EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503
STATEMENT OF ADMINISTRATION POLICY
(THIS STATEMENT HAS BEEN COORDINATED BY OMB WITH THE CONCERNED AGENCIES.)
March 4, 1997
S.J.Res. 5 - Waiver for USTR Appointment
(Roth (R) DE and Moynihan (D) NY)
The Administration strongly supports the enactment of S.J.Res. 5, which would authorize the appointment of Charlene Barshefsky as the United States Trade Representative.
When the Senate considers S.J.Res. 5, Senator Hollings' amendment relating to the President's long-standing authority to carry out trade agreements may also be considered. The Administration strongly opposes the Hollings amendment, which would effect a major change in trade agreement implementing procedures with immediate and harmful effects on U.S. consumers, firms, and workers. The Hollings amendment would hinder, delay, and, in some cases, jeopardize agreements that greatly serve the Nation's interests.
Harmful Effects of the Hollings Amendment
The Hollings amendment could require congressional approval of every trade agreement that might be construed to require a change in U.S. law. The amendment is unnecessary to assure that the Executive Branch is conforming to congressional mandates on trade negotiations, is overly burdensome for both the President and the Congress, and could endanger the benefits to the United States of some trade agreements.
The overwhelming majority of trade agreements that the President concludes can be -- and traditionally have been -- implemented under existing statutes. If the authority to implement an agreement does not already exist, then the President must seek that authority. If the President were to implement an agreement in a manner that is not authorized by law, the courts can strike down such actions. If the Congress disagrees with a trade agreement, it can pass legislation directing the President to implement the agreement in a particular way or to refrain entirely from implementing that agreement. If a trade agreement requires a change in statutory law, Congress alone has the authority to make such a change. The Hollings amendment is unnecessary to clarify this point.
However, the Hollings amendment goes much further, and the absence of hearings has precluded a full opportunity to determine precisely what the implications of the amendment are. By requiring Congressional action whenever a trade agreement would "in effect" change U.S. law, the Hollings amendment could impose long delays on implementing trade agreements that would otherwise bring immediate benefits to U.S. consumers, firms, and workers. Moreover, the vague term "in effect" would cause great uncertainty, since the amendment leaves undefined who determines when an agreement "in effect" requires a change in law and what implications arise for implementing changes in regulation or administrative practice called for in trade agreements.
The burdensome character of the amendment becomes clear when one considers that the Administration concluded approximately 200 trade agreements in the last four years. Under the Hollings amendment, any such agreement that occasioned any change in law, including technical and typically non-controversial changes to our tariff schedule, would have to be approved by the Congress.
The prospect of nearly continuous consideration of trade agreements by the Congress also raises the possibility of delaying the entry into force of agreements beneficial to the United States. For example, the Hollings amendment could greatly delay -- and perhaps jeopardize -- recent agreements that:
If the Hollings amendment were applied to these agreements, they would have to be submitted to Congress for review and approval. Yet each of these agreements was negotiated under congressional authorization and in close consultation with Congress, and each enjoys overwhelming industry support.
- eliminate tariffs on 400 pharmaceutical products shipped to key markets around the world (these tariff cuts had been widely sought by our medical community because of their potential to quickly lower the costs of producing anti-AIDS drugs and other life-saving pharmaceuticals);
- cut $5 billion in global tariffs on semiconductors, computers, telecommunications equipment, software, and other information equipment (these are tariff cuts that directly benefit high-technology products made by some of our most highly competitive industries, and that support 1.5 million manufacturing jobs and 1.8 million related services jobs); and
- open the global market for basic telecommunication services, providing enormous benefits to our dynamic U.S. telecommunications industry.