66
35
28
1/ Preliminary
2/ Canadian import data. Parts exports (Canadian imports) adjusted to exclude tooling
charges in millions of U.S. dollars as follows: 1969-$75; 1970-$98; 1971-$68.
1972-$85; 1973-$68; 1974-$128; 1975-$38.
Note: Data exclude U.S.-Canadian trade in materials for use in the manufacture of automotive
parts.
Data are adjusted to reflect transaction values for vehicles.
$1.00 Canadian = $0.925 U.S., 1964-69; $0.958 U.S., 1970; $0.990 U.S., 1971; $1.009 U.S.,
1972; $0.9997 U.S., 1973; $1.02246, U.S., 1974; $.984001, U.S. 1975.
Source: U.S. Department of Commerce
United States-Canada Trade in Automotive Products 1976 - 1975
(U.S. Imports - Canadian Imports in Transaction Values
(Millions of U.S. Dollars)
July
Cum. Jan. thru July
1976
1975
1976
1975
J.S. Exports
Cars
126.3
132.8
1,311.1
1,132.2
Trucks
89.4
82.2
582.1
542.7
Parts
332.5
297.6
3,185.5
2,465.7
Sub-total
548.2
512.6
5,113.6
4,140.6
Tires and tubes
5.8
12.6
77.1
110.1
Total exports
554.0
525.2
5,190.7
4,250.7
U.S. Imports
Cars
181.9
175.9
2,052.9
1,613.7
Trucks
94.0
66.5
781.0
531.1
Parts
276.7
146.4
1,660.6
1,014.4
Sub-total
552.6
388.8
4,494.5
3,159.2
Tires and tubes
16.7
5.8
85.8
31.9
Total imports
569.3
394.6
4,580.3
3,191.1
Net balance
-15.3
+130.6
+610.4
+1,059.6
Memo entry
Snowmobiles in exports
of trucks above
2.3
2.6
9.1
12.4
Snowmobiles in imports
of trucks above
3.6
2.4
8.4
11.0
1/
Preliminary and subject to revision.
2/
US imports are FAS or transaction values as published by Bureau of
the Census. Canadian automotive imports are valued on similar basis.
3
/ Canadian import data converted to U.S. dollars: C$1.00=US$1.0286,
July 1976; C$1.00=US$0.977, July 1975.
SOURCE: U.S. Bureau of the Census: Statistics Canada.
NOTE:
Monthly figures are preliminary and cumulative year end totals
may contain annual corrections not distributed by months.
15/76
BERALD LIBRARY R. FORD
TELECOMMUNICATIONS - GOVERNMENT REGULATIONS -
MONOPOLY VS. INDEPENDENT COMPETITIVE SERVICES
BACKGROUND
The regulation of telecommunications services and certain products is
a function of the Federal Cummunications Commission (FCC) and State
Commissions under the provisions of the Communications Act of 1934.
(This Act was to provide the nation with a unified telecommunications
network at a reasonable cost.) Their regulations can limit or
encourage competition and can control the economic viability of the
regulated companies by rate structure decisions. The FCC exercises
control over interstate and international communications carriers and
total control over U.S. civil radio frequency assignments. The
various State regulatory commissions exercise economic controls over
carriers within their jurisdiction.
During the late 1960's, the FCC began to introduce competition into
the limited monopoly of the Bell System and some 1,600 independent
telephone companies by authorizing the direct sale or lease of equip-
ment to users on an unregulated basis and authorizing
interstate-intercity private line services between fixed locations by
specialized carriers. These actions are bitterly opposed by the Bell
and independent telephone companies.
Prior to these decisions, interstate toll rates were based primarily
on distance, rather than cost. Basic local telephone service rates
were kept low, in part by charging above cost for extension telephones
and business services, and by transferring some revenue from interstate
toll service to local telephone companies. The FCC's authorization of
competition from specialized common carriers, and sale of interconnect
equipment, pressures the telephone companies toward cost-based rates.
There is much controversy concerning how high some rates might have to
go. In general, economists favor cost-based rates, but many State
regulatory commissions prefer rates based on judgmental and political
factors (value of service based rates), as we have had in the past.
ISSUE
At issue is whether the public will receive better and more economical
telecommunications service from a regulated quasi-monopoly (the Bell
System and the independent telephone companies) or through the
introduction of competiting carriers into the domestic telecommunications
industry and authorization for the interconnection to the telephone
network of switchboard and terminal equipment not owned by the
telephone companies.
Some of the specific items within the issue that require Departmental
policy and economic analysis are:
Alleged increase of local service rates by as much as 75
percent as competition syphons off telephone company revenues.
Duplication of investment and resources.
Division of responsibility and management for end to end
services.
Ability to ensure standardization and interchangeability of
basic telephone equipment.
Terms and conditions of access to national telephone
network - FCC or State level.
Impact upon R&D and innovation in a regulated industry.
ANALYSIS
As a consequence of technological innovation and entreprenurial
motivation, the precepts of the Communications Act of 1934 are being
challenged. In particular, the FCC's role in encouraging competition
in the domestic telecommunications industry is under attack by the
telephone industry. The telephone industry bases its' arguments on
the need to ensure the technical integrity of the National Tele-
communications Network and the claim that the diversion of revenues
from large commercial users to competing specialized carriers will
create an adverse economic impact on the individual telephone
subscribers nationwide.
The telephone industry and other groups, including labor, are
supporting legislation to remedy the problems introduced by the FCC's
regulatory policies. During the past session of Congress, numerous
bills entitled the "Consumer Communications Reform Act of 1976' were
introduced by some 192 sponsors and co-sponsors.
The thrust of these bills is to reaffirm the intent of the Communica-
tions Act of 1934: (1) by reaffirming the authority of States to
regulate the interconnection of customer provided equipment; (2) to
prevent duplication of services by prescribing standards governing
FCC authorization of companies that would provide intercity private
line services; and (3) by assuring true competition between firms
authorized to provide intercity private line service by requiring that
no competitive rates be denied on the basis of being too low if they
are compensatory in terms of the costs involved.
3
Proponents of this legislation are the Bell and independent companies,
the National Association of State Regulatory Commissioners, the labor
unions representing telephone workers, FCC Commissioner Benjamin Hooks,
and Professor Eugene U. Rostow of Yale Law School and Chairman of the
1967-68 Presidential Task Force on Communications Policy. The U.S.
Department of Defense is also expected to favor the bills.
Opponents are the present Chairman of the FCC; the ad hoc Committee
for Competitive Telecommunications; the North American Telephone
Association; and various specialized communications carriers, such as:
MCI, USTS, Southern Pacific, RCA Global, American Satellite, and
Satellite Business Systems.
The FCC is endeavoring to develop a data and analysis base to reach a
conclusion on the question of competition and the public interest.
This requires unique and specialized skills, and is of such magnitude
as to severely tax the capability of the Commission's limited staff.
In addition, however, to the immediate question of regulated monopoly
VS. competition in the domestic telecommunications industry, a
revision of the Telecommunications Act of 1934 must address itself to
impact of technological advancement on the structure of the industry.
Historical concepts are being outmoded. For example: the line of
demarcation between telecommunications and computers is rapidly
vanishing. One, but yet, a major point is the revolutionary change in
production technology now being evidenced in the manufacture of
telephone switching equipment. This equipment represents 30 to 40
percent of telephone system costs. Previously switching equipment was
necessarily electromechanical and required an investment in the
hundreds of millions for machining parts and electrical/electronic
fabrication. The advent of solid state large scale integrated circuits
minimizes the need for large capital investment in machinery, and
permits most product/market oriented organization to enter the
switching-exchange market with a minimum of capital investment.
SCHEDULE
New legislation similar to the "Consumer Communications Act of 1976"
as well as a revision of the Communications Act of 1934 are said to
be priority items for the new Congress.