SENATE-l¥ednesday, September 30, 1981

September 30, 1981 CONGRESSIONAL RECORD-SENATE

SENATE-l¥ednesday, September 30, 1981 22471

<Legislative day of Wednesday, September 9, 1981)

The Senate met at 9 a.m., on the expiration of the recess, and was called to order by the President pro tempore (Mr. THURMOND).

PRAYER The Reverend Norman H. V. Elliott,

rector All Saints' Episcopal Church, Anchorage, Alaska, offered the following prayer:

Let us pray. Almighty God, who reignest over the

nations; in whom we trust and under whose domination our several States are united into one Nation: Grant that Thy presence may be known this day to these men and women called by Thee and chosen by their people to the high omce and great responsibility of U.S. Senator. Guide them in their deliberations and actions that they may attain those things for which they strive-those things which are right and good for all the people of this land; and that this Nation may continue to be dedicated to the building of a world free from fear, oppression, and hunger and to the establishment, defense and preservation of that peace, freed~m. justice, and security for which all Thy people pray. This we humbly ask in the name of Jesus Christ, Thy Son, our Lord. Am'::ln.

RECOGNITION OF THE ASSIST ANT MAJORITY LEADER

The PRESIDENT pro tempore. The assistant majority leader is recognized.

THE JOURNAL ·

Mr. STEVENS. Mr. President, I ask unanimous consent that the Journal of the proceedings be approved to date.

The PRESIDENT pro tempore. Without objection, it is so ordered.

GUEST CHAPLAIN-FATHER NORMAN ELLIOTT

Mr. STEVENS. Mr. President, I am most pleased that the Senate has as guest chaplain today Father Norman Elliott, of the All Saints' Episcopal Church in my home city of Anchorage, Alaska. I thank those who are responsible for assisting in making the arrangements.

Father Elliott and I have been close personal friends since we met in Alaska during the early fifties, and his friendship is one that I deeply cherish.

He is an extraordinary man. He has dedicated his life to the word of God, and over the years he has lived in numerous villages and cities throughout Alaska spreading knowledge and love throughout our State. His efforts have heloed countless people. He has been not only a personal friend, he also is the minister of our church and most recently

performed the marriage ceremony during which Catherine and I were joined together in marriage. We are going to call on him in October for a unique function, which I am sure the current occupant of the chair will appreciate. He will baptize our new daughter, Lily Irene, at the time he baptizes one of my two grandchildren, John Peter, the son of my daughter, Susan.

I do thank the Chair and I thank all of those who helped us.

NINE-DIGIT ZIP CODE

Mr. STEVENS. Mr. President, when the Congress recently acted to delay implementat~on of the nine-digit ZIP code, not everyone breathed a sigh of relief. While critics of the program have received the headlines, many people seem to think ZIP plus four makes sense. In fact, supporters of the expanded ZIP code have difficulty understanding why a system intended to hold down Postal Service costs should meet such resistance.

I agree wholeheartedly with the sentiments contained in an editorial that recently appeared in the Kansas City Star that-

The nine digit ZIP Code ... wm enormously boost postal worker productivity. And that is what holds down rate increases for everyone.

I ask unanimous consent to have this editorial printed in the RECORD. The opinion expressed is one I share with a growing number of Americans.

There being no objection, the editorial was ordered to be printed in the RECORD, as follows:

FOUR MORE DIGITS CAN HELP A LOT Considering how the American people gen

erally have accepted the benefits of automation and computers to do so many intricate tasks for us, the opposition to the Postal Service's proposed nine-digit Z'!P code is difficult to understand. 'Dhe system is not, as so many including some members of Congress seem to believe, a federal command that each of us must memorize nine-digit mailing addresses where five have sumced. The plan is, above all else, voluntary and is aimed primarily at major bulk mailers who account for 80 percent of postal volume.

For them it is simply a matter of encoding the Postal Service's nine-digit ZIPs into their own computers one time and then forgetting it. For the rest of us a letter to Aunt Minnie in Rochester will probably get there earlier if it includes the full nine digits, but a fivedigit ZIP will assure delivery just as now.

The more important consideration for all of us as taxpayers is that this expanded addressing svstem is expected to save the Postal Service $597 million the first full year it is in ccmplete use, about 1987, and is the key to getting the mail service to possible financial self-sufficiency and end the string of deficits. Automatic mail handling looks particularly attractive after the more than 600,000 postal workers have just negotiated a new contract calling for further substantial increases.

The "ZIP-plus-4" system was offlcially supposed to begin July 29, but in fact it will be a phased-in process of several years. So it is not fatal that House opponents were able to insert in the budget reconciliation bill language delaying implementation until October 1983. The Postal Service is allowed to continue all preparatory efforts, including personnel training, machinery procurement and lending out its nine-digit tapes to bulk mailers. But the first 12 optical character reader sorting machines (of an eventual total of 25) will not go on line in September 1982 in New York, Chicago and Los Angeles as scheduled. Nor will an incentive discount of half a cent per unit for mailings of more than 500 pieces take effect until the system is ready to go.

Whenever it begins operation, the ninedigit ZIP code, sorting letters down to an individual letter carrier or one floor in a tall omce building, will enormously boost postal worker productivity. And that is what holds down rate increases for everyone.

ORDER OF PROCEDURE ON SPECIAL ORDERS

Mr. STEVENS. Mr. President, I hope this will be agreeable with the distinguished Senator from West Virginia, my good friend, the minority leader.

There is a series of special orders and some of those who have requested special orders are in a meeting with the executive branch.

I shall request that the Chair not cancel any special order for failure of a Senator to appear until all those who are able to appear and take their time have used their time. In other words, I am certain we do not want to delay the Senate indefinitely, but I do believe there should be no special order in the list of special orders as they have been requested for this morning.

Does the Senator agree with that procedure?

The PRESIDING OFFICER <Mr. MATTINGLY) . Is there objection?

Mr. STEVENS. I did not make therequest yet. I just expressed a hope that we can arrange it without any unanimous consent; to permit those who appear to take the time as they wish and let the order be arranged by the time in which Senators do appear and claim their special orders.

Mr. ROBERT C. BYRD. I certainly have no objection to that, although I think it should be done by unanimous consent because their orders are by unanimous consent and arranged at this time.

ORDER PERMITTING CHANGEABILITY OF ORDERS

INTERSPECIAL

Mr. STEVENS. Then, Mr. President. I do ask unanimous consent that there be no . special arrangement of the special orders that were entered for this morning; that any of the nine Senators who

e This "bullet" symbol identifies statements or insertions which are not spoken by the Member on the floor.

22472 CONGRESSIONAL RECORD-SENATE September 30, 1981

appear may be recognized in whatever order they seek recognition; and that these orders not be canceled until a request is made by the leadership to do that.

The PRESIDING OFFICER. Without objection, it is so ordered.

ORDER DESIGNATING SENATOR PERCY TO CONTROL TIME ALLOCATION ON SPECIAL ORDERS Mr. STEVENS. Mr. President, I ask

unanimous consent that Senator PERCY be permitted to allocate the time <.tnder special orders and the time of the majority to any Member of the Senate as he may see fit.


Mr. STEVENS. Mr. President, I yield to the distinguished Senator from Washington such time under my special order as he may desire.

RECOGNITION OF THE MINORITY LEADER

The PRESIDING OFFICER. The minority leader is recognized.

Mr. ROBERT C. BYRD. Mr. President, I ask unanimous consent that the time under the standing order for the minority leader be reserved until such time as I am recognized in the execution of the 15-minute order which was entered into yesterda v on my behalf.

The PRESIDING OFFiCER. Without objection, it is so ordered.

The Senator from Tilinois.

FISCAL NEW YEAR Mr. PERCY. Mr. President, today,

September 30, marks the end of fiscal year 1981. It is a standard ceremony in our country and in many others throughout the world to ring out the old and ring in the new on the eve of the beginning of a new year. The Jewish community, for example, is celebrating Rosh Hashanah this week, marking the end of one traditional Jewish year and the beginning of the next.

Normally, new year's celebrations simply mark a change in years and there is little to distinguish the last day of the old year from the first day of the new year. It is just a flip of the page on the calendar.

In fact, it is rare when there is any great difference between the past year and the upcoming year. Certainly our hopes for the new year are bright on New Year's Eve, but in hindsight, there is not a marked difference between the last day of the year and the first day of the new year. Change does not ordinarily occur in sudden sweeps.

And when it comes to fiscal year changes, the switch from one fiscal year to the next is usually not even noticed. Certainly the public does not take any significant note of changes in fiscal years. In past years, there has been no strong reason to think there would be any difference between September 30 and

October 1. In fact, there was usually more of the same: Higher and higher Federal spending and rising taxes to pay for it. If anything, the American taxpayer wanted to forget the beginning of a new fiscal year because it meant a heavier tax burden for him. No, in the past, the beginning of the fiscal year was not a time to look ahead to a brighter future. If anything, it might have been a time for some despair on the part of the taxpayer.

But this year it is different. For the first time, the American people have something to actually celebrate and look forward to. For the first time, the future looks a bit brighter than in previous years. Washington has heeded their call for a change in the fiscal posture of the country and enacted an economic recovery program that promises growth and jobs and not retrenchment and rising joblessness.

Today is the last day of the old economic program. In previous years, we have tried almost every anti-inflation program imaginable. President Carter had five anti-inflation programs in 4 years. None of them brought down the rate of inflation. In fact, inflation has increased steadily in recent years, as shown by the following table prepared by the council of Economic Advisers.

Changes in the Consumer Price Index-1976 to 1980

Percent

1976 ------------------------------- +4. 8 1977 ------------------------------- +6. 8 1978 ------------------------------- +9. 0 1979 ------------------------------ + 13.3 1980 ----------- - -------- - --------- + 12.4

The President was elected last year on a platform of getting the economy growing again. As an antidote to inflation, he pledged to cut taxes and reduce Federal spending. It was his top priority and he said it would dominate his agenda in Washington until the economy was put in shape.

Congress passed the President's economic recovery program in almost record time.

We recognized that the economic trends we had experienced in the preceding 4 years would be utterly disastrous for the country. We had waited long enough for a hard-hitting program that would strike at the roots of inflation: Deficit spending.

Tomorrow we will begin the first day of this new program that will . rekindle the economy. That is our purpose in speaking on the floor here today. We want to emphasize that the economic recovery program takes effect tomorrow. It has not had a chance to begin to heal the scars in the economy. We should give it that chance because the budget reductions and tax cuts will make a fundamental change in the American economy-for the better.

I am leading this colloquy today so that the American people will better understand the sweeping nature of the changes that will be taking place beginning tomorrow.

I would like to recall a comment the President made during the leadership

meeting last week in the Cabinet Room. On August 13, the President signed two of the most sweeping bills that any President has ever signed affecting the domestic economy: A sweeping cut in taxes and another bill making the deepest cuts in our history in Federal expenditures. Yet what so frustrated the President was that 48 hours later Wall Street was saying, "But the economic recovery is not working. Where is the evidence?"

Of course, there is no evidence yet of economic recovery other than the fact that inflation rates have already begun to drop sharply. The effectiveness of this program has not yet shown up because its implementation does not begin until tomorrow, the first day of the new fiscal year.

We have selected as a symbol of today's colloquy a rising sun that holds out the promise of a better tomorrow. This is the theme of the economic recovery program. Last February, when the President outlined his new program to Congress, he described the program and the repercussions that would stem from not enacting it. President Reagan said then:

If we don't do this, inflation and a growing tax burden will put an end to everything we believe in and to our dreams for the future. We do not have an option of living with inflation and its attendant tragedy, of millions of productive people willing and able to work but unable to find buyers in the job market. .

We have an alternative to that, a program for economic recovery, a program that will balance the budget, put us well on the road to our ultimate objective of eliminating inflation entirely, increasing productivity and creating millions of new jobs.

True, it will take time for the favorable effects of our proposal to be felt. So we must begin now.

Mr. President. I ask unanimous consent to have printed in the RECORD at the end of my statement a brief summary of the histor:v of the economic recovery program.


<See exhibit 1.) Mr. PERCY. The President's remarks

last February are a throwback to the founding days of this Republic. Inscribed right on our national seal are the Latin words, "Novus Ordo Seclorum"-a new order for the ages. That was the promise at the founding o! this Nation and that is the promise this program revives.

As I mentioned earlier, we chose a rising sun to symbolize our colloquy today. A rising sun also plaved a prominent role at the Constitmtional Convention almost 200 years ago. The chair in which George Washington sat at the convention had a rising sun emblazoned on its back.

Benjamin Franklin sat behind Washington and noted at the time that the artist was not quite able to master the technique of indicating whether the sun was rising or setting.

After the drafting of the Constitution was completed, Franklin noted-and I quote-"but now at length I have the happiness to know that it is a rising and not a setting sun."

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22473

Benjamin Franklin could say tlha.t about the Constitution even before the na:tional capital was established because he could see the outlines of a unique document.

Of course, the proof is always in the pudding and I do not think there is anyone in this Chamber who would now disagree with Franklin's assessment. Our Constitution has allowed this Nation to prosper in unprecedented ways. The Constitution has been honored over the

centuries and served as a guide to our legal and economic development.

The economic recovery program de-serves the same support that some doubting Thomases gave the Constitution in the months after its adoption. It proved itself to be a strong document and I am convinced that President Reagan and the Senate will stand by the economic program and show that it, too, is a strong anti-inflation plan.

I would like to turn for a few minutes to discuss inflation, because that is so key to what we are doing here. Alice Rivlin, director of the Congressional Budget Office, had it about right last year when she said:

Rising Federal spending has been financed partly by increased Federal revenues and partly persistent Federal deficits. In fiscal year 1980, the Federal budget will be in deficit for the eleventh straight year, the nineteenth time in the last twenty years, the forty-second time in fifty years. The size of deficits has also increased during the postwar period. As a percent of the GNP, the average Federal deficit during the 1970s was about double the average during the previous decade.

I want to highlight her statement where she points out that in the 1970's, budget deficits were twice as large-in terms of GNP-as in the 1960's. This is an important point and goes to the heart of inflation. It was precisely in the late 1960's and early 1970's that we began to see inflation heating up. Gradually-and it was a gradual process-people began to expect a significant jump in inflation each year.

Wage settlements began to factor in a cost-of-living increase for the next year that would make up for the past year's inflation and add a few points for the expected inflation of the following year.

Investors were no longer interested in the standard rate of return on stocks, bonds, and savings accounts. With inflation of 7 percent, a 5-percent rate of interest was hardly attractive and investors, too, began to factor an everhigher rate of return into their investment expectations.

Manufacturers and retailers also lost their confidence in the ability of the Federal Government to discipline inflation and their prices began to reflect an inflation premium, too.

In short, the inability of the Federal Government to rein in inflation led all segments of the economy to expect that it would continue yeaJ" after year. And indeed it did. Their expectations were not unfounded.

The country has been through a variety of anti-inflation programs, start-

ing in 1972 with ~rage and price controls. Maybe it was fortunate that we got that out of our system early because it was counterproductive and a dismal failure.

Inflation went from 3.4 percent when the controls were imposed to 12 percent when they were removed 2 years later. The controls simply masked the real problems and the inflation pot continued to boil.

I can remember during that period of time when we, in the infinite wisdom of the Congress, voted to freeze meat prices. We had an unusually late session-until 11:30 p.m.; certainly we have been in later but it was a late session by our usual standard. And I remember I was in the back row at that time, standing there and telling my colleagues :

We will rue the day we have ever done this. The marketplace is the best place to set prices and control supply conditions. And if you try to undercut the marketplace, as we 18J'e now by freezing meat prices, we will disrupt the market in a way we can't divine tonight.

Long before the 90 days were up, the the Congress recognized that it could not outwit the marketplace. This is not the kind of an economy that can control production and prices as totalitarian states do. They do ll'ot do it very well; we do an even worse job of it when we try.

We have tried to control oil and gas prices and look at the result. We have totally distorted the energy situation in this country for years as a result of that.

And certainly it took only days to recognize what we were doing here. What happened in my own city of Chicago is very apparent. Within 60 days Mayor Daley had appointed 250 meat inspectors just to try to crack down on the black market that had sprung up overnight. During World War II, you could buy a bottle of scotch if you bought two bottles of rum with it. The black market thrives during controlled conditions.

And certainly in this kind of a case, the marketplace soon found ways to outwit and work around Government edicts.

But the signal that went to the producers was an ominous one. Their profits were going to be controlled and they might be required to sell their cattle below production prices. And, so they cut back. And for years we did not have the normal supply and demand factors working in the economy, and we lived to regret it. We did reverse that decision before the 90 days were over and we paid the price for years after that.

After this bout with controls, inflation was still with us.

In his brief administration, President Ford got serious with Government spending and showed his commitment to cutting the rate of spending by vetoing overly generous appropriations bills. Partly because of this adherence to fiscal discipline, inflation did drop down to 4.8 percent in 1976.

Unfortunately, it did not stay down for long and began to climb again in 1977. It climbed steadily until 1979 when it hit 13.3 percent, the highest rate in

the post-World War II eTa. In 1980 we did see a sligh~ decline, to 12.4 percent, but this was not the progress that was necessary to reassure the American people that the fight against inflation was being won.

In fact, in the first quarter of 1980, we experienced the most alarming inflation rates in our history as consumer prices hit 18 percent for several months in a row. These rates were akin to the hyperinflation that exists in some Latin American countries and which is totally alien to our economy and democracy.

These rates did not stay high, but they caused enormous concern that we might be entering a new and even higher level of inflation.

Mr. President, Paul McCracken, former Chairman of the President's Council of Economic Advisers, touched on thi3 point in an article in the August 27, 1981 Wall Street Journal. I would like to quote a brief passage from that article because it so accurately sums up my point:

History suggests that government will not follow through. The rational thing for people may be to ignore government's disinflationary rhetoric and policies on the assumption that we shall as usual be in an infln.tionary era. This all makes the inflation itself more difficult to correct, but for more than a decade this has been the realistic basis for decisions.

Now, however, Mr. President, we have embarked on a new course. We should not lose sight of the fact that inflation is already on the run-down this time. not ur.

In the first 6 months of this year, the Consumer Price Index increased by only 8.5 percent. This is still too high but we should not forget that this contrasts with a much, much higher rate last year. Indeed, this is significant progress in its own right,

This declining inflationary expectation is based in large part on the singleminded dedication that the President committed to winning swift passage of the economic recovery program. It was decisive action by the President and the Congress and it sent a message out that we were going to tackle inflation once and for all.

There has been strong commitment to th~s anti-inflation program since it was sent to Congress last winter. There has been an almost quiet confidence building in the country that this President and the Republican-led Senate meant business. No longer would inflation eat up every paycheck in the country.

This discipline is essential. Lindley Clark, Jr., one of the most respected business writers for the Wall Street Journal summed up the importance of this in an article on September 8, 1981. I will not read the entire article but do want to read one paragraph.

Mr. Clark writes that there is an alternative to a prolonged recession to get down inflation and interest rates. He concludes:

The alternative is for government to persuade the public that it really means business. Absolute budget balance lsn'.t

22474 CONGRESSIONAL RECORD-SENATE September 30, 1981 essential, but significant progress in that direction is.

Without this year's budget cutting, the Federal budget would be in far worse shape. We would have a projected fiscal year 1982 deficit of nearly $80 billion instead of the $43 billion cited by the President last week. Certainly $43 billion is too much red ink, too, but as Lindley Clark noted in his article, what is essential is that we show that the direction is toward fiscal discipline and toward the semblance of a balanced budget.

Certainly, this is understandable to security analysts, to Wall Street and LaSalle Street, and on both coasts. They look at the trend of a company's earnings. They look at the direction in which earnings are moving. If they can see a trend, they project out into the future What earnings are likely to be at a point in the future.

Generally, people buy based on confidence and future expectations, just as they sell, generally speaking, when they are discouraged about the future outlook for a particular investment.

After the fiscal 1981 budget deficit of nearly $60 billion, a deficit of $17 billion less in fiscal year 1982 is progress, and fulfills the guidelines so aptly laid down by Lindley Clark in the Wall Street Journal. It is the direction in which we are moving that is important.

We are, for the first time, moving in the right direction. These budget deficits will shrink in each of the next fiscal years until we reach a balanced budget in 1984. Moreover, the President's budget policy reverses a longstanding policy of the Federal Government to increase spending faster than the rate of inflation. This budget that takes effect on October 1 marks an historic change in that pattern of spending and will actually authorize spending at half the rate of inflation.

On the other side of the ledger, taxes would have increased by $104 billion over last year. This massive tax increase would have followed a similarly large increase that we actually experienced in 1980.

Instead of rolling along on this tax juggernaut, President Reagan recommended reducing the tax burden to redirect the economy. Instead of rewarding consumption, we have enacted incentives to spur savings and productivity. The tax cut reversed previous policy of tax increases and replaced it with a 1982 tax cut of $38 billion.

These are new trends in Federal finance. For that reason I asked my colleagues to join me on the floor today to commemorate the beginning of the new fiscal year that launches these trends. We are on the verge of a new era in this country and it is appropriate for us to note the beginning of this new year.

It is a new year and a new beginning. We intend to pursue the economic recovery program's original goal of beating inflation. We will not drop the ball on this program. We will pursue it and adhere to it until the economy is back on the tracks.

Of course, getting back on the tracks involves a number of factors.

Mr. President, I ask unanimous consent to have printed in the RECORD an article which was published in the Washington Post today entitled "U.S. Businesses Urged To Increase Investments Quickly."

I also ask unanimous consent that a September 16, 1981 address by OMB Director David Stockman to the House Republican Conference be printed in the RECORD.

There being no objection, the article and address were ordered to be printed in the RECORD, as follow:

[From the Washington Post, Sept. 30, 1981] U .S . BUSINESS URGED To INCREASE

INVESTMENTS QUICKLY

(By Peter Behr) The National Association of Manufacturers

has called on U.S. business to live up to its "obligation" to increase plant and equipment investments in response to the tax incentives in President Reagan's economic program.

Alexander B. Trowbridge, president of the NAM, said the organization's directors approved a resolution calling on its 12,000 members to "move ahead with their investment decisions as quickly as possible," at a meeting last Friday.

The message followed some sharp criticism of the business and financial sectors by Treasury Secretary Donald Regan, who complained of a disappointing response to the p·resident's tax program. "Where are the expansion plans?" Regan protested to a Midwest audience earlier this month . "It's like dropping a coin down a well- all I'm hearing is a hollow clink," he said .

Trowbridge said the 139 business leaders who attended the NAM board meeting last week believe Reagan's program will reduce inflation and help to lower interest rates over the next 12 months to 16 months.

He said he was optimistic as well that a significant increase in b usiness investment would occur in that period, boosting employment and productivity in the economy.

But while the NAM polled its 139 board members about their general reaction to the Reagan program, it didn't ask the question on the Treasury secretary's mind: How many comnanies will make a significant increase in capital spending?

Jerry J. Jasinowski, NAM chief economist. said it is "unrealistic to think there would be a summertime splurge" in business investment following enactment of the business tax cuts. It takes more time than that for companies to review potential investments, in light of the new tax provisions, and decisions should not be expected until the fall, he said. The response will still come soon enough to improve economic activity in 1982, he nredicted.

The NAM directors were considerablv more confident about the impact of the Reagan program on inflation than they were about the outlook for interest rat es. Of those responding to the NAM poll, 97 percent saw a reduction in inflation in the next year to 16 months, while 85 percent said the president's program would lower interest rates.

The business leaders weren 't in unison on the course the Federal Reserve should follow in regulating the growth of the money supply. Some fear that the Fed's control may squeeze too tightly, causing a painful restriction of business activity. Others believe that continued tight monetary nolicy is necessary to continue progress against inflation .

"The issue was debated at length," Jasinowski said. There was a consensus that current Fed policy is "appropriate," provided

that monetary growth remains within the range of 2 lf2 percent to 5 lf2 percent that has been tentatively adopted for next year by the Federal Reserve.

Trowbridge said the NAM directors also called on the group's membership to increase contributions to charitable organizations and other groups to help the administration's budget cuts in social services.

President Reagan will ask business to make this voluntary effort, Trowbridge said, and the NAM directors will support him. But Trowbridge said he wanted to caution in advance against expecting too much from business. Corporations currently contribute 1.1 percent of pretax income to charities, he said, and while the new tax act raised the limits on deductible contributions, few companies w111 reach the new limit.

COMMENTS OF DAVID A. STOCKMAN

I . In recent weeks there has been a single message from the critics-the press, academic economists, financial houses on Wall Street. It is that the economic game plan doesn 't add up, that it is fundamentally flawed, has internal contradictions. Specifically :

Revenue reductions ($280 billion by 1984) far exceed budget reductions ( $130 billion by 1984).

Therefore, chronic, huge deficits are guaranteed.

Two unequal horses are pull1ng the economy in opposite directions-monetary restraint and high interest rates are holding the economy back while fiscal policy, through the tax cut, is expansionary.

This w111 end in financial disorder and ruin.

II. But let's put some of this analysisand the conclusion that the plan won't work- into perspective. The conclusion is premature, to say the least, and also misses much of the picture.

A. The Tax Cut-the Revenue Side. The static revenue loss seexns large-that

is, old law vs. new law-about $750 billion over the five years to 1986. But this ignores some important points:

All during this period the economy w111 be growing. The GNP w111 rise from $2.8 tr111ion to about $4.8 tr1llion.

The tax share of this rising GNP w111 decline from 22 percent to 18.5 percent. That is the point of the program-more incentives, less burden on work, saving and investment. But with the growth of the economy, the actual dollars of tax revenue collected w111 be rising, not fall1ng. The share of taxes in GNP falls , but revenues rise with a growing economy.

This rise in revenues will be from $600 billion this year to $900 billion in 1986-an increase of 50 percent or about 8.5 percent a year. Even if our economic forecast is not right to the last decimal point, there w111 be a healthy growth in revenues t o finance the government.

Revenues under the old law would have been about $4.6 trillion in 1981- 1986. After the tax cut, revenues w111 still be about $3.9 tr1llion. We can and w111 finance the government with that huge amount of revenue.

The growth of the budget was out of control. From 1979 to 1981, outlays grew at the rate of 15 percent a year-clearly unsustainable. Despite tax bracket creep and rising revenues, we still had chronic large deficits and excessive money growth . Is there any wonder we had our worst peacetime inflation- and many other ills besides?

What is more, if nothing were done-if the government continued on course and added no new programs-outlay growth in the 1982- 86 period would have been at least 9 percent a ye~r and outlays would have cross_ed the tr1111on dollar mark by 1986.

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22475 Already we have started to change this

pattern. Reconcillatlon was the big event. By that one huge bill , which included the first cutbacks in entitlement programs ever accomplished, Congress has cut over $130 billion from the growth of spending between 1981 and 1984.

This is about 60 percent of the job that needs to be done to bring spending on the track where it will at last be matched by revenues and the budget will be balanced. Reconcillation has already brought spending growth down to the range of 7%, percent-half the rate of growth we experienced between 1979 and 1981.

III. The Economic Recovery Package. A. It is of crucial importance to remember

that the tax plan was offered, and enacted, all in one piece. As noted, there will be roughly $280 blllion of tax relief in the 1982-84 period.

B. But the spending plan, from the very beginning, was to be in two installments:

In the current session of Congress-1981-about 60 percent of the total needed was to be achieved, and most of this has been done through reconcillation.

The rest was to be achieved in the 1983 and 1984 budgets-that is, by Congress in 1982 and 1983 .

Meanwhile, all through the period, we had to be on the watch for , and act against, unanticipated overruns-from interest on the debt, farm price supports, even Mount St. Helen 's. This had become a major plague. The last two budgets wound up almost $50 billion over the original estimates by President Carter.

C. The requirement now is to complete the plan:

$30 billion of additional savings in 1983, $44 billion in 1984 were left unspecified in the first part of the plan.

And some additional reductions in 1982 are necessary to combat the overrun problem and make sure our deficit figures are realistic , not just faulty estimates.

This combined action wlll bring outlay growth down to the range we want--roughly 5 percent for the indefinite future.

It will re-fit government spending commitments to a level of about 19 percent of a much larger GNP by 1984--compared to the present 23 percent of a smaller GNP.

It will give us a spending path which allows revenue growth to catch up and balance the budget.

D. It is a tough job, but not nearly as prohibitively difficult as the critics think. The last $44 billion of saving, for 1984, amounts to only 5 percent of the 1984 budget if it were left on automatic pilot--that isthe current services budget for 1984. Given what we have done so far, that is an achievable task.

IV. The financial markets and interest rates.

A. The markets are very skeptical of the Congressional commitment to cut spending-to complete the job. For this and other reasons they fear continued huge deficits .

Given our political system, they believe Congress wm take the tax cut and runwon't deliver on the tough spending choices that are also required.

This will mean large deficits and high interest rates-and the high interest rates, in a vicious circle, will make the deficits worse still because of the higher cost of paying the interest on the national debt.

The economic recovery won't occur, and this will make the deficit worse still because revenues will not be as high as planned.

B. But if we prove the markets wrong, and do the job on spending, the lob itself becomes easier. Here is the paradox:

We will have a manageable, $44 billion cutting task for FY 1984--<>nly 5 percent of

the budget by then-if we stick to the plan and deliver.

But if we panic, backslide, throw in the towel , the market will be right and the deficit will get bigger. The task will then be not $44 billion but $80 billion to $100 billion.

In short, if we act on schedule, the market's fears will be unfounded and the pro!>lem itself becomes easier to solve. Plus, of course, we receive the payoff of lower interest rates and a strongly growing economy.

C. The current reaction of the markets stems from a political judgment, not an economic one . They fear that Congress will take the timid route-not following through with the rest of the plan.

They have reasons for their skepticism. Not one budget plan in the past seven years has materialized. Spending has grown far faster than projected. But if the judgment is a political one, the economic consequences of it give us the situation we have today-above all, high interest rates.

The long-term bond market is dead. There are no buyers. Everyone borrowing in the market now is doing so from banks or with paper of 45 days or less.

A bond worth $1 ,000 in 1979-just two years ago-is now worth $720. These deep losses have produced equally deep scars among the traditional investors in bonds.

The result is a huge traffic jam in the short-term market. It is a case of heavy demand for borrowed funds pressing against a limited supply, with big pressure on the short-term rate- including the prime rate. This supply and demand problem is why rates are so high.

D. The task is to create a financial climate that allows the economy to grow. This can be done if our plan is followed-if Congress follows through on the remaining budget savings.

It is critical to hold the deficit to the range of $42-45 billion in FY 1982.

This will start to re-establish fiscal integrity and also credibility.

We must do it-not make excuses. This means hitting the FY 1982 outlay tar

gets- which involves some additional reductions this year.

And it also means getting an early start on the outyear reductions-the rest of the job.

EXHIBIT 1

SUMMARY OF THE HISTORY OF THE ECONOMIC RECOVERY PROGRAM

0:1. February 18, 1981 , the President outlined his Program for Economic Recovery. It included spending cuts and other measures to reduce shal'!ply the growth rate of federa..I spending and to reduce the deficit; reductions in personal tax rates and business taxes; reductions in the coots and intrusion of Federal government regulations; and a new commitment to a stable monetary policy.

On March 10, 1981, President Reagan transmitted his proposals for a complete revision of the 1982 budget to the Cong.ress, caJling for savings of $6.4 billion in 1981, $48.6 billion in 1982 and a total of $197 biHlon in 1982-84. He indicated that additional savings of $29 .8 billion in FY 1983 and $44.2 billion in FY 1984 would be identified later.

On June 5, 1981 , the President signed into law the .SupplementaJ Appropria-tions and Rescission Act of 1981, which included many of the President'·s proposals to hold down FY 1981 spending. Presidentia·l proposals not approved by Congress will have the effect of increasing FY 1982 and future year spending by $2.1 billion above the levels proposed by the President.

On Augus·t 13, 1981, the President signed int o law the Economic Recovery Tax Act of 1981 which will begin reducing Fede.raJ taxes on October 1, 1981. The tax reduction wUI

total $28:> billion over the three year period 1982-1984.

Also on August 13, 1981, the President signed the Omnibu.;; Reconciliation Act, which reduced entitlement program spending by $13.4 billion in FY 1982 and $43.8 billion tn 1982- 1984. This Act also called for spending reductions in other Federal programs of $21.8' billion in FY 1982 and $88.8 billion in 1982- 1984. However, final decisions on funding for non-entitlement p~ograms remain to be re.solved in the appropriations process, which is now underway. Unfortunately, many of the President'.;; proposals for budget savings were not incorporated in the Reconciliation Act.

Mr. PERCY. I would like to yield now to the distinguished majority leader. No one in the Senate deserves more credit for quickly moving this program through than Senator BAKER. He was extremely skillful in moving the budget and tax cuts through the Senate. Any one of a thousand roadblocks could have stalled the program, but the majority leader was a deft captain. He is probably one of the greatest majority leaders in the Senate's history.

I yield to my colleague from Tennessee.

Mr. BAKER. Mr. President, when we were younger, a first day in autumn usually meant the first day of school, with new lunch pails, shiny new penny loafers and bright argyle socks. Now that we are older, first days in autumn take on a somewhat more important role, such as tomorrow and the beginning of the new fiscal year.

We are all aware that 3ymbolism has a tendency to abound throughout political hallways, yet I can think of few more truly symbolic days in the legislative year, than October 1.

The beginning of the new fiscal year is more than just a new set of accounting books with new numbers. It is a diacritical integration of the economics of the past and the economics of the future, and I want to take this opportunity to state to my colleagues, Mr. President, that this year's integration is different.

For years, this Nation has been on a course of economic spending that reminds one of a trouser pocket that was not rich enough to be deep, but kept on getting holes made in it to give away money that it did not have. Fiscal year 1982 will be the first full year that those holes get repaired, and it is that alteration in our country's economic policies that makes tomorrow so different.

I am proud to say that this Chamber has participated in this transformation. We have joined with a new President on a new program for economic recovery, and we have begun to institute the legislative pillars to make that program a reality.

President Reagan wasted no time in making his proposals to turn our moribund economy around. In February, less than 2 months after the innauguration, Congress received President Reagan's revised budget for fiscal year 1982, and Congress did not procrastinate in its consideration and implementation of the program.

Throughout the spring, Congress enacted the various rescission proposals for fiscal year 1981 and began the difficult


task of translating the Federal budget into the reconciliation framework.

In July, we witnessed the fruition of the process, with the passage of both the omnibus reconciliation bill, and the Economic Recovery Tax Act of 1981-each a monumental legislative undert aking.

This economic metamorphosis cannot be understated. It is the n eoteric response to the catastrophic economic policies of the past and to the will of American voters last November. It is also the essential foundation for a coherent and :firm economic agenda for the future.

This is not to say that our work is done, for it is not. But we are not lowering our expectations. We will continue to work with our President and forge these goals.

Mr. President, I wish to also use this occasion to commend the distinguished senior Senator from Illinois <Mr. PERCY) on his skillful comments regarding our economy and thank him for this opportunity to participate in this colloquy.

Mr. PERCY. Thank you. I see that my good friend and colleague, Senator GORTON is in the Chamber, seeking recognition.

Senator GoRTON is a freshman in the Senate but he has already shown his knowledge of the economy and ability in the Senate. He has skillfully managed the budget resolution this year and is one of the most outspoken and eloquent members of that committee. He was an integral part of the shaping of the economic recovery program and I am pleased to yield to him now.

Mr. GORTON. Mr. President, in January, when I took my seat in the Senate, our national situation was characterized by double-digit inflation, sky-high interest rates, high unemployment and stagnating economic growth. The urgency of the current economic situation was obvious to everyone. In the past 9 months, the administration and this Congress have drafted and passed into law an economic recovery program which will begin to take effect tomorrow. This program, which I strongly support, represents the historic :first step toward the revival of prosperity, but only a :first step. We must continue along our chosen path toward economic recovery.

During this journey, because the trip will be arduous, there will be those who will tempt us to take temporarily attractive detours. But we in the Congress must not be tempted, we must not give into policies that offer instant gratification but only lead to future trouble. That has been the way of the past. Instead, we must demonstrate our resolve to see this journey through to the end. And the way to do this is through a consistency of policy. Let this be our :fiscal new year's resolution.

When President Reagan signed both the "Tax Cut Bill" and the "Budget Reduction Act" on the same day, he and the Congress reversed the economic course followed by our national Government for two decades and put into place the cornerstones of a program for economic recovery. The tax bill provides for the largest reduction in taxes during this century and the budget bill authorizes the biggest reduction in the course of Government spending in five decades.

In my opinion, excessive Government spend~ng has been a major cause of our current economic crisis. The Federal Government has, over the last few years, consistently spent significantly more

· than it has taken in in taxes. Huge deficits have been the inevitable consequence. These deficits can be covered either by borrowing money or by creating money. If the Federal Government torrows to cover the deficits, it uses money that would have otherwise been available to lend to businesses and to individuals. As a direct result, the economy has less new investment capital and the overall rate of productivity and economic growth is lowered. If the money to cover the deficits is created, or printed, then prices rise and inflation worsens. Dur ·ng inflationary periods, like those which we have experienced for the past 15 years, nothing good comes from large budget deficits.

The solution to our economic crisis, in my opinion, had to begin with a reduction in Government spending. The Congress and the President have taken this vital :first step with the Omnibus Reconciliation Act of 1981. This bill reduces Government spending by $35.2 billion for the coming fiscal year-or by more than $150 for every man, woman, and child in this country. The budgets of over 200 domestic programs were cut and some programs, including public service jobs, were eliminated altogether. In addition, almost all major entitlement programs have had their growth rates limited. Reconciliation represents an historic step toward economic recovery.

But budget cutting alone will not solve our economic crisis. The ravages of inftation have gone too far for that. The economic stagnation that characterized the last half of the 1970's testifies to this fact. Something had to be done to stimulate savings and investment and to revive and restore incentives to produce. The Economic Recovery Tax Act of 1981 <by cutting individual and business taxes) is designed to provide these necessary incentives.

Inflation reduces the individual's incentive to save. If goods are going to cost more i~ the future, and that increase in price is greater than what an individual can earn after taxes on savings, the incentive is to buy now.

As a result, the Nation's savings rate has fallen until it is the lowest among all developed countries, and is now at the lowest level in our Nation's history, with the exception of the years of the Great Depression. Capital can only be :financed out of savings, so a low rate of savings means a low rate of investment and capital formation and reduced rates of productivity growth.

Furthermore, inflation works with the progressive tax structure to increase marginal tax rates, often to punishing, incentive-reducing levels. The marginal tax rate paid by the median-income recipient in 1965 was 17 percent, but in 1980 it was 24 percent, which is equivalent to a 41-percent tax rate increase. A person who received twice the median income in 1965 paid a marginal rate of 22 percent. In 1980, he or she paid 43 percent, a doubling of marginal tax rates.

This phenomenon, known as "bracket creep," effectively discourages effort and investment. It is equivalent to increasing the Federal Government's share of the income of a fairly successful business from less than a quarter interest in 1965 to a full partnership in 1980 solely as a consequence of inflation.

Under the provisions of the Economic Recovery Tax Act of 1981, Fede.ral income tax rates will be reduced 25 percent over 33 months. After these cuts have occurred, tax rates will be indexed to the rate of inftation, ending once and for all the problem of "bracket creep."

In addition to the reduction in personal income taxes, business will beneflt from much more rapid depreciation schedules, from the reduction of the capital gains tax, and from the virtual elimination of estate taxes, except for the very wealthy. These tax reductions will go a long way toward restoring the ~ncentives required to stimulate savings, mvestment and the added work effort necessary for economic recovery.

As an integral part of the economic recovery program, the Federal Reserve Board has maintained a tight monetary policy, a necessary step if inflation is to be successfully curtailed. The money supply has been growing this year at less than half the rate averaged over the past 3 years. The rate of inflation, as a consequence, has been falling . Doubtless, as soon as the :financial markets begin to believe that the Federal Reserve Board is serious and will continue a tight money policy in the future, and that the Federal Government is equally serious in maintaining tight controls over the budget, then the rate of inflation will faU permanently. When this happens, a decline in interest rates cannot be far behind.

The heart of the program for economic recovery is to provide the incentives needed for the private sector to solve our current economic crisis. Incentives are provided for individuals to work harder and save more and for business to invest and grow. The ultimate goal is a balanced Federal budget in 1984. This will eliminate the Government as the foremost borrower in our capital markets and allow the Federal Reserve Board to continue a tight money policy to insure that the problem of inflation is permanently solved.

While much of the economic recovery program is now in place, much more needs to be done. Inflation has been an ever-growing curse for 15 years. At many times in the past. attacks on inflation have been mounted and later abandoned. As a consequence, each time this occurred, the solution to the inflation problem became more difficult.

While inflation has recently begun to subside, interest rates have remained high. I am afraid that this should have been exoected. During the decade and a half during which inflation has been increasing, lenders have persistently underestimated the actual increase in the rate of inflation. Everyone remembers the false starts that characterized past a~tempts to stop inflation. It will take ::;orne time to convince the people that this ti.me. we in Government are serious: In order to do this, we must demonstrate our resolve.


The present economic situation seems almost designed to test our resolve. The combination of slower than expected economic activity and higher than expected interest rates have raised the projected budget deficit, now predicted by most economists, to be over $60 billion in 1982. This is $17.5 billion more than the administration predicted. Furthermore, the predicted deficits for succeeding years also appear larger than they did only a few months ago. In my opinion, this situation calls for decisive action. But the action we take must be well considered and above all consistent with the program for economic recovery that we have adopted.

While considering this action, we should not dwell too much on the absolute size of the budget deficit. It does not make a great deal of difference whether the deficit this coming fiscal year is $30 billion or $50 billion. What does matter is that we demonstrate that we have reestablished control over the expenditures of the Federal Government. This, in my judgment, does reQuire that, whatever the deficit is for fiscal 1982 that it be lower in 1983 and lower each subsequent year until the budget is balanced. Then it is vitally important that tight reins be placed on the level of future Federal expenditures.

In order to implement this strategy, I believe that we in the Senate must take immediate steps to further reduce Government expenditures.

Since defense, interest on the national debt, and entitlement programs comprise 77 percent of the budget, it is obvious that national defense and entitlements will have to absorb a major share of the new cuts.

There are those who are already calling for the cancellation of some or all of the tax reductions that begin tomorrow. I have already stated that a reduction of the projected 1982 through 1984 budget deficits is crucial if we are to have a balanced budget in the near future. In order to do this, it may in fact be necessary to delay some of the scheduled future tax reductions. There is, however, a right way and a wrong way to do this. It obviously would be wrong to repeal any of the future tax cuts that create the incentives for economic growth.

It would be equally wrong to make future tax cuts uncertain by tying them to the performance of the economy. What is required today is consistency of Government purpose. Businessmen must have confidence that we will stick to our economic recovery plan. We must ultimately deliver what we have promised. If it is necessary in order to achieve a balanced budget that part of future tax cuts be delayed, then it must be precisely that-a delay and the length of the delay must be measured in months not years. The incentives created by these tax cuts are absolutely essential to the future economic growth and prosperity of our economy.

I do not now support a significant easing of credit by the Federal Reserve. This has been the solution of the past. It worked for only a short time, and ulti-

mately resulted in higher, not lower, rates of interest and inflation.

I believe that a resolute commitment to the strategy of monetary and fiscal austerity is the best way to solve the problems of high inflation and interest rates. If we waiver now, as we so often have in the past, then we shall lose the best chance we have to end inflation permanently.

But we cannot stop there. If our economic recovery program is to work, it is necessary that we have a competitive economy. Since I have recently spoken on this floor about the importance of the antitrust laws, I will confine my remarks on this subject to reminding my colleagues that our recovery program depends on the response of the private sector to the incentives that the expenditure and tax cuts create. Monopoly, ;collusion, prJcefixing can thwart this response. The antitrust laws and their vigorous enforcement are our best defense against this occurrence.

Finally, I believe that even while we are in the midst of the struggle to balance the budget, we give some thought to how we shall make our hard -won gains permanent. We cannot allow Government spending to once again get out of control and in the process fuel another round of inflation.

Mr. PERCY. Mr. President, I am very pleased that my distinguished colleague and chairman of the Governmental Affairs Committee, the author of significant tax legislation, Senator RoTH, has joined me on the floor. He knows, and we all know, that our goals have been straightforward and have been fully supported, overwhelmingly supported, by the Congress. We must first reduce expenditures.

My distinguished colleague, Senator RoTH, has been fighting, as Senator John Williams did before him, to bring down Federal expenditures. I worked with Senator John Williams many years ago when we authored legislation directing the President of the United States to cut the budget. That proposal was signed into law and did drive expenses down. It helped contribute to the first balanced budget we have had in years.

This, now, is the next step. We will continue to work with President Reagan to drive down Federal spending in fiscal 1982, the fiscal year that begins tomorrow, and to drive it down in future years.

As Mr. Lindley says, What is important is to set the right direction. We do not have to balance the budget tomorrow. We know that is impossible. But what we have to do is set the direction so we can balance that budget by 1984. And we will balance that budget. We will be working together to back the President in doing it.

Then we have to bring down taxes. That, of course, goes back to the original work done years ago by my distinguished colleague, Senator RoTH, working with Representative JAcK KEMP in the House. The direction had to be there. We had to bring down individual taxes; we had to bring down corporate taxes; we had to improve amortization and depreciation. We had to bring down the capital gains

tax. We had to lower the tax on estates. We had to provide incentive for savings so that we would save and invest and build up savings. An adequate savings ?ool brings down interest costs. Bringing mterest costs down is the primary focus of our efforts.

Senator RoTH, as chairman of the Governmental Affairs Committee, and, I as the ranking Republican behind him on that committee are working toaether to bring down the cost of Gover~ment regulation to the American people. Its total cost today is in excess of $100 billion. That cost is passed on by business and agriculture to the consumer. We must bring it down.

I am very pleased at this time to yield to my distinguished colleague, who sits in such a critical position, and who has already done so much to bring about and restore the health of this economy.

This is a new beginning and tomorrow begins to see the effective work of the Reagan administration and the Reagan economic program solidly and strongly supported by my distinguished and respected colleague, Senator ROTH.

The PRESIDING OFFICER. Under the previous order, the Senator from Delaware <Mr. RoTH) is recognized for not to exceed 15 minutes.

ON THE BIRTH OF A NEW ERA OF FISCAL RESPONSIBILITY FOR AMERICA

Mr. ROTH. I thank the distinguished Senator from Illinois for his gracious remarks. I am happy to work with him both on the Senate floor and in the Gov~rnmental Affairs Committee in attemptIng to put in place policies essential for the long-term growth of this country.

Mr. President, tomorrow will mark the dawn of a new era for America-its economy and its people.

After decades of exploding Federal spending that has fueled double-digit inflation and massive unemployment the President, with his budget and tax' cut program, has changed the direction of Washington's money machine.

After decades o.f ever-steeper taxes and the resulting stagnation in economic growth, the President has secured passage of the largest tax cut bill in American history.

Taken with his reforms in wasteful bureaucratic regulations, an aggressive program to root out waste, fraud, and corruption in government, these steps will restore the faith of the American people in themselves.

The impact on the future course o! American politics and economic life will be felt for many years to come. The President has successfully charted a new course in American Government. No longer will the people serve the Government, the Government will serve the people.

And, let me say, that the President's tax and spending programs were enacted despite strong opposition in the House because the President kept faith with the American people and made sure their voice was heard in Congress.

The President's program, which takes

22478 ~ONGRESSIONAL RECORD-SENATE September 30, 1981

effect tomorrow, includes spending and tax cuts over the next 3 years. These initiatives, I think it is important to emphasize, represent the first steps in the economic recovery process. We must give this program an opportunity to work.

Clearly, more needs to be done. Interest rates must be reduced. And the President has proposed additional budget cuts designed to further reduce the deficitthereby helping to take pressure off the financial markets and interest rates in general. Indeed, he has called for additional reductions in defense spending of some $13 billion. As encouraging as this proposal is, I personally believe defense spending must be reduced even moreperhaps by as much as $30 billion.

In my judgment, further reductions in Federal spending rather than an abrogation of the tax cut that every working man and woman in this country so justly deserves is the proper approach to reducing the deficit and lowering interest rates. The big spenders among us would like nothing better than a postponement of this tax cut. But this will not occur.

The 3-ye•ar across-the-b01ard tax cut is an integral part of the economic recovery process. And, regardless of the nearterm economic effects from the economic recovery tax act and its other political implications, the movement to reduce the burden of taxes on the American people has strong momentum.

I firmly believe it will be very difficult to reverse that momentum at any time in the foreseeable future, absent a critical national emergency.

Our progressive income tax structure has been under strain for many years, strain greatly exacerbated by inflation, by deterioration in compliance and by growing disillusionment with many of the public programs it was designed to support.

The problems of high income tax rates in terms of equity to all taxpayers and adverse effects on investment decisions and work incentives have become more and more intolerable as the public has wearied of big spending programs that have not produced the desired results.

This does not mean that the American people want to dismantle their Government or abandon the needy and the poor. It means they want a lower profile of government without the most destructive aspects of a confiscatory income tax system.

Mr. President, I share the concerns of the working men and women of this country with respect to continuing nearrecord interest rates. But I believe that policies designed to bring down these rates must look to a permanent and longrun solution, rather than any type of short-term quick fix.

A significant component of today's high interest rates is the fact that many Americans are simply uncertain and confused. This is a direct result of the skepticism of the savers and investors across the country who have for 15 years watched as stop-and-go economic policies in Washington have created a tremendous inflationary momentum that has only now begun to abate. This is the symptom of a long illness to which the medicine is just now being administered.

Calls for quick fixes to the high interest rate problem serve only to add to the uncertainty in the investment community.

I am confident that the policies of further spending and monetary restraint are correct and necessary in order to restore long-term economic strength to this country. There is no other fundamentally sound and correct policy that we can follow. If we delay or vacillate in the implementation of these policies, there will be a need for a more painful administration of them later on.

Only these long-range solutions will insure an end to the steadily escalating cycle of inflation and high interest rates and the cr~ation of an atmosphere of long-term growth and economic stability.

It has taken us 25 years of profligate spending on the Federal level to get into an economic quagmire and we are not going to get out of it overnight. That point has been clear from the beginning of Ronald Reagan's Presidency. It is going to take time to turn the economy around and move back on the road to dynamic growth and stability, with jobs for the young and the unemployed.

There are going to be difficult moments in the months and years ahead, Mr. President, but we have a program to restore the vitality of the American economy.

I look forward to tomorrow and a new beginning for our Nation.

Mr. PERCY. Mr. President, I thank my distinguished colleague for his usual scholarly and practical approach to this problem. I trust that his words will be read carefully by those who can have an influence upon this economy and the decisionmaking process that must make the program work.

Mr. President, I am pleased at this time to yield to the distinguished Senator from Wyoming <Mr. WALLOP), who, himself, is a rancher. I asked him at some point during the course of his comments, to make any observations he would care to make on other procedures that have been tried by the Congress-such as wage and price controls and what happened to meat production, to cattle grazing, when we tried to control prices artificially. There is always a hue and cry during periods of inflation. "Let us get more Government regulation; let us just regulate; you cannot increase wages, you cannot increase prices."

That is a simplistic approach which has been tried and which, in the opinion of the Senator from Illinois, has been utterly disastrous.

It would be interesting to hear from one of those Senators who have stood solidly behind the President, one who is for this program, which will provide a safety net under people, but will remove those programs that we simply cannot any longer afford. This program will move us in the direction of fiscal respons~bility, tax reduction to encourage production, and all of those things necessary to lessen the unnecessary cost of Government regulation.

Mr. President, I am very happy to yield to my distinguished colleague, who has worked so closely with us in enacting this program to begin the new fiscal year.

The PRESIDING OFFICER. The Senator from Wyoming.

Mr. WALLOP. Mr. President, I thank the Senator from Illinois and thank him for arranging for us this morning to have this time to celebrate this new year's eve, the launch of this new beginning.

Mr. President, I find it remarkable that everybody, having cast their votes, is now scurrying like so many cockroaches to the corners and saying, "Well, it may not work, it might not work, there are some people out there who think it will not work."

There are some people out there who always think nothing will work. This country got along by ignoring such prophets of doom.

The country obtained its prosperity by simply looking the other way from those who simply had no courage when it came to attempting something new, trying to change the course of direction, to provide this country with horizons.

Mr. President, I join many of my colleagues in the Senate who have worked hard and have given unselfishly of their t ime and energies to mark the beginning of what history will surely regard as the most dramatic and far-reaching change in the course of American domestic economic policy this country has ever witnessed.

This is not a time to congratulate ourselves on a job well done, for these actions should have been taken long ago. Likewise, this is not a time to look over our shoulders and view all of our accomplishments since the first of the year. Much work remains to be done if this program is to have a chance to succeed. It is with great confidence that I join with my colleagues on this new year's eve of the new beginning to sound the beginning of what promises to be an unprecedented era of economic prosperity for all the citizens of this Nation.

For too many years this country's business and citizens have been literally smothered by Federal policies of overregulation, overspending, overtaxation, and overinvolvement on the part of the Government to try to micromanage one of the world's macroeconomies.

The Senator from Illinois rightly pointed out that one of the catastrophes that has been tried in the past was to select one segment of this economy and control it because there was a popular demand to do so. I happen to be in the profession that was selected out at that time. The country decided that it had a constitutional right to cheap beef, and we had a nice little program which controlled the price of beef, at the behest of consumers across the country. They left ch;.cken alone, left pork alone, left a lot of other things alone. In the process, thev destroyed almost 25 percent of the entire agricultural market of America, the entire agricultural economy.

What happened was that it destroyed the price of grain ; it certainly destroyed the price of cattle. The prices were frozen. Old sows, for sausage, were selling on the Chicago market for more than prime beef. People in the business went bankrupt.


People who were selling the grain and who relied on the grain market for the means by which their products went to market had the market collapse under them because of the price structure.

What happened? Chicken went up. Pork went up. Beef was controlled, so a blackmarket developed, and consumers were badly bruised by that adventure into micromanagement.

The next thing that happened was that many ranchers in the business of raising and producing beef went out of business which resulted in prolonged higher beef prices than there would have been had the market prices been let alone.

The consumer was ill-served by the weak-livered politicians who ran to the control board as soon as there was a little political clout on their horizon. It did not work. It will not work again. The way to make this country prosper is to allow market forces to work and to allow· this country's people to work, and the only way you can do that is to restore some of this economic freedom to the markets by competition.

The inevitable result of those policies-runaway inftation and accelerated interest rates-have affected us all. In the last 3 years alone, the budget deficit has increased by some $142.8 billion more than the entire deficit in this country up through the end of the Kennedy administration. That was just in 3 years. In the last 3 years, we had more than we gathered up through the first 175 years of this country. This happened in spite of the fact that a phenomenon known so well by the American worker and businessman as bracket creep had swelled the Government's coffers to the point that the Government had 205 billion more tax dollars to spend in 1981 than it did in 1978. With all that, we could not come to balancing the budget because nobody tried.

For fiscal year 1982, it was the intention of the past administration to let the taxpayer foot the bills for an even larger budget deficit.

I am sure I do not have to remind my colleagues on the other side of the aisle that with the passing of election day last November, it was painfully obvious that tomorrow had come. Clearly, it was the attitude of the American people that the fiscal irresponsibility of the past could no longer be tolerated. We had been borrowing, and borrowing, and borrowing against the future, as if there were no tomorrow; and we woke up one morning, and tomorrow had dawned. The picture was not one of happiness and prosperity or even an outlook with any expectations in it at all.

Mr. President, it was not long after President Reagan was inaugurated right out here on the west front of the Capitol that he sent to Congress an economic package calling for significant budget cuts, as well as long-deserved and toolong-delayed reductions in the tax burden of the American taxpayer. Congress responded by giving the President most of what he had asked for by implementing evenhanded, across-the-board budget cuts. The American people were given significant relief from a tax burden

which has become increasingly more difficult to bear.

Mr. President, I, like most of my colleagues here this morning, wear a button displaying a rising sun. It is a symbol of the dawning of a new day of economic prosperity and stability for all facets of American economic life which the implementation of the President's program represents. Yet, because of interest rates which remain intolerably high, and an investment community which is unconvinced that Congress-Congress, not the President-will fully implement further components of the President's economic program, there are Members of this body who would wish that we delay, defer, or eliminate certain provisions of the economic recovery program before it even has a chance to work. These conditions are not caused by the policies of this administration. They are, in fact, the most visible of indications that the abuses of the past cannot be overcome overnight. It is an inheritance which this body, as well as the American people, must recognize for what it is, and reaffirm our resolve to correct it.

Mr. President, we have all heard the cry that the tax cut provisions should be delayed until we have a balanced budget. But let me bring into sharp focus a couple of facts which I think should have a bearing on any such consideration. We all know that the 25-percent tax cut is not a tax cut in a literal sense. It is but a mere reduction in the increase in taxes the citizens of this Nation will have to pay because inftation has pushed their incomes into higher and higher tax brackets. In the past, this body, when faced with the prospect of even more money to spend, has done a very predictable thing. It has spent it-and then it spent a little more because it liked the habit into which it had fallen.

Now, some of my colleagues are saying, "Defer the tax cut. Wave that carrot of more tax revenues in front of the Congress and we will resist temptation-this time. We will not spend more-this time. We will balance the budget before the President predicts."

This time, I do not believe Congress could resist this temptation to spend every penny of what it could get if the tax cuts were not in place.

To top it all off, some of my colleagues say they are going to accomplish this feat in the most magnanimous way possible-once again at the increased expense of the poor, benighted American taxpayer. I suggest that this is nothing more than a continuation of the past polices which have put the American economy in its present predicament.

It was Teddy Roosevelt who said, "When a man puts a limit on what he will do, he has put a limit on what he can do." That is what some would have this country achieve.

In a different context the same principle holds true for this body. When we resolve that we will not exact additional revenues from the American taxpayer, we have put a limit on what we can spend. It is only through a reduction in Government spending that this economv will have a chance to get back on its feet.

Mr. President, I conclude my remarks

by noting one thing which I feel we must never lose sight of in the tough months which lie ahead. The President's program is just what it says it is-an economic recovery program. It is only a beginning, a long-awaited new beginning. Our problems were not built overnight, nor will they be solved overnight. We cannot cure the years of overregulation and overspending which have fueled the fires of inftation and sent interest rates soaring by the wave of a magic wand. The President's program has asked that all of us make some sacrifices to restore this Nation's economy. It has been a difficult process, but one which is already showing positive signs of getting our economy back on its feet again. But while much has been done, much more must be done to see this program succeed. It is no time to break stride and to look backward.

President Reagan has charted a new course for America which will lead this country from the darkness of increased unemployment, double-digit inftation, and escalating interest rates to the dawn of a new era of economic prosperity and stability for all Americans. However, this goal cannot be achieved if this Congress does not display the same courage that the President is displaying. Courage is necessary to assure the American people that we will not waiver from that course. Oliver Wendell Holmes once said "The great thing in this world is not so much where we are, but in what direction we are moving." Our course has been setour mandate is clear. Where we were was a catastrophe; where we are going can only lead to new and brighter horizons. Tomorrow will mark the date of our first big step. I wish this country, the President, and this body Godspeed as we set about maintaining that hard and true course in the months to come.

Mr. President, I yield the fioor and thank the Senator from Illinois for his gracious comments to begin with and point out that in the estimation of the Senator from Wyoming he is quite right in pointing out the dangers of tinkering with this economy with controls and microdigital computers when it is enormous and massive and requires the confidence and strength of the American people to have it run.

Mr. President, I yield the :floor. The PRESIDING OFFICER <Mr.

BoscHWITz). The Senator from Illinois. Mr. PERCY. Mr. President, I thank my

distinguished colleague for his comments on what happens under wage and price controls. He is correct to point out that in the end these controls are a great disservice to the American consumer. I would also like to thank my colleague for his eloquent comments on the economic recovery program.

Mr. President, I am very pleased at this time to yield to a distinguished Member of this body from a neighboring State. The people of Iowa and the people of Illinois are behind this program. They believe it will work. It is the only alternative we have.

I also particularly commend my distinguished colleague. Senator GRASSLEY. for h;ii strong suoport of estate tax reform which will eliminate 99 percent of all


American families from the payment of estate taxes. These reforms will permit estates to pass free o'f taxation to spouses. These reforms are particularly important to agriculture because no matter who holds the title, it is a family enterprise and business. A spouse puts in so much of her own. well-being and livelihood into that business that there should be this freedom from taxation. We have to preserve the family farm which is the underlying strength of the Illinois and Iowa economy.

I pay particular tribute to him for his devotion to this particular aspect of the tax bill and for also moving up the exclusion to $600,000 which is so important to embrace and hold to the principle of preserving the family farm.

I am happy to yield at this time to my distinguished colleague from Iowa.

Mr. GRASSLEY. Mr. President, I thank the Senator from Illinois for that recognition. As a freshman Member of this body, I appreciate all the help he has given me in becoming a contributing Member to the changes we have established.

It gives me great pleasure to participate in this celebration of the fiscal new year's eve, for tomorrow we will begin to see the results of our painstaking efforts of the last 7 months. Tomorrow will be the new beginning President Reagan promised us. Tomorrow the economic recovery program will indeed begin in earnest.

As we all know, we have worked many long days to set the crucial element of the economic plan into place. None of it has been easy, but due to the diligence of our leadership, the chairmen of all our committees, and the President himself, we have been successful in creating an economic environment in this country that should bring about the economic growth and productivity we so desperately need. As a member of both the Budget and Finance Committees, the Reagan anti-inflation plan has been my top priority, and though we have seen preliminary signs of its success-such as the decline in inflation to less than 10 percent-! look forward to seeing further signs of economic strength and recovery.

Over the past month or so, we have lost sight of our long-term goals, and have instead devoted ourselves to a heated debate as to who is to blame for the

· slow and painful economic recovery. We have managed to fault everyone and everything from Democrats to Republicans to Chairman Volcker to blue smoke and mirrors. Granted, interest rates are at all-time high levels. Our constituencies, whether they are businessmen or farmers, certainly feel the squeeze that these rates are putting on them. They scream, we cringe, and in our desperation we begin to look for quick cures. In fact, some have gone so far as to think in terms . of repealing part of the program we have worked so hard to achieve-the tax cuts-as well as jeopardizing our national security. Other instant miracles under review include credit controls and a return to the gold standard. This is neither the time nor place to debate the specifics of these issues, but suffice it to say that we have tried these cures

before, and they did not work. We know that there are no instant miracles for solving the economic crisis that has been 30 years in the making. We know that eomething truly substantive must be done to bring about our economic recovery. In the past 7 months, we have been setting into place the substantive changes we need in order to accomplish this. We have passed the omnibus reconciliation bill of 1981, which actually achieves savings of $133.9 billion by 1984. We have also passed the Economic Recovery Tax Act of 1981, which contains productivity oriented tax cuts that will provide more economic growth and more jobs to the private sector.

Our economic performance has also improved over that past few months, with inflation falling, unemployment declining, and real growth in GNP increasing.

In all our worry over high interest rates, we have managed to forget our accomplishments. Of course, we have not seen any results of the plan. Legitimately, even the President admits that the plan is not working. There is one other very important thing that we have also forgotten. These crucial tax and spending reductions do not even go into effect until fiscal year 1982 tomorrow.

All our accomplishments aside, I am willing to admit that there is more that we can do. The economic recovery plan is not a panacea for all our economic problems. It is only a part of the new beginning. We have more savings in the budget to achieve, more burdensome regulations to eliminate, and more of a tax burden to lift off the shoulders of the private sector. We are not finished yet, but we have made a great beginning. I, for one am looking forward to the fiscal new year.

Mr. PERCY. I thank my distinguished colleague, Senator GRASSLEY. As he has so aptly said, we begin tomorrow. Just take into account the people being cut off the executive payroll. We have already cut all committees in the Senate 10 percent. That took effect last January, but we had severance pay that we had to pay. The fiscal year begins tomorrow. Some of these personnel cutbacks will begin tomorrow and these workers will have separation pay.

But we have to be patient about those things. I think it is important to point that out.

Mr. GRASSLEY. Mr. President, if I could add one additional thing on the tax cuts, it is that the real impact of the tax cuts will not be realized until July 1 of next year.

Since we have had increases in social security taxes that were voted on in 1977 and bracket creep that has been a symptom for years, the real effect of the tax cut will be felt on July 1 of next year. So we should not expect too much of this program until that time comes. I am. however, looking forward to seeing an immediate improvement in the economy. particularly as the inflation psychology i3 defeated.

Mr. PERCY. I thank my distinguished colleague.

Mr. President, it is said Congress moves with glacier-like speed many, many times. But certainly in the eco-

nomic recovery program it has absolutely amazed the country that we have stood together, moved ,together with the President, acted as one to enact this program.

Right in the forefront in support of the economic recovery program has been my distinguished collegaue from New York, Senator D'AMATO. In addition he has t~e sensitivity and humanity to recognize that while we solve our problems at home we also have to look at the problems of other people.

He has been particularly interested in the problems in Poland. He has been sensitive to their needs, he has recognized that we have huge surpluses here that can and should be used to help the people of Poland.

Although he abhors the form of government they have been under, and he recognizes that that has been a contributing factor to the decline in productivity, the decline in that economy through the years, and the reasons why we now have this urgent problem in Poland he has recognized the fact that we can ~nd should do something about it, together with other nations to help these people in a time of urgent need.

I commend the distinguished Senator for coming to the Committee on Foreign Relations asking for urgent passage of a resolution, and I am happy to report that probably we have never acted more s~eedily than we have in this case. We w1ll report out today the D'Amato resolution of which I am pleased to be a cosponsor, and we will act on the floor of the Senate. We will ask the Senate for ~nani~ous consent to act immediately m th1s emergency situation. Congress and the Senate can act promptly when t~ey ~ee the need, and I thank my distmgmshed colleague for his sense of humanity, his sense of urgency not only ~ith respect to people abroad, whose destmy we are deeply concerned about but also his full backing and support fo~ the Reagan economic recovery program. I am happy to yield to him at this time.

Mr. D'AMATO. Mr. President I thank my distinguished colleague, the senior Senator from Illinois.

I think it would be remiss of me if I did not indicate the manner in which he carefully crafted those parts of the resolution in terms of bringing forth the deep sense of urgency that this body feels the Senate of the United States feels, for the people of Poland.

It is our sense and purpose that we aid ~nd as~ our President to aid these people m the1r flght for freedom and in their flght in certain cases for survival. . As we . know, malnutrition is on the mcrease m Poland, and were it not for t~e manne: in which Senator PERCY has g~ven of. h1mself and his entire staff to st~er th~s resolution through the com~Ittee, m probably one of the fastest kmd~ of thmgs, I think, within a matter of mmutes, we would not be able to act on this resolution today.

So ! t~ank my distinguished colleague for his aid and leadership.

I also join with him and many of my other colleagues today, Mr. President, because today is New Year's Eve. It is the eve of fiscal year 1 of the Reagan era.

September 3~, 1981 CONGRESSIONAL RECORD-SENATE 22481 Until tomorrow the Federal Government is, and has been, operating under the last Carter budget. The fiscal year that starts tomorrow, however, will be a very different yeal" than the one that has just ended. For this we can be thankful. Of this we can be proud.

I am pleased to h~ve been part of the process that guaranteed that next year will be different. President Reagan and the Congress have been very busy during these past 9 months preparing for the coming fiscal year. Together we have begun those steps that will restore the economic health of our Nation in the years to come.

In less than 9 months in office, President Reagan and this Congress have mandated a drastic change in the way the Federal Government conducts its business. We have mandated a reduced rate of growth in Federal spending. President Reagan has begun the process of eliminating the many unnecessary Government regulations. Together we have enacted the largest tax cut in American history-a tax cut that will allow American taxpayers to keep more of the hard-earned dollars that are rightfully theirs.

This is truly a joyous New Year's Eve. President Reagan and this Congress have prepared well for the coming fiscal year. With the budget and tax cuts in place and the easing in unnecessary Government regulations, we can expect inflation, unemployment and interest rates all to begin to ease during the coming fiscal year. President Reagan and this Congress have begun the process of balancing the budget while at the same time providing an economic climate where productivity will grow and the Nation's businesses will expand the available job opportunities.

President Reagan has rightly pled~ed to keep the Federal Government's deficit down as we begin once again moving toward what has almost become a forgotten phenomenon in American politics-that is, a balanced Federal budget. We in the Congress must continue to support these efforts if we are to continue to lower interest rates, if we are to make home mortgages affordable again, if we are to make it possible for businesses-especiallv small businesses-to once again finance respectable inventories.

In other words, it is necessary for President Reagan and this Congress to continue the work we have already begun. Our priorities will remain the same during this coming year as they have been during these past 9 months. However. it is appropriate on this New Year's Eve for us to stop and reflect on what we have done. It is also appropriate to do what all Americans do on New Year's Eve-that is, make resolutions for the coming year.

The most important resolution is clearly to make sure that we keep the Federal Government on the diet we have agreed to put it on. We must continue to restrain the growth in Federal spending. The President and this Congress must watch our budget as millions of Americans watch their diet. In fact, we must

do better than most. We cannot afford to go off our diets for brief spending sprees.

In the past the Government has orften demonstrated its addiction to continued spending once it has gone off its diet. Thus, we must watch our budget as others watch their waistline. We must count our appropriations as others count their calories. We must continue our relentless pursuit of a slimmer Federal Government.

Our second resolution must be to learn to keep our hands off the property of others. We must resist the temptation to raise taxes so high that we discourage productivity and investment. We must allow-in fact, we must encourage-the American taxpayer to save and invest for his or her own future, and for the future of the Nation's economy as a whole.

The third resolution for President Reagan and this Congress for the new year is to keep our lines of communication open. We must continue to work together as we have done during the past 9 months. All too often in the past Presidents have isolated themselves from the Congress and the people. The whole Nation suffers whenever this happens, thus, we must resolve not to let it happen again.

I am certain that we will be able to keep these resolutions. They require only that President Reagan and this Congress continue the work and practices we have already begun.

We have begun working toward a leaner Federal Government through budget cuts. We must continue to do so.

We have begun to respect more highly the property of the American taxpayer by enacting the largest tax cut in American history. We must .resist the temptation to reverse this process.

We have kept the channels of communication open between the White House and the Capitol. We must not let these open channels be broken as they unfortunately have been broken in the past.

We can keep these resolutions. We must keep these resolutions. We will keep these resolutions . . The new fiscal year that begins tomorrow will be a very good one for the United States.

Happy New Year. Mr. President. Tomorrow we begin the new year.

Mr. PERCY. I think it will be a better new year because of the work of my distinguished colleague. I am very grateful indeed for his comments and for his persistent work. He has been an admirable colleague to work with, and we are deeply grateful for his support and help.

Mr. President, I am very happy at .this time to yield to my distinguished colleague at this time, Senator JAMES ABDNOR of South Dakota. His work on the Appropriations Committee is obviously extremely important to this whole process. He can speak with a voice of great authority in an area that Wall Street is concerned about: Are we really serious about cutting the budget? Are we really going to follow throu~h? Is this budget process, which is obviollsly subject to amendment, merely a facade, or does the Appropriations Committee, which really

holds the pJwer, intend to stick with it and see that we do bring this budget deficit down?

Also, I commend him for his work on the Environment and Public Works Committee, a powerful committee-one of two powerful committees on which he serves.

I know for one, myself, as a general rule, Senators are against public works programs unless they are in their State, and then you are for everything and anything.

I am pleased that in past years I have brought to the attention of the Committee on Public Works a project in my own city which I originally supported. I learned later, however, that it was not a cost-effective project; namely the Oakley Dam in Decatur, TIL We stopped that project and we saved millions of dollars.

Now, in Chicago they are building the biggest tunnel in the world-136 miles long, 300 feet underground and $8.6 billion is the estimated cost of that project. It will be the biggest public works project in the history of the world-bigger than the Panama Canal.

I am raising questions, serious questions, as to whether this is cost effective, just as I am raising questions on the Tennessee Tombigbee Waterway, the waterway that parallels the Mississippi River. Is this cost-effective? GAO studies in both cases show it will never fulfill the promises of the Corps of Engineers.

So I commend my distinguished colleague for putting a tough, hard look on these projects that many, many times are the pork barrel projects that bankrupt the country. They literally do not have the cost-benefit ratio that has beer ~ projected for them by their particula" proponents.

I am happy to yield to my dis tin· . guished colleague at this time.

Mr. ABDNOR. Mr. President, I certainly thank my good friend, the distinguished Senator from Illinois, for those kind words. I serve on the Appropriations Committee and Public Works Committee and, like the other major committees of this Congress, it brings a great deal of responsibility.

Certainly, I say to my good friend who is the chairman of the Foreign Relations Committee, I know of no greater task than he has to bring this great country back to the great leadership role we have had in the world. He is doing a magnificent job in his committee and I commend him for it.

I never cease to be amazed, with that great responsibility, how he finds the time to work so diligently in other areas. We do have great appreciation for what he is doing in Dlinois to see that the needs that he has are legitimate, because the dollar is hard to find. We do know that when he speaks for his State's concerns, he does it with great sincerity and back~round and study.

I think it is a wonderful thing Senator PERCY is doing here today to carry on the discussion of this great program we are about to embark upon.

Mr. President, it is indeed a great privilege to join my colleagues today in dis-


cussing the significance of October 1, 1981, a historic day when this country embarks upon the new beginning of an awesome program to revitalize a nation's economy and bring about a new level of prosperity to all Americans.

A new beginning of productivity and prosperity is a welcome breath of fresh air after years of economic policies that have resulted in the crisis-like situation our economy was in when President Reagan and Vice President BusH took their oaths in January. It took many years to create the kinds of problems we are now attempting to solve.

We need to stop an inflation rate that , measured by the index of gross national product prices, has accelerated steadily since 1976 when it stood at 5.2 percent. It was no secret that inflation has been the No. 1 concern of AmeriCJans for many months, and it remains an overriding problem that must be dealt with.

Likewise, we need to correct interest rates that have risen, hand in hand, with the inflation rate. In fact, in 1980, the prime interest rate soared far above inflation levels and they remain disastrously high. We all know the depressing effects that high interest rates have on the economy. In particular, they have harmed two cornerstones of our economy, the farmer and the small businessman. The housing industry is being seriously damaged. As much as any other issue this Government must face, people across the country are telling us loud and clear they cannot live with interest rates at these current levels.

We have seen the havoc that interest rates can play in our efforts to bring the Federal budget into balance. Government indebtedness plays such a major role within the budget that high interest rates have created cost overruns necessitating further budget adjustments.

Recognizing these problems, the Reagan administration and a bipartisan coalition in both Houses of Congress have taken steps to begin invigorating our ailing economy. Tomorrow, we begin this administration's program that will increase productivity, output, employment, and fight inflation at the same time. This program calls for moderately tight, steady monetary policy and Federal spending restraint to fight inflation and, at the same time, tax cuts and reduced regulatory burdens to stimulate economic growth and employment.

Congress has made the commitment to spending and tax cuts, in particular, the tax cuts will stimulate incentives to work, save, and invest by affecting rates of return to capital and labor. This rate of return analysis is crucial. It means that tax rates can alter incentives in ways that are independent of the quantity of money directly involved in the tax change itself.

In demand-side economic analysis. it is the flow of funds in the spending stream that is imoortant. In supply-side economics, it is after-tax rates of return and their impact on incentives to work. save and invest that matters. To insure an increasing standard of living, we must be attentive to the economics of growth. Tax cuts of the right kind, and over an extended period, first lead to

changes in supplies of labor, and of capital plant and equipment, and then to output. Stepped-up output hits at both sides of our current stagflation problem-it increases economic growth and employment, and it helps fight inflation by putting more goods on the shelves.

Together, with regulatory reform and stable monetary growth, the other two elements of the President's economic recovery program, the restraints on spending and taxes will, in time, stop inflation and revitalize our faltering ec·onomy.

But, just as it took years for our current problems to evolve into their present magnitude, it will take time to bring about change. The two key watchwords are courage and patience. We have had the courage to start the program now, we must have the patience to endure the short-term hardships that may confront us on the road to long-term economic growth and prosperity.

I would say two things to those who have raised their voices against this program. One, Congress has already committed itself to the economic recovery plan. It is now national economic policy, and it would be foolhardy and counterproductive to abandon the program now because of minor problems and special interest pressures.

But, more importantly, the American people have stated unequivocally that they want lower inflation, much lower interest rates, increased abilities to save and invest, and increased gl"owth and employment. I would urge my colleagues to constantly remember the "silent majority" across the country that spoke through the ballot box last November and demanded the kinds of spending and taxing restraints that go into effect at midnight tonight.

I yield back the remainder of my time. Mr. PERCY. Mr. President, I thank my

distinguished colleague for his eloquent comments and for the dedication he has to this economic recovery program. The Senator from South Dakota certainly speaks wi·th a great deal of convir.tion and background knowledge. We thank him for the guidance he has provided to this program.

Mr. ABDNOR. I would like to say that the Senator from Illinois speaks for one of the largest States in the Nation and I speak for one of the smaller States, but we both have the same concerns.

Mr. PERCY. Mr. President, I am happy to yield to a Member from the largest State in the Un~on, one who has been a member of the Small Business Committee, a fighter for small business. My distinguished colleague from California, Senator HAYAKAWA, represents a State with the largest manufactured goods and exports of any State, certainly with the largest segment of our electronics industry. He also speaks on behalf of the small business people, so vitally affected by the events in this country, who are so adversely affected by the sluggishness of our economy.

The distinguished Senator has fought very hard for this economic rerovery program as the best hope that we have to begin this new fiscal year on the right foot.

I am happy to yield to my distinguished colleague.

The PRESIDING OFFICER. The Senator from California is recognized.

Mr. HA YAKA W A. I am grateful to the distinguished Senator from Illinois <Mr. PERCY > for his kind remarks. I would like to congratulate him, Senator D'AMATO, of New York, and Senator ABDNOR, of South Dakota, for introducing the theme that we have in common, mainly that this is New Year's Eve. Tomorrow, October 1, is the beginning of a new year. Indeed, it is the beginning of a new period in our history.

The Nation, under the leadership of our President, has been turned away from the disastrous policies of recent decades. The President has pushed through the largest tax cuts in our history, and launched us on a new path of fiscal responsibility and economic recovery. Therefore, Mr. President, I am pleased to join my distinguished colleagues this morning in presenting a view that is all too often overshadowed by the jitteriness of Wall Street and by the hysterics of the media.

The message I want to convey is that the President's program for economic recovery will work if America gives it a chance. The program does not even begin to go into effect until tomorrow.

Despite this fact, all kinds of moaning and groaning about economic doom we are confronting appears daily in the press.

All we have heard in recent weeks is that Reaganomics does not work, that the financial markets are worried, that inflation is still with us, and that interest rates are keeping businesses from functioning. And those who esoouse such pessimism forget that President Reagan has been in office just over 8 months. Congress has already enacted the largest budget reduction and tax cut bills in history with his guidance. Tomorrow is the first day of the new fiscal year. All the legislation which we have enacted to bring to the country economic recovery now goes into effect and I am optimistic that things are changing. I believe we must continue to pursue the same path that brought us the reforms already enacted.

For those who disagree, I have a few thoughts. I know that interest rates are too high. In fact, I hear about it every time I am in California and a lot of times when I am not in California.

I know that interest rates are killing off businesses which have provided valuable services to their communities for many years. Just the other day one businessman was crying in his beer saying, "I do not think I can last another year the way interest rates are at the present time." His companion, also crying into his beer, said, "I cannot last 6 months."

Those are the kinds of stories one keeps hearing. so the alarm is endemic.

However, just as strongly as I believe interest rates are having a devastating effect on businesses. I believe they are only a symptom of a far worse problem. The problem. of course, is inflation. Persistently high interest rates ruin businesses and even industries, but inflation ruins entire societies.

September 30, [981 CONGRESSIONAL RECORD-SENATE 22483 After World War I, Germany tried to

pay its debts by merely printing more money. The result was an inflation that drove the country to disaster.

Most Members know the story. Mothers would fill their knapsacks with Deutsche marks and with that they could only buy a half loaf of bread with their life savings. Soon no one cared about culture, society, freedom, even about life. Normal citizens became hedonists, finally eagerly susceptible to the rhetoric of fascism and the dehumanizing of an entire people. This is the kind of disaster that unbridled inflation can lead to.

I think it is incumbent upon us to prevent that kind of voracious inflation from destroying our American way of life. So while it may be expedient to want relief from the symptom, namely the high interest rates, I think we need to concentrate on the fundamental disease, which is infiati:m.

If we try to abate the tight money policy which is creating the atmosphere for high interest rates, we will sound our own death knell in the fight against inflation. Interest rates may fall for a short time, but when the resulting inflation begins its powerful upsurge, it will take interest rates higher than we have yet managed.

On the other hand, if we tackle the problem of inflation directly, interest rates will begin to drop down to a manageable level.

If we start with the definition of inflation as too much money or too many dollars chasing too few goods, it is apparent ihat attacking the problem can be done at either or both ends. That is, the number of dollars should be reduced and/or the number of goods must be increased.

The administration's economic policy pursues both of these goals by restricting the growth of the money supply and providing incentives for industries to increase their productivity.

Restricting monetary growth is absolutely essential to combating inflation. Without monetary discipline, the supply of money will increase beyond the increase in our productive capacity and inflation will contjnue. I am aware of the hardships tight money policy is creating for borrowers, but the resulting high interest rates reflect the closing margin between real growth and monetary growth. When capital is infused into the market from nonartificial sources-from reductions in taxesdemand for credit will ease and interest rates will fall. Both of these depend on the success of our attack on the other ~ide of the inflation equation, providing mcentives for productivity growth.

The tax bill that we recently passed is a crucial element of the program for economic recovery, and cannot be deferred or tied to deficit levels. For the first time in 50 years, there is an opportunity for Americans to catch up with Government spending by retaining some of their earnings. Both the personal tax rate reductions and the accelerated cost recovery system will create a pool of capital from which businesses may draw for growth of productivity. Without this

79-059 Q-85-21 (Pt. 17)

capital, there can be no expansion, and we will continue to experience unemployment and economic stagnation.

The other element of the President's program, which others have emphasized more than I, are the budget cuts necessary to keep our deficit from interfering in the credit market further than the Government already has. Federal spending has been encroaching on private investment in productive resources to the extent that capital is either not available to producers or it carries too expensive a price tag.

The times are changing, Mr. President. If we continue to fight inflation, and let the tax reduction encourage private investment and productivity growth, there will be an economic recovery. It is all beginning to happen now, as it goes into effect tomorrow.

Mr. President, I thank the Chair and I thank my distinguished colleague <Mr. PERCY) for this opportunity to speak.

Mr. PERCY. Mr. President, I thank my distinguished colleague for his support for this program.

Mr. President, at this time, I yield to my distinguished colleague, Senator MATTINGLY of Georgia. His services on the Government Affairs Committee, where we serve together, has been a source of great personal joy to me and also a source of admiration for the way he digs into his work.

He participated actively in working toward the selection of Comptroller General. GAO is one of the great agencies in the Government, the most cost-effective outside of IRS that I know of. Yesterday, when we overwhelmingly confirmed the new Comptroller General, we knew that we had made a wise selection for the next 15 years. Having oversight over GAO, having created the whole budget process on that committee, before the Senator's tenure on the committee and now having his full support, it is our job to see that this process really works and to back it up and support it. By his votes in the Senate time after time, he has shown his utter devotion to the principle of the budget process and now that we begin this fiscal year, we do so with hope, with promise, with expectations of the reversal of the disastrous trend we have been on. I am filled with admiration for and I commend my distinguished colleague for his great service so far to the U.S. Senate, the service that I know will continue for many years to come.

Mr. MATTINGLY. Mr. President, I thank my good friend from Dlinois for his remarks.

Mr. President, tomorrow we begin what we all hope will be a new era of prosperity for our country. As many of us traveled around our States last year campaigning, we learned how deeply the public wanted major changes in our Government. The thought often expressed to me was that if the change was not begun in 1980, it would never come about. We would be too far along the road to some sort of dreary socialism. The public was and is sick of politicians who have made a career of buying votes through Government giveaway programs. Too long have we operated on the principle that if you bestow enough

tax paid gifts on enough people, you will never have to worry at election time.

But the voters and the people of our country began to notice the tremendous increases in the deductions from their paychecks. They began to resent the money shuffle in Washington that constantly demanded· more and more of the money they had worked for. They voted for and swept into office people who are not afraid of saying "No," we cannot afford all these programs.

It is not always the most popular course of action, Mr. President. You cannot cut a bureaucrat's budget and expect him to like it. But we have to look down the road at the end result of what begins tomorrow.

Tomorrow, we begin to turn the tide we begin to rollback Government and get it out of the pocket of the average American. I feel confident that we are going to see the impact of both our budget and our tax cuts on the economy of this country. We are laboring now under problems created by years of fiscal foolishness. We cannot expect complete recoverv overnight, but tomorrow begins it.

This program of the economic recovery package begins on October 1. This new beginning is composed of the same elements for growth that started America initially on its historic rise to greatness through the past 205 years. 'rhe economic recovery package of President Reagan had its seeds planted by somebody here in our Chamber, Senator BILL RoTH, and Representative KEMP from the House side. Through the election of President Reagan last year, it has bloomed into a full economic recovery package of tax reform, budget reform, and regulatory reform.

The ship of state, which the public hears of and sees printed as really the direction of America, is changing its course and it is now changing its course in favor of the private citizen so he can create once again, so he can save money, so he can in vest money.

The course of state is also changing in favor of the unemployed in this country because they are going to be able to find jobs in the future with this new economic recovery package.

The economic recovery package, or this new beginning, is a creation program. It is going to create more jobs. It will create lower interest rates, it will create lower inflation rates, it will create hope and opportunity to people, it will create the demise of the poverty trap in our country.

It is going to create growth, as I said, and it is going to create stronger paychecks.

In fact, Mr. President, what the economic recovery package does is create a rising tide that is going to help all people in our country.

The creation program will happen because a new beginning will happen because a majority of the Nation's leaders that are in this body and on the House side now understand that the private sector and not the government sector is the real creator of prosperity in our country.

I thank the Chair. Mr. PERCY. Mr. President, I thank my

distinguished colleague, who also serves


on the powerful and crucial Appropriations Committee.

As I said earlier on the floor of the Senate we have a project in Tilinois, as the di~tinguished Senator from Mississippi (Mr. STENNIS) knows. It is the biggest public works project in the history of the world-the deep tunnel. We are digging a tunnel 300 or more feet below earth, 136 miles long, to take care of water pollution. If 55 other cities were to adopt the same principle to take care of pollution, it would cost this Government $600 billion. This is inconceivable.

I know it is unusual to talk about eliminating public works projects in one's own State. As I said before, we cut back an Illinois project, with the cooperation of the Appropriations Committee and the Public works Committee. The particular project was in Decatur, Til., for the construction of Oakley Dam, and it was not cost effective.

When I am critical of other projects around the country, I am also critical of our own projects in Illinois. I am working with the Appropriations Committee on this and other projects.

This is a powerful committee for the distinguished Senator to serve on, and it is a tremendous responsibility. Senator MATTINGLY takes his actions in accordance with a set of principles of fiscal responsibility. The principles he has adhered to in the economic recovery program are the best hope we have for the new beginning, beginning tomorrow.

I thank my colleague for his valuable service to the country and to the U.S. Senate.

Mr. MATTINGLY. I thank the Senator.

Mr. PERCY. Mr. President, I am pleased to yield to the distinguished chairman of the Committee on Labor and HuJnan Resources.

From this standpoint, it is important to note that that committee has controlled expenditures of a huge size. Its impact on the budget in past years has been a contributing factor to the huge deficits we have rolled up, which now have exceeded $1 trillion.

As a member of the Budget Committee, he is in the unique position not only to oversee the largest social programs in th3 country but also to see them in the perspective of the entire budget. He can see it from the standpoint of all the spending on small businesses, as a member of the Committee on Small Business.

So his perspective in the Senate is unique. With a sense of compassion, he has worked with the President to put the safety net under people who really need help and to move to reduce spending for some of these programs that may be desirable but nonessential. He has worked with skill toward the objective of bringing about an economic recovery program for the entire country.

I am very pleased to yield to my distir..guished colleague. I commend him on the work he has done in the various capacities he holds in the Senate.

Mr. HATCH. I thank the Senator from Illinois. I appreciate the kind remarks he has made.

Mr. President, I also appreciate being able to participate in this colloquy to-

day, in this process of being able to talk about a new beginning and what o'.ll' great President is trying to do.

Mr. President, for the past several months, the public has been saturated with the terms "supply-side economics" and "Reaganomics." Even before the President's economic programs have even gone into effect, his critics and political opponents have capitalized on high interest rates to conduct a barrage of negative media coverage designed · to stir public skepticism and create unwarranted public doubt. The President's opposition realizes that the key to the success of the President's program has been and will be his popuiarity and the public's confidence in him as a leader.

The media, eager to paint a worried Reagan face on the prospects for his economic program, managed to raise the level of public concern last week until the President's calm, confident manner assuaged those concerns to a large degree in a speech to the Nation last Thursday evening. A Gallop poll taken just before the President's speech revealed that his popuiarity had fallen 9 percentage points to a mere 51-percent approval rating. I am sure that percentage is up considerably, especially since the President assured the public that entitlements such as social security will remain unscathed by further cuts.

While the public is feeling more at ease since last Thursday's assurance that President Reagan is still in control, the financial markets will not lower interest rates until they can see that deficits will be held to a minimum in fiscal year 1982. The President's new budget proposals will achieve the deficit levels necessary to relieve the credit markets of the threat of additional government borrowing· activity. However, I am pleased that the interest rates have gone down slightly since the President's speech, and I hope they will go down further. I will do everything in my power to try to get them to go down, for the benefit of all Americans who are su1Iering from the economic calamities of the last 50 years-and, I might add, the economic excesses of the last 50 years. The financial markets, it seems to me, will continue to have some jitteriness until they see what we in Congress are willing to do.

If we had given the President everything he originally asked for, we would not be worried about the deficits keeping interest rates high. For instance, Congress refused to give the President rescissions and deferrals of fiscal year 1981 spending authority that have added $2.1 billion in planned outlays during the 1982-84 period. The last reconciliation bill fell $6.3 billion short of the President's proposals for fiscal year 1982, $9.8 billion short in fiscal year 1983, and $12 billion in fiscal year 1984. That amounts to $28 billion, not counting nearly $3 billion more that would have been saved in the entitlement programs. Another $19.6 billion could have been saved through 1984 if Congress had not delayed action on social security reforms aimed at curbing abuses.

Another $4.5 billion in savings couid

have been realized through the application of user charges. Instead, interest charges on the Federal debt have increased due to interest rates; spending estimat.es for entitlement programs such as food stamps, farm price supports and medicare are higher than the July estimates because Congress refuses to exercise much control in these areas; and appropriations bills threaten to increase outlays by several billion above the President's proposal. Because of all this, the President is seeking further cuts. Wall Street is not budging on interest rates because they know that an additional 12 percent cut in nondefense, nonentitlement programs will be tough for Congr~ss to f.onow. Tough though it may be, this President has been underestimated before and I, for one, would not bet against him. In fact, I think he will get most of what he asks for, because it is in the interest of the public as a whole to balance the need for Government so-. cial programs with good sound fiscal responsibility that will not bankrupt the entire Nation.

Many will remember how I used to complain about the budget process or, should I say, criticize the way the budget process was used to disguise the intentions and habits of the big social spenders who had controlled Congress for nearly half a century. If any one had told me when I came to Washington, or even last year at this time, that Congress would cut $50 billion in spending in fiscal years 1981 and 1982, I would have said, "You're crazy." President Reagan deserves all the credit because it would not have been possible without him. Helping to facilitate the President, of course, were Senator DoMENICI and some of our friends in the House, including a number of Democrats who had the courage to put their country's interests ahead of the dictates of their own party. They may be the real heroes, in addition to the President, in this overall battle that we have been fighting, which has not ended but still has some way to go.

I feel good about the budget cuts already enacted. If given the chance, the economy will respond. Unfortunately, suffering from high interest rates is so high that critics have been able to capitalize on it with negative media coverage to the degree th~t some people are beginning to associate the President's economic programs with high interest rates even though most of his programs will not go into effect until tomorrow.

It is important to realize that for 45 of the last 51 years, we failed to balance the budget in this country. I believe we have balanced it only once in the last 21 years; and in the last 10 years we have had a prolific growth in spending, second to none in the history of the world. Congress, in my mind, is the body responsible for what really has happened to us.

In addition to the President's new budget cuts he has proposed to reduce off-budget spending such as Federal loan guarantee commitments. Federally assisted credit is expected to absorb nearly half of the net new capital raised from domestic financial markets in 1981. If enacted, this, along with the budget


cuts, will give the financial markets every reason to lower the high rates on money without further delay.

Some Republicans and conservative Democrats who supported Reaganomics in the first round are threrutening to withdraw their support for further cuts unless the Presidents cuts more than the proposed cut of $2 billion out of defense spending. Considering how strongly the President feels aboUJt defense I do not think he will back down, but Congress will probably reduce defense spending a few billion dollars more anyway. To get his new proposals passed by Congress, the President might give in slightly on defense.

Barring any unforeseen upsurge in commodity prices as in recent years with food and fuel I believe we are going to experience a steady improvement in the economy. The Federal Reserve will need to be careful that money growth targets do not inhibit interest rates during strong economic growth. The increasing support to return to the gold standard should motivate the Fed not to be too restrictive. Assuming the pickup in the growth of the money supply and a continuing improved inflation picture, interest rates will begin to move downward a lilttle around the end of the year before leveling off again until the end of 1982. Of course, if the President's new proposals are successful to any degree, we can anticipate a much quicker improvement in the interest rate situation and the economy as a whole.

Before we are completely successful in getting Government spending under control sooner or later Members of Congress are going to have to join the President in an effort to modify entitlement programs. Twenty years ago, entitlements accounted for only one-fourth of the Federal budget; today they require 56 percent of the budget. Within the last 10 years, they have grown 2% times faster than the GNP. Congress is going to have to address the indexing issue and redefine recipient groups or the problem will only get bigger.

Last night we extended the debt limit ceiling to exceed the trillion dollar mark. Even if we pass the President's new proposals and hold to his deficit level of $42.5 billion in fiscal year 1982 the Federal debt outstanding will reach one trillion seventy six billion by the end of the year. In light of this fact alone, can we afford not to pass the President's new budget proposals? No; either we assume the burden now or pass it on to our children and the generations to follow.

It is my understanding that the distinguished Senator from Tilinois does have some questions for me that he may care to ask at this time.

The PRESIDING OFFICER <Mrs. KASSEBAUM). The Senator from Illinois.

Mr. PERCY. Madam President, I do, and I am pleased that also the distinguished chairman of the Finance Committee, Senator DoLE, is in the Chamber also, and there may be some questions to him.

While some of my colleagues are here, I wish to show a symbol of the new beginning that will be made available and given to each of my distinguished col-

leagues who have spoken this morning who are here. This sweat shirt has printed on the front, beneath a sun'burst, the phrase "A new beginning, October 1, 1981." It symbolizes the fact that we do not begin this program and this new era until tomorrow. on the back is printed "FY 82". This is a sweat shirt that can be used by my distinguished colleagues to stay in lean, tough, hard shape as they work out physically and as a rermnder that this is a lean, tough, hard budget year that we are going to work on. Every committee chairman and member has to be lean, tough, and hard. And I pay particular tribute to two of my distinguished colleagues who serve on the Budget Committee and to Senators DoMENICI and HOLLINGS who in a bipartisan spirit have appr.oached this program for the most part aiming in the direction that will bring great and considerable accomplishments.

I wish to ask my distinguished colleague about the deficit.

The President has said that this year, fiscal 1982, the Federal budget deficit would be $43 billion. We all recognize that that is too high. It is too high for the President. It is too high for the Congress.

But could the Senator from Utah tell us how that compares with the last few years? How much better are we doing with that trend, with that $43 billion deficit? As has been pointed out in the Chamber, it is the direction of the deficit that matters. It is not the fact we have not balanced it yet this fiscal year, that is so important. But what direction are we aimed in with that $43 billion figure?

Mr. HATCH. I think it is a definite improvement over what we had in the past. As I sat in the Budget Committee in 1980, in May 1980 we announced the first balanced budget in 20 years. That was touted in the media and all over the country as really a significant achievement. As we sat there we told our fellow members of the Budget Committee that that was at least $30 billion, that even that budget was at least $30 billion in deficit at that time.

By the end of the summer they realized that and we did not even go to the second concurrent resolution by September 15, which is required by law and by the end of the fiscal year 1980 literally the fiscal year 1981 budget or before Reagan came in and started to make the cuts, that budget had gone in deficit upward of $60 billion and in addition Congress in its infinite wisdom set up an off-budget spending program· which is not allowed to be included in the deficit total of the $60 billion and that included $23 billion more. so we were facing an $80, $85 billion deficit before President Reagan became the President.

Now as it is, the deficit for fiscal year 1981 will still be high, but we did cut some spending in 1981 and in 1982 we have cut $35 billion more and hopefully we will cut another $13 billion on top of that.

So it is a definite change in direction. It is a definite new beginning.

This President is really helping us to try and get Federal spending under control. That is something that cannot be

done overnight without wholesale difficulties in the country, and I think that the change in the new beginning that he has started is really efficacious in helping us get down to the point that maybe by 1984 or shortly thereafter we will in fact have a balanced budget which could never had occurred had we continued to do what we were doing on the Budget Committee in 1978, 1979, 1980, and 1981.

I personally pay tribute to both Senator DOMENICI and Senator HOLLINGS, as the chairman and ranking minority me~ber of the Budget Committee, for the change that they have been able to help effectuate and above all pay credit to the President who has been the inspiration and the motivating factor for that change.

· Mr. PERCY. Madam President, I wish to ask one other brief question of the distinguished Senator before I yield to the chairman of the Finance Committee, Senator DoLE.

Yesterday I had lunch with Paul Volcker, the chairman of the Federal Reserve Board. The distinguished Senator from Utah <Mr. HATCH) has mentioned the problem of tight money and high interest costs. The Federal Reserve Board's tight money policy is not new. We have been living under it now for almost 2 years.

Is it logical to think that the Fed is about to abandon monetary restraint unless they really see that we mean business? That puts a tremendous responsibility on us to follow through with the budgetary commitments that we have made.

Mr. HATCH. I think during the election year of 1980 there was a flood of money that came in during the summer of that election year. I think we are paying the price today for that loosening of the monetary supply.

But I think Mr. Volcker means business. I think he is saying that we have to put up with some of the pains now or we are going to have this alternating stagflation-inflation condition continue well on into the future, only both of them moving upward instead of offsetting each ether, with the hope for potential of tinkering with the economy and gradually getting them in some sort of static balance.

What is really happening is that we are seeing some increasing optimistic signs of what may occur if we continue to at least have a reasonable monetary policy in the Federal Reserve Board.

President Reagan is supporting Mr. Volcker to the degree that we must have a restriction in the overall monetary supply until we can get inflation down, interest rates down, and until we get this country on its feet again. Coupled with productivity oriented tax rate reductions and tax cuts we enacted in this Congress hopefully we will be able to have some stimulative effect in the private sector and this might pull us out of the mess.

If we add to the problem of tight money the problem of the trillion dollar deficit that we have just approved and the $108-$120 billion in interest that we are going to have to pay as taxpayers or at least we are going to have to borrow so the Federal Government can pay

224:86 CONGRESSIONAL RECORD-SENATE September 30, 1981

it and borrow from the available lendable capital markets in this country, over the next year just to pay the interest on the $1 trillion national debt, we can see that we have lots of pressures and it does, it seems to me, support the position that Mr. Volcker to the degree that he has to have a reasonably attractive and strong monetary policy in order to get inflation stabilized so that the interest rates can come down.

Inflation, by the way, has basically been stabilized except for 1 month this year, and I think a lot of that has occurred because of the hope that President Reagan will have a new beginning, that his program will help us to start a new beginning, and help to change the old profligate, big spending ways that all of us in Congress are so used to. and all of us have participated in as we have tried to serve the interests of our respective constituencie3, sometimes to the detriment of the overall constituency, our country, in both parties.

But I believe we are going to .!ee some changes in the monetary policy over the next year. I do believe Mr. Volcker means business in restricting it. I think the President means business about getting inflation down, and I think there are some other innovative ways to get interest rates down, such as the bill I put into the RECORD yesterday that recognizes there are $600 billion in ERISA funds, pension funds, in this ·country that are presently restricted bv regulations and by interpretations of law from being utilized for residential mortgage purposes or first mortgage purposes.

By allowing those funds to come into the residential mortgage market, we may be able to have mortgages at lower interest rates put a dent into the overall interest rates, allow people to purchase homes for the first time and, in the final analysis, maybe help in this monetary supply problem.

I appreciate having been invited to the floor by my friend from Illinois, and I appreciate his leadership in this area in pointing out how important it is to get behind the President, whether we are Democrats or Republicans. to really have this new beginning take off and get this country's big spending practices under control and, of course, in the end benefit all Americans and, perhaps, manv mi.llions throughout the Western World.

Mr. PERCY. I thank my distinguished colleague. I wish to commend him on the bill he did introduce yesterday. I am proud to be a cosponsor of it.

Years ago I began talking with the homebuilders of Illinois and others who are concerned about the state of our housing in this country. The best answer I could come up with was that we should make available for this investment in America and its stability in the future the huge resources available in pension funds.

I commend the distinguished Senator for taking the leadership now in actually introducing legislation. I will be pleased to work with him on that, and I can assure him of the solid support of all of those homebuilders in Illinois with whom I have been working, who are anxious to see this industry restored to

its vigor and dynamic growth that will be so important in the economic recovery of our country.

Before yielding to my distinguished colleague, Senator DoLE, I would like to note one thing. There has been tremendous interest created in whether or not the tax cuts he authored and managed on the floor of the Senate with such distinguished leadership and tremendous success will help the economy. It is important for us to note that the National Association of Manufacturers in a recent meeting of its 139 board members had put to them pertinent economic questions.

Alexander B. Trowbridge, NAM's president and a former Secretary of Commerce, a close friend of my own, a man whom I admire tremendously, spearheaded this effort. Of the businesses responding to the NAM poll, 97 percent saw a reduction in inflation in the next year to 16 months, and 85 percent said the President's program would lower interest rates.

So we have evidence here that the business leadership, the manufacturing sector of American industry, has confidence that this program will work, and also NAM has called upon U.S. business to live up to its "obligation to increase plant and equipment investment in response to the tax incentive in President Reagan's economic program."

The PRESIDING OFFICER. If the Senator from Illinois will yield, all of his time has expired.

Mr. CHILES. I yield 1 minute to the distinguished Senator from Kansas.

Mr. PERCY. I very much appreciate the Senator's yielding.

Mr. DOLE. Madam President, I will just take a minute to indicate, first of all, that this is the last day of fiscal year 1981. Tomorrow starts a new day, another beginning. This is sort of the last of fiscal year 1981, and starting tomorrow it is going to be President Reagan's budget and concern.

I want to commend the distinguished Senator from Illinois and others who have participated this morning because we are now on the eve of the beginning of President Reagan's economic policy and his new tax policy.

This Senator believes it will work, this Senator believes it will, as indicated by the distinguished Senator from Illinois in reciting what the NAM has indicated, bring down interest rates and bring down inflation.

But I would also say that business has a responsibility, too. They have come to us and we have made certain changes in the tax system, and now they have a responsibility. I discuss that in greater detail in my statement, along with other matters that I think would indicate that the program is ready to go. It may not be perfect. It is a new direction. It is long overdue, and I applaud the President for his leadership.

Madam President, today is the last day of fiscal year 1981. That means it is the last day on which the Government is operating under a budget largely planned and designed by the Carter administration.

Tomorrow, October 1, 1981, marks

both the first day of fiscal year 1982 and the day on which mos't provisions of the Reagan administration economic recovery program first take legal effect. This will ·be the first budget to bear the stamp of the Reagan proposals on taxing and spending that were adopted by Congress this summer.

Madam President, last night the Senate approved a debt ceiling increase that for the first time wiU allow the Federal debt to rise over a trillion dollars, to $1,079.8 billion by September 30, 1982. This increase is regrettable, and is even more regrettable that ft should occur in the first full fiscal year under the Reagan administration.

But we should put the matter in perspective. As the Treasury Department advised us, a ·ceiling of $999.8 billionjust a fraction under a trillion-was required to cover through September 30, 1981.

In other words, it is the last fiscal year planned under the Carter administration-not the first year of the Reagan administration-that brought us to the brink of a trillion dollar debt. We hope to do better than that in the future, and I expect that we will.

Madam President, this is an important daJte to note. Despite all the rhetoric and the extensive commentary in the press in recent weeks, the economic program has not even begun to have a chance to have its impact felt. Those who have tried to prejudge the prospects of the economic recovery program should take this 'OCCasion to pause and reconsider their judgment.

We have as yet no basis on which to judge the new program-that is, no basis other than our own common sense and the clearly-expressed sentiments of the American people. Those are the factors I believe, that led Congress to approv~ the tax and spending cuts by an overwhelming margin this summer. Those are also the considerations that augur well for the success of the program.

In the coming months we will begin to see the impact of the economic recovery program. We hope to see an impact on the budget, on interest rates, on inflation and on the economic decisions made every day by businesses and indivictuals. It is vitally important that progress be made in each of those areas. But we cannot forget that this program represents the first effort by the Rea~an administration to change the direction of our tax and fiscal policies, in the interest of reviving the economy. The old policies have been with us for decades.

Their impact will not disappear overnight. We should not expect sudden improvements, but we do believe there will be steady improvement in the economy over the next few years.

Madam President, the keys to the success of any economic program-particularly one which at·tempts to correct years of fiscal mismanagement-are coherence, consistency, and clarity. The President has given us a program the people understand. It is also a program that encompasses all aspects of our economic problems, and which sets consistent goals for the budget, for taxes, for monetary policy, and for Government regulation.

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22487 It is a program that continues to merit knowledge what has already been

our support, and that will require deter- ar.hieved. Tomorrow we begin a new mination on the part of both the admin- course, which we hope and expect will istration and the Congress if we are to succeed. get the economic results we all hope for: Mr. PERCY. I thank my distinguished Lower inflation, lower interest rates, colleague very much. I again commend more jobs, and increasing productivity. him for the tremendous leadership he

The Economic Recovery Tax Act of has displayed. It is an inspiration to us 1981 is a crucial cornerstone of the Rea- and it will be an inspiration to the coungan economic program. The tax cut that try when we see this program unfold. we approved in July reduces the tax I would like now to yield to my good burden by a total of about $750 billion colleague from Minnesota, Senator between now and 1986. Taxes will still BoscHWITZ, who is a member of the allrise over that period, partly because of important Budget Committee. I cominflation and partly because of economic mend him for his hard work this year in growth. bringing these landmark budget cuts to

But because of the tax bill, the share the floor. We will save $35 billion this of our national wealth taken by taxes year because of his committee's diligence. will not grow: It should decline from The Senator from Minnesota, who also present levels, which are exceptionally sits on the Agriculture and Small Busihigh even by the standards of the past ness Committees, knows that this protwo decades. This tax cut, while the larg- gram will help the economy like no other. est in history, is not all that large in It all starts tomorrow and will reverse fact. the economic slide we have been in for

That is because of the automatic tax some time. I yield to my distinguished increase built into our system, which we colleague. hope will be eradicated by the bill the Mr. BOSCHWITZ. Madam President, President signed on August 13. This tax the fact that Senate Republicans are cut is carefully designed to restore incen- taking to the floor and proclaiming Octives and remove roadblocks in the tax tober 1 as New Year's Day should not code to new investment, to greater pro- surprise anyone. After all, Congress has ductivity, and to stable economic growth. traditionally been out-of-step with the It is not a revenue giveaway: It is just a real world for years, and just because measure of equity to the taxpayer, and New Year's Day to everyone else is Janan effort to liberate the latent resources uary 1 does not stop the Government of our working people and our business from proclaiming that the new fiscal year community. rightfully begins on October 1.

Madam President, the Budget Recon- But what is surprising is that this year, ciliation Act also represents a ma.ior for the first time, Congress has made and turning point for this Congress and this kept a New Year's resolution. We are country. Under that legislation we have going to give up our bad habits andreagreed to reduce Federal spending by place them with good habits. We are about $35 billion in fiscal year 1982. going to stop spending money without

Those savings, carried out into future worrying where it comes from and we years, will add up to nearly $131 billion are going to stop taxing people as if they by 1984. Of the savings made in 1982, had unlimited income. nearly $10 billion came in programs un- I think this is truly a historic occasion, der the jurisdiction of the Finance Com- because for once and for all the talk mittee. I am pleased that the committee about budget and tax relief has been was able to make such a substantial con- translated from rhetoric to reality. tribution to the reconciliation effort. Since I have been here in the Senate

We know that more must be done, and I have heard a lot of talk about the we look forward to working on a bi- budget, but not much action until now. partisan basis to bring the Federal When I arrived in Washington, my budget under better control. But what first votes in the spring of 1979 were on we have done so far is a landmark the 1980 budget of $532 billion. Two years achievement, and its significance should later, just before he left; Jimmy Carter not be underestimated. submitted the 1982 budget. It was $739

Now this program will be put to the billion. That is a $207 billion increase in test beginning tomorrow. I believe the 2 years. That is growth. effort will succeed, because it recognizes What we have now done is to pare the how economic incentives work, and how fiscal year 1982 budget down through the excessive Government intervention has reconciliation process. And from here on prevented our ecqnomy from realizing its in we are going to have to prove we can potential. But this program is more like- stick with this. It will mean more budget ly to succeed if we have the will to fol- cuts and some hard political choices low through, and to exercise continued between programs. But I am going to vigilance over Federal spending. That is hang in there with the President, and I what the President has asked us to do, think my colleagues in the end run will and that .has all along been a key part also. of the economic recovery program. But to merely bend down the growth . Th~ ~resident has had great success line of Government spending and leave m brmgmg the country and the Congress it at that would be self-defeating in the arou!ld i~ their attitudes toward eco- long run. Along with spending modernomic policy. As the new program begins - ations, and that is what most of them to take effect throughout the country, are-very few programs are actually bewe should remember the hard work and ing eliminated is another side of the dif?cult decisions that have broug.ht us coin * * * tax p~licy. There what we have this fa!· '!here is much yet to be done, done is to provide an alternative to Govbut this Is an appropriate time to ac- ernment dependency for business, indi-

viduals, and organizations by promoting a better climate for job creation and some real increases in income. Our society must primarily grow through the prlvate sector, not Government.

I hope that as we move into the new year, that we keep in perspective the monumental nature of the task before us. We should not be impatient if we do not see tangible results by October 2, and we cannot just sit back and do nothing further. We have to give the program beginning tomorrow some time to take hold. We also must take further action as it becomes necessary to reinforce the program in the months and years to come.

Mr. PERCY. Mr. President, I thank the Senator from Minnesota for his excellent remarks. I see that the chairman of the Budget Committee is in the Chamber and I will yield to him for his remarks.

First, though, I would like to congratulate him for his enormous contribution to enacting this program. Without his steady hand on the wheel, we might not have achieved the savings we did. The Sentator from New Mexico has been tough and persistent and I know the whole country owes him their gratitude for breathing life into this economic recovery program.

I yield to my distinguished colleague. Mr. DOMENICI. Madam President, to

morrow begins the 1982 fiscal year. It is a year the President and this Congress have spent extraordinary amounts of time and energy preparing for over the last year. It is a year we look forward to with great expectations. The economic program of budget trimming and tax reduction is as bold and aggressive an attack of this country's economic initiative as has been seen in 50 years. We should now begin to see the consequences of those policies-reduced inflationary pressures, increased productivity, more competitive world and domestic trade, and renewed confidence in our economic program.

The President called his program a bold new beginning. And it was bold$34.8 billion of fiscal year 1982 outlay savings, credit restraint, off-budget outlay reductions, and the largest income tax reduction in this Nation's history$51.3 billion in fiscal year 1982. In a historic wave of support the Congress has acted quickly on the President's program. In August the President signed into law a package of legislative changes enabling a reduction in budget outlays for 1982 totaling $37.1 billion. In the same month the President signed into law tax cuts affecting both individuals and businesses totaling $51.1 billion for fiscal year 1982.

We all know how difficult the debate ~as been-and we all know that many Important and difficult decisions lie ahead. But tomorrow the bold new beginning moves from the legislator's docket to the taxpayer's pocket. The rate of growth of Government begins to subside and each taxpayer will begin to feel the impact of reduced tax burdens. It is a new fiscal year and, hopefully, a new fiscal era.

Before the Congress faced up to the mounting economic burdens facing the country the Congressional Budget Office


projected a 1982 deficit of $37.5 billionand tax revenue as a proportion of GNP totaling 23.4 percent. Automatic spending through legislative entitlements has increased deficit expectations for 1982 by about $30 billion but, because of the actions of this Congress it is about $37 billion less than it would have been otherwise.

Furthermore, the reduction in marginal tax rates has reduced the proportion of revenues to GNP to about 20 percent and outyear tax reductions will continue to chisel away at that burden so that revenues equal only about 18 percent of GNP by 1984.

Of course, there is still a great deal to do before we can reach the President's goal of a balanced budget by 1984. The task becomes more difficult; 63 percent of the $700 billion of outlays in fiscal year 1982 are determined by actions of prior Congresses and 57 percent are of the so-called entitlement variety. The path ahead is at least as difficult as the actions that are now behind us. But the point is, Madam President, that the President's economic program is off to a great beginning and tomorrow is the first day that the program will leave the world of expectations and enter reality.

We have all heard that Wall Street is jittery and that its reaction has been less than enthusiastic. I think I know why, and my suspicions were generally confirmed by witnesses only yesterday before the Budget Committee.

First, the effect of our actions will begin tomorrow but will take some time to play out their full impact. It will take time for credit markets to ease, consumers to gain confidence, international markets to adjust, and for monetary policy to safely become less restrictive.

Second, despite a sincere and expressed desire by the President and Congress. and despite the most monumental spending reduction in ·leg~slative history, there is still some doubt that our Government has any control over Federal spending.

Madam President, what our actions over the past few months have shown and must continue to show is a process for fiscal responsibility and control. We can assure Wall Street and the entire American public that there is a greater chance today than in the last 30 years to control Federal spending because of the resolve of this administration, public support and congressional processes.

We are indeed off to a great beginning and tomorrow marks the first year of this bold new program of economic progress.

Mr. LAXALT. Madam President, tomorrow our Nation will begin to shift direction and will start to head into the waters of a new economic prosperity. Although we have a long way to go to reverse the trends of the last several decades, we have taken the first crucial steps. I am confident of our eventual success. I look forward to the beginning of the new fiscal year when the Reagan budget goes into effect.

That budget will have several changes from the current fiscal year's bud~Z"et which was developed and enacted by the last administration. The first of those

changes is a reversal of the trend of simply throwing money at our domestic problems with the hope that some of it w1ll end up in the right place.

Instead, the social programs have been fine-tuned in order to eliminate unnecessary expenditures while protecting those truly in need. The Reagan budget is not hostile to social programs. Indeed, there are substantial increases in the dollars spent for social programs.

But by slowing the rate of growth of those programs the remaining dollars will be channeled into the most efficient programs and directed to those most in need. Rather than more social programs we will have better social programs.

A second feature of the first Reagan tudget is a reversal of the long decline of our military strength. A vital function of any government is to protect its citizens from invasion by hostile powers. The United States has an even bigger role to play in the world as the leader of free men and women wherever they are.

This is a responsibility that we must be willing to undertake despite the sacrifices it will demand. We must keep the world at peace. But that peace cannot be achieved with words or gestures. It can be achieved only through the strength of our military resources and the resolve to use those resources if needed.

Our military budget has suffered a steady decline over the last decade even as the world has become more hostile to the interests of the United States. It will take several years of increased spending to fully restore our military needs. But I am confident that once this takes place we will find a safer world at peace.

A third feature of the fiscal year 1982 budget is the reduction o.f taxes. On October 1, the first individual income tax reductions will take effect. These tax cuts will give the economy a needed boost. It will give the overburdened American taxpayer desperately needed relief.

Along with the subsequent individual tax cuts and the business tax reductions, this action will revitalize our private sector and strengthen our economy. Governments never create wealth; they absorb it or redistribute it. Only the private sector creates wealth and with a strong private sector there will be more for every American to share.

This, Madam President, is what the new fiscal year represents-a reduction in the growth of Government spending, social programs geared to those in need but trimmed of waste, a stronger defense, tax relief, and a revitalized private economy. Much remains to be done. But we have accomplished more in a shorter time than I ever imagined or hoped for.

Under the leadership of President Reagan we have made great strides toward getting our economy back on track. Tomorrow is truly a new year, a new beginning and the start of a new, brighter future.

Mr. GOLDWATER. Madam President, we are meeting on the last day of the last fiscal year of the administration of former President Carter, and it is sad that

our final act was to raise the debt ceiling. The good news is that the er~ of giant government is finally ending and we are about to return to free enterprise and the profit motive as the driving forces of this economy.

I make no apologies for extolling the virtues of free enterprise and profits. It is the opportunity to earn and prosper in proportion to one's hard work and creativity which motivates men and women.

Working men and women want to decide for themselves how to spend their own money, and they expect to earn a wage that will not disappear with inflation. When that right is denied, the incentive to work and earn is destroyed.

The new fiscal year acknowledges that private markets can allocate goods and services better than Government bureaucrats. It inaugurates a new approach to governing, in which less Government spending and less Government regulation mean more private incentives and more personal freedom.

Past Congresses and administrations have permitted Federal spending to climb until nearly one-fourth of all spending on new goods and services is being done by the Federal Government.

Taxes increased with the budget and inflation, but revenues were never high enough to pay the bills, and so we find ourselves with a debt ceiling of over $1 trillion. One trillion dollar bills, laid end to end, would reach the Sun.

And what did the policies of the past buy? They resulted only in an endless stream of wasteful and duplicative Government programs. They gave us interest payments on the Government debt which total almost 13 percent of the GNP; nearly $100 billion.

In response to the oppressive and selfdefeating policies of the big spenders and big taxers, the American people spoke out clearly last November: "This slide to economic disaster must be stopped and reversed." To date, the Reagan administration and the Congress have taken unprecedented steps to carry out that mandate.

We have enacted the largest spending cuts in history and we will enact more cuts on top of the earlier ones. We have passed the largest tax cuts in history to encourage capital investment and reward work effort. The administration has eliminated regulations and paperwork saving private citizens and businesses $13 billion and more relief is on the way.

Madam President, I will stand behind my President in his efforts to beat inflation, bring interest :rates down, create new jobs, and revive the Economy. His program will succeed in reaching these goals because the American people will make it work. I have received numerous telegrams and messages applauding President Reagan's determination and the correctiveness of his policies.

For every letter crying about the possible loss of this or that special privilege, I can show you manv more from ordinary citizens who unselfishly ask that their favorite program share in budget reductions so that all the people can enjoy the ultimate fruits of economic recovery. This spirit of cooperation by the overwhelming majority of the American peo-

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22489 ple tells me that the President's program will succeed.

Mr. PERCY. Mr. President, I would like to yield now to my distinguished colleague and seat mate, Senator THURMOND. No one has labored longer for fiscal discipline than the Senator from South Carolina. He has been a great strength in bringing this economic recovery program to fruition and I am pleased to see him here today.

I yield to my distinguished colleague, the President pro tempore of the Senate.

A NEW BEGINNING

Mr. THURMOND. Madam President, I am pleased to participate in this colloquy today on the eve of the effective date for the recently enacted tax and spending cut legislation.

In recent days, harsh criticism has been voiced by some about a Reagan economic recovery program that, so the skeptics say, "is not working." Madam President, that negative verdict is, to say the least, premature, inasmuch as the budget reductions and the tax bill do not begin to take effect until tomorrow.

Furthermore, after decades of fiscal mismanagement by "big spenders" in Congress and by several previous Chief Executives, it will take time to restore an economy ravaged by inflation and sagging productivity to a healthy, vibrant condition.

I am confident, however, that President Reagan, with the support of a working majority in Congress, has made a "new beginning" that puts our Nation on the road to economic recovery.

President Reagan was brought into office by a rising tide of frustrated voters who had had enough of repeated, huge Federal deficits, an increasingly heavy tax burden, double-digit inflation, and a dangerous trend toward ever more Federal Governm-ent intrusion into their daily lives.

Instead of another Government "prescription," the American people have said that they want a greater measure of control over their own lives. They neither want nor expect the Federal Government to solve all their problems, and they are tired of footing the bill for more and more Government programs that do not work. As President Reagan has said, the American people have come to see Government not as the solution to their problems, but as the problem.

Against this background of disillusionment, the new beginning of the Reagan administration offers the first real hope for a dramatic, meaningful change.

After less than two-thirds of its first year in office, this administration, led by a bold, courageous, and persuasive President, has in place the major planks of its economic recovery plan.

Starting tomorrow, taxpayers will begin to receive benefits from the first installment in the 3-year, substantial reduction in their individual tax burdens.

Starting tomorrow, American workers get to keep and use, as they think best, a little more of their hard-earned money, instead of having to send it to Washington to be spent as the Government dictates.

Moreover, this is just the beginning· it is only the first installment in a 3-ye'g,r,

$750 billion program of real tax relief for individuals and businesses.

Madam President, tomorrow marks the first step in a plan that will keep more money in the economy where it can be used for productive, job-creating investments and growth.

October 1 is not only the effective date fer the tax cut legislation, it is, of course, the beginning of a new fiscal year for the Federal Government, and the day on which the recently enacted package of budget reductions take effect. This monumental budget-cutting package slashe3 Federal outlays by over $35 billion in the new fiscal year, to be followed by reductions of $44 billion in fiscal year 1933 and $51 billion in fiscal year 1984.

These already-approved cuts represent a dramatic change in previous Federal spending habits, Madam President, but we must go further if we are to achieve a balanced budget by 1984. The goal of a balanced Federal budget is not just an arbitrary target; it is an objective that must be met as soon as practicable if we are to be successful in controlling inflation and interest rates.

Toward that end, President Reagan has recently asked the Congress and the American people to help him reduce the fiscal year 1982 deficit by another $16 billion, with further cuts to be made in the following 2 years.

Madam Presi1ent, I commend President Reagan and his administration for what has certainly been an outstanding effort to properl;v re-order our national priorities and bring about a strong economic recovery. I hope Congress will exercise the wisdom and political courage to make these necessaTy, further reductions in Federal spending on lower priority domestic programs. Only if we continue to take strong measures to curb Government spending will the tax cut prove meaningful and the economic r~covery program prove successful.

Having worked throughout my year3 in the Senate to restrain big government and preserve a strong national defense capability, I am indeed gratified by the progress made thus far by the Reagan administration and by the objectives which the President has put before us.

On this eve of the new beginning, I congratulate President Reagan on the achievements he and his administration have thus far accomplished.

We have made substantial progress toward restoring to the American people a greater measure of control over their national Government and over their own destinies.

This is a direction in which we must continue to move in the days ahead, and I shall certainly do all that I can to make the promises of a healthy economy and greater individual freedom realities for all our citizens.

Mr. ARMSTRONG. Madam President, it would seem, from comments in the press and on the floor of the Senate that Washington sees the future through a rearview mirror. Some Americans look back over the past 4 year J and, seeing a history of economic stagnation and intolerable inflation, expect the same for tomorrow. During this period, the opti-

mism and eagerness for a challenge that is so typically American had been replaced by a deadly cynicism and fear of the future.

I suggest, my distinguished colleagues, that some Members' recent actions and statements are attempts to return us to those "dark ages." I believe it is time for us to provide the calm leadership that the country needs. President Reagan's economic recovery plan is a bold one-it represents a profound change in the way the Government operates. And where there is bold change, there are doubts, fears, and uncertainties. I believe it is our task in this colloquy to address these doubts and reset our course.

Every day over the last month, we have read newspaper articles about the dismal state of the economy and the failure of Reaganomics. We have heard that the barons of Wall Street and the little guys on Main Street have rejected the President's program. Given the performance of the Redskins and the new TV season, these articles have added some excitement to our lives. But what are the facts?

In testimony before the Senate Budget Committee yesterday, representatives of Wall Street expressed their views. One had surveyed a number of major firms Merrill Lynch, Morgan Stanley, Gold: man Sachs, and so forth and found all in favor of the President's plans. All eight were unanimous on these points:

First. Keep cutting the Federal Government budget, with perticular emphasis on 1983 and later years.

Second. Encourage the Federal Reserve to maintain money growth on a low money path.

Third. Be patient and give the program a chance to work.

The central point made was quite clear: The President is cutting taxes the size and role of Government and contr~lling the money supply. No'thing less Wlll break a 20-year habit of rising inflation and slowing productivity.

From Main Street, we hear similar comments. Mail from the voters of Colorado has been running 20 to 1 in favor of the President's new cuts. The following letter is typical:

My business is being hurt by cutbacks but in the long-term interest of the country, I support the President.

It is these type of positive and patriotic responses to the economic recovery program that too many in Congress and the press have not heard. There has also been a deaf ear turned to the strengths of our economy and the progress we have made.

Our most dramatic success has been in the fight against inflation. The annual rate of inflation, as measured by the CPI, for the first two quarters of 1981 as compared to a like period in 1980 has fallen from 13.6 to 8.4 percent. A drop of 40 percent. The dangers of inflation to a democratic society and the tragic costs to our people have been well-chronicled. A year ago everyone-Democrat and Republican alike-agreed that inflation was our No.1 enemy.

Now that progress is being made, inflation is not even on the most wanted list. Our fight against inflation is sue-


ceeding and we should let the country know about it.

Unemployment in July was at 7 percent-less than the 7.6 percent of a year ago. This translates into 2 million new jobs.

The dollar is strong. With the incorrect yet constant emphasis on Wall Street's dissatisfaction, the "votes" of foreign financial markets have been ignored. Overseas investors are telling us that they have confidence in the President's plan and in the future of the United States.

U.S. energy conservation has exceeded expectations and lessened the power of OPEC. This is in part due to the freeing of markets from controls. As we begin part three of the President's programderegulation-we should look to the historical record. Removal of price controls and market regulations will fight inftation and increase efficiency.

Interest rates are beginning to decline and will continue to do so if we stay on the course set by the President. The history of financial markets teaches us one thing: Bond and stock prices decline and fluctuate wildly with economic or political instability and improve with stability.

President Reagan has provided us with a program for future stability-recent

·press and congressional hysteria has caused the opposite. The interest rates we have recently seen are the price we must pay for a generation of deficit spending.

It is ironic that those responsible for the large deficits and current high interest rates have been so successful in claiming it is our fault. Deficits rob the future to pay for the present.

We must not steal from our children's future to obtain a temporary drop of a few points in the prime rate. We deserve the contempt of history if we do so.

The single most important progress we have made is in defining the proper balance between the Government and the governed. Over the past generation, Washington has encouraged the view, in word and in legislation that more government is better government. The American people aTe ingenious, hard working, and looldng for a better life. Their Government should provide them the setting and the environment for them to achieve their dreams. But what do we see? We see a government whose programs offer cash rewards for self-destruction. The results are all around us: Good workers leave or never hold jobs, families are broken apart to receive aid, farmers leave good cropland fallow, and selfrespect is traded for a Government handout. Yet we are accused of a lack of humanity by those whose self-righteous policies have meant 40 percent black teenage unemployment year in and year out, inner city landscapes like those of World War II, Europe, and generations o:!' people deprived of dignity and purpose. We have just begun our fight to find ways for Government to give a hand, not a handout. For after all, it is people who create wealth and economic growth, not government.

In the midst of all the second-guessing and doubts, we owe our country leadership. Leadership does not mean that we

change our course with every jump in the prime rate, the Dow Jones averages, or the most recent Harris poll. It does mean that we recognize our Nation's choice of future promise over present satisfaction, and act accordingly. We must find at least the $75 billion in spending reductions that we voted for last spring in the first concurrent resolution.

We must stay the course in controlling monetary growth and begin our work on dismantling a generation of governmental regulations. We strike, then, the proper balance between revenues and outlays, the Government and the individual, and the present and the future.

Mr. McCLURE. Madam President, a number of my colleagues and I are engaging today in a colloquy calling attention to the new beginning of the new fiscal year on October 1. I suspect some people aronnd here have noticed the logo on the pins and lapels and signs that have been worn by a numbeT of Members.

The Sun depicted on the logo "a new beginning" is taken from the back of George Washington's chair which he used at the Constitutional Convention. Near the end of the convention, on September 17, 1797, Ben Franklin observed,

Now at length I know it is a rising and not a setting sun.

The symbolism is, of course, that we are witnessing not a setting sun, but a rising sun. The dawn begins tomorrow with the beginning of this new economic order.

Madam President, I would like to bring to the attention of my colleagues several essays concerning our economic recovery package. While I have some differences with some of these opinions I do agree with the major thrust of them.

In one of the articles liberal columnist David Broder writes that the package is a "long-term policy not a quick-fix expedient." He continues:

This policy wa.s approved by majorities less than two months ago. It has not yet been put in place. To consider scrubbing it nowor replacing it with an invisible alternativestrikes me, not a.s a sensible political judgment, but a reaction of pure panic.

October 1 marks the start of a beginning we orchestrated months ago, a start with indisputable direction and long term prospects of economic reemergence. The current economic crisis demands something more substantial than the superficial effort to provide a psychological symbol of fiscal restraint. It demands the package prescribed for recovery that we gave it. Now finally, on Thursday, it will go into effect. In recent weeks some economic indicators were showing strong surpport of this program. Inftation has steadily decreased since March, as have unemployment figures. Recent figures have also shown that interest rates have started a downward trend.

The goal we have set will not be easy, but it can be accomplished. On Thursday the American people will begin to receive benefits they were entitled to years ago. I ask unanimous consent that the articles be printed in the REcORD.

There being no objection, the articles

were ordered to be printed in the REcoan as follows:

[From the Statesman, Sept. 23, 1981) DoN'T JUNK REAGAN PROGRAMS BEFORE THEY

BEGIN' (By David Broder)

WASHINGTON.-It is plain now that the opposition to President Reagan and his program is beginning to find its voice. The 260,000 people who assembled on the Mall last Saturaay at the call of the AFL-CIO and some 200 other organizations to protest the Reagan economic policies was the largest such demonstration since Vietnam War days.

This weekend, the Democratic Party will hold its first major training session for the 1982 campaign in Des Moines, Iowa, and, on Oct. 1, it will parade a number of mayors before the microphones at a dinner in Washington to describe the damage they say will be done by the Reagan budget cuts that go into effect that day.

Meantime, House Democrats have recalled that the committees they control are allowed to conduct investigations, and Tip O'Neill has launched a number of them into regional hearings focused on the effects of high interest rates and scarce federal dollars.

As a result of all this, the Republicans are getting shaky about their support of the new round of budget cuts. And Washington, a city whose inbred discussions produce violent swings of opinion, has-in its typical fashion-gone from thinking that Reagan is king of the world to thinking he is a political fall guy.

What everyone needs to do is step back one pace and take a deep breath. Otherwise, we are about to jitter ourselves into serious trouble.

We have been down this road before- exactly 12 years ago. Then, the Republican president with nine months in office was Richard Nixon, and the issue that brought thousands to the streets was Vietnam.

The troubles in today's economy are, thank goodness, a lot less ugly a mess than Vietnam was 12 years ago. But there are certain simllarities in the situation. The basic problem in both instances is one the Republican administration inherited from its Democratic predecessor. "Curing" the problem is the basic mandate each Republican president received from the voters.

In both instances, the Republican president put in place by the fall of his first year a long-term strategy for extricating the country from its bind. And in both instances, the opposition has gone to the streets with the claim that the program is not really as advertised in the previous campaign and, even if it is, it is not producing results as fast as they are needed.

There was plenty to criticize in Nixon's Vietnamization, and there is plenty to doubt about Reaganomics. But it seems to m~ that any fair-minded appraisal has to conclude that there is greater political legitimacy to Reagan's current effort than there was to Vietna.mtzation, and therefore a more compelling case for caution in condemning it.

Whlle lives are being hurt by the Reagan economies, the human damage cannot be compared to that which resulted from Nixon's decision to attempt a gradual pullout, which prolonged the agony of the Vietnam War.

The Reagan plan-to a much greater extent than Nixon's-was suggested in fairly explicit terms by the president's campaign statements. True, he dodged the painful truth about reductions in entitlement programs and the shift of responsibUities to state and local governments. But anyone who did not understand that Reagan was proposing a tnJajor trade-off-lower taxes for fewer federal government services-was not listening.

But the most significant difference is that

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22491 Reagan's plan has been given explicit approval by Congress, while Nixon's represented purely executive-branch decisionmaking.

Moreover, it Wla5 given approval by Congress as a long-term policy, not a quick-fix expedient.

As readers of this column know, there have been grave doubts expressed a,bout the pace and scale of the reduction in federal responsib111ties and the manner in which programs have been hianded off to states and cities or just abandoned. I have been even more skeptical about the size of the tax cuts, and the promise of future tax indexation is one I thought no prudent Congress should make three years in advance.

But this policy was aoproved by majorities le~ than two months ago. It has not yet been put in place. To consider scrubbing it now--or replacing it with an invisible alternative--strikes me, not as a sensible political judgment, but as a reaction of pure panic.

There will be time--and need-for midcourse corrections. But to attempt them in the waning days of a congressional session, rather than in the 1982 consideration of the Reagan budget, entails even greater risks than the gamble implicit in Reaganomics.

[From the Detroit News, Sept. 10, 1981] LET'S GIVE REAGAN ECONOMIC PACKAGE A

CHANCE

(By Willard C. Butcher) Someone once said that the modern Amer

ica's prayer is: "Dear God, I pray for patience, and I want

it right now!" The latest examples of this instant-grati

fication syndrome are the supposed sages of Wall Street, who, according to the other day's newspapers, are "concerned that the Reagan administration's economic program is not working."

"The question," intoned one such market analyst, "is no longer whether the administration can balance the budget, but whether the whole supply-side concept will ultimately work."

Come on, fellahs. Let's give the President and his economic program time to at least become operative before we start to bury it.

Indeed, it's appalling when supposedly sophiscated observers denounce the administration's tax and budget cuts, llterally before they take effect on October 1. That's not unllke ordering a new air conditioner and wondering, before it's delivered, why the house isn't cool yet.

In my view, little public purpose is served by sniping at the administration's economic package while ignoring the real facts , which, I belleve, are the following:

First, President Reagan has begun-and I underscore begun-to orchestrate a massive change in economic direction in this country which, for the first time in decades, attempts to reduce the role of government and increase the role of private citizens to forge their own economic future .

This philosophy, not unimportantly, parallels that of Thomas Jefferson and the other Founding Fathers, who belleved the greater defense of capitalism was the encouragement of individual liberty.

So the President's economic direction for the country should be indisputable-even on Wall Street. Stated another way, the issue is not where we are going, but how we are going to get there. And getting from here to there requires that we leap a huge chasm and, on the way, endure a good deal of shortterm, economic pain-unbalanced budgets, high interest rates, reduced social programs, tight money markets, and all the rest.

In business terms, what the president is trying to do is invest in long-term strategies which, in the short · run, may prove to be

somewhat costly. They are designed, however, to improve the long-term "profitability" of our nation and the overall standard of living of our people. And I personally believe they are well worth the pain.

And "pain" is exactly what we are in store for-a painful period of economic readjustment. I also would expect a few missteps along the way, as we attempt first to reign in and then to turn around an economy running amok. To think that everything wlll go smoothly is, to me, the height of naivete.

It also is important to remember that, as the President himself has acknowledged, this economic program is merely a first step. Clearly, much more must be done to get us back on the track to economic growth and prosperity. For example:

Further significant budget cuts are imperative to continue to reduce the government's drain on the private, productive economy.

We must continue to hack away at counterproductive, government overregulation, an area where we have barely begun to scratch the surface.

Anti-trust policies must be reexamined in light of increased competition from foreignowned competitors both in the United States and abroad.

Social Security and other similar programs must be revamped to strike a balance between the legitimate requirements of the citizenry for health and welfare and the long-term needs of the nation for growth and prosperity.

All these things and many more must be addressed, and I believe President Reagan and his administration wlll address them.

But all will take time. And counting out the president's program before the bell rings strikes me as being very unfair. I'm surprised, frankly, that the criticism, presumably because of the pain involved in jumping our economic chasm, seem to have forgotten that the objective is to get to the other side, trying to eliminate the pain of adjustment, they've obviously also forgotten Lloyd George's warning that "the most dangerous thing in the world is trying to leap a chasm in two jumps."

In the view of this Wall Streeter, then, President Reagan already has taken bold and dramatic initial steps to soundly redirect the economic policy of our nation. I believe he deserves not our blind loyalty, but at least our patience and, more important, an honest effort by each of us to differentiate between short-term problems of economic readjustment and long-term prospects for economic re-emergence.

(From the Providence Journal, Sept. 13, 1981)

CONGRESS SHOULD BACK REAGAN PROGRAM

"Having called earlier this week for additional cuts of $10 billion to $15 billion in the already-pared 1982 budget. President Reagan summoned his department heads Friday and hit them once again-hard. This time he ordered his Cabinet to chop more than $30 billion out of the 1983 budget and $44 billion in 1984.

"Why the slashing attack on budgets that have already been heavily pared? In order that Mr. Reagan may keep the 1982 budget deficit within the $42.5 mlllion framework he promised earlier this year, and ultimately balance the budget by 1984. The urgency to meet these commitments stems from the sustained high level of interest rates that are causing anguish in the business sector and

· in Congress. "To his credit, Mr. Reagan has refused to

succumb to the panicky reaction of some members of Congress, including some Republicans who should know better. Some legislators are blaming the 'barons of Wall Street' for high interest rates, implying that there is

some sort of cabal that meets in secret to manipulate interest rates. That version of how the money market works is either the result of economic ignorance or political duplicity.

"The money markets which center in the lower reaches of Manhattan consist of more than $4 tr1Uion in debt and $1 trill1on in equity. This vast quantity of money is not an American lake; it is an international ocean, beyond the capacity of any group of Wall Street managers to manipulate. The interest rates that use of this capital commands reflect demand, which in turn is keyed to the degree of confidence borrowers have that capital wm be available when and as needed. When borrowers anticipate huge federal deficits, they worry that the Treasury wm shoulder them out of the market.

"In this context, congressional threats to 'punish Wall Street' by reinstating credit controls or slapping a windfall profits tax on interest are purely political. Economically, thev are self-defeating.

"President Reagan recognizes the realities; he spurns such empty posturing and directs attention back to the source of the current high interest rates--deficit spending. One may argue about where further costs should be made, but it is hard to argue against the logic that the solution lies with less spending and not with legislative palliatives to ease the pain that overspending inflicts.

"Currently being heard is a proposal to give the President unprecedented power to impound congressionally appropriated funds. The idea has a certain practical merit. It means Congress can hand over to the President the nasty job of saying no to programs with potent constituencies. But it is a coward's way out. Far preferable for Congress to stand up to the challenge, make the cuts, and shoulder the blame. Especially since, back in 1974, Congress decided to do just that when it took away the impoundment power from President Nixon and reformed its own budget-writing process so as to be more responsible.

"We would not like to see Congress now abandon its efiort to be fiscaiJ.ly responsible at the first major test of its resolve. However, if the legislative branch cannot summon the courage to do what needs to be done, then perhaps it should give Mr. Reagan temporary impoundment powers to get the economy past the present situation.

"For our part, we doubt that the present peak interest situation will continue unabated, especially if Mr. Reagan continues on his present course. For one thing, the personal income tax cuts voted by Congress do not come into effect until October 1. When their stimulative impact on the economy begins to be felt at that time-an important factor in the President's supply-side ga.me plan-interest rates and other aspects of the economy may well begin to perform more acceptably.

"It is far too early to start bewailing Mr. Reagan's economic program as a failure, and irresponsiblle for Congress to undercut it for political reasons."

1 From the Columbus Dispatch, Sept. 22, 1981]

A PREMATURE PROTEST

. Reagan's policies haven't even taken effect yet and some within the labor movement are saying ,they have failed. This is at best grossly premature and at worst irresponsible.

"Saturday's mass labor rally in Washington, at which an estimated quarter of a million people protested Reagan's policies, is an example of misdirected anger. Workers, to be sure, have grievances. So do poor people who can't get jobs and rich people who have their earnin~ heavily taxed. But the grievances flow from the cause of the economic


problems facing t his country and not from the solutions proposed by the president.

"Reagan is trying to undo the damage caused by decades of deficit spending and uncontrolled taxation. He is trying .to relieve t he economy from t he burdens of inflation and recession caused by undisciplined fiscal policies . And he is trying t o help stimulate the economy and get new jobs creat ed so that more people can work and those who do work will have greater buying power .

"Lt's not going to be easy, and the success or failure of his programs certainly cannot be evaluated before they are implemented. Next year's congressional elections will be time enough to begin to judge Reagan 's effect! veness. Then and only then will the real evidence begin to emerge . Then and only then can a responsible verdict be reached."

1 From Human Events, Oct. 3, 1981] COUNTRY' S FUTURE AT STAKE: REPUBLICANS

MUST RALLY AROUND REAGAN BUDGET CUTS

Unlike some of those !air-weather budgetcutters in Congress, President Reagan decided last week to push his war against federal spending, but even the President could not go far as he wished because of astonishing resistance from within his own ranks.

In his nationwide TV speech-delivered as as we were going to press-the President outlined a plan that he hoped would bring about a balanced budget by 1984. His recommendations included the elimination of the departments of Education and Energy, r eduction in entitlement programs, slashes in government borrowing authority and a prudent drawback in defense spen ding. In order to appease the non-supply siders in the financial community, he called for the enactment of user fees and ot her revenue raising measures that would bring into the Treasury $22 billion over the next three years. In fiscal 1982 alone, Administration officials contended the deficit would be reduced by $16 billion.

Some of the planned reductions were imprecise, and the entitlement reform package-which would specifically not include reform of Social Security-was to "be transmitted to Congress in the near future ." Nevertheless, the President did offer concrete ways in which to reduce the deficits that have been agitating Wall Street.

Happily, the President came forth with a fairly solid package, despite the yelps and howls of those jittery Republican congressmen who seem to be all a tremble more than

·a year before the congressional elections. In-deed, House Republicans were apparently so skittish about urging further cuts that they informed the President prior to his pitch that major reductions "just weren't going to fiy." Clearly, they were determined to cool the President's ardor for going after the federal budget-~wen though this is clearly the only permanent solution for bolstering the financial markets the country seems so concerned about.

Frankly, we have been somewhat surprised that so many Republican lawmakers have begun to crawfish on Reaganomics. As soon as things weren't working perfectly, they began to run from the field of battle. Dagwood Bumstead l'las displayed truer grit.

The worst offender so far has been Rep. James Leach (R.-Iowa), the new head of the liberal Ripon Society, who last week issued a vicious, across-the-board attack on the Reagan Administ ration's domestic and foreign policies. But even Minority Leader Bob Michel (R.-111.) , who did an excellent job holding his GOP colleagues in line on the earlier tax and budget votes, has been sounding a defeatist note. Michel has recently been telling the media how difficult lt will be to pass any new budget cuts-thus creating a poorer cllma.te for the Presidentrather than constantly challenging- the Democrats to reduce the budget deficit or bear the blame for high interest rates.

The Republican party, however, cannot retreat now from this historic opportunity to get the federal budget under control. For decades the GOP has been charging full-tilt against those "wild-spending" Democrats, so how can it now-when the country finally has a Republican President who means business-duck responsibility for reining in the budget? The GOP lawmakers put Reaganomics on the books; now they must make it work. And there is no way it can work unless federal spending has been successfully controlled.

Sen. Pete Domenici (R.-N.M.), chairman of the Budget Committee, has been so incensed with the !air-weather budget-cutters that he says that "chicken" is too mild an epithet to hurl at his GOP colleagues who now say it's politically unwise to go after the budget any further. Upset with this line of reasoning, he recently told GOP congressional leaders, that " bringing inflation down and keeping it down are the cornerstone of political success. There 's nothing as politically difficult as failure t o address the problem."

Before you worry about a single constituency, he added, remember that "if interest rates don ' t come down and inflation doesn't come down, the voters that will hold us responsible will be larger than any single group ."

There is some misguided talk that the federal budget has been cut deeply enough, but that kind of rhetoric is dangerous nonsense. President Carter and the Congress, for instance, thought they had actually balanced the budget in 1981 , but, poof!, it is now some $60 billion in the red. President Reagan and the Congress thought t hey had held the fiscal 1982 deficit to $42 .5 billion when they left for the August recess, but the best estimate now is that this understates the deficit by about $16 billion . In view of this record, how can the markets be "reassured" that spending has been tamed? When we talk to businessmen, we get the same story over and over again: The politicians have continued to promise lower spending and balanced budgets, but they always renege in the end.

Treasury Secretary Donald Regan, in some highly unpublicized remarks before the House Budget Committee last week, gave this as a major reason for the Wall Street shakes:

"The primary source of the uncertainty gripping the markets is this unanswered question: Will we have the courage to see the new policies through, or will political pressures and rivalries cause yet another Administ ration to back away from its chosen course before it has reached its goals?"

In order for this Adm inistration to reach its goals , said Regan, it must cut back drastically on federal borrowing, since this borrowing soaks up huge amounts of funds that should be available for private business. It is this "crowding out" effect which is having such a devastating upward push on interest rates. And in order to reduce borrowing, of course, the Congress will have to continue to scale back explosive federal spending programs.

The ever-growing federal intrusion into the credit markets was dramatically underscored by the secretary's figures . From 1955-1959, the federal government, based on direct federal borrowing, guaranteed loans and government-sponsored borrowing, absorbed just 19 per cent of the credit markets. From 1970 to 1974, it absorbed 21 percent. From 1975 to 1979, the federal government's share of the credit markets was 27 per cent; and in both 1980 and 1981, the figure was a whopping 36 per cent. If one includes state and local financing, government absorption of the credit markets may come close to 50 per cent.

Funds raised under federal auspices averaged just $32.5 b111ion in the early 1970s; they are averaging $135 b11lion in the early

1980s--<>r four times the sums of seven years ago.

This is a chief reason why interest rates are so high, and this is why the President is so intent on reducing the role of government ill our lives. The truth is that the federal government-even in the wake of the first round of budget cuts-is still so huge that it is continuing to wreak havoc with the economy.

The President's speech contained one major disappointment, however. He had originally wanted to deal with the Social Security system, but because of tremendous pressure from Republican lawmakers in the Congress, he failed to come to grips with this spectacular spending program. Indeed, he has put off any possible reform until January 1983 when a bi-partisan commission is supposed to come up with a solution.

Unquestionably, the program is politically sensitive, but unless the Republicans are willing to tackle such uncomfortable, but enormously significant problems, they will never control the budget.

Social Security is the General Motors of t he entitlement programs, shovelllng out billions of dollars annually to 36 million retirees. Because of its precarious financial position, it has become an increasingly heavy burden for the taxpayer to shoulder. It has also become a major obst acle to the success of the supply-side tax incentives that Congress embraced in August. And it is for this reason we cannot understand why Rep . Jack Kemp (R.-N.Y.), the premier congressional supporter of supply-side economics and a man whom we normally agree with, felt impelled to publicly state that he will oppose any Social Security cuts.

Back in May, Richard Schweiker's Department of Health and Human Services revealed just how d~eply the current Social Security system cut against the grain of the tax re<luction program.

Here's what the HHS fact sheet said: "Americans are already taxed to the limit .

The last major Social Security payroll tax hike (in 1977) was the largest peacetime tax increase in American history.

"The tax increases legislated in 1977 are still being phased ln. Social Security tax rates increased by 8Y:! percent in 1981 and will increase another 15 percent by 1990 without any change to current law.

" Unless excessive costs are curbed, Social Security could eventually consume virtually the entire domestic budget (excluding national defense and interest on the national debt).

"To restore OASDI's solvency would req uire a further 12.4 percent increase in OASDI payroll tax rates each year. FICA t axes would, on this basis, consume in 1985 about 16 per cent of taxable payroll, falllng equally on employers and employes. This would place a heavy new tax burden on current workers. For the typical two-worker family, this double surcharge would increase their Social Security taxes by $1,670 in 1986 over 1981. Employers would face an equal increase."

Prof. Martin Feldstein, president of the National Bureau of Economic Research and perhaps the most knowledgeable student of Social Security, argued a similar point in the Wall Street Journal just this past week. ·

"The Social Security program," he lamented, "is in serious financial trouble. The government 's actuaries predict that the retirement fund will run out of money in 1982 if there is no reduction in benefits or increase in revenue. And looking to the longer term, the actuaries warn that the changing age distribution of the population means tax rates of more than 20 percent and perhaps m.ore than 30 percent to finance the benefits implied by existing law. If such high· payroll taxes were piled on top of other federal and state taxes, most individuals would find themselves paying more than 50 cents in tax on every extra dollar they earn."


Prof. Feldstein, who conclusively demonstrates that Social Security benefits have far outpaced the inflation rate during the past de::ade, calls for "an immediate start to slowing the growth of benefits."

We think the professor is right on the mark. But unless this Administration and the Republicans in Congress face up to Social Security's enormous problems, Reaganomics is not going to work. The crushing tax burden and the huge federal deficitswhich we fervently hoped the Reagan Administration would cure-wm st111 be with us for a long time to come. And the Republican party w111 deservedly get the blame.

[From the Christian Science Monitor, Sept. 28, 1981]

PATIENCE NOT PANIC

Yes, Pres-ident Reagan is somewhat more defensive now. It is clear that the eupl}oria generated by his solid and quick legislative victories over the economic recovery package has diminished as he confronts an unresponsive financial market and growing resistance from pressure groups in Congress and among the public at large. The Democrats are finding their voice again. Even some Republicans are beginning to protect their own political turf. Washington is returning, as wellrespected polltical commentator David Broder puts it, to the more normal state of "polltics as usual."

But this is no reason for impatience. Wall Street gurus seem to be tempting the country with a sense of panic again-ironically at a time when there are some positive signs to be seen. The public should bear in mind that what the stock market does has only peripheral effect on the economy as a whole. Panic over the looming budget deficit, moreover, is totally unfounded and simply a psychological reaction. Studies show that the US government deficit as a proportion of the gross national product is much smaller than in such economically sturdy economies as West Germany and Japan. After 20 years of such deficits anybody's e<:onomics--Keynesian or non--calls for moves to bring a balance. But not frenzy if the project takes time.

What positive signs do we have in mind? Without exaggerating them, they at least should be mentioned as the search for economic stab1Uty goes forward. Inflation has dropped from a 12.4 percent annual rate in 1980 to about 8-9 percent now; the underlying deflator, too, is declining. Interest rates seem to be inching downward. Labor unions are under pressure to moderate wage demands, and some are doing so, opting for job security instead of big raises. And there are signs the United States may be turning the corner on the decline in labor productivity. We have now witnessed six straight quarters of 2 percent annual increase in productivity.

It is true the economy is headed for a showdown, perhaps a recession, as still-high interest rates and limited money supply contract business activity. But that, after all, is supposed to be the whole point of the monetary exercise-to brake the economy, bring down inflation, and then start up the economy again at a less rapid rate in order to avoid another inflationary explosion. The process is slow; it is also painful. But it is widely accepted as a necessary step in curing inflation.

What. then, of the President's "supplyside" program? No one yet knows whether it wlll work and many legitimate doubts are raised about the President's assumptions (that tax cuts will translate into massive savings, for instance). But, even if it does work, It will take time. Mr. Reagan Is not being unreasonable when he asks the public to withhold judgment until the program actually goes into effect and has been In operation a while.

However, the President did miscalculate earlier this year on his budget figures and the priority now, if the economic package is to

· keep its original outlines, is to make further spending cuts. Some of Mr. Reagan's still sketchy proposals look worthy--eliminating certain tax loopholes for businesses holding federal contracts, for instance, and imposing fees on users of waterways and other federal services. But there has been a less-than-bold attack on the big-ticket items. After first courageously taking on social security, for instance, the President has done the politically expedient thing by dropping such proposals as a delay in cost-of-living raises and calling instead for a bipartisan committee to come up with a plan. Obviously he wants to spread the political risks.

Nor has President Reagan gone after the defense budget with the same standard of close examination as he has applied to social programs. In the end he may find himself increasingly losing political ground if he continues to slice away with what can seem indifference at his "safety net" for the poor and disadvantaged--and even at such middleclass benefits as tax credits for energy conservation-when the amount of waste and inefficiency in the milltary establishment remains high.

It is possible In fact that President Reagan is not as wedded to his proposed $13 b111ion cut in defense over three years as he makes out. More likely, with his eyes on the far right wing of his party, he may be leaving it to Congress to make further reductions in the Pentagon budget.

All of which is to remind ourselves again that there is no fast or foolproof way to turn the American economy around. The President moved forcefully and effectively in the early months, largely because it was perceived he had a popular mandate for his actions and because he stepped on few constituencies with strong political power. Now, as opposition grows-and as his own forecasters proved overoptimistic on the size of the 1982 deficit-he must tough it out in a normal give-and-take battle with the lawmakers. The American people, for their part, must tough it out too. They are given to wanting quick results, but there will be no substitute for holding to a steady, patient course.

[From the Wall Street Journal. Sept. 29, 1981]

GUARDED GURUS: INVESTMENT MANAGERS BACK REAGAN's GOALS BUT EXPECT PROBLEMS

"By and large, we obviously believe in the general thrust of the Reagan program," says John A. Hlll, the president of Marsh & McLennan Asset Management Co. "Long term, we think the tax program will stimulate significant economic growth and capital formation."

In supporting President Reagan's policies, the official of the Marsh & McLennan Co.'s unit reflects the views of many U.S. money managers. However, he also is expressing the views of many of them when he adds:

"But in the short term, those (the President's goals) are going to be frustrated by the government deficits and heavy borrowing requirements. The tax cuts are making the deficits bigger, and he isn't going to get anywhere near the real budget cuts he needs. So, until we see real progress on the deficit, either through revenue increases or through budget decreases, we think the economy will be stagnant, with some risk of an economic collapse comparable to (that in) 1974.''

TOUGH TIMES SEEN

Following the President's address Thursday night, Robert G. Wade Jr., the president of BA Investment Management Corp., BankAmerica Corp.'s investment subsidiary, observed that he "wasn't unhappy" with the Reagan program, but he added:

"Of necessity, it involves a. significant amount of pain. That's what the market is reflecting as much as anything else. It pro-

duces a period of instabillty and uncertainty in the economy."

The instabillty and uncertainty were clearly visible in yesterday's hectic markets. In the stock market, the Dow Jones industrial average plunged to a half-hourly low at 10:30 a.m., when it was off 14.27 points, but then recovered to end up 18.55, the biggest dally rise in six months; volume was heavy (see story on page 3) . The bond market traced a similar pattern, with an early decline and then a recovery that left prices higher on the day (see story on page 2). On foreign stock markets, prices generally plunged (see story on page 3) .

Underlying the markets' swings are the investment community's widely advertised deep-seated doubts about whether the Reagan program will work. And those doubts weren't allayed by the President's most recent address. George McKinney, senior vice president of Irving Trust Co. in New York, observes:

"President Reagan's message last week showed they are visibly scratching to find a few hundred million in savings. Yet, they're telling us that finding $75 billion more ln the next couple of years will be no problem. It's no wonder that markets are skeptical."

Moreover, the sl-~:epticism extends beyond the Reagan program itself to the American public. The Reagan economic plan, says Harold E. Johnson, the executive vice president and chief investment officer at Continental Corp., "is a long-range program, and I think it's a mistake to !ool~ for short-term results." But the official of the big insurance company adds: "The American people are impatient. They take pills for everything, headaches and fallen arche3. They like instant cures. But in the economy, that's impossible, and I think it's a mistake to expect them."

Doubts also continue to be raised about whether the Fed·~rd.l Reserve will keep pressing its fight against inflation. Frederick G. Mitchell, executive vice president of Research Management Associates Inc., says that If the Fed sticks to the current level of monetary growth, the investment-consulting subsidiary of Waddell & Reed Inc., will probably increase its stock and bond portfolios steadily over the next six months. But if the Fe:l relaxes its reins and the money supply surges, he says, 1t will be "disastrous" for the stock market.

Amid all these doubts, investment managers continue to he unusually cautious. For example, Marsh & McLennan Asset Management, which manages $12.5 blllion in mutual funds and pension money, began taking "defense" stf!ps in June, Mr. Hill says, "when it became clear to us he (the President) was going to get the tax cut but not the budget cuts he asked for."

Among those "defensive" steps, Mr. Hill adds, was an increase in the proportion of short-term money-market investments in the portfolio to a 25 percent to 30 percent range from 5 percent to 10 percent last spring. Bond maturities were shortened. And s::>me funds were switched from stocks of small growth companies to those of larger, better-capitalized corporations that seem likely to hold up better in a tough economic environment.

A somewhat similar strategy is being pursued by Continental Corp. Mr. Johnson says the insurer isn't investing any significant amount of funds in the bond and stock markets and has bullt up its short-term cash position 25 percent above the year-ago levels. However, he says the company has been making "equlty-tyoe investments"-typically involving both loans and an equity stake-in oll and gas production and venture ca:pital. The total return on such investments typically exceeds 20 percent, he says.

Mr. Johnson notes that Continental's general reluctance to invest isn't solely attributable to doubts about the Reagan program.

22494 CONGRESSIONAL RECORD-SENATE September 30, 1981 He says ConJtinental, like other big propertycasualty insurers, is being badly battered by widening underwriting losses and a slowdown in premium growth. The two forces, he adds, have sharp-ly cut the amount of money thBit Continental h:as available for investment.

''What's going on in the economy is positive," he says. "But it's secondary to what is going on in our business." If the underwriting cycle deteriorates further, he 8Jdds, "this could result in a liquidity problem for us."

Mutual of OmJaha Insurance Co. faces similar problems. ~tly because of increases in insurance claims and in sunenders of a~nnui:tles by policyholders, the company "hasn't made a long-term intzestment this year,'' says John L. Maginn, the vice president for investments.

The way a money manager's strategy is influenced by his own operating problemsas opposed to natlotl!8J prablems-is strikingly illustrated at Republic Bank of Texas. There, one money manager is avoiding longterm bonds while another is buying them.

The man avoiding them is Raleigh ~ortenstine, the executive vLce president for funds managemerut. Mr. Hortenstlne gets his inveslta·ble funds mostly from sho11t-term certificates of deposit, and consequently he is draining the ba.Illk's $750 million investment portfolio of long-term bonds as fast as he can without taking big losses. As bonds mature, he puts the cash into short-term investments. "Our strategies are in place," he says. "No one speech is going to change them."

But across the hall is H. Edward AndeTson, the senior investment officer overseeing $3.7 ·billion of discretionary trust funds for individuals and. employe benefit plans. Because he doesn't have Mr. Hortenstine's worries about the costs of money, Mr. Anderson is plowing huge sums into long-term, fixed-rate bonds. He knows that the money he supervises will be in his hands for a long time, and he can afford to take the long view concerll!l.ng the Reagan economic program.

Although Mr. Anderson concedes that Wall Street has concluded that Mr. Reagan isn't cutting spending sufficiently, the trust officer considers the President's recent speech "one small step toward continuing to curb spending." So Mr. Anderson views long-term bond as a bargain because rates are historically high compared with inflation. "It doesn't take much to realize return of 25 percent to 30 percent (through capital gains) when coupon rates are at 15 per cent," he says. Therefore, his strategy for the next 12 months will be to buy bonds, even though "it suffers from not being right for the past 12 months."

Most money managers are a long way from making such a decision, however. Before Luther King Capital Management, e. Fort Worth manager of pension funds and other investment pools, goes back into long-term bonds, says Emmett Murphy, a vice president, "we need to see three things: a confirmation of some sort that secular (long-run) inflation rates are coming down, that government intervention in the capital markets is shrinking in real (inflation-adjusted) size and that corporate balance sheets are going to be in better shape."

Many other money managers express similar views. At Mutual of Omaha, Mr. Maginn se.ys he supports that Reagan economic program but adds that most large investors "are looking for some proof of efficiency-they aren't taking anything on faith." He adds, "I can't see anything in the short term that will change the psychology of the market." At Security Pacific Investment Managers Inc., e. Security Pacific Corp. unit, Lloyd McAdam, the president, says, "We would be Interested in 1on~-t.erm bonds when and if we believe that corporations and individuals aren't so

intent on paying for everything with borrowed money." And at Fidelity Management & Research Co. in Boston, Fred Henning, the senior vice president for fixed-income investments, says the company won't change its "very defensive" policy until it sees signs that the federal deficit is coming under control and that corporate and government credit demand is slowing. "Once we see that, we'll review our strategy," he adds.

[From the Wall Street Journal, Sept. 10, 1981]

WALL STREET AND THE BUDGET

President Reagan has returned from the West to discover that it's the White House, not Santa Barbara, that the Apaches are circling. They're all uttering the same bloodcurdling cry: "Look what's happening on Wall Street!"

We hope the President and his troops continue to avoid panic because this may prove to be the biggest test yet of their nerves. It calls for a cool-headed look at why Wall Street was so unimpressed with those July budget and tax victories.

One reason is that Wall Street knows the July budget reconciliation victory was only a battle, not the war. There's still plenty of fighting to be done to make the budget cuts real. For example, even though the reconciliation bill calls for cutting some $4 billion in Social Security benefits, the House has already passed and the Senate will soon consider a bill that would restore minimum benefits, the one important thing the administration had thought it had won.

Another reason is that the positive side of the Reagan program, lower tax rates, has not yet taken effect. The air still is full of doubts and conjecture and will likely continue to be until after October 1, when the cuts begin to have impact on the economy.

And finally, Wall Street, for all its accuracy in recording and playing back economic signals, is not a one-track tape. Capital markets are international and Wall Street has some interest, to say the least, in places like Gdansk, Moscow, Paris and New Delhi. What it sees is risk, and the possibility that some disaster will someday be met by a new inflationary outpouring of dollars.

All that considered, however, the economic situation is not nearly as bad as the politics of Washington would have us believe. The economy is indeed fiat but one could hardly say it has been pole-axed by the extended period of high interest rates it has had to endure. Indeed, auto sales in August were relatively strong. Steel production, retail spending and durable goods orders continue to run well ahead of a year ago. Most economic forecasts are for real economic growth for 1981.

Moreover, there is a good side to those high interest rates. Small savers, by means of money market funds and the gradual removal of savings account interest ceilings, are finally being allowed to earn market rates. We already are seeing signs of a revival of personal savings, which had been dried up by the combination of inflation and interest rate ceilings. One thing happening on Wall Street is that the attractiveness of money market funds has transferred a lot of the action out of the securities markets and into the banks, but there is every reason to believe that this will be a temporary phenomenon 1f the Fed continues to wedge down money growth and inflation.

The renewed attack on the White House is in fact a continuation of the old attack by the President's opponents in Congress. The aim is to put the President into a box. If he admits to concern about the high interest rates and flatness of the economy, lt can be said that he has lost confidence in his own program (the one, keep in mind, which

hasn't yet gone into effect). If he professes no concern, his leverage for holding the budget ground he has won and winning more is weakened.

The President has only one course. He must keep up the budget battle until it really is won, while at the same time displaying no loss of confidence in his program. There are still large areas of federal spending that are ripe for cutting if the President can overcome congressional opposition. As we have said here before, we would even be willing to suffer a trimming of projected military spending if we could see evidence of a coherent defense strategy. It should be kept in mind that Wall Street has heard September promises of tight budgets too often in the past. It will begin to believe when it sees how the budget looks next March.

It's a healthy sign that so many people are suddenly taking Wall Street seriously. It's too bad they didn't start years ago, when stock and bond prices first started to falter under the impetus of soaring federal spending and rapid money creation. Back in 1965, after all, the Dow was near 1,000, equivalent to 2,540 in 1981 dollars. While no one in Washington was watching it plunged to 950 a month ago. Now because of another 100-point tick in the last month, the conventional wisdom is that Ronald Reagan, who has done more to cut the budget than any President In 20 vea ~s. has been too timid.

This is of course an opportunity f• r Mr. Reagan. By all means he should cut more. The new proposal for impoundment powers is a good one. Something has yet to be done to get a grip on the entitlements programs. All this should be done, but without panic or apology.

BLAME WALL STREET

(By David S. Broder) De3pite the handicaps of being a non-law

yer, a non-financial expert and a non-partisan of the Reagan administration, it is plain even to me that the White House has grounds to sue Wall Street for non-support . Ronald Reagan's economic plan is being mauled by th:l money-managers even before it gets a trial run. If t.he assault weren't so reckle3sly selfish and stupid, you could r::!ally laugh.

Jf ever there has been a government in Washington eager to do a;croba.tics to please the business and finane~ia.l big shot3, it is this one. It has taken the biggest whack at fedo:-a.l spending in 50 yean, and every nickel of i ~ from "people programs" tha.t t·he monied folks don't need, don't want, don't u3e and don't support.

It has cut t.axe3 generously for rich folks and even more generously for corporations. And the response h::~.s been one sulky bear of e. market, a tails;:>in in stock and bonds and a run-up interest rates that have ~lven the country the shakes and cast a nall over the bright economic future Reagan and his allies projected. Thanks a bunch, Well Street.

However much Reagan and Co. hR."e contrived to get government off business' back, the mighty men of the financial markets have said, "It's not enough. We want more."

Although Reagan never advertised it, the tax bill he bulled through Congress goes a long way toward eliminating the corporate income tax as a si~nificant so1rrne nf fP!i<!ral revenues. A top lobbyist for the bill says it will cut the corporate tax bills in half. But a lawyer I know has a client company that paid $42 million last year and will pay somewhere between $2 million and nothing next year. G!ven the creA.tivity of cornorate accounting, I'll bet that is far from unique.

The smart guys in Wall Street know thiseven if most of the average Joes who were phoning their congressmen to pass the Reagan tax bill did not. The smart guys know

September 30, 1981 CONGRESSIONAL RECORD-SEN A I'E 22495

what the tax bill means for corporate cash flow and future after-tax profits.

They know these are the ingredients for a booming stock market that would funnel billions into job-creating investment. But they ain't buying stocks. Why? Because they can make even more money cashing in on the incredible interest rates they can exact from govemment and private borrowers in the current debt-refinancing crunch.

As a top Washington busines3 lobbyist put it, "They can make 20 percent, with virtually no risk, buying short-term government obligations, so why should they take the risk of equity investments?"

From one viewpoint, you could say Reagan is getting exMtlY what he deserves, as a ,true believer in the historically dubious theory that there is a "natural harmony" between business advantage and the public interest.

Having exalted the virtues of the marketplace, he is now seeing his own program victimized by men who calculate everything by the bottom-line calculus of that coldly impersonal market. For Reagan to "jawbone" the financiers for lower interest rates, as congressional Republicans suggest, would not just be ineffective, it would be thoroughly inconsistent with his own principles.

And yet it is stunning to see the big wheels of Wall Street, so oallously scuttling the very program that American business, in a literally unpre:::edented fashion, has pressured Congress to pass just a few weeks ago.

I asked my lobbyist friend, a key figure in that effort, "Don't they realize they have bought in on Reagan's program and they have a. stake in its working?" It was, apparently, a naive question.

"Let me tell you," he said, "there is no more shortsighted set of people than the Wall Street financial community. I'd really like to see Reagan tell these people to shove lt. They didn't elect him and they don't own him."

But, of course, Reagan is not doing that. Instead, he is going back to Congress for yet more cuts, to convince the money-managers that he will somehow balance the budget.

I thought to myself: the people who are Imposing these demands are people who proclaim the virtues of risk-taking. But they won't take risks themselves. They are the ones who say it's time for school-lunch users and subway riders to pay their own way and even make some sacrifices. But they will shortchange American enterprise's long-term capital needs in order to ma.ke a. little more fast money from high interest rates.

My grandmother used to talk !llbout people who know the price of everything and the value of nothing. If these money-men don't understand that they will never have a govemment more eager to please than this Reagan outfit, and they sink its policies by their own shortsighted selfishness, then they deserve what they wlll get.

It's just too damn bad a lot of other people wlll get hurt in the process.

[From the Wall Street Journal, Sept. 28, 1981]

TIME TO SHAPE UP

President Reagan won a significant victo~ last summer in pushing his tax and budget bills through Congress. For a time it aiJpeared that the prestige and authority of the Executive Branch was restored after a. period of near anarchy brought about by the loss of presidential initiative in the Carter years. But the President's address to the nation last Thursday tells us that the battle is by no means entirely won. And, unfortunately, the erosion the President has suffered in September has been mainly due to the fecklessness of some of the key members of his administration.

The key mistakes of the President's team were to (1) expect instant adulation from Wall Street and Main Street over the sum-

mer economic policy victories and (2) to respond to the failure of interest rates to drop and the stock market to soar by starting to play fast and loose with budget forecasts and Congress.

Budget Director David Stockman, usually sure-footed both in his economics and his skills with Congress. was the main malefactor in this misplayed game. Reacting to criticism that the President's economic plan wasn't "working"-even before it had gone in effect-he glommed onto some of the scariest . deficit projections :available and started using them to bludgeon the returning Congress, which already had been bludgeoned by some of the home folks over high interest rates. Mr. Stockman wanted more and bigger budget cuts, which made the public and the Congress even more doubtful about the administration's confidence in its own program. None of this was helped when other members of the supplyside school fanned fears of a. bond market crisis, in their drive for a return to the gold standard.

We have argued here that the gold standard is a subject that deserves serious debate. But it has been very easy to misunderstand the urgency its advocates have demanded at a time when they have just come from major victories on the other planks of supply-side philosophy. They have created a false impression that they don't have confidence in their own program.

The fright and confusion of Congress, the appearance of disorder in the administration and the continued difficulties of the financial markets prompted the President to set about to regain the initiative. Aside from the fact that it should never have been necessary, it was Mr. Reagan's usual masterful job. He did not convey the sense of :ranic some of his underlings had displayed earlier. A call for further cuts of only $13 billion was well within the goals he had devised earlier in the year. And indeed, projections of the budget had changed, to the tune of adding some $13 billion to the projected deficit, making it legitimate for the President to ask Congress to go one more mile.

But some elements of the talk were disquieting. After having just won a major tax cut victory, he returned some ground to his anti-tax cut foes by promising to close some "loo::-boles" to the tune of some $21 billion over three years . A few more flip-flops like that and Mr. Reagan w111 have himself a credibility problem. And it may well be that he has conceded too much, too soon on Social Security by acceding to the idea of borrowing from other trust funds to replenish the retirement fund and by introducing the idea of "neediness" (hence welfare) into his plan for the minimum benefit.

The question that arises out of all this is whether the President would have been better advised to si-mply sit tight, try to make sure that the Congress del~'Vered on the budget cuts it had promised in the summer and told his budget chief to lay off the heavy rhetoric. He could have ended his speech to the people with the line that it 's far too early to judge an economic program that hasn't yet gone into effect and by calllng for a few more budget cuts to offset the budget items, such as interest rates and agricultural subsidies, that don't look as promising as they did last spring. He could have also asked Congress to restore the $9 billion in cuts he asked for but didn't get.

The damage from the September panic is not overwhelming. The President has, on the whole, withstood the assault . And it could even be beneficial if this young administration has learned a few things about governing, primarily that policy making is not something you do in fits and starts, with key players competing to see who can

offer the most tantalizing tidbits to the press. It requires constancy and political honesty. We hope that the administration now will go back and review this September during which, in an excess of hubris over its summer victories, it almost delivered itself back into the hands of its foes . The exercise would be very useful as preparation for the battles that still lie ahead .

[From the Wall Street Journal, Aug. 1, 1981] MUZZLE THE MAJORITY LEADER

If anyone knows a good treatment for overwrought Congressmen, we urge him to rush to Capitol Hill and try to calm the place down. It seems that some Republicans went home for vacation and discovered that some of their best-heeled constituents dislike anti-inflationary policies. Both Senate Majority Leader Baker and House Minority Leader Michel came back in a tizzy, threatening to get out the 1970s snake oil againcredit controls, ·windfall profits taxes, wage and price controls, you name it.

The thing that has the Republicans upset, and the Democrats intemperately gleeful is, of course, the continued high level of interest rates. It seems that some people who developed big borrowing habits in the inflationary 1970s are finding the stuff expensive und~r the present regime. They're blaming the Eastern bankers, Wall Street, Paul Volcker, and all the other usual suspects. Congress, in response to the self-righteous complaints of these addicts, is threatening to take steps. The only difference from the 1970s is that this time it's the Republicans, not the Democrats, leading the pack.

Should it be any wonder, then, that Wall Street has no confidence in the anti-inflat ion fight? Has any recent Fed chairman ever b~en able to stand up before this kind of onslaught from the Hlll? Is it any surprise that the price of gold has headed upward in tune with the rising pitch of Howard Baker's and Bob Michel's voices?

Just for perspective, let's get one thing straight: The inflation take-off of the 1970s was a political phenomenon. It came about because som~ powerful political constituencies , not all of which would be accurately described as "liberal," saw ways to benefit from. inflation. The Democrats, when they were m power, were politically astute enough not to even try to buck these forces but inflation got so bad it finally swept a Democratic President and Senate majority out of power.

Republican Congressmen are acting as if they were never even aware that a proinflation lobby existed. They might do well to try to r~call the lesson of last November· There's also an anti-inflation lobby but it often keeps quiet until voting time.

It doesn't take much deep thought to understand why pro-inflation politics is so powerful. The combination of inflation and the interest rate tax deduction makes borrowing painless and even profitable. Anyone-small businessmen for example-who can raise prices in response to credit-fed consumer demand can play inflation like a slot machine that always comes up three oranges. Politicians love it because it automatically jacks up tax revenues. When Washington tries to change the rules, Congressmen hear from all the constituents who liked the rules the way they were and who, quite naturally, think that the rule changes represent bad policy.

But those constituents are living in a dream world, and so are the Congressmen who respond to their pleas. Inflation and easy credit are fun but not sustainable. Most people work for hourly wages or salaries and they wake up one day and find that their real earnings are falllng. Public services start to deteriorate because of inadequate capital recovery. Productivity starts to fall for the same reason. This In turn aggravates Infia-

22496 CONGRESSIONAL RECORD-SENATE September 30, 1981 t1on by slowing the flow of goods. The vicious circle can eventually turn to runaway inflation with potential to destroy a whole society.

Ron::~.ld Reagan directly and Paul Volcker indirectly received a manda.te last Nove·mber to prevent this from happening. That is why the President is struggling to out t-he federal budget and Mr. Volcker is allowing interest rates to stay high as.he tries to wedge down money growth. There is no way this can be painless to borrowers. But we are beginning to see some benefits to savers as they find it possible to obtain market interest rates. If this continues long enough savings and credit demand will come into better balance and interest rates wlll come down. Inflation already is slackening.

Mr. Baker and Mr. Miche·l would do well to give some consideration to the constituents they are not hearing from, the ones who were badly hurt by inflation but who now find their situation improving. And instead of wasting their energies scaring the life out of the capital markets they should devote them instead to thinking of ways to see to it that the anti-inflation fight succeeds.

CBO HAS DISMAL RECORD AS "DISMAL SCIENCE" SEER, CHAMBER CHIEF ECONOMIST SAYS OF PAST FORECASTS WASHINGTON, March 26.-The Congres

sional Budget Office (CBO), which recently issued a gloomy critique of the Reagan Administration's economic and budget forecast, has itself arrived at some other forecasts in the past which have fallen well short of the economy's performance, an analysis by the U.S. Chamber of Commerce's Economic Policy Division finds.

According to Dr. Richard W. Rahn, Chamber vice president and chief. economist and head of the Economic Policy Division, "Our analysis indicates that the CBO's track record leaves much to be desired. In fact, the Reagan forecast falls well within the CBO's average error range.

"Starting in January, 1976, CBO forecasters have issued a five-year forecast of the economy in conjunction with their Budget outlook. The forecasts sometimes have been hedged by having more than one forecast, such as a 'Forecast A' and a 'Forecast B.' or a baseline forecast vs . some other forecast. For purposes of comparison, Chamber economists used the one that implied the more likely scenario.

"Our examination of the forecasting record for the CBO indicat es that when forecasting for the next Budget ye::~.r each January, the CBO's average Gross National Product (GNP) estimate was off by 1.7 percentage points, with the average error in the rate of change in the GNP forecast equal to about 60 percent of the change. The Consumer Price Index (CPI) forecasts were off by 3.4 percentage points. while the unemployment rate was off by .3 percent . The Budget estimate based on a current services budget was off by $19.1 billion.

"When the forecast was made two years ahead, the error for the change in GNP doubled from 1.7 p zrcentage points to 3.3 percentage points, the CPI forecast was off by five percentage points, and the unemployment rate missed the mark by one percentage point.

"Based on this analysis, it is quite cl:.~ar that the CBO's average forecast error ranges for real GNP and consumer prices are larger than the difference between the President's estimates for these variables and those predicted by the CBO's forecast.

"Thus, given the CBO's record of fore-: casting, the Administration's estimates are clearly plausible and are consistent with the estimates generated by the Chamber's Forecast Center."

The table below provides the details of the CBO's average error rate for key economic variables computed by the Chamber's Economic Policy Division:

AVERAGE CBO ERROR

[In percentage points]

1-yr 2-yr 3-yr forecast forecast forecast

GNP __ ------ ---- ---- 1.7 3. 3 3. 9 CPI _____ ____________ 3. 4 5. 0 6.8 Unemployment_ ______ . 3 1.0 2. 0 Budget_----- -------- 19.1 34.9 67.3

Note: Data based on an analysis of CBO Forecasts between 1976 and 1980.

SPEECH OF MILTON FRIEDMAN TO NTLC SEMINAR

At best, .the federal amendment cannot come into operation for something like four years. It must get out of the Senate and the House. It must pass the states and the amendment even then comes into force only after two additional fiscal years. You do have to allow for time to adjust to it.

So it will be about four years. How that amendment works and what it does for us depends critically on where we are at the

_end of those four years. That's why the President's proposals for restraining the federal budget, for holding down federal taxes , is an integral part of the campaign .to get the amendment passed.

There is a short term and a long term element of that campaign. The short term element is to try to do the best we can in the next four years to hold down the budget so that the constitutional amendment starts from as low a base as possible.

You notice, I didn't talk about budget cuts and tax cuts. Nobody, but nobody is proposing a budget cut. Nobody but nobody is proposing a tax cut.

As Orrin Hatch was saying under the budget as it now stands, government spending next year would go up by something like a hundred billion dollars. What President Reagan has proposed is that it go up by fifty billion dollars instead of a hundred billion dollars.

Maybe I'm a penny pincher, but that doesn't look to me like a budget cut.

Similarly, under the Carter budget, taxes are scheduled to go up by about a hundred 'billion dollars. Under President Reagan's proposals, taxes would go up by something like fifty or sixty billion instead of a hundred billion. Again, I don't call that a tax cut.

What the President is proposing is a slowing down in the increase in spending and taxing. It's a move in the right direction, and don't misunderstand me. I think that the budget message and .the tax message that President Reagan proposed are remarkable documents. They show a great deal of courage and go a · great, long way in starting the process of cutting government down to size.

But they only start the process. Let me say a word about the expenditure

side, and then I will go to the tax side. On the expenditure side, we had what was

called a great victory a week or two ago, when the Congressional resolution was passed. But that was a first step in a long process.

As Orrin Hatch said, they passed a resolution to balance the budget last year. What happened to it? The recent budget resolution like the one last year, so far as I am concerned, is at the moment pure paper. It is a pure expression of sentiment. It carries no power. There is absolutely nothing to make Congress live up to it except pressure from the public at large.

The real fight will be fought in committee after committee as each individual set of cuts

in proposed appropriations comes to that committee and has to be adopted. That's where the real fight is going to be fought . That's where you are going to have hand-tohand fights.

The real question is whether the momentum can be maintained to keep the pressure on so that in those successive committee fights, we'll end up with the total that the President has asked for. That's a long, hard road.

Moreover, this is the year 1981; 1982 comes, 1983 comes, 1984 comes. The reason we are all part of the National Tax Limitation Committee and have been fighting for a constitutional amendment is because we recognize how difficult it is to hold down government spending through statutory means by considering one program after another. we recognize that for each individual program there is a big constituency that wants to cut government spending at somebody else's expense.

So the battle is just starting. Never in my lifetime, and I suspect in most

of yours, have we had as great an opnortunity to win that particular battle, thani{s to the vote last November, thanks to the special character of the man we have in the White House-a man who has been extraordinarily effective, who is a man of principle, who has been sticking by what he says and wlll continue to do so.

So we have a chance to win it but it is a very difficult battle and it has to be fought over and over again. ,

I want to come to the tax side. There has been a great deal of criticism on the part of the press, and particularly on what's called Wall Street-a place where there is a lot of financial muscle and very little wisdom.

I might add one more thing. I have always said that the two places in the country where you have the shortest foresight, where people look ahead the shortest period, are Wall Street and Washington. On Wall Street, you look to what is going to happen next week. At least in Washington, you look to the next Congressional election, which is a little longer, though not much.

At any rate, there has been a lot of criticism that the President's tax proposals are radical, inflationary, irresponsible, that you cannot now start to hold down taxes unless you first hold down government spending.

Who is making these arguments? They are coming from the people who brought us where we are. They are coming from the people who are responsible for our present big budget. They are coming from the people who are responSible for our present high taxes.

They know very well how to keep the taxes high. That's what they are experts in. But what they don't know and don't understand is how to get spending and taxes down.

In my opinion, the situation is precisely the reverse of what they claim. I know if I had a child who was spending too much, the most effective way to cut his spending would be to cut his allowance. If you know anybody, whoever it may be, and you ask yourself what would be most likely to make him spend less, you can be sure it's to cut his income.

It's no different with Congress. It's no different with government. The Congress is going to spend whatever the tax system raises, plus a good deal more. But that good deal more is not indefinitely expansive. Especially under current circumstances, when there is enormous popular pressure for a balanced budget. That's manifested in the form which this amendment took. It's manifested in the success which Jim Davidson and his associates have had in getting thirty states to call for a constitutional convention.

Deficits are unpopular. The way to get the budget restraints implemented is to make


sure the feet of Congress and t he Senate are kept to the fire of having t o avoid excessive deficits. The way to do t hat is t o hold down the amount of money they have coming in .

That is why I have long been in favor of cutting taxes under any circumstances for any excuse for any reason in any way whatsoever.

I strongly favor the particular kind of tax cuts that President Reagan has proposed, cuts that are for three years so that you only have to vote once to keep their feet to the fire three years in a row. I t's a terrible t hing to have to face t his fight each year, year after year.

I like the idea that the tax adjustment is across the board for individuals because that gives you a broad basis of support in the populace. If I had my way, of course, I would like the reductions in rates to be even bigger. I think it would be nice if we could have tax changes that eliminated the whole of that hundred billion dollar increase that's scheduled in the budget.

But I am a little bit realistic, not often, but sometimes, and I recognize there are limits to what you can do. So I think the President's tax program makes a great deal of sense.

I'm not arguing for it on the mistaken view that people have attributed to some proponents of supply side economics. I am not arguing for it because I believe that cutting tax rates will increase government revenues. There is no doubt that there will be some effect in that direction . There is no doubt that cutting marginal tax rates on individuals will lead them to refrain from some tax shelters they might otherwise engage in , will lead them to work harder, will lead them to save more, to invest more effectively ,. and therefore that the reduction in revenue will be less than the Treasury will estimate by its standard procedures. But that's not my main argument.

In fact, if it were true that a particular cut in tax rates would increase government revenue, then I would say that the cuts weren't deep enough, because my objective is to reduce the revenue. I regard it as a disadvantage of a cut in tax rates if it does not decrease the revenue .

In order to get as much of an incentive effect as possible on enterprise , initiative, investment and so on, what you need to do is cut high marginal tax rates. There is no doubt that cutting those high marginal tax rates will have a big feedback effect by increasing the amount of income reported.

But we ought to cut tax rates deeply enough so that the feedback effect is more than offset and revenues decline. That is the only way, in my opinion, to bring effective pressure on Congress to keep spending down .

The other argument that is being made is that somehow tax cuts in tax rates are inflationary. Again, the people from whom that argument is coming are not the reoule I've heard in past years complain about inflation. The argument is coming from those people who produced the inflation, those people who have told us all along that we are unduly concerned about the problem of inflation and are not sufficiently concerned about the problem of unemployment.

Let me go to the argument itself. There are two points I want to make.

The first is inflation is not produced by the budget. Inflation is produced by the Federal Reserve System and nobody else. The Federal Reserve System has been behaving, in my opinion, very badly. It has been eno-ineering extraordinarily erratic monet:ry growth over the past couple of years. It has recently embarked on an exPansionary path of monetary growth, which if continued, threatens to torpedo much of the President's economic program.

If there is a wild bull in the china shoo at the moment, unfortunately, it's the Fed~

eral Reserve, If you want to stop inflation that's where you 've got to look.

The second point is, if you reduce government spending by a dollar, that takes a dollar out of the stream available to bid for goods and services. If you reduce tax receipts by a dollar , that adds a dollar to the st ream. Why don 't the two cancel out?

Is there some way in which, when the government spends a dollar , that 's not inflationary? But when a private individual spends a dollar it is?

Is there some way when the government spends a dollar it adds to employment, but when a p r ivat e individual spends a dollar it doesn't add to employment?

I must say that is a distinction which escapes me completely.

Those who are arguing against the tax proposals are ccmpletely wrong from beginning to end. They should be re;ected. We should all support as strongly as we possibly can the adoption in full of the proposals that President Reagan has made to cut tax rates, as well a::; to restrain the budget.

As I said at the outset, we have reason for congratulation. I think the reporting of the amendment out of the Judiciary Committee is a marvelous thing and we ought to all be delighted w1th it. But we do not have any reason for complacency. We have not won. The first batter has been up to bat. The first ball has been thrown. The pitcher on our side got a strike. That's about where we are in this game.

Thank you.

Mr. SCHMITT. Madam President, I am happy to join my distinguished colleagues in this New Year's Eve party.

Tomorrow begins the new fiscal year. If not for the events of last November, this would have been like many other beginnings of fiscal years in the past. It would have marked the advent of another cycle of outrageous spending by the Government, burdensome taxation of earnings, and poor economic performances.

Last November, however, the people of this Nation asked for an end to that. They asked for relief from high taxation which paid for outdated or inefficient Government programs. They asked for relief from Government interference in their businesses and private lives. We gave the American people the relief for which they asked.

Not only did the Congress agree to major budget reforms in the Omnibus Reconciliation Act and also agreed to the largest tax cut in history, but the appropriations process is now under control for the first time in decades. This has been most clearly shown by the reforms and expeditious handling of the fiscal year 1981 rescissions and supplemental bill.

Tomorrow begins the program that we had the courage to enact. We have reason for pride. Over the past 9 months, we have cut the personal income tax burden more than any other time in the history of the United States. We have for the first time cut back on the rate of growth of the Government budget. More than that, we have shown that we are committed to restoring balance and growth to our Nation's economy.

We have done a good job, but it is not over. In fact, we have just begun. In order to achieve a goal of a balanced budget. further refinement mu.st be found. It will be done. Other things must be

achieved as well. My colleagues in the Senate know well my concern for the amount of saving done in today's economy. Saving, foregoing current consumption, is the capitalist economy's way of providing the basis of investment for future generations.

Savings are the source of capital for investment and that investment is the generator of increased productivity and employment. Investment means new plants and equipment and new jobs to build new production facilities and operate new machinery. If the critical element of personal savings is absent from this equation, then production and employment suffer. To achieve the economic goals of full employment and price stability that are the express goals of our national economic policy, it is crucial that our economy generate increased investment through increased savings.

Recent studies have shown a close correlation between rates of growth and th~ rates of savings and investment. It is, therefore, no coincidence that the United States, with the lowest rate of savings among major industrialized nations, is also affected with stagnating economic growth. The U.S. rate of savings as a percentage of national income in 1976 was only 4.9 percent compared to rates of 7.1 percent in England; 12.4 percent in France; 13.0 percent in Germ1.ny; and 20.9 percent in Japan.

The anemic level of U.S. savings as compared to the leading industrial nations of the world accounts, in part, for the declining GNP growth rate and high inflation rate of the United States as measured against these same nations. It is interesting to note that each of these countries offer considerably greater incentives to savings and investment than does the United States.

The tax cut that we have enacted will return more of the hard -earned wage to the wage earner and his or her family. When we voted on the tax cut, our hope then and our hope now is that the taxp:wer would save his or her tax cut.

Consider, though. a person in the 35-percent tax bracket who saves $500 of h :s tax cut. Let us assume that he can get a 10-percent interest payment in 1 year on that $500 saving. In 1 year he will have $550. However, after we get through taxing his interest, he will have $532.50. The real rate of return on his investment will be 6.5 percent. Where is the incentive to save with inflation well above 6.5 percent? Can we blame the taxpayer for preferring consumer purchases to a low return on his savings?

With the "All Savers Act" there is reason to believe that the taxpayer will save. On the heels of All Savers there is a provision which, starting in 1985, will exclude 15 percent of net interest up to $3,000 from taxation. We need to do more.

This provision only begins to address the problem. In our work ahead we should strive to provide an incentive to save at all levels of saving. We should work to find a level of taxation on savings which will insure a large stock of inexpensive capital for our future.

22498 CONGRESSIONAL RECORD-SENATE September 30, 1981 We have plenty to be proud of as we

move into the new fiscal year and into a new era of fiscal responsibility. Today is a good day to be proud, and tomorrow will be a good day to continue our work.

Mr. JEPSEN. Madam President, October 1, 1981, is the first day of the new Federal fiscal year. And, perhaps more important, the first day of America's new economic beginning.

Today, I join with my Senate colleagues to make the official inception of the Reagan economic program. The Reagan program for economic recovery offers even-handed approaches to cutting taxes and Federal spending in order to restore economic justice to all Americans.

As vice chairman of the Joint Economic Committee, I have chaired a number of hearings on the economic aspects of problems in our defense and farm industries. I have also presided over a series of hearings on the troubled social security program.

The bottom line solution to all of these problems is a healthy American economy-one that is not hindered by excessive regulation and taxation.

The Reagan program is the first step taken to cure the disease rather than simply cover up the symptoms. And, contrary to the charges of the President's critics, it has already made some important differences in our economic stability.

When the previous administration left office, the year-to-year inflation rate was 15.2 percent, unemployment was at 7.4 percent and Federal taxes took 22 percent of the gross national product.

By comparison, the year-to-year inflation rate, or CPI, is now running slightly under 9 percent. Unemployment is at 7.2 percent and when the President's first term is over about 19.5 percent of the GNP will go to Federal taxation.

All of that has occurred in this period before the tax and budget cuts have gone into effect.

Coupled with a substantial amount of the newly proposed budget cuts, I believe America is on the right track to return to a healthy economy.

The Joint Economic Committee will continue to examine economic matters of concern to the Congress and the American people.

William Albrecht, an associate professor of economics at the University of Iowa, recently wrote an article which offers a good summary of the Reagan program and the hope it offers for our economic recovery.

I ask unanimous consent that it be printed in the RECORD.

There being no objection, the article was ordered to be printed in the RECORD, as follows:

[From the Daily Iowan, Sept. 25, 1981] REAGAN'S ECONOMICS CAN WORK

(By William Albrecht) Seven weeks ago, virtually everyone agreed

that Ronald Reagan was a miracle worker. Not everyone liked the miracles, but the President had indeed achieved the impossible. He had talked Congress into a huge tax reduction and had persuaded it to reduce spending in areas long thought to be off limits to budget cutters. But heroes don't last very long in America. Reagan's miracles are now forgotten; instead we worry that he

sleeps too soundly. After all, interest rates are high, the stock market is down, investors are jittery and Congress is on the verge of panic-its usual reaction to unpleasant news. Already we can read editorials announcing that Reaganomics is dead.

But obituaries for Reagan 's economic program are premature. It has not even gone into effect yet. Moreover, the odds are that, given a chance, it will have reasonably successful results.

The four elements of Reaganomics-slower growth of government spending, lower tax rates, tight money and less regulation-have been thoroughly analyzed by friend and foe alike. Unfortunately, the debates over the specifics of each element have tended to detract attention from the program as a whole. And the basic rationale for what Reagan is trying to do can be understood only by looking at the entire package. This in turn requires an understanding of what makes a market system, or capitalism, work.

Capitalism is based upon what Adam Smith termed "the desire for bettering our conditions." It is a system that provides incentives for improving our conditions. People respond to these incentives by working, producing, saving, investing and taking risks. As a result of this activity wealth is created, and society's standard of living increases. Relatively few people do most of the investing and risk taking. Thus, it is a "trickle down" system. But it works . No other system comes close to matching capitalism's efficiency or ability to create wealth-for the worker as well as the entrepreneur.

If capitalism is to perform well, however, there must be adequate incentives for working, producing, saving, investing and taking risks. This means that for workers, there must be rewards for effort and penalties for lack of effort. For businesses, entrepreneurs and other risk takers, there must be rewards for success and penalties for failure. Without such rewards and penalties, economic stagnation is inevitable.

The basic thrust of the Reagan program is to increase (or restore) the incentives that make capitalism work. Over the past several decades, government has enacted many laws which have lessened incentives. Many, perhaps most, of these laws are desirable. No one of them has seriously reduced incentives. But as a whole, they have made a major contribution to the stagnation of the U.S. economy.

Income support programs reduce the penalties for not working and not saving. The high benefit-reduction rates in most such programs also reduce the risk taking, especially by small businesses and small investors. They also stifle competition and promote monopoly Government subsidies and bailouts to business, reduce the incentive to be efficient. Price controls reduce the incentive to invest where investment is most needed.

High tax rates and tax shelters provide incentives to invest in low productivity areas rather than high productivity ones. High tax rates also distort the incentives to work and save. The list goes on and on. Then add to this the impact of inflation on incentives. Inflation is, in part, responsible for high tax rates. It also generates political pressure for spending programs, such as those mentioned above, which reduce incentives. Additionally, inflation by itself is a great distorter of incentives. It punishes savers and rewards spendthrifts. It punishes those who invest in new technology and new factories and rewards those who invest in gold and other unproductive assets.

Stopping inflation, therefore, is essential to Reagan's attempt to restore incentives. And this is the aspect of the program which raises the most doubt. The administration is relying almost exclusively on tight money to control inflation. This and the huge borrowing demands by the federal government are causing today's high interest rates. High

interest rates , of course, tend to choke off investment, and slow economic growth. The administration, therefore. in looking for additional budget cuts-even to the extent o! questioning the once sacrosanct defense budget.

The trick now is to get the deficit small enough so that interest rates will fall without sacrificing an anti-inflationary monetary policy. If this can be done-and there is no economic reason why it cannot-it is likely that the rate of inflation will continue to decline. More importantly, our real income will start to grow.

With a little bit of luck-such as political stability in the Mideast-the economy, will do much better in the 1980s than it did in the 1970s. A number of shocks, including the dramatic rise in oil prices, the collapse of the old international monetary system and a change in the composition of the labor force, slowed the economy in the last ten years. We have finally adjusted to most of these changes, and the stage is almost set for a period of sustained, relatively non-inflationary growth. The major missing ingredient has been the incentives that will allow our capitalistic system to do what it does best--create wealth. The Reagan program promises to supply this ingredient. It should be given a chance.

Albrecht is a UI associate professor of Economics.

The PRESIDING OFFICER. The Senator from Florida is recognized.

THE PRESIDENT'S PROPOSALS TO FIGHT CRIME AND DRUG TRAFFICKING

Mr. CHILES. Madam President, the day before yesterday, the President unveiled his proposals to fight crime and drug trafficking. I would like to make a few comments and observations on his plans.

First of all, I am delighted that he has come forward with a plan. On May 13, exactly 20 weeks ago, I persuaded 12 other Senators to go with me to the White House and ask the President to make the fight on crime his No.2 domestic priority, just after the economy. His speech yesterday shows that he has responded to the concerns we raised at that meeting, and is moving forward to fight crime. I am really pleased. I welcome his commitment and support. We need it. I certainly pledge my cooperation in this fight.

I was also pleased to see that he has come down so strongly in favor of the proposals that I and many of my colleagues are working on to fight crime and drug trafficking.

In the fight against drug trafficking: The President wants to encourage crop

eradication programs for illegal drugs grown overseas. That amounts to an endorsement of a bill I introduced earlier this year <S. 664>. It lifts the present restrictions on using foreign assistance funds for that purpose. That bill has already been adopted by the Senate Foreign Relations Committee as an amendment to the foreign assistance bill which is now before us.

He wants to get the military more involved in helping law enforcement officials catch drug smugglers as they approach our shores. By doing so he endorses a bill that I and several S~nators proposed to amend the posse comitatus law. ·That bill, if enacted, would foster


better detection of smugglers since it enables the military to pass on radar sightings to local police. That measure has already been approved by the Senate, as part of the defense authorization bill.

The House has also passed similar legislation. They are now in conference working out the differences in the defense authorization bill.

He wants to increase efforts to stop drugs at our borders. That sounds like my efforts to get the Coast Guard more involved in intercepting drugs. I was able to earmark $300 million for an expanded Coast Guard construction program, and I am trying to get the full amount funded in the Appropriations Committee.

He wants the IRS to be more involved in catching criminals and big time drug dealers through financial investigations. That is an endorsement of a bill <S. 732) Senator NUNN and I introduced to get the IRS more involved in catching big time criminals. That bill passed the Senate earlier this year as an amendment to the tax reform package. I am disappointed to say the House did not accept that in conference, but they have assured us they will hold hearings on it.

The President also outlined several proposals to reform our courts, to make sure that our criminal justice system is as fair to the victim of crime and to society as it is to the criminal. Once again, his proposals amount to an endorsement of several court reform measures that many of us in the Senate have been working on.

He wants to change the bail statutes, to make sure that dangerous criminals who are arrested are not put back on the streets. That concept-telling the judge to look at the danger that release of a person poses to the community-is a central feature of my bail reform proposal <S. 1253), and of several others introduced by other Senators. I would like to see him focus on the special problem of bail for drug traffickers who are arrested.

He wants to reform the so-called exclusionary rule, that at times lets the guilty go free because of a technical violation of the search and seizure rules by the police. I agree with that, and have endorsed this proposal in the past.

He wants to increase penalties for persons who use a firearm to commit a crime. One of the anticrime bills I am working on <S. 814) would do just that. I would also like to increase penalties for large scale marihuana traffickers.

I am deeply concerned, however, about another event that took place yesterday. While the President was announcing his tough, new offensive against crime, his budget cutters were slashing the budgets of Federal law enforcement agencies.

With the crime and drug trafficking situation being what is is, this is hardly the time to cut back on our law enforcement arms. I know that the President is committed to a strong national defense program. As far as I am concerned, the fight against crime and drug trafficking is every bit as vital to our national secu- · rity as a strong defense program is.

I consider it to be domestic defense, and I do not think that we can afford cuts in domestic d,efense any more than we can afford to cut national defense.

I

I am especially concerned because the effect of the budget cuts would be to reduce our domestic defense budgets below the levels originally proposed by the Carter administration earlier this year.

The budget cuts proposed, according to the information I received, amount to a 6-percent cut in the FBI, a 12-percent cut in the Drug Enforcement Administration, a 10.4-percent cut in the Coast Guard, a 6-_t:ercent cut for U.S. attorneys, a 6-percent cut for the Customs Service, and a 4.5-percent cut for the Internal Revenue Service. And it is important to keep in mind that these cuts are based on the Justice Department budget submitted in March. That budget has already made cuts from the original law enforcement budget proposals that the Carter administration proposed in January. So at a time when the President is moving forward with a series of proposals to fight crime, his budget cutters are moving to deny our law enforcement agencies the resources they need to do the job. The President took a step forward in fighting crime on Monday, but I am afraid his budget cutters took a step backward at the same time.

Madam President, the table I am submitting sets out the budget requests for Federal law enforcement agencies at different points in this year.

Madam President, I ask unanimous consent that the table be printed in the RECORD.

There being no objection, the table was ordered to be printed in the RECORD, as follows:

FISCAL YEAR 1982 BUDGET REQUESTS

(Dollar amounts in millions)

Jan-uary Sep-1981 March tember

Agency (Carter) 1981 1981

FBI. .• -------------- $743.6 $739.0 $696.0 DEA _______ ---- __ ---- 236.2 228.5 201.0 U.S. attorneys ________ 194.8 189.9 178.5 IRS.- --------------- 2, 649.2 2, 566.0 2, 454. 0 Customs Service. _____ 510. 2 480. 0 451.2 Coast Guard __ ___ _____ 2, 200.7 2, 193.0 1,\164.4

Cuts from Jan-uary 1981

$47. 5 35. 2 11.4

195.2 59. 0

236.3

Mr. CHILES. Madam President, I am serious about fighting crime, and I believe that the President's remarks on Monday show that he is serious, too. But it is vital that we make sure that our law enforcement agencies have the resources to win that fight. I am concerned that the budget cuts will cripple that effort to fight crime and drugs. And I do not think that is something that the President wants to do.

I yield back the remainder of my time.

RECOGNITION OF SENATOR FORD

The PRESIDING OFFICER. Under the previous order, the Senator from Kentucky is recognized for 15 minutes.

Mr. FORD. Madam President, I thank the Chair.

BUDGET AND OVERSIGHT IMPROVEMENT AMENDMENTS OF 1981 Mr. FORD. Madam President. I am

today introducing for myself and Mr.

BuMPERS a bill to amend the Congressional Budget and Impoundment Control Act of 1974, the Budget and Accounting Act of 1921, and the Legislative Reorganization Act of 1946. This action is motivated by the recent experience with budget and appropriations bills in Congress, particularly our current and familiar delay in enacting regular appropriation bills, and by a growing conviction that an annual budget cycle is no longer suitable to the needs of the Federal Government.

Each appropriation year the executive and legislative branches spend countless hours making hundreds of line item decisions. The time and energy consumed in this effort diverts both branches from focusing attention on the major budget and spending decisions. There is little doubt that these decisions can be better made on a 2-year rather than 1-year cycle.

In the past 5 years, deadlines for first and second budget resolutions have been met only twice out of ten reporting dates. The lag in the other eight completions extended for as many as 74 days. And, of co·urse, this year, for fiscal 1982, we have already passed our September 15 deadline by 15 days, and the Senate is not expected to act on the second budget resolution until sometime in November. This would be 2 months after the completion date specified in the Budget Act and a full month into the new fiscal year.

In the same 5 years, only in one were all13 regular appropriation bills enacted by th_e beginning of the fiscal year, and even m that year <fiscal 1977) a continuing resolution was needed to fund some programs, and for the 5 years, a total of 10 continuing resolutions had to be enacted. In 4 of the years, the enactment of the continuing resolutions lagged 10 to 17 days after the fiscal year began.

Clearly, we are not doing our budgeting jobs well. It is time we concentrated on making necessary improvements.

All of us chafed under the pressure and haste of this year's budget reconciliation measures. It is unwise to attempt reconciliation in the first budget resolution, and it is unwise in the reconciliation pro~ess to direct the standing committees to rush through ill-considered-if considered at all-changes in the substantive statutes which establish and shape Federal programs.

Such use of the Congressional Budget Act was never intended. Those pressure practices constitute a denial of due process to Members of Congress, and through them, to the public at large. The b1ll I introduce today-a nonpartisan commonsense bill~propooes to correct these procedural flaws. But it will do more because it proposes to establish a biennial budget cycle for the Federal Government.

By limiting reconciliation to the second budget resolution, the bill should prevent the mistakes that resulted this year from pressure and haste. The bill also offers a solution to the dilemma which has forced the Budget Committees to include reconciliation in the first resolution in the first place, by providing more time both for reconciliation and the second resolution, and by a pro-


posal to withhold enrollment of spending bills until completion of the second resolution and reconciliation.

It has become increasingly clear to me that we in Government are not efficiently utilizing our time. The magnitude and complexity of our executive and legislative branch duties have grown by leaps and bounds-but the clock and the calendar remain unexpandable.

Among the things we can do to better organize our activities is to convert our budget-appropriation cycle to biennial, rather than annual. This is not a new idea. It has been proposed, propounded and considered in the past.

Annual authorizations, budgeting and appropriations have become so timeconsuming that we scarcely finish the job 1 year before we must plunge into it again for the next. The rush is so great that not only is it questionable whether we do a good job, it is clear that our oversight and other legislative duties suffer severely from the annual budget demands.

In a recent article published in the March-April1981 issue of Challenge, the Director of the Congressional Budget Office, Alice M. Rivlin, gave forthright expression to her views on the congressional budget process, and made several wise recommendations. Among these were her suggestions relating to a biennial budget system.

Dr. Rivlin commends the existing budget system as a vast improvement over pre-1974 methods, but acknowledged a widespread public perception that Congress does a bad job of budgeting. She attributed this to two main factors, namely, first, the failure to accept and deal with economic uncertainty as an inescapable fact of life, and second the propensity to try to do too much and make too many not-so-important deci.sions. She added,

In particular, the annual budget cycle is a pernicious one. For most activities of government, annual review is too frequent ....

Further into her article, Dr. Rivlin observed:

An obvious first step toward reducing the frequency of decisions on government programs would be two-year appropriations for almost everything. This would allow the Congress to use the first year of each twoyear session for oversight and the second to enact a two-year appropriation.

After some thoughtful comments on the virtue, if not necessity, of longer continuity and reliabilit~; with respect to the funding of many government programs, the article concludes that:

( 1) Economic forecasting is still a.n uncertain art and economists' estimates of the effects of policy change leave much to be desired; ( 2) annual review of all spending is wasteful, and one-year-at-a.-time budgeting impedes consideration of major budget changes with enough time to carry them out; and (3) a better system would involve fewer, less frequent appropriations, a. multiyear planning cycle, but room for short-run flexibility in a. few programs.

Consider how much valuable time can be saved, for our executive department officials and Members of Congress if we cut in half the budget tasks confronting us. Consider, for example, the substantial

savings in printing costs alone, by making such a change.

There are many variations on what Congress can do with respect to scheduling authorizations, budgeting activities and appropriations bills. Our colleague, Senator BuMPERS, has this year introduced Senate Resolution 22, directing the Budget and Governmental Affairs Committees to conduct a study on the feasibility of moving to a biennial fiscal basis. However, I believe the potential benefits, not only ·to the Congress but to the executive branch, are so great that it would be better to move directly to consideration of a specific bill to accomplish this objective.

Some of the advantages of a 2-year budget system should be briefly noted. They are:

First, there will be savings of time, effort and money;

Second, multiyear planning, budgeting and appropriations will allow for more careful legislative work on all matters-new legislation, oversight, budget resolutions and appropriations;

Third, extending the budget period can and should introduce a greater degree of spending discipline and stability, and can be a major, effective step in curbing inflation; and

Fourth, State and local governments will benefit greatly from the increased certainty of the Federal impact on their plans and budgeting.

Twenty-one States, including my own State of Kentucky, have for several years successfully and profitably followed this practice. While there are, of course, many differences which make a StateFederal parallel less than perfect, biennial budgeting can be done successfully in the Federal Government, and I believe it should be done.

It is interesting to note that while past OMB Directors have had some objections and reservations to biennial fiscal proposals, the present Director, David Stockman, was a cosponsor of H.R. 2000, a bill introduced in the 96th Congress to provide for just such a 2-year budget, authorization, and appropriation system. Also this year, the General Accounting Office has already indicated its support for the concept in commenting on the Bumpers resolution.

Madam President, this is not an antibudget procedure bill. It is not antiBudget Committee, or Appropriations Committee, or any other committee. I sincerely believe this bill would strengthen the budget process and benefit every committee. More importantly, it would benefit the entire scope of all government operations, Federal, State, and local, and· thus, of course, would benefit all the people these governments serve.

Madam President, I intend to ask that the bill lie on the desk for 3 days so my colleagues may join me in sponsoring this legislation.

Now, Madam President, I ask unanimous consent that following my remarks there be printed in the RECORD: First, the bill itself, second, a section-by-section analysis, and, third, a short summary of the bill.

There being no objection, the material

was ordered to be printed in the RECORD, as follows:

s. 1683 Be it ena~ted by the Senate and House of

RepresentattVes of the United States of America in Congress assembled, That this Act may be cited as the "Budget and Oversight Improvement Amendments of 1981".

FINDINGS AND PURPOSE

SEc. 2. (a) The Congress finds and declares that the present annual Federal budgeting process-

( 1) allows insufficient time for the fulfillment by the Congress of its legisla t1 ve and oversight responsibilities;

(2) allows in sufficient time for the review and consideration by the Congress of authorizing legislation, budget resolutions, and appropriation bills and resolutions and other spending measures;

(3) allows insufficient time for the evaluation of costly and complicated Federal programs, which contributes to the unrestrained growth of the Federal budget; and

( 4) allows insufficient time for agencies and State and local governments to plan for the implementation of programs.

(b) It is the purpose of this Act to establish a more thorough and timely process for the adoption of the Federal budget by

( 1) esta.bllshing a. two-year cycle for the adoption of the budget;

(2) including Federal loan guarantees and off-budget agencies and activities in budget totals and in the budget process;

(3) requiring the separate and distinct consideration of authorizing legdsla.tion, the budget, and appropriation bllls and resolutions and other spending measures and there.by allow1ng full evaluation of the need for and the merits and costs of the various programs and agencies of the Federal Gove,rnment;

( 4) strengthening congressional procedures for the consideration of budget resolutions reconciliation bills and resolutions, appro: pria.tion bills and resolutions, and other measures providing spending authority; and

(5) strengthening the requirement for congression~a.l oversight of Federal p·rogra.ms by authorizing committees.

REVISION OF TIMETABLE

SEc. 3. Section 300 of the Congressional Budget Act of 1974 is amended to read as follows:

"TIMETABLE

"SEc. 300. The timetable with respect to the congressional budget process for any Congress (beginning with the Ninety-eighth Congress) is as follows:

"First Session "On or before: Action to be completed: November 10 (of the preceding session) Pres

ident submits current services budget for the 2-fiscal-yea.r budget period beginning in the succeeding even-numbered year.

January 10-President submits his budget for 2-fisca1-year period beginning in succeeding calendar year (the '2-fiscalyear budget period').

Apr111-Congressional Budget Office submits report to Budget Committees with respect to 2-fiscal-year budget period.

May 1-Committees and joint committees submit reports to Budget Committees with respect to 2-fiscal-year budget period.

June 1-Committees report b1lls and resolutions authorizing new budget authority for 2-fisca.l-year budget period.

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22501 July 1-Budget Committees report first con

current resolution on the budget for 2-fiscal-year budget period to their Houses.

August !-Congress completes action on first concurrent resolution on the budget.

October 1-Committees report allocations of first concurrent resolution among programs within their jurisdiction.

October 1-Congress completes action on bills and resolutions authorizing new budget authority for 2-fiscal-year budget period.

"Second Session "On or before: Action to be completed: January 10-President submits revised

budget for 2-fiscal-year budget period.

April !-Committees report bills and resolutions providing new budget authority and new spending authority for 2-fiscalyear budget period.

April !-Congressional Budget Office submits report to Budget Committees with respect to 2-fiscal-year budget period.

June 15-Budget Committees report second required concurrent resolution on the budget to their Houses.

July !-Congress completes action, except enrollment, on b111s and resolutions providing new spending authority for 2-fiscal-year budget period.

August !-Congress completes action on second required cpncurrent resolution on budget for 2-fiscal-year budget period.

september 25-Congress completes action on reconciliation bill or resolution, or both, implementing second required concurrent resolution.

October 1-2-fiscal-year budget period begins.".

TWO YEAR CYCLE FOR CONGRESSIONAL BUDGET PROCESS

SEc. 4. (a) Section 2 (2) of the Congre3-sional Budget and Impoundment Control Act of 1974 is amended by striking out "each year" and inserting in lieu thereof "biennially".

(b) (1) Section 3(1) of such Act is amended-

( A) by striking out "fiscal year" and inserting in lieu thereof "2-fiscal-year budget period"; and

(B) by striking out "such year" and inserting in lieu thereof "such period".

( 2) Section 3 ( 4) of such Act is amended by striking out "fiscal year" each place it appear3 and inserting in lieu thereof "2-fiscal-year budget period".

(3) Section 3 of such Act is further amended by adding at the end thereof the following new paragraph:

"(6) The term '2-fiscal-year budget period' means the period of 2 fiscal years beginning on October 1 of any even-numbe::-ed year.".

(c) Section 202(f) (1) of the Congressional Budget Act of 1974 is amended-

(1) by striking out "each year" and inserting in lieu thereof "each fiscal year in a 2-fiscal-year budget period";

(2) by striking out "fiscal year commencing on October 1 of that year" and inserting in lieu thereof "succeeding 2-fiscal-year budget period"; and

(3) by striking out "such fiscal year" each place it appears and inserting in lieu thereof "such 2-fiscal-year budget period".

(d) (1) Section 30l(a) of such Act is amended-

(A) by striking out "MAY 15" in the subsection heading and inserting in lieu thereof "AUGUST 1 OF EACH ODD-NUMBERED YEAR";

(B) by striking out "May 15 of each year" in the first sentence and inserting in lieu thereof "August 1 of each odd-numbered year"; and

(C) by striking out "the fiscal year beginning on October 1 of such year" and inserting in lieu thereof "the 2-fiscal year budget period beginning on October 1 of the succeeding year".

(2) section 301 (c) of such Act is amended-

( A) by striking out "March 15 of each year" in the matter preceding paragraph ( 1) and inserting in lieu thereof "May 1 of each odd-numbered year"; and

(B) by striking out "the fiscal year beginning on October r of such year" in paragraph (2) and inserting in lieu thereof "the 2-fiscal-year budget period beginning on October 1 of the succeeding year".

(3) Section 301 (d) of such Act is amended-

( A) by striking out ''fiscal year" in the first sentence and inserting in lieu thereof "2-fiscal-year budget period";

(B) by striking out "April 15 of each year" in the third sentence and inserting in lieu thereof "July 1 of each odd-numbered year";

(C) by striking out "the fiscal year beginning on October 1 of such year" in the third sentence and inserting m lieu thereof "the 2-fiscal-year budget period beginning on October 1 of the succeeding year";

(D) by striking out "five" in paragraph (~) and inserting in lieu thereof "six";

(E) by striking out "such fiscal year" in paragraph (6) and inserting in lieu thereof "the first fiscal year of such 2-fiscalyear budget period,"; and

(F) by striking out "such period" in paragraph ( 6) and inserting in lieu thereof "such six fiscal year period".

(4) Section 301 (e) of such Act is amended-

( A) by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscal-year budget period"; and

(B) by striking out "set for" in paragraph (1) and inserting in lieu thereof "set forth".

(e) (1) Section 303(a) of such Act is amended-


(B) by striking out "such year" and inserting in lieu thereof "such period".

( 2) Section 303 (b) of such Act is amended by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscal-year budget period".

(f) Section 304 of such Act is amended by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscalyear budget period".

(g) (1) Section 307 of such Act is amended-

( A) by striking out the section heading and inserting in lieu thereof "coMMITTEE ACTION ON APPROPRIATION AND OTHER SPENDING BILLS'';

(B) by inserting "(a) Committee Action on Regular Appropriation Bills.-" before "Prior";

(C) by striking out "fiscal year" and inserting in lieu thereof "2-fiscal-year budget period";

(D) by striking out "that year" each place it appears and inserting in lieu thereof "that period"; and

(E) by adding at the end thereof the following new subsection:

" (b) ( 1 ) Reporting of Certain Measures By April 1 of Each Even-Numbered Year.-Ex-

cept as provided in paragraph (2), all b111s and resolutions providing budget authority or spending authority (as defined by section 401 (c) (2) (C)) for any 2-fiscal-year budget period shall be reported to the House of Representatives and Senate no later than· April 1 of the year in which such period begins.

"(2) If a committee of the House of Representatives or the senate determines that changes in circumstances with the passage of time require a waiver of paragraph ( 1) with respect to any bill or resolution providing supplemental appropriations for any period, such committee may report, and the House or Senate may consider and adopt, a resolution waiving the application of such paragraph in the case of such bill or resolution.".

(2) The item relating to section 307 in the table of contents in section 1 (b) of the Congressional Budget and Impoundment Control Act of 1974 is amended to read as follows: "SEc. 307. Committee action on appropri

ation and other spending bills.". (h) ( 1) Section 308 (a) of the Congres

sional Budget Act of 1974 is amended-( A) by striking out "fiscal year" in the

matter preceding paragraph (1) and inserting in lieu thereof "2-fiscal-year budget period";

(B) by striking out "fiscal year" in paragraph ( 1) (A) and inserting in lieu thereof "2-fiscal-year budget period";

(C) by striking out "5" in paragraph (1) (B) and inserting in lieu thereof "6";

(D) by striking out "such fiscal year" in paragraph ( 1) (B) and inserting in lieu thereof "the first fiscal year of such 2-fiscal-year budget period";

(E) by striking out "such period" in paragraph (1) (B) and inserting in lieu thereof •·such 6 fiscal year period";

(F) by striking out "fiscal year" in paragraph (2) (A) and inserting in lieu thereof "2-fiscal-year budget period":

(G) by striking out "such year" in paragraph (2) (A) and inserting in lieu thereof "such period";

(H) by striking out "5" in paragraph (2) (B) and inserting in lieu thereof "6";

(I) by striking out "such fiscal year" in paragraph (2) (B) and inserting in lieu thereof "the first fiscal year of such 2-fiscalyear budget period";

(J) by striking out "such period" in paragraph (2) (B) and inserting in lieu thereof "such 6 fiscal year period"; and

(K) by striking out "fiscal year" each place it appears in the last sentehce of such subsection and inserting in lieu thereof "2-fiscal-year budget period".

(2) Section 308(b) of such Act is amended-

(A) by striking out "fiscal year" in the first sentence and inserting in lieu thereof "2-fiscal-year budget period";

(B) by striking out "fiscal year" each place it appears in paragraph (1) and inserting in lieu thereof "2-fiscal-year budget period";

(C) by striking out "fiscal year" in paragraph (2) and inserting in lieu thereof "2-fiscal-year budget period";

(D) by striking ~ut "fiscal year" in paragraph (3) and inserting in lieu thereof "2-fiscal-year budget period";

(E) by striking out "such year" each place it appears in paragraph (3) and inserting in lieu thereof "such period"; and

(F) by striking out "fiscal year" each place it appears in paragraph (4) and inserting ln lieu thereof "2-fiscal-year budget period".

( 3) Section 308 (c) of such Act is amended-

( A) by striking out "FIVE" in the subsection heading and inserting in lieu thereof "SIX";

(B) by striking out "each fiscal year"


each place it appears and inserting in lieu thereof "each 2-fiscal-year budget period";

(C) by striking out "5 fiscal year beginning with such fiscal year" and inserting in lieu thereof "6 fiscal years beginning with such 2-fiscal-'year budget period"; and

(D) by striking out "such period" each place it appears and inserting in lieu thereof "such 6 fiscal year period".

(i) Section 309 of such Act is amended( 1) by striking out "the seventh day after

Labor Day of each year" in the matter preceding paragraph ( 1) and inserting in lieu thereof ' 'July 1 of each even-numbered year"; and

(2) by striking out "fiscal year" each place it appears in paragraphs (1) and (2) and inserting in lieu thereof "2-fiscal-year budget period".

(j) (1) Section 310(a) of such Act is amended-

( A) by inserting "in each even-numbered year" after "report to its House" in the first sentence;

(B) by striking out " fiscal year" in the first sentence and inserting in lieu thereof "2-fiscal-year budget period";

(C) by striking out "fiscal year" each place it appears in subparagraphs (A) and (C) of paragraph ( 1) and inserting in lieu thereof "2-fiscal-year budget period"; and

(D) by insertin~ "or prior 2-fiscal-year budget periods" after "prior fiscal years" in subparagraph (B) of paragraph (1);

(2) Subsections (b) and (d) of section 310 of such Act are amended by striking out "each year" each place it appears and inserting in lieu thereof "each even-numbered year".

(3) Section 310(f) of such Act is amended-

(A) by striking out "It" and inserting in lieu thereof "In any even-numbered year. it"; and

(B) by striking out " fiscal year" and inserting in lieu thereof "2-fiscal-year budget period".

(k) Section 311 of such Act is amended by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscalyear budget period".

(1) (1) Section 40l(a) of such Act is amended by striking out "fiscal year" and inserting in lieu thereof "2-fiscal-year budget period".

(2) (A) Section 40l(b) (1) of such Act is amended by striking out "the fiscal year which begins during the calendar year in" and inserting in lieu thereof "the first 2-fiscal-year budget period which begins after the date on".

(B) Section 401 (b) (2) of such Act is amended by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscal-year budget period".

( m) ( 1) Section 402 of such Act is amended-

( A) by striking OUt "REPORTING OF" in the section heading and inserting in lieu thereof "ACTION ON";

(B) by striking out the subsection heading for subsection (a) and inserting in lieu thereof "Dates for Reporting and Final Action .-(1) ":

(C) by striking out "fiscal year" each place it papears in subsection (a) and inserting in lieu thereof "2-flscal-year budget period";

(D) by striking out "May 15" in subsection fa) and inserting in lieu thereof "June 1 of the odd-numbered year"; and

(E) by adding at the end of subsection (a} the following new paragraoh:

"(2) The Congress shall comolete action on all bills and resolutions directly or indirectly authorizing the e"lactment of new budget authority for a 2-fiscal-year budget period no later than October 1 of the year preceding the year in which such period begins.".

(2) The table of contents in section 1(b) of the Congressional Budget and Impoundment Control Act of 1974 is amended by striking out "Reporting of" in the item relating to section 402 and inserting in lieu thereof "Action on".

( n) Section 605 (a) of the Congressional Budget Act of 1974 is amended-

( 1 J by striking out "each year (beginning with 1975)" and inserting in lieu thereof "each even-numbered year (beginning with 1982) " ;

(2) by striking out "the ensuing fiscal year" and inserting in lieu thereof "the 2-fiscal-year budget period beginning in the following calendar year"; and

(3) by striking out "such ensuing fiscal year" and inserting in lieu thereof "such period".

( o) Section 607 of such Act is amended( 1) by striking out "for a fiscal year (be

ginning with the fiscal year commencing October 1, 1976)" and inserting in lieu thereof "for a fiscal year or a 2-fiscal-year budget period (beginning on or after October 1, 1983) ": and

(2) by striking out "May 15 of the year preceding the year in which such fiscal year begins" and inserting in lieu thereof "May 15 of the year preceding the year in which the bills and resolutions setting forth such authorizations are to be reported under section 402". ADDITIONAL AMENDMENTS TO CONGRESSIONAL

BUDGET AND IMPOUNDMENT CONTROL ACT OF 1974

SEc. 5. (a) Section 2 of the Congressional Budget and Impoundment Control Act of 1974 (as amended by section 4(a) of this Act) is further amended-

( 1) by striking out "and" after the semicolon at the end of paragraph ( 4);

(2) by redesignating paragraph (5) as paragraph ( 6) ; and

( 3) by inserting after paragraph ( 4) the following new paragraph :

" ( 5) to provide for the congressional determination biennially of the appropriate level of gross obligations for the principal amount of direct loans and the appropriate level of commitments to guarantee loan principal; and".

(b) (1) Section 3(2) of such Act is amended by striking out "except that such term" and inserting in lieu thereof "and includes the authority to make direct loans but' '.

(2) Section 3 of such Act (as amended by paragraph ( 1) of this subsection and section 4 (b) ( 3) of this Act) is further amended by adding at the end thereof the following new paragraph :

"(7) The term 'direct loan' means a disbursement of funds by the United States or any officer or agency thereof (not in exchange for goods or services) under a contract which requires the repayment of such funds with or without interest, and in addition includes-

"(A) direct participation in a loan made and held by another person or government;

" (B) the purchase (through secondary market operations) of a loan made by another person or government ; and

"(C) the acquisition of a federally guaranteed loan made by another person or government, as collateral or in satisfaction of default or other guarantee claims.".

(c) ( 1) Section 202 (a) of the Congressional Budget Act of 1974 is amended by striking out "and (3)" and inserting in lieu thereof "(3) information with respect to direct loans and guarantees of loan principal, and (4)" .

(2) Section 202(f) (1) of such Act (as amended by section 4(c) of this Act) is further amended by striking out "and (B)" and inserting in lieu thereof " (B) the levels of direct loans and guarantees of loan principal, and (C)".

(d) Section 301(a) of such Act (as amended by section 4(d) (1) of this Act) is further amended-

(!) by striking out paragraph (7); (2) by redesignating paragraph (6) as

paragraph (8), and (in such paragraph) striking out the semicolon and "and" and inserting in lieu thereof a period; and

( 3) by inserting after paragraph ( 5) the following new paragraphs:

" ( 6) the appropriate level of total gross obligations for the principal amount of direct loans and the appropriate level of total commitments to guarantee loan principal;

"(7) an estimate of gross obligations for the principal amount of direct loans and an estimate of commitments to guarantee loan principal for each major functional category, based on allocations of the appropriate level of total gross obligations for the principal amount of direct loans and the appropriate level of total commitments to guarantee loan principal; and" .

(e) Section 301(b) of such Act is amended to read as follows:

"(b) ADDITIONAL MATTERS IN CONCURRENT RESOLUTION PROHIBITED.-lt shall not be in order in the Senate or the House of Representatives to consider any first concurrent resolution on the budget required by this section if such concurrent resolution on the budget includes any matter other than the matters described in paragraphs (1) through (8) of subsection (a) .".

(f) (1) Section 301(c) (2) of such Act (as amended by section 4 (d) ( 2) of this Act) is further amended-

(A) by striking out "the estimate" and inserting in lieu thereof "an estimate"; and

(B) by striking out", and budget outlays resulting therefrom," and inserting in lieu thereof "and budget outlays resulting therefrom, the total amounts of gross obligations for the principal amount of direct loans, and the total amounts of commitments to guarantee loan principal,".

(2) Section 301 (c) of such Act is further amended by inserting after "1946." the following new sentence: "The Commtttee on Banking, Finance, and Urban Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate shall each also submit to the Committee on the Budget of its House its recommendations as to the appropriate level of total gross obligations for the principal amount of direct loans and the appropriate level of total commitments to guarantee loan principal.".

(g) (1) Section 302(a) of such Act is amended-

(A) by striking out "and" after "total budget outlays" and inserting in lieu thereof a comma;

(B) by inserting a comma and "total gross obligations for the principal amount of direct loans, and total commitments to guarantee loan principal" after "total new budget authority"; and

(C) by inserting "or authorizing such obligations and commitments" after "such new budget authority".

(2) Section 302(b) of such Aot is amended-

( A) by striking out "and" after the semicolon at the end of paragraph ( 1) ;

(B) by redesignating paragraph (2) as paragraph ( 3) ; and

(C) by inserting after paragraph ( 1) the following new paragraph:

"(2) the Committee on Appropriations of each House shall also, after consulting with the Committee on Appropriations of the other House, subdivide among its subcommittees the allocation of gross obligations for the principal amount of direct loans and the allxation of commitments to guarantee loan principal allocated to it in the joint explanatory statement accompanying the conference report on such concurrent resolution; and".

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22503 (h) Section 304 of such Act (as amended

by se~tion 4(f) of this Act) i:s fc:rther amended by adding at the end thereof the following: "It shall not be in order in the Senate or the House of Representatives to consider any concurrent resolution on the budget revising a. concurrent resolution on the budget for any fiscal year which is adopted before the adoption of the second concurrent resolution on the budget required for such fiscal year under section 310 if the concurrent resolution making such revisions includes any matter other than the matters described in paragraphs ( 1) through ( 6) of section 301 (a). It shall not be in order in the Senate or the House of Representatives to consider any concurrent resolution on the budget revising the second concurrent resolution on the budget required for a fiscal year under section 310 or any concurrent resolution on the budget for such fiscal year adopted after such second concurrent resolution if the concurrent resolution making such revisions includes any matter other than the matters described in paragraphs (1) through (6) of section 301(a.) and paragraphs (1) through (4) of section 310(a).".

( i) Section 307 (a.) of such Act ( a.s amended by section 4 (g) ( 1 ) of this Act) is further amended-

(A) by striking out "and" after "budget outlays" and inserting in lieu thereof a. comma; and

(B) by inserting" , gross obligations for the principal amount of direct loans, and commitments to guarantee loan principal," after "new budget authority".

(j) (1) Section 308(a.) of such Act (as amended by section 4(h) (1) of this Act) is further a.mended-

(A) by striking out "and" after the semicolon in subparagraph (B) of paragraph (1);

(B) by inserting after subparagraph (C) of paragraph ( 1) the following new subpara-graph: .

"(D) how the level of gross obligations for the principal amount of direct loans and the level of commitments to guarantee loan principal provided in that blll or resolution compare with the appropriate level of gross obligations for the principal amount of direct loans and the appropriate level of commitments to guarantee loan principal set forth in the most recently agreed to concurrent resolution on the budget for such fiscal year and the reports submitted under section 302; and";

(C) by striking out the period at the end of subparagraph (B) of paragraph (2) and inserting in lieu thereof a. semicolon and "and";

(D) by inserting after paragraph (2) the following new paragraph:

"(3) in the case of a blll or resolution providing new or increased commitments to guarantee loan principal-

"(A) how the new or increased commitments to guarantee loan principal provided in the blll or resolution w111 affect the levels of loan guarantees under existing law as set forth in the report accompanying the first concurrent resolution on the budget for such 2-fiscal-yea.r budget period, or, if a. report accompanying a subsequently agreed to concurrent resolution for such period sets forth such levels, then as set forth in that report; and

"(B) a projection for the period of 6 fiscal years beginning with the first fiscal year in such 2-fiscal-yea.r budget period, of the outlays which wm result from that b111 or resolution in each fiscal year in such 6-year period."; and

(E) by striking "or (2)(B)" in the last sentence and inserting in lieu thereof a comma and "(2) (B). or (2) (C)".

(2) Section 308(b) of such Act (as amended by section 4(h) (2) of this Act) is further amended-

(A) by inserting "and commitments to guarantee loan principal" after "new budget

authority" in the first sentence and in paragraph (2);

(B) by striking out "and" after the semicolon at the end of paragraph ( 3) ;

(C) by striking out the period at the end of paragraph (4) and inserting in lieu thereof a semicolon and "and"; and

(D) by adding at the end thereof the following new paragraph:

" ( 5) an up-to-date tabulation comparing the gross obligations for the principal amount of direct loans and the commitments to guarantee loan pr1ncip3.l for such fiscal year in b1lls or resolutions on which the Congress has completed action to the gross obligations for the principal amount of direct loans and the commitments to guarantee loan principal set forth in the most recently agreed to concurrent resolution on the budget for such fiscal year and the reports submitted under section 302.".

(3) Section 308(c) (1) of such Act (as amended by section 4 (h) ( 3) of this Act) is furthe: amended-

( A) by striking out "and" after "budget authority" and inserting in lieu thereof a. comma.; and

(B) by inserting a. comma. and "total gross obligations for the principal amount of direct loans, and total commitments to guarantee loan principal" after "budget outlays".

(k) (1) Section 309 of such Act (as amended by section 4(1) of this Act) is further amended-

( A) by inserting "(a) Completion of Action Required.-" before "Except";

(B) by inserting "or specifying the level of gross obligations for the princi!Jal amount of direct loans or the level of commitments to guarantee loan principal for such fiscal year," after "such year," where it first appears 1n paragraph ( 1) ; and

(C) by adding at the end thereof the following new subsection:

"(b) LIMITATION ON ENROLLMENT.-B1lls and resolutions providing new budget authority for any 2-fiscal-year budget period or new spending :~.uthority described in section 401(c) (2) (C) for any 2-fiscal-year budget period shall not be enrolled until the concurrent resolution required to be reported under section 310(a) for such 2-fisca.l-year budget period has been agreed to, and if a reconc111ation b111 or reconc111ation resolution, or both are required to be reported under section 310(c) for such 2-fiscal-year budget period, until Congress has completed action on that b111 or resolution, or both.".

(2) The section heading for section 309 of suoh Act is amended by striking out "AND CERTAIN NEW SPENDING AUTHORITY" and inserting 1n lieu thereof a comma and "SPECIFYING DmECT LOANS OR COMMITMENTS TO GUARANTEE LOAN PRINCIPAL, OR PROVIDING NEW SPENDING AUTHORITY; LIMITATION ON ENROLLMENT OF CERTAIN BILLS AND RESOLUTIONS".

(3) The item relating to section 309 In the ta;ble of con teruts in section 1 (b) of the Congretsslonal Budget and Impoundment Control Aot of 1974 is amended by striking out "and certain new spending authority" and Inserting In lieu thereof a. comma and "specifying direct loans or commitments to guarantee loan principal, or providing new spending authority; Uml,ta.tion on enrollment of certain bUls and resolutions".

(1) Section 310(a) of the COngressional Budget Act of 1974 (as amended by section 4(j) (1) of this Act) is further a.mended

(1) by striking out "or" after the semicolon a,t the end of paragraph ( 3) ;

(2) by redesign~atlng paragra.ph (4) as para,graph ( 5) and (in such pa.ra,graph) striking out "and (3)" and inserting in lieu thereof "(3). and (4) ";

( 3) by inserting after paragraph ( 3) the following new paragraph:

" ( 4) specify the total amount by which gross obligations for the principal amount of direct loans and the total amount by which commitments to guarantee loan principal are

to be changed and direct the committees having jurisdiction to recommend such changes; or"; and

( 4) by inserting before the third sen teru::e the following: "It shall not be in order in the Senate or the House of Representatives to consider any such concurrent resolution whioh con ta.ins any matter other than the ma.tters described in the first two sentences of this subsection or which directs a.ny committee to determine and recommend changes in laws, b1lls, and resolutions authorizing the enaotment of new budget authority for any 2-fisca.l-year budget period.".

(m) Section 310(e) (2) of such Act is amended by striking out "20" and inserting in lieu thereof "100".

(n) (1) Section 3ll(a.) of such Act (as amended by section 4(k) of this Act) of 1974 is further amended-

( A) by inserting "specifying the level of gross obligations for the princi Jal amount of direct loans or the level of commitments to guarantee loan principal for such 2-fisca.lyear budget period," after "effective during such 2-fiscal-yea.r budget period," in the matter preceding paragraph (1): and

(B) by inserting "would cause the appropriate level of gross obligations for the principal amount of direct loans or the appropriate level of commitments to guarantee loan principal set forth in such concurrent resolution to be exceeded," after "exceeded," in the matter following paragraph (3).

(2) The section heading of section 311 of such Act is amended by inserting a. comma and "LOANS AND LOAN GUARANTEE COMMITMENTS," after "SPENDING AUTHORITY".

(3) The item relo.ting to section 311 in the table of contents in section 1 (b) of the Congressional Budget and Impoundment Control Act of 1974: is amended by inserting "loans and loan guarantee commitments," after "spending authority".

( o) Section 402 (a) of the Congressional Budget Act of 1974 (as amended by section 4 ( m) ( 1) of this Act) is further amended by inserting "or which authorizes the guarantee of the repayment of indebtedness incurred by another p£-rson or government for a 2-fisca.l-year budget period," after "for a. 2-fiscal-year budget period," .

(p) (1) Title IV of such Act is amended by adding at the end. thereof the following new sections: "LEGISLATION PROVIDING AUTHORITY TO MAKE

DIRECT LOANS OR TO GUARANTEE THE REPAYMENT OF INDEBTEDNESS "SEc. 405 It shall not be in order in either

the House of Representatives or the Senate to consider any bUl or resolution wh~ch provides, extends, or enlarges authority to incur obligations for the principal direct amount of loans or guarantee the repayment of indebtedness incurred by another person or government (or any amendment which provides, extends, or enlarges such authority) unless that b1ll , resolution, or amendment also provides that such authority is to be effective for any fiscal year only to such extent or in such amounts as are provided in appropriation Acts.

"REPORTS "SEc. 406. (a) (1) The reports required by

sections 301(c), 302(b), 308(b), and 308(c) shall contain the tables described in subsection (b) .

"(2) Any-"(A) concurrent resolution on the budget

reported by the Committee on the Budget of the Senate or the House of Representatives under section 301, 304, or 310 of this Act· and '

"(B) bill or resolution reported by a committee of the Senate or the House of Representatives which provides, modifies, or terminates budget authority or spending a.uthori ty desert bed in section 401 (c) ( 2) (c) • or which contains or modifies estimates of budget outlays,

• I


shall be accompanied by a report containing the tables described in subsection (b). The conference report on any bill or resolution described in clause (A) or (B) of the preceding sentence shall be accompanied by a joint statement of the managers containing such tables.

" (b) ( 1) The tables required by subsection (a) shall set forth estimates of budget authority, spending authority described in section 401(c) (2) (C), and budget outlays for each of the accounts (to which the report, bill, or resolution referred to in such subsection pertains) which are set forth in the Budget Accounts Listing contained in the Budget of the United States Government submitted by the President pursuant to section 201(a) of the Budget and Accounting Act, 1921, during the Congress in which the report referred to in subsection (a) ( 1) is made or the bill or resolution described in subsection (a) (2) is reported. If any such report, b1ll, or resolution contains provisions involving budget authority, spending authority, or outlays for which accounts have not been included in such Budget Accounts Listing, the estimates therefor in the table required by this subsection shall be set forth in account records with account identification codes assigned by the Director of the Congressional Budget Office.

" ( 2) The tables described in paragraph ( 1) which are required to be included in the reports required by sections 301 (c) , 302 (b) , 308 (b) , and 308 (c) , and in the reports accompanying any concurrent resolution on the budget reported under sections 301, 304, and 310 shall also set forth estimates for the budget authority and spending authority described in section 401 (c) (2) (C) which will become available without further congressional action and estimates of the outlays that wm result from such budget authority and spending authority. With respect to the reports required by sections 301 (c) and 302 (b). the estimates described in the preceding sentence are only required for the accounts or portions of accounts relating to the subject matter within the legislative jurisdiction of the committee submitting the report.".

(2) The table of contents in section 1 (b) of the Congressional Budget and Impoundment Control Act of 1974 is amended by insert!.r:g after the item relating to section 404 the following new items: "SEc. 405. Legislation providing authority

to make direct loans or to guarantee the repayment of indebtedness.

"SEc. 406 . Reports.". (q) ( 1) Section 606 of the Congressional

Budget Act of 1974 is repealed. Section 607 of such Act (as amended by section 4 ( o) of this Act) is redesignated as section 606.

(2) The .table of contents in section 1 (b) or the . Congressional Budget and Impoundment Control Act of 1974 is amended by striking out the item relating to section 606 and redesignating the item relating to section 607 as the item relating to section 606.

(r) ( 1) Section 802 of the Congressional Budget Act of 1974 is amended to read as follows:

''BUDGET ACCOUNTS

"SEc. 802. The Budget of the United States Government submitted pursuant to section 201 of the Budget and Accounting Act, 1921. for the 2-fiscal-year budget period beginning on October 1. 1984, and the estimates of outlays and proposed budget authority required to be submitted under section 605 of this Act for such 2-fiscal-year budget period. shall be set forth In the same accounts which are set forth in the Budget Accounts Listing contained in the Budget of the United States Government submitted for fiscal year 1982 under section 201 (a) of the Bud~?et and Accounting Act. 1921. Any change in the

accounts used in the Budget of the United States Government submitted under section 201 (a) of the Budget and Accounting Act, 1921, for the 2-fiscal-year budget period beginning on October 1, 1984, or any succeeding 2-fiscal-year budget period or in the estimates of outlays and proposed budget authority required under section 605 of this Act for any such 2-fiscal-year budget period, from the accounts set forth in the Budget Accounts Listing contained in the Budget submitted under section 201 (a) of the Budget and Accounting Act, 1921, for fiscal year 1982 or the preceding 2-fiscal-year budget period, as the case may be, shall be made only in consultation with the Committees on Appropriations, the Committees on the Budget, and the committees having legislative jurisdiction over the programs or activities which will be affected by such changes. The provisions of this section shall not prohibit the inclusion of new accounts in the Budget Accounts Listing contained in the Budget submitted pursuant to section 201 (a) of the Budget and Accounting Act, 1921, solely for purposes of presenting estimates for new programs.".

(2) The item relating to section 802 in the table of contents in section 1 (b) of the Congressional Budget ~nd Impoundment Control Act of 1974 is amended to read as follows: "SEc. 802. Budget Accounts.". AMENDMENTS TO BUDGET AND ACCOUNTING ACT,

1921

SEc. 6. (a) ( 1) So much of section 201 (a) of the Budget and Accounting Act, 1921 (31 U.S.C. 11 (a)), as precedes paragraph ( 1) thereof is amended to read as follows:

"(a) The President shall transmit to the Congress, by January 10 of the first session of each Congress beginning with the Ninetyeighth Congress, the Budget for the 2-fiscalyear budget period (as defined in section 3 (6) of the Congressional Budget and Impoundment Control Act of 1974) beginning on October 1 of the succeeding calendar year. The Budget transmitted under this subsection shall include a proposed Budget for each of the two fiscr.l years in such period, the President's Budgt:>t Message. summary data and text, :m'i supporting detail. The Budget shall set forth in such form and detail as the President may determine (with respect to each fiscal year in such 2-fiscalyear budget period)-".

(2) Section 201 (a) (5) of such Act is amended by striking out "the ensuing fiscal year and projects for the four fiscal years immediately following the ensuing fiscal year" and inserting in lieu thereof "each such fiscal year and projections for the four fiscal years immediately following the second fiscal year in such 2-fiscal-year budget period".

(3) Section :101(a) (6) of such Act is amended by striking out "the ensuing fiscal year and projections for the four fiscal years immediately following the ensuing fiscal year" and inserting in lieu thereof "each such fiscal year an:i projections for the four fiscal years immediately following the second fiscal year in such 2-fiscal-year budget period".

(4) Section 201 (a) (9) of such Act is amended by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscal-ycar budget period".

(5) Section 201(a) (12) of such Act is amended-

. (A) by striking out "fiscal year" in subparal!raph (A) and inserting in lieu thereof "2-fiscal-year budget period";

(B) by striking out "each of the four fiscal years. immediately following that ensuing fiscal year" in subparagraph (B) and inserting in lieu thereof "each of the four fiscal years immccUately following the second fiscal year in such 2-fiscal-year budget period"; and

(C) by striking out "and" after the semicolon in subparagraph (B).

(6) Section 201(a) (13) of such Act is amended-


(B) by strikinJ out the period at the end thereof and inserting in lieu thereof a semicolon and "and".

( 7) Section 201 (a) of such Act is further amended by adding at the end thereof the following:

" ( 14) all essen-..ial facts regarding direct lending by the GovHnment, and guarantees by the Government ot' the repayment of indebtedness incurred by another person or government.

By January 10 of the second session of each such Congress the President shall transmit to the Congress any revision he may desire to make in the Budget transmitted in the first session of that Congress.",

(b) Section 201 (b) of such Act is amended by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscal-year budget period".

(c) Section 201 (c) of such Act is amended-

( 1) by striking out "the first four fiscal years" in paragraph (1) and inserting in lieu thereof "each fiscal year in the first four 2-fiscal-year budget periods";

(2) by striking out "ensuing fiscal year" in such paragraph and inserting in lieu thereof "ensuing 2-fiscal-year budget period";

(3) by striking out "fiscal years" in paragraph (2) and inserting in lieu thereof "2-fiscal-year budget periods"; and

( 4) by striking out "ensuing fiscal year" each place it appears in such paragraph and inserting in lieu thereof "ensuing 2-fiscalyear budget period".

(d) Section 201 (d) of such Act is amended-

( 1) by striking out "fiscal year" and inserting in lieu thereof "2-fiscal-year budget period";

( 2) by inserting a comma and "for each fiscal year in such 2-fiscal-year budget period," after "separately"; and

(3) by striking out "items enumerated in section 301(a) (1)-(5)" and inserting in lieu thereof "items enumerated in section 301 (a) (1)-(8) ".

(e) Section 201 (e) of such Act Is amended-

( 1) by striking out "each fiscal year" and inserting in lieu thereof "each 2-fiscal-year budget period"; and

(2) by striking out "such fiscal year" and inserting in lieu thereof "each fiscal year in such 2-fiscal-year budget period".

(f) Section 201 (f) of such Act is amended-

( 1) by striking out "fiscal year" in the matter preceding paragraph ( 1) and inserting in lieu ther~of "2-fiscal-year budget period";

(2) by striking' out "completed fiscal year" in paragraph ( 1) and inserting in lieu thereof "completed 2-fiscal-year budget period";

(3) by striking out "such fiscal year" in such paragraph and inserting in lieu thereof "each fiscal year of such 2-fiscal-year budget period"; and

( 4) by striking out "fiscal year" in paragraph ( 2) and inserting in lieu the reo! "2-fiscal-year budget period";

(5) by striking out "such year" each place it appears in such paragraph and inserting in lieu thereof "each fiscal year of such 2-fiscalyear budget period"; and

(6) by striking out "year" each place it appears in paragraph (3) and inserting in lieu thereof "years".

(g) Section 201(g) of such Act is amended-

( 1) by striking out "the ensuing fiscal year" in the first sentence and inserting in


lieu thereof "each fiscal year of the ensuing 2-fiscal-year budget period"; and

(2) by striking out "fiscal year" each place it appears in the last sentence and inserting in lieu thereof "2-fiscal-year budget period".

(h) Section 201 (h) of such Act is amended by striking out "fiscal year" each place it appears and inserting in lieu thereof "2-fiscalyear budget period".

(i) Section 201 (i) of such Act is amended-

( 1) by striking out "each fiscal year" and inserting in lieu thereof "each 2-fiscal-year budget period"; and

(2) by striking out "fiscal year ending September 30, 1979" and inserting in lieu thereof "2-fiscal-year budget period beginning October 1, 1984".

(j) Section 201 or such Act is further amended by adding at the end thereof the following new subsection:

"(k) Notwithstanding any other provision of law, the President shall include in the Budget submitted under subsection (a) proposed budget authority, direct loans, and commitments to guarantee loan principal, and estimates of outlays and receipts for all activities of all departments, establishments, and instrumentalities of the Federal Government, except Government-sponsored corporations to the extent financed by wholly private funds.".

( k) Section 206 of such Act is amended by inserting immediately before the period a comma and "or at the request of a committee of either House of Congress. Such estimates, requests, and recommendations submitted pursuant to a request of either House of Congress or a committee of either House of Congress shall not be submitted until after the day on which the President transmits the Budget to the Congress under section 201 of this Act for the 2-fiscal-year budget period". AMENDMENTS TO THE LEGISLATIVE REORGANIZA

TION ACT OF 194 6

SEc. 7. Section 136 of the Legislative Reorganization Act of 1946 is amended to read as follows:

"SEc. 136. (a) In order to assist the Senate and the House of Representatives ln-

.. ( 1) their analysis, appraisal, and evaluation of the application, administration, and execution of the laws enacted by the Congress. and

"(2) their formulation, consideration, and enactment of such modications of or changes in those laws. and of such additional legislation, as may be necessary or appropriate, each standing committee of the Senate and the House of Representatives (except the Committees on Appropriations, the Committees on the Budget, the House Committee on House Administration. the House Comm ittee on Rules. and the Bouse Committee on Standards of Official Conduct) shall review and study, on a continuing ba.sis, the application, administration. and execution of those laws, or parts of laws, the sub.1ect matter of which is within the jurisdiction of that committee.

" (b) During the period beginning on the 15th day after the Congress meets in each odd-numbered year and ending October 1 of the following even-numbered year, each standin~ committee of the House of Representatives and the Senate. to which subsection (a) applles, shall review and study-

.. ( 1) the application, administration. execution. and effectiveness of those laws 1 o,. parts of laws) the subject matter of which is within the jurisdiction of that committee, and

"(2) the organization and operation of the Federal agencies and entitles having resoonslb11ities in or for the administration and execution thereof, in order to determine whether such laws and the programs thereunder are being imple-

mented and carried out in accordance with the intent of the Congress and whether such programs should be continued, modified, or eliminated. In addition, each such committee (during such period) shall review and study any conditions or circumstances which may indicate the necessity or desirability of enacting new or additional legislation within the jurisdiction of that committee (whether or not any bill or resolution has been introduced with respect thereto). The findings and determinations made by each such committee as a result of its oversight activities under this section in any year shall be reported to the House of Representatives or the Senate no later than October 1 of such even-numbered year, and shall constitute the basis for such committee's legislative work during the succeeding Congress.

" (c) To a.ssis t a standing committee in carrying out its responsibilities under this section, the head of each Federal agency which administers the laws or parts of laws under the jurisdiction of such committee shall provide to each legislative committee of the Senate and the House of Representatives having legislative jurisdiction over such program such studies, information, analyses, reports, and assistance as the committee may request.

"(d) (1) Upon request made by the chairman of a committee of the Senate or House of Representatives or a joint committee - of Congress, the head of any agency shall furnish, without charge, to such committee or joint committee, computer takes or discs, together with explanatory documentation, containing information-

"(A) received, compiled, or maintained by the agency as part of the operation or administration of a program; or

"(B) specifically compiled pursuant to such a request in support of a review of a program.

"(2) The Committee on House Administration of the House of Representatives and the Committee on Rules and Administration of the Senate shall prescribe rules and regulations for their respective Houses which will minimize dupllcation of requests under paragraph ( 1) of this subsection.".

EFFECTIVE DATE

SEc. 8. The provisions of this Act and the amendments made by this Act shall take effect the first day of the 98th Congress, except that-

( 1 ) the amendments made by section 4 ( n) of this Act shall take effect on November 9, 1982; and

( 2) the provisions of section 8 of this Act shall take effect on the date of enactment of this Act.

FISCAL YEAR 1984

SEc. 9. (a) Notwithstanding the amendments made by sections 3, 4, 5, and 6 of this Act, the President shall submit to the Congress a budo:et for fiscal year 1984, and the estimates of outlays and prouosed budget authority that would have been reauired under section 605 of the Congressional Budget Act of 1974 (as such section was in effect on November 8, 1982). The provisions of section 201 (a) of the Budget and Accounting Act, 1921 (as such provisions were in effect on the day before the effective date of this Act), shall apply to the submission by the President of the Budget for fiscal year 1984. The provisions of se:::tion 605 of the Congressional Budget Act of 1974 (as such provisions were in effect on November 8, 1982) shall apply with respect to the submission of such estimates by the President.

(b) Notwithstanding the amendments made by sections 3. 4, 5, and 6 of this Act. the Congress shall complete action on the concurrent resolutior.J on the budget that would have been reauired for fiscal year 1984 under the provisions of the Con~ressional

Budget Act of 1974 as such provisions were

in effect on the day before the effe::tive date of this Act. The provisions of the Congressional Budget and Impoundment Control Act of 1974 (as such provisions were in effect on the day before the date of enactment of this Act) shall apply with respect to concurrent resolutions on the budget for fiscal year 1984, bills and resolutions providing new budget authority or new spending authority for fiscal year 1984, and bills and resolutions authorizing the enactment of new budget authority for fiscal year 1984, except that-

( 1) the provisions of section 301 (b) of such Act (as such provisions were in effect on the day before the effective date of this Act) shall not apply with respect to fiscal year 1984;

(2) it shall not be in order in the Senate or the House of Representatives to consider any first concurrent resolution on the budget for fiscal year 1984 required by section 301 of such Act (as such section was in effect on the day before the date of enactment of this Act) if such concurrent resolution includes any matter other than the matters described in paragraphs ( 1) through ( 6) of subsection (a) of such section;

( 3) it shall not be in order in the Senate or the House of Representatives to consider any concurrent resolution on the budget under section 304 of such Act (as such section was in effect on the day before the date of enactment of this Act) revising a concurrent resolution on the budget for fiscal year 1984 which is adopted before the adoption of the second concurrent resolution on the budget required for such fiscal year under section 310 of such Act (as such section was in effect on the day before the date of enactment of this Act) if a concurrent resolution making such revisions includes e.ny matters other than the matters described in paragraphs ( 1) through ( 6) or section 301 (a) of such Act (as such section was in effect on thE> day before the date of enactment of this Act);

(4) it shall not be in order in the Senate or the House of Representatives to consider any concurrent resolution on the budget under section 304 of such Act (as such section was in effect on the day before the date of enactment of this Act) revising the second concurrent resolution on the budget required for fiscal year 1984 under section 310 of such Act (as such section was in effe~t on the day before the date of enactment of this Act) or any concurrent resolution on the hudget adopted after the second concur1ent 1 esolution if the concurrent resolution m a king such revisions includes any matter other than the matters described in paragraphs ( 1) through ( 6) of section 301 (a) of such Act (as such section was in effect on the day before the date of enactment of this Act) and paragraphs ( 1) through ( 4) of section 310(a) of such Act (as such section was In effect on thE: day before the date of enactment of this Act);

(5) b1lls and resolutions rroviding new budget authority for any fiscal year or new spending authority described in section 401 (c) ( 2) (C) of s uch Act for fiscal year 1984 shall not be enrolled until the concurrent resolution required to be rePorted under ~ection 310(a) of such Act (as such section was in effe~t on the day before the date of enactment of this Act) for such fiscal year has been agreed to, and if a reconciliation bill or reconciliation resolution, or both , are required to be repor ted under section 310(c) of such Act (as such section was in effect on the day before the date of enactment of this Act) for s uch fis cal year. until Congress has comoleted action on that bill or resolution , or both;

(6) it shall not be in order in the Senate or the House of Representatives to consider any concurrent resolution on the bud~et required under section 31Q(a) of such Act (as such section was in effect on

22506 CONGRESSIONAL RECORD-SENATE September 30, 1981 the day before the date of enactment of tr.i3 Act) which contains any matters other than the matters described in the first two ~entences of such section or which directs any committee to determine and recommended changes in laws, bills, and resolutions authorizing the enactment of new budget authority for fiscal year 1984;

(7) section 405 of such Act, as added by section 5 (p) of this Act, shall apply with l'espect to fiscal year 1984; and

( 8) section 802 of such Act, as amended by section 5(r) of this Act, shall apply with respect to fiscal year 1984.

SECTION-BY-SECTION ANALYSIS

Section 2 sets forth the purposes of the bill-to revise the work schedules for Congressional budget and program review activities so as to provide adequate time for thorough consideration of costly and complicated Federal programs.

Section 3 revises the timetables for the Federal budget process to provide for a biennial process in place of the current one-year proces3. Presidential estimates would be submitted for periods of two fiscal years; concurrent resolutions on the budget would be for two years; and appropriations and other spending bills would provide budget authority for two fiscal years. Within a two year period for considering and enacting a budget, the following activities would occur in the first session of a Congress:

President submits estimates to Congress; Congressional Budget Office submits esti

mates to the Budget Committees; Committees submit Views and Estimates

Reports to the Budget Committees; Legislation authorizing the enactment of

new budget authority is reported (by June 1) and Congressional action is completed (by October 1);

Congress completes action on the required first budget resolution (by August 1);

Committees report their suballocations among programs within their jurisdictions of the portions of the totals in the first budget resolution (by October 1) .

The focus of the first session is the first resolution and culminates in committees' ello~ations of the budget totals in the resolution among programs. A related provision. Section 5 ( p) ( 1) , prescribes a level of detail absent from such allocations now, so that they will be more meaningful statements and can serve as a. basis for preparing spending bills in the second session and for ascertaining if spending bills are consistent with the budget resolution totals and allocations.

In the second session, the focus is on the consideration and enactment of appropriations and other spending measures. A second budget resolution provides a vehicle for adjusting the overall totals to reflect changes in economic conditions. changes in priorities within major functional categories, and for reconciling differences between the spending bills and overall budget totals. Spending bills are withheld from enrollment until completion of action on the second budget resolution and reconciliation, if any. In recognition of the use of reconc111ation to make extensive and substantial chan<?es, more time is provided for their preparation and consideration (August 1 to Seutember 25 instead of the 10 day period, Seutember 15 to 25) . A related provision. Section 5 ( m), increases the time for debate in the Senate from 20 to 100 hours, again in re~ognition of the fact that many substantive issues can be incorporated in a single reconciliation bill, which can require more deliberation than is possible in 20 hours.

Throughout the timetable, events have been arranged so that offices responsible for an action have time to use the results of prior, related actions. For example, Views and Estimates Reports ~.re made due two

months before the reporting date for the first budget resolution. Similarly, authorizations for appropriations are to be complete::! in the first session with appropriations not reported until the secon::l ses3ion.

Section 4 makes changes throughout the Budget Act conforming to the revised timetable in Section 3. Also, 5-year projections of budget estimates are changed to 6-years to conform to the 2-fiscal-year periods.

Section 5 makes changes to the Congressional Budget Act to expan::l the coverage and improve the discipline of the con6ressional budget process and to correct conditions which have developed from e!Torts to improvise stronger enforcement within the current provisions of the Act.

1. Federal credit programs are made subject to inclusion in the President's budget requests, in budget resolutions and 1!1 other budget reports. (Numerous se::tions throughout the blll.)

2. A point of order is provided against the consideration of a. first concurrent resolution or a. revision thereto containing any matter other than that specifically enumerated in Section 301 (a) of the Budget Act. (Sections 5(e) and 5(h)).

3. Appropriations and other spending measures are not to be enrolled prior to complation of action on the required second resolution and reconciliation blll or resolution, if any. This is to correct the problem which now can arise from the consideration and enactment of spending measures through a several month time period, some of which individually exceed the amounts "assumed" in the budget resolution, with the result being that "room" in the budget intended for other programs is preempted, thereby causing irresistible pressure to increase the totals. Under this procedure all bllls would be held and all would be equally subject to adjustment in reconc111ation. None would have enacted status; and none should, therefore, be regarded by agencies and the public as completed and used as a basis for commitments. This procedure wlll help reduce the need for Budget Committee chairmen to challenge bills on the Floor which are thought to exceed assumptions in the budget resolutions, which has sometimes led to disagreements over what was assumed, over the status of such assumptions, over committee prerogatives to differ from the assumptions, and over the role of the Budget Committee with respect to such details. A related change, Section 5(p) (1), by requiring greater specificity in committee allocation reports and in reports accompanying spending measures will also make it easier to see whether or not any bill is within the amounts in a committee's own allocation report and, therefore, within the totals allocated to the committee in the statement of managers accompanying the conference report on a budget resolution. (Section 5(k) (1) (C)).

4. A point of order is provided against budget resolutions containing instructions to Committees to make changes in program authorizations. This is in keeping with the express intent of the 1974 Budget Act, as stated in the legislative history, that budget resolutions, reconc111ation instructions, and re<:onciUation bllls and resolutions, not apply to authorizations. (Section 5(1) (4)).

5. The time for debate of a reconc111ation blll or resolution in the Senate is increased from 20 to 100 hours. (Se<:tion 5(m)).

6. Certain tabular d·ata. is required for budget reports and reports accompanying budget resolutions and spending measures. Views and Estimates Reports, committees' allocations of first resolutions budget totals, CBO b1ll cost estimates, budget resolutions, and spending measures are to include or be accompanied by reports including tables in which the budgetary aspects of the report or measure are set forth in the same accounts used by the President in his budget

estimates transmitted in January of the ru·.,~ Bc:S.SlOn vi the Congress. (Section 5(p) ( 1) ) . The purpose of this provision is to fac111tate a ready comparison of the measures and reports to not only the President's estimates but to all other related documents throughout a budget cycle; that is, to provide a common language through which the recommendations and decisions can be expressed. In a related provision, the President is required to use the same account structure in both his current services estimates submitted in November and in the January budget recommendations, and is required to consult with the Budget Committees, the Appropriations Committees, and the authorizing committees on changes in the account structure from one fiscal period to another. The combined effects of these provisions are to provide a measure of stab111ty in the form in which the budget is presen ted so that Congressional offices need not wast~ time figuring out a new structure, and for congressional decisions to be made within a consistent information structure so as to fac111ta.te understanding beyond the circle of those most intimately involved in the process.

Flexib111ty in the presentation of new programs is provided through allowing the President's January budget to include new accounts not in the current services budget solely for the purpcse of presenting new programs. Similarly, committees are permitted to use interim account numbers to report new programs. Account identification codes for such accounts are to be assigned by the Congressional Budget Office as a central reference point to maintain consistency in the account structure.

7. Section 606 of the Budget Act, which requires the Budget Committees to study and report on off-budget agencies is repealed. (Section 5 ( q) ( 1)). A related provision, Sectio:l 6(j). amends the Budget and Accounting Act, 1921, to require that an off-budget agencies, except government-sponsored corporations to the extent financed by wholly private funds, be included in the budget totals in the President's budget estimates. Additional amendments authorizing or directing the Budget Committees to include such agencies in budget resolutions are not considered necessary.

8. Related to item 6 above, the President is required to use the same account structure in his January estimates and his current services estimates submitted the preceding November, and account changes from one fiscal period to another are required to be made only in consultation with the Appropriations, Budget t&Ild authorizing committees. (The Budget Account Listing in the fiscal year 1982 Budget is designated as the beginning reference point.) This is an extension of the present provision which covers only the major functional categories and which requires consultation only with the Budget and Appropriations Committees. The change is a reflection of the increased involvement of authorizing committees in the details of the budget since the enactment of the Congressional Budget Act of 1974. Expansion of this provision is also a reaffirmation of the need for current services estimates to be submitted prior to the submission of the January estimates in order to provide a planning base to authorizing committees, which have the earliest action in the congressional budget process and therefore the greatest need for current services estimates in November. (Section 5(r) .)

Section 6 makes changes in the Budget and Accounting Act, 1921, consistent with the two-fiscal-year budget process, and corresponding to the timetable in section 3.

Additionally, Section 6(j) requires that current off-budget agencies, except government-sponsored corporations to the extent financed by wholly private funds, be included


in the budget totals in the President's budget estimates.

Also, Section 6(k) provides that committees can request and receive information on agencies' budget requests. The language of the existing provision is thought by some to limit such requests to the full House of Representatives or Senate. The prohibition against release by agencies of such information prior to the release of the President's estimates is retained.

Section 7 modifies and strengthens the legislative oversight requirements set forth in Section 136 of the Legislative Reorganization Act of 1946 to-

1. change the dates for committees to submit oversight activity reports from March 31 of the first session of a succeeding Congress to October 1 of the second session of the Congress in which the activities are performed;

2. specify that the oversight activity report for a committee is to provide the basis for the committee's legislative activity in the succeeding Congress;

3. require agencies to provide assistance to committees in the review of Federal programs and to provide information on computer tapes or discs, without charge, on request of a chairman of a committee of either House or of a joint committee. This is intended to clarify that existing laws requiring agencies to assess user charges on individuals and organizations to which information is supplied on computer tapes and discs do not apply to the Congress. It is expected that the common practice of exchanging computer tapes or copying the information from and returning agencies' tapes would be followed. Additionally, the House Committee on House Administration and the Senate Committee on Rules and Administration are to prescribe rules for their respective Houses which will minimize duplication of such requests.

Section 8 sets forth the effective dates, which are-

The first day of the 98th Congress, for the 2-fiscal-year budget process, except for the provision requiring the first 2-fiscal-year current services budget;

November 9, 1982, for the first 2-fiscal-year current services bude:et, which is to be submitted November 10, 1982, the year preceding th"' 98th Cone:ress: and

The date of enactment, for the amendments to the Legislative Reorganization Act of 1946, revising legislative oversight requirements.

Section 9 contains provisions for the transition from a 1-fiscal-year to a 2-fiscal-year budget process. During the first session of the 98th Congress, two processes will take place, the First Session activities for the development of the first 2-fiscal-year budget, for fiscal years 1985 and 1986, and the enactment of the budget for the last 1-fiscal-vear budget, for fiscal year 1984. Section 9 specifies that the budget for fiscal year 1984 is to be considered as if these amendments were not in effect, except that certain procedural changes made part of the 2-fiscal-year process are also by this Section made specifically applicable to the consideration of the fiscal year 1984 budget. These are-

1. A point of order is provided against the required first budget resolution or revisions thereof containing any matter not specified in the enumeration of the contents of a required first resolution.

2. Appropriations and other spending measures are not to be enrolled until action is completed on the required second resolution and the reconc111ation blll or resolution, if any.

3. A point of order is provided against a required second resolution containing instructions with respect to authorizations for the enactment of new budget authority.

4. Views and Estimates Reoorts, committees' suballocations of budget resolution

totals among programs, CBO bill cost estimates, budget resolutions, and appropriations and other spending measures are required to contain, or be accompanied by reports containing, tables in which the budgetary information is set forth in the same account records used in the President's January budget estimates.

5. The President's current services estimates and January budget estimates are required to be in the same account structure as that used in the fiscal year 1982 Budget, except for changes made in consultation with the Appropriations, Budget, and authorizing committees.

SUMMARY OF BUDGET AND OVERSIGHT IMPROVEMENT AMENDMENTS OF 1981

1. Establish a two year budget process. This would allow many deficiencies in the current process to be corrected, such as inadequate time for committees to prepare views and estimates reports and for the Budget Committee to consider them; and inadequate time for compliance with reconc111ation instructions and consideration of reconc111ation bllls.

2. Specifically limit reconc111ation to the second budget resolution, as was originally intended by the Budget Act; and provide a point of order against resolutions other than the required second resolution if they contain reconc111ation instructions.

3. Specifically limit reconc111ation instructions to spending laws and bills, again, as was originally intended by the Budget Act; and provide a point of order against reconcmation instructions which refer to other than spending bills or laws.

4. Withhold enrollment of new spending bills until after completion of action on the second resolution and reconc111ation. This ts necessary to prevent early bills from taking up the "room" in the budget and creating a situation where later "must" legislation creates irresistible pressure to break through the ce111ngs.

5. Include loan guarantees and off-budget activities in the budget. The present practice understates the budget and allows some government activities to escape the discipline of the budget process.

6. Stab111ze the budget account structure and use it as a standard basis for budgetrelated reports so no more time will have to be wasted reacting to a new structure each year and so that the precise effects of budgetrelated b1lls and reports will be more readily apparent.

Mr. FORD. Madam President, I ask unanimous consent that the bill be held at the desk for 3 days so that other Senators may add their names as sponsors.

Mr. BAKER. Madam President, reserving the right to object, and I will not object, we have a problem with that. I do not like to cultivate the habit of having a bill lie at the desk for a long period of time for cosponsors. This is a special circumstance and I will not object to it.

The Senator and I have had discussions about the matter of referral of this bill and those matters have not yet been resolved, I do not believe, on either side of the aisle. This period will give us additional time to try to resolve that issue as well. In this case, I will not object to the bill lying at the desk for 3 days for further cosponsors.

Mr. FORD. Madam President, I thank the majority leader for his courtesy and understanding. I will not ask unanimous consent at this time that the bill be jointly referred but will withhold that for the 3 days that the bill be at the desk.

I am hopeful that this can be cleared on both sides and that I might be able to proceed with a unanimous-consent agreement for jo:nt referral.

Mr. BAKER. I thank the Senator from Kentucky. He is very considerate in that respect. I assure him I will work with him and the minority leader trying to clear the appropriate referral on this measure.

Mr. FORD. I thank the majority leader.

The PRESIDING OFFICER. The Chair would like to ask the Senator from Kentucky, Is this for 3 days of the session?

Mr. FORD. I do not want 3 legislative days. I want 3 calendar days. Today is Wednesday; so it would be Thursday, Friday, and Monday, if we are in session Friday. If we are not il: session Friday, it would be until Tuesday.

It would be calendar days, not legislative days. I would want to get it o1f the desk.

Mr. BAKER. I interpret that to mean 3 days of session.

The PRESIDING OFFICER. That is the understanding of the Chair.

Without objection, it is so ordered. Mr. FORD. I thank the Chair.

ORDER OF BUSINESS Mr. BAKER. Madam President, what

is the business before the Senate? The PRESIDING OFFICER. There is

one other special order for the Senator from West Virginia for a time not to exceed 5 minutes.

Mr. BAKER. Madam President, while we await his arrival or further instructions of the Senator from West Virginia, I ask that it be in order to suggest the absence of a quorum without charging it against the remaining special order.


Mr. BAKER. Madam President, I suggest the absence of a quorum.

The PRESIDING OFFICER. The clerk will call the roll.

The bill clerk proceeded to call the roll. Mr. BAKER. Madam President, I ask

unanimous consent that the order for the quorum call be rescinded.


Mr. BAKER. Madam President, on the advice of sta1f, I am informed that the distinguished minority leader cannot use his time under the special order in his favor at this moment. I ask unanimous consent that his time under the special order may be deferred until later in the day at his convenience.


ROUTINE MORNING BUSINESS Mr. BAKER. Madam President, is there

an order for morning business? The PRESIDING OFFICER. There will

now be a period for the transaction of routine morning business.

Mr. BAKER. Is there a time? The PRESIDING OFFICER. Yes, there

are 20 minutes, with a 3-minute limitation for speeches.

22508 CONGRESSIONAL RECORD-SENATE September 30, 1981 Mr. BAKER. Madam President, I ask

the distinguished Senator from Wisconsin <Mr. PROXMIRE > if he needs more than 3 minutes?

Mr. PROXMIRE. Madam President, does the Senator from Tennessee not know that I am always brief? Three minutes is plenty.

Mr. BAKER. Three minutes will be a remarkable contrast to 16% hours, Madam President.

THE IMPACT OF THE MAJOR POWERS ON INTERNATIONAL BEHAVIOR Mr. PROXMIRE. Madam President,

for many years I have urged this bodY to ratify the Genocide Convention. Despite the fact that 83 nations have ratified this convention, it will not be effective without the support of the major powers and especially the superpowers. Until we add our support to the Genocide Convention, it will lack the solid foundation necessary to have a constructive effect.

Of course, some critics see U.S. ratification as merely a symbolic gesture. But international law, with major power backing, can be an effective tool in channeling international behavior. Major power diplomacy was instrumental in developing international commercial and corporate law, international environmental laws, international labor laws, administrative law, the law of the seas, territorial laws, and the laws of war.

All of these international laws follow from the presumption that certain domestic activities infringe upon the international community. With the Nuremberg trials after World War II, these activities came to include the violation of fundamental human rights. The Genocide Convention protects the most fundamental of these rights: namely, the right to live.

This is why it is so crucial for this Nation, in particular, to ratify the Genocide Convention. As a superpower, we have done more than anyone else in preserving and developing the present world order. As a nation, we have championed the cause of basic human rights for over 200 years. We were instrumental in the original endorsement of the Genocide Convention by the United Nations. And we can be instrumental in its general acceptance throughout the world.

But first we ourselves must ratify this convention.

CRUSADING PIONEER SURGEON ALTON OCHSNER IS DEAD AT 85

Mr. LONG. Madam President, throughout my years of public service, I have met many men and women of great achievements. But rarely have I known one whose achievements were so diverse or reached such heights as those attained by Dr. Alton Ochsner of New Orleans.

n is my sad duty to report on the death of Dr. Ochsner. He died in New Orleans last Thursday at the age of 85.

Dr. Ochsner was a great medical man, teacher, civic leader, and patriot. He was a beloved husband and father, whose three sons followed him in the practice of medicine.

Dr Ochsner's accomplishments were many.

He was the leading spirit in the formation and development of the Ochsner Medical Institutions, which revolutionized the practice of medicine in the Gulf South. The Ochsner Medical Institutions are housed in a $100 million facility in which 180,000 patients are seen each year.

Dr. Ochsner performed some 20,000 surgical operations on persons ranging from laborers to movie stars and presidents of nations.

He was identified by many as the Nation's chief foe of cigarette smoking. As early as 1936 he began warning that smoking causes lung cancer.

His civic activities included serving as president of the International House in New Orleans, the Oordell Hull Foundation for International Education, and of the Information Council of the Americas.

He was a prolific and distinguished writer, having authored 6 books, 24 sections of books, and more than 500 articles in medical journals.

His professional activities included serving as president of the International Society of Surgery, the Pan Pacific Surgical Association, the International cardiovascular Society, ·the American College of Surgeons, the American Association of Thoracic Surgery, the Society of Vascular Surgery, and the American Cancer Society.

Honorary degrees came to Dr. Ochsner from 10 universities, including ones in Nicaragua, Spain, and Greece. Orders of merit were awarded him from Ecuador, Panama, Guatemala, and Venezuela.

As a teacher Dr. Ochsner influenced the careers of more than 3,000 medical students who took his courses. He wanted to be remembered most of all as a teacher.

Dr. Ochsner was an amazing man both professionally and personally who made great contributions to his city, State, Nation, and to all mankind. His life was dedicated to saving the lives of others.

It was to me a great personal honor to have counted Alton Ochsner among my friends, and I feel my own life was enriched by having known him.

Madam President, I wish to extend my deepest sympathy to Dr. Ochsner's widow, Jane, to his sons, Alton, Jr., John, and Mims, and to his daughter, Mrs. John Mann.

Madam President, I ask unanimous consent that a September 25.1981, article in the New Orleans Times-Picayune/ States-Item reporting on Dr. Alton Ochsner's death be printed in the RECORD.

There being no objection, the article was ordered to be printed in the RECORD, as follows: CRUSADING PIONEER SURGEON ALTON OcHSNER

Is DEAD AT 85 (By John Pope)

Dr. Alton Ochsner Sr., internationally known surgeon and anti-smoking crusader, died a.t 12:35 p.m. Thursday in the Jefferson Parish hospital he helped found. He was 85.

Dr. Ochsner, who underwent heart surgery earlier this month at Ochsner Foundation Hospital, died of old age, sa.id Thomas P. Gore, an Ochsner vice president. Gore said

that the doctor's respiratory, cardiovascular and renal syst6ms failed.

Dr. Ochsner was acclaimed as a surgeon and a. medical innovator, but he was modest about what he thought a doctor could do.

"Eighty-five percent of your patients will get well no matter what you do," he said, "and a few will die . The doctor can influence the outcome of maybe 10 percent."

During his long career, Dr. Ochsner tried to influence the outcome of as many cases as he could. He performed surgery until April 4, 1968-four days before his 72nd birthday. On that day, he went through 11 operations before laying down his scalpel for the last time.

He performed more than 20,000 operations-including, in 1934, the first lung removal in the South-and his long roster of patients included actor Gary Cooper, golfing great Ben Hogan, Argentine President Juan Peron and a. former president of Pana.ma.

But Dr. Ochsner's reputation reached beyond the operating room. His primary joy was teaching, and he had more than 3,000 students, including Dr. Michael DeBakey, the famous Houston heart surgeon.

In a telephone interview from Houston Thursday, DeBakey called his former teacher "one of the giants of surgery in this century" and said his death was "a. great, great loss."

On a broader educational level, Dr. Ochsner was one of the first to warn Americans about the health hazards of cigarette smoking. He began his antismoking crusade in 1936.

He also helped found the medical institution that bears his surname. Since its 1942 opening in a.n Uptown 'bullding near Touro Infirmary, the facility has expanded and now occupies a. $100 million complex at 1516 Jefferson Highway which serves 180,000 patients annually.

Dr. Ochsner was president of several p·restiglous organizations related to his work, including the American College of Surgeons and the American Cancer SOOiety. Besides such professional activities, he was Rex, king of Oa.miva.l, in 1948, and president of International House in 1962. He won The TimesPicayune Loving Cup in 1945. In 1980, Dr. Ochsner was named one of 13 fathers of the year in a. nationwide list, and received the George Washington Awa.rd from Freedoms Foundation.

In The States-Item's centennial issue in June 1977, Dr. Ochsner was named the newspaper's Man of the Century in medicine.

He was born Edward Wllliam Alton Ochsner on May 4, 1896, in Kimball, S.D., and received his undergradua-te degree in 1918 from the University of South Dakota. Two years later he earned his medical degree at Washington University in St. Louis.

Dr. Ochsner, who dropped his first two names, was an intern at the Barnes Hospital in St. Louis and a. surgical resident a.t Chicago's Augusta.na. Hospital under A. J. Ochsner, a. cousin who took an interest in Alton Ochsner's career because his own son did not go into medicine.

Acting on his cousins suggestion, Dr. Ochsner went to Europe in 1922 as a.n exchange surgical resident a.t the universities of Zurich and Frankfurt. While abroad, he wrote-in German-the first of more than 500 medical articles he was to publish.

When he returned to the United States, the young doctor opened a. surgical practice in Chicago with Dr. D. A. Orth. But after a year, he said, "I found myself driving 100 miles a day to visit patients. It was a waste of time. I liked what I was doing, but I knew by then that I wanted to teach."

Even though tt meant a loss of more than half his annual pay-from $11,000 to $5,000-he accepted an offer to Join the University of Wisconsin's surgical faculty. A year later, he succeeded the acclaimed Dr. Rudolph Matas as professor of surgery at Tulane University Medical School.

At Tulane, Dr. Ochsner instituted an eduqational method known a.s "the bull pen," in which a student had 30 minutes to ex-


amine a patient, diagnose his lllness and defend that judgment before his peers-and before his instructor.

This method of teaching resulted in scores of anecdotes. In a documentary on Dr. Ochsner, one of his former students recalled panicking because his patient spoke nothing but Cajun French. In another case, after hearing a student's diagnosis, Dr. Ochsner shouted, "Why? Why? Why?" and the doctor-to-be fainted .

"I don't know who was more scared, he or I," Dr. Ochsner later said of that incident. He justified this method of instruction by saying that a doctor has to learn to perform quickly and under stress.

He gained respect at Tulane, but his life there was not easy. Then, as now, Tulane's medical school was affiliated with Charity Hospital, and Dr. Ochsner ran into opposition early from hospital administrators, who were aligned with Huey P. Long's political machine.

At one point, Long wanted a friend of his put on the Charity staff, but Dr. Ochsner objected because he felt the man was not qualified, said Gertrude Forshag, who became his secretary in December 1929 and stayed with him for the rest of his life.

Because of this climate, Dr. Ochsner wrote a despairing letter in 1930 to a friend, asking about an opening at another medical school. He explained that hE:' was making the request because the political atmosphere at Charity Hospital made progress impossible.

Dr. Ochsner, who wrote the letter at work, planned to take it home to show his wife, and put it in the pocket of his coat, which he hung up while he made his rounds at Charity. Someone pilfered the letter and showed it to Long, who was so enraged that he had the young physician stripped of his affiliation with Charity. Until he could be reinstated there, Dr. Ochsner arranged with Tulane administrators to perform his surgery at Touro Infirmary in a lO-bed sector that became known as "the Tulane ward."

This was one of several incidents that led to the formation of the Louisiana State University Medical School.

Dr. Ochsner's banishment "was almost a blessing," said .Forshag, who explained that he used it for research and reading that he would have been unable to do if he had been continuing his Tulane duties.

During the 1930s, Dr. Ochsner began talking with Tulane colleagues about the possibility of forming a private clinic where they could combine their medical skills.

He and the four department heads who were interested in the idea-Drs. Edgar Burns, Guy Caldwell, Francis LeJeune and Curtis Tyrone-wanted Tulane to operate the fac111ty, but the university's administrators voted against the concept. Nevertheless, they let the doctors proceed on their own.

The idea continued to grow, and the doctors were able to get $500,000-the amount they figured they would need to open the clinic-from Hibernia National Bank by using no more collateral than their signatures after they had convinced Rudolf S. Hecht, chairman of the bank's board of directors, that it would be good for the city.

But not everyone was so enthusiastic. Many doctors still were wedded to the idea that a physician should practice alone, and some doctors even felt that Dr. Ochsner and his partners were traitors to their profession. On a spring day in 1941, a messenger dropped off a small leather bag at the home of each founder. Each bag contained 30 dimes and this message: "To help pay for your clinic. From the physicians, surgeons & dentists of New Orleans."

Nevertheless, plans for the clinic reached the point where the founding doctors had to name their fledging enterprise. New Orleans Clinic and Southern Clinic were suggested, but while Dr. Ochsner was in Ogden. Utah, on a professional trip, he received this tele-

gram from his colleagues: "The baby has a name: the Ochsner Clinic."

On January 2, 1941, Ochsner Clinic opened in a building across Prytania Street from Touro lnfirmary. At the end of World War II, it took over Camp Plauche, an Army medical fac111ty near the East Bank approach to the Huey P. Long Bridge. Because it was a series of one-story trame buildings connected by walkways, it acquired the nickname "Splinter Village."

In 1954, the medical facility moved to its present location, 1516 Jefferson Highway. In addition to the Ochsner Foundation Hospital, the complex- now known as the Ochsner Medical Institutions-also houses the Ochsner Clinic for outpatient treatment, the Richard W. Freeman Research Institute and Brent House Hotel for patients' fam111es and friends. Between .the buildings and the Mississippi River levee is a frequently used heliport for medical emergencies, and because of the high number of Spanish-speaking patients, interpreters are on duty.

The hospital houses an Ochsner innovation: a family waiting room near the operating area where a patient's relatives can walt in privacy-and comparative silence-until the doctor tells them the outcome.

At this modern fac111ty and at other hospitals, Dr. Ochsner continued to perform surgery until he was nearly 72. When he established the clinic, Alton Ochsner set 70 as the mandatory retirement age, but as a founder, he was able to bend the rule and continue operating for nearly two more years, said a spokesman for Ochsner Medical Institutions.

"The nurses all admired him for his daring ab111ty to take on cases that no one was doing at the time," said Julie Carnahan, the nursing supervisor of Ochsner Clinic's Surgery Department, who worked with Ochsner since March 1942.

Carnahan described him as a "court of last resort" for some patients and explained why: "He was the man who would do something 1f it had to be done. In the er.rly days, before antibiotics, 1f a patient had something that seemed hopeless like a brain tumor, he'd operate.

"He wasn't trying to be any miracle man, but he wasn't afraid. He felt that 1f he made the correct diagnosis, he would want to do the things that got the patient well. He'd tell people, 'If there's a reason for doing it, there's a reason for not putting it off.' That's the way he was."

Among his more dramatic moments in surgery were his use of a blowtorch in radical mastectomies, the first successful separation of Siamese twins-the daughters of Lafayette Mayor and Mrs. Ashton T. Moutonjoined at the sacrum, and the removal of the thyroid gland of Tomas Gabriel Duque, the former president of Panama. Dr. Ochsner performed the thyroidectomy in Panama at the req.uest of Secretary of State Cordell Hull, who asked him to operate because Duque had helped. the United States by engineering the overthrow of a pro-Nazi government.

Firsthand glimpses of most of Dr. Ochsner's surgical triumps generally were limited to the people in the operating room with him. But a closed-circuit television hookup let a room!ul of doctors-meeting for a national convention in a New Orleans hotelsee how well he could work under pressure.

The operation was a removal of a cancerous lung. It seemed routine, and Dr. Ochsner was pat.iently describing each step to his enthralled audience. But suddenly, blood started gushing from a pulmonary artery because the tumor had penetrated the artery, and Dr. Ochsner's dissection of the cancer had punctured the blood vessel.

The commentary stopped; the surgeon had to act quickly to save the patient's life. He squeezed the artery to halt the fiow of blood,

holding it with one hand while sutures were put in to close the artery wall. He won this race with death.

Lung cancer was a disease he observed as a medical student. One of his professors summoned his class to see a person with this disease because, the instructor said, "you may never encounter another lung cancer in your entire careers."

But in 1936, Ochsner saw nine lung cancer patients in Six months. By investigating their medical histories, he learned that each started smoking during World War I. This discovery, which led to more research into the link between cigarette smoking and health, was the start of his war against cigarettes.

Dr. Ochsner took his battle to the American Cancer Society and conviilJCed the board of directors to go on record in favor of a resolution-backed by evidence from intense research-that cigarette smoking causes cancer.

Although the fiercely conservative Ochsner rallled against government intervention in many facets of American life-including medicine-and opposed the Medicare program, he believed the federal government should take a stronger role in the war against smoking.

He preached his anti-tobacco gospel to anyone who would listen. While Juan Peron was president of Argentina, Dr. Ochsner was flown to Buenos Aires to examine the dictator's vascular ailment. The doctor recommended surgery and began to prepare for Peron's incognito visit to Ochsner Clinic, but the Argentine strongman was overthrown in the mid-1950s and banished to Spain before he could make the journey.

Dr. Ochsner, who visited his patient t.wlce in exile, told Peron he could avoid the operation by stopping smoking. The deposed despot took his advice.

One man whose life Ochsner saved on the operating table was Ben Hogan, the professional golfer. In 1949, while Hogan was recovering in a Texas hospital from injuries he suffered in an automobile accident, he developed blood clots in veins. Anti-coagulants were pre:;cribed to thin his blood, and they touched off massive internal bleeding.

AI ton Ochsner was summoned, a.nd was rushed to Texas in a B-29 bomber, where he was forced to sit in the only availaJble spot: the bombardier's seat.

To keep the clots from reaching the golfer's heart, Dr. Oohsner tied off the vena cava and gave Hogan medication to thicken his blood and stop the hemorrhaging.

On Hogan's recommendation, Gary Cooper came to Dr. Ochsner to repair a hernia-a task that had daunted doctors in four previous operations. The operation was vital, Cooper explained, because he had to be ready to ride horseback and perform some strenuous stunts in his next picture.

Working •at Touro, Dr. Ochsner repaired the hernia and cleared Cooper for the movie. The film was "High Noon," and Cooper won his second Academy Award for his performance.

Until he was in his ear-ly 80s, Ochsner maintained an intense daily routine. After arising at 4 a.m. and performing the Royal oa.nadian Air Force exercises-including as many as 100 pushups-he worked until midnight. At Ochsner Medical Institutions, he insisted on using stairs until advancing age, coupled wl•th arthritis in one knee, forced him to rely on elevators to get from floor to floor.

After Dr. Ochsner's last operation, colleagues gave him an abstract-looking collage made of gleaming surgioal instruments set against a wooden block. The proud physician hung it on a paneled wall in his office.

Among his fellow workers, Dr. Ochsner is remembered as the sort of ma.n who could inspire tremendous loyalty.

.


"Even when he was a. young man, he was so appreciative and very helpful, and he hasn't changed too much since he's gotten older," Carnahan said. "He taught me an awful lot. He taught me so much that I feel I could almost diagnose patients and almost presuppose what he's going to tell them. I don't, of course, but it makes me feel more confident, and I can help people more.

"He was the kindest man I've ever known. He had a. wonderful way with people and was very easy to know. He wasn't easily upset or frustra. ted. Everybody tried to please him, and everything went pretty well with him."

After he stopped his operating room work. Dr. Ochsner continued to make his rounds at the hospital, to treat patients--as many as four per day-and to keep up a. schedule of speaking engagements before medical and non-medical organizations. Among his favorite topics was the danger of communism in the Western Hemisphere; he was a. founder of the Information Council of the Americas, which spoke out against Communist inroads in Latin America.

In addition to writing more thar: 500 articles for medical journals, he wrote six books and 24 sections of books.

Dr. Ochsner received honorary degrees from 10 universities, including institutions in Nicaragua, Spain and Greece, and received orders of merit from Ecuador, Panama, Guatemala and Venezuela. These and other decorations and citations filled the walls in his and Forshag's otllces at Ochsner Medical Institutions, and others were displayed in stacks atop filing cabinets ringing his secretary's desk.

An honorary fellow of the royal colleges of surgeons of Ireland and of England, Ochsner was president of the International Society of Surgery, the Pan-Pacific Surgical Association, the International Cardiovascular Society, the American College of Association for Thoracic Surgery and the Society for Vascular Surgery. The Alton Ochsner Surgical Society, composed of surgeons he trained, was established in 1959.

Dr. Ochsner was married twice. His first wife, Isabel Lockwood Ochsner, whom he married just before he went to Europe in 1922, died in 1969. The couple had a daughter, Isabel Ochsner Mann, and three sons.

The sons became doctors. Dr. Alton Ochsner, Jr., is in private practice, Dr. John L. Ochsner is chairman of surgery at Ochsner, and Dr. Mims G. Ochsner is a urologist there.

In 1970. Dr. Ochsner married Jane Kellogg Sturdy of Los Angeles.

In an interview with the Journal of the American Medical Association, Dr. Ochsner said he had been blessed throughout his long life with "Presbyterian luck": "If you do the right thing, no matter what happens, it wlll turn out for the best."

"I believe in luck," he added. "The harder I work, the luckier I get."

Mr. ABDNOR. Madam President, I say to the Senator from Louisiana that the good doctor was born and reared in South Dakota. We are extremely proud of the great record he has established. We deeply regret his passing, because he made a great, great contribution to this Nation. We were very proud of him in South Dakota.

Mr. LONG. I am sure the Senator joins me in regretting his passing.

TAX RETURN DISCLOSURE Mr. GRASSLEY. Madam President,

the Internal Revenue Service recently announced their intent to request the authority under Internal Revenue Code section 6103 <k> 3 to disclose tax return information to correct misstatements of

fact by a taxpayer about his or her transactions with the Internal Revenue Service or information contained within the taxpayer's return. The purpose of this disclosure is to enable the Service to refute the claims of some tax protestors who allege they have successfully evaded tax without penalty or have been unfairly harrassed by the ms. Certainly, the system of voluntary compliance depends upon each taxpayer's perception that everyone pays his or her fair shares; however, I am troubled about the ramifications of disclosing return information on the personal freedoms of individuals, even if that disclosure is for a limited purpose.

While I agree with the premise that all citizens should pay their fair share of the cost of operating our Government, I am concerned that this new authority might infringe upon each individual's right to privacy. Justice Douglas in Griswold against Connecticut described the right to privacy as a constitutional right within the penumbra of other Bill of Rights guarantees, including the first amendment right of freedom of speech and association, the fourth amendment right of people to be secure in their "persons, houses, papers and effects against unreasonable searches and seizures" and the ninth amendment which reserves to the people all powers not specifically enumerated in the Constitution.

Whether or not the disclosure of return information unconstitutionally or improperly violates an individual's right to privacy, depends on the reason for the disclosure and the type of information to be disclosed. The rationale for the disclosure and the choice of relevent information to be disclosed are value judgments to be made by an administrator. I know of no reason the current ms Commissioner or his top level executives are unable to make these sensitive choices, but to give any agency such broad discretion in an area which would inhibit an individual's personal freedom seems to me unwise. The damage to an individual of an imprudent disclosure by the ms could result in irreparable harm. Congress should carefully scrutinize the transfer of this power.

The Joint Committee on Taxation should not approve such a request in my judgment for the following reasons. Congress should establish two sets of standards for disclosures under section 6103 <k> 3---one set governing what constitutes a permissible reason for disclosure of return information and a second set clearly setting forth the type of information the agency may disclose.

For the first set of standards, Congress should establish the specific reasons a taxpayer's return may be made public. Many taxpayers make misstatements of fact about their true tax liability for a variety of reasons, forgetfulness , bravado or an intent to encourage others to violate the law. The consequences of these misstatements vary in their degree of

. seriousness. Congress should clarify what type of factual misstatements should trigger disclosure of return information. The code section currently provides that the Service can disclose return information to refute misstatements of fact to

the extent necessary for tax administratlOn. This purpose is too broad and should be narrowed by congressional action.

The second set of standards should state what sort of return information is eligible for disclosure. All return information not relevent to law enforcement efforts should be off limits for disclosure.

The advantages of clear standards are numerous. Specific standards will shield an agency from constitutional challenge on the grounds that their actions are void because of the vagueness of the underlying statute. Also, standards will give Congress a yardstick by which to measure the actions of the Service.

The controversy brought about by the efforts of the IRS to publicize return information of certain taxpayers has emphasized one fact to me-the evolutionary character of our Tax Code. The Federal Government's need to collect revenue is not static; it continues to change as circumstances dictate. In this case, I am committed to insuring that whatever evolves is the result of a thorough and deliberate study by the legislative and executive branches of government. This matter is simply too important to leave it solely to the executive branch.

PROPOSED ARMS SALE Mr. DODD. Madam President, section

36(b) of the Arms Export Control Act requires that Congress receive prior notification of proposed arms sales under that act in excess of $25 million or, in the case of major defense equipment as defined in the act, those in excess of $7 million. Upon such notification, the Congress has 30 calendar days during which the sale may be prohibited by means of a concurrent resolution. The provision stipulated that, in the Senate, the notification of proposed sales shall be sent to the chairman of the Foreign Relations Committee.

In keeping with the committee's intention to see that such information is available to the full Senate, I ask unanimous consent to have printed in the REcORD at this point the notifications which have been received. The classified annex referred to in one of the covering letters is available to Senators in the office of the Foreign Relations Committee, room 4229 Dirksen Building.

There being no objection, the notifications were ordered to be printed in the RECORD, as follows: DEFENSE SECURITY ASSISTANCE AGENCY,

Washington, D.C., September 17, 1981. Hon. CHARLES H. PERCY, Chairman, Committee on Foreign Relattons,

U .S. Senate, Washington, D.C. DEAR MR. CHAIRMAN: Pursuant to the re

porting requirements of Section 36(b) of the Arms Export Control Act, we are forwarding herewith Transmittal No. 81-41, concerning the Department of the Air Force's proposed Letter of Offer to Tunisia for defense articles and services estimated to cost $65 million. Shortly after this letter is delivered to your otllce, we plan to notify the news media.

Sincerely, ERICH F . VON MARBOD,

Director .


TRANsMrrrAL No. 81-41 Notice of Proposed Issuance of Letter of

Offer Pursuant to Section 36(b) of the Arms Export Control Act (i) Prospective Purchaser: Tunisia. (11) Total Estimated Value:

In millions Major Defense Equipment• ------------ $40 Other ------------------------------- 25

Total -------------------------- 65 •As included in the U.S. Munitions List,

a part of the International Traffic in Arms Regulations (ITAR).

(111) Description of Articles or Services Offered: Four F-5F aircraft with spares, support, and training.

(iv) Military Department: Air Force (SCA).

(v) Sales Commission, Fee, etc., Paid, Offered, or Agreed to be Paid: None.

(vi) Sensitivity of Technology Contained in the Defense Articles or Defense Services Proposed to be Sold: None.

(vii) Section 28 Report: Included in report for quarter ending March 31, 1981.

(v111) Date Report Delivered to Congress: September 17, 1981.

PoLICY JUSTIFICATION T'UNISIA-P'-5 AIRCRAI'T

The Government of Tunisia has requested the purchase of four F-5F aircraft with spares, support, and training at an estimated cost of $65 mlllion.

This sale supports the foreign policy objectives of the United States by helping to provide a friendly country with the means to maintain its own defense.

Tunisia has no interceptor aircraft and no air defense capab111ty at present to oppose the potential threat from neighboring countries. Tunisia's acquisition of interceptor aircraft 1s one phase of a five-year armed forces modernization program announced by Tunisia. This wlll be a normal FMS program with production leadtime of approximately two years, allowing sufficient time to train maintenance and operations personnel.

The sale of this equipment wlll not affect the basic military balance in the region.

The prime contractor wlll be the Northrop Corporation of Hawthorne, California.

Implementation of this sale w111 require the assignment in Tunisia of approximately 15 additional U.S. Government personnel and four contractor personnel for approximately two years.

There will be no adverse impact on U.S. defense readiness as a result of this sale.

DEFENSE SECURITY AssiSTANCE AGENCY, Washington, D.C., September 1981.

Hon. CHARLES H. PERCY, Chairman, Committee on Foreign Relations,

U.S. Senate, Washington, D.C. DEAR MR. CHAIRMAN: Pursuant to the re

porting requirements of Section 36(b) of the Arms Export Control Act, we are forwarding herewith Transmittal No. 81~5 and under separate cover the classified annex thereto. This Transmittal concerns the Department of the Army's proposed Letter of Offer to the United Arab Emirates for defense articles and services estimated to cost $800 mlllion. Shortly after this letter is delivered to your office, we plan to notify the news media of the unclassified portion of this Transmittal.

Sincerely, ERICH F. VON MARBOD,

Director.

TRANSMITTAL No. 81~5 Notice of Proposed Issuance of Letter of Offer

Pursuant to Section 36(b) of the Arms Export Control Act

(i) Prospective Purchaser: United Arab Emirates.

(11) Total Estimated Value: In millions

Major Defense Equipment*---------- $103 Other ------------------------------ 697

Total----------------------------- 800 *As included in the U.S. Munitions List,

a part of the International Traffic in Arms Regulations (!TAR).

(111) Description of Articles or Services Offered: Seven Improved-HAWK batteries, 343 missiles, anc1llary equipment, and training.

(iv) M111tary Department: Army (UBH, OBA, and OAZ) .

(v) Sales Commission, Fee, etc., Paid, Offered, or Agreed to be Paid: None.

(vi) Sensitivity of Technology Contained in the Defense Articles or Defense Services Proposed to be Sold : See Annex under separate cover.

( v11) Section 28 Report: Included in report for quarter ending June 30, 1981.

(vlli) Date Report Delivered to Congress: September 17, 1981.

POLICY JUSTU'ICATION UNITED ARAB EMIRATE5-IMPROVED·HAWK

SURFACE-TO-AIR MISSILES The Government of the United Arab Emi

rates (UAE) has requested .the purchase of seven I-HAWK batteries, 343 missiles, anc11lary equipment, and training at an estimated cost of $800 m1111on.

This sale wm contribute to the foreign policy and national security objectives of the United States by enhancing the ability of the UAE to provide for its own defense. A strong and independent UAE, that is able to defend itself, contributes to the stab111ty of t·he Middle East. Enhancement of the UAE's defensive capabilities wlll be an important contribution to mutual interests in the region.

The addition of the I-HAWK air defense system w111 enable the UAE to respond to hostile aircraft threats upon its sovereign territory with organic air defense forces. This need was validated in the Air Defense Requirements Survey of the UAE conducted by the U.S. Government in 1980.

The sale of this equipment and support w111 not affect the basic m111t·ary balance in the region. The I-HAWK or similar air defense systems are currently deployed in most countries of the region.

The prime contractor is the Raytheon Corporation of Andover, Massachusetts.

The implementation of this sale will require the assignment of approximately 40 U.S. Government and contractor personnel to the UAE.

There wm be no adverse impact on U.S. defense readiness as a result of this sale.

DEFENSE SECURITY ASSISTA:qCE AGENCY, Washington, D.C., September 24,1981.



porting requirements of Section 36(b) of the Arms Export Control Act, we are forwarding herewith Transmittal No. 81-100, concerning the Department of the Army's proposed Letter of Offer to Turkey for defense articles and services estimated to cost $32 m1llion. Shortly after this letter is delivered to your office, we plan to notify the news media.

You wlll also find attached a certification as required by Section 620C(d) of the Foreign Assistance Act of 1961, as amended, that this action is consistent with Section 620C (b) of that statute.


Director.

TRANSMITTAL No. 81-100 Notice of Proposed Issuance of Letter of

Olfer Pursuant to Section 36(b) of the Arms Export Control Act ( i) Prospect! ve Purchaser: Turkey. (11) Total Estimated Value:

In millions Major Defense Equipment*------------ $27 Other ---- _ _____ _ __ ______ __ _ __ ______ _ 5

Total -------------------------- 32 • As included in the U.S. Munitions List, a

part of the International Traffic in Arms Regulations (!TAR).

(111) Description of Articles or Services Offered: Fifteen UH-1H helicopters with concurrent spare parts, anclllary equipment, and support.

(iv) M111tary Department: Army (UMG). (v) Sales Commission, Fee, etc., Paid, Of

fered, or Agreed to be Paid: None. (vi) Sensitivity of Technology Contained

in the Defense Articles or Defense Services Proposed to be Sold: None.

(vii) Section 28 Report: Included in report for quarter ending 30 June 1981.

(v11i) Date Report Delivered to Congress: September 24, 1981.

POLICY JUSTIFICATION TURKEY-UH-lH HELICOPTERS

The Government of Turkey has requested the purchase of 15 UH-lH helicopters with concurrent spare parts, ancillary equipment, and support at an estimated cost of $32 m1llion.

This sale w111 contribute to the foreign policy and national security objectives of the United States by improving the military capab111ties of Turkey in fulfillment of its NATO obligations; furthering NATO rationalization, standardization, and interoperab111ty; and enhancing the defense fo the Western Alllance.

The sale of these helicopters w111 enhance the airmobile capab1llty and the search an,. rescue capab1lit1es of the Turkish Arme_ Forces. Turkey w111 have no difficulty in absorbing these helicopters. These items will be provided in accordance with and subject to the limitations on use and transfer provided for under the Arms Export Control Act, as embodied in the terms of the sale. The sale of this equipment and support wm not adversely affect either the basic mmtary balance in the region or u.s. efforts to encoura~e a negotiated settlement of the Cyprus question.

The prime contractors w111 be Bell Hellcooter, TEXTRON of Fort Worth, Texas, and AVCO-Lycoming of Stratford, Connecticut.

Implementation of this sale w111 require the assignment of one U.S. Government or contractor representative to Turkey for approximately 40 days.

There will be no adverse impact on u.s. defense readiness as a result of this sale.

SECURITY ASSISTANCE, SCIENCE, AND TECHNOLOGY

Washington, D.C., August 20, i981. Pursuant to section 620C(d) of the Foreign

Assistance Act of 1961, as amended (the Act), and the authority vested in me by Department of State Delegation of Authority No. 145, I hereby certify that the provision or UH-1H helicopters to the Government or Turkey is consistent with the principles contained in section 620C (b) of the Act.

This certification wm be made part of the certification of the Congress under section 35(b) of the Arms Export Control Act regarding the proposed sale of the above-named articles and is based on the justification accompanying said certification, and of which such justification constitutes a full explanation.

JAMES L. BUCKLEY.


DEFENSE SECURITY ASSISTANCE AGENCY, Washington, D.C., September 23, 1981.



porting requirements of Section 36(b) of the Arms Export Control Act, we are forwarding herewith Transmittal No. 81-101, concerning the Department of the Army's proposed Letter of Offer to Greece for defense articles and services estimated to cost $10 million. Shortly after this letter is delivered to your office, we plan to n_otify the news media.

You will also find attached a certification as required by Section 620C(d) of the Foreign Assistance Act of 1961, as amended, that this action is consistent with Section 620C (b) of that statute.

~incerely, ERICH F. VON MARBOD,

Director.

TRANSMI'rl'AL No. 81-101 Notice of Proposed Issuance of Letter of Of

fer Pursuant to Section 36 (b) of the Arms Export Control Act (i) Prospective Purchaser: Greece. (11) Total Estimated Value:

In millions Major Defense Equipment• -------------- $8 Other --------------------------------- 2

Total --------------------------- 10 • As included in the U.S. Munitions List, a

part of the International Traffic in Arms Regulations (!TAR).

(111) Description of Articles or Services Offered: Ten thousand 155mm M549A1 high explosive projectiles and 5,000 Mll9A1 propelling charges.

(iv) MUitary Department: Army (WLM). (v) Sales Commission, Fee, etc., Paid, Of

fered, or Agreed to be Paid: None. (vi) Sensitivity of Technology Contained


( v11) Section 28 Report: Included in report for quarter ending June 30, 1981.

(v11i) Date Report Delivered to Congress: September 23, 1981.

PoLICY JusTIFICATION GREECE-155MM MUNITIONS

The Government of Greece has requested the purchase of 10,000 155mm M549A1 high explosive projectiles and 5,000 Mll9A1 propelling charges at a.n estimated cost of $10 mlllion.

This sale will contribute to the foreign policy and national security objectives of the United States by improving the military capabilities of Greece in fulfillment of its NATO obligations; furthering NATO rationalization, standardization, and interoperabillty; and enhancing the defense of the Western Alllance.

The munitions are required by the Government of Greece in support of M109A1 155mm self-propelled howitzers already on hand in the Hellenic Army (HA). The HA will have no difficulty in absorbing, storing, and using the munitions.

These items will be provided in accordance with and subject to the limitations on use and transfer provided for under the Arms Export Control Act, as embodied in the terms of the sale. There wlll be no adverse impact on U.S. defense readiness as a result of this sale. The sale of this equipment and support will not adversely affect either the basic military balance in the region or U.S. efforts to encourage a negotiated settlement of the Cyprus question.

The ammunition will be procured from the Iowa Army Ammunition Plant of Burlington, Iowa.

Implementation of this sale will require the assignment of no more than two add!-

tional U.S. Government or contractor personnel to Greece for a period of about 14 days.

SECURITY ASSISTANCE, SCIENCE AND TECHNOLOGY,

Washington, D.C., August 20, 1981. Purusant to section 620C(d) of the Foreign

Assistance Act of 1961, as amended (the Act), and the authority vested in me by Department of State Delegation of Authority No. 145, I hereby certify that the provision of 155mm projectiles and propelling charges to the Government of Greece is consistent with the principles contained in section 620C(b) of the Act.

This certification will be made part of the certification of the Congress under section 36(b) of the Arms Export Control Act regarding the proposed sale of the above-named articles and is based on the justification accompanying said certification, and of which such justification constitutes a full explanation.

JAMES L. BUCKLEY.

DEFENSE SECURITY ASSISTANCE AGENCY, Washington, D.C., September 24, 1981.



porting requirements of Section 36(b) of the Arms Export Control Act, we are forwarding herewith Transmittal No. 81-102, concerning the Department of the Army's proposed Letter of Offer to Greece for defense articles and services estimated to cost $37 million. Shortly after this letter is delivered to your office, we plan to notify the news media.

You will also find attached a certification as required by Section 620C(d) of the Foreign Assistance Act of 1961, as amended, that this action is consistent with Section 620C(b) of that statute.


Director.

TRANSMITTAL No. 81-102 Notice of Proposed Issuance of Letter of Offer

Pursuant to Section 36(b) of the Arms Export Control Act ( i) Prospect! ve Purchaser: Greece. (11) Total Estimated Value:

In millions Major Defense Equipment• ------------ $35 Other -------------------------------- 2

Total -------------------------- 37 • As included in the U.S. Munitions List, a

part of the International Traffic in Arms Regulations (IT AR) .

(111) Description of Articles or Services Offered: Forty-eight M109A2 155mm self-propelled howitzers with support equipment, spare parts, and services.

(iv) Military Department: Army (WLT) . (v) Sales Commission, Fee, etc., Paid, Of

fered, or Agreed to be paid: None. (vi) Sensitivity of Technology Contained


(vii) Section 28 Reoort: Included in report for quarter ending 30 June 1981.

(vl11) Date Report Delivered to Congress: September 24, 1981.

PoLICY JusTIFICATION GREECE-HOWITZERS

The Government of Greece has requested the purchase of forty-eight M109A2 155mm self-propelled howitzers with support equipment. spare parts, and services at an estimated cost of $37 million.

This sale will contribute to the foreign policy and national securlty objectives of the United States by improving the military capabilities of Greece in fulfillment of its NATO obligations; furthering NATO rationaliza-

tion, standardization, and interoperab111ty; and enhancing the defense of the Western Alliance.

This weapon system is required by the Government of Greece to augment and upgrade medium artillery already on-hand in the Hellenic Army (HA). The HA w1ll have no difficulty in absorbing this weapon system since they already have 51 of the earlier M109Al configuration howitzers. These items will be provided in accordance with and subject to the limitations on use and transfer provided for under the Arms Export Control Act, as embodied in the terms of the sale.

The sale of this equipment and support wlll not adversely affect either the basic milltary balance in the region or U.S. efforts to encourage a negotiated settlement of the Cyprus question.

The prime contractor wlll be the BowenMcLaughlin-York Company of York, Pennsylvania.

Implementation of this sale will require the assignment of no more than two additional U.S. Government or contractor personnel to Greece for a period of about five days.

There wm be no adverse impact on u.s. defense readiness as a result of this sale.

SECURITY AsSISTANCE, SCIENCE AND TECHNOLOGY,

Washington, D.C., August 20, 1981. Pursuant to section 620C(d) of the Foreign

Assistance Act of 1961, as amended (the Act), and the authority vested in me by Department of State Delegation of Authority No. 145, I hereby certify that the provision of 155mm self-propelled howitzers to the Government of G.reece is consistent with the principles contained in section 620C(b) of the Act.

This certification wm be made part of the certification of the Congress under section 36 (b) of the Arms Export Control Act regarding the proposed sale of the above-named articles and is based on the justification accompanying said certification, and of which such justification constitutes a full explanation.

JAMES L. BUCKLEY,

DEFENSE SECURITY ASSISTANCE AGENCY, Washington, D.C.

Hon. CHARLES H. PEROY, Chairman, Committee on Foreign Relations,


porting requirements of Section 36(b) of the Arms Export Control Act, we are forwarding herewith Transmittal No. 81-104 and under separate cover the classified annex thereto. This Transmittal concerns the Department of the Army's proposed Letter of Offer to Egypt for defense articles and services estimated to cost $240 million. Shortly after this letter is delivered to your office, we plan to notify the news media of the unclassified portion of this Transmittal.

Sincerely, ERICH F. VON MARBOD, Director.

TRANSMITTAL No. 81-104 Notice of Proposed Issuance of Letter of

Offer Pursuant to Section 36(b) of the Arms Export Control Act (i) Prospective Purchaser: Egypt. (11) Total Estimated Value:

In millions Major Defense Equipment•----------- $179 Other ------------------------------- 61

Total ------------------------------- 240 • As included in the U.S. Munitions List,

a part of the International Trame in Arms Regulations (!TAR).

(111) Description of Articles or Services Offered: One hundred twenty-eight M60A3 tanks with tank thermal sights, related communications and supporting equipment,

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22513 M239 smoke grenade launchers, spare parts, basic load and training ammunition, special tools, t est equipment, training, and associated services.

(iv ) Military Department : Army (UDM, UDN, UDP, and UDQ).

(v) Sales Commission , Fee, etc., Paid, Offered, or Agreed to be Paid: None.

(vi) Sensitivity of Technology Contai~ed in the Defense Articles or Defense ServiCes Proposed to be Sold: See Annex under separate cover.

(vii) Section 28 Report: Case not included in Section 28 report.

(viii) Date Report Delivered to Congress: September 25, 1981.

POLICY JUSTIFICATION EGYPT-M60A3 TANKS

'Ille Government of Egypt hiSS requested the purchase of 128 additional M60A3 tanks in FY 1982. 'Ille sale will consist of the tanks with tank thermal sights, related communications a.nd support equipment, M239 smoke grenade launchers, spare parts, basic load and training ammunition, special tools, test equipment, training, and associated services at an estimated cost of $240 million.

This proposed sale Will contribute to the foreign policy objectives of United States by enabling Egypt to provide for its own security and self-defense, thereby contributing to the Middle East peace process and regional stability.

The Government of Egypt will use the tanks to replace a portion of its aging equipment rapidly becoming unserviceable due to the non-availability of spare parts. Previously, the bulk of the Egyptian armaments was provided by the Soviet Union, but for the past seven years Egypt has relied on Western nations for defense articles and services.

Because these tanks will replace obsolescent or unserviceable equipment already in the Egyptian inventory, the sale of this equipment and support will not have a significant impact on the regional military balance .

The p r ime contract or will be the Chrysler Corporation of Warren, Michigan.

Implementation of this sale will require the assignment of a small number of additional U.S. Government or contractor personnel to Egypt to provide training and maintenance assistance.


DEFENSE SECURITY ASSISTANCE AGENCY, Washington, D .C. , September 23 , 1981 .

Hon. CHARLES H . PERCY, Chai rman, Committee on Foreign Relations,

U .S. Senate, Washington, D .C. DEAR MR. CHAIRMAN : Pursuant to the re

porting requirements of Section 36(b) of the Arms Export Control Act, we are forwarding herewith Transmittal No . 81-105, concerning the Department of the Army's proposed Letter of Offer to Colombia for defense articles and services estimated to cost $10 million . Shortly after this letter is delivered to your office, we plan to notify the news media.


Director.

TRANSMITTAL No. 81-105 Notice of Proposed Issuance of Letter of Of

fer Pursuant to Section 36(b) of the Arms Export Control Act

(1) Prospect! ve Purchaser: Colombia. (11) Total Estimated Value:

In millions Mator Defense Equipment • - - ----- -- - - -- $8 Ot her ---------- - ----- ----- - - - - - - ---- 2

Total - -- - --------- ----- - - --- -- - 10 • As included in the U.S. Munitions List.

a part of the International Traffic in Arms Regulations (ITAR).

(iii) Descript ion of Articles or Services Offered : Twelve UH- 1H helicopters with related support .

(iv) Military Department: Army (UIB). (v) Sales Commission, Fee , e t c. , Paid, Of

feed, or Agreed to be Paid: None. (vi) Sensitivity of Technology Contained

in the Defense Articles or Defense Services Proposed to be Sold: None .

(vii) Section 28 Report: Case not included .tn Section 28 report.

(viii) Date Report Delivered to Congress: Se.ptember 23 , 1981.

POLICY JUSTIFICATION COLOMBIA-UH-lH HELICOPTERS

'Ille Government of Colombia has requested the purchase of 12 UH- 1H helicopters with related support equipment at an estimated cost of $10 million.

This sale will contribute to the foreign poli :::y o·b :ect ives of the United States in preserving t he poli t ical stability of a friendly democratic country. The Government of Colombia requires additional ut111ty helicopters to deal with an int ernal security problem posed by communist-supported guerrilla forces. Colombia already has UH-1H helicopters in i t s inventory and possesses the necessary capacity to absorb the additional quantity proposed for sale .

The sale of this equipment and support will not affect the basic mill tary balance in the region.

All of the equipment involved in this transaction will be diverted from the U.S . Army's inventory.

Implementation of t his sale w111 require the assignment of a six-man U.S. Army quality assurance team to Colombia for approximately two weeks.

There w111 be no significant adverse impact on U.S. defense readiness as a result of this sale.

DEFENSE SECURITY ASSISTANCE AGENCY, Washington, D.C., September 24, 1981 .

Hon. CHARLES H. PERCY, Chairman, Committee on Foreign Relations ,

TJ .S. Senate, Washington, D .C. DEAP. MR. CHAIRMAN: Pursuant to the re

porting requirements of Section 36 (b) of the Arms Export Control Act, we are forwarding herewith Transmittal No . 81-106, concerning the Department of the Air Force's proposed Letter of Offer to Korea for defense articles and services estimated to cost $110 million. Shortly after this letter is delivered to your office, we plan to notify the news media.

Sincerely, ERICH P. VON MARBOD,

Director.

TRANSMITTAL No. 81-106 Notice of Proposed Issuance of Letter of Offer

Pursuant to Section 36(b) of the Arms Export Control Act (i) Prospective Purchaser: Korea. (11) Total Estimated Value:

In millions Major Defense Equipment• --- - - ------- 0 Other --------------------------- - --- $110

Total _____________ _______ ______ _ 110

• As included in the U.S. Munitions List , a part of the International Traffic in Arms Regulations (ITAR).

(iii) Description of Articles or Services Offered : Cooperative logistics supply support arrangement, requisition case (FMSO II) , for follow-on spares and supplies to support aircraft and other systems and subsystems of U.S. origin.

(iv) Military Department: Air Force (KBL).

(v) Sales Commission, Fee, etc., Paid, Offered, or Agreed to be Paid : None.

(vi) Sensitivity of Technology Contained


(vii) Section 28 Report: Case not included in Section 28 report.

(viii) Date Report Delivered to Congress : September 24, 1981.

POLICY JUSTIFICATION KOREA-AIRCRAFT SPARE PARTS

The Government of Korea has requested the purchase of a cooperative logistics supply support arrangement, requisition case (FMSO II), for follow-on spares and supplies to support aircraft and other systems and subsystems of U.S. origin at an estimated cost of $110 million.

This sale wlll contribute to the foreign policy and national security of the United States by helping to improve the security of a friendly country which has been and continues to be an important force for political stability and economic progress in Eastern Asia. 'Illis sale will help to ensure that aircraft previously obtained by Korea from the U.S. are maintained in a mission-ready status to the maximum extent practicable.

This cooperative logistics supply support arrangement is necessary to ensure an uninterrupted fiow of spare parts to support the C- 123K, F-4D/ E , F- 5A/ B/ E/ F , T-33, and A/ T-37 aircraft, and other systems and subsystems of U.S. origin. The Korean Air Force will have no difficulty in absorbing the articles.

The sale of this equipment and support will not affect the basic military balance in the region.

Procurement of these i terns and services will be from the many contractors providing similar items and services to the U.S. forces.

Implementation of this sale will not require the assignment of any additional U.S. Government or contractor personnel to Korea.


DEFENSE SECURITY ASSISTANCE AGENCY , Washington , D .C. , September 29, 1981 .

Hon. CHARLES H . PER'::Y, Chairman. Committee on Foreign Relations .

U .S. Senate, Washin_qton , D .C . DEAR MR. CHAIRMAN : Pursuant to t he re

porting requirements of Section 36 (b) of the Arms Export Control Act, we are forwarding herewith Transmittal No. 81- 103 and under separate cover the classified annex thereto. This Transmittal concerns the Deuartment of the Navy 's proposed Letter of · Offer to Spain for defense articles and Eervices estimated to cost $26 million. Shortly after this letter is delivered to your office, we plan to notify the news media of the unclassified portion of this Transmittal.


Director.

TRANSMITTAL No. 81-103 Notice of PToposed Is-suance of Letter of

Offer Pursuant to Section 36('b) of the Arms Export Control Act (i) Prospective Purchaser : Spain. (11) Total Estimated Value:

In millions Major Defense Equipment• - --- ---- $24 ~her ------------------ - --------- 2

Total ------------------- - -- 26 *As included in the U.S. Munitions List, a

part of the In temart;lonal Traffic in Arms Regulations (!TAR).

(iii) Description of Articles or Services Offered: One hundred e·i.ghteen MK 46 MOD 5 ORDALT torpedo improvement kits with spare parts and support equipment for MOD 5 intermediate level torpedo maintenance.

(iv) Military Department: Navy (LDQ). (v) Sales Commission, Fee, etc., Paid, Of

fered , or Agreed to be Paid : None . (vi) Sensitivity of Technology ContaJ.ned

in the Defense Articles or Defense Services

22514 CONGRESSIONAL RECORD-SENATE September 30, 1981 PrQposed to be Sold: See AID.nex under separate cover.

(vii) Section 28 Report: Included in report for quarter ending 30 June 1981.

(viii) Date Report Delivered to Congress: 8ep>tember 29, 19811.

POLICY JUSTIFICATION SPAIN-TORPEDO IMPROVEMENT KITS

The Governmeillt of Sprun has requested the purchase of 118 MK 46 MOD 5 ORDALT torpedo improvement kdts with spare parts and support equipment for MOD 5 intermedia.te level torpedo mainttenance at an estimated cost of $26 million.

This sale will contribute to the foreign policy and na.tionaJ. security of objectives of the Undted States 'by furthering cooperation under our Treart;y of Friendship and CooperaJtion wiJth Spain and improving Spain's coastal defense. Such improvement will benefit the defensive posture 0f the southern fia.nk of NATO and contribute to keeping the sea. lanes open for supplying the U.S. in-country military fa.ciU'ties which are important staging and reilllforcement Slites.

The purch18Se of the MK 46 MOD 5 ORDALT torpedo illlp'rovemenrt kits is required by Sprun to upgrade a.ntd modernize the Spanish Navy's anti-sulbmarine warfare capa;b1lity. The Spanish Navy W'ill be capable of absorbing this system wit hin its inventory. Additionally, the Sparu.sh Navy wiH be capable of performing the required maintenance without impact on its current military capabilities. This proposed sale was not part of a. U.S. survey.

The sale of this equipmeillt and support will not affect the basic military balance in the region.

The p-rime contraotor will be Honeywell, Incorporated of Hopkdns, Minnesota.

Implemenrtta.tion of this sale will not require the assignment of any add'iltional U.S. Oovernmeillt or contr&IC'tor personnel to Spain.

There will be no adverse impact on U.S. defense readiness as a. result of t 'his sale.

PRELIMINARY NOTIFICATION PROPOSED ARMS SALES

Mr. DODD. Madam President, section 36(b) of the Arms Export Control Act requires that Congress receive advance notification of proposed arms sales under that act in excess of $25 million, or in the case of major defense equiiPment as defined in the act, those in excess of $7 million.

Upon receipt of such notification, the Congress has 30 calendar days during which the sale may be prohibited by means of a concurrent resolution.

The provision stipulates that, in the Senate, the notification of proposed sales shall be sent to the chairman of the Foreign Relations Committee.

Pursuant to an informal understanding, the Department of Defense has agreed to provide the committee with a preliminary notification 20 days before transmittal of the official notification. The official notification will be printed in the RECORD in accordance with previous practice.

I wish to inform Members of the Senate that two such notifications were received on September 16, 1981.

Interested Senators may inquire as to the details of these preliminary notifications at the offices of the Committee on Foreign Relations, room 4229 Dirksen Building.

The notifications follow:

DEFENSE SECURITY AsSISTANCE, Washington , D.C. September 16, 1981.

Dr. HANS BINNENDIJK, Committee on Foreign Relations, U.S. Senate,

Washington, D.C. DEAR DR. BINNENDIJK: By letter dated 18

February 1976, the Director, Defe·nse Security Assistance Agency, indicated that you would be advised of possible transmittals to Congress of information as required by Section 36 (b) of the Arms Export Control Act. At the instruction of the Department of State, I wish to provide the following advance notification.

The Department of State is considering an offer to a. NATO country for major defense equipment tentatively estimated to cost in exce3s of $7 million.


Director.

DEFENSE SECURITY AsSISTANCE, Washington, D.C., September 16, 1981.

Dr. HANS BINNENDIJK, Committee on Foreign Relations, U.S. Senate,

Washington, D.C. DEAR DR. BINNENDIJK: By letter dated 18

February 1976, the Director, Defense Security Assistance Agency, indicated that you would be advised of possible transmittals to Congress of information as required by Section 36 (b ) of the Arms Export Control Act. At the instruction of the Department of State, I wish to provide the following advance notification.

The Department of State is considering an offer to a. South Asian country tentatively estimated to cost in excess of $25 millioh.


Director.

Mr. PROXMIRE. Madam President, I suggest the absence of a quorum.


The assistant legislative clerk proceeded to call the roll.

Mr. BAKER. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

The PRESIDING OFFICER <Mr. GRASSLEY). Without objection, it is so ordered.

CONCLUSION OF MORNING BUSINESS

The PRESIDING OFFICER. Morning business is closed.

INTERNATIONAL SECURITY AND DEVELOPMENT ACT OF 1981

The PRESIDING OFFICER. The Senate will resume the consideration of S. 1196, which will be stated by title.

The assistant legislative clerk read as follows:

A bill (S. 1196) to amend the Foreign Assistance Act of 1961 and the Arms Export Control Act to authorize appropriations for development and security assistance programs for the fiscal year 1982, to authorize appropriations for the Peace Corps for the fiscal year 1982, to provide authorities for the Overseas Private Investment Corporation, and for other purposes.

The PRESIDING OFFICER. Does any Senator desire to be recognized?

Mr. PERCY. Mr. President, we have made some progress on this bill in the time the Senate has had to devote to it. We have a dozen or more amendments that will be offered. I should like to issue

notification to Senators and to their staffs that the managers of the bill wish to expedite this procedure and get down to amendments that will require lengthy debate. In order to do that, we ask if Senators would authorize the managers of the bill to call up those amendments, if there is no controversy about them, and the amendments can be accepted by the managers of the bill.

For example, we have a Kasten amendment which gives appropriations control over deobligations of appropriated funds. We can accept that amendment as is.

Another Kasten amendment requires AID administrator determination on the Sahel program. This amendment can be accepted as is.

As to another Kasten amendment, to delete backdoor funding of MAAG entertainment expenses, we can accept that specific authorization.

Senator INOUYE has an amendment regarding the monthly ceiling for Peace Corps volunteers. I believe we can accept that amendment as is, or with a $175 ceiling.

Another amendment by Senator INOUYE would create a ceiling rather than a fioor for extended FMS repayment terms. The managers of the bill can accept this amendment as is.

Senator PRESSLER has an amendment involving a report on future direction in foreign aid. It can be accepted as is.

Senator HUMPHREY has an amendment that condemns the use of biological or chemical agents in Laos, Cambodia, and other areas. This amendment can be accepted as is.

Senator MITCHELL has an amendment urging the President to name an Assistant Secretary for Human Rights within 60 days. We would like to discuss with Senator MITCHELL the possibility of simply deleting the 60-day timeframe but leaving the amendment as is otherwise. If we can reach agreement on that, that amendment can be accepted.

Senator PROXMIRE has an amendment providing for the President to urge the Soviets to pay U.N. peacekeeping arrearages. This amendment can be accepted as is.

Senator PELL has an amendment dealing with human rights language concerning Pakistan. The majority can accept that amendment as is, and I presume that Mr. PELL will speak for the minority in that regard. We could bring up that amendment immediately.

I have a technical amendment about which I believe there is no objection, and it can be adopted.

These amendments could be disposed of and should be disposed of this afternoon, immediately. I urge Senators to come to the fioor to offer those amendments or, if they cannot come to the ftoor, to authorize the managers to call up the amendments. So long as there is no controversy about them, we can dispose of them immediately and insert in the REcORD any commentary the Senators would like to make on the amendments.

There is also the possibility of a Glenn amendment on nonproliferation reporting requirements on Pakistan.

Senator HELMs has an amendment to

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22515 expand existing prohibitions on aid for land reform in El Salvador.

senator PROXMIRE has an amendment to deobligate AID funds for Syria.

Senators KASTEN and INOUYE have an amendment involving a contingency fund. I believe it would be best to deal with that after other amendments have been disposed of because of the discussion that may have to occur on it. That is one case and the only case I know of so far where we would prefer holding off.

Senator HATFIELD has an amendment which would establish a special envoy to produce a report to the Senate on El Salvador. This would require discussion with Senator HATFIELD.

It is probable that a rollcall vote would be required on an amendment by Senator KASSEBAUM to repeal the Clark amendment with additional language.

Senator HELMS has an amendment to repeal prohibitions on Chile.

Senator GLENN has an amendment with respect to mandatory aid cuts when a nonnuclear country detonates a nuclear device.

Other amendments include: Senator GLENN, to provide Symington waiver for Pakistan for 6 years only; Senator TowER, regarding Armed Services Committee control over SDAF; Senator TowER, regarding Armed Services Committee control over defense leasing provision; Senator KASTEN, regarding deletion of all SFRC earmarks; and Senator HATCH, to rejoin ACTION and Peace Corps.

Those will possibly require discussion and amendments, and the managers of the bill prefer to deal with the noncontroversial matters first.

Suppose, then, we start with the technical amendments:

UP AMENDMENT NO. 444

(Purpose: To make technical amendments) Mr. PERCY. Mr. President, I send to

the desk a technical amendment. The PRESIDING OFFICER. The

amendment will be stated. The legislative clerk read as follows: The Senator !rom Illinois (Mr. PERCY) pro

poses an unprinted amendment numbered 444 in a. technical nature.

Mr. PERCY. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.


The amendment is as follows: On page 6, lines 16 and 17, strike out", or

foreign procurement in the United States under coproduction arrangements".

On page 19, between lines 3 and 4, insert the following:

(c) Section 503{a) (3) of such Act Is amended by striking out "specified In section 504 (a) ( 1) of this Act, within the dollar limitations of that section," and inserting in lieu thereof "country,".

On page 26, line 2, strike out "section 104 (c) " and insert in lieu thereof "section 104 (g)".

On page 33, line 21, insert "and the" 1mmediately after the quotation marks.

On page 40, line 5, strike out "United States," and insert in lieu thereof "Government of the United States,".

On page 45, line 3, strike out "subparagraph" and insert in lieu thereof "paragraph".

79-059 0-85-22 (Pt. 17)

on page 55, line 2, insert "(other than policy guidance)" after "101 (b)".

on page 55, lines 10 and 11, strike out "subsection (a), (b), (c), or (d) of this section or under section 3 of this Act" and insert in lieu thereof "paragraph ( 1) , ( 2) , ( 3) , or (4) of this subsection or under subsection (b)".

on page 56, line 1, strike out " (c) " and insert in lieu thereof " (c) ( 1) ".


(2) The Agency referred to in paragraph ( 1) is abolished.

On page 63, line 2, strike out the comma.

Mr. PERCY. Mr. President, page 6, lines 16 and 17: This strikes out language added by the bill which is already current law.

Page 19, lines 3 and 4: This strikes out a cross reference in the Foreign Assistance Act of 1961 which is made inaccurate by a change in the current law made in the bill.

Page 26, line 2: This change in a reference to a section is necessitated by a printing error.

Page 33, line 21: This corrects a grammatical error.

Page 40, line 5: This clarifies the place in the law for which the bill has inserted additional language.

Page 45, line 3 : This corrects the use of a term.

Page 55, line 2: This conforms language in the bill transferring functions to the Agency for International Development with language elsewhere in the bill transferring functions to the Department of State.

Page 55, lines 10 and 11: This corrects a cross reference.

Page 56, line 1, and page 56, lines 12 and 13: This clarifies the intent of the section in the bill which abolishes the U.S. International Development Cooperation Agency.

Page 63, line 2: This corrects punctuation.

So far as I know, there is no objection to these technical amendments.

Mr. PELL. That is correct. We have been through them and we recommend the Senate agree to them.

The PRESIDING OFFICER <Mr. ScHMITT). The question is on agreeing to the amendment of the Senator from illinois.

The amendment <UP No. 444> was agreed to.

Mr. PERCY. I thank the Chair. Is it possible now for Senator PELL to

raise any amendment that may be disposed of now, or his own amendment dealing with hwnan rights language concerning Pakistan?

Mr. PELL. Certainly. UP AMENDMENT NO. 445

Mr. PELL. Mr. President, I call up my amendment and ask for its immediate consideration.

The PRESIDING OFFICER. The amendment will be stated.

The legislative clerk read as follows: The Senator from Rhode Island (Mr. PELL)

proposes an unprinted amendment numbered 445:

Strike lines 17 through 23 on page 82 and, in lieu thereof, insert the following:

SEC. 620E.-ASSISTANCE TO PAKISTAN. The Congress recognizes that Soviet forces

occupying Afghanistan pose a security threat to Pakistan. The Congress also recognizes

'

that an independent and democratic Pa.ltistan with continued friendly ties with the United States is in the inte·rest of both nations. The Gongress finds that United States' assistance will help Pakistan maintain its independence. Assistance to Pakistan is intended to benefit the people of Pakistan by helping them meet the burdens imposed by the presence of Soviet forces in Afghanistan and by promoting economic development. In authorizing assistance to Pakistan, it is the intent of Congress to promote the expeditious restoration of full civil Uberties and representative government in Pakis'tan.

Mr. PELL. Mr. President, I ask that the amendment be read since it is selfexplanatory.

My amendment modifies the prefatory language authorizing assistance to Pakistan to express the hope our assistance will promote the restoration of representative government and civil liberties. It is intended to send a signal of ou:· concern to the Government and peopl·~ of Pakistan.

In Pakistan, U. S. assistance is widely seen as an endorsement of President Zia ul-Haq's military regime. Our identification with the Zia regime carries the risk that we will be blamed for its conduct. Indeed several prominent and popular opposition leaders have warned that U.S. assistance to Zia now could do great harm to our long-term relationship with Pakistan.

Human rights violations in Pakistan have escalated in the last year. Prominent politicians continue to be held in prison without charge and under difficult circwnstances. There have been credible reports of beatings and torture of political prisoners.

Most civil liberties continue to be suspended in Pakistan. As the most recent State Department Human Rights report grimly notes :

Restriction on dissent and individual freedom have grown during the past year, while citizens rights have diminished.

My amendment makes it clear that U.S. assistance should benefit the people of Pakistan and should not be seen as support for continued miiltary rule or for the abridgement of fundamental human rights.

Mr. PERCY. Mr. President, there is no question that American assistance is designed to help the people of Pakistan. There is probably no area of the world thrut I have visited more frequently and have been more deeply -concerned about than the Near East. It is an area beset with problems, not the least of which is the crushing problem of population.

In a dining room adjoining the Chamber, the Mansfield Room, the Population Council is having a meeting hosted by Senator MATHIAS, a distinguished member of our Foreign Relations Committee.

Certainly they fully appreciate the problem that Pakistan is attempting to cope with, as is Bangladesh and India, and recognize that we run hard to stand still if we do not do something about population.

For this reason, in providing assistance to Pakistan we should take into account the people of Pakistan. Certainly the development of representative national institutions in Pakistan is in Pakistan's own interest.


I wish to commend my distin.guished colleague because if thi_s res~lu~10n had not been offered, there IS a d1stmct possibility that a resolution would have been offered that would be much stronger in tone and th~t .woul~ be less acceptable to this admm1strat10n and to many of us who look upon .oursely~s as friends of Pakistan but whom a.sp1nt of friendship wish to speak forthnghtly to them about certain of our concerns.

I thank my distinguished collea~e fl~r the moderation of his language which IS far more acceptable than other efforts that may have been made in this direction, and I feel with the adoption of this amendment it will preclude and make unnecessary other less satisfactory amendments.

I, therefore, on behalf of the majority accept this amendment. There is no objection to the best of my knowledge to

(including matters relating to refugees, prisoners of war, and members of the United States Armed Forces missing in action).

"(b) It is the sense of the Congress that"(1) a strong commitment to the defense

of human rights should continue to be a central feature of American foreign policy; and

"(2) the President, not later than sixty days after the date of enactment of this Act, should submit to the Senate the name of a nominee for the position of Assistant secretary of State for Human Rights and Humanitarian Affairs, as established by section 624(f) of the Foreign Assistance Act of 1961.". "

On pa.ge 84, line 4, strike out "SEc. 716. and insert in lieu thereof "SEc. 717.".

Mr. MITCHELL. Mr. President, I ask unanimous consent that Mr. BuMPERS, the Senator from Arkansas, be added as a cosponsor to the amendment.


the amendment. The PRESIDING OFFICER.

question is on agreeing to amendment.

Mr. MITCHELL. Mr. President, I ask The for the yeas and nays. the The PRESIDING OFFICER. Is there a

The amendment <UP No. 445) was agreed to.

Mr. PERCY. Mr. President, I understand that our distinguished colleague, Senator MITCHELL, has an amendment.

I wish to thank him on behalf of the manager of the bill for promptly coming to the floor as we have requested so that we may dispose of as many of the amendments as possible. I have indicated that we feel that this amendment, subject to one modification, can be accepted, and I am pleased to yield to him at this time for a presentation of this amendment.

Mr. MITCHELL. Mr. President, I thank the distinguished chairman of the Foreign RelatioriS Committee.

AMENDMENT NO. 561

Mr. President, I call from the desk printed amendment No. 561 and ask for its immediate consideration.

sufficient second? There is not a sufficient second. If the Senator will renew that request

at the appropriate time, we will see what we can do.

Mr. MITCHELL. Thank you, Mr. President.

Mr. President, this amendment expresses what I believe is the majority view of the Senate, and that is that a commitment to the defense of human rights should continue to be a central feature of American foreign policy.

The PRESIDING OFFICER. amendment will be stated.

Although President Reagan has been in office for over 8 months, the position of Assistant Secretary of State for Human Rights remains unfilled. The central feature of my amendment is a provision which expresses the sense of Congress that the President should fill this important position expeditiously. The amendment is cosponsored by Senators HATFIELD, KENNEDY, LEVIN, DODD, BAUCUS, BUMPERS, and LEAHY.

The In the wake of the controversy over the

The legislative clerk read as follows: The Sen a tor from Maine (Mr. MITcHELL) ,

for himself, Mr. HATFIELD, Mr. LEVIN, Mr. KENNEDY, Mr. HART, Mr. BAUCUS, Mr. DODD, Mr. LEAHY, and Mr. BUMPERS, proposes printed amendment numbered 561.

nomination of Dr. Ernest Lefever to be Assistant Secretary of State for Human Rights, suggestions have been made that the Office of Human Rights be abolished.

It has been suggested that the role of Government in furthering human rights is properly included within Government's

Mr. MITCHELL. Mr. President, I ask other responsibilities to further the ecounanimous consent that the reading of nomic, strategic, and trade interests of the amendment be dispensed with. the Nation.

The PRESIDING OFFICER. Without Concern has been voiced that an Office objection, it is so ordered. of Human Rights may, in some way, rep-

The amendment is as follows: resent an imposition of uniquely Amer-on page 84, between lines 2 and 3, insert ican values on other cultures and other

the following: governments. It has even been argued "NOMINATION FOR THE POSITION OF ASSISTANT that an Office of Human Rights may, in

SECRETARY OF STATE FOR HUMAN RIGHTS AND fact, rUn COUnter tO OUr national interest HUMANITARIAN AFFAIRs by imposing considerations on poUcy "SEc. 716. (a) The Congress finds that- questions which prevent policies being "(1) the United States has long been a

leading defender of the basic rights of persecuted, oppressed, and endangered people around the world, and should continue in this role; and

" ( 2) effective foreign policy information requires that the President and the Secretary of State possess current and accurate information derived from continuous observation and review of all matters nertainin;; to human rights and ~umanttarian affairs

carefully defined and carried out. All these reservations about the role of

Government in enhancing human rights are grounded in the idea that what a nation's government does is separable from what the nation itself is.

But the actions of a government cannot be separated from .the nation itself. We ought not express our misgivings about the complexity of human rights

issues in the world today by abandoning the one office in our Government whose st'ated and single goal is their enhancement.

The history of what our Nation is and stands for illustrates that as long as we remain the United States of America, we can never be unconcerned about human rights.

The United States of America is a great Nation. We have the largest and most productive economy in the world and the most powerful military forces in all of human history.

But the United States was a great nation long before it possessed economic or military strength. The United States was a great nation from the moment of its birth, when it contained fewer than 4 million persons clinging to the Atlantic seaboard. Its greatness then was based not on American power, but on American ideals. It still is.

The history of man is, unfortunately, largely a record of oppression.

Here, for what in the sweep of history is but a brief moment, the ideals of liberty, justice, and equality of opportunity have become living realities. The people of the world know that. They have known it for two centuries. That is why so many of them have come here and why so many more now try so desperately to reach American shores.

If the source of our appeal were military strength, the Soviet Union would attract a goodly share of immigrants, since it too is a great power. But no boatloads of refugees risk their lives to reach Soviet soil.

Indeed, as we pass laws to keep people out, the Communists build walls to keep them in.

Foremost among American ideals is our belief-our faith-in the worth of the individual. No principle is etched more deeply in the American character than that represented in the Bill of Rights: Each individual possesses inalienable rights that are secure from violation by anyone else, including the Government-especially the Government.

For most of mankind, past and present, that has not been true.

We live in a time of danger. The power of the weapons of destruction has increased more in the past half-century than in all the previous millenia of recorded history. At the same time, there is greater willingness to resort to violence to achieve goals, by individuals and by governments.

Strikingly, much of the violence and terror engaged in by governments is against their own peo.Ple. With good reason, many people fear their own governments.

And the governments which inspire the greatest fear are the ones which most loudly proclaim the princi.Ple that the repression of human beings within the borders of a nation state is a matter of little consequence and no legitimate concern to any other natiori state.

That principle has been endorsed by such nations as the Soviet Union today and Nazi Germany in the past. It echoes in the actions of such murderous regimes as Idi Amin's in Uganda and Pol Pot's

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22517 in Cambodia. It nourishes the contentions of such regimes as Argentina's and Paraguay's, which assert that their treatment of their citizens is no one's business.

In 1937, the civilized nations of the world met at the French spa of Evian to explore joint action to save the Jews of Germany. No agreement proved possible. The willingness of the civilized world then to placate Hitler's Germany, to ignore the fate of the Jews there, and to play down reports of mass murder in the East made possible the Holocaust, the central most terrible episode in the human experience in this century.

The postwar world recognized that the treatment of citizens within national borders was not the exclusive concern of a nation state or a national government. The postwar world joined together in our own country, under American leadership in San Francisco, and drafted the Universal Declaration of Human Rights. Our current human rights statutes stem from that antecedent and seek to further the goal of a humane world.

There is no more compelling commandment in the entire Judeo-Christian tradition than the one which asserts that we are, indeed, our brothers' keepers. To the limited and imperfect degree that governments can carry out that commandment, our human rights statutes represent an honorable, essential expression of what we, as a nation are, and what we, as a nation, should seek to remain.

We cannot be dedicated to the proposition that all men are of equal worth, that all men have equal rights, unless we apply those beliefs to all men-not to the select few who are lucky enough to live in democratic societies and enjoy civil liberties.

Human rights are not divisible. Our tradition, our moral code and everything we know informs us that as long as one of our fellow human beings suffers, we are all thereby diminished.

And human rights are not divisible from those creations of human beings which we call governments. We cannot be and remain humane beings unless our institutions-including our governments-are also humane.

All governments, including our own respond imperfectly to the challenge of upholding human rights. When that happens, some who call themselves realists contend that government cannot and ought not ma.ke moral judgments. They argue that government's sole responsibility is to practical economic and strategic interests. They cite John Quincy Adams, who said that "We are the friends of liberty everywhere but the custodians only of our own." '

'!hat maxim may have been appropriate to a small, new struggling nation ~n the dawn of the industrial era. But it IS surely no measure of our Nation's responsibilities today. Nor does it bear any realistic relevance to the world of the. 20th cen~ury, where the fates of all nations are Inextricably intertwined.

I believe another American President, our first a.nd greatest Republican President, Abraham Lincoln, more truly and

more fully expressed the view of Americans today when he said:

Those who deny freedom to others deserve it not for themselves, and, under a just God, cannot long retain it.

This century bears out the truth of that prophetic remark. . Our goal in foreign policy remains, as It ever has, to seek peace, to encourage industry, and to nourish trade between the nations. On that basis, America found its prosperity in the past and on that basis will continue to flourish in the future.

And so long as our own future remains so closely tied with the other nations of the world, so long must we remain concerned and active in support of the principles which animate our Nation.

Liberty, justice, and democracy are surely our paramount values. They are values sought by ordinary people throughout the world. They are values which are denounced and trivialized and suborned by totalitarian and authorization regimes throughout the world.

We have an obligation to give voice and action to our determination to protect the true meaning and the practical expression of those values in our world.

To do less is to concede to the totalitarian nations that there is liberty in Afghanistan, that justice is served by government goon squads, and that freedom flourishes in the Gulag.

Those are obviously lies, and if we have any national moral obligation whatever, it is to fight the spread of those lies.

We cannot do so if we permit any friendly nation to trade with us, to buy our arms, to entertain our ambassadors and our businessmen while its own agents hunt down and torture and kill their own people. We cannot do so if we will not permit our trade policies to be influenced by the extent of human rights violations in the Soviet Union.

The practitioners of practical politics, of politics empty of moral content, argue that any friendly nation ought to be able to buy anything from us. They argue that relations with the Soviet Union ought to be determined solely on the basis of our economic and strategic needs.

That is a view the Soviet Union itself endorses wholeheartedly.

But there is no basis for that view in American policy, in the American Constitution, or in the American tradition.

The American commitment to individual liberty, to personal dignity, to human self-worth stands unalterably opposed to it.

The public debate over the extent and the limits of Government's role in enhancing human rights in the world is today in danger of becoming a confrontation between the proponents of domestic policy differences. · Domestic political differences can and should play a role in setting the terms of our Nation's policies abroad, but they should not dominate the debate.

What is at stake is more important than domestic doctrinal differences: It

goes to the heart of what our country stands for.

Are we willing to embrace the barbarities of the totalitarians of the right in order to excoriate the totalitarians of ·the left? Are we willing to embrace a foreign policy which negates the struggle of individuals in favor of larger issues?

In a nation founded and sustained on the inalienable rights of individuals, what larger issue can there be?

Nations, like individuals, are what they do. We cannot assert respect for humanity and tolerate torture. We cannot and ought not pretend a reverence for the sanctity of the individual and countenance the negation of individuality which is the essence of all totalitarian regimes, left, tight and center.

If our ideals are to have meaning, our Government must act on them. Without practical expression, our ideals are nothing but rhetoric. Unless they are embodied in our policies, they remain lifeless. It is action which gives life to ideals. And to remain true to our ideals as a nation, our national government must be willing to take action on our principles.

The United States now has an Oftlce of Human Rights at the Department of State. Statute stipulates that this oftlce be directed by an Assistant Secretary whose responsibility it is to insure that our foreign policy makers fully understand the human rights implications of policy alternatives.

I am extremely distressed that this offlee has remained vacant for 8 months. Moreover, I am deeply disturbed by the message which we are sending to foreign governments, and to oppressed people who look to the United States for help and hope.

The amendment now before this Senate is designed to send a straight forward message to ouT President. The message is that the Congress persists in believing that the United States should continue in its role as a leading defender of the basic rights of persecuted, oppressed, and endangered people around the world. And secondly, that the structure established in existing statute should be maintained and allowed to function as envisioned bv the legislation branch.

Mr. President, I urge other Members of the Senate to express their strong, unequivocal feelings that the United' States of America stands for liberty, justi~e. equality of opportunity, and democracy, and we reamrm the message that has been the heart and soul of this Nation's strength from the day the United States was founded.

Thank you, Mr. President. I thank the distinguished chairman and ranking member of the Foreign Relations Committee.

Mr. LEVIN addressed the Ohair. The PRESIDING OFFICER. The

Senator from Michigan. Mr. LEVIN. Mr. President, first of all

I wish to commend m v friend from Maine for his extraordinarily timely amendment and the eloquence with which he puts it before this body.


We should stall po longer, Mr. President, in filling the . ~osition which has been referred to by tl\e Senator from Maine. Other positions essential to foreign relations have been filled. Passage of this amendment woulO be a symbolic gesture to the administration that the Senate perceives human rights as an issue of the utmost importance.

The United States has been without an Assistant Secretary for over 8 months now and our foreign policy reflects the absence. It is essential that an official advocate of human rights figure into our foreign policy decisions in order to come closer to achieving a just and balanced policy.

Since 1977, when the position was created, human rights has been officially recognized as a critical factor in determining foreign policy. Our Nation has been one of the most vocal and visible defenders of these basic rights.

We have acted as a catalyst in developing a world consciousness more sensitive to the fundamental contribution which human rights make to human existence. We are told that it is our strategic interests which must come first not the internal policies of our allies and friends. And that, Mr. President, is a totally false dichotomy.

No one has put it better and has shown the falsity of that dichotomy than Thomas Buergenthal in his speech "Human Rights And The U.S. National Interest."

Mr. Buergenthal is dean of the Washington College of Law of the American University in Washington, D.C.

Part of his speech reads as follows: I agree that the Soviet Union and what

it stands for presents the most serious threat to the U.S. national interest. But the threat is not only m111tary or subversive, it is also ideological and it must therefore be confronted on the ideological level as well. In today's world, ideology is as much a weapon as is sophisticated weaponry. A sound human rights policy provides the U.S. with an ideology that distinguishes us most clearly from the Soviet Union and seriously undercuts the ideological appeal of Communism.

It is the only ideology, the only dream, if you will, that the people of the U.S. share with the vast majority of the people of the second and third worlds. The quest for human rights and human dignity is a phenomenon of contemporary life of universal dimensions and immense significance in the struggle between East and West. And those who do not grasp its significance do not know much about the world we live in and the forces that shape it.

Dean Buergenthal continues: To suggest that we are imposing our values

on others by promoting human rights in other countries, be it against totalitarianism or oppressive regimes, is to reveal one's arrogance and ignorance. If we do not grasp the political and emotional significance of the human rights movement, we shall forfeit the only real competitive advantage we have in the struggle to contain Soviet expansionism and counteract its influence in the developing world.

Mr. President, I ask unanimous tonsent that the full speech by Dean Buerg·enthal be printed in the RECORD.

There being no objection, the speech was ordered to be printed in the RECORD, as follows:

HUMAN RIGHTS AND THE U.S. NATIONAL INTEREST

(By Thomas Buergenthal) (Speech delivered on March 10, 1981 at the

Meridi::m House under the sponsorship of the Pan American Development Foundation.)

(Judge Thomas Buergenthal is the Dean of the Washington College of Law of The American Unl verst ty. He is the sole American judge on the Organization of American States' Inter-American Court of Human Rights and the president of the recently established Inter-American Institute of Human Rights, which has its se~t in San Jose, Coste. Rica.)

Ladies and gentlemen: Few other U.S. foreign policy initiatives have been as misunderstood and as poorly articulated as has our human rights policy. The level of debate on this subject has been and continues to be sophomoric, and that is true of the arguments of its proponents and its opponents. Part of the blame rests with President Carter and the fact that he promoted the policy with the righteous rhetoric of a fundamentalist sermon so that much of the discussion of the subject took on a moralistic tone. And the few efforts that were made by the Carter Administration to justify the policy to the public in terms of our national interest did not get much of a hearing.

The current Administration falls into a similar trap. Its spokesmen criticize and reject a strong human rights policy because they see it as having purely moral but very little, 1f any, political significance. They view it as a propaganda tool to be used against the Soviets, but not to criticize our allies. They argue that totalitarianism of the left is worse than the respression of the right practised by some of our allies.

They contend that the U.S. faces a formidable adversary in Soviet expansionism and cannot afford the luxury of being the moral policeman of the world, imposing its own values on the rest of the world; that the u.s. needs allies and cannot afford to alienate friendly anti-Communist governments even if they are repressive. In short, they contend that what we need is to balance our commitment to human rights against foreign policy assets.

I agree that the Soviet Union and what it stands for presents the most serious threat to the U.S. national interest. But the threat is not only military or subversive, it is also ideological and it must therefore be confronted on the ideological level as well. In today's world, ideology is as much a weapon as is sophisticated weaponry. A sound human rights policy provides the U.S. with an ideology that distinguishes us most clearly from the Soviet Union and seriously undercuts the ideological appeal of Communism. It is the only ideology, the only dream, 1f you will, that the people of the U.S. share with the vast majority of the people of the second and third worlds. The quest for human rights and human dignity is a phenomenon of contemporary life of universal dimensions and immense significance in the struggle between East and West. And those who do not grasp its significance do not know much about the world we live in and the forces that shape it.

All over the world human beings are dying, human beings are being tortured, human beings disappear, are being imprisoned, and are held in insane asylums-all because they believe in the human rights and freedoms the American people take for granted.

To suggest that we are imposing our values on others by promoting human rights in other countries, be it against totalitarianism or oppressive regimes, is to reveal one's arrogance and ignorance. If we do not grasp the political and emotional significance of the human rights movement, we shall forfeit the only real competitive advantage we have in the struggle to contain Soviet expansionism

and counteract its mfiuence in the developing world.

The human rights policy which the U.S. followed in the past six years-it all started with Congressional action in 1973-4, with President Ford's strong support of the human rights provisions of the Helsinki Final Act, and President Carter's enthusiastic espousal and promotion of human rightshas had a significant impact.

In Latin America, for example, it contributed to the establ.ishment of democratic regimes in Peru, Ecuador and, for all too short a period, in Bolivia. It ushered in a liberalization process in a number of other countries in the hemisphere; it led to the entry into force of the American Convention on Human Rights and the establishment of the Inter-American Court of Human Rights.

And, most importantly, the U.S. began to lose the image it has had in the hemisphere as a government which allies itself with and supports oppression in Latin America. The U.S. began to be seen as a country willing to Hientify itself with the aspirations of the people of the region.

This realization opened up democratic alternatives in the hemisphere-one no longer had to chose only between Communism on the one hand and rightist oppression on the other.

Please do not misunderstand my emphasis on the political benefits to the U.S. of a strong human rights policy. I believe in human rights because I believe it is criminal and immoral to deny human beings their ha.slc rights and to violate them with impunity. It doesn't much matter, however, \Vhether U.S. policymakers share my convictions. If they believe that morality has no place in foreign policy, so be it. Let them, therefore, assess the foreign policy benefits of a strong human rights policy in purely Realpolitik terms before they scrap it.

I have already spoken of the comparative n.dvantage we have in this sphere over the Soviets. If the U.S. wants to exploit this advantage, it has to have an ideologically neutral human rights pollcy.

By this I mean that it has to express its opposition to violations of human rights with equal fervor, whether or not the violatlons are committed by the left or the right. The policy to be effective has to be credible and it can only be credible if it is ideologically neutral.

People all around the world have to see that the U.S. stands for human rights-not c.nly for human rights in the Soviet Union, but also in Central America, in South America, in Africa, and in Asia.

If instead we close our eyes to violations by cur friends and criticize only our adversaries, we will have reduced the policy to a mere propaganda tool-and the world will know H for the hypocrisy it is. And it will not be a foreign policy asset.

All this is not to say that there are no other foreign policy interests that the u.s. must take into account. Human rights should not and cannot be the only issue decisionmakers have to take into consideration in shaping foreign policy. It needs to be treated as an important foreign policy concern, however, and to dismiss it as moral claptrap is to do serious harm to the U.S. national interest.

A word about intervention which always pops up in discussions about human rights. There is the argument, for example, that it is a violation of international law for one country to compile reports on the state of human rights in another country and to publish these reports. It is also contended that it is illegal intervention for one country to complain publicly that another country is violating human rights. That is nonsense, ladies and gentlemen, both under general international law and under our own hemi-


spheric international law. I don't know of any international lawyer of stature who would seriously espouse that thesis today.

As a political matter, moreover, it is as much intervention for the U.S. today to identify itself with a government that engages in serious violations of human rights as it is to disassociate itsel! from that government and to take a public stand against those practices. The political reality is that a superpower simply cannot avoid intervention by association; we have to face up to this fact. Given this reality, the only serious issue is whether we are perceived as intervening by identifying ourselves with a repressive regime or by expressing our opposition to repression. I believe it is not in the U.S. national interest to support or be identified with repressive regimes whether of the left or the right.

Those opposing an effective U.S. human rights policy argue that it contributes to the demise of governments friendly to the U.S. In my opinion, this is a simplistic view of the impact of the policy. It is rarely ever a question of the demise or survival of a regime.

If a government friendly to the U.S. engages in repressive practices, U.S. policy, if properly managed and articulated, can move the government, over time, either towards more repression or towards less repression. The best example of this phenomenon occurred since the new Administration .took over.

I~ was perceived, rightly or wrongly, as opposing human rights, and immediately some governments in the hemisphere began to crack down on human rights activists, not because they had suddenly become a threat to the regime, but because the time was ripe. Most of the once friendly governments lost to the U.S. side were lost because of their long history of repression and our identification with those regimes; they were not lost because of our human rights policy.

Of course, I do not believe that the U.S. should "destab111ze" governments, but I believe that it can and should make its influence felt. As a matter of fact, as a superpower, particularly in this hemisphere, it cannot avoid making its influence felt, and the only issue is whether it will opt for a policy that is in the U.S. national interest or detrimental to it.

To conclude, ladies and gentlemen, what worries me most about our current policy direction is that the Administration appears to have decided upon a serious foreign policy change without having thoroughly examined the question whether in fact the U.S. national interest is advanced or harmed by a strong human rights policy. What we have heard thus far on the subject are slogans. What is lacking is substantial evidence and analysis.

I, for one, believe that it would be a serious political blunder for the U.S. to abandon a policy that identifies us with the aspirations of the people of our hemisphere and the world. Given our own political system and traditions, a credible U.S. human rights policy can enjoy the support of the American people, do some good in the world, and advance our national interest. That is why I believe that it needs to be preserved.

Mr. LEVIN. Mr. President, it is in our strategic interest to have a human rights policy. It is not in our strategic interests when friendly regimes or allies violate the rights of their citizens because those regimes will be s·o much weaker and less helpful to us as a result.

Unfortunately, calling for the nomination by the President does not guarantee the United States an active human rights attitude dedicated to furthering our international role. That is precisely why this body has a moral and ethical duty to

send a signal to the President that he ought to select a nominee who regards human rights as a key element in foreign policy. We must take care of this vacancy now. Swift executive and Senate action in nominating and approving a suitable Assistant Secretary for Human Rights and Humanitarian A1Iairs will provide our Nation with an urgently needed voice in foreign policy and is directly consistent With our very urgent security interests.

Finally, Mr. President, I ask unanimous consent that an article which appeared in the once existing Washington Star of February 18, 1981, be printed in the RECORD at this point.


RELIGIOUS LEADERS AsK PRESmENT FOR MEETING ON HUMAN RIGHTS

(By Jim Castelll) Prominent U.S. religious leaders have asked

to meet with President Reagan to discuss their concerns about human rights in foreign policy.

The group's leaders said violations of human rights in El Salvador and elsewhere might have been avoided if Reagan had heeded the call they made last December for a clear affirmation of human rights.

But the group said in a letter dated Feb. 9 and released yesterday that the reply they received-a "curt" note from national security adviser Richard Allen-was "not ... an acceptable response" to their December statement, which had been signed by 71 persons.

The letter asking for a meeting with Reagan contained the signatures of an additional 200 religious leaders, including the Rev. Bailey Smith, president of the Southern Baptist Convention, Rabbi Alexander Schindler, president of the Union of American Hebrew Congregations; Episcopal Bishop John Walker of Washington; the Rev. Theodore Hesburgh, president of the University of Notre Dame, and the heads of the organizations of Catholic men's and women's religious orders in the United States.

Sister Blaise Lupo, a Maryknoll nun who is co-director of Clergy and Laity Concerned, which organized the appeal, said Allen's response "was tantamount to a dismissal of the moral concerns of religious leaders who represent the broadest range of political persuasions in the religious community."

"It further ignores the significant constituency whose concerns the signers represent," she added. "I don't know of any other issue on which such leadership has been united." ·

In an apparent reference to comments Reagan and some in his administration have made about religious leaders' selectivity in human rights concerns, the new letter said:

"Mr. President, we oppose human rights violations wherever they occur, whether in communist, capitalist, socialist or mixedeconomy countries. We are strongly concerned about human rights in Afghanistan and Cambodia and about religious liberty in the Soviet Union.

"In this statement, however, we are particularly concerned about nations where the United States has extensive economic, political and mmtary involvement. This gives us influence whether we want it or not, and therefore, a greater responsibi11ty. They are also nations where your own position on human rights is already being assessed with great interest."

Mr. LEVIN. The final paragraph in a letter referred to in that article, which was addressed by 71 religious leaders to the President, reads as follows:

We are particularly concerned about nations where the United States has extensive economic, political and military involvement. This gives us 'influence whether we want it or not, and therefore, a greater responsib111ty. They are also nations where you own position on human rights is already being assessed with great interest.

Mr. President, the amendment of the Senator from Maine is urgently needed. It helps carry out the responsibility which was so well referred to by the 71 religious leaders in the letter of February 9, which they wrote to President Reagan referred to in the article in the Washington Star.

Again, I commend my friend from Maine and I yield the fioor.

Mr. PELL. I think th'is amendment has great merit. I ask unanimous consent that my name be added as a cosponsor.


Mr. PELL. Since Dr. Lefever withdrew from seeking th'is post, there has been consideraJble speculaltion in the press that the President m'ight leave it unfilled. I bel'ieve it would be a terrible mistake to leave the position unfilled or, worse yet, to abol'ish it. The amendment of the Senator from Maine is an excellent one calling as it does on the administration to move aheaJd and fill this position as soon as possible.

Mr. PERCY. Mr. President, I recognize the objective of our distinguished colleague, Senator MITCHELL, is to fill 2. p~sition which statute provides. It is an area of tremendous imporOO.nce. It is the essence of what this Nation stands for.

The Congress and the President sought to focus attention on tha.t when creating such a position.

However, the administratdon has indicated, after having this maltter under review, that it wishes ·to continue their s·tudy. I would have to report tlo my distinguished colleague that 'there wm be objection, and I have been asked to register objection in behalf of at least one of my colleagues on the majority side if the time frame is left in the amendment.

If the words "not later than 60 days after the date of enactment of this act" can be deleted from the amendment by the author of the amendment, and his cosponsors, then there would be no objection and it could be acceiJt;ed by the managers of the bill.

In view of the fact that the amendment is, in a sense, advisory, and does, in a sense, express the intention and desire of the Senate. the word "should" is used rather than "shal'l." Therefore, it is somewhat discretionary with the President.

The addition in statute of the 60-day deadline would be redundant and possibly unnecessary.

My suggestion to the a utlhor of the amendment would be that we delete those words, but in a colloquy express What the sense of the Senate is. If there is no request by the administration, and to my best knowledge there has not been any such request, that the position authorized in law be abolished, then it


would behoove the administration in due course to fill that position.

In view of the controversy that was created by the nomination previously made for this post, it is understandable that the administration would want to fill all other posts that would not be controversial. There has been a tremendous effort by the administration in completing its team. That process has virtually now been completed, and they can tum their attention to the Assistant Secretary for Human Rights and Humanitarian Affairs.

I think in view of the history so far this year of the relationship between the administration and the Senate on this position, they would want to give it due care. I would prefer that a time frame not be stipulated, but that we establish in a colloquy what is a reasonable period of time. It would be my feeling that so long as they have not asked to have Congress abolish this position, so long as it does exist in law, so long as they are a law abiding administration and have spoken strongly on that, they would want to be a model to the country. Certainly, when a distinguished former Federal judge, now our respected colleague in the Senate, simply wishes to set a goal to have it filled within 60 days, I would hope that by colloquy on the floor we could establish that as the sense of the Senate. Then the objection from this side of the aisle could be removed and we could work with the administration to fi.ll this job in an atmosphere that would be more conducive to comity than if we were-for the first time to my knowiedge-put an absolute statutory deadline in place.

As I understand it, and possibly my distinguished colleague can provide more details, when the Nixon administration did not fill a post, the Federal court ordered the administration to fill that post. Certainly, it is not the desire of the legislative branch or the executive branch to take these matters to the courts, which are clogged enough as it is, when perhaps they can be worked out between us.

Perhaps mv distinoouished colleague could review the circumstances involved in the Nixon case, which he has discussed with me. If there is precedent for the Congress establishing deadlines to the administration for filling pos.ts within the province of the President, perhaps that precedent could be followed. If there is no such precedent, possibly through colloquy we could suggest what we think is a reasonable time frame and work with the administration with respect to filling this post, or have them come to a decibion as to whether they will ask Congress to abolish the post.

In advance, I can advise the administration that, in my judgment there would be a considerable amount of discussion, heated discussion, on such a request.

I yield to my colleague for any comments that he would like to make on the request that the majority manager of the bill has made, that he delete those words that establish the intent and purpose of the act.

Mr. MITCHELL. Mr. President, I thank the distinguished chairman.

I ask unanimous consent that Senator RIEGLE be added as ·a cosponsor to my amendment.


Mr. TSONGAS. Will the Senator yield?

Mr. MITCHELL. Yes, I yield. Mr. TSONGAS. Would the Senator

add me, too? Mr. MITCHELL. Mr. President, I ask

unanimous consent that Senator TsoNG.AS be added as a cosponsor.


Mr. MITCHELL. Mr. President, may I inquire of the distinguished chairman specifically what he proposes with respect to my amendment? I did not hear the specific words he suggested be deleted.

Mr. PERCY. I suggested we delete the words "not later than 60 days after the enactment of this act."

The wording of the amendment would then be, in paragraph (2):

The President should submit to the Senate the name of a nominee for the position of .Assistant Secretary of State for Human Rights and Humanitarian Affairs, as established by section 624(f) of the Foreign Assistance Act of 1961.

Mr. MITCHELL. I thank the chairman.

Mr. President, I wish to make a couple of points. First, this office is statutorily established. It is not simply a part of an executive branch. That is not true of all bureaus within the Government. So it is important to understand that this office represents a specific legislative intention by the U.S. Congress that this is something important for our Government to do. I think there is no disagreement on that, or at least, very little disagreement on that. I am sure there is none between the chairman and myself or the ranking minority member.

The fact of the matter is that this is almost October 1, Mr. President. The office has remained unfilled. There is now no prospect of a nomination to be made. Indeed, as the chairman indicated in his remarks, it is at least possible-no one can weigh with certainty what the odds are-that the administration will at some point propose not to fill the office, but, in fact, to abolish it. As we all know, that has been much discussed in recent months, specifically after the withdrawal of the nomination of Dr. Lefever.

My concern simply is that this is something the U.S. Congress has specifically legislated on, and has indicated its strong intention. It is something that touches the very cornerstone of what this country stands for, the belief in the value of human worth, of individual dignity. Its failure to fill the office, leaving it vacant, downgrading it, minimizes it and has the effect, whether intended or not, of signaling to the world a downgrading of America's commitment to those principles insofar as it affects our foreign policy. That is the clear message. I do not want to suggest that anyone intends that message. That is plainly the consequence of our Government's failure to fill this office.

Mr. President, I want to work, as the chairman has suggested, with the administration. I hope that the administration will move promptly to fill this office and I do not want to be engaged in anything which establishes a precedent that may be an improper one, as the chairman suggests. My own interest is in seeing that an ideal and a principle which is central to this Nation's heritage, which is central to this Nation's values, be a part of our foreign policy. That is something I think we all agree on.

I ask the chairman, under the circumstances, if the language is deleted, does he agree, from his vantage point as chairman of the Committee on Foreign Relations, that 60 days is a reasonable time to expect some action by the administration with respect to this office?

Mr. PERCY. I do agree that 60 days is a reasonable period of time. I think it is a case of fishing or cutting bait, so to speak. This is not a new subject. There must have been a number of potential nominees at the time that Dr. Lefever was selected.

There must have been alternatives that were considered-! have even suggested several alternatives-people who are highly regarded by the administration, as possible choices. Though it is not in the province of the Senate to do anything other than suggest in our advise and consent capacity, we are often asked for advice. Sometimes we offer it when it has not been asked for. In this case, Mr. President, I simply feel that asking for abolishment of the post would be a signal to the world at this particular time that we have lost interest in or are minimizing the importance of human rights.

Would anyone in this body say that we are not concerned about the human rights of people in Poland today?

Are there any Senators who are not concerned about the human rights of the people in Afghanistan today? Would we want to minimize our attention to those causes?

Are we less concerned today than we were at any time about the human rights of people in El Salvador or Argentina or any place else in the world?

We cannot just say, "We have our human rights in this country, you go get yours." We have always been in the forefront of offering hope. inspiration, and leadership in this :field. At this particular time, when the administration, because of some readjustments of policy, is, in a sense. on the defensive in this area, the last thing I should think the administration would want to do is open up a Pandora's box by simply not filling this post or asking that it be abolished.

Mr. President, perhaps overemphasis was placed on this area by a previous administration. There are other thing'l that are crucial and vital to the wellbeing of this country and the free world. including an adequate defense and a strong, dynamic economy. This cannot be the centerpiece of all our efforts.

I admire this administration for focusing its attention on other very cruc'al areas as well. However, we would not in any way want also to send a sig-

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22521 nal that human rights is being minimized or totally deemphasized by the symbolic gesture of abolishing the office or not filling it.

Mr. President, I think 60 days is a reasonable period of time. I think it would certainly be accepted by the majority of the Members of the Senate. But it would be difficult to put it into statute for some of my colleagues who believe-and I share that belief-that establishing this type of precedent would be, perhaps, unfortunate. We have not ever done that with previous administrations; why do it with this administration? Why not try to work it out in a sp:.rit of comity with the administration?

Mr. MITCHELL. Mr. President, in view of the chairman's very strong remarks and commitment, I inquire, if this amendment is accepted with the changes he has suggested and then 60 days elapse and the administration has still not filled the vacancy, could I expect that the chairman and the ranking member of the Committee on Foreign Relations would join with me in a renewal of this amendment in its present form? Would that, then, be a satisfactory indication that, as I have suggested, the administration is doing precisely that which the chairman has suggested we do not want to do? That is, downgrading, trivializing, minimizing, not pursuing this policy?

Will the chairman agree, then, that if 60 days elapse and we do not have someone up here from the administration, the chairman will then join me in this effort to impose a deadline to get something done to demonstrate our commitment, so that it is not just words and that it is, in fact, deeds?

Mr. PERCY. Mr. President, I think we could do better than just waiting 60 days and then trying to do something. I hope I can speak on behalf of Senator PELL, that we will begin no later than tomor-

- row with the Secretary of State, indicating to him our feeling on this subject, and begin the dialog which we hope will lead to a successful conclusion before the 60-day period. We will exert our best effort to see that the intention of our distinguished colleague and his cosponsors is fulfilled, or immediately report back to him if there is any other course of action-which I have no knowledge of at this time-that the administration intends to pursue.

Mr. MITCHELL. I yield to the Senator from Massachusetts.

Mr. TSONGAS. I thank the Senator for yielding.

Mr. President, I commend the Senator from Maine on his amendment. There are a number of issues here, and I will not go into the matter in excessive detail.

This country was founded on human rights. It may be considered to be a fringe issue today, but 206 years ago, in Lexington and Concord, it was not considered fringe. We all are inheritors of a commitment to human rights that was exhibited at that time, including the loss of life.

If this Nation means anvthing, and I believe it does, what it means is that the individual has a certain sanctity, and that sanctity should be preserved. That is for our own, if you will, view of self.

The second issue I raise is that we are in a battle with the Soviets. It is not just MX missiles. We found out in Vietnam that the issue basically, beyond the military imbalance question, which is real, and I acknowledge that, is hearts and minds. In Vietnam we found out that if you do not have with you the hearts and minds of the relevant people, military might does not solve the problem.

What we are dealing with is a struggle between ideologies, between the MarxistLeninist view of the world and that of the Western nations. I happen to feel that when both are in a position of equality, our view will dominate.

One of the most effective weapons we have in the attempt to convince people that the free enterprise, capitalistic approach that we espouse is sensitive to humans is the human rights doctrine. If we abandon that, we, in essence, abandon a major weapon we have in the great battle for the hearts and minds of Third World nations.

No one is happier than the Soviet Union that we do not have a Human Rights Secretary, because they can go around the Third World nations and say, ''They have a commitment to human rights, and they don't even have an Under Secretary."

I argue that if the Soviets can use that argument. why not take it away from them?

This Nation was upset with what happened to Dr. Lefever. Will that be our peak? It can last only so long. Now is the time. Not filling his post plays into the hands of the Soviet adversaries we are concerned with.

Mr. PELL. Mr. President, I ask unanimous consent that a letter strongly supporting the amendment from five Members of the other body be printed in the RECORD.

There being no objection, the letter was ordered to be printed in the RECORD, as follows:

COMMITTEE ON FOREIGN AFFAIRS, HOUSE OF REPRESENTATIVES,

Washington, D .C., June 18, 1981. The PRESIDENT, The White House, Washington , D.C.

DEAR MR. PRESIDENT: We are writing toreaffirm our belief that a strong commitment to the defense of human rights should be a central feature of American foreign policy.

Accordingly, we respectfully urge you to submit to the Senate a nominee for the post of Assistant Secretary for Human Rights and Humanitarian Affairs in the Department of State. We pledge our support in working with the new Assistant Secretary to advance the protection of human rights wherever governments and individuals may seek to deny them.

Thank you for your consideration. With all good wishes,

Yours sincerely, ARLEN ERDAHL. JOEL PRITCHARD. ROBERT K. DORNAN. MILLICENT FENWICK. JIM LEACH.

Mr. PELL. Mr. President, I add my thought that the amendment is an excellent one. The 60-day period, that is the date set forth in the amendment originally, is a reasonable time frame. I trust that the administration will come for-

ward within the originally proposed 60-day period with the name of the nominee for the post of Assistant Secretary for Human Rights and Humanitarian Affair8.

UP AME'NDMENT 446

Mr. TSONGAS. Mr. President, I send to the desk a perfecting amendment and ask for the yeas and nays.



The Senator from Mass~husetts (Mr. TSONGAs) pr.oposes an unprinlted amendment numlbered 446 to amendment numbered 561:

On amendment numbered 561 (by Senator MITcHELL), o•:c page 2, add the following after line 20 :

(c) Notwithstanding any other provision of liaw, section 118 of t'he Intern'ational Security and Devel·opment Cooperation Act of 1980, relating to Angola, shall cease to be in effeot the earlier of-

( 1) a dalte by which the President has determined that an effective cease-fire Is In plSiCe in. Namibia and that preparations for in.tern.ationa.Uy supervised elections in Na.mtbia are in progress; or

(2) Ma.rch 31, 1983. (d) Nothing in thls section shall be con

strued to be an endorsement by Congress of the provision of assistance for the purpose, or which would have the effect, of promoting or augmenting, directly or indirectly, the capacity of any nation, group, organization, movement, or individual to conduct mmtary or param1Utary operations tn Angola.

Mr. ~SONGAS. Mr. President, I ask for ·the yeas and nays.

The PRESIDING OFFICER. Is there a sufficient second?

Mr. PERCY. Mr. President, a parliamentary inquiry. Is this amendment in order?

The PRESIDING OFFICER. This amendment, in the absence of a time agreement, is in order as an amendment in the second degree.

In answer to the parliamentary inquiry, the amendment is in order.

Mr. TSONGAS. I renew my request for the yeas and nays.

The PRESIDING OFFICER. Is there a sufficient second? There is a sufficient second.

The yeas and nays were ordered. Mr. TSONGAS. Mr. President, I was

reluctant to do this. It had been my hope that I could have had an agreement to have a vote on my amendment. This is a compromise amendment. That agreement was not forthcoming, and I feel that I had no choice.

There are important issues to be discussed here, and I did not wish to be precluded. Why we could not have had an understanding is beyond me.

I shall recite some of the history of this issue.

Back in the Ford administration, when Henry Kissinger was Secretary of State, there was in the post-Portuguese rule period in Angola a struggle for supremacy among three insurgent indigenous groups. It is hard, in retrospect, to keep track of who was alined with whom and when. However, to make a long story short, eventually the NPLA, which was a leftist-Marxist guerrilla movement. prevailed.


He at that time was concerned that the United States would become involved in helping one of the groups, and 'the Clark amendment was introduced by our colleague, Mr. Clark, and DoN BoNKER in the House. Basically, it precluded U.S. covert activities in Angola.

When the Foreign Relations Committee met, it was a move to repeal the Clark amendment in toto , and there was a lot of maneuvering around and discussions and lobbying, as is traditional in the legislative process.

When we came to a vote or were about to vote, I had in my possession the necessary proxies plus votes there to defeat the repeal of the amendment, and I could have done that. Rather than pressing the advantage I had, I decided that there were two issues that would have to be considered. One is that there is a good argument to repeal Clark, and one could not ignore that reality. The second is that the appeal of the argument for repeal would make it difficult for the committee to sustain that position on the floor.

I, for one, am really quite concerned about what happens to the Foreign Relations Committee when we come to the floor.

We are not known among our colleagues apparently for being a very strong committee. But I would argue with you that we have jurisdiction and we have a certain expertise and I think that we are proud of the work product that we produce.

In an attempt to put the interest of the committee above my own policy interest I agreed not to press with the proxies that I had and to work with various members of the committee and came up with a compromise.

The compromise was as follows: That the repeal was allowed with con

ditions, and the conditions were several relating to a determination-! am just going to read the most important onea determination that substantial progress, including effective cease-fire, in preparations for internationally supervised elections as made by all parties to achieve an internationally recognized settlement for the independence of Namibia and that the provision of such assistance-this is covert assistancewill not substantially impair the prospects for the internationally acceptable N::i.rnibia settlement.

That compromise was worked out and was voted on by the committee 11 to 3.

I made it ouite clear at the time that if I were willing to forego the proxies, an advantage I had for a straight repeal, I would expect in return support for the compromise on the floor. There was no indication given that that would not be the case.

Time goes on and there are issues raised about whether the committee fully understood the cease-fi:-e language was in the amendment. We can argue that until kingdom come but that is not important to the issue today.

So we come in to this issue anew. If I were insistent on the support given to me and to the amendment, which was cosponsored by the chairman and myself, I could have come to the floor and

insisted that the commitments made to me in the committee be honored. If that were not going to be the case, at least let us do it publicly, so that in the future I know what I am dealing with.

That would have been an interesting exercise in pique but it would not have served any purpose. So what I tried to do was to step back and say, all right. What are the issues here? What are the valid points to be made and how can we work out a compromise that, notwithstanding what was said in the committee, serves the best interests of all parties?

The question before the Senate is the choice between a prudent policy and technically consistent legislation.

Senator KASSEBAUM will subsequently offer an amendment to repeal the Clark amendment. It will be a straight repeal.

There is a very strong argument for that amendment. The argument is that it does not make sense, technically, to have a country-specific prohibition of covert activities, that there is no reason why Angola should be in a special category from every other country.

That argument, I think, is valid and there is no way arqund that validity. There is a rhetorical way around it but substantively there is not.

So the repeal of the Clark amendment I think is something that we should consider and should pass because it is a kind of an anachronism in that technical sense.

That is No. 1. If that were the only issue involved, then I would be supporting the Kassebaum amendment.

There is another issue and that is what is happening in Africa today and specifically what is happening in Namibia. In addition to the technical issue raised there is now a policy question.

In my view the policy question is as legitimate and I would argue that if I from my perspective am compelled to recognize the validity of the argument for repeal, then I would expect reciprocity, that those on the other side would recognize the validity of what I am saying as to the policy issue, that openmindedness on this issue I hope will not be a one-way street.

What is the policy issue? The fact is that the Clark amendment is a symbol and its repeal is an extr~mely vivid issue in Africa today. The amendment symbolizes for both our friends and indeed our foes a capacity of America for restraint, a tacit agreement that the overthrow of existing regimes and particularly that of Angola is not how we conduct foreign policy, unlike the Soviets are telling them.

In Africa where there are so many governments that are weak and vulnerable that issue is vitally important.

At the present juncture the administration is deeply involved, as we all know, in, and I believe in making progress in, the delicate negotiations of a Namibia settlement. I believe that the repeal of Clark intervenes, intrudes in that process and sends a message very different than what we intend.

If we repeal Clark straight out, what we are doing is in essence cleaning the book. This is our perspective, but that is not how it will be received.

Our role in negotiations in Namibia is as an honest broker and that role would be badly compromised.

Our credibility with the Angolas would slop over to other friendly states and would be seriously damaged and the question is whether we want to risk all that to clean the books of this anachronism.

The conclusion is, yes, we can and should repeal the Clark amendment but not at this moment.

My amendment does two things. The argument made by members of the committee subsequent to the committe action was that the ceasefire language in the committee-approved amendment gave veto in essence to any party that wished to engage in violence, that an effective ceasefire as the condition for the repeal of Clark in essence gave any of the par~ies the capacity to undo what Congress mtended, and that also is a legitimate argument. To any party whether it is Angola or South Africa or SW APO or whoever, if they wanted to sabotage the intent of the Senate, they need only engage in violence, so the incentive was there and this concerned many members of the committee and especially the chairman.

So what is then on the table? On the table is the agreement that we should repeal Clark. On the table is the recognition that this is the delicate point in time in that repeal today would send signals that would be counterproductive, and on the table is the recognition by myself that the effective cease-fire does indeed offer problems in terms of anyone who wishes to simply draw it out through violence.

Although the committee voted decisively for the language, I feel that the administration's excellent progress in the Namibian negotiations deserves to be recognized, and what I put together is a compromise.

This is a compromise that does the following: It repeals Clark, it recognizes the validity ~f that argument and says, "Ye3, there 1s no reason why Namibia should be treated differently from anything else, and the Clark amendment should be repealed. That repeal shall take place in either of two ways: A date by which the President has determined that an effective cease-fire is in place and preparation for internationallysupervised elections are in progress in Namibia." It is very similar to what was in the committee-accepted amendment, and that recognizes in Namibia the negotiations we are involved in.

Well, some may come back and say "You are still in the same box. In effect: you have given Angola, SWAPO, a veto over South Africa or anything else, a veto power over the repeal," and that is why there was included in the amendment a date certain, March 31, 1983.

So, in effect, what happens is that the repeal of Clark is going to take place. We recognize the validity of the negotiations on Namibia, we recognize we do not want to give anybody a veto power over the cease-fire language. So what we say is this: Whichever comes first, whether the cease-fire comes :first or whether March 31 comes first, Clark will


be repealed. So anyone who would. think of dragging this thing out has no mcentive because indeed there is a date certain at which point Clark is repealed.

Why did we use this approach? First, I think it makes sense, and if we were not so engaged in sort of parliamentary and other considerations, I think it would have been in effect and, in my opinion, it should have been acceptable to all concerned.

There is a parallel that we draw on, and that is Zimbabwe. The parallel was used for the very simple reason that it worked. It is not hypothetical. It is not theoretical. It is a fact that it worked, although it is not an exact case, but certainly a parallel in the case of Zimbabwe.

My colleagues will remember there were promising negotiations underway at Lancaster House to bring about a peaceful settlement of the war in Zimbabwe in 1979. The Senate did not consider those negotiations worthwhile apparently and voted to lift the sanctions against Rhodesia. The House did not, and the House prevailed.

In November the negotiations were progressing, and that was the time we decided to link the lifting of sanctions to the success of those negotiations, and the full Senate voted in iavor of that approach.

What we did at that point was to allow the negotiations to continue. What happened? We have, as you know, a government in Zimbabwe that certainly by African standards has been successful; is decidely anti-Soviet. It elected its own prime minister, and that prime minister has received support in terms of aid in both the Carter and, indeed, the Reagan administrations, and has done very well wooing Wall Street, which is not true of heads of state even in this country.

The fact is if the Senate's position had prevailed in the luting of the sanctions we may well have had a great deal more civil unrest and would have played into the hands of the Soviets. Because of the House we were saved from that folly. Now we have a situation that most people in this country would admit has served the West, Africa, and Zimbabwe very well.

What I am asking that we do is the same thing in Namibia. We made a mistake and why repeat it? Let us repeal Clark, let us put on the conditions and the date certain and why not give the Namibia negotiations a chance? Is that too much to ask? There are lives involved.

I hope my colleagues will go ahead, will repeal Clark. Why not give that part of the world time to resolve their issues, 18 months, and at the end of that period if they have not resolved them Clark comes off. We have lived with Clark now tor, I believe, 6 years. Another 18 months, and then it comes off; 18 months to give these people a chance to work out a peace so that they may enjoy the same security that we do.

This is a compromise; it is a compromise after the agreement in the committee, and I frankly hope_ that my colleagues will see fit to acknowledge what

I have attempted to do, and vote in favor of the amendment.

I thank the Chair. Mr. PERCY addressed the Chair. The PRESIDING OFFICER <Mrs.

HAWKINS). The Senator from Illinois. Mr. PERCY. Madam President, it is my

intention-and I would like to have the attention of my d!stinguished colleague, Senator TsoNGAs-to move regretfully to table the Tsongas amendment.

Before I do that I would like to give an opportunity to my distinguished colleague, Senator KASSEBAUM, to comment on this matter. But I would like to review just a few points.

F'irst, Senator KASSEBAUM has been on the floor ready to offer her amendmrnt. We have been working to establish a. time agreement, and it was the understanding of the floor managers of the bill that a time agreement could be worked out on the Kassebaum amendment. Regrettably it was not concluded because the necessary requests had not been made. As the Senator knows, the committee amendment on this important issue, to which Senator TsoNGAS has contributed a great deal of thought, time, and attention, carried a provision for a cease-fire that troubled me very much indeed.

Mr. TSONGAS. Madam President, will the Senator yield for a moment?

Mr. PERCY. I yield without losing mY right to the floor.

Mr. TSONGAS. Just so the record is complete, I had agreed to a time agreement. All I requested was a vote on my amendment. Given the fact that my amendment in the committee was a compromise, and I did not proceed with the proxies that I had in deference to the committee, given that fact; given the fact that I backed down from that and now have a compromise, all I wanted was a vote on my amendment.

And the chairman did not see fit to give that to me. That is why I moved earlier.

I do not think that was an undue request, given my history with the chairman of trying to accommodate the best interest of the committee.

I would just like that to be on the record.

Mrs. KASSEBAUM. Will the Senator yield?

Mr. PERCY. I am happy to yield. Mrs. KASSEBAUM. Madam President,

I would just like to say that I can certainly appreciate what the Senator from Massachusetts is saying. But I was here on the floor for some time waiting to be able to help him work out something, as far as the time agreement and getting a vote on his amendment, because I think we all are very appreciative of the nature of this amendment and its importance to us for those of us who are on the African Affairs Subcommittee of the Foreign Relations Committee.

Mr. PERCY. I thank my distinguished colleague.

Senator TsoNGAs has been extraordinarily cooperative in many, many areas with the chairman and the ranking minority member of the committee. It was my hope that, in accordance with that

pattern of cooperation and comity that we have had, that we could work out this matter.

I did talk with Senator TsoNGAs and made a proposal to him that if the ceasefire reference was deleted from the committee amendment that I would support it.

A counterproposal for a definite time limitation was made by Senator TsoNGAs. In speaking with Senator Tso~aAs, about it, I indicated that I had given considerable thought to that counterproposal and felt that a time-certain, extended out to, say, December 31, 1983, as was originally suggested, would be too long a timeframe; that I still considered the cease-fire an onerous provision which would, in a sense, put control of our activities in other hands and make it impossible for us to have any degree of freedom of movement.

I, therefore, felt that the counterproposal to set a specific date for repeal of the Clark amendment would not be acceptable. I continued to be troubled by the committee language as it stood.

At the time of the markup, I did not fully appreciate how rigid the requirements for a cease-fire and preparations for elections were. Possibly in retrospect I was not the only Senator in that category. If the phrase were deleted, I could have supported the rest of the language.

I notified Senator TsoNGAS that if this was not acceptable, then my only alternative would be to support Senator KASSEBAUM's amendment which repeals Clark and adds the language from the committee amendment which says:

Nothing in this section shall be construed to be an endorsement . . . of assistance in Angola.

I discussed my feelings with Senator PELL, the ranking minority member, and he was on notice of our discussion and also my concerns.

I regret we were unable to work this matter out. In view of the situation that we are now faced with, where the amendment has actually been offered as a perfecting amendment, I would like to yield at this time to the distinguished Senator from Kansas for any comments that she would like to make and then it would be my intention to move to table the Tsongas amendment.

Mrs. KASSEBAUM. I thank the Senator from Illinois.

Madam President, I would like to respond to some of the issues raised by the distinguished Senator from Massachusetts, because I know that we both are deeply concerned, as I said. about improving relations with the African States and we both seek to see resolved an early independence for Namibia.

But, Madam President, I think there are some ways that this can be achieved other than the suggestion made by the junior Senator from Massachusetts, which, I feel, in many ways is a mischievous suggestion that would, indeed, set back the independence of Namibia.

Madam President, with increasing frequency over the past several years we have been confronted with issues that have taken on a symbolic importance that bears little relationship to their sub-

22524 CONGRESSIONAL RECORD-SENATE September 30, 1981 stantive significance. In most cases, this distortion between substance and appearance arises simply from the passage of time. A real need, addressed in the emotional context of a past time, gives rise to a legislative solution that lingers with us. The legislation, which may have been vital at the time, has diminishing merit when applied to new circumstances. A problem of perceptions is then presented, however, when we must wipe the legislative slate clean.

The so-called Clark amendment is just such a case, Madam President.

Late 1975, when this provision was first enacted, was an extraordinary time. America's faith in its Government had been badly abused. Congress was still feeling the anxiety of a constitutional crisis narrowly averted. Our intelligence agencies were the subject of an agonizing and long overdue public examination. Still fresh in our minds were the television images of the Saigon evacution that brought to a close one of the least understood and ultimately most unpopular wars of our history. It was in this context that the very real threat of growing involvement in Angola was addressed in Congress.

These extraordinary circumstances engendered extraordinary actions. The Tunney amendment, predecessor to the Clark amendment, was just that-extra ordinary. It was an expression of congressional distrust of the Presidency in the execution of foreign policv with regard to a single, specifically named country. Such legislation, if not unique, is certainly not ordinary.

I was not a Member of this body at that time. In fact, less than half of our present colleagues were then serving in the Senate. I do not question the wisdom of the 1975 deliberations. There are clear indications that suggested we were coyertly heading toward a maior and costly involvement in Angola, and equally clear was a popular, informed opposition to such an undertaking. The Tunney amendment may well have been vitally important in avoiding an unfortunate chanter of our history.

That question is not before us now. The issue with which we are now engaged is whether this vestige of the past should be maintained, whether this extraordinary provision will continue to mark Angola as a country requiring a special congressional caution.

Madam President, in conversations with our colleagues as I decided whether to offer a repeal of the Clark amendment._ I found not a single Senator who believed that this provision should be retained solely on the basis of substance. I think the Senator from Massachusetts would agree with that. Those who have conveyed a reluctance to join me in this amendment have principally premised their concerns on the symbolism of repeal. I understand their concerns. I svmpathize with them, and I am trying to minimize any adverse impact that might result from this symbolism. At the same time, I am not persuaded that the pivotal issue of this legislation should be dominated by appearance rather than substance.

•.

Madam President, the administration has constructed and pursued a policy designed to achieve an early realization of independence for Namibia.

We have had several positive signs in the last couple of weeks, one of them being President Moi of Kenya, who spoke specifically of the progress that was being made, as well as Angola had said they saw signs of positive progress in the recognition of action in achieving an independent Namibia.

In some Senators' minds that policy may not be the ideal mechanism. It is, nevertheless, a credible, workable path toward an independent Namibia. It has advanced to the stage that resistance to it can only mean its failure rather than its delay or modification.

There are those foreign leaders who, having watched our foreign policy over the last few years, believe that the policy will be changed through pressure from the Congress. If we give sustenance to this misirnpression in our debate today, we risk inhibiting the successfUil endeavor to reach a peaceful solution to the Namibian problem.

If, in emotional debate, we mislead some African leaders into believing that they may successfully play on a division between Congress and the State Department, we will have contributed to disaster in southern Africa. As chairman of the African Affairs Subcommittee, I do not believe that I am overstating potential damage that is risked in this debate.

At this stage in its development, it is not possible to abandon, defeat, or materially modify our policy on Namibia and reasonably expect some other peaceful solution to emerge. If, in our debate, we encourage resistance and delay am.ong some African leaders, we will be guilty of dangerously misleading them and confounding the very interests we seek to serve.

It has been argued that the time is not right for a repeal of the Clark amendment. I myself had doubts about the administration's timing of its request for a repeal. The timing of this decision bothered me because I feared that it would obscure the bulk of our African policy. That policy provides for an independent Namibia and a socially just South Africa. With this administration, I believe we have an African policy that will finally achieve racial equity to South Africa. I believe that we must and that we will see successful implementation of this goal. I do not want tlack Africa to lose sight of that element of our policy in an emotional, counterproductive debaJte over the Clark amendment.

It is just this desire, to keep African policy on target, that gives rise to my opposition to the committee bill provision on the Clark amendment. The foreign assistance bill, as reported by the committee, apparently links a repeal of the Clark amendment to a Na.mibian settlement. The sad fact we must accept is that there is no perfect time for a repeal of any law such as the Clark amendment. Any government in any country is going to object strenuously to the repeal of a

law specifically protecting them from any hostile acts. If we create a linkage between the repeal of the Clark amendment and a Namibian settlement, then we are creating an incentive for the Angolans and their supporters to withhold cooperation from the international·e1fort to achieve a settlement in Namibia. For the Congress to create such an incentive would seriously undermine American policy efforts in southern Africa.

It is also argued that a repeal of the Clark amendment would hurt American business interests both in Angola and in other African countries. There is clear evidence that this is not the case. President Reagan requested a repeal of the Clark amendment on March 19 of this year. Since then, American business has continued to operate successfully in Angola-as is shown from the July Ex-Im Bank loan to support American exports to Angola.

Behind the rhetoric there has been no significant deterioration between the United States and Africa. The Angolans even recognize that a repeal of the Clark amendment is not the catastrophe it has been portrayed in the press.

I sincerely hope that the Congress will use this session to remove the Clark amendment from the foreign policy of the United States. Last year the Senate accepted a compromise which was rejected by the House conferees. As a result, we have this issue before us again. And, if we do not resolve the issue of the Clark amendment this year, we have it again and again until finally the legal restrictions on the U.S. Government with respect to Angola are brought into line with those carefully considered restrictions and procedures that apply to every other nation.

I would not claim that the President's request for a repeal of the Clark amendment was not without some cost to our overall foreign policy in Africa. But I will claim that we have paid those costs this year, and now that we are halfway there let us continue and remove this thorn from our African policy.

In conclusion, Madam President, I believe a majority of the Senate will agree that the Clark amendment is no longer needed and that a still larger majority believes its continuation would convey a dangerously misleading impression.

I want Senators to know that at the first opportunity following disposition of Senator PERCY's motion to table, I will call up an amendment regarding the Clark amendment.

Mr. PERCY. Madam President, I yield to my distinguished colleague from California.

Mr. CRANSTON. Madam President, I support the language proposed by Senator TsoNaAs which will provide for a date certain for the repeal of the Clark amendment or a ceasefire in Namibiawhichever comes first.

Madam President, I was an original cosponsor of the Clark amendment. I think that we acted prudently in 1976 in enacting the Clark amendment. The Ford administration did not provide the Congress with a well-defined rationale for providing military or paramilitary


assistance to Angola at the time. The administration presented the Congress with the specter of creeping involvement in Angola's civil war without a clearcut reason for why we should provide funds or how it was in the interest of the United States. Without a coherent policy which spelled out U.S. interests, the Congress determined it would be unwise and irresponsible to give the administration a blank check and denied the administration's request. To insure congressional oversight, the Clark amendment was approved which prohibited any assistance related to any military or paramilitary operations in Angola without the express approval of the Congress.

I have continued to follow events in southern Africa carefully since the passage of the Clark amendment. The United States still has important foreign policy objectives in the area. Of particular significance to the United States is a peacefully negotiated settlement for Namibian independence and the removal of Cuban troops from Angola. These two goals are closely intertwined. Angola has stated that the Cuban troops remain because of attacks by South Africa. South Africa justifies the attacks as an effort to stop guerrilla activity in Namibia. Thus, settlement of the Namibian question may bring us closer to our goal with respect to the Cuban troops as well.

President Reagan, however, has asked us to repeal the Clark amendment. Given the changes that have taken place in the last 5 years in southern Africa, it is understandable that he has done so. But, as we debate the issue before us-the repeal of the Clark amendment-we must keep the two goals I have mentioned in mind because repeal of the amendment may well have a profound effect on our efforts to achieve these goals.

President Reagan has asked the Congress to renal the Clark amendment on the grounds that it limits his flexibility to conduct foreign policy. The Senate Foreign Relations Committee agreed to his request but with certain conditions relating to progress on the Namibian question. I supported the committee compromise because it set out the concerns of the Congress about repealing the Clark amendment at this time and provided for appropriate congressional oversight. At the same time, committee compromise responded fairly to tfie President's request. It repealed the Clark amendment. Today, however, we are asked to repeal the Clark amendment with virtually no c0nditions. I am very concerned about the effect that such action will have on the two foreign policy goals to which I have already alluded.

The administration has stated that it has made progress toward a settlement in Namibia. I welcome this news. And I will continue to support the administration's efforts to resolve the Namibian problem. But I am concerned that outright repeal of the Clark amendment now will derail the administration's efforts. I am concerned that repeal now will send the wrong signal to the nations in Africa who have exoressed serious concern about repeal of the amendment and to

our allies-France, Germany, Britain, and Canada-who have been working with us to resolve the Namibian issue. But if we set a certain date as has been proposed, we will be serving notice that it is our intention to repeal the Clark amendment, but we shall give the President time to work out the Namibian settlement.

Madam President, this is a sensible approach. It takes no chance that the success achieved by the administration thus far will be jeopardized. It responds to the President's request. I hope that my colleagues will join me in supporting it.

Mr. PELL addressed the Chair. Mr. PERCY. Madam President, I be

lieve I still have the floor. I am very happy to yield 5 minutes to my distinguished colleague from Rhode Island.

Mr. PELL_. · Madam President, I strongly support the intent and substance of Senator TsoNGAS' amendment. It takes into full account the current situation and the prospect for successful peace negotiations. It is also a good compromise, since it guarantees that the Clark amendment will terminate on a date certain.

Madam President, by this amendment, the Senator from Massachusetts has given full force and effect to the disclaimer of congressional intent on covert operations that is being proposed by the Senator from Kansas. By so doing, it also provides time to conclude the sensitive Namibia negotiations.

Madam President, all parties to the Namibia negotiations-including the American and Angolan Governmentshave stressed the linkage between peace in Namibia and the withdrawal of Cubans from Angola. Outright repeal of the Clark amendment could provide a further rationale for a cont:nued Cuban presence in Angola to ward off possible U.S. covert actions.

Now, more than ever, outright repeal-or even repeal with a congressional disclaimer-would be viewed throughout the world, and particularly in Africa, as an American decision to favor military responses to southern African problems--similar to the recent South African raid in to Angola. This is not a message that we wish to send, and it is not a message that we can afford to send.

At the same time, the Tsongas amendment also realizes that complications can occur and no restrictions on Presidential flexibility in these matters should last forever. The cutoff date established by the Tsongas amendment provides a workable time frame to terminate the Clark amendment.

All told, Madam President, I believe it is a good amendment and I am glad to support it.

The PRESIDING OFFICER. The Senator from Dlinois.

Mr. PERCY. Madam President, I am pleased to yield 3 minutes to the distinguished senior Senator from Pennsylvania. I suggest the absence of a quorum.

Mr. TSONGAS. Madam President, I inquire whether, since we are just going to be sitting here, I could respond and take up the time now, rather than later.

Mrs. KASSEBAUM. Madam President,

I should like to suggest that there is a quorum call in progress.

The PRESIDING OFFICER. Will the Senator from Dlinois withhold his request for a quorum call so the Senator may proceed?

Mr. PERCY. Yes, Madam President. I ask unanimous consent that the request for a quorum call be withdrawn, and that I may yield to the distinguished ·Senator from Pennsylvania without losing my right to the floor.

The PRESIDING OFFICER. Is there objection? Without objection, it is so ordered.

Mr. HEINZ. Madam President, I thank the distinguished Senator from Illinois for yielding.

I am in strong opposition to the Tsongas amendment, Madam President, and I shall be speaking later on in favor of the Kassebaum amendment. This is really a question of one of the first, major foreign policy tests that this new administration has had to date on the floor of the Senate.

Despite that, some people might wonder what the Clark amendment is and, therefore, why it is so significant. Let me sum it up in these words: The Clark amendment is a way of saying to the Soviet Union, to CUba, and to other people who wish to have as large a sphere of influence, as far-flung a net of hegemony, as possible, that we, the United States, declare Angola to be of no significant interest to this country, and that we, by declaring it off limits to our interests, welcome the intrusion, the intervention, the stationing of Cuban troops, or any other kind of activity or action by other people, presumably hostile to our interests, that they care to engage in.

What my good friend, the Senator from Massachusetts, seeks to do in amending the bill is to provide that the Clark amendment be in force until March 31, 1983, extending it some 18 months in so doing; or to provide that certain conditions be met, among them the achievement of an effective ceasefire in Namibia.

Madam President, this is not the time or place to debate our policy in its entirety toward southern Africa, to South Africa, to Namibia, to Angola, to Zimbabwe. But I think it is fair to say the Tsongas amendment gives a veto over our policy in Angola to two contending sides in another area of southern Africa-namely, Namibia. It is a veto because it is going to be up to SWAPO, which is on one side, and presumably the South Africans or people friendly to their interests on the other, as to whether or not a cease-fire is going to exist in Namibia, which in turn will affect the status of the Clark amendment, under the proplosal by the Senator from Massachusetts (Mr. TSONGAS).

Madam President, one does not have to be for SWAPO or for the South Africans to be against giving either of them a veto over our policy in Angola. Yet that is exactly what the Tsongas amendment would achieve. It seems to me, therefore, that this amendment, which goes much farther than the bill, by far,

22526 CONGRESSIONAL RECORD-SENATE September 30, 1981 is not an effective means of signaling either the administration downtown or people across this country or people in southern Africa what it is we believe vital to our interests, security and otherwise, around the world.

So I hope that my colleagues will join in voting for the motion of the Senator from Dlinois to table the amendment. This amendment is wrong, and I hope it will be defeated.

I will speak on the larger issue of repealing the Clark amendment at greater length in a moment, at which point I will urge the adoption of the Kassebaum amendment.

Mr. PERCY. Madam President, it is the intention to vote within 5 minutes. We understand that some Senators are leaving to go to the White House, but they can delay for 5 minutes.

Very simply, the Tsongas amendment is a major modification in the original Percy-Tsongas amendment on Angola. It deletes a good deal of the language of that amendment and adds that the repeal is effective upon the achievement of a cease-fire or March 31, 1983, whichever is earlier.

The Kassebaum amendment repeals the Clark amendment and incorporates the committee language with respect to the intention of Congress-that we were not condoning or endorsing in any way any military or paramilitary activities in Angola. I also intend to work with the Intelligence Committee to assure notification in this regard.

The concerns I have had were primarily two: I felt extremely uncomfortable, and so expressed myself, that ours would be the only government on Earth whose hands would be tied in a critical area. In retrospect we see the problem we have when we try to repeal something like the Clark amendment: we have the danger that we might send the wrong signal.

Senator KAssEBAUM has taken some of the committee language to make clear we are not sending a signal. There is no plan for any such action, but the administration does not feel it should have its hands tied. It would go through the congressionally approved procedure in the event there were such a plan.

With the cease-fire language in the committee amendment relating to the conflict in Namibia, we would be constrained and controlled in our actions by the actions which other countries may or may not choose to take.

Madam President, I ask unanimous consent that I may now yield to the distinguished Senator from Massachusetts for 2 minutes, without losing my right to the floor.

Mr. TSONGAS. I object. Mr. PERCY. I ask unanimous consent

that I be able to yield, without losing my right to the floor, to the Senator from Massachusetts for 2 minutes.

Mr. TSONGAS. I object. The PRESIDING OFFICER. Objection

is heard. The Senator from Illinois has the floor. Mr. PERCY. I ask unanimous consent

that I be permitted. under the conditions outlined to yield to my colleague for 2 minutes.

Mr. TSONGAS. I had promised the Senator from Connecticut that he could speak. I need only a minute, but the Senator from Connecticut has expressed a desire to speak.

Mr. PERCY. It will be necessary because of the commitment I just received from the distinguished Senator that he wished to speak for only 2 minutes. I have asked a group of Senators to hold off going to the White House until we have had the vote.

Mr. TSONGAS. I withdraw my objection.

Mr. PERCY. If the distinguished Senator from Connecticut can give his comments in 1 minute--

Mr. TSONGAS. I withdraw my objection.

Mr. PERCY. Madam President, I modify my unanimous-consent request, that, without losing my right to the floor, I be permitted to yield for 2 minutes to the distinguished Senator from Massachusetts and for an additional minute to the Senator from Connectdcut. I will immediately then move to table the Tsongas amendment.


Mr. TSONGAS. I will use 1 minute and yield 1 minute to the Senator from Connecticut.

Madam President, we are not here to take positions that were arrived at prior to the amendment. The argument about the veto of the cease-fire is important but not if there is a date certain. Why do we not talk about that? If there is objection to the veto power inherent in the cease-fire, that is why the date certain is there. Why do we not talk about that?

The argument that the amendment goes much further than the bill is nonsense. The bill has cease-fire alone. The amendment has the cease-fire and the date certain. To say that it goes much further than the bill means that one has not read the bill and has not read the amendment. Let us deal with the facts here.

I yield to the Senator from Connecticut.

Mr. DODD. I thank the Senator. Madam President, I wish to make the

same point. I believe the Senator from Massachusetts has gone considerably further in the amendment he is now proposing than what was offered in the committee. Providing a date certain 18 months from now is going to assure the elimination of the Clark amendment. However, what the total repeal of Clark would not do is to give Mr. Crocker, to give Secretary of State Haig, to give President Reagan and this administration, and to give Congress the opportunity to exercise positive leverage on Angola, in our efforts to seek a settlement in Namibia.

A dramatic breach or break now with the Clark language will lose us the leverage we desperately need if we are going to have any positive influence on a resolution of that dispute.

I strongly support this compromise. It is a significant compromise. The date certain is something that all of us in this body can support.

.·

I yield back to the Senator from Massachusetts whatever time I have remaining.

Mr. KENNEDY. Madam President I rise in support of the amendment ~ffered by my colleague from Massachusetts <Mr. TsoNGAS) . I believe that his amendment, which calls for the repeal of the Clark amendment, when "the President has determined that an effective cease-fire is in place in Namibia and that preparations for internationally supervised election in Namibia are in progress" or by March 31, 1983, offers an acceptable compromise to those who favor outright repeal of the Clark amendment at this time.

I oppose the amendment to be offered by the Senator from Kansas <Mrs. KASSEBAUM) to repeal the Clark amendment, which prohibits U.S. assistance to military or paramilitary operations in Angola without specific congressional approval.

The Clark amendment was originally enacted in 1976, after Congress learned that the CIA had provided covert military aid and assistance to two of the three contending political parties <FNLA and UNITA) during the 1975-76 civil war in Angola, without the prior knowledge or approval of Congress. This secret operation had only escalated the conflict causing unnecessary additional deat~ and destruction in Angola.

Enactment of the Clark amendment established the firm position in American foreign policy that we could neither promote our own interests nor enhance the prospects of a peaceful solution in Angola by conducting covert operations, apparently in conjunction with the Government of South Africa. In addition, the Clark amendment signified Congress desire to share an equal responsibility in making of foreign policy-a responsibility that could not be fulfilled if the President were given full discretion to act as he saw fit while Congress was informed after the fact. T~e Clark amendment was stringent,

but It was deemed necessary to insure that public debate would take place before any future decisions were made to intervene in Angola. The amendment requires the President to explain in detail why he believes that supplying assistance to Angolan rebels would be "important to the national security interests of the United States," after which the Congress must give its express authorization to any requested aid.

This is the historical context in which we ought to consider our present policy toward Angola. A repeal of the Clark amendment not only would be tantamount to turning the clock back to 1975, but would seriously damage our current diplomatic efforts and interests in Africa in a number of ways.

First, reoeal would be a clear signal to Africa and to the world that the United States was reverting to an African policy viewed primarily in terms of East-West competition, with little concern for African needs and priorities.

Second, repeal would be a severe impediment to any future attempts by the United States to imurove relations with the current Angolan Government--a

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22527 government which has long been recognized by our European allies and our friends in Africa and which has pursued a genuinely moderate course.

Third, repeal would further identify the United States with the racist South African regime, which continues to support the Angolan rebels and which has recently conducted a large-scale invasion of Angola.

Fourth, repeal would add to the widespread impression that American foreign policy is concerned more with military intervention than with diplomatic etforts to protect our international interests.

More specifically, repealing the Clark amendment would undermine three basic U.S. policy objectives in southern Africa and Africa as a whole. First, the peaceful achievement of independence and majority rule in Namibia; second opposing Soviet, Cuban, and East German intervention; and third, improving our ties with nations throughout the African Continent.

With regard to Namibia, lifting the Clark amendment would seriously impair the etforts of the United Nations and the Western Contact Group <Franre Great Britain, West German, Canada, and the United States) to resolve the current crisis. For the past 3% years, the United States has been working closely with the UN and the Contact Group to seek the full implementation of the United N81tions Security Council Resolution 435, an internationally accepted plan which provides for Namibian independence and majority rule.

As a key member of the frontline states and the principal mediator for the forces of the South West African people's Organization <SWAPO). Angola has long played a critical and constructive role in the Namibian negotiations. In the summer of 1979, for example, the late Angolan President Agostinho Neto came forward with a new proposal for a demilitarized zone along the AngolanNamibian border, which broke a deadlock in the discussion on how to implement and monitor the cease-fire between the SW APO and South African forces. In addition, Angola was successful in persuading SW APO to agree to participate in the United Nations-sponsored elections in Namibia.

To repeal the Clark amendment and open the wav for covert U.S. assistance to UNIT A-the primary opposition party dedicated to overthrowing the MPLA government-would decrease the likelihood that Angola would accept proposals either for a demilitarized zone located on its territory or for a cease-fire. Moreover, lifting the ban on CIA paramilitary activity in Angola would be certain to create a chill in relations with the other frontline states and with SW APO. rendering the attainment of a solution acceptable to all parties even more difficult.

Desptte the Reagan administration's claiming, a repeal of the Clark amendment clearly would not lead to a withdrawal or a reduction in the number of Cuban troops in Angola. Instead, repealing the amendment would precipitate further Soviet and Cuban adventurism in Angola by increasing, not diminish-

ing, the reliance the Angolans now have on the Cubans for their security needs.

I strongly oppose the presence of Cuban troops and Soviet military advisers in Angola. But it is clear that it will be difficult to obtain Angola's support for the removal of these troops and advisers until South Africa ends its attacks and its military threat to Angola.

Angola officials have repeatedly stated that they will send home the Cuban troops once the Namibian crisis is resolved and the threat of South African raids has evaporated. In an interview this past January, the Angolan Foreign Minister, Paulo Jorge, reaffirmed Angola's position: "We have said this very clearly to the Americans, when the threat of South Africa disappears and we believe it will with the independence of Namibia, then we won't need the Cuban presence here." If the Reagan administration is serious about its desire for the withdrawal of the Cuban troops and Soviet advisers from southern Africa, it should pursue a policy that will bring true independence and majority rule to Namibia, leading to the end of the Cuban presence in Angola.

Finally, repealing the Clark amendment would have a potentially disastrous etfect on U.S. relations throughout Africa. African nations have made it clear that they oppose the lifting of the Clark amendment or any other attempts by the United States to provide covert aid to UNITA. President Shehu Shagari of Nigeria, whose country is the second largest supplier of oil to the United States, warned that "If the United States is willing to support the rebels in a sovereign African nation, it would be extremely serious." The group of six southern African frontline states-Tanzania, Zimbabwe, Botswana, Mozambique, Zambia, and Angola-forcefully reiterated this position during the April 1981 visit of Chester Crocker, the Assistant Secretary of State for African Atfairs. In a communique issued upon the conclusion of Crocker's visit, the frontline states, "denounced any move on the part of the Reagan administration geared to destabilize the Government of Angola," and added that "such a motion against Angola would constitute a flagrant act of interference in the internal atfairs of a member state of the OAU and the UN and a clear atfront and challenge to free Africa."

U.S. relations with African States would be further damaged by the clear perception of a "tilt" toward South Africa that would be created by a repeal of the Clark amendment. Already, the members of the OAU have condemned what they see as the Reagan administration's greater willingness to tolerate South Africa's racial repression and its dominance over Namibia.

And in the wake of the appalling U.S. veto of the U.N. resolution condemning South Africa's recent invasion of Angola and the administration's decision to allow South Africa's segregated rugby team, the Springboks, to tour the United States, America's relations with Africa have become severely strained.

If we were now to repeal the Clark

amendment, susp1c1ons about U.S. cooperation with Pretoria would only increase, risking complete alienation of the United States from the rest of Africa.

Madam President, I should point out that Africans are not the only one who have voiced their deep concern about the implications of Senator KAssEBAUM's amendment. The American business community has also expressed serious reservations about the far-reaching consequences a repeal of the Clark amendment would have on their business interests in Angola and in the rest of Africa. Last April, when the House Foreign Atfairs Subcommittee on Africa held hearings on the Clark amendment, many leading American businessmen, bankers, and industrialists testified that their facilities and investments in Angola and in other economically important nations such as Zimbabwe ~and Nigeria would be adversely atfected by the Reagan administration's handling of such sensitive issues as the repeal of the Clark amendment, independence for Namibia, and policy toward South Africa. Their view, as expressed by Melvin J. Hill, president of Gulf Oil Corp. unit, is that Angola is a "knowledgeable, understanding and reliable business partner" and that "the U.S. attitude toward one problem atfects the African perception of the positions the U.S. might take in other areas of Africa." He went on to state that repeal of the Clark amendment "would almost certainly be interpreted as a decision by the United States to abandon black Africa and aline itself with South Africa."

Likewise, P. W. J. Wood, vice president of exploration and production for Cities Services Co., advised that-

Time will take care of Angola. The Angolans are m.ore and more development oriented. They aren't interested in politicizing central Africa on behalf of Cuba or the Soviet Union. Our people aren't personna non grata. in Angola..

Madam President, I believe the proposed repeal of the Clark amendment would be a major foreign policy blunder. Such action would severely damage and delay any prospects for a settlement in Namibia. Moreover, it would not lead to a withdrawal of Cuban troops and Soviet advisers based in Angola. Rather, it would enhance Angola's sense of insecurity, increasing-not decreasing-likelihood of a continued Cuban and Soviet presence. Finally, a repeal of the Clark amendment unquestionably would have serious ·repercussions on U.S. relations throughout Africa.

For all of these reasons, I urge my colleagues to support the Tsongas compromise amendment. While I would have preferred that the Clark amendment not be altered at this t!rucial time in the struggle for independence and majority rule in Namibia, I believe that this compromise is acceptable.

Madam President, Africa will be of crucial importance to U.S. foreign policy in the 1980's. We must be certain not to undermine the substantial gains that we have made on that continent since the first Clark amendment was enacted. A total and unconditional repeal of the Clark amendment would be a dangerous


step backward in America's African policy. I urge my colleagues to show the wisdom and the foresight necessary to promote America's long-term interests and relations with the nations of Africa, and to join me in supporting the Tsongas amendment which would help to protect both these goals.

Mr. BRADLEY. Madam President, the debate in the Senate today on whether to repeal or modify the Clark amendment to the Foreign Assistance Act is not simply a question of establishing "in principle" the powers of the President to formulate and implement U.S. foreign policy. It is not simply a matter of freeing "in principle" the President of congressional restraints on his ability to conduct a credible U.S. foreign policy. It is rather a debate on the future of U.S. relations with the nations of Black Africa.

Madam President, there should be no mistake about the consequences of our vote. If the U.S. Congress repeals, without condition, the Clark amendment, which prohibits U.S. military assistance to any of the contending factions in Angola and rejects the Tsongas compromise, it will do the following:

First, it will put Angola, and all 51 members of the organization of African States who recognize the controlling government in Luanda, on notice that the United States is prepared to intervene by supplying forceful means to dislodge a sovereign and broadly recognized government in Black Africa . . Under the circumstances, interventionary action by United States would be seen not as a defensive move against Soviet influence in the region, but as a plainly aggressive effort to remove what it regards as an unpalatable regime. The United States has been repeatedly informed that this is the prevailing view of Black Africa's leadership.

Six southern African States on April 15. 1981, released a statem~nt characterizing a repeal of the Clark amendment as ''a flagrant interference" in Angola's internal affairs and a "clear affront and challenge to free Africa." And no one has been more clear on this point than President Shagari of Nigeria, a country which is the second largest foreign supplier of oil to the United States. In his words, "if the United States is willing to sup~ort rebels in a sovereign African nation, 1t would be extremely serious."

Second, the negative reaction of Black Africa to prospective threats to Angola's Government is strongly motivated by the association of UNIT A, the opposing rebel group led by Jonas Savimbi, with the Government of South Africa. Savimbi's personal qualities of leadership and commitment to Angolan independence have been completely eclipsed by his cooperation with South Africa in its assaults on Angola, and more importantly on SWAPO, the Namibian independence movement supported by Angola.

South Africa's ambitions concerning Namibia are widely recognized to be to thwart the emergence of Namibia from South African mandate as an independ.:. ent, majority-ruled nation. Savimbi's cooperation with the South African Gov-

ernment, a government reviled for its practice of apartheid and its attacks on SW APO forces, has completely discredited Savimbi's UNITA with the nations of Black Africa. Accordingly, signs that the United States is prepared to give military assistance to Savimbi, in the eyes of Black Africans, are signs that the United States is prepared to support South Africa in its plans to squash independence for Namibia. Since undermining prospects for a peaceful settlement is contrary to U.S. commitments under a 3 year UN-sponsored peace effort, support for South Africa's intransigence and aggression is not the posture we should appear to adopt. Repealing Clark without any conditions and rejecting Tsongas would without question cast us in that posture.

Third, giving Luanda reason to believe we plan to aid Savimbi and South Africa is the worst way to seek to dislodge Soviet and Cuban influence in Angola. Indeed no better plan could be drawn up to entrench the reported 20,000 to 30,000 Cuban troops defending Angola's economic infrastructure against the repeated attacks on it by UNITA and South Africa.

Every indication out of Luanda points to the Government's disappointment in Soviet failure to help improve the country's economic lot and its impatience to be free of the irritating Soviet and Cuban presence in its homeland. In contrast to its economic relations with the East, Luanda's economic contacts with Western firms have grown steadily and productively. While Angola carries on hardly any trade with countries of the Eastern bloc, its economic ties to the West are becoming critical. Oil is the country's biggest export and generates most of the country's revenues. Gulf Oil is Angola's largest oil producer. Notably, Luanda's posture toward Western governments, including the United States, has improved in concert with the strengthening of its economic ties to them.

The obstacle that stands between the United States and Angola is the politically-charged matter of Cuban troops. The best prospect for removing them is to remove Angola's reason for retaining them. Acting to increase the threat to the Angolan Government is the surest way to make the Soviet Union and Cuba indispensable to the Angolans.

It is important to take notice of precedents as a gUide to what might follow the easing of Luanda's security concerns. Angola has repeatedly declared that it will send the Cubans home once it is assured of its safety from South African s1;onsored attack. It is worth noting that before Angola and Zaire made peace in 1978. 35,000 Cuban troops were stationed in Angola. It has been reported that after Mobutu expelled FNLA forces opposing Luanda from Zaire, and Angola returned Zairian refugees to Mobutu, the number of Cuban troops in Angola dropped by some 50 percent, according to W~tern intelligence analysts.

Prospects for improved relations with Luanda are very good. And progress in improving them could enhance U.S. in-

:tluence in the region generally, while dilllinishing Soviet opportunities for gain.

Finally, Madam President, it should not escape our notice that the negative view of repealing the Clark amendment extends far beyond Black Africa to most countries of the developing world generally. The Namibia-South Africa question of course is not so stirring for those outside the African continent, but evidence ot' our respect--or seeming lack of respect-for the driving aspirations of Black African people will weigh importantly with all peoples of the developing world. The effect will be subtle and indirect, but nonetheless significant. Our relations with these countries bear improvement for reasons of important economic and security interests. Can it be wise to needlessly alienate-and perhaps alarm-them by appearing to trespass on Black African sovereignty and dignity?

I do not think so, and I am pleased that the distinguished Foreign Relations Committee, in reporting the TsongasPercy compromise on the Clark amendment., did not think so either. That compromise repeals Clark but makes military assistance to factions in Angola contingent on a reported Presidential determination that assistance is in the national interest; that concrete progress has been made on a Namibian settlement; and that assistance would not im}:'air settlement efforts. The compromise approach retains congressional oversight, strengthens the President's foreign policy capabilities, but minimizes the danger that aid to UNITA will be used to strengthen joint UNITA-South African assaults on SWAPO.

Madam President, the committee compromise is a balance that restores the President's ability in principle to take whatever measures necessary to advance U.S. interests, while taking care to avoid creating the impression that the U.S. hopes to launch a covert effort against Angola, a covert effort that would collapse hopes for a negotiated settlement on Namibian independence. What the compromise assures is that the cloud of controversy surrounding Namibia, which distorts U.S. relations with Angola, will be fully cleared before the President considers military support.

Madam President, this is a good compromise and the Senate should support it. However, my colleague from Massachusetts has offered a further compromise in an effort to accommodate the concerns of those Senators who fear that the conditions for repeal are open-ended. He has added a provision setting March 1983 as a date certain for repeal of the Clark amendment. If a settlement on Namibia has not come sooner. My view is that the committee provision furthers progress on Namibia and quiets the fears of Black African people about U.S. intentions in their homelands, but I urge those of my colleagues who feel they cannot support the committee provision, to accept the good faith compromise offered by the distinguished Senator from Massachusetts.

Mr. PERCY. Mr. President, if no other Senators wish to speak, I move to table

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22529 the Tsongas amendment, and I ask for the yeas and nays.


The yeas and nays were ordered. The PRESIDING OFFICER. The ques

tion is on agreeing to the motion of the Senator from Illinois. On this question the yeas and nays have been ordered, and the clerk will call the roll.

The legislative clerk called the roll. Mr. STEVENS. I announce that the

Senator from Washington <Mr. GoRTON), the Senator from New Mexico <Mr. ScHMITT), and the Senator from Connecticut (Mr. WEICKER) are necessarily absent.

Mr. CRANSTON. I announce that the Senator from Hawaii <Mr. INOUYE) and the Senator from Hawaii <Mr. MATsuNAGA) are necessarily absent.

I further announce that, if present and voting, the Senator from Hawaii <Mr. MATSUNAGA) WOUld vote "nay."

The PRESIDING OFFICER <Mr. COHEN). Is there any other Senator in

. the Chamber wishing to vote? The result was announced-yeas 66,

nays 29, as follows: [Rollcall Vote No. 299 Leg.]

YEA8-66 Abdnor Andrews Armstrong Baker Bentsen Boren Boschwitz Burdicl;: Byrct.

Harry F ., Jr. Cnnnon Chatee Chiles Cochran Cohen D'Ame.to Danforth DeConcind. Denton Dole Domenicl Dul'enberger East

Ex on Gam Goldwater Grassley Hatch Hawkins Hayak.awa Heflin HeinE Helms Hollings Humphrey Jackson Jepsen Johnston Kassebaum Kasten Laxalt Long Lugar Mattingly McClure Melcher

NAYS-29 Baucus Glenn Biden Hart Bradley Hatfield Bumpers HudcL.eston ByTd, Robert c. Kerunedy Cranston Leahy Dixon L<'vin Dodd Mathias Eagleton Metzenbaum Ford Mitchell

Murkowskt Nickles Nunn Packwood Percy Pressler Quayle Randolph Roth Rudman !3asser Simpson Strafford Stennis Stevens Symms Thurmond Tower Wallop warner Zorinsky

Moynihan Fell Proxmire Pryor Riegle Sarbanes Specter Tsongas Williams

NOT VOTING-5 Gorton MJatsunaga Weicker Inouye Schmitt

So the motion to lay on the table Mr. TsoNGAs' amendment (UP No. 446) was agreed to.

Mr. BAKER. I move to reconsider the vote by which the motion was agreed to.

Mr. SIMPSON. I move to lay that motion on the table.

The motion to lay on the table was agreed to.

Mr. MITCHELL addressed the Chair. The PRESIDING OFFICER. The

Senator from Maine. Mr. MITCHELL. Mr. President, what

is the pending business? The PRESIDING OFFICER. The

pending business is the amendment of the Senator from Maine.

Mr. MITCHELL. Mr. President, I yield 2 minutes to the Senator from Connecticut.

Mr. PERCY. Mr. President, if the Senator will yield, for the benefit of the Senate I might outline our procedure now. The pending business, as I understand it, is the Mitchell amendment. It is the intention of our distinguished colleague to eliminate the wording about a 60-day limitation, which would then remove the objections from this side. The amendment could then be accepted.

Then Senator KASSEBAUM would move her amendment. It is the understanding of the managers of the bill that there will be no objection to a voice vote on the Kassebaum amendment. The only Senator who has requested permission to speak on the Kassebaum amendment is Senator GoLDWATER, who will speak for a few minutes, then we will go immediately to a voice vote.

Mrs. KASSEBAUM. If the Senator will yield, Senator NuNN would like a few seconds on that.

Mr. PERCY. We would then have two Senators speaking and then we would go to a voice vote on that.

It would be our intention to proceed on the bill until at least 6 or 7 o'clock to take up as many amendments as we possibly can, hopefully the noncontroversial ones, so that we can dispose of the majority of those this evening and then work toward some of the amendments that would take a longer period of time. We would attempt to establish a time agreement on all amendments, including the Glenn amendment with respect to Pakistan, which may require 3 or 4 hours. I thank my distinguished colleague for yielding.

The PRESIDING OFFICER. The Senator from Maine.

Mr. MITCHELL. Mr. President, I yield 2 minutes to the Senator from Connecticut.

Mr. DODD. Mr. President, I thank the Senator for yielding.

Mr. President, I rise to strongly support the amendment offered by our distinguished colleague from Maine, urging the administration to fill the position of Assistant Secretary of State for Human Rights and Humanitarian Affairs.

Last May the Committee on Foreign Relations rejected the President's nominee for this position. Dr. Lefever's nomination and the Senate Foreign Relations Committee action leading to his withdrawal was surrounded by controversy.

This controversy unfortunately overshadowed those essential issues that needed clarification in our human rig!ht.s policy. Wha;t I have found most unfortunate was the attempt by some supporters of Dr. Lefever to use the question of his fitness for the office as an excuse to degrade the whole institution of human rights into a "us-ag·ainstthem" partisan issue.

Mr. President, I refuse to accept that human rights is a partisan issue and deplore those who try to exploit it as such. Dr. Lefever was not rejected because of partisan considerations. He was rejected because he was unfit for the office that he was nominated for. Because of the bitterness that controversy unfortunate-

ly generated I do not wish to dwell on it. I just wanted to remind my colleagues that Dr. Lefever was rejected by the majority of each side of the committee. It was clearly a bipartisan decision.

Every Member of this body is deeply concerned about several human rights violations abroad even if the areas of those individual concerns do not always coincide. Our Government a few years ago started t·o institutionalize our human rights policy and handle it in a systematic, coherent fashion. If it did not work perfectly-and what does work perfectly ever: It is up to us to show us how to do better.

There are many theoretical and practical quesbions about our human rights policy 'that have never been solved or clarifi<ed. The debate should shift to these, the really relevant questions instead of getting mired down in partisan bickering.

The President is free, after all, to nominate someone who is close to him philosophically. The unanimous confirmation of our new Supreme Court Justice shows that Members of the Senate are easily capa;ble to rise above partisan and ideological pettiness.

I refuse to believe that the President could not find an outstanding individual witih the knowledge, integrity, and sensitivity required by this post.

The present inaction resulting from the Lefever controversy, this impoundment of the office is unbecoming to the importance and dignity of the subject. It does not hurt personally anyone who voted against Dr. Lefever but it hurts the coherence of our foreign policy.

We do have human rights considerations incorporated into our foreign policy now, and we shall continue to have them. The only question is if it will be a series of haphazard pot shots or a welldefined purposeful policy.

I commend my colleague from Maine for the thoughtfulness of his amendment and its elevated tone.

I ask unanimous consent that the two letters pertaining to Mr. Lefever be printed in the RECORD.

There being no objection, the letters were ordered to be printed in the REcORD, as follows:

JULY 15, 1981. Hon. ALEXANDER M. HAIG, Jr., Secretary of State, Department of State, Washington, D.C.

DEAR MR. SECRETARY: You may recall that during your appee.r·ance on July 8 before the Committee, Senator Dodd requested that we write to you on behalf or the Committee to inquire about (1) Dr. Ernest Lefever's status with the Department of State; and (2) the Administration's intentions with respect to the position of Assistant Secretary for Human Rights and Humanitarian Affairs.

In this regard, we would very much appreciate the Department's responses to the following specific questions submitted by Senator Dodd.

1. What is Dr. Lefever's exact relationship to the Department or State and what are the terms or this relationship? Could you cite which legal authority you plan to use in order to hire Dr. Lefever? Does Dr. Lefever have a formal contract with the Department? If so, we would appreciate your providing a copy of it to the Committee, along wl th any other documentation which the Department deems relevant.

22530 CONGRESSIONAL RECORD-SENATE September 30, 1981 2. What are Dr. Lefever's specific Ml!lign

ments, duties and title? To whom does Dr. Lefever report and how often? Wlll any of Dr. Lefever's work product be available to the Committee and to the public?

3. What other positions, if any, does Dr. Lefever hold either in or out of government? Are there any restrictions in this regard?

4. Does t.he Administration intend to fill the position of Assistant Secretary for Human Rights and Humanitarian Affairs? If so, when would you expect a decision on a nominee? If not, could you inform the Committee of the Administration's reasons for deciding not to fill this post?

5. If the Administration does not intend to fill this position, will it seek legislation to abolish the post? Would the Administration oppose a Congressional initiative to abolish it?

We appreciate very much your wlllingness to be of help in responding to these questions.

Sincerely, CHARLES H. PERCY,

Chairman, CLAmORNE PELL,

Ranking Minority Member.

DEPARTMENT OF STATE, Washington , D.C., August 14, 1981.


U.S. Senate. DEAR MR. CHAIRMAN: This iS in response to

your letter of July 15 to Secretary Haig inquiring about Dr. Ernest Lefever's status with the Department of State and the Administration's intentions with respect to the position of Assistant Secretary fo·r Human Rights and Humanitarian Affairs. Specifically, we are providing the following responses to your questions:

1. What is Dr. Lefever's exact relationship to the Department of State and what are the terms of this relationship? Could you cite which legal authority you plan to use in order to hire Dr. Lefever? Does Dr. Lefever have a formal contract with the Department? If so, we would appreciate your providing a copy of it to the Committee, along with any other documentation which the Department deems relevant.

Dr. Lefever has been appointed as a consultant to the Office of the Secretary of State. The appointment is effective for one year beginning on June 29, 1981. The grade and salary of the appointment are EF-15 (10) p.a. $50,112.50 . Dr. Lefever wm be paid on a daily basis, when actually employed, under the consulting arrangement. Dr. Lefever's appointment forms estimate that he wm work approximately 45 days during the consulting year, although it should be noted that a consultant may work up to a maximum of 130 days during the consulting year. The legal authority to appoint experts and consultants is contained in 5 USC, Section 3109, and the current a"()propriations legislation, as implemented in State Department regulations at 3 FAM 1514. Attached for your information is a copy of the position description on Dr. Lefever.

2. What are Dr. l ·efever's specific assignments, duties and title? To whom does Dr. Lefever report and how often? Will any of Dr. Lefever's work product be available to the Committee and to the public?

Dr. Lefever does not have a title, other than the generic title as a consultant to the Office of the Secretary. His duties are set forth in his position description. Dr. Lefever has not yet been asked to perform any specific assignments on behalf of the Department. However, it is contemplated that he will be asked to consider wavs in which counter-terrorism programs might be improved internationally. Dr. Lefever performs assignments at the request of the Secretary of State, but for administrative purposes he

re;>orts to the Under Secretary for Management. His work product will be available to the Committee , as desired, in accordance wi.th the rules governing the provisions of documents to the Committee and with due regard to the protection of classified material. Unclassified material may be made available to ~he public in accordance with the Freedom of Information Act.

3. What other positions. if any, does Dr. Lefever hold either in or out of government? Are there any restrictions in this regard?

We know of no other positions within the government which are held by Dr. Lefever. Outside the government, Dr. Lefever is the President of the Ethics and Public Policy Center as well as a professorial lecturer in the Department of Government at Georgetown University. All special government employees, including Dr. Lefever, are under certain restraints regarding matters on which they may work within the Department or which are pending before the Department. In brief, these restrictions are that special government employees may not participate in any matters where there are potential or even possible apparent conflicts with their own financial interests or those of family members.

4. Does the Administration intend to fill the position of Assistant Secretary for Human Rights and Humanitarian Affairs? If so, when would you expect a decision on a nominee? If not, could you inform the Committee of the Administration's reasons for deciding not to fill this post?

The manner of organization within the Department of State for the conduct of human rights and humanitarian affairs activities is under study. The study has as its purpose to determine how these functions within the Department can be performed most effectively. The Committee may be assured that the full requirements of the law regarding the conduct of human rights activities will be met.

5. If the Administration does not intend to fill this position, will it seek legislation to abolish the post? Would the Administration oppose a Congressional initiative to abolish it?

Until the aforementioned review is completed the question of whether legislation will be sought to abolish the post is moot. Similarly, until the review is completed, we would not be prepared to comment on any Congressional initiative to abolish the position of Assistant Secretary for Human Rights and Humanitarian Affairs.

Thank you very much for your interest. Sincerely,

RICHARD FAIRBANKS, Assistant Secretary for

Congressional Relations.

CONSULTANT TO THE SECRETARY DUTIES

To advise the Secretary of State on terrorism, counterterrorism and nuclear nonproliferation matters, and on the cohesiveness of State Department policy in these areas. ·

Additionally, incumbent will advise the Secretary on such other matters relating to the conduct of foreign affairs as the Secretary may request, and will assist on whatever speclal projects the Secretary may direct.

AMENDMENT NO. 561, AS MODIFIED Mr. MITCHELL. Mr. President, prior

to the intervention of the Tsongas amendment, the chairman of the Foreign Relations Committee and the minority manager of the bill and I engaged in a discussion regarding objections by the chairman to one clause in my amendment. That clause is contained in subsection (b) (2). The words which the chairman suggested be deleted, I now

agree to be deleted, I, therefore, ask that the clause in subsection (b) (2) in the first sentence, the words "not later than 60 days after the date of enactment of this act," be stricken from the amendment.

Under those circumstances, it is my understanding that the amendment is acceptable to the majority manager of the bill and to the minority manager of the bill. Am I correct in that?

Mr. PERCY. That is a correct assumption. I wish to take into account and call attention to the colloquy that was carried on that would define what the steps of the Senate would be in this regard; that is, the majority of the Senate, in harmony with the understanding of the managers of the bill.

I thank my distinguished colleague for the amendment. We have no objection to the amendment.

Mr. MITCHELL. Mr. President, I wish to make a brief additional comment regarding that colloquy, and that is to repeat and restate and reemphasize that this amendment says to the President that the U.S. Congress believes this is an important office, established by statute, and that it ought to be filled, that it has gone unfilled for 8 months, that the vindication of human rights is an important part of American foreign policy, it is central to American ideals and it ought to be filled promptly. The chairman of the committee and the ranking minority member have agreed that 60 days from now is a reasonable time within which th;s position should be filled.

I want to repeat what I said earlier, Mr. President, that in the event that no action is taken within 60 days, it is my intention to renew this effort with a specific deadline at that time, I would hope and expect that I would have the support of the chairman and the ranking minority member, both of whom have made strong statements in support of this principle here today.

Mr. PERCY. Mr. President, I thank my distinguished colleague for the opportunity to comment. Certainly, we all know that there are certain Senators who would like to see this position abolished and others who want it filled with someone who would meet their exact standards and definition of human rights. So we are not without differing opinions in this area.

It is my judgment that the majority of the Senate would feel that this is an important post and that this is not the time to send the wrong signal to the world by requesting abolition of the position.

I would hope that it would not be necessary, 60 days after enactment of this measure, to require any additional legislation on this issue. I would hope that, in the spirit of comity that has been expressed, we can work with the administration to fill this post. Certainly, we will begin bv discussions tomorrow with Secretary Haig, to impart directly to him the feelings of the Senate and to try to work this matter out in the spirit of cooperation.

Mr. MITCHELL. Mr. President, I share that hope, of course. That would then achieve the objective of this amendment.

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22531 I really wanted to point out that if,

after having received this expression of congressional intention, the administration persists in refusing to fill it, then it seems to me the case will be irresistible for this type of amendment in 60 days, notwithstanding the understandable concern of the chairman and others with imposing specific guidelines. I thank the chairman and I thank the Chair.

The PRESIDING OFFICER. The Chair will state that the Senator has a right to modify his amendment at any time. The Senator desires to so modify his amendment. Without objection, it is so ordered.

The amendment <No. 561), as modified, is as follows:

On page 84, between lines 2 and 3, insert the following: "NOMINATION FOR THE POSrriON OF ASSISTANT

SECRETARY OF STATE FOR HUMAN RIGHTS AND HUMANrrARIAN AFFAmS

"SEc. 716. (a) The Congress finds that"(1) the United States has long been a

leading defender of the basic rights of persecuted, oppressed, and endangered people around the world, and should continue in this role; and

"(2) effective foreign policy formulation requires that the President and the Secretary of State possess current and accurate information derived from continuous observation and review of all ma:tters pertaining to human rights and humanitarian affairs (including matters relating to refugees, prisoners of war, and members of the United States Armed Forces Inissing in action) .

"(b) It is the sense of the Congress that-"(1) a strong commitment to the defense

of human rights should continue to be a central feature of American foreign policy; and

"(2) the President should submit to the Senate the name of a nominee for the position of Assistant Secretary of State for Human Rights and Humanitarian Affairs, as established by section 624(f) o! the Foreign Assistance Act of 1961.".

On page 84, line 4, strike out "SEc. 716." and insert in lieu thereof "SEc. 717.".

Mr. MITCHELL. Mr. President, I believe it is now appropriate to move the amendment.

Mr. PERCY. The modification is a desirable modification. I express my appreciation to the Senator.

The PRESIDING OFFICER. The question is on agreeing to the amendment, as modified.

The amendment <No. 561), as modified, was agreed to.

Mr. MITCHELL. I move to reconsider the vote by which the amendment was agreed to.

Mr. PERCY. I move to lay that motion on the table.



(Purpose: Repeal of the Clark amendment)

Mrs. KASSEBAUM. Mr. President, I send to the desk an unprinted amendment on behalf of myself and the Senator from Georgia <Mr. NUNN) and ask for its immediate consideration.


The legislative clerk read as follows: The Senator from Kansas (Mrs. KAssE

BAUM), !or hersel! and Mr. NUNN, proposes an unprinted amendment numbered 447.

Mrs. KASSEBAUM. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.


The amendment is as follows: On page 64, line 16, after the period fol

lowing the word "Angola" strike out all over to and including the word "Angola" and the period after it on page 65, line 20.

Mrs. KASSEBAUM. Mr. President, I ask unanimous consent that the following Senators be added as cosponsors: Senators BAKER, PERCY, GOLDWATER, HEINZ, PRESSLER, and SIMPSON.


Mrs. KASSEBAUM. I also believe the Senator from Arizona, Senator GoLDWATER, desired to speak for a few minutes. I will be glad to yield at this time.

The PRESIDING OFFICER. The Senator from Arizona is recognized.

Mr. GOLDWATER. I thank the Senator for yielding.

Mr. President, I support this amendment. I was in the southern part of the continent of Africa when the Clark amendment was passed. It was the most shocking thing that ever happened to me as a U.S. citizen while I was overseas.

I had been in Angola a short time before, a few hours. We were within 36 hours, Mr. President, of getting the Cubans and the Russians out of Angola when the Clark amendment passed. It made it impossible for us to continue our work, although it was of an overt nature, in Angola.

Had the Clark amendment not been adopted, Angola today would still be the most prosperous in the continent of South Africa, as she was under the guidance of Portugal and as she was under her own guidance.

Today, it is a different story. Angola is a strife torn country. She would be friendly to us, and, with her minerals, she would be a great asset to us because some of the minerals she has in rather copious quantities are minerals that we do not have. Let me stress that. We cannot make stainless steel in this country today because we do not have the four metals that we need that go into stainless steel. We do get some of them from Angola.

I was also in southwest Africa or what we want to call Namibia. I went up there for the purpose of visiting with those people who wrote the Constitution, all black. Ninety percent of the people are black. There are many, many tribes, almost too numerous to count. About 10 percent of the people over there are white.

This Constitution that I was privileged to read and discuss with the black people who wrote it, to me was comparable to our own Constitution, which I consider to be the best that has ever been prepared in the field of government in the history of the world.

Mr. President, now we get to this organization called SW APO, Southwest African People's Organization. Within 2 days after I had a long visit with the man who

was the chief writer of the Constitution he was murdered by SW APO, and they made no bones about it. They admitted it. It was in the press. I brought back a list that I obtained in southern Angola and made it available to our authorities a list of other people they were going t~ murder. This has been 7 or 8 years ago and I have not kept up with whether they kept their promise or not.

This SW APO organization is really the bone of contention. What drives me up the wall is to hear some of our so-called allies and friends in the United Nations hurling epithets at the United States for not wanting to go over and make a deal where SW APO would run Namibia.

SW APO may not be under the donti·· nation of the Soviet Union, but sw APO is furnished arms by the Soviets. SW APO works in concert with Cuba with their troops, to fight the South Africans who occasionally go into Angola and attempt to drive those people out.

Mr. President, if this amendment is passed and we can do away with the Clark amendment, then I think we can see the United States taking the lead in getting a free election in the country to be called Namibia, a constitution that every one of us in this body would be proud of would be adopted, and South Africa would have every reason, as I believe she wants to, to get out of that country because it is taxing to her to have her forces engaged in that extra part of the world.

It is a wild country. I have to say that. It has some metals, uranium, diamonds, but it is mostly a bleak, desert type of country, not unlike the part of the world that I live in.

So, Mr. President, I support this amendment of Senator KASSEBAUM fully. I think it is long, long overdue. I am amazed that this body would ever have passed it, but they did. It was my unfortunate experience to have been in that part of the world and to take the abuse I took because Senator Clark o:ffered this amendment. It did not even sound good if you read it on the floor. It would not sound good today. We do not need that kind of legislation in this country.

If we are going to be a world power, and that is what I think we are, we are going to have to have the muscle in the President's office to do the things that he has to do to make the United States act like a world power. When you tie his hands at every turn, when you say to the President, ''No, you cannot do that, it will violate this or violate that," then we are not playing the role in this world that most of the world wishes we would, and I think all Americans wish that we would.

I cannot commend the amendment too highly. I cannot congratulate the Senator from Kansas too highly. It is a brilliant stroke.

My experience with women in politics has been exceedingly pleasant. I congratulate the Senator and I support the Senator.

Mrs. KASSEBAUM. I thank the Senator. I appreciate those remarks because, one, I know of the Senator's longstanding interest and concern in Africa and its

22532 CONGRESSIONAL RECORD-SENATE September 30, 1981 future, and, two, the Senator's kind support for me.

Mr. President, I yield to the Senator from Georgia.

Mr. NUNN. I thank the Senator from Kansas. I join with Senator GOLDWATER in congratulating the Senator from Kansas for this amendment, and also for a statement that reflects both her wisdom and sensitivity on this overall issue. She has reviewed both sides and looked at it very carefully. She has expressed her sentiments in a way that makes absolutely clear the foundation from which she is making this proposal. I am proud to be a cosponsor.

As Senator KASSEBAUM has pointed out, opposition to repeal of the Clark amendment is dictated mainly by doubts about the perceptions that might be created by repealing this measure at the present time. I agree that timing is most important in diplomacy and foreign policy, but Senator KASSEBAUM has presented powerful arguments for proceeding with repeal now rather than facing this same issue every year. I commend her for a clear and convincing presentation.

I believe the Clark amendment places overly rigid constraints on any administration's ability to conduct an effective foreign policy, whether it be President Reagan, President Carter, President Ford, or whoever may be President in the future. Its requirements may delay and possibly frustrate our ability to act in circumstances demanding a response from the United States. Our major adversaries have demonstrated that they intend to act in an unconstrained manner in many Third World areas, especially when U.S. policies create a vacuum. The activities of Cuban troops in Angola and in other parts of Africa represent only one example of the adventurism of the Soviets and their proxies that has been encouraged by selfimposed restrictions such as the Clark amendment.

Repeal of the Clark amendment does not imply support for any type of intervention in Angola. Instead, it merely restores the ability of U.S. policymakers to consider the full range of foreign policy options to complement our diplomatic efforts. This is the situation in other areas of the world, and it should be the case in Angola. If our foreign policy is to have credibility, we cannot impose such rigid constraints on ourselves.

In addition to the question of general principle involved in this debate, repeal of the Clark amendment should have a positive impact in U.S. policy in Africa. The objectives of a U.S. policy in southern Africa, including a just settlement in Namibia, are not likely to be realized so long as the United States has on its books certain restraints that constrain us without in any way affecting either the Soviets or the Cubans in Angola. If we are to be concerned about the signals we might be sending, we should recognize that repeal would send a clear signal to all those in the world who are interested in this area, as well as to the Soviet Union. that we view the continued presence of 20,000 Cuban

troops as a serious impediment to any kind of peaceful solution in southern Africa.

I do believe, Mr. President, that this is the appropriate time to take this step. I know that any kind of change in policy will be subject to a great deal of debate and that people, in all sincerity, believe that this is not the right time for repeal ot this amendment. But I do not believe we are going to find an appropriate time for repeal. I think the Clark amendment itself signals to the world a kind of inflexibility in American foreign policy and a kind of restriction that simply· should not be imposed on any President of the United States.

Mr. President, I believed this strongly when President Carter was in the White House. There was never any major effort to repeal the Clark amendment during that time, but I do know that many in the Carter administration considered this amendment an impediment to an effective foreign policy. I am not speaking of anyone in particular, but I think this is a bipartisan matter, and I think it should be resolved. We should work carefully with President Reagan and others in the administration to shape a meaningful policy in Africa that will help bring about a solution to the problems in this part of the world. I am committed to a balanced policy and a constructive role for the United States in southern Africa, including support for a peaceful solution in Namibia, and I view the amendment by Senator KAssEBAUM as a step in the right direction. I thank the Senator from Kansas.

Mrs. KASSEBAUM. I thank the Senator from Georgia for his cosponsorship and for his thoughtful comments.

Mr. HEINZ. Will the Senator yield? Mrs. KASSEBAUM. I am happy to

yield to the Senator from Pennsylvania. Mr. HEINZ. Mr. President, I thank the

Senator from Kansas for yielding. I shall not take much of the time of my colleagues.

Mr. President, I support the amendment of the Senator from Kansas <Mrs. KASSEBAUM) With respect to the Clark amendment. Because the situation in Angola is a matter of long-standing interest to me and one which I have raised on the Senate floor in the past, I want to take a few minutes at this point to detail my reasons for supporting repeal of the Clark amendment.

Let me begin by emphasizing that repeal of this provision neither authorizes nor endorses assistance in any form to anybody in Angola, either the existing government there or the force of UNITA. This distinction is worth making most clearly because I, along with many other Senators, would have serious reservations about taking that second step in this troubled region. When I spoke on this subject in June, 1980, I opposed recognition of or assistance to the MPLA government in Angola unless that government had made progress in reducing the Cuban influence in the country. I took that position at that time in part because there was some consideration being given within the Carter administration to taking that action, which I continue to feel would be inappropriate

without some progress on the Cuban issue.

At the same time, however, I would also have serious reservations about providing assistance-covert or direct-to UNITA and its leader, Jonas Savimbi. The policy of the Reagan administration. as I understand it, continues to be that there should be an internal settlement among the various forces contending for power in Angola and that UNITA and Savimbi should be a part of it. This is not that different in substance from previous U.S. policy, and I support it. However, it is difficult for me to see how U.S. support to either side will hasten a settlement.

It is more likely that our backing will result in perceived tilting of the balance there that will harden the positions of both sides and make them even less inclined to deal with other than they are now. Moreover, U.S. assistance to UNITA would almost certainly encourage the MPLA to increase its reliance on Cuba, the very result we most want to avoid.

As I have indicated, however, repeal of the Clark amendment is a different issue . from the question of assistance. Repeal would remove from our laws one of those cumbersome provisions that most Members of Congress privately believe is not the best way to do business, but which we periodically support as the only way of forcing the administration o-f the time to follow congressional policy direction. Like all such provisions the Clark amendment is a blunt tool when a finer surgical instrument capable of dealing with the problem in a more subtle way is needed. The executive has such finer tools, and if the Congress can reach agreement as to how they are to be used in this case, there is no point in keeping in the law relics like the Clark amendment.

With respect to our policy in Angola, the debate on the Clark amendment has largely revolved around the question of signals and perceptions. What kind of signal does repeal send to the rest of Africa? How will black African States like Nigeria perceive this action, and what, if anything, might they do in return? Do we not, the question is asked, risk undoing the goodwill built up in past years in these states through repeal?

The quick answer to those particular questions is "yes." But that is neither the only answer, nor are those the only questions that should be asked. Clearly repeal of the Clark amendment will result in a sharp, adverse reaction in the rest of Africa which will damage some painfully developed relations.

A somewhat broader view of the issue, however, would also take into account whether or not we follow up repeal with 3Ubstantive action in Angola, which the administration has indicated it does not plan. And it will consider the prospect of further progress on Namiba. The reality in southern Africa today is that the United States is the only Na:tion in a po3ition to move South Africa on the Namibi-an question and, therefore, is the only nation capable of achieving a settlement. That is the most important issue in the region right now, and it is fair to say that progress made there will outweigh a symbolic action like repeal of the Clark amendment.

I·


This is not to say that I view the Namibian question as resolved or even that I think our present policy is on the right track. It is to say that we are in a position to more than compensate for the ill effects to repealing the Clark amendment by helping to achieve 1a settlement that will produce an independent Namibia. Conversely, of course, our failure there will compound our difficulties elsewhere in Africa.

The question of the signal sent to black Africa, however, is not the only question. We must also consider the signal sent to our allies and to the Eastern bloc, particularly the Soviet Union and Cuba. In that regard, the Clark amendment itself has already sent a clear signal-that we intend to keep hands off Angola, and by implication that by implication that we are thereby giving everyone else a free hand there. By defining Angola outside our national interest, we have invited the Soviets to include it Within theirs, and that is precisely what they have done.

Repeal of the Clark amendment would change this message and signal to the Soviets and to our own allies that we do not intend to simply opt out of certain segments of the globe, but that we will take a somewhat broader and more realistic view of our interests. This is not to suggest that we have an interest in having an influence in Angola commensurate with what the Soviets and the Cubans have now. On the contrary, our interest is in peace and stability in Angola and all of southern Africa, conditions which can best be achieved in the absence of foreign powers. Time after time throughout the world Soviet involvement has brought both economic disaster and political turmoil. By unilaterally removing ourselves from the field, we only encourage that kind of meddling. If, through repealing the Clark amendment, we can create some uncertainty in the Soviet Union about our intentions, or at least send a signal with respect to other situations in the future, then we have done a good day's work.

Thus, Mr. President, we must bear in mind that an action like repeal of the Clark amendment sends multiple signals, som~ of which will, admittedly, be badly received, at least in the short run. The main signal repeal sends, however is that t~e United States is emerging fro~ a periOd of weakness and confusion and into a period where our national interest is defined more clearly and defended more effectively. As I indicated, there are danger~ there as well, in seeking to replace SoVIet hegemony with our own in areas that will gain the most from the least involvement of the major powers. But on the whole, repeal of the Clark amendment signals a return to a more positive and constructive policy which is worthy of support.

M:. Presid.e~t, I spoke a few moments ago m opposition to the Tsongas amend~ent and the kind of signal that I believe that the maintenance of the Clark amendment in the law sends to the CUbans and others. I shall not repeat further that part of my remarks.

I do, however, want to make it very

clear on the record that our repeal of the Clark amendment as we have i:mown it should not be construed by anybody, either observers in Africa or people in Congress or people in the Reagan administration, as meaning that we want them to start sending aid, assistancemilitary or semimilitary, covert or direct-into some part of Angola.

I have no doubt that there are some people, either in the administration or maybe even in this body, who believe that it would be in our interest to aid, directly or indirectly, Jonas Savimbi. Jonas Savimbi is head of UNITA in Angola and probably comes as close as anybody I can think of to the definition of a true African freedom fighter. He is a man of immense talent; he is extremely articulate; he has great loyalty from the people in his part of Angola. But I believe that for us to start taking sides in Angola would be a grave mistake and would only postpone, perhaps indefinitely, the day which all responsible Angolans hope for, a reunification of the conflicts and tensions and principles. The people in leadership positions must get together and, once and for all, settle their country's future as a means of insuring its future prosperity and bringing about, once and for all, political stability which will not permit, because it will not want, the kind of involvement that we see there now on the part of the Cubans.

I understand that it is the policy of the Reagan administration that there should be an internal settlement among the various forces contending for power in Angola and that UNITA's Savimbi should be part of it. That would be my wish, too.

This is not a policy, as just described, that is significantly different from that of the last administration. I hope that people who might get a little carried away with enthusiasm over the repeal of the Clark amendment would understand that when Jonas Savimbi was in this country a year ago last December and met, I assume, with others beside myself, he made as clear to them as he did to me that, in fact, he did not feel that it would be either appropriate or necessary or welcome for the United States to give him assistance of the kind-military, covert, or overt-that some people, on occasion, advocate. I believe that that kind of assistance to UNITA would almost certainly encourage the other group in Angola, the MPLA, led by Mr. dos Santos, to increase its reliance on Cuba, and, of ~ourse, that is the very result that we want to avoid.

We want the Cubans out, not in. We certainly do not want them any more in than they have been. We trust they will be on their way out just as soon as possible and, for my money, as soon as possible would be tomorrow.

One last observation, Mr. President. That is the question that has been raised of what repeal of the Clark amendment sends in the way of a signal to black Africa. It is this Senator's view that as long as the United States is firm in its resolve to make progress on the question of Namibia, the repeal of the Clark amendment will be to the overwhelming majority of observers in Afric~not just

southern Africa but throughout the continent--very much a secondary issue. There may be comments of an unfavorable nature, but, frankly, to the extent that there are, I should not take them terribly seriously over the longer term. I think we would be judged by our actions not by their words. It seems to me that if we make it clear, as I think the debate has here today, that we cannot any longer tolerate the signal that the Clark amendment sends to our allies, to the Eastern bloc, to the Southeast Asians, to the Cubans, that they have carte blanche in Angola and we have to keep our hands off, that the sooner we erase that message from the pages Of the CONGRESSIONAL RECORD, the better off we all will be.

We have seen what happens when we define Angola outside vur national interests. We have seen how the Cubans, thanks to the Soviets, have stayed. It is time we sent a positive, clear, well-defined message to our friends, allies, and those hostile to our interests that this is an area of our interest. It is not one in which we seek to impose our will, but it is not one in which we will stand by idly or uncertainly while other people outside that country or that area seek to impose their will.

Mr. President, I hope my colleagues will join in accepting the Kassebaum amendment.

Mrs. KASSEBAUM. Mr. President, I thank the senior Senator from Pennsylvania for his support and his observations.

We have had debate on this matter previously, and Senator TSONGAS and I have talked and agreed that it would not be necessary to have a rollcall vote. I now move the adoption of the amendment.

Mr. PERCY. Mr. President, will the Senator withhold that?

Mrs. KASSEBAUM. I yield. Mr. PERCY. I thank my distinguished

colleague. Before we vote I just want to offer a few additional comments on the matter before us.

Mr. President, understandably the administration wants to regain ~ll its options in Angola. It wants to have the power of ambiguity-which I think is a useful foreign policy tool. However the administration has encountered' the problem that many people believe the U.S. Government is not ambiguous-that it has already decided to provide aid to Jonas Savimbi's UNITA guerrilla forces.

Time and again, the administration has had to protest to our African and European friends that it has made no decision on whether to provide aid to UNITA's soldiers, or to any other group.

It is important for Congress to make the same distinction. It is important to say that in repealing the prohibitions of the Clark amendment, Congress is not approving covert military aid to Savimbi.

I have been assured every time I have sought a response that there is no plan to aid Savimbi. I know that our Assistant Secretary for African Affairs, Mr. Crocker, would be fully involved in any decision, and he has said there is no such plan. But I have long held and felt that we should have the freedom of movement that any other government on Earth has.


I am gratified that Senator KASSEBAUM's proposal retains what I consider to be a significant statement contained in the amendment approved by the Foreign Relations Committee: that "Nothing in this section shall be construed to be an endorsement by Congress of the provision of assistance * * * to conduct military or paramilitary operations in Angola."

Unless we make clear what repeal does not imply, there will be dangerous misinterpretations.

I believe it is also important to assure that if the President does decide to take action in Angola, Congress will know about it.

The law which Congress approved last year gives to the Intelligence Committees the responsibility for receiving information from the executive branch regarding covert operations. However, the law and the legislative history clearly provide that the Intelligence Committee should inform the Foreign Relations Committee of any activities having important foreign policy implications.

In a letter Senators GoLDWATER and Bayh wrote last year on behalf of the Intelligence Committee to Senators Church and Javits, the following assurance was provided:

If the Hughes-Ryan Amendment is amended or repealed and only the intelligence oversight committees are to be provided with information on special activities, tlhe Select Committee on Intelligence would of course promptly call to the attention of the Foreign Relations Committee any special activity which would have important foreign policy implications. This is an affirmative duty under sen. Resolution 400, Sec. 4(a).

This assurance was one in a series provided in response to inquiries from the Foreign Relations Committee at the time the Intelligence bill was being debated. I ask unanimous consent that a letter from Senators Church and Javits dated March 4, 1980, and the reply from Senators Bayh and GoLDWATER dated March 24, 1980, be printed in the RECORD at this point.

There being no objection, the letters were ordered to be printed in the REcoRD, as follows:

U.S. SENATE, COMMITTEE ON FOREIGN RELATIONS,

Washington, D.C., March 4, 1980. Hon. BIRCH BAYH, Chairman, Hon. BARRY GOLDWATER, Ranking Minority Member, Select Committee

on Intelligence, Washington, D .C. DEAR SENATORS : We were gratified to note

that on February 8, and on behalf of the Select Committee on Intelligence, senators Huddleston and Mathias introduced S. 2284, the National Intelligence Act of 1980. On behalf of the Foreign Relations Committee, we would like to extend our congratulations to you, and your Committee, on this accomplishment. We are aware of the work that went into this legislation and it is indeed an important contribution.

We understand that hearings on s. 2284 began on February 21 and that these hearings should continue for several weeks. During this time, the Foreign Relations Committee intends to review S. 2284 to determine whether, pursuant to Senate Resolution 400, the Committee should request referral of the reported legislation. To assist the Committee in this determination, it would be most helpful 1! the Select Committee would re-

spond to the following questions of immediate interest to the Foreign Relations Committee:

1. Access to the Intelligence ProductSenate Resolution 400 contains a provision (section 3(d)) which states:

Nothing in this resolution shall be construed as amending, limiting, or otherwise changing the authority of any standing committee of the Senate to obtain full and prompt access to the product of the intelligence activities of any department or agency of the government relevant to a matter otherwise in the jurisdiction of such committee.

As you can well imagine, the Foreign Relations Committee must continue to have prompt access to finished intelligence. In light of this requirement, the Committee would like to ascertain whether any provisions of S. 2284 restrict the ability of the Committee to obtain such information, either in published form or through briefings by Intelllgence Community officials.

2. Information on Covert Activities-Pursuant to the Hughes-Ryan Amendment to the Foreign Assistance Act of 1961 , the Foreign Relations Committee currently receives notifications on certain covert activities. Section 902, Title IX of S. 2284 would repeal the Hughes-Ryan Amendment , restricting notification to the Senate and House Intelligence Committees. At the same time, Section 143 of Title I places an affirmative obligation on the two Intelligence Committees to "promptly call to the attention of . . . any appropriate committees .. . any matter relating to intelligence activities which requires or should have the attention ... of such committees ... . " Section 143 parallels Section 4(a) of senate Resolution 400 in this regard.

Although we are sympathetic to restricting notification of covert activities to the two Intelligence Committees, we believe that it will be essential for the Foreign Relations Committee to continue to receive information on those covert activities which have important foreign policy implications. Thus, we would appreciate your views on this subject and, specifically, what procedures you would envision to keep the Foreign Relations Committee informed of such activities, including the timing of such notification, pursuant to Section 143 of Title I.

3. Definition of "Special Activity"-The definition of "special activity" as found in Section 103 of Title I excludes counterintelligence or counterterrorism activities or "the collection ... of intelligence or related support functions ... " Thus, it would appear from this language, and the language of Sections 123 and 125 of Title I , that "special activities" refers exclusively to that activity historically known as covert action and that Congressional notification would be limited to it. Yet, as you know, certain sensitive intelligence collection activities, as well as counterintelligence and counterterrorism activities, may have significant foreign policy implications. Thus, the Committee would like to ascertain the rationale for the Select Committee's rather strict definition of "special activity" and your views on how the Select Committee intends to oversee sensitive collection, counterintelligence and counterterrorism activities and how the Foreign Relations Committee would be kept informed of those activities which have significant foreign policy implications.

4. Responsibilities of U.S. AmbassadorsThe section-by-section analysis of section 111, Title I of S . 2284 states :

Except as expressly provided, nothing in this act affects or alters existing responsibilities under law, including responsibilities to the Ambassador of a particular country under 22 USC 2680a.

The Foreign Relations Committee, obviously, feels quite strongly about the responsi-

bilities of our Ambassadors abroad. In this regard, it would be most helpful if you could provide the Committee an analysis , and rationale, of those provisions of S. 2284 which affect the responsibility of our Ambassadors.

5. Authorization for Special ActivitiesSection 123, Title I Of S. 2284 would establish two categories Of speci-al activities which requiro Presidential findings. The first category is for those activities which involve "substantial resources, risks, or consequences." For each of these, the President would be required to submit a finding. The second category is for "any other special activities" and would require a finding by the President that this category of special activities is important to the national security of the United States.

As written, section 123 departs from the Hughes-Ryan Amendment by establishing two categories of Presidential findings. We are concerned that the establishment of these two categories may lessen Presidential accountability for the approval of covert activities and conceivably Oongressional oversight of them. Thus, we would appreciate being informed of your rationale for the establishment of the two categories and a definition of what types of activities would be included in the second category. It may be necessary to provide this information to the COmmittee on a classified basis.

We believe that answers to t he questions and issues we have outlined above would be of great assistance to the Foreign Relations Committee in deciding whether to request referral of any reported legislation. We know that you are quite anxious to see this legislation, or some version of it, acted on expeditiously. We believe that receipt of the information requested in this letter would allow us to move promptly in our consideration of what action to take.

Sincerely, FRANK CHURCH,

Chairman. JACOB K. JAVITS,

Ranking Minority Member.

U.S. SENATE, SELECT COMMITTEE ON INTELLIGENCE,

Washington, D.C., March 24, 1980. Hon. FRANK CHURCH, Chairman, Hon. JACOB K. JAviTs, Ranking Minority Member, Committee on

Foreign Relations, U.S . Senate, Washington, D .C.

DEAR FRANK AND JACK: We very much appreciate the letter you sent on March 4 concerning the introduction of S. 2284, the National Intelligence Aot of 1980. The COmmittee fully understands that a comprehensive charter for the inte<Uigence activities Of the United States is a question of importance to the Foreign Relations Committee that requires answe·rs. In the drafting of S. 2284 we have tried to keep the Foreign Relations Commtttee's responslbUltles in mind.

Your letter contained five specific questions and we would like to answer them in this letter.

( 1) Access to the Intelligence ProductThere are no provisions in s. 2284 that would prevent or restrict the Senate COmmittee on Foreign Relations from obtaining prompt access to finished intelllgance in the jurisdiction of the Senate Foreign Relations Committee. This is consistent with Section 3(d) of Senate Resolution 400, which states:

Nothing in this resolution shall be construed as amending, limiting, or otherwise changing the authority of any standing committee of the senate to obtain :full and prompt acce5.s to the product o:f the intelligence activities of any department or agency of the Government relevant to a matter otherwise within the jurisdiction of such committee.

Further, under Senate Resolution 400 the Select Committee on Intelligence is obliged,

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22535 as the Committee would be under S. 2284, to assist and to make available to the Foreign Relations Committee such information.

Sec. 4. (a) The select committee, for the purposes of accountability to the Senate, shall make regular and periodic reports to the Senate on the nature and extent of the intelligence activities of the various departments and agencies of the United States. Such committee shall promptly call to the attention of the Senate or to any other appropriate committee or committees of the Senate any matters requiring the attention of the Senate or such other committee or committees. In making such reports, the select committee shall proceed in a manner consistent with section 8(c) (2) to protect national security.

In accordance with this responsibility, we have endeavored over the past three years to provide to the Foreign Relations Committee information that has come to the Select Committee's attention which we believed would be of value to the Foreign Relations Committee. We have also completed a number of reports of assistance to the Foreign Relations Committee in carrying out its duties. Examples of these reports are the report to the Foreign Relations Committee and to the Senate on Certain Intelligence Aspects of the Panama Canal Treaty, the Arms Balance in the Middle East, and the Capabilities of the Intelligence Agencies of the United States to Monitor Compliance with the SALT II Treaty. We also have developed procedures to keep the Foreign Relations Committee informed of intelllgence that might indicate possible violations of the SALT Treaty.

(2) Information on Special Actlvitles-1! the Hughes-Ryan Amendment ls amended or repealed and only the intelllgence oversight committees are to be provided with information on special activities, the Select Committee on Intelllgence would of course promptly call to the attention of the Foreign Relations Committee any special activity which would have important foreign policy implications. This is an affirmative duty under Senate Resolution 400, Sec. 4(a). It would continue to be so under Section 143 of S. 2284. Further, Senate Resolution 400, Sec. 2(a) (1) (c) requires two members of the Senate Foreign Relations Committee to be members of the Select Committee on Intelllgence. The purpose of this obligation on membership is to assure that a substantive committee such as Foreign Relations. would have direct representation so that the interests of the Foreign Relations Committee would be certain to receive the attention that is warranted. As you know, S. 2284 would require prior notice on all significant anticipated intelligence activities, including special activities. If there were important foreign policy implications of a pa.rticula.r special activity, the Committee would act to inform the Foreign Relations Committee as soon as possible after its own notification.

(3) Definition of "Special Activity"-The definition of special activity contained in S. 2284 is confined to covert action. However, sensitive intelligence collection activities, as well as sensitive counterinte111gence and counterterrorism intelligence activities, are encompassed by the requirement for prior notice of significant anticipated intelligence activities. I·t is the view of the Committee that any intelligence activity which has significant foreign policy implications would be a matter, under the duties of Senate Resolution 400, Sec. 4(a), about which the Senate Foreign Relations Committee would be informed by the Select Committee on Intelligence in the same manner as special activities.

(4) Responsibilities of U.S. AmbassadorsThe speciflc intent of Section 111, Title I of S. 2284 referred to 1n your questions is

to underline the existing responsibmties under law of the U.S. ambassador under 22 USC 2680(a), none of which would be altered by S. 2284.

( 5) Authorization for Special ActivitiesSection 123, Tiltle I of S. 2284, which establishes two categories of special activities which require Presidential findings, namely those activities which involve substantial resources, risks, or consequences, and those that do not. The second type would require a finding by the President that a category of special activities is important to the national security of the United States. This reflects the present practice. We believe the present practice is a sensible one. Categorical approvals for certain kinds of activities are justified because of the relatively low risk and repetitive nature of such activities in contrast to those high risk activities which require personal accountability of the President for each specific activity. Our belief, based on experience, is that categorical findings can be monitored through the Committee's oversight procedures-provided the Committee obtains full access to information-and through the Committee's annual authorization process. The Committee will, of course, keep the Foreign Relations Committee informed, pursuant to Sec. 4(a) of Senate Resolution 400, of all special activities which have important foreign policy implications, whether in the first or the second category.

In closing, we deeply appreciate your interest in a comprehensive legislative intelligence charter and we would value your judgment on it before our Committee proceeds to mark-up.

Sincerely, BARRY GOLDWATER ,

Chairman. BmcH BAYH,

Vice Chairman.

Mr. PERCY. Mr. President, U.S. activities in Angola certainly fall in the category of having "important foreign policy implications." I intend to send a letter to this effect-and I cordially invite Senator PELL to join me, just as Senators Church and Javits joined in a letterto the leadership of the Intelligence Committee, to make absolutely certain that the chairman and the ranking minority member are advised of any planned activities.

I have also talked to the administration and have been assured that we would be advised should any such activities be contemplated. So we not only are going through our own Intelligence Committee in accordance with the law, but also have gone directly .to the administration and have received their assurance that this sensitivity would be taken fully into account and our request adhered to.

At this time, as a matter of principle, we are removing a barrier which exists against our Government, which no other government has imposed on it, and which, in retrospect, has proved to be a policy approach that many believe was a mistake.

Mr. PELL. Mr. President, I will be glad to send such a letter, but with the understanding that it does not cover just Angola, that it covers the world.

Mr. PERCY. In this particular case, because of the particular sensitivity, the assurances I have received have related directly to Angola. I did not ask for any other assurances. But I believe the provisions of law are quite clear in this regard. I will be pleased to work with

my distinguished colleague on this matter.

Mr. PELL. I thank the Senator. Mr. PERCY. Mr. President, in view of

the statement in Senator KASSEBAUM's proposal that by repealing the Clark amendment Congress is not approving covert activities in Angola, and with steps we will take to stay informed of any possible future plans in Angola I believe Senator KASSEBAUM's amendm~nt is an appropriate response to the administration's request.

Finally, I would like to say that we always try to work out, in a bipartisan way, questions on major issues. Certainly, my respect for Senator TsoNGAs my very high regard for the concern h~ has expressed on this issue, his regret and my regret that we could not work out a satisfactory arrangement in this regard, should be understood by all of us. I feel that the Senator has spoken with conviction, loudly and clearly. With 66 Members of the Senate voting to table the Tsongas amendment, there appears to be support on both sides of the aisle for moving in a certain direction.

Therefore, I strongly recommend to the Senate that we now approve the Kassebaum amendment.

Again, I express my deep appreciation to the distinguished chairman of our African Affairs Subcommittee for her work in this area, which I believe is in the national security interests of the United States of America and in the best interests of peace in the world.

Mrs. KASSEBAUM. I thank the chairman.

Mr. SIMPSON. Mr. President, I rise in support of the amendment offered by my distinguished colleague from Kansas to repeal the so-called Clark amendment restricting U.S. aid to Angola. In doing so, I want to express my support and specific endorsement of the sentiment contained in subsection B of proposed section 709 of this bill. Subsection B states that the repeal of the Clark amendment should in no way be construed as a congressional endorsement of U.S. aid for military or paramilitary operations in Angola. My purpose in supporting Senator KAssEBAUM's amendment is certainly not to encourage covert U.S. involvement in Angola, but simply to remove what I regard to be an excessive and inappropriate legislative restriction on executive authority in the foreign policy area.

I would also note that my support of this amendment is based on the understanding that, despite the repeal of the Clark amendment, the executive branch must nevertheless, under the terms of last year's intelligence act, give timely notification to the Senate Intelligence Committee of any proposed U.S. aid for covert military operations in Angola or elsewhere, and that the Intelligence Committee will convey such notification to other appropriate committees, such as the Senate Foreign Relations Committee, for their information or action I commend this amendment to you.

Thank you, Mr. President. Mr. THURMOND. Mr. President, to

day I rise to support the amendment by Senator KASSEBAUM from Kansas,


which would repeal the Clark amendment on covert assistance to forces in Angola.

The Clark amendment prohibits any security assistance to Angola, or any groups therein. It is my firm belief that, largely because the United States failed in the midseventies to support forces that opposed the Marxist-oriented movement, Communist factions control much of that country today.

This is not a matter of entangling U.S. military troops or equipment in another Vietnam-type situation. It is my belief, however, that the President should not be restricted from allocating appropriate military hardware and economic assistance when he determines that it is in the best interest of the United States. The President should not be bound by legislation that prevents this country from extending a helping hand to those :fighting Communist aggression.

Mr. President, supported by the Soviets and their Cuban surrogates, the Communist cancer has been growing almost daily. There can be no misunderstanding as to Soviet intentions in Angola. Their interest in controlling this African country is to establish a zone of influence in southern Africa, and thereby to place themselves in a position to take advantage of developments and instability in that area of the world.

Furthermore, the Soviets hope to gain prestige among Third World countries by abetting the crusade against South Africa, a nation which, while it has its shortcomings, has been staunchly antiCommunist and friendly to us. Ultimately, by controlling Angola and other countries in Africa, the Soviets no doubt hope to impair the access of the United States to Zairean cobalt and other South African strategic minerals.

Let us make no mistake about it. Since enactment of the Clark amendment, the Soviet Union has established a strong strategic foundation in this area of Africa, while the United States could merely watch from the sidelines because of the unwise restrictions imposed on the President by Congress.

How long, Mr. President, will we allow the Soviets and Castro to move into and take control of these vulnerable Third World nations before we draw the line? How many countries will have the freedom they now possess violently stripped away by Soviet-inspired aggression, while our hands are bound by unwise restrictions such as the Clark amendment?

President Reagan has set a tone of dealing firmly with Soviet aggression wherever it may occur, and I believe the American people support this firm stand. We must continue to rebuild our own military strength as expeditiously as possible. At the same time, we must be prepared to cautiously and wisely render assistance to others in the world community who are fighting against Communist aggression. Repeal of the Clark amendment will untie the President's hands and allow him to deal effectively with the situation in Angola in a way that serves the best interest of

the United States and of those who are struggling there to regain their freedom.

The PRESIDING OFFICER. Is there further debate on the amendment?

The question is on agreeing to the amendment of the Senator from Kansas.


Mr. PERCY. I move to reconsider the vote by which the amendment was agreed to.

Mrs. KASSEBAUM. I move to lay that motion on the table.



(Purpose: To delete provisions concerning the Overseas Private Investment Corporation which the Senate has already passed in a separate bill)

Mr. PELL. Mr. President, I send an amendment to the desk and ask for its immediate consideration.


The bill clerk read as follows: The Senator from Rhode Island (Mr. PELL)

proposes an unprinted amendment numbered 448.

Mr. PELL. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.


The amendment is as follows: Beginning with page 39, line 16, strike out

everything through page 45, line 6, and renumber titles and sections accordingly.

Mr. PELL. Mr. President, the amendment that I sent to the desk deletes title V. The Senate has already acted separately on legislation to amend and extend OPIC, the Overseas Private Investment Corporation. I am hopeful in fact that the legislation will be on its way to the White House tonight.

Accordingly, title V of this bill is unnecessary.

Mr. President, I ask that the Chair put the question.

Mr. DOLE. Mr. President, I am a poor substitute for Senator PERCY, but I understand this has been cleared on both sides and it is not controversial.

Mr. PELL. That is correct. It has been cleared on both sides and, I believe, with Senator BAKER as well.

The PRESIDING OFFICER. The question is on agreeing to the amendment of the Senator from Rhode Island.



(Purpose: To require a comprehensive analysis of foreign assistance)

Mr. PELL. Mr. President, in behalf of Senator PRESSLER, I send to the desk an unprinted amendment and ask for its immediate consideration.



The Senator from Rhode Island (Mr. PELL), on behalf of Mr. PREssLER, proposes an unprinted amendment numbered 449.

Mr. PELL. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.


Insert the following new section at an appropriate place in the bill:

It is the sense of Congress that at a time when major retrenchments and reappraisals are being made in domestic programs, it is also logical that, while maintaining past international commitments, the magnitude and direction of future foreign assistance programs should also be reviewed. As part of such a review process, the President is requested to provide no later than February 15, 1982, a comprehensive report to the Congress on his approach to foreign assistance. Such report shall include an analysis and recommendations on the following issues:

(a) The relationship between foreign assistance and defense expenditures as means of conducting foreign policy.

(b) The appropriate mix between military and economic assistance.

(c) The strengths and weaknesses, and appropriate mix, of bilateral and multilateral assistance programs. -

(d) The relevance of the basic human needs approach to current aid policy.

(e) The performance of other aid donors, and the benefits they derive from their programs.

(f) Criteria for determining the appropriate size and composition of country programs.

(g) The appropriateness of the current mix of grants and loans, and the possibillty of combining them with new or existing guarantee, insurance, and export credit programs.

(h) Specific means to more actively engage the private sector in assistance programs.

(i) The usefulness of current functional categories in constructing the development assistance budget.

Mr. PELL. Mr. President, this is a good amendment. Both the executive and legislative branches of Government tend to deal with one issue crisis at a time. We seldom take an overall look at the whole picture, and that is exactly what this amendment seeks to do.

It is timely that we do so because we are still working with foreign assistance legislation that was last thoroughly overhauled in 1971.

In the past couple of years we have actually run our aid on a continuing resolution, a fate I hope we do not again follow this year.

At a time when we are taking a hard look at so many of our domestic Government programs, it is appropriate that we take a similar look at the foreign assistance programs. If they are to receive the support of the public and Congress, it is crucial that there be a clear rationale for them.

I thank the Senator from South Dakota for offering the amendment today and for his general constructive work on the committee.

I note that this amendment has been cleared on both sides of the aisle.

Mr. PRESSLER. Mr. President, this amendment has been discussed with the comanagers of the bill, and I appreciate their willingness to accept my amendment.

First, I would like to commend our distinguished colleagues, Senator PERCY and Senator PELL, for their outstanding leadership in the Foreign Relations Committee and for their skillful floor management of this bill. As chairman of the Foreign Relations Committee, Senator PERCY has been instrumental in fashion-


ing one of the most responsible security and development assistance authorizations in many years.

In particular, this fiscal year 1982 authorization is 14 percent below the President's budget request. I hope that the $900 million reduction by the committee will be recognized as a substantial contribution to the Nation's economic recovery effort. More could be cut, in mY opinion, without violating our international commitments. However, my point is that under the leadership of Senator PERCY and Senator PELL, we are moving responsibly toward more austerity in Federal spending on international security and development assistance programs.

In view of the change in direction of Federal domestic spending and taxation which has been the focus of our attention this year, I am proposing this amendment to require the compilation of a major analysis of the current effectiveness of the principal elements of U.S. foreign assistance.

A sweeping review of the role played by foreign assistance in our foreign policy and national security is needed to insure that our foreign aid dollars are being spent wisely. The effects, both actual effects and intended effects, of foreign aid would also be thoroughly examined under this amendment. The report would be submitted to the Congress prior to the next annual authorization.

The administration has indicated that it is in the process of reevaluating many aspects of U.S. foreign policy. For example, recently President Reagan and Secretary Haig spoke about the need for a greater reliance on private assistance efforts and international trade to accomplish foreign economic development goals.

It seems to me that Congress would be encouraging and reinforcing these and other changes in the direction of our foreign aid programs if it were to adopt my amendment.

There is much criticism of foreign aid throughout American society. The analysis required by my amendment would help to answer many of the questions which people raise about the effectiveness of aid programs in accomplishing foreign policy and national security objectives.

We are now rethinking our domestic programs. We must do the same for international programs, not only in terms of budgetary costs but also in terms of actual consequences.

Specifically, tthe comprehensive analysis of foreign assistance as required by the amendment would include detailed information on the relative merits of bilateral and multilateral aid programs. Such information is essential in providing Congress with a rational foundation for determining the best shape for future aid programs. Congress should have this overall, integrated view of what needs to be done in future foreign assistance before it authorizes fiscal year 1983 foreign assistance spending. That authorization will be the first one that the Reagan administration could call its own.

The fiscal year 1981 and fiscal year 198·2 international budgets bear heavily the policy preferences of the previous

administration. Thus, I am confident that the review and analysis required by this amendment will be very useful in helping the administration to develop a coherent and fiscally sound new approach to foreign assistance in future years. Congress, too, would be able to use this study to improve Lts foreign aid decisionmaking in a manner that is more responsive to the public's perceptions of and preferences concerning the U.S. role in world affairs.

In conclusion, Mr. President, this amendment would require the administration to clearly spell out the rationale for future aid programs, before congressional action on the fiscal year 1983 budget. It also specifies nine principal issue areas for investigation.

With these thoughts in mind, let me say that I am grateful to the distinguished managers of the bill for accepting this amendment.

The PRESIDING OFFICER. The question is on agreeing to the amendment of the Senator from Rhode Island.


Mr. PELL. Mr. President, I suggest the absence of a quorum.

The PRESIDING OFFICER. The clerk will call 'the roll.


Mr. DODD. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.



(Purpose: To limit the period for repayment of the principal amount of certain guaranteed loans) Mr. DODD. Mr. President, on behalf

of the Senator from Hawaii <Mr. INOUYE), I send an amendment to the desk and ask for its immediate consideration.

The PRESIDING OFFICER. The clerk will state the amendment.

The bill clerk read as follows: The Senator from Connecticut (Mr. DODD)

on behalf of the Senator from Hawall (Mr. INOUYE) proposes an unprinted amendment numbered 450:

On page 7, line 25, strike out "less" and insert in lieu thereof "more".

Mr. DODD. Mr. President, very briefly I am offering this amendment on behalf of the Senator from Hawaii <Mr. INOUYE). Under the committee bill, it provides that several countries could repay their FMS loans on an extended repayment basis of "not less than 20 years." Senator INOUYE's amendment changes this language to read "not more than 20 years."

This 20-year period would be preceded by a 10-year grace period and in either event the payments would probably be paid in a total of 30 years.

I understand that this is an amendment which has been agreed upon. I am glad to yield to my colleague from Indiana, Senator LUGAR.

Mr. LUGAR. Mr. President, I would like to raise, for the sake of the record, with my colleague from Connecticut these points with regard to the Inouye amendment.

Is it the intent of the amendment, as

the Senator understands it, to create a ceiling rather than a :floor for extended FMS repayment terms?

Mr. DODD. The Senator is correct. It is designed to create a ceiling.

Mr. LUGAR. Is it the intent of the sponsor of this amendment that FMS loans to the countries involved be repaid as recommended by the administration with a 10-year grace period on repayment of the principal and a 20-year repayment period thereafter?

Mr. DODD. The Senator is also correct on that point.

Mr. LUGAR. Is it the understanding of the Senator from Connecticut that this amendment does not change the intent of the Forei·gn Relations Committee's philosophy on this principle?

Mr. DODD. The Senator is also correct on that point.

Mr. LUGAR. The committee majority manager, on behalf of the distinguished chairman of our committee, is delighted to accept this amendment and recommends its passage.

Mr. DODD. I thank the Senator from Indiana.

Mr. President, I do not know of anyone else who cares to speak on this particullar amendment.

The PRESIDING OFFICER. The question is on agreeing to the amendment offered b-y the Senator from Connecticut <Mr. DoDD) on behalf of the Senator from Hawaii <Mr. INOUYE).


Mr. DODD. Mr. President, I move to reconsider the vote by which the amendment was agreed to.

Mr. LUGAR. I move to lay that motion on the table.


Mr. PERCY. Mr. President, I suggest the absence of a quorum.


The bill clerk proceeded to call the roll. UP AMENDMENT NO. 451

(Purpose: To exclude from charges for administrative services the recovery of extraordinary expenses incurred by departments and agencies of the United States in carrying out certain functions under the Arms Export Control Act)

Mr. KASTEN. Mr. President, I send an amendment to the desk and ask for its immediate consideration.



The Senator from Wisconsin (Mr. KASTEN) proposes an unprinted amendment numbered 451.

Mr. KASTEN. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.


The amendment is as follows: On page 9, strike out lines 14 through 18. On page 9, line 20, strike out "Sec. 109."

and insert in lieu thereof "Sec. 108.". On page 13, line 2, strike out "Sec. 110."

and insert in lieu thereof "Sec. 109.". On page 13, llne 3, strike out "109" and

insert in lieu thereof "108.". On page 18, llne 19, strike out "Sec. 111."

and insert in lieu thereof "Sec. 110.".

- -


on page 19, line 6, strike out "~. 112." and insert in lieu thereof "Sec. 111.".

On page 19, line 12, strike out "Sec. 113." and insert in lieu thereof "Sec. 112.".

On page 21. line 11, strike out "Sec. 114." and insert in lieu thereof "Sec. 113.".


Mr. KASTEN. Mr. President, this amendment deals with a very small item, but nonetheless it is an important principle.

The bill before the Senate contains a provision which would allow the Department of Defense to use funds derived from charges for administrative expenses from the FMS sales for entertainment expenses. While the committee bill sets no ceiling on these funds, administration officials have testified that total entertainment funds would be about $150,000, with approximately one-half of this amount coming through this backdoor method of funding.

Mr. President, as I said earlier, this is a small item, but I do feel quite strongly that we should not be approving any new back-door spending-however small. I hope the managers will accept this amendment and if they feel the funds for this purpose are necessary, I certainly do not object to a provision authorizing the appropriation of such funds.

We have discussed this at length with committee staff. It is my understanding that this amendment, or the general thrust of it, is agreeable.

Mr. PELL. Mr. President, I understand this amendment would have no budgetary impact whatever. In the past, military advisers overseas have, in effect, a diplomatic function, and they are often called upon to entertain overseas guests on official business. This type of entertainment expense should not be borne by these particular officers.

Mr. President, the total amount of money involved here is less than $150,000.

Therefore, the committee adopted section 108.

I might also mention that the chairman of the Foreign Operations Subcommittee is not opposed to the amount requested and has agreed to provide that amount requested by the administration from MAP appropriations.

If this is t.he case, we likewise have no objection to this amendment particularly because, as I said earlier, it has no budgetary impact whatsoever.

On this side of the aisle, I recommend we accept the amendment.

Mr. KASTEN. Mr. President, I move adoption of the amendment.

The PRESIDING OFFICER. The question is on agreeing to the amendment.


Mr. KASTEN. Mr. President, I move to reconsider the vote by which the amendment was agreed to.

Mr. PELL. I move to lay that motion on the table.


AMENDMENT NO. 516

(Purpose: To condition the availab111ty of funds for the Sahel development program

on the maintenance of certain accounting procedures with respect to such funds)

Mr. KASTEN. Mr. President, I call up my amendment No. 516 and ask for its immediate consideration.



The Senator from Wisconsin (Mr. KASTEN)

proposes an amendment numbered 516.

Mr. KASTEN. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.


The amendment is as follows: On page 32, line 20, insert "(a)" after "SEC.

309.". On page 33, between lines 2 and 3 , insert

the following: "(b) Section 12'1 of such Act is amended

by adding at the end ·thereof the following new subsection:

"·(d) Funds available to carn-y out this section (including foreign currencies acquired with funds a.ppropriated to carry out this section) may not be made available to any foreign government for disbursement unless the Administrator of the Agency for International Development determines that the foreign government will maintain a system of accounts with respect to those funds which will provide adequate identiflcation of and control over the receipt and eXlpenditure of those funds.'".

Mr. KASTEN. Mr. President. in May of this year the Foreign Operations Appropriations Subcommittee, which I chair, held its regular budget hearings on the administration's fiscal year 1982 request for the Sahel development program. Much of that hearing was spent discussing an audit report by the Agency for International Development's Inspector General, which had found serious deficiencies in the accounting systems of the countries which receive assistance under the Sahel development program. The deficiencies were such that in many of the cases looked at by the AID auditors it could not be determined what had happened to large sums o.f money-the report said:

Consequently, if the 13 projects included in our review are representative, and we believe they are, then miUions of dollars in local currencies are possibly being misused.

Mr. President, the two aspects of this matter which struck me in particular are: First, the revelation that the AID knew of these deficiencies for some time and did not take any action until forced to by the audit report; and second, even after the audit report was issued, it was clear to me that most of those AID officials who had some responsibility over this program, at least those who appeared before my subcommittee, were 'barely interested in correcting this situation and seemed unconcerned by the possible loss of such large amounts of funds.

Frankly, Mr. President, I had considered at the time calling for the complete cessation of this program until the matter was cleared up. Instead, as one step, I am suggesting we follow the recommendation of the House and condition the funding for the Sahel development

program on the maintenance of an acceptable accounting system in those countries which receive assistance under this program.

Mr. President, once more, we have discussed this particular problem with the Foreign Relations Committee. I believe that both sides are aware of the problems we have had in the Sahel development program and the lack o.f the kinds of accounting principles and programs that we need.

I believe this is an amendment that ought to have strong bipartisan support.

Mr. PELL. Mr. President, the program of the Sahel is helping some of the most impoverished, poorest people living in conditions of desperation. Not surprisingly, the governments of those countries lack sophistication, lack the special resources, when it comes to mainteining modern accounting practices.

Nonetheless, the American taxpayers have the right to insist that their assistance funds are well managed. I believe that this amendment will be of help so that, in the future, accounting systems are improved.

I urge acceptance of this amendment, which has been cleared on this side of the aisle.


Mr. KASTEN. I move adoption of the amendment.

The PRESIDING OFFICER. If there is no further debate, the question is on agreeing to the amendment.

The amendment <No. 516) was agreed to.

Mr. KASTEN. Mr. President, I move to reconsider the vote by which the amendment was agreed to.




(Purpose : To provide that funds -appropriated under the Foreign Assistance Act of 1961 or the Arms Export Control Act may be deobligated pursuant to an Act of Congress only to the extent or in the amounts

, provided in appropriation Acts)

Mr. KASTEN. Mr. President, I send an amendment to the desk and ask for its immediate consideration.



The Senator from Wisconsin (Mr. KASTEN) proposes an unprinted amendment numbered 452.

Mr. KASTEN. I ask unanimous consent that further reading be dispensed with.


The amendment is as .follows: On page 84, between lines 2 and 3, insert

the following: PROCEDURES FOR THE DEOBLIGATION OF FUNDS

SEc. 716. Funds appropriated to carry out any provision of the Foreign Assistance Act o! 1961 or the Arms Export Control Act and obligated to carry out such provision may be de-obligated, during the period for which such funds arc obligated, by an Act of Congress only to the extent or In the amounts

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22539 provided in an appropriation Act enacted on or after the date of enactment of this Act.

On page 84, line 4, strike out "Sec. 716." and insert in lieu thereof "Sec. 717."

Mr. KASTEN. Mr. President, the purpose of this amendment is to establish procedures for congressionally initiated deobligations of funds. The amendment simply requires that congressionally initiated deobligations must be provided for in an appropriation act.

Mr. President, I believe the principle involved here is quite simple; since only an appropriation act can make funds available for obligation, action by Congress to deobligate those funds should likewise be contained in an appropriation act.

I want quickly to add, Mr. President, a.nd underscore that this amendment has been drawn so as to apply only to congressionally initiated deobligations.

It is not intended to affect in any way the ability of program managers, consistent with other laws, to deobligate funds.

Mr. President, once more, we have discussed this amendment with the leadership of the committee and it is my understanding that it is acceptable to both sides.

Mr. PELL. Mr. President, the Appropriations Committee is concerned that it be involved in the deobligation of funds as well as the obligation of funds. This appears to be a reasonable reqest.

The committee can accept this amendment, Mr. President. We are ready for its adoption.

Mr. KASTEN. I move adoption of the amendment.

The PRESIDING OFFICER. The question is on agreeing to the amendment. · The amendment <UP No. 452) was

agreed. to. Mr. KASTEN. Mr. President, I move

to reconsider the vote by which the amendment was agreed to.




(Purpose: To eliminate the limitation on the monthly rate of payment of a readjustment allowance for Peace Corps volunteers)

Mr. PELL. Mr. President, in behalf of the senior Senator from Hawaii, I send to the desk an unprinted amendment and ask for its immediate consideration.



The Senator from Rhode Island (Mr. PELL), for the Senator from Hawaii (Mr. INOUYE), proposes an unprinted amendment numbered 453:


READJUSTMENT ALLOWANCE SEc. 615. The first sentence of section 5(c)

of the Peace Corps Act is amended by striking out "at a rate not to exceed $125".

Mr: PELL. Mr. President, the purpose of this amendment is to remove the $125 limitation on the monthly rate of ·payment of readjustment allowances for Peace Corps volunteers.

The readjustment allowance is a lumpsum payment provided to volunteers to ease the cost of readjusting to life in the United States after serving 2 years abroad. Currently, the readjustment allowance is computed at the rate of $125 per month for each month of completed service. This $125 monthly rate was established by Congress in 1975 and would, if adjusted for inflation, be $200 per month in 1982.

Mr. President, I believe that the time has come to provide tangible evidence of our continued support for Peace Corps volunteers. We can do that by simply removing the limitation on the monthly rate. While it is not realistic, in these times of budgetary stringency, to fully compensate for the erosion of inflation, I would hope that a new monthly rate of $175 will be established by the Director of the Peace Corps.

I believe that a $50 monthly increase in the readjustment allowance is a modest amount and an appropriate way to recruit Peace Corps volunteers.

Mr. President, this amendment has been cleared on both sides of the aisle. I ask that it be adopted.


Mr. PERCY. Mr. President, the amendment being offered by Senator INOUYE deletes the $125 monthly ceiling on payments for Peace Corps volunteers.

It is my understanding that the current ceiling for monthly payments to Peace Corps volunteers was set in 1976. Inflation has not been taken into account since then. If inflation were taken into account, the ceiling would be over $200 per month.

Mr. President, it is difficult enough to attract talented people to serve in the Peace Corps. Holding down their already very low monthly payment will make it even more difficult to attract talented people to these worthwhile jobs.

This amendment will not increase the authorization in this bill. Any additional expenses would come out of existing funds.

Mr. President, I have never had this claim disputed. I probably have visited with more Peace Corps members, over a period of years, including my years in business while traveling abroad, than any other Member of Congress. They have been my eyes and ears in many countries. Four or five years ago, my brother-in-law, John Guy, was country director of the Peace Corps in Afghanistan and was living there with his wife and three children. I visited Afghanistan at that time, toured the country extensively. I visited with more than 200 Peace Corps members. Whether they are in Afghanistan or any other country in even more remote parts of the world, the Peace Corps has served the national interest of this country for many, many years. Certainly, just to take into account inflation, this is a justifiable expenditure and, for that reason, the managers of the bill can and will accept this amendment.

The PRESIDING OFFICER. Is there further debate on the amendment? If not, the question is on agreeing to the amendment.


Mr. PERCY. Mr. President, I move to reconsider the vote, and I move to lay that motion on the table.





Mr. PELL. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.


Mr. PELL. Mr. President, I ask unanimous consent that the senior Senator from Massachusetts <Mr. KENNEDY) be added as a cosponsor to my earlier amendment <UP No. 445) on human rights in Pakistan.


Mr. PELL. Mr. President, I suggest the absence of a quorum.



Mr. PROXMffiE. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

The PRESIDING OFFICER <Mr. MURKOWSKI) . Without objection, it is SO ordered.

AMENDMENT NO. 551

(Purpose: Expressing the sense of the Congress that the President should undertake a diplomatic initiative to obtain payment by the Soviet Union of its arrearages to the United Nations)

Mr. PROXMIRE. Mr. President, I call up my amendment No. 551 and ask for its immediate consideration.

The PRESIDING OFFICER. The clerk will report.

The legislative clerk read as follows: The Senator from Wisconsin (Mr. Paox

MIRE) proposes an amendment numbered 551.

Mr: PROXMIRE. Mr. President, I ask unammous consent that further reading of the amendment be dispensed with. I will describe the amendment.

The PRESIDING OFFICER. Without objection, it Is so ordered.

The amendment is as follows: On page 84, between lines 2 and 3, insert

the following: "FINANCIAL OBLIGATIONS OF THE SOVIET UNION

TO 'rHE UNITED NATIONS "SEc. 716. (a) The Congress finds and de

clares that-.. ( 1) the financing of the United Nations is

the collective responsibil1ty of all member nations;

"(2) the International Court of Justice has determined that the expenses of the United Nations incurred in its peacekeeping operations are properly included as a part of the regular expenses of the United Nations;

"(3) peacekeeping operations are vital to the mission of the United Nations and must be adequately financed if such operations are to continue; and

"(4) the Government of the Union of Soviet Socialist Republics is currently $180,000,-000 in arrears on its payments to the United Nations, primarily as a result of its ref~l

22540 CONGRESSIONAL. RECORD-SENATE ·September 30, 1981 to pay for the peacekeeping operations of the United Nations.

"(b) It is the sense of the Congress that the President, acting through the Permanent Representative of the United States to the United Nations, should undertake a diplomatic initiative to obtain payment by the Government of the Union of Soviet Socialist Republics of all its outstanding financial obligations to the United Nations, including its assessments with respect to the peacekeeping operations of the United Nations.".

On page 84, llne 4, strike out "SEc. 716. ' and insert in lieu thereof "SEc. 717.".

Mr. PROXMIRE. Mr. President, I ask unanimous consent that the Senator from Virginia (Mr. HARRY F. BYRD, JR.) and the Senator from West Virginia <Mr. RANDOLPH) be added as cosponsors to my amendment.


Mr. PROXMIRE. Mr. Pres·ident, this amendment is a sense-of-the-Senate resolution stating that the President, a~Cting through th•e permanent Representative of the United States to the United Nations, shouid undertake a diplomatic initiative to obtain payment by the Government of the U.S.S.R. of all its outsltanding financial Obligations to the United Nations.

The Soviet Union now sftands over $180 million in arrears to the United Nations-principally for peacekeeping activities. This large debt not only tells us something about 'the status of pea~Cekeeping in Soviet fioreign policy, burt it pos·es a direct threat to the finandal well-being of the United Nations.

The refusal of the Soviets to pay their peacekeeping assessments spans many years and events. They refused to pay $32 million for th'e 1956 emergency force ·in the Middle East. They refused to pay their $45.7 million share for the Congo peacekeeping operation.

They refused to pay their $18.5 million obligation f'Or the 19'73-74 emergency force for the Middle East. They owe $40.3 million for the interim force in Lebanon. And they owe $23.7 million for the bond issue which was initiated to finance the U.N. after they neglected to pay for the Congo operaJtion.

In addition to these peacekeeping debts, the Soviet Union owes $15.2 million to the technical assistance progTam. They deny this last debrt, having paid it in rubles. But since the ruble is a nontransferable currency in the U.N. the U.N. rightly accepts only a limited number of them and considers this obligation unfulfilled.

This last item aside, the central issue here is the financing of U.N. peacekeeping forces. The U.N. was established "to maintain international peace and security," and to this end it was provided that the U.N. would have the capacity to finance a peacekeeping force.

This has proved extremely useful in certain situations, including those already mentioned. Neutral armies to serve as buffer forces and to supervise ceasefire agreements are indispensable. The U.N. is the perfect sponsor for such forces. Peacekeeping units are undeniably one of the U.N.'s most effective weapons in the fight for peace. Without

the authority to commission peacekeeping units, a central function of the United Nations would be threatened.

As clear as the necessity for peacekeeping forces are the directives as to who should pay for them. It is stated very plainly in article 17 of the U.N. charter that "the expenses of the organization have been put to rest by a ruling of the International Court of Justice.

The Soviet Union, however, has done its best to undermine this system of payment. They claim that peacekeeping assessments are not part of the regular organization expenses, and thus article 17 does not hold. They proceed on the assumption that those who are supposedly responsible for a conflict must bear the expenses of a peacekeeping force. Thus, in the Congo, they say the "Belgian Colonizers" should foot the bill. In the Middle East they say Israel alone is responsible.

The bankruptcy of this position is obvious. The so-called aggressor exists only in the eyes of the beholder. If the Soviet's criterion on who should pay for peacekeeping were a general principle, we would never have any peacekeeping forces. One can easily imagine endless U.N. battles over the question of who is the aggressor.

What kind of a principle is this for an organization dedicated to international law and justice? It is a principle which is completely antagonistic to the basic U.N. tenet of collective responsibility. It is a principle which would destroy any possibility for the consensus which is crucial to peacekeeping operations. It is a principle which would ultimately put an end to such operations.

The Soviet dereliction of responsibility becomes even more apparent when we consider the fact that they have veto power in the Security Council. The Security Council must approve any peacekeeping operation. Thus the Soviets must at least tacitly approve any peacekeeping operation.

What happens is that the Soviet Union gives voice to the need for peacekeeping in the Security Council and then refuses to pay for any resulting operations. They have been getting away with this technique for years because the other nations of the U.N. simply have been worn down by Soviet rhetoric and propaganda. There has been no real campaign to force them to be a responsible member of the U.N. family by living up to their financial obligations. They are getting a free ride.

Soviet intransigence on this matter directly threatens the survival of the U.N. It undermines the most fundamental tenet of U.N. operations. By attempting to destroy collective responsibility for peacekeeping, the Soviet Union is making it even more difficult to employ this technique as an alternative to regional conflict. Without this capacity the U.N. would lose one of its few remaining substantive roles.

Already the United Nations can be accurately criticized for a lack of objective accomplishment. Without peacekeeping, its record may be bare.

The United States needs to take a stand against Soviet perfidy at the

United Nations. We have the issue; we have the facts; all we need is the will.

Mr. President, I ask unanimous consent that the junior Senator from Tennessee <Mr. SASSER) be added as a cosponsor of the resolution.


Mr. RANDOLPH addressed the Chair. The PRESIDING OFFICER. The Sen

ator from West Virginia. Mr. RANDOLPH. Mr. President, the

able Senator from Wisconsin <Mr. PROXMIRE) in offering this amendment not only provides others of us the opportunity to cosponsor his proposal but he brings to our attention as well as to the attention of the American people the failure of the Soviet Union to join with others as we attempt to obtain peace in the world through the initiatives of the United Nations.

This is not the first time in which the Soviet Union has disregarded its commitments. It is certainly a glaring example of the Soviet Union going back on a covenant, going back on an agreement, going back on an understanding, going back on a pledge which was made by the leadership of the Soviet Union when the United Nations was created.

I have spoken many times in this body and throughout the State of West Virginia of the failure of the Soviet Union to honor its commitments. I hope that the knowledgeable managers of the bill will accept an amendment of the type which is now pending. I believe that it is very important that we, at long last, not only serve notice but that we, by our action in this body, are willing to put the Russians on notice regarding equal commitments.

Mr. PROXMIRE. Will my good friend from West Virginia yield for just a minute so I may get the yeas and nays? Mr. President, I ask for the yeas and nays on this amendment.


The yeas and nays were ordered. Mr. PROXMIRE. I thank my good

friend from West Virginia. Mr. RANDOLPH. I thank the Senator

from Wisconsin. I cannot imagine that there would be Senators who would rise in this body and speak against the validity, the necessity, the urgency of the United States speaking out at this time in an attempt not to secure some funding which is newly requested of the Soviet Union, but only to have the Soviet Union as a responsible partner in the United Nations, with its power, as a member of the Security Council, to come to grips with this matter.

The American people deserve equity and justice in the international efforts of peacemaking. This is the time for the Russian hierarchy to be placed on notice. I hope that the Senator from lllinois will support the pending amendment.

Mr. PROXMIRE. Mr. President, I wish to thank my good friend from West Virginia for an extraordinarily eloquent statement. I thmk his last wish, as he expressed it, that we vote unanimously on this is exactly the reason why I asked

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22541 for the yeas and nays. I think we should have a unanimous agreement.

The United Nations has been attacked, it has been maligned, and it has been criticized. And it has made a lot of mistakes. It has been wrong on many things. But it is a peacekeeping organization. That is its function, to keep peace in the world. As I pointed out in my statement, it is uniquely qualified to do so.

But there is no way it can effectively keep peace unless it gets the cooperation of other nations, and particularly a superpower like the Soviet Union, which, as the Senator from West Virginia said so well, is on the Security Council and has a veto power on any of these veto actions. Certainly if any nation is going to cooperate in the United Nations, we should expect full cooperation in these peacekeeping matters by the Soviet Union.

The Soviet Union tries to make all kinds of propaganda profit out of aggression here and there. But when it comes to really doing something constructive and positive and useful to achieve peace-as I pointed out, they are $180 million delinquent. In case after case after case, they have refused to contribute. And that is why we need a campaign to force them to do so.

Mr. RANDOLPH. Who has carried the load?

Mr. PROXMIRE. The United States of America; there is no question about it.

Mr. RANDOLPH. And we do that too many times, is that not right?

Mr. PROXMIRE. Absolutely. Mr. RANDOLPH. In international ef

forts, we have every right to expect, especially, as the Senator indicated, a superpower such as the Soviet Union, to move in with its share of their obligations hopefully for the peace of the peoples of the world.

I again say that I am very grateful for the opportunity to join the Senator in such an amendment. I do not want to speak on my past activities in this ·area, but I have advocated for many, many years that we should look very carefully at the Soviet Union. Repeatedly its promises are made, but time after time they are not kept.

When the U.N. was created we had certainly the feeling that all of the nations, including the Soviet Union, would be in partnership, not only, let us say, in principle but in payment of the moneys necessary to keep it in operation. As Senator PROXMIRE has indicated, the U.N. peacekeeping missions are beneficial to world understanding and the protection of human rights of men and women on this Earth.

Mr. PROXMIRE. Mr. President, I again thank my good friend from West Virginia.

The reason, once again, that I offer this amendment is that unless we do speak up, unless we do go on record, unless we have the U.S. Senate act as it has, unless we can persuade the State Department to have their people at the United Nations bring this up and bring this up over and over again, we are not going to get action on it. They will be able to get away with this negligence of their obliga-

tion and their duty to support peacekeeping operations.

People may say, "Well, what good does it do to put in a resolution on the floor and make a speech? That is not going to get anywhere."

It is the only thing that can be doneto speak out on it, let them know about it and, as I say, have the State Department act aggressively and vigorously and call this before the United Nations and remind the other nations that the Soviet Union has not done its job; they have been delinquent in this respect. We should make that clear over and over again. If we do so, I am convinced we are going to get action.

I thank my friend from West Virginia. Mr. President, I yield the floor. Mr. PERCY Mr. President, I have lis

tened with interest to the comments made by my distinguished colleague from Wisconsin, Senator PROXMIRE, the author of this amendment, and the very strongly felt comments made by our distinguished and beloved colleague, Senator JENNINGS RANDOLPH.

The amendment correctly points out that the Soviet Union is $180 million in arrears to the United Nations, mostly for payments related to peacekeeping activities.

As has been aptly pointed out, these U.N. peacekeeping operations are vital in areas like the Middle East and Cyprus. Without these important U.N. forces, additional bloodshed would surely result. It also suggests ways in which the President can encourage the Soviets to make these payments in the future, and they certainly can be and should appropriately be considered for the talks to be held presumably in Geneva early next. year and again between Secretary Haig and Foreign Minister Gromyko, if not before.

The managers of the bill would be perfectly willing to accept this amendment. We recognize the right of the Senator to ask for a rollcall vote. It would be our suggestion that we approach the leadership and see whether or not this vote could not be held perhaps immediately prior to the next rollcall vote that we would have.

Some Senators have inquired about rollcall votes and we did not feel there would be further rollcall votes tonight on this bill. But we can check with the leadership to see whether it could be done at the time of the continuing resolution or at the next time this bill comes up.

Mr. PROXMffiE. Mr. President, I would like to discuss this informally with my friend from Illinois, so I will suggest the asbence of a quorum.


The legislative clerk proceeded to call the roll.

Mr. PERCY. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.


Mr. PERCY. Mr. President, I ask unanimous consent that the pending amendment, the Proxmire amendment, be temporarily laid aside so that we may take up what I consider to be a noncon-

'

troversial amendment proposed by Senators ~ERC!, KASSEBAUM, and LUGAR. After the disposition of that amendment the ne,xt P~nding business would then b~ the Proxmire amendment.

'!'he. PRESIDING OFFICER. Without ObJectiOn, it is so ordered.

UP AMENDMENT NO, 454

Mr. PERCY. Mr. President, I send an ~mend~ent to the desk and ask for its rmmediate consideration.

The PRESIDING OFFICER. The amendment will be stated. The bill clerk read as follows:

The Senator from Illinois (Mr. PERcY) for himself, Mrs. KASSEBAUM, and Mr. LUGAR, proposes an unpnlnted amendnlent numbered 454.

Mr: PERCY. Mr. President, I ask unanimous consent that further reading of the amendment be disensed with.


The amendment is as follows: ( 1) On page 63, beginning with line 21, de

lete section 708 (c) ; and (2) Add the following new section at the

end of the bill: "SEc. . It is the sense of the Congress

that it welcomes the actions of the Government of Argentina. to adjudicate numerous cases of those detained under the National Executive Power of the Argentine Government. The Congress expresses the hope that further such progress will continue, especially with regard to (a) providing information, insofar as the Government of Argentina has information, on those citizens in Argentina listed as 'disappeared' who have died, and (b) those prisoners who have not yet been either released or brought to justice and who are being held at the disposition of the National Executive Power."

Mr. PERCY. Mr. President, because of the inability of Senator KASSEBAUM to be on the floor right now, being engaged elsewhere on official business, I am presenting this amendment on her behalf.

While problems still occur in Argentina, human rights performance has improved. There were 12 confirmed disappearances in 1980 and none so far this year.

Prisoners held by the executive on political grounds have been substantially reduced, though about 1,000 ·remained on January 1.

Recently, we have been receiving documentations from the Argentine Embassy listing prisoners of the PEN that have been released. The state Department reports that as of mid-September, 133 persons have been released, 104 paroled and 5 given right of option to leave the country.

The Argentine Government recently announced that about 840 persons are still imprisoned without charge by the PEN.

However, the consistent release of persons since April suggests that the Argentine authorities are moving in a direction consistent with Senator PELL'S concerns.

The amendment which we offer recognizes the Argentin~ Government's positive efforts on thi~ issue. It makes it clear that there are no specific criteria that must be met before the President


makes his determination concerning human rights improvements in Argentina.

It does, however, convey our hope that Argentina will continue to provide the information requested by Senator PELL and to deal with cases of those being held under the PEN.

I not only express appreciation to Senator KASSEBAUM for offering this amendment, but also to my colleague, Senator PELL, for the deep concern he has expressed on this issue, the very penetrating questions that he put to the President of Argentina when he was here visiting as President-designate and met with us, and for the persistent followup Senator PELL has made in this regard, to see that we can exert the maximum amount of influence in connection with the concerns he has so eloquently expressed.

On behalf of the majority, this amendment is ac'ceptable. I know of no objection to it on this side. e Mrs. KASSEBAUM. Mr. President, this is an amendment to S. 1196 that, I believe, will have a lasting and positive effect on U.S. relations with the Argentine Republic. More importantly in my judgment, the amendment will improve the human rights situation in that country. This amendment woulld strike subsection (c) of section 708 from S. 1196, which concerns the lifting of the 4-yearold U.S. arms embargo against Argentina.

The provision which the amendment seeks to strike from the 'bill requires that in determining whether there has been significant progress in the human rights situation in Argentina before the arms embargo can be lifted particular at tention shall be paid as to whether Argentina has made every effort to account for those citizens listed as disappeared and has provided an actual list of the disappeared.

The provision further requires that Argentina must release or bring to trial all those held under an extraordinary executive authority known as PEN in Argentina.

I believe that the new and extraordinary requirement of this provision would retard both United States-Argentinian relations and the considerable human rights progress that country has witnessed since 1978.

The situation presented by the existing language parallels, I believe, a dilemma we faced with Argentina during World War II. In 1943 we were pressing the Argentine Government to break wilth the Axis powers and to join the war effort. There was a military government in Argentina. The Foreign Minister, Segundo Storni, was pro-Allies. He and others were attempting to move the Argentine Government toward rupture of relations.

Storni sent a letter to Cordell Hull saying that things were moving in the right direction but that it would be helpful in dealing with hardliners if the United States could agree to provide some military materiel to Argentina. He asked Hull for friendship and understanding.

Instead Hull made a public and excoriating reply. Storni was forced to re-

sign. United States-Argentine relations went into a very difficult period even though the Argentine Government did eventually break with the Axis powers.

I believe the eXisting provision will have the unintended effect to undermining those in Argentina who are most sympathetic to our efforts in this country and of strengthening those in Argentina who resent U.S. concerns, and who are the most antiliberal.

We should not be discouraging reasonable interaction between Argentina and the United States by erecting yet another hurdle for our potential friends to jump over before we condescend to having a normal, friendly relationship with them.

Existing generic legislation, specifically section 502B of the Foreign Assistance Act, should be sufficient to protect any remaining human rights concerns with respect to Argentina. If the situation there worsens, the provisions of 502B can be made applicable to Argentina.

Not only must we avoid further deterioration of our relations with Argentina but also we must strengthen existing weaknesses. The June 1 issue of Newsweek describes Argentina as having established an entente cordiale with the Soviet Union during the last 4 years.

Argentina refused to support the U.S. grain embargo after the Soviet Union invaded Afghanistan. The U.S.S.R. and Argentina have exchanged military missions. Argentina has positioned itself in the United Nations with the group of 77 rather than as a reliable voting partner of the West.

Finally, Argentina has been a question mark with respect to nonproliferation issues as evidenced by its not becoming a signatory to the Non-Proliferation Treaty and similar international agreements.

In addition, better relations with Argentina can enhance U.S. security concerns in the region. Argentina controls the straits that shipping and navies must use in transit between the Pacific and Atlantic Oceans if the Panama Canal is closed and for ships too large to use it. That nation's cooperation is necessary to guard those essential sealanes.

Argentina is, therefore, an important component of hemispheric and South Atlantic defense. In addition, Argentina has become an important international grain and meat supplier. Its cooperation is essential to try to bring stability and prderliness to that arena where U.S. economic health is so much at stake. The absence of a close, cooperative relationship with Argentina should be a major concern to us all.

The reason for imposing the 1977 arms embargo against Argentina was human rights. It stands to reason that an improvement in that situation should lead to an end of the embargo. The embargo was without conditions, so should its lifting be.

In Argentina there has been measurable, substantive progress toward the restoration of civilian, democratic rule. The government has started a dialog with civilian political leaders to produce legislation that would permit renewed

political activity by organized parties. Freedom of speech and the press has continued to expand in 1980 and 1981. The ILO has made note of increased labor union activity.

Two major points of criticism of Argentina's human rights record have been the disappearances and the exercise of the arbitrary powers authorized by the national executive power, known as PEN. Both of these situations have dramatically improved. Depending on whose accounting you accept, there have been either no or very, very few disappearances since August 1980.

The number of prisoners held under PEN has significantly decreased from 8,000 in 1977 to less than one-tenth of that now. The number of PEN prisoners who have been either brought to trial or released very recently is impressive, approximately 200 since April 1981. This important progress should not go unrecognized. To ignore this progress or to set up yet another impediment to the improvement in our relations would be most counterproductive and may provide reasons to some to halt the progress.

All of the above is not to say that Argentina has reformed itself into a model democracy. There remains further progress that we must continue to encourage. Amnesty International is continuing to monitor the situation and has certainly made us aware of continuing objectionable policies and incidents.

However, I believe the magnitude has considerably diminished in the last 2 years and shows a dramatic difference from the 1977-78 era. Nonetheless, objectionable policies, should they not continue to diminish, can be monitored and the U.S. policy response can be governed by section 502B of the Foreign Assistance Act which generically addresses all human rights conditions in all countries receiving U.S. arms sales and security assistance.

Mr. President, if I may take a minute more, I want to quote from Joseph Tulchin. one of our leading historians of United States-Argentine relations. Writing about the type of incident I described earlier, including others in more recent history, Tulchin had this to say:

Whenever the U.S. openly pressured the Argentine government to behave in a certain manner, it had the unintended effect of undermining that political faction which was most sympathetic to the U.S. and of strengthening the faction which was most nationalistic, more anti-liberal, and less friendly to the U.S. In other words, interfering in Argentine domestic affairs has the effect, over and over again, of pushing the government further to the right or toward xenophobic nationalism and away from reasonable interaction with the United States.

In conclusion, I would like to bring to the Senate's attention the comments of Secretary Haig to the chairman of our committee: · We seek repeal of this legislation for a

number of reasons. There is a strategic need to consider some military sales, for example, to enhance the security of the South Atlantic. The legislation no longer is supported by the human rights situation in Argentina which has improved significantly since 1978. The legislation sets ba.ck 0'\11' human rights and other intereata.


I believe that Secretary Haig's comments are wholly justified and correct. We should not hinder ourselves with requirements upon a country we seek to bring clooer that will only impede the strategic and humanitarian objectives that we all seek.

I urge the adoption of my amendment.•

MILITARY SALES TO ARGENTINA

Mr. KENNEDY. Mr. President, we have before us proposed legislation-section 708 of the Foreign Assistance Act of 1961-which would lift the prohibition o! security assistance to Argentina, under section 620(b) which I am proud to have coauthored in 1977 with Senator Hubert Humphrey, and would require a Presidential certification that Argentina has made "significant progress in complying with internationally recognized principles of human rights" before such assistance can be furnished.

Issues vital to United States-Argentine relations are the continued violations of human rights in Argentina, and the military junta's continued refusal to restore democracy to the Argentine people. Other relevant issues include security in the hemisphere, particularly with regard to the junta's military confrontation with Chile over the Beagle Channel dispute; its actions in Bolivia and El Salvador; its role in damaging U.S. policies regarding the Soviet Union; and its continued refusal to pursue an acceptable approach to nuclear nonproliferation.

Until the Kennedy-Humphrey amendment was enacted because of gross and consistent abuses of fundamental human rights by the Argentine military junta, up to 15,000 Argentine citizens had disappeared-a euphemism for the secret kidnaping, imprisonment, torture, and murder of men, women, and children by Argentine security forces. Until that time, 8,000 Argentine citizens were held without charge or trial under the so-called national executive power.

Fortunately, there have been some relative improvements since enactment of our legislation. In 1979, for example, there were 44 confirmed disappearances and last year there were 12. The number o! prisoners being held under executive powers has been reduced to about 900 and releases continue. On many of these cases, I have intervened with the Secretary of State and the Government of Argentina. Three of those prisoners have since been released.

These developments are welcome, but they cannot be allowed to obscure the broader picture. As we examine the overall situation, it is obvious that this is not the time to resume any security assistance to Argentina, and I do not interpret the legislation before us as permitting the administration to do so.

The military junta in Argentina continues to refuse to account for the thousands of people who disappeared at the hands of the security forces.

The military junta in Argentina continues to hold hundreds of people at the disposal of the executiv~without charge or without any stated reasonin utter disregard for the basic human right to learn the reasons for one's detention, or to be released.

The military junta in Argentina continues to refuse the right of option to leave the country-a right guaranteed by their own constitution-to scores of persons.

The military junta in Argentina continues to tolerate the use of torture against its opponents-two instances occurring as recently as during the visit of the Argentine president-elect to the United States this past spring.

To ignore these facts about Argentina would be to send the wrong message to all those around the world who believe that human rights are an important element in our relations with other countries-the wrong message that the U.S. Congress is willing to accede to a policy of silence and retreat on human rights. I know there are many who hope that will not be the case. But for any who have talked with leaders from Latin America, I can state without question that providing military assistance to Argentina now would have far-reaching effects, undermining U.S. relations with democracies in Latin America and elsewhere in the world.

To ignore these facts about Argentina would be to ignore the reality that members of the junta exercise dictatorial powers and serve as commanders of the military forces which were responsible for the planning and organized abduction, torture, and disappearance of as many as 15,000 persons.

These victims were not civil war victims. They were not taken in guerrilla hideouts or battles. They were kidnaped from their homes, their businesses, or while walking on the street by official agents of the Argentine police and armed forces. Those kidnapings were followed by torture and, in many cases, summary executions. The full details of thousands of cases remain hidden-and we may never know the whole, awful truth.

To ignore the facts about Argentina would be to ignore the failure of the military junta, even now, 5 years after it came to power, to tell the families of the disappeared why or how their sons, daughters, husbands, or wives were taken, where they were taken, or whether they died. Each week in Buenos Aires mothers and relatives of the disappeared meet in a main square of the capital as a visible reminder that they are still searching for their loved ones.

And all our State Department can do is to say that this is a "serious political problem" for the Argentine Government. I ask unanimous consent that my recent exchange of correspondence with the State Department about the disappeared and other human rights issues in Argentina be entered into the REcoRD at the conclusion of my remarks.

To ignore the facts about Argentina would be to tell hundreds of Argentines that it does not matter that they are being held at the whim of their government-without charge, without explanation, without trial, and without any assurance of ever being released. Their arrests were arbitrary, their imprisonment was arbitrary, and their only hopes depend not on any system of law but on the arbitrary decisions of their military rulers.

To ignore this political imprisonment in Argentina is to ignore one of the most glaring and ongoing occurrences of denial of due process of law in the Americas.

The Argentine military underlines its rejection of due process by refusing the pleas of those imprisoned to be allowed the option-guaranteed by the Argentine Constitution-to leave the country.

Not once, but every year since 1975, the Argentine military has been cited by the Inter-American Commission of Human Rights of the Organization of American States for gross and consistent violations of human rights. Respected international human rights organizations ranging from Amnesty International and the Interna· tional Commission of Jurists to U.S. private groups such as the American Association for the Advancement of Science have joined in the condemnation.

Only this year, the American Association for the Advancement of Science reP?rted on the torture, imprisonment, and disappearance of scientists in that country since 1976. The AAAS citations of disappearance are matched by similar reports from international organizations representing many other sectors of society--such as teachers, labor leaders journalists, lawyers, and doctors. All hav~ published documentary evidence of the gross abuse of individual liberty and ind_ividual rights committed by the Argentme Government against members of these professions.

Mr. President, the number of recent examples of human rights abuse in Argentina is far from small:

In January, the United Nations working group on enforced or involuntary disappearances reported on a list of 16 secret detention centers in Argentina.

In December and in January, Amnesty International received reports of 23 prisoners being transferred between two of these detention centers subjected to severe beatings by military guards.

On February 28, leading human rights leaders, including Emilio Mignone and Jose Westerkamp, were illegally abducted and held incommunicado before being released following international protest.

On March 13, between 40 and 60 members of the Mothers of the Plaza de Mayo were detained, harassed, and questioned.

In mid-March-even while President Viola was in the United States being ho~ted by President Reagan, two labor umon officials were kidnaped by Buenos Aires provincial police, held incommunicado, and tortured before being released.

This spring as well, the 1980 recipient of the Nobel Prize for Peace, Adolfo Perez Esquivel, his children, and colleagues in his human rights organization were subjected to bomb and death threats and to direct intimidation.

In July, the president and vice president of the Mothers of the Plaza de Mayo, the organization of families of the disappeared, were detained upon their return to Argentina from the United States. They had traveled here to receive the Rothko Chapel Award for their courage and commitment to justice and had appeared on the Bill Moyers television program. Their award, documents and the tape cassette of the Moyers pro-


gram were seized and returned only after vigorous protests were mounted from the United States.

Journalists have been exposed to continued threats and abuse. In August, the international edition of Newsweek, with a cover story critical of Argentine human rights violations was seized from all newsstands.

On September 2, 16 armed men in plain clothes broke into a Peronist party office, identified themselves as federal police and seized party members Julio Barbaro and Juan Gallegos. Afterward, the police denied knowledge of the seizure. Only after immediate and vehement international protests, and without official explanation, the two were released 3 days later.

Moreover, anti-Semitism remains a poorly disguised reality among many in the Argentine military. Nazi swastikas worn on the watch chains of prison guards, and brazenly painted on prison walls, have been reported. The failure of the government to take action against blatant evidence of anti-Semitism within the military makes them at least complicit in the spread of that evil doctrine. The voice of Jacobo Timerman, and his powerful book, "Prisoner Without a Name, Cell Without a Number," stands as stark, almost unbearably painful witnesses to human abuse and degradation in Argentina.

Instead of using diplomatic and legal means at our disposal to urge the military junta in Argentina to restore full respect for human rights, for democracy, and the rule of law in Argentina, the Reagan administration lias sent a highlevel delegation of military officers to visit. I voiced my concern over this visit in a letter to Secretary of Defense Weinberger in April, and I regret to say that Secretary Weinberger's response was not very enlightening as to the wisdom of what the administration is doing. Mr. President, I ask unanimous consent that my exchange of correspondence with the Secretary of Defense be entered into the RECORD at the conclusion of my remarks.

Some people urge a relaxation of U.S. policy citing the convergence of United States and Argentine security concerns. The record does not support such an argument. For example, Argentina has repeatedly been accused of involvement in the July 1980 coup in Bolivia which toppled the elected government and constitutional law-this in direct opposition to U.S. policy under both the prior and

. the present administrations. Moreover, Argentina is reported to

have offered military assistance to the ruling junta in El Salvador. Such a move would be most unfortunate, exacerbating that tragic conflict with further military intervention, when what is needed is military disengagement and a mediated, negotiated solution.

Argentina has also rejected the decisions of international arbitrators in its boundary dispute with Chile in the Beagle Channel-placing itself in opposition to the concept of peaceful resolution of international disputes.

The administration appears interested in Argentine support for an anti-Soviet strategy in the South Atlantic as well

as on a global basis. This desire fties in the face of Argentine actions undercutting the grain embargo against the Soviet Union after the Russian invasion of Afghanistan. Despite the assertion by the Secretary of State that Argentina is our friend-not least because officials there state their belief in God-the actions of the Argentine Government speak louder than these words and point to a rather sharp disregard for American interests. Not only did Argentina ignore the embargo, but it acted quickly to boost its own ·grain sales to the Soviet Union by nearly 400 percent, further undermining tihe policy of the United States and our allies.

And in the vitally important matter of preventing any further proliferation of nuclear explosives, Argentina's behavior appears calculated to frustrate American policy and AmeriC'an initiatives. During the first years of the previous administration, Argentina publicly committed itself to adhere to the Treaty of Tlatelolco, accepting thereby fullsc•ope s·afeguards on all its nuclear facilities. These pious words stand in stark contrast to recent agreements concluded with West Germany and Switzerland, which were strongly opposed by the United States. They not only undercut our Nation's nonproliferation policy, but also that of our ally and neighbor, Canada. Before any military or nuclear assistance were to be considered, Argentina should fulfill its declared commitment by accepting full-scope safeguards.

The question before the Senate today is whether to accede to the lifting of the absolute prohibition of section 620(b) against the provision of military assistance to the Argentine Government at this time. The administration sought its unconditional removal. The committee has required significant human rights progress as a condition for such assistance. The President must certify that this condition has been met, and the Congress believes it is to be met by accounting for the disappeared, releasing or bringing the PEN prisoners to justice, and ending further violations of human rights in that land.

Maintaining the conditions established in the committee is a minimal necessity. If the administration seeks now to certify that these conditions have been realized, I believe that the Foreign Relations Committee should hold full and detailed hearings to evaluate the evidence cited in their justification. As I have noted, I do not believe it possible that the conditions have, in fact, been met at this time.

Mr. President, I believe that the record of Argentina's actions in the areas of fundamental interest to the United States-in human rights and democratic government, as well as in its dealings with Bolivia and other states in the Western Hemisphere; and in its obstruc· tion of U.S. policies dealing with the Soviet Union and with nuclear nonproliferation-demonstrates clearly that Argentina's professions cannot yet be accorded the credibility that they may one day acquire.

When actions match rhetoric, then I shall be as willing as any Senator to

consider security and other assistance for Argentina. At present, I shall vote for the compromise worked out in the committee, with the expectation that military assistance will not be provided to Argentina without a full justification by the administration and a thorough examination by the Senate, and especially by the Committee on Foreign Relations.

There being no objection, the material was ordered to be printed in the RECORD, as follows:

U.S. SENATE, Washington, D.O., March 19, 1981.

Hon. ALEXANDER M. HAIG, Jr., Secretary of State, Washington.

DEAR AL: Following your meetings thls week with President Viola., we are writing to request that you intervene on behalf of polltica.l prisoners and those men, women and children who have "dlsa.ppea.red" in Argentina.. Former Secreta.ry of State vance delivered an ea.rlier list to the Government of Argentina, making clear that there could be no m111ta.ry rela. tions until some accounting was made and prisoners released.

As you know, Senator Hubert Humphrey joined us and other Senators in introducing legislation in 1977 to end all m111tary aid and support to Argentina because of the extremely serious violations of human rights in that country. Since the military coup in 1976, up to 15,000 individuals have been seized by security forces and then "disappeared". Periodically these disa.ppea.rances continue: just this past week, two more were abducted by Buenos Aires provinical police. held incommunicado, and tortured before being released.

Amnesty International, the Inter-American Commission on Human Rights, the U.N. Human Rights Commission and other international human rights groups have documented extensive use of torture and violations of fundamental human rights; and even today, there a.re several thousand political prisoners who have been denied due process as well as the right of option to depart their country guaranteed by the Argentine Constitution. We a.re enclosing a list of particularly pressing humanitarian cases.

We believe there wlll be signUlcant Congressional and public opposition to u.s. mmtary aid to Argentina until its milltary junta accounts for the "disa.ppea.red", releases political prisoners, and respects the rights of its citizens. You may be aware that each Thursday, mothers of the "disappeared" hold a. vigil in Buenos Aires;' last week they were arrested by security pollee. We have met with some of them in the past and found their cases compell1ng reason for our country to continue to urge disclosure of the facts about their children and their grandchildren. We are making available to your Department all of the cases raised by these mothers with us, some of which a.re included in the enclosed list.

We hope that you wlll raise these concerns directly with President Viola and express your own support for these alms, as well as for the return to ci v111a.n rule and free elections 1n that country. To do so wm be in the best traditions of our nation, and Argentine respect for freedom and human rights will make an essential contribution to increased stab111ty and security in our Hemisphere.

With our thanks, and best personal wlshee, Sincerely,

EDWARD M. KENNEDY. ALAN CRANSTON.

POLITICAL PRISONERS-ARGENTINA, MARCH, 1981

Jorge Albert Tala.na.-OAS/IACHR ca.ae 2353. Detained by Federal Pollee 1n Buenoa Aires April 6, 1976.

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22545 Gustavo Westerkamp-QAS/ IACHR case

2127. Arrested October 21, 1975, held without charges or trial.

Raul Hector Cano-QAS/ IACHR case 3482. Detained at the disposition of the Executive since May 27, 1976.

Norberta Ignacio Liwsky-QAS/IACHR case 3905. Held at the disposition of the Executive since April 25, 1978.

Monica Maria Candelaria Mignone-OAS/ IACHR case 2209. Abducted from her parents' home May 14, 1976.

Debora Esther Benshoam-Since kidnap in August, 1977, no charges have been brought against her.

Pablo Klimovsky-Abducted April 20, 1975. Now held at the disposition of the Executive.

Alberto Maximo Schprejer-Abducted January 30, 1976, held without hearing at the disposition of the Executive.

Horacio Rene Matoso-Arrested October 8, 1976, held without charge or trial.

Duilio Blas Aponte--Arrested November 18, 1974. Charged and acquited, now held at the disposition of the Executive. Right of option to emigrate rescinded.

Maria do las Esperanzas Bel tramino de Loto-Arrested with her husband September 25 , 1976-he is a "disappeared" person, she has been held at the disposition of the Executive, her right of optdon to emigrate having been rescinded.

Rodolfo Juan Begnardi-Arrested November 9, 1975, held without trial at the disposition of the Executive.

DEPARTMENT OF STATE, Washington, D.C., March 31, 1981.

Hon. EDWARD M. KENNEDY, U.S. Senate.

DEAR SENATOR KENNEDY: Thank you for your letter of March 19 expressing your concern over the human rights situation in Argentina and asking that Secretary Haig raise these concerns with President-designate Viola and other Argentine officials.

This administration is committed to the protection and promotion worldwide of individual freedoms and legal rights. Through the use of quiet, private diplomacy we have and wm continue to pursue this important interest within the context of our overall strategic, hemispheric and security interests.

In Argentina, there have been significant improvements in human rights. There have been no confirmed disappearances this year. The number of persons held by the Executive on other than common criminal charges has been reduced from about 8,000 in 1977 to under 900 today. Greater press and judicial discretion exists. We expect this progress to continue.

The issue of accounting for the disappeared is the most difficult human rights issue facing the Argentine Government today. To the extent that it raises concerns of the military over recriminations and reprisals by a future civ111an government, it impedes progress in other important areas such as restoration of due process and return to democratic rule. Over the longer term, we expect the Argentines themselves w111 resolve this issue. In the interim, we wm continue to use our influence privately and In International fora to encourage Argentine officials in their efforts to make Information available to the families of missing persons.

We have decided to seek repeal of Section 620B of the Foreign Assistance Act. By imposing blanket restrictions on the sale of military supplies and training to Argentina, this legislation inhibits the accomplishment of our strategic objectives in the hemisphere while not permitting recognition of the considerable progress Argentina has made toward the restoration of due process and rule of law. As in countries without restrictive legislation, we intend to utilize existing leg-

islation and control procedures to take into account the full range of U.S. interests.

Yours sincerely, RICHARD FAIRBANKS,

Assistant Secretary tor Congressional Relations.

U.S. SENATE, Washington, D.C., April10, 1981.

Hon. CASPAR WEINBERGER, Secretary of Defense, Washington.

DEAR CAP: The New York Times, in a front page article on April 8, 1981, reports on visits to Argentina by senior members of the Armed Forces. 'Ihe article mentions General Edward C. Meyer, the United States Army Chief of Staff, and Rear Admiral Peter K. Cullins, commander of the United States South Atlantic forces, as having made visits; and Admiral Harry Train, Commander-in-Chief of the Atlantic fleet and Supreme Allied Commander, Atlantic, and Brigadier General Richard A. Ingram, commander of the Air Force Command and Staff School, as schedu1ed to visit Buenos Aires the week of April 13.

As you know, since the military coup in 1976, up to 15,000 individuals have been seized by security forces in Argentina and then "disappeared". These disappearances are continuing; just last month two more persons were abducted by Buenos Aires provincial pollee, held incommunicado, and tortured before being release. Gross violations of human rights in Argentina led the United States to end all mil1tary aid to that country in 1977, and even today, there are several thousand polltical prisoners who have been denied due process as well as the right of option to depart their country, guaranteed by the Argentine Constitution.

I believe there will be significant Congressional and public opposition to U.S. military aid to Argentina until its military junta accounts for the "disappeared" and gives evidence of substantial improvement in its human rights policies.

I would appreciate learning whether there was or wm be any attempt by U.S. m111tary officers to raise these concerns with their counterparts in Argentina-and if so, how and to what extent these concerns are being pursued. I would also appreciate your personal view of whether repeal of the legislation I sponsored banning military aid to Argentina is consistent with the overriding mandate in Section 502(b) of the Foreign Assistance Act that "a principal goal of the foreign policy of the United States shall be to promote the increased observance of internationally recognized human rights by all countries."

With best wishes, Sincerely,

EDWARD M. KENNEDY.

THE SECRETARY OF DEFENSE, Washington, D.C., May 8, 1981 .

Hon. EDWARD M. KENNEDY, U.S. Senate, Washington, D .C.

DEAR SENATOR KENNEDY: Thank you for your letter of April 10, 1981, expressing your concern over the human rights situation in Argentina and possible opposition to the U.S. returning to more normal military relations with Argentina.

As has been reported, there have been significant improvements on human rights in Argentina. We expect such progress to continue under the Viola administration as the Argentina Government pursues its program to return to a democratic form of government. As you know, President Viola expressed these same expectations to the Congress during his visit in March.

The Administration is pursuing important human rights objectives through the use of

quiet, private diplomacy within the context of our overall national interests. We in the Department of Defense wm continue to work closely with the Department of State on all high level military visits in order to achieve all of our objectives. In support of these objectives, the Department of Defense visits to Argentina will privately encourage, where appropriate, Argentine officials to continue efforts to achieve improvements in the area of human rights.

The Administration believes that through such diplomacy, including high level military visits, we can more effectively influence other governments than is possible through the use of country-specific legislative restrictions. Legislation, such as Section 620B of the Foreign Assistance Act, inhibits our achieving objectives in the national interest and does not permit recognition of the progress Argentina has made toward the restoration of due process and rule of law. We wm be better able to pursue our principal foreign policy goals, one of which is to promote the observance of human rights, by developing more normal relations with the countries which are friendly toward the U.S. Moreover, other legislation and control procedures, such as 502(b), encompass human rights yet stm provide the fiexib111ty required to pursue our interests. For the above reasons, I have supported the repeal of Section 620B of the Foreign Assistance Act and believe such action on countryspecific legislation is not inconsistent with our goal to promote increased observance of human rights.

Sincerely, CAP WEINBERGER.

SECTION 706 (B) ARGENTINA

Mr. KENNEDY. I would now like to inquire of the chairman and the ranking member of the committee whether they share my view that the requirement of "significant progress in complying with internationally recognized principles of human rights" should be interpreted, in the case of Argentina, to include significant progress in providing information on those citizens in Argentina listed as "disappeared" and significant progress in releasing or bringing to justice those prisoners held at the disposition of the national executive power (PEN) .

Mr. PERCY. That is my understanding. If there should be significant progress in providing information on those citizens listed as disappeared and in releasing or bringing to justice those prisoners held at the disposition of the national executive power.

Mr. PELL. I share the view of the chairman and of my friend the senior Senator from Massachusetts.

Mr. KENNEDY. I would ask the chairman and the ranking member whether they could undertake, at this time, to give the closest scrutiny to any such human rights certification by the President on Argentina. I believe this issue is of the greatest importance, not only to the people of Argentina but to the prospects for human rights and democracy throughout this hemisphere.

Would the chairman and the ranking member agree that the full committee will hold a hearing or hearings if the President submits such a human rights certification, to determine whether the committee concurs with the President's finding that "significant progress" has occurred in the human rights situation in Argentina, including those provisions in the bill relating to the "disappeared"


and releasing or bringing to justice those prisoners held at the disposition of the national executive power in Argentina.

Mr. PERCY. We shall certainly give the closest scrutiny to any such human rights certification by the President on Argentina. If there are serious questions about the President's certification, I would be prepared to hold a hearing to determine whether the committee concurs with his finding and whether the committee is satisfied that it includes "significant progress" along the lines suggested by the Senator from Massachusetts.

Mr. PELL. I am happy to concur with the chairman on the need for the committee to be fully satisfied on any human rights certification for Argentina, and I agree with the chairman and Senator KENNEDY that our judgment should be based-as should the President's-on human rights progress which includes significant progress in accounting for the disappeared and releasing or bring to justice those held at the disposition of the national executive power in Argentina.

Mr. President, this is an amendment that I have followed very closely. I have been very interested for months, for years, in the human rights situation in Argentina. Just a few months ago, I had the good fortune to be in Buenos Aires. I met with the leaders of the Argentine human rights movement and also with the mothers of some of the young people who had disappeared, and presumably had been tortured and murdered. Talking with these people made the whole picture come into a perspective that could not have been achieved by any other means. I did not realize until afterwards that, in each case, the leaders with whom I spoke had a child who had disappeared, presumably tortured and murdered.

Mr. President, when you actually talk to people who are so close to this kind of thing, it makes you very, very sensitive, indeed, and concerned. The torture, the abuse of any human being anywhere in the world really should be of concern to us.

In Argentina, there are still many, many human rights problems. I would say, though, that the human rights situation generally has improved. Whereas before 1980, there had been thousands of cases of individuals who had disappeared, in 1980, there were only 12. This year, there has been no reported case of disappearance, although there are still cases of people being arrested and abused and "temporarily disappeared." Prisoners held by the national executive power (PEN) on political grounds have been substantially reduced, although about a 1,000 remained on January 1. I believe the number is about 800, now.

Recently, we have been receiving documentation from the Argentine Embassy listing prisoners of the PEN that have been released. The State Department reports that as of mid-September, 133 persons have been released, 104 parolled and 5 given right of option to leave the country. The Argentine Government recently announced that about 840 persons

are still imprisoned without charge by the PEN.

This figure was confirmed to me just an hour ago when members of the Foreign Relations Committee met with Argentine Foreign Minister Oscar Camilion for an exchange of ideas.

Mr. President, I realize that the substitute amendment is an attempt to communicate in a softer way our concerns to the administration and to the Argentine Government. I personally, as the author of the original amendment, would have preferred to keep the stronger, original language. From a practical viewpoint, however, I have always been of the view that half a loaf is better than no loaf, that a politician who compromises gets better results than one who says with great pride that he never compromises. If we can have an amendment that moves in the direction I wish, acceptable to us all, that is far better than having a vote on one that I know, from counting heads, will go down in defeat at this time. Therefore, I accept the compromise amendment.

Let me add here that I have had the good fortune to meet twice with President Viola prior to his actually assuming office, once in Buenos Aires and once here in the Senate. In each case, I brought up the question of those who disappeared and there was some confusion as to the reply. The first time, in Buenos Aires, the interpreter said that a listing would be issued. Later, I was informed that the interpreter had mistranslated the reply of Mr. Viola, who had said he would do his best.

I went over it a second time with President-designate Viola in a meeting in the Foreign Relations Committee when he was here last March before taking office. I said I had understood from him that there would be a listing of disappearances that would be forthcoming. This was my understanding, and I repeated the question. The President replied affirmatively when I asked if the government would publish a listing of those who are known to be dead. But on President-designate Viola's return to the Argentine, there was apparently a change of view and his statement to me was not confirmed at that time.

Mr. President, I believe this amendment does express the concern of the United States and it will serve to encourage the Argentine Government to provide information on those citizens in Argentina listed as disappeared who have actually died, and those prisoners who have not yet been released or brought to justice and are being held at the disposition of PEN, the national executive power.

While I support this compromise, I want to express my sincere hope that the Argentine Government, and the administration, understand that I and a great number of my colleagues in the Senate feel very strongly about continued progress on human rights, especially with regard to the disappeared and the PEN prisoners.

When one thinks of the disappeared, it is because of the desire for a new

beginning for Argentina, because the parents in many cases have a lingering hope, perhaps, that their child is still alive. We know of the lingering hope that has existed in the hearts of parents who lost young people in Vietnam and of the hopes they nurtured that their child still may be alive. This is true with these mothers with whom I talked and with the leaders of the human rights movement in Argentina. It is to help them with a sense of compassion and humanity so that they will know what happened to their loved ones, as well as to give Argentina a new base for a democratic, compassionate beginning that I believe these listings should occur.

It is my hope, reflecting the bipartisan vote in our committee on the original amendment, that the Argentine Government continues to be responsive to those citizens in Argentina and the international community who look forward to a truly brighter day for all of the people of that proud nation.

Mr. President, I reiterate that this amendment in a stronger form passed the Foreign Relations Committee on a true bipartisan vote and reflects at least the views of the Foreign Relations Committee. This somewhat weakened amendment if it is passed, as I hope it will be, will somewhat represent the views of the Senate as a whole. I hope this amendment will be agreed to by my colleagues.

The PRESIDING OFFICER. The Senator from Illinois.

Mr. PERCY. Mr. President, the amendment having been supported by both managers of the bill, I think we are ready now for a vote on the amendment. I know of no objection on this side.



Mr. PELL. Mr. President, I move to reconsider the vote by which the amendment was agreed to.

Mr. PERCY. I move to lay that motion on the table.


Mr. PELL. Mr. President, I should like the REcoRD to show that when the vote was taken, there was not a single adverse vote to the amendment.

The PRESIDING OFFICER. The question recurs on amendment No. 551.



The bill clerk proceeded to call the roll. Mr. PERCY. Mr. President, I ask



Mr. BAKER. Mr. President, if I may have the attention of the distinguished chairman of the committee and the ranking minority member, I inquire whether there are other amendments that could be disposed of at this time?

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22547 Before the answer, I might say that

what I plan to do, if there are no other amendments that might be dealt with now, is to ask the Senate to recess until 9 o'clock. As Members will recall, the reason for that is that the House of Representatives will not proceed to the consideration of the conference report on the continuing resolution until sometime between 7:30 and 8. It is my hope that the House will complete its action on the conference report and transmit it to the Senate for our attention sometime around 9.

If the distinguished managers of this bill, on both sides, would be agreeable to recessing at this time, I am prepared to do so. If there are other amendments that they wish to deal with at this time, which would not require REcORD votes, I am prepared to do that.

Mr. PERCY. Mr. President, we had hoped to finish a Helms amendment, but Senator HELMS is not prepared to offer it right now. There was a possibility of the Glenn amendment, and so far as J know, he is not planning to come here right now on that amendment.

Therefore, I believe it would be best to recess until 9 o'clock.

For the benefit of all our colleagues, will the distinguished majority leader indicate what might be done at 9 o'clock, when we resume the session, and what might be the logical sequence of events?

Mr. BAKER. I thank the distinguished chairman of the committee.

My plan, then, would be to come back in session at 9 o'clock. If the House has not sent the conference report to us by t~at time-:--and I do not believe they Will-we Will resume consideration of the foreign assistance bill from 9 o'clock until such time as the conference report is available.

We would have RECORD votes after we reconvene a.t 9 o'clock, if they are ordered. There would be no effort to postpone or stop those votes after that hour.

I would expect that the Senate would be in .fairly late, not by choice but by necessity, because tonight at midnight is th~ ~nd of t~e Federal fiscal year; and it .Is ImJ?erative once again, that we deal \!It~ this matter-in this case, the contmumg resolution making appropriations for several agencies and departments of Government.

So, shortly .I will make the request. The Senate Will shortly stand in recess to ~esume c~msideration of the foreig~ a~sistance bill at 9 o'clock, continuing '!lth the c~msideration of the foreign ass~stance bill from that time until such t~e. as the conference report on the contmumg resolution is available, and rollcal~ votes would be expected during that period. A~ soon. as .the conference report is

availabl~, It Will be the intention of the l~adership to send the foreign assistance bill ~ack .to t~~ calendar temporarily, pendmg dispositiOn, while we proceed to the consideration of the conference report.

This is the outlook for the moment.

TRffiUTE TO JOE STEWART Mr. DODD. ·Mr. President, like so many

of my colleagues, I too want to express

79-059 0-85-23 (Pt. 17)

my sincere thanks to Joe Stewart for his many years of service to the Senate in general and to Senate Democrats in particular.

Though a newcomer to the Senate, I am fully aware of the legend that Joe established during his 30 years of service on this side of the Hill. Indeed, the legend precedes him. And I know from my own experience and from the experiences of others that Joe performed his duties always with a view to maintaining the honor and the dignity of the Senate. And his affection for and devotion to the Senate deserve both our respect and our admiration.

In short, Joe has served his Nation well and in the process he has obviously earned our gratitude. Not surprisingly, then, his departure touches us with sadness. But our sadness pales by comparison to our good wishes for him-good wishes for the very best in his new endeavors.

JOE STEWART

Mr. RIEGLE. Mr. President, the Senate recently passed Senate Resolution 214, which commended Joe Stewart for his long service to the Senate. As we all know, Joe has finally broken the 30-year bond with this body, and has accepted employment with a private concern. Joe's history in the Senate is somewhat unique, both for its longevity, and its chronology. His first appointment, in 1951, was as a page to Senator Spessard Holland of Florida. From that point he occupied a variety of positions and ~ltimately became the secretary to the majority in 1979, and secretary to the minority in 1981.

Joe performed a variety of tasks for the Senate, and all of them were invaluable. I appreciate Joe's assistance to me and know that many difficult times have been made easier due to his efforts. The fact that Joe was able to complete both undergraduate and law school while he worked full-time in the Senate is indicative of his boundless energy and motivation. These attributes will serve him well in his new career, and I think that he h'as left his stamp on the SenS~te as a whole.

TRIBUTE TO WALTER JOSEPH STEWART

Mr. MELCHER. Mr. President, Walter Joseph Stewart is an impressive name which I am sure we will hear more and more in the years to come. But Joe Stewart is the name we will remember for his dedicated and incomparable service to the U.S. Senate-and to us as individual U.S. Senators.

Joe Stewart has met our impatient demands with patient and speedy response. The possible, he achieved with ease and clarity; the impossible may have taken a bit longer, but he could usually find a way to do that, too.

Joe's courtesy and calm demeanor under pressure could not mask his dedication and determination to serve the Senate-and all of us who called on him-to the fullest extent possible.

Joe Stewart will be missed by the Sen-

ate. And so will Janine Drysdale-Lowe h~ able assistant who is also leaving th~ Hill. But a well trained and competent staff is the legacy Joe and Janine are leaving· in the Office of the Secretary to ~h.e MinOTity and in the cloakroom. I JOin with those, from pages to Senators in saying thanks for a job well done and best wishes for continued success.

JOE STEWART Mr. BUMPERS. Mr. President, it is my

pleasure to join my good friend the minority leader, in paying tribute t~ the fine work of Joe Stewart.

Joe has served with distinction as secretary for the minority of the Senate, secretary for the majority, and assistant to the majority leader for floor operations. He has been helpful to Members on both sides of the aisle and has done a good job. He has been fair, and he has been ar.commodating to all Senators.

Joe has demonstrated a willingness to wor~ hard. After gradua:ting from Capitol Page School in 1953 as president of his class, he continued to work fulltime in the Senate. Throughout this period in his career, he attended undergraduate and law school. He attained his law degree in 1963 from American University Law School.

In addition ·to the other positions I have mentioned, Joe is a former member of the Appropriations Committee staff and has served as a legislative assistant to Sena:tor R~BERT c. BYRD. He has truly spent his public career in the U.S. Senate.

We will miss him, but we wish him well in his new position in private industry.

THE RESIGNATION OF WALTER J. STEWART

Mr. MITCHELL. Mr. President, the Senate lost one of its most loyal and dedicated servants when Joe Stewart resigned as secretary for the minority. . Joe has begun a new career in private mdustry-one that I hope will prove to be cha~lenging and satisfying for him. But while I am haJPPY for him I know he will be missed here in the sen:ate.

Joe was always available to assist and to provide valuable advice based o~ the knowledge and expertise he gained over the course of his 30-year career in the Senat~. I greatly appreciate the help he has g~ven me, and I will miss him and his able assistant, Jean Drysdale-Lowe who has joined Joe in his new office. '

I know Joe will be successful in his new career. As I join my colleagues in wishing him well, I also want to offer my personal thanks to Joe for his friendship and his loyalty.

FRENCH AND GERMAN PRESS REACTIONS TO ROLAND DECISION

M~. HEFLIN. Mr. President, yesterday ~ delivered ~ speech on this floor expressmg my serious concerns that the recent decision to scrap the Roland air defense system could cause serious repercussions with respect to our diplomatic and military relations with our Western European allies.

Today I wrote to Secretary of State


Alexander Haig asking him to take a personal role in convincing President Reagan to reconsider this action. While Supreme Allied Commander of NATO forces in Europe, Secretary Haig played a pivotal role in reaching the landmark trinational agreement that produced the Roland missile system.

Because of his key role in reaching this accord involving France, Germany, and the United States to build a European-designed missile for deployment in Western Europe, I have urged him to personally intervene and use his influence to convince President Reagan to reverse his administration's apparent decision to scrap the short-range, allweather missile system.

Mr. President, I have spoken with the French Ambassador concerning this matter and he relayed to me his Government's great disappointment in the administration's decision to back out of this agreement.

Further, I have in my hand the English translations of newspaper articles that have appeared in the French newspaper, Le Monde, and the German newspaper, Sud-Duetsche Zeitung. Mr. President, these articles from the capital cities of two of our most important military allies bear out my warning of adverse military and diplomatic reactions to Secretary of Defense Weinberger's recent announcement that the United States is backing out of the Roland agreement.

The article in the German newspaper, Sud-Duetsche Zeitung, dated September 25, 1981, is headlined "U.S. Cancellation of 'Roland' Disappoints Bonn." The article states that "Bonn is extremely disappointed by the decision of the U.S. Government" and that "observers made no bones about the fact that the cancellation could affect the West EuropeanAmerican armament collaboration."

The articles in the French newspaper, Le Monde, dated September 25, 1981, are headlined "The Pentagon Intends To Cancel Its Order for European Roland Ground-Air Missiles," and "Budgetary Reductions May Cause Difficulties." The articles ask the telling question : "Will the fate now awaiting the Roland show t.hat the U.S. would also be the :first to break this reciprocal agreement at a time when the world economy is shaking them?"

Mr. President, the United States made a good-faith agreement with our French and German allies to produce this important air defense system.

Over the past 5 years, we have spent more than $1.2 billion to develop this system. I believe that to cancel the program now, at a time when it is already in production, and in light of adverse diplomatic reactions by our European allies, would not only be wasteful, but very unwise.

Mr. President, I urge my colleagues to take a personal interest in this matter and study the ramifications of canceling this project.

I ask that copies of the French and German newspaper articles appear in the RECORD at the close of my remarks, along with a copy of my letter to Secretary of State Haig.

There being no objection, the material was ordered to be printed in the RECORD, as follows: [From Siid-Deutsche Zeitung, Sept. 25, 1981] U.S. CANCELLATION OF "ROLAND" DISAPPOINTS

BoNN (Negative consequences are !eared for West

European and American armament cooperation.)

Bonn 1s "extremely disappointed" by the decision of the U.S. government to not take over the German-French air-defense missile system "Roland". Although the government declined in taking an official position on Thursday, observers made no bones about the fact that the cancellation could affect the West European-American armament collaboration.

The American defense minister, Caspar Weinberger, announced last Wednesday before the budget committee of the House of Representatives, that the Roland system would not be bought by the U.S. in view of shortages in the mmtary budget. The $477 mlllion that had been allocated would be sacrificed to the red ink.

Roland is the most up-to-date low-altitude air-defense system in the world that is mounted on a tank. It was selected by the U.S. for the American armed forces in 1975 after hard-fought competition and was to be built under license in the U.S. The test of the missile system in America and its selection for the U.S. Army were seen to be substantial milestones in the Roland development program. The "two way street" across the Atlantic in regards to reciprocal purchases of arms was to be expanded in decisive measures. Up to now West Europeans, principally West Germany, have bought more weapons from the USA than the other way around. West Germany's capital (Bonn) showed understanding !or the possibly necessary cancellations in the U.S. military budget. However, one has to ask if there were not other factors that played a role in the cancellation. The U.S. Army has long made it no secret that they would prefer an American missile to the German-French coproduction.

According to the judgment of experts, congress and circles in the American armament industry also have a basic reluctance with regards to purchasing European weapons in larger amounts, as had been held out as a prospect to the Europeans by the government of the previous President, Carter.

[From Le Monde, sept. 25, 1981] THE PENTAGON INTENDS To CANCEL ITS ORDER

FOR E'trROPEAN ROLAND GROUND-AIR MISSU.ES WASHINGTON (REUTER) .-The American

government has decided to cancel the purchase of French-German Roland anti-aircraft missiles because of U.S. defense expense deductions. This was expressed by Mr. Caspar Weinberger before a budgetary commission of the House of Representatives, where he gave for the first time the precisions concerning the federal military expense reduction (about $2 billion) !or the year 1982, starting next October 1st.

Besides the franco-german missile renouncement (at a cost of $477 million for 1982), the Reagan administration planf? on delaying or stopping the expenses for other programs: mothball ten ships, stop the order of the KC-10 refueling airplanes, reduce the number of AlO Fairchild anti-tank planes, withdraw the old Titan-2 missiles and the B-52 bombers and postpone the armored vehicles order.

Mr. Weinberger declared that President Reagan intended to reduce $2 billion defense expenses for next year and $11 b1llion !or the next two budget years. The U.S. Army has chosen the Roland for the needs of antiaircraft defense of its divisions stationed in

Europe with a date for first delivery in 1981. Respectful oi the government instructions "Buy American Act", the American Army had obtained a license from the Euromlsslle consortium to manufacture the weapon system by Hughes and Boeing, against payment of royalties. This American program was evaluated at between 2 and 3 billion dollars at the beginning. In the meantime, the American Roland suffered numerous restrictions: from 600 fire platforms, the order !ell to 200 2 years ago and remains at that level today.

The Roland is a supersonic missile with a range of 7 kilometers and is used in an allweather configuration. It is conceived as an anti-aircraft defense against low-flying planes. It can be installed on an AMX-30 French tank, on the German Marder and on the U.S. M-109.

(From Le Monde, Sept. 25, 1981) TRANSATLANTIC ARMS DEBATE

(Budgetary reductions may cause ditflculties.)

The franco-german Roland program, a.lrea.dy hurt by the 1981 decision by Bonn to indefinitely postpone part of its Roland purchases, would receive a finishing stroke if the Washington cut threats come true. Excluding the U.S. Army needs, the Roland market for. this decade was supposed to be equivalent to that of the F-16 sales in Europe, what was called "the contract of the century". It is therefore understandable that the European manufacturers follow with keen interest the debate of this question by Congress and stress the importance of this decision.

But the main point of what could become tomorrow a heavy transatlantic contentious debate is of political nature, touching to the basic understanding between allieds and NATO.

The U.S. have, in the past, proposed the "two-way street" idea, that is to say, a technology exchange between members of the atlantic alliance through which each party engages in favoring, by its mllitary purchases, the production in which their partners excel most. Will the fate now awaiting the Roland show that the U.S. would also be the first to break this reciprocal agreement at a time when the world economy is shaking them?

The European industrla.Usts do not give credit to such an egotistic initiative and rather believe that in order to drive Reagan into a comer the Pentagon ha.s purposely chosen to interrupt an a.nna.ment project that Congress would quickly re-establish in order to safeguard the diplomatic understanding between a.llies.

U.S. SENATE, Washington, D.C., September 30, 1981.

Han. ALEXANDER M. HAIG, Jr. Secretary of State, Department of State,

Washington, D.C. DEAR MR. SECRETARY: I am deeply con

cerned over the Department o! Defense's decision to scrap the Roland Air Defense System. I fear this action wlll significantly damage our military strength in Western Europe and could have a devastating effect on our diplomatic and military relations with European allies.

It is my understanding that as Supreme Allied Commander of NATO forces in Europe you played a. major role in reaching the trinational agreement involving France, Germany, and the United States to produce the Roland missile system. I have been told that this landmark accord was the result of lengthy negotiations for a Europeandesigned weapons system which would be fully compatible with existing European weapons.

Because o! your pivotal role in developing the Roland missile system, I am asking you to personally intervene and use your influence in order to convince President Rea-

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22549 ga.n that canceJ.ling the Roland system would be a serious mistake.

I do not have to describe to you the critical importance of this short-range, allweather missile to the defense of Western Europe. Nor do I have to warn you of the potential damage the scrapping of this missile could cause to our already delicate relations with our military allies in Europe.

Mr. Secretary, you are in a unique position, having served as Supreme Allied Commander and now as Secretary of State. I urge you to take a personal interest in this important matter. I am confident that after President Reagan has received your wise counsel and has weighed the potential damage this decision could cause, he will make the proper decision.

With warmest regards, I am, Sincerely,

HOWELL HEFLIN.

MEETING OF THE BOARD OF GOVERNORS OF WORLD BANK AND INTERNATIONAL MONETARY FUND Mr. PERCY. Mr. President, yesterday

morning I participated in the opening ceremonies of the annual meeting of the World Bank and International Monetary FUnd. President Reagan gave a welcoming address which I would commend to my colleagues. The President recognized the important role the IMF and World Bank have played in the post-World War II period, and stressed our future commitment to those institutions. He also urged those institutions, and their member governments, to recognize the importance of economic policies which reward individual labor and risk taking. He believes, as I do, that economic growth can best be fostered in industrial and developing countries, by unleashing the enormous human capacity which exists everywhere, if it is not constrained by unnecessary bureaucracies and regulations.

But in addition to intelligent domestic policies, the President also acknowledged the need for international cooperation through institutions such as the World Bank and IMF, so as to maintain an open trade and financial system and to facilitate the development of low-income countries. I ask unanimous consent that the President's remarks be included in the RECORD.

There being no objection, the remarks were ordered to be printed in the REcORD, as follows: TEXT OF THE ADDRESS BY THE PREsmENT TO

THE 1981 ANNUAL MEETING OF THE BOARD OF GOVERNORS OF WoRLD BANK AND INTERNATIONAL MONETARY FuND On behalf of the American people, I am

delighted to welcome you to Washington for your 36th Annual Meeting. It seems your deliberations take on a.dded importance each year, and this year will be no exception. I believe your meeting can strengthen the national resolve and international cooperation required forr the global economic recovery and growth we all are striving to achieve.

I am very grateful for this opportunity to address your distinguished group. It is customary to begin a speech before this Annual Meeting with a portrait of the serious problems and challenges we face today in the world economy. Those problems and challenges a.re certainly there-in force-and I wm return In a. minute to review them.

But first, let me take just a. moment to salute the institutions you represent. The

IMF and World Bank group have contributed enormously to the spread of hope-to a better life throughout the world community. In the process, they have proven themselves capable of change, of adapting to new circumstances and the needs of new members.

Your institutions have worked tirelessly to preserve the framework for international economic cooperation and to generate confidence and competition in the world economy. They have been inspired by the ideal of a. far better world in which economic growth and development would spread to all parts of the globe. For more than three decades, they have worked toward these goals and contributed to results that are now clearly visible to all.

This past decade in particular has tested the mettle and demonstrated the strength and merit of the World Bank and IMF. As the development report of the World Bank itself notes:

"The 1970s witnessed international economic convulsions at least as serious as any that may be thought highly probable in the next 10 years. The world economy's capacity to withstand shocks has been severely tested. The tests were not passed with entire success . . . but parts of the developing world have come through remarkably well."

We need to recognize our progress and talk about it more in our conversations With one another. This in no way denies the immense problems we face. But without some sense of what we have achieved, without some enoouragement to believe in our mission, we will succumb to defeatism or surrender to ill-advised solutions to problems that can never yield to grandiose schemes.

To look at the challenges before us, let us recall that vision we originally set out to reach through international cooperation. The Second World War had left us with the realization, born out of the suffering and the sacrifices of those years, that never again must human initiative and individual liberties be denied or suppressed.

The international political and economic institutions created after 1945 rested upon a. belief that the key to national development and human progress is individual freedom, both political and econoinic.

The Bretton Woods institutions and the GATT established generalized rules and procedures to facilitate individual enterprise and an open interna.tiona.r trading and financial system. They recognizee[ that econoinic incentives and increasing commercial opportunities would be essential to economic recovery and growth.

We who live in free market societies believe that growth, prosperity, and ultimately huxnan fulfillment, are created from the bottom up, not the government down.

Only when the human spirit is allowed to invent and create, only when individuals are given a. personal stake in deciding econoinic policies and benefiting from their successonly then can societies remain economically alive, dynamic, prosperous, progressive and free.

Trust the people. This is the one irrefutable lesson of the entire post-war period contradicting the notion that rigid government controls are essential to econoinic development.

The societies which have achieved the most spectacular, broa.dba.sed econoinic progress in the shortest period of time are not the most tightly controlled, nor necessarily the biggest in size, or the wealthiest in natural resources. No, what unites them all is their willingness to believe in the magic of the market place.

Everyday l.tfe confirins the fundamentally human and democratic ideal that individual effort deserves economic reward. Nothing is more crushing to the spirit of working people and to the vision of development itself than the absence of reward for honest toil and legitimate risk. So let me speak plainly:

We cannot have prosper.ity and successful development without economic freedom. Nor can we preserve our personal and political freedoms without economic freedom.

Governments that set out to regiment their people with the stated objective of providing security and liberty have ended up losing both. Those which put freedom as the first priority also find they have also provided security and economic progress.

The United States is proud of its contributions to the goals and institutions of postWar development. You can count on us to continue to shoulder our responsibilities in the challenges we face today.

We see two of overriding importance: Restoring the growth and vitality of the

world economy; And assuring that all countries, especially

the poorest ones, participate fully .tn the process of growth and development.

But let us remember, the most important contribution any country can make to world development is to pursue sound economic policies at home. Regrettably, many industrial countries, including my own, have not made this contribution in the recent past. We have overspent, overtaxed and overregulated, with the result being slow growth and soaring inflation. This stagflation, as the IMF annual report notes, is one of two basic problems we must quickly overcome.

The United States has set its course to economic recovery. Our program is comprehensive, and as I reminded the American people last Thursday evening, it will require effort and patience. But the reward is worth working for.

By reducing the rate of Government spending, honoring our comm.ttment to balance the budget, reducing tax rates to encourage productive investment and personal savings, eliminating excessive Government regulation, and maintaining a. stable monetary policy ... we are convinced we will enter a. new era. of sustained, noninfi.a.tlona.ry growth and prosperity, the likes of which we have not seen for many years.

And as the world's largest single market, a. prosperous, growing U.S. economy will mean increased trading opportunities for other nations. America. now receives half of an non-OPEC developing country exports of manufactured goods to all industrialized countries, even though we account for only one-third of the total gross national prOduct of those industrialized countr.tes. Lower U.S. inflation and interest rates will translate into increased availability of financial resources at affordable rates. Already, capital markets in the United States are more accessible to the developing countries than capital markets anywhere else in the world. No American contribution can do more for development than a. growing, prosperous U.S. economy.

The domestic policies of developing countries are likewise the most critical contribution they can make to development. Unless a. nation puts its own financial and economic house in order, no amount of aid wm produce progress. Many countries are recognizing this fact and taking dramatic steps to get their economies back on a sound footing. I know it's not easy-but it must be done.

Only with a. foundation of sound domestic policies can the international economic system continue to expand and improve. My own Government is committed to policies of free trade, unrestricted investment and open capital markets. The financial flows generated by trade investment and growth capital flows far exceed official development assistance funds provided to developing countries.

At the same time, we are sensitive to the needs of the low-income countries. They can benefi. t from in tern a. tlonal trade and growth in the industrial countries because they export xnany raw materials and primary products the industrial world needs. But they also


depend upon our aid to strengthen their economies, diversify their exports and work toward self -sufficiency.

The United States recognizes this. Over three decades, we have provided more than $130 billion in concessional assistance. The American people have proven themselves to be as compassionate and caring as any on Earth. And we will remain so.

We strongly support the World Bank. And because of our strong support, we feel a special responsibility to provide constructive suggestions to make it more effective. We believe these suggestions will permit it to generate increased funds for development and to support the efforts developing countries are making to strengthen their economies. Taklng into account our budgetary constraints, we are committed to providing the Bank and [DA resources for them to continue and im:>rove their contributions to development. · we know that stimulating private investnent is also critically important. The Inter:lationa.l Finance Corporation plays the lea.d.ng role in the bank family in support of ;uch investment. Given the importance of ~his role, we hope it can be enhanced. We believe all facets of the Bank can play a more ~.etive role in generating private resources md stimulating individual initiative in the development effort.

The IMF also plays a critical role in estabLishing conditions to encourage private capltal flows to deficit countries. By reaching agreements with the IMF on a sound, comprehensive, stabilization program-and by demonstrating its determination to implement that program-a borrowing country signals private markets of its intent to solve its own economic problems.

We are committed to a pragmatic search for solution·s to produce lasting results. Let us put an end to the divisive rhetoric of us versus them, North versus South. Instead let us decide what all of us-both developed and developing countries--can accomplish together. Our plans for the Caribbean Basin are one example of how we would like to harness economic energies within a region to promote stronger growth. The design and success of this undertaking depends upon the cooperation of many developed and developing countries.

My colleagues and I also look forward to the upcoming summit meeting at Cancun, Mexico. That occasion will provide us with fresh opportunities to address the serious problems we face and encourage each other in our common mission.

In conclusion, each of our societies has a destiny to pursue. We have chosen ours tn light of our experience, our strength and our faith. We each are ultimately responsible for our actions and the · successes and failures that they bring. But while individually responsible we are also mutually interdependent. By working together through such institutions as the IMF and World Bank we can all seek to collaborate on Joint problems, share our lnslKhts, and encourage the common good.

These institutions have reflected a shared vision of growth and development through political freedom and economic opportunity. A liberal and open trade and payments system would reconstruct a shattered world and lay the basts for prosperity to help avoid future conflicts. This vision has become reality for many of us. Let us pledge to continue working together to ensure it becomes a reality for all.

Thank you very much.

PRESENTATION OF THE NCOA ''L. MENDEL RIVERS AWARD FOR LEGISLATIVE ACTION" TO SENATOR WILLIAM L. ARMSTRONG Mr. THURMOND. Mr. President. on

Tuesday, September 22, 1981, I was privUeied to assist the Noncommissioned

Officers Association <NCOA) of the United States of America in recognizing Senator WILLIAM ARMSTRONG Of Colorado as the 1981 recipient of the NCOA "L. Mendel Rivers Award for Legislative Action."

This award was first given in 1972. It was a means for the association to pay tribute to an outstanding Senator or Congressman, who through dedication and devotion, exhibited great courage in support of patriotism and the U.S. Armed Forces. The association appropriately named the award in honor of a great American patriot and friend of our Armed Forces, the late Congressman L. Mendel Rivers of my home State of South Carolina.

Mr. President, I am certain that my distinguished colleagues will agree that the NCOA has selected one of our most able Members to receive its prestigious award. It was Senator ARMSTRONG that NCOA officials approached in 1979, seeking his support of increases in pay for military personnel of the active, Reserve, and National Guard forces. Senator ARMSTRONG not only promised to give his support, but he acted almost immediately to bring the matter to our attention.

Senator ARMSTRONG did not rest until Congress realized the plight of our service members and enacted legislation that gave military personnel a fair and equitable pay increase. In addition, he worked diligently to provide equal per diem payments for both officers and enlisted members of our Armed Forces.

Mr. President, twice in early 1980, Senator ARMSTRONG made attempts to add amendments calling for pay hikes for the military to certain legislative proposals. Although he was blocked in these efforts, he did not lose the war. His bulldog determination and his unabashed love for our servicemen and women caused the Senate Armed Serv .. ices Committee to take note and act accordingly. Subsequent investigations revealed that many experienced and skilled noncommissioned Qfficers and'petty officers were leaving the military services because of inadequate pay and allowances.

The efforts of Senator ARMSTRONG resulted in increases in military compensation in 1980 and again this year. We will soon have a new Armed Forces pay bill going to President Reagan for his signature. The bill will provide more pay comparabili'ty and relieve some compression in those grades that have experienced low retention rates.

Senator ARMSTRONG is truly deserving of this distinguished award. He has listened to the plea of 250,000-plus members of the NCOA who are noncommissioned and petty officers of the Armed Forces. Our distinguished colleague reacted, not with words, but in deeds. He accomplished the task against great odds.

Mr. President, BILL now joins other Senators who have shared this honor in past years-Senators TowER and DoLE in 1974 and 1978, respectively, and myself in 1972.

Mr. President, in conclusion, I join the NCOA, its president, Normand M. Gonsauls, and its chairman of the board, "Mack" McKinney, in a salute to our

COlleague, BILL ARMSTRONG, for a, job well done. We hope that BILL will continue to stand tall in this Senate for the men and women of our Armed Forces.

IMMIGRATION AND TERRORISM Mr. THURMOND. Mr. President, my

distinguished colleague from North Carolina recently wrote an important article for Washington Dateline, a syndicated column edited by Robert H. Goldsborough of Westminster, Md. Senator JoHN EAsT points out a frightening aspect of the near collapse of our border security: The millions of foreigners illegally entering our Nation probably include agents of unfriendly governments and dangerous terrorists. This is one more reason why we must promptly act to enforce and reform our immigration laws.

Mr. President, in order to share this excellent column with my colleagues, I ask unanimous consent that this viewpoint appear in the RECORD.

There being no objection the material was ordered to be printed in the RECORD, as follows:

[From the Washington Dateline, Sept. 22, 1981)

IMPORTING TERROR

(By Senator JoHN EAsT)

The name Kristina Berster may not mean much to most Americans today, but there are good reasons why we should bear it in mind. In the summer of 1978 Miss Berster, a native of West Germany, was arrested at the Canadian-U.S. border for attempting to enter the United States on a false passport. Miss Berster, it turned out, was a member of a notorious West German terrorist group, and her phony passport had been stolen from an Iranian consulate in Switzerland during its occupation by anti-Shah demonstrators. Why she was trying to enter the United States, whom she was supposed to meet here, and other natural questions that might occur to citizens concerned with the threats of our internar security have never been answered.

Federal authorities had no trouble apprehending Kristina Berster, although they may have missed some of her colleagues who could also have entered. Miss Berster's false passport. made her stand out like a sore thumb. But what about those who enter the United States without passports, real or phony?

I am re!erring to the 1.5 to 2 m1111on illegal immlgraruts who enter the United States every year a.cco·rding itJo inforillialtdon suppUed by Mtorney Geneml William French Smith. Albout one half of these lllegaJ.s come from Mexico, others from various countries 1n Central America and the Caribbean, a.nd some from northern Africa and the Middle East. Many of the countJrtes from whioh the immigrants hail 'are politiCI!lllly ullS1la.ble With their own indigenous terrorist groups-most of whioh regard the Unilted States as the main source of the world's problems.

No doubt the v~ast majority of immlgrantts, illegal or not, come to the United states for enti,rely innocent reasons-to find work, ElSCSipe persecution, or, less innocently perhaps, to lock themselves into the still munificent welfare system. But there is reason to believe that some immigrants may be the fore-runners of imported terrorism.

According to a UPI stocy published earlier this yea..r, Mexican pollee recently arrested two Mexicans and <two Americans Who were memlbers of a. terrorist group pl&nliling to k!lll U.S. BordeT Patrol agents. This group called itself the "Che Guevara. Commandos" after the notorious Cuban Communist terrorislt who met his death in Bolivia in 1967.

A common theme in. the last ten to flrteen years of terrorism has been an appeal to

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22551 etlmic sepe.reMon 8llld pseudo-mlltionaltsm. A greaJt ma.ny iderutifia'ble ethnic and religious minord.ties in the Western world ha.ve spa.wned one or more groups at this caJtegory; and in Europe, the Bretons e.nd Corsica.ns at F'ra.nce, and the Basques of Spa.ln represenlt simtla.r tendeD.ICies. Obviously not every memJber of these minorities is a terrorist or a. sympathizer W'Lt'h !terrorism, and not a.lll 'tftlese miruorities ha.ve some legitimaJte grteva.ruces tha.t are not to •be ignored simply because of the !terrorist talctJ.cs adopted by a. few.

The un'l'eStrtcted and Ullldh.ecked immigration iruto the Unil.ted States Obviously sets the stage for simUa.r separatist or terrorist movemetllt6 here. And lett us not forget that sU!Ch movemen-ts often recetve the blessdn.g of and active support from Fidel Castro, Ya.sser A'l"81!81t, Col. Qa.ddafe, a.nd the Kremlinthe m.a.1n spoDJSOrs at what has come to be ca.lled' t'he "Terror Interrua.tiona.l." In testimbny 'before the SUJbcommittee on Security and Terrorism of the Senate Judiciary Oom.mitttee, of which I have the honor to be a. member, Mr. Robert Moss, one of the world's foremost authorities on terrorism and ·the subversive tactics at Communism staltes:

Accordllng to reliable Western intelligence sources, Castro boasted tto this assembly of revolutionary leaders of the Western hemisphere in Ju.ly at 1980 that Cuba would not only spread revolution throughout Central America but had developed the cta.p&city to ignite a. race war in the Un.fted States. He described wLth relish the race riots that had shaken Miami, Orlando and other U.S. cities th81t spring, claiming 'that Cuba's network of undercover Qpera.tives in the Un1:ted States W'aS so eJcliensive tlhat "we oa.n make the Mlaani uphea.V'ails look like a. sunshower."

The potentia.l terrorist thre&lt to the United States from immigrants might not be a serious problem if the authorities responsible for checking immig11ant:&-lthe ImmigTIIlltlon and Na.tumllza.tlon Service-<were an adequate agency. Un!fo:rtunately, the INS lms a force at only 9,750 personnel w'ho are responsible for watching the U.S. land border of Mextoo and the arriving planes a.nd dockiD.Ig ships 1ibroughoutt the United States. The U.S. Border PaJtrol is smaller th&n the pollee fo:rces of some large American cities, butt it is responsible for gU81l"d1ng over 6,000 mOes of the Ameri081Il border.

The deluge o! lllegal immigrants into iflhe UD.Iited sta.tes in recent yea.rs has sparked corutroversy over the economic, poLtticaJ, and cultural consequences of the influx. To ignore the rea.l problems arotendant on the wave of re!fugees and immigrants is not hel.pful to anyone-e.nd it could lead to hund!'ecls of KristiD.Ia. Berters penetrart;ing our borders um:leteoted~ntil their bomlbs and bdets anno\llliCe that we have imported terrorism along with our textiles a.nd telev1Sion sets.

REAGAN ADMINISTRATION PROPOSES TO EXPORT ALASKA CRUDE OIL TO JAPAN Mr. MELCHER. Mr. President, today's

Washington Post carries a front page story on the Reagan administration's plans to ask Congress to remov.e the existing prohibitions on the export of Alaska crude oil. According to the story, a White House study group will recommend that the ban be lifted in a report to the Cabinet Council on Energy and Natural Resources next week. I ask unanimous consent that the text of the story appear at the conclusion of my remarks.

Mr. President, I am shocked and disappointed that the administration would seriously consider such a foolhardy pro-

posal. In many respects, congressional adoption of the export prohibition contained in the 1973 Trans-Alaska Pipeline Act represented a compact between representatives of States who wanted a trans-Canadian pipeline and those who favored a trans-Alaska pipeline with tanker movement to U.S. ports and refineries. The Northern Tier and Midwestern States were properly concerned that an Alaskan pipeline would lead to Alaskan crude oil being exported to Japan and the Far East while their regions of the country were experiencing shortages because of Canadian cutbacks and declining produttion. The Reagan administration is now seriously considering a proposal to break this key congressional agreement which led to the adoption of extraordinary expediting legislation to proceed with construction of the transAlaska pipeline.

This is not fair to these States. It also is not in the national interest.

Furthermore oil producers in the Prudhoe field-the oil in question-do not advocate this change. They recognize the advantages of American oU for Americans. The proposal of swaps with Japan is an old saw without any thoughtful American support.

Lifting the prohibition on export of Alaskan oil will increase U.S. dependence on insecure sources of foreign oil. Every barrel exported from Alaska must be replaced with a barrel of imported oil from Libya, Algeria, Nigeria, the Persian Gulf, Venezuela, or Mexico. This endangers our national security. It sends the wrong signals about our resolve to become energy independent to OPEC, to Russia and the rest of the free world. Coming on top of the administration's proposals to scrap our alternative energy and synthetic fuels program and to dismantle the Department of Energy, this proposal signals a full fledged retreat.

Permitting the export of Alaskan oil will seriously cripple the already thin U.S. tanker fleet. The chairmen of the committees which have jurisdiction over merchant marine affairs and the ranking majority and minority members of these committees, have recently written Secretary Watt on this subject. Let me quote from t'heil" letter:

Of the ~proximately 270 vessels comprising the U.S.-fiag tanker fleet, 60 to SOrepresenting 31 percent of our tanker fleet's deadweight tonna.ge-e.re engaged in transporting Alaskan oil to the West Coast a.nd to the Gulf and East coasts through the PaDMna C&nal. The Maritime Adminisrtration esMmates that as many as 50 of these vessels may be &sp·la.ced by foreign-flag ships if Alaskan oU is exported. Owing to the wo:rldiwlde surplus of tankeT tonnage, it is unJUkely tha.t •t'hese d:isplaced vessels wlll find o1Jher business and most, if ruot all, will be taken out of service.

·As a result, the carriers will suffer flnancia.My 81Ild some 3,200 maritime jobs will be lost, not to mention the adverse economic impact on shipbuilding and all other maritime-related irudustries. Moreover, if the owners of the dilspl&~eed vessels de!fault on their ship payments, tthe federal government could be subjected to a. poten·tia.l liability of over $400 mllllon in loan guarantees un.der Title XI of the Mercha.n.t Ma.rirue Act, 1936. The dire consequences of suoh a result for the Administration's efforrts to curb the federal budget 811"8 obvious.

Furthermore, the loss of U.S.-tlag vessels currently engaged in the Alaskan on trade wLll further dimind.sh the OOop8jbilttya.lready dangeroUSly low-of our merolumt ma.rlne to serve in its bdstoric and essentia:l role as a.n adjunct to the military in times of war or national emergerucy.

Mr. President, I ask unanimous conseniti that the full text of the letter appear at the conclusion of my remarks.

Mr. President, ·this week the press is reporting that President Reagan has reached decisions on deployment of the MX missile, the B-1 bomber, and other new and expensive strategic military systems to increase U.S. military capability. I respectfully sugges·t that the proposa;l to export Alaskan oil flies in the face of efforts to increase this country's naJtionaJl security.

First, it increases our dependence on insecure sources of foreign oil.

Second, it would deal a crippling blow to an already overaged and thin merchant marine :fleet that represents a vital military strategic reserve.

Third, it would seriously undermine the economics of new crude oil pipeline systems-the Panama Danai pipeline and the Northern Tier pipeline-designed to enhance the Nation's security by efficiently moving oil from the west coast to the gulf coast and to Northern Tier and to midcontinent refining centers.

Mr. President, I fully intend to oppose any efforts to export Alaskan oil to Japan or anywhere else. I am deeply concerned that this is another instance of fundamental-and, I believe wrong-change in longstanding and proven policies that are being driven by the administration's frantic desire to increase revenue to the Treasury. We must recognize that some things are more important to our national interest than temporarily increasing revenue to the Treasury.

My office has obtained a copy of an administration document on the subject of exporting Alaskan oil. I do not know if this is the latest draft of the White House study group's report or a very early draft. In any event, based upon the story in this morning's Washington Post, the arguments and the figures used are virtually identical, if not identical.

Mr. President, I shall ask unanimous consent that this 10-page document which is entitled "Issue Paper: Alaska~ Crude Oil Exports" be printed in the RECORD at the conclusion of my remarks. I have added my critique to the pe,per at appropriate places which I hope puts more commonsense to their naive illfounded findings. The document SPeaks for itself.

I encourage Members to examine it with care. It proposes that Congress act to export Alaskan oil to Japan. The supposed benefits of this policy are increased profits for the major oil producers on the Alaskan north slope; increased royalty and tax revenues to the State of Alaska; and temporarily increased tax revenues to the United States from the windfall profit tax.

In return, what are the costs? The costs are immense:

The loss of markets for u.s. tankers to foreign carriers;


The loss of U.S. jobs crewing American vessels and maintaining them in American shipyards;

Giving up over one-half million barrels per day of secure Alaskan oil for imported oil in the same volume from insecure foreign sources;

Reducing our national security; and Undercutting investments by U.S.

companies to build needed pipelines and other facilities in this country to move Alaskan oil to areas of need.

Mr. President, I am not prepared to see the country pay these costs. I support a policy of U.S. oil for American consumers. I support a policy that creates and maintains U.S. jobs and generates economic activity for U.S. consumers. I support the present policy of not exporting Alaskan oil.

There being no objection, the material was ordered to be printed in the RECORD, as follows:

ALASKAN CRUDE OIL EXPORTS Shou'ld the U.S. permit exports of Alaskan

crude? Doing so would improve the efficiency of U.S. economy by lowering the cost of transporting Alaskan crude to market. Permitting exports would also increase producers' profits and the tax revenues of the U.S. government and the state of Alaska, while leaving the cost of oil to U.S. consumers unchanged. Some environmental groups and maritime labor unions opposed previous attempts to remove restrictions on the export of Alaskan crude.

MELCHER comment : Congress has overwhelmingly voted against foreign sales or swaps of Alaskan oil so that Americans received and used this domestic oil.

BACKGROUND The exports issue has been a controversial

one for Congress. Several points about this controversy's history are worth noting here, to better understand the political prospects for lifting the ban.

Many early export opponents had sought a trans-Canadian rather than trans-Alaskan route for the pipeline, as a means of making Alaskan oil readily available to midwestern states. When the trans-Alaskan route was set, some Midwestern Congressmen and Senators feared that West Coast refineries would have insufficient capacity to absorb all Alaskan production. They didn't want to build a. pipeline across Alaska only to supply oil to the Japanese. Therefore, despite oil industry protestations that exports were not contemplated, they wrote export limitations into the law as a means of ensuring that Alaskan oil reached American users. Since the pipeline was bull "' many of these individuals have changed their views, and many more have left the Congress. For example, Senator Stevenson supported the trans-Canada route and opposed exports in 1973; in 1979, however, he lead the fight for export approval on the Senate floor.

MELCHER comment: This fight again resulted in overwhelmingly rejecting the proposition of export of Alaskan oil but kept it for U.S. consumers.

Restrictions on Alaskan exports have stiffened over time in two ways. First, Congress has made the Presidential findings that must precede exports harder to establish. Second, Congress has made it easier for Congressional opponents to stop exports even if the President approves them. The Trans-Alaskan Pipeline (TAP) Act permitted exports if (i) the President found that they were in the national interest, and wouldn't reduce the quality and quantity of petroleum available in the U.S., and (11) both Houses failed to disapprove within 60 days. (Under the TAP Act, therefore, one House cannot stop exports 1! the other approves them.) The 1977 Ex-

ports Administration Act (EAA) added more conditions regarding Presidential findings and, more importantly, gave either House the authority to veto exports. The 1979 EAA added still more stringent conditions, and provided that both Houses had to approve eXiports before they could occur. Thus, current law allows either House to stop exports by doing nothing, even if the other approves.

In 1979, the Carter Administration tried to secure permission to approve exports on a limited basis, and was resoundingly defeated. They proposed an EAA provision which would authorize swaps of Alaskan exports for imports from other countries, for Alaskan production in excess of the 1.2 MMB/ D then supplied. This provision was defeated in committee and on the floor of both Houses.

Much has changed since 1979 which might favor lifting the exports ban. The passage of the Windfall Profits Tax means that lifting the ban would favor the U.S. Treasury much more, and the oil companies much less, than was previously the case. In addition, GOP control of the Senate bodes well for allowing exports: many Republican Senators supported exports in 1979, while most Democrats opposed the Administration.

MELCHER comment. The speculation on additional Senate Republican support may be wishful thinking by a White House think tank and assumes a large change in votes.

BENEFITS FROM LIFTING THE BAN Permitting exports would benefit the U.S.

economy by making it more efficient. Currently, West Coast refineries cannot handle all Alaskan production, so more than onethird of Alaskan crude oil is shipped from Valdez to ports on the Gulf of Mexico. The oil moves on U.S. fiag tankers, at a cost of around $5 per barrel, because the Jones Act requires that U.S. ships carry cargoes between U.S. ports. If exports were permitted this oil would be shipped to Japan, or other Far East nations. Transportation on this route would cost around 60 cents/ barrel on the world tanker market, and nearly $3/ barrel if American tankers were guaranteed the Valdez-to-Far East trade. As a result of these reduced transportation costs, wellhead prices would rise roughly $2 to $4 per barrel.1 Table 1 displays the effect of this increase in wellhead prices: the profits of Alaskan producers, and the tax revenues of the State and the U.S. Government, would increase as well.

MELCHER comment. The above contemplates the reduction in the use of American tankers, loss of jobs for American seamen, and thus loss of American maritime income. That is not desirable, and is only consistent with the misguided basis of this paper which is American aid for foreign consumers.

The size of the profit and revenue effects shown in Table 1 depends on two factors. First, how much Alaskan oil will foreign buyers bid away from U.S. consumers? We estimate that they will displace only the 594 MB/D presently shipped to the Gulf of Mexico, and that they will not reduce the amount of crude currently shipped to the U.S. West Coast and Ha.wan.2

MELCHER comment. The "small amount" of price increase would be greatly increased with any supply disruption.

1 Wellhead prices equal the quality-adjusted world price in a given market, less the cost of shipping crude to that market. Therefore, wellhead prices will increase if transportation costs go down.

2 Alaskan producers currently market their crude at a price very near the world price, on the U.S. West Coast. Consequently, lifting the ban will increase the West Coast price by a small amount, if it increases this price at all. Therefore, we expect that West Coast refiners will not cut back their con-: sumption of Alaskan crude, if exports are permitted.

Second, will U.S. flag tankers be guaranteed any or all of the Alaska-to-Far East trade? Table 1 shows the implications of a U.S. fiag monopoly, at one extreme, and of no special status for U.S. ships, at the other. TABLE 1. Increases in annual tax revenues

and profits if exports are permitted (Means of shipment to Japan)

[In Inillions)

Increases in:

World market U.S. fiag tankers tankers

Alaskan State revenues _____ $267 $102 U.S. revenues______________ 520 197 Producer profits___________ 30 11

MELCHER comment. This table assumes stable supplies from foreign sources and ignores any possib111ty of world supply disruptions. It is a scenario of making the u.s. more dependent on imported oll-a backward step.

Lifting the exports ban might provide another economic benefit, by encouraging further exploration and production in Alaska. A considerable incentive for such production already exists, since the Windfall Profits Tax applies only to the Sadlerochit reservoir currently in production, and will not apply to oil coining from other areas. Lifting the ban will strengthen this incentive. Not only will new production earnings be taxed less severely; these earnings ought to be considerably higher, as export-induced transportation savings drive up the wellhead price.

MELCHER comment. The North Slope oilproducing, companies have never, and do not now, advocate the foreign sales or swaps of their on.

Quite apart from the economic advantages summarized above, lifting the exports ban will bring two distinct political benefits. First, allowing exports will improve relations with Japan. Second, exports will improve the trade balance between the U.S. and Japan. Of course, exports from Alaska will be replaced by imports from foreign sources. Nevertheless, the appearance of a more favorable trading relationship might prove useful in fending off protectionist pressures directed at Japan.

MELCHER comment. Gobbledegook. COSTS OF PERMITTING EXPORTS

Lifting the exports ban will directly affect the U.S. shipping industry, and the prospects for West-to-East pipelines. In addition, some observers perceive energy security risks in allowing exports. This section describes eXiports' likely impact in each area. COSTS OF EXPORTS I: THE EFFECT OF LIFTING THE

BAN ON U.S. TANKERS Discussions with Maritime Administration

officials suggest that permitting exports wlH affect the 66 or so ships currently engaged in the Alaskan trade, and that different categories of tankers will be differently affected. The following section will describe these effects for large, small, and mid-sized U.S. fiag tankers. First, however, we provide some background information about the U.S. tanker industry as a whole.

We noted above that the U.S. maritime industry enjoys a legal monopoly on shipments between American ports. In addition, the U.S. government provides subsidies to some U.S. fiag tankers, to permit them to operate on the world market, despite cheaper foreign-flag competition. (Some subsidies cover the difference between U.S. and world market construction costs; others cover the difference between U.S. and world market operating costs.) Normally, the government does not permit subsidized vessels to operate on domestic routes . However, unsubsidized tanker capac! ty has not been sufficient to

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22553 meet the demands of the U.S. Pacific trade, so the Maritime Administration has granted six-month waivers to ship owners willing to pay back their government subsidies in order to participate in the Valdez-West Coast and Valdez-Panama trade.

Large tankers.-These ships (100,000 DWT and up) are currently employed only in the Valdez-West Coast and Valdez-Panama legs of the Alaskan trade. If the ban is lifted, and if u.s. flag ships are not guaranteed some shipments to Japan, excess capacity will be available for the Valdez-West Coast route. (After a transition period, producers will no longer ship oil to Panama.) Some of this excess capactty could leave the West Coast trade. Two ships operating on six-month waivers could return to the international trade; two others which bought back their subsidies to participate in the domestic market could also do so. In addition, this situation will probably cause lower tanker rates to U.S. West Coast ports, as tankers displaced from the Valdez-Panama run compete for West Coast business.

It is not clear that any large U.S. flag tankers will be put out of business by losing the Valdez-Panama trade. Our calculations suggest that such tankers currently charge shipping rates more than two times as large as their operating costs, not counting return to capital. Thus, even if Valdez-West Coast rates dropped dramatically, operators might find continued operation in the protected U.S. tanker market to be preferable to incurring the costs of laying up (i.e., storing) their ships, or of scrapping them altogether. • Similarly, government subsidies could make operation on the world market a feasible alterative for some large tankers. Of course, all of these alternatives involve sharply reduced profits, even if every large tanker remains in operation.

Medium and Small Tankers.-Lifting the ban will displace twenty-one small tankers which currently shuttle crude from the Paciftc coast of Panama to refineries on the U.S. Gulf Coast. However, small product tankers are currently in demand, and small crude tankers might be converted to find alternative employment in the product trades. Many small crude tankers are around twenty years old, however, and capital costs are probably paid off consequently, owners may choose to replace this tonnage with new product carriers which are more suited to the growing demand for product tankers.

Lifting the ban wlll almost certainly put nine mid-sized tankers out of business. The mid-sized tankers are generally suited to the Alaska trade. Nine of these ten tankers currently shuttle crude through the Panama Canal to Gulf Coast ports. Alternative uses for them are limited. The draft of the midsized tankers prohibits their entry into shallow Eastern and Gulf Coast harbors, so they cannot be absorbed by the product trade. An operating differential subsidy is available to offset the difference between the cost of mid-sized U.S. fiag tankers and that of foreign tankers on the world market. However, our calculations suggest that these ships' operating costs per barrel per day are roughly twice that of large tankers. Thus, these ships wlll be at a competitive disadvantage relative to other u.s. flag vessels-and at an extreme competitive disadvantage relative to foreign tlag ships-on the international market. Unless the government chooses to compensate for their marked inefficiency, therefore, these ships will cease operation, and their 26 man crews wlll have to seek other employment. COSTS OF EXPORTS II: THE EFFECT OF LIFTING

THE BAN: WEST TO EAST PIPELINES If exports are permitted, It seems unlikely

•operation elsewhere in the protected u.s. tanker market is not a feasible alternative: the draft of these ships makes It Impossible for them to enter most Eastern and Gulf Coast ports.

that the private sector will choose to finance any of the currently proposed West-to-East pipelines. In fact, the prospect that the ban might someday be lifted has probably deterred investors from moving more quickly in this area. The only pipeline project that has left the drawing boards, In fact, Is the Panama pipe, on which construction is scheduled to begin this summer, and which will commence service late In 1982. Lifting the export ban will probably kill this pipeline. Although its backers promise a $1 per barrel reduction In the cost of shipping to the U.S. Gulf and therefore a $1 higher wellhead price, shipping Alaskan crude to Japan would increase the wellhead price much more. Thus, allowing exports wlll render the pipeline infeasible, even if U.S. tlag ships obtain a monopoly on the trade.

Labor unions recognize the threat that exports pose to potential jobs in pipeline construction. Therefore, additional opposition Is likely to come from this quarter.

MELCHER comment. The need for stable crude supply for Northern tier and Midwest states will be met by the proposed Northern tier pipeline which has cleared permitting approval by the federal government and 4 out of 5 states It would cross. This pipeline will be privately financed and deliver Alaskan and other domestic oil and foreign oil to refineries in a dozen states. COSTS OF EXPORTS IU: THE EFFECT OF LIFTING

THE BAN ON ENERGY SECURITY The energy security argument for main

taining a ban on exports of Alaskan crude oil can be simply stated: it ensures that some 1.5 MMB/D of U.S. demand will be met by supplies from a secure and stable source.

MELCHER comment. This 1s still valid-the over-riding issue.

We believe this benefit is more lllusory than real. Alaska Is clearly secure and stable, but the fact that Alaskan oil can be sold to Japan as well as the U.S. wlll not hurt the U.S. During a disruption, oil prices will be bid up more or less evenly all over the world. In such a situation, the amount of supply available with a ban wlll be little different from the amount available without a ban. If the U.S. wishes to hedge against unfavorable outcomes during a disruption, moreover, it can require contingency provisions in a.ll sales contracts with Japanese purchasers.

MELCHER comment. Pressures to continue the sales contracts to Japan or other country would put a bind on any needed disruptions, no matter how serious U.S. needs.

Maintaining the ban does affect energy security indirectly, through Its impact on Alaska's incentive to place state royalty oil in the Strategic Petroleum Reserve. Permitting exports would reduce Alaska's interest in SPR storage proposals.

MELCHER comment. Is this an afterthought? The authors of the paper should have done as Casey Stengel use to say, "They should have stood In bed."

[From the Washington Post, Sept. 30, 19811 LIFTING OF BAN ON ALASKA OIL

EXPORTS FAVORED (By Thomas W. Lippman and John M. Berry)

A White House study group wm recommend that President Reagan seek congressional authorization to lift the ban on exporting Alaskan crude oil, government and Industry sources said yesterday.

A draft of the group's report says removal of the ban could increase federal revenues from oil industry taxes by $520 million a year. Alaska could get an added $267 m1llion annually, and the producers could reap additional profits of up to $30 million.

The study group, headed by Danny Boggs of the White House Office of Policy Development, is expected to submit its proposal to the Cabinet Council on Energy and Natural Resources within a week.

The report w111 say that removal of the

export ban would permit the oil to be sold for higher prices abroad, increase profits by reducing transportation costs, and improve relations with Japan, the prospective purchaser of the oil. The prospect of increased profits would encourage further· oil exploration in Alaska, the draft says.

Reports that the recommendation is about to be submitted have stirred opposition in Congress and in the maritime industry. Ship operators and unions are strenuously opposed to the idea because, as long as the oil is llmited to domestic purchase, the Jones Act of 1920 requires that it be carried in U.S.-registered vessels, but if exported it could be carried in foreign-tla.g ships.

Rep. Stewart B. McKinney (R.-Conn.), a leader of congressional opposition to the export plan, wrote to President Reagan last week to remind him that Congress has refused to permit the export of Alaskan crude twice, and would surely do so again. Under the Export Administration Act of 1979, both houses of Congress must approve any Alaskan oil exports.

Boggs said that "there is no finalized White House report" on the oil-export proposal because "it has to be reviewed by the Cabinet," but he did not deny that the study group had concluded the ban should be lifted.

The report deals only with oil from the Prudhoe Bay field on Alaska's North Slope. This oil is carried south through the TransAlaska pipeline to a tanker terminal at Valdez. The pipeline carries about 1.5 million barrels a day, about 18 percent of U.S. domestic production. About one-third of that would be available for export.

The draft of the Boggs group's report, obtained by The Washington Post, says that if exports were opened to unrestricted tanker traffic instead of limited to higher-cost u.s.tlag tankers, transportation costs would be reduced from $5 to as little as 60 cents per barrel.

The increase in profits and tax revenues would be about one-third as great, the report says, if U.S.-ftag vessels were used for the exported crude.

The report dismisses as "more lllusory than real" the argument of export opponents that exports should continue to be prohibited for security reasons. If the United States wishes to protect its oil sources in the event of an emergency, it says, it can add a contingency clause to any export contracts with ~apan.

Boggs said the recommendation about exporting Alaskan oil was not linked to any parallel agreement on a replacement source of crude. Industry reports have said that the exported crude would be replaced by imports from Mexico, but Boggs said he has been "telllng everybody for months" that there is no connection between the two proposals.

From the administration's viewpoint, as the preliminary report notes, the export proposal would have two immediate advantages: increasing revenues at a time when the White House is searching for funds to help balance the budget, and improving the U.S. bilateral trade position with Japan.

Not only would it reduce the imbalance in bllateral trade, the report says, but tt would be a useful bargaining chip in negotiations with the Japanese over export limitations.

The on companies have not been pressing for the right to export the oil, because all of the oll being produced on the North Slope by E!:xon and Arco is utmzed in their refineries. Standard 011 Co. (Ohio), the largest producer, sells a large part of its output to other refiners.

Lifting the export ban likely would k111 two remaining proposed West-to-East crude oil pipeline projects, one in Panama and the other the northern-tier project from Washington state to the upper Midwest.

22554 CONGRESSIONAL RECORD-SENATE September 30, 1981 CONGRESS OF THE UNITED STATES,

Washington, D.C., September 10, 1981. Hon. JAMES G. WATT, The Secretary of Interior, Washington, D.C.

DEAR MR. SECRETARY: It is our understanding that the Cabinet Council on Natural Resources and En)vlronment is considering the export of Alaskan oil. Allowing such exports wlll have serious adverse consequences for the United States merchant marine and an undesirable impact on our national security, international relations and, possibly, the federal budget. Accordingly, we urge you and the entire Cabinet Council to give this matter the most careful consideration.

Of the approximately 270 vessels comprising the U.S.-tlag tanker fleet, 60 to so--representing 31 percent of our tanker fleet's deadweight tonnage-are engaged in transporting Alaskan oil to the West Coast and to the Gulf and East Coasts through the Panama Canal. The Maritime Administration estimates that as many as 50 of these vessels ma.y be displaced by foreign-flag ships if Alaskan oil is exported. Owing to the worldwide surplus of tanker tonnage, it is unlikely that these displaced vessels wlll find other business and most, if not all, wlll be taken out of service.

As a result, the carriers wlll suffer financially and some 3,200 martime jobs wlll be lost, not to mention the adverse economic impact on shipbuilding and all other marltime-related industries. Moreover, if the owners of the displaced vessels default on their ship payments, the federal government could be subjected to a potential 11ab111ty of over $400 m1111on in loan guarantees under Title XI of the Merchant Marine Act, 1936. The dire consequences of such a result for the Administration's efforts to curb the federal budget are o~lous.

In addition, the feaslb111ty of exporting Alaskan oil to Japan in exchange for Mexican oil is highly suspect since we have no assurance that Mexico wlll be wllling or able to increase its exports to the United States. Furthermore, the loss of U.S.-tlag vessels currently engaged in the Alaskan oil trade wlll further diminish the capab111ty-already dangerously low-of our merchant marine to serve in its historic and essential role as an adjunct to the military in times of war or national emergency.

Finally, public support for the exploration of necessary alternative energy sources and plans such as the strategic oil reserve wlll be undermined if the American people perceive, and correctly so, that the United States is depleting domestic oil resources at the expense of increasing foreign imports.

The maritime issues involved in the Cabinets Council's deliberatiors are serious and far-reaching; they deserve careful consideration. Your attention to this matter is greatly appreciated.

Sincerely, Committee on Merchant Marine and Fish

eries: WALTER B. JONES,

Chairman. MARIO BIAGGI,

Vice Chairman. GENE SNYDER,

Ranking Minority Member. Committee on Commerce, Science, and

Transportation: BOB PACKWOOD,

Chairman. HOWARD W. CANNON,

Ranking Minority Member. DANIEL K. INOUYE,

Ranking Minority Member, Merchant Marine Subcommittee.

TALKING STRAIGHT ABOUT PRISONS

Mr. BUMPERS. Mr. President, I ask unanimous consent that an article from yesterday's Washington Post by James Q. Wilson entitled "Talking Straight About Prisons" be printed in the RECORD.


TALKING STRAIGHT ABoUT PRISONS (By James Q. Wilson)

The recommendation of the Attorne.y General's Task Force on Vlolen t crime (of which I was a member)- that federal aid be supplied to the sta.tes to assi&t in building correctiona.l facilities-merely restates what countless governors, judges, and correctional omctaJs have long said: our prison system suffers from neglect, overcrowding and inadequacy.

Nonetheless, arguments are raised against this or any other proposal to inoreaee pr'ison capacity. The "decarcera.tion" movement is not as strong as Lt once was, but many liberal groups still call for a moratorium on p-rison construction. And many conservatives, despite their professed concern for law and order, regularly oppose higher spending on corrections. President Reagan, in his speech on crime yesterday, did not mention the task force's recommendations on prisons.

Few persons, and certainly not I, argue that prison is the only suitable disposition for convlcted offenders. We are today witnessing a good dea.l of imaginative and constructive experimenta.tion with other ways of handling the less serious, nonviolent offender-community service, victim restitution, intensive probation, supported work, and the like. But prison is the appropriate disposition for a large number of offenders. To understand why prison capacity must be increased to accommodate the staggering growth in prison populations, it is first necessary to dispose of certain misleading arguments against that increase.

( 1) "There are too many in prison who don't need to be there."

If by "need" you mean that prison should be reserved for persons who are uncontrollable, so pathologically unstable that they wm be an immediate, violent menace to others if released, then the statement is partially true. But prison serves many purposes beyond confining the bloodthirsty-it deters would-be offenders, it incapacitates known offenders, it assures the innocent that justlce is done and it averts private vengeance. Moreover, one should not suppose that Judges today send to prison many persons convicted of minor offenses. In 1960 murderers, assaulters and robbers made up one-third of the prison population; by 19'74, they made up nearly hal!. Only 1 percent of the prisoners are there for sex offenses other than forcible rape, only 5 or 6 percent for drug possession or marijuana tramcking.

(2) "Better prisons only coddle criminals." Society has the right to deprive a con

victed offender of his liberty; it does not have the right to deprive him of the elements of human decency by exposing him to brutality, homosexual rape or riotous cellmates. And ,if arguments of justice and humanity do not move you, consider the practical problem: many judges will not sentence even serious offenders to prisons they regard as inhumane, and thus such criminals are put back on the street. In 1980, 19 states were operating prisons under court orders and another dozen faced serious court challenges.

(3) "The United States already sentences to prison a higher proportion of its population than any other Western nation."

Strictly speaking, this is true, but what of it? It is analogous to saying we have a higher proportion of our population in hospitals or schools or otfices than any other nation. The cotrect question is: what proportion of convicted offenders is imprisoned? When Kenneth I. Wolpin at Yale compared the United States and England, he discovered that a much smaller proportion of convicted offenders was imprisoned here than in England-for every offense. The United States has more people in prison chiefly because it has more crime.

(4) "Prisons make matters worse because they are schools for crime."

I know of no systematic evidence for this fam111ar assertion. As far as we can tell from the many studies comparing offenders, prison neither rehab111tates nor deb111tates-that is, on the average, the crimes committed by persons after leaving prison or after leaving a rehab111tation program are about the same as they were before they entered. It may well be that there are some offenders who commit more crimes after having gone to prison and some who commit fewer, but we have few studies that examine these fine distinctions. And one study-of serious juvenile offenders in Cook County, IlLdiscovered that the young men sent to institutions (i.e., reformatories) had lower offense rates after release than similar offenders who were given less restrictive treatment in the community.

( 5) "By the time new prisons are bullt, the crime rate wm have fallen because of the aging of the population."

Predicting how many crimes will be committed in the future is at least as risky as predicting how many babies wm be born or what the inflation rate wm be. It is true that during the 1980s, young males-the principal source of criminals-will account for a smaller fraction of the population than during the 1970s. By 1990, males age 14 to 24 wm make up less than 8 percent of the population; they accounted for about 10 percent in both 1970 and 1980. Between now and 1991, the number of 18-year-olds will decline by about 1 mllllon, or about 25 percent.

But for several reasons we cannot infer from this pooulation change a corresponding change in prison population. First, the rate at which young males commit crime may continue to rise, making up for the drop in their absolute numbers. Second, increases in the efficiency and severity of the criminal justice system mav lead to a larger proportion of offenders' being convicted and sent to prison and lengthening of the average prison term. Third, the peak age at which persons are sent to prison is older than the peak age at which they commit crimes, for the simple reason that judges ordinarily do not send offenders to prison unless they have acquired a significant prior record. usually a.s a.n adult.

Alfred Blumstein and his colleagues at Carnegie-Mellon University estimate that without any changes in conviction rates or sentence length, prison populations in Pennsylvania will not peak until 1990, and even then the decline in prison population will be slow throu~hout the remainder of the century.

(6) "If we build more prisons, judges wlll just fill them up."

This argument is either false or meaningless, deoending on what you think it implies. Taken literally-that all prisons wUl be ftllecl regardless of capacity-it is clearly untrue. Between 1960 and 1970, when the crime rate roughly tripled, prison population in the United States declined. Even during the period 1971-75, after most state prison populations had started to rise sharply, there were 15 states in which prison population fell .

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22555 Even today, there 1s hardly any statistical correlation between state prisons capacity (which 1s a slippery concept at best) and growtlh in prison population.

What ·the argument really means, I suspect, is not that prison capacity determines prison population, but that having more prisons is bad because persons who should not be sent to prison will be sent once we remove the concern many Judges rightly have: that certain prisons are inhumane. Put more bluntly, persons favoring a moratorium on prison construction have a stake in there being plenty of overcrowded, inhumane prisons so as to discr-edit the very concept of prison by suggesting that prison is necessarily inlh.umane. What poses as a statistical argument-"you'll never catch up"-is in fact a philosophical argument-"prlson is bad." And that brings us back to the first argument.

We need more prison capacity, not because that capacity will lead automatically to certain results, but because it wm allow us to make choices we cannot now make without brutalizing people. Moreover, there are things we can do in addition to bullding fac111ties to increase capacity. Some prisoners are serving sentences far longer than can be justified by considerations of crime prevention or simple justice. If we shorten very long terms by, say, 10 percent, the prisoner serving that term wm hardly notice (and thus we lose little in terms of deterrence or incapacitation) but the gains to the system in terms of lessened overcrowding may be significant.

It 1s .tfme to speak dispassionately and constructively about how best to manage our prison population and to abandon the simplistic arguments that only confuse what should be a serious discussion.

VINCE CARDINALE Mr. MATHIAS. Mr. President, most

communities have one person that sets the mark for service to his or her fellow citizens. In the case of Dundalk, Md., that person is Vince Cardinale.

For the past 19 years, Mr. Cardinale has delivered the mail in Dundalk. He is a veteran, a family man, and a member of the Order of the Sons of Italy. Through this organization, Vince Cardinale has made many contributions to his community by raising funds for children with birth defects. The victims of the recent earthquake in Italy also have reason to be grateful for his humanitarian eft'orts.

Mr. Cardinale is also active in other civic organizations, veterans' groups, and community projects. Dundalk is fortunate to number Vince Cardinale among its citizens.

Mr. President, I ask unanimous consent that an article from the Dundalk Eagle highlighting Mr. Cardinale's contributions to his fellow citizens b-e printed in the RECORD.

There being no objection, the article was ordered to be printed in the REcoRD, as follows: VINCE CARDIN ALE DELIVERS THE MESSAGE TO

DUNDALK BY MAIL AND CHARITABLE WORK

(By Paul Rosenberger) If you live near Dundalk Ave., or Dundalk

Shopping Center, then chances are you know Vince Cardinale, Sr. As a letter carrier in this area for the last 19 years, Vince has carried millions of pieces of mail to surround-

ing homes in all kinds of weather and performed a vital function for his neighbors.

"You get kind of acclimated to it," he said. "It's not so bad as it sounds, and carrying a mail sack every day keeps you in pretty good shape."

Vince started working for the post omce directly after World War II. A recipient of four bronze stars and a purple heart, he was in every major Pacific campaign, starting with Pearl Harbor.

"I had survived in Little Italy until I was 16, and then I enlisted in the Army," Vince said.

An alumnus of St. Michael's School, Vince went from the relatively sheltered world of the Franciscan Brothers who taught him to almost immediate military action. On December 7, 1941, he watched history pass overhead in the form of Japanese planes which strafed the Hawallan Harbor.

"There wasn't much I could be but scared at the time," he said. But later, Vince proved himself time and again until he wa.s promoted to Sergeant First Class.

"The way things worked, I didn't get home until a.fter the Battle for the Phlllipines," he said.

Returning home, he was given preference as a decorated veteran, and began work for another federal authority-The Postal Service. Nineteen years ago, he transferred to Dundalk after making his home in Eastfield, and has grown more accustomed to the area and its people with each passing season.

Eleven years ago, Vince and his family moved to t heir present Dunmanway home, .and he became more involved with the Order of t he Sons of Italy.

Since joining t he group, Vince has been awarded several times for his campaigns to raise money for the disadvantaged, most notably for children with birth defects.

"It's not just me, or the Dundalk Lodge," he said, "It's a national project."

Although Vince is not completely responsible for much of the monies raised, he 1s involved enough to have been appointed Statewide General Chairman for the project.

"We raised about $21 ,000 for the Maryland campaign this year, and I'm projecting we wlll raise another $60,000 in the next two years," he said. Since its inception, the Sons of Italy have raised two and a half million dollars to fight birth defects.

"That not the only thing he's involved in, " said Vince's 14-year-old son, Gino. He's started a couple of new Lodges and worked with other projects, too."

"Gino's my favorite fan," Vince sa.ld. "I feel !unny blowing my own horn, so I let him do it for me."

Gino had plenty to say about his father, noting that Vince played a large part in the Maryland committee which raised over $100,000 for the Italian Earthquake Fund. But for a man whose family's origins began in the ·small town of Abruzzi, Italy, the disaster was easier to try and cope with th<an ignore.

Vince also helped organize the National Convention of the Sons of Italy held in Baltimore in 1979, winning one of many certificates of appreciation for his efforts.

Just two weeks ago, Vince a.nd his wife , the faNner Pat Dombrowski, traveled to New Orleans to attend the Diamond Jubilee convention of the Order. A national delegate, Vince keeps Maryland members and Dundalk Lodge No. 2236 abreast of any new policies or dLrectives from the National Committee.

Another duty is the National Membership and Expansion Committee, and Vince has, as his son Gino noted, started new Sons of Italy Lodges in the Baltimore metropolitan area, with another lodge planned.

"The 'Sons of Italy are the largest ethnic O'l'ganization in the U.S., and we're on the

move," Vince said. He seems determined to keep the group moving by encouraging new members to join.

"It isn't only for adults. We've got youth lodges, too", he said. As a case in point, the Anthony Cardinale Lodge, started by Vdnce and named for his father, is youth oriented.

Although very obviously involved with the Order of the Sons of Italy, Vince has other interests, yet he collects more unsolicited merit awards and certificates of appreciation from the group and the charities he has helped through the years. A three-time past president of the Dundalk Lodge, Vince was elected as Sons of Italy Man of the Year for 1975, has been Distinguished Venerable of the group, and members of his group look to him for guidance whenever a new project comes up.

"I really do have other interests," he said, "but sometimes it's hard to make time for them."

Because he gets up at 4:30a.m. for his job, he admits that meeting nights can be a bit of a strain, especially during certain times of the year, as in the case of the Heritage Fair.

"We came up with the fried dough idea for the Fair when it first started and our booth has become one of the most popular," Vince said. "I just don't get home much during that weekend."

Other groups which Vince belongs to include American Legion Post No. 38, the Northwood Post of the VFW, the Knights of Columbus, and the Edgemere Moose Lodge, but Sons of Italy activities sometimes preclude his participation in other groups. Yet he works hard at his career and is now in a training program for Postal Supervisors.

A civic minded man who admits he does not want t o overstep federal rules limiting postal employees from taking part in politics, he still feels strongly about some Dundalk areas issues.

Topmost in his mind is the suggestion of building new fac111tles, including a possible lee rink and swimming pool, at Merritt Point Beach.

"I disagree with that idea," he said. "Or at least the way it is presented. Why should the taxpayers have to pay for those fac111ties when only a limited number of people will be using it? The money would probably be better spent on some security down there, which could be financed through permits to local organizations who want to use the park. An 80-ycar-old person who goes to Merritt Point doesn't want an ice rink, they want a little security, and to know they don't have to be afraid of a small group of troublemakers.

"I'm an advocate of youth and the aged, and I think tax money could be used more wisely for them directly," he said.

Vince has proved his point many times over when talking about the young and the old, by working with the March of Dimes, and the U.S. Marines' Toys for Tots campaigns.

"You just have to get involved," he said, "and there are plenty of people in Dundalk of Italian descent who could really help the Sons of Italy. I should know how many there are, I see their names on letters every day."

To make it easier for prospective members, Vince mentioned anyone can find out more about the Order by calling him at 284-7686.

Even with all his activities, he is still a man with strong family ties, which include eight children and step-children.

"Let's see if I can get this right. O.K., there's Pamela, Richard, Vince, Jr., Judy, James, Bruce, John, and Gino," he said. "It's hard to keep it all straight."

Whether he can remember all of his own accomplishments or not, Vince's works are remembered by his family, his fellow Lodge members, and friends, not to mention Gino.


ROUTINE MORNING BUSINESS The following routine morning busi

ness was transacted today:

MESSAGE FROM THE HOUSE At 5:49 p.m., e. message from the

House of Representatives, delivered by Mr. Gregory, one of its reading clerks, announced that the House has passed the following joint resolutions, without amendment:

S.J. Res. 78. Joint resolution to provide for the designation of October 2, 1981, as "American Enterprise Day";

S.J. Res. 98. Joint resolution to authorize and request the President to issue a. proclamation aesigna.tilng October 16, 1981, as "World F'ood Day"; and

S.J. Res. 103. Joint resolution to authorize and request the President of the United States to issue a. proclamation designating the seven calendar days beginning October t. 1981, as "National Port Week".

The message also announced that the House has passed the following bill, with amendments, in which it requests the concurrence of the Senate:

S. 1211. An act to extend the Toxic Substances Control Act !or 1 year.

The message further announced that the House has passed the following bill, in which it requests the concurrence of the Senate:

H.R. 4048. An act granting the consent of Congress to the agreement between the States of Kansas and Missouri establishing their mutual boundary in the vicinity of the French Bottoms near Saint Joseph, Mo., and Elwood, Kans.

ENROLLED BILLS AND J'OINT RJ!:SOL'OTIONS SIGNED

The message also announced that the Speaker has signed the following enrolled bills and joint resolutions:

S. 1033. An act granting :the consent of Congress to the agreement between the States of North Carolina. and South Carolina establishing their lateral seaward boundary;

S. 1475. An act to extend the expiration date of section 252 of the Energy Policy and Conservation Act;

H.R. 4084. An act to improve the operation of the Marine Mammal Protection Act of 1972, and for other purposes;

H.J. Res. 263. Joint resolution to designate May 6, 1982, as "National Recognition Day for Nurses"·

H.J. Res.' 265. Joint resolution to provide for a. temporary increase tn the publlc debt limit; and

H.J. Res. 266. Joint resolution to provide for a temporary increase in the public debt Umit.

The enrolled bills and joint resolutions were subsequently signed by the President pro tempore (Mr. THURMOND) .

At 10:59 p.m., a message from the House of Representatives, delivered by Mr. Gregory, a:nnoJI:nceq that the H.o.use has agreed to the report of t~ tlcfJmmittee of conference on the disagreeing votes of the two Houses on the amendments of the Senate to the joint resolution (H.J. Res. 325) making continUing appropriations for the fiscal year 1982 and for other purposes; and that th~ House recedes from its disagreement to

the amendments of the Senate numbered 16, 31, 36, 43, 44, and 46, and has agreed thereto, each with an amendment.

HOUSE BILL HELD AT DESK The following bill was ordered held at

the desk by unanimous consent until the close of business on October 1, 1981:

H.R. 4048. An act granting the consent of Congress to the agreement between the States of Kansas and Missouri establishing their mutual boundary in the vicinity of the French Bottoms near Saint Joseph, Mo., and Elwood, Kans.

ENROLLED BILLS PRESENTED

The Secretary reported that on today, September 30, 1981, he had presented to the President of the United States the following enrolled bills:

s. 1033. An act granting the consent of Congress to the agreement between the States of North Carolina and South CaroUna establishing their lateral seaward boundary; and

S. 1475. An act to extend the expiration date of section 252 of the Energy Policy and Conservation Act.

REPORTS OF COMMliTI'EES

The following reports of committees were submitted:

By Mr. PERCY, from the Committee on Forelgn Relations, with a.m.endments:

S.J. Res. 100. Joint resolution to authorize the pa.rtic:l.pa.tion of the Unilted States in a mult1Il81tional force and observers to im<paement the trealty of peace between Egypt a.ntl Israel (Rept. No. 97-197) .

By Mr. GARN, from the Committee on Banking, Housing, and Urban Aft'a.irs:

Report entitled. "Second Monetary Polley Report for 1981 from the Committee on Banking, Housing, and Urban A1fa.1rs" (Rept. No. 97-198).

EXECUTIVE REPORTS OF COMMI'ri'EES

The following executive reports of committees were submitted:

By Mr. McCLURE, from the Committee on Energy and Na.tura.l Resources:

Henry E. Thomas, IV, of Virginla, to be an As61stant Secretary of EneTU (International A1fairs).

<The above nomination was reported from the Committee on Energy and Natural Resources with the recommendation that it be confinned, subject to the nominees' commitment to respond to requests to appear and testify before any duly constituted committee of the Senate.)

By Mr. STAPFORD, from the Commitltee on Environment and Puibllc Works:

Lee M. Thomas, of South carolina, to be an Associate Director of the Federal Emergency Management Agency.

By Mr. THURMOND, from the Comm!Jttee on the Judiciary:

John Ernest Lamp, of Washington, to be U.S. Attorney for the Eastern District of Washington for the term of 4 years;

Emery R. Jordan, of Ma.in.e, to be U.S. Ma.raha1 for the D1strlct of Maine;

J. Raymond Bell, of the District of COlumbia, to be Chairman of the Foreign Claims Settlement Commission of the United States for the term expiring September 30, 1982;

Cameron M. Batjer, of Nevada, to be a. Commissioner of the U.S. Parole Commission for a term of 6 years;

Glen H. Davidson, of Mississippi, to be U.S. Attorney !or the Northern District of Mississippi for the term of 4 years; and

George Landon Phillips, of Mississippi, to be U.S. Attorney for the Southern District of Mississippi !or the term of 4 years.

INTRODUCTION OF BILLS AND JOINT RESOL~ONS

The following bills and joint resolutions were introduced, read the first and second time by unanimous consent, and referred as indicated:

By Mr. STEVENS (by request): S. 1682. A bill to allow vessels in the for

eign trade receiving subsidy to transport cargo between the Island of Unalaska, Alaska and .the contiguous United States during a voyage in the foreign trade; to the Committee on Commerce, Science, and Transportation.

By Mr. FORD (for himself and Mr. BUMPERS);

S. 1683. A bill to provide for a. 2-year Federal budget cycle, to provide !or the inclusion of additional matters in the Federal budget, to strengthen congressional authorization, budget, and appropriations procedures, to strengthen congressional oversight of Federal programs, and for other purposes; by unanimous consent, ordered held at the desk until the close of business Tuesday, October 6, 1981.

By Mr. RIEGLE: S. 1684. A bill to amend the Internal Rev

enue Code of 1954 to clarify the definition of geothermal energy, and !or other purposes; to the Committee on Finance.

By Mr. CHILES: S. 1685. A bill to amend the Bank Holding

Act of 1956 with respect to interstate trust operations; to the Committee on Banking, Housing, and Urban Affairs.

By Mr. LUGAR: s. 1686. A bill to amend the Federal Reserve

Act to provide that deposits of State and local governments wm not be subject to reserve requirements, and for other purposes; to the Committee on Banking, Housing, and Urban Affairs.

By Mr. BAKER (for himself and Mr. PRESSLER):

s. 1687. A b111 to make a technical amendment to the International Investment Survey Act of 1976; considered and passed.

S.J. Res. 111. Joint Resolution consenting to an extension and renewal of the interstate compact to conserve oil and gas; to the Committee on Energy and Natural Resources.

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Mr. STEVENS (by request>: ~· · 1~82. A bill ~o. allow v~ssels in the

foreign trade rece1vmg fiUbstdY to transport cargo between the Island of Unalaska Alaska and the contiguous United States' during a voyage in the foreign trade; to the Committee on Commerce, Science, and Transportation. TRANSPORTATION OF CARGO IN FOREIGN TRADE

BETWEEN UNALASKA, ALASKA AND THE CON

TIGUOUS UNITED STATES

Mr. STEVENS. Mr. President, at the


request of the Aleut Corp. of the Aleutian Island region of Alaska, I offer the following amendment to the Merchant Marine Act of 1936:

This amendment would allow vessels constructed in U.S. shipyards that are presently limited to foreign commerce into a portion of the Alaskan trade.

Hawaii and the U.S. Island Territories have enjoyed a similar exemption from the Merchant Marine Act since its enactment in 1936. This amendment adds Dutch Harbor, Alaska to the list of noncontiguous "domestic" ports that permit U.S. vessels built with construction differential subsidy to stop in Alaska en route to the Orient.

American President Lines <APL) has joined the Aleut Corp. in this request APL and the Aleut Corp. have signed a trade agreement that is contingent upon this proposal. The trade agreement will substantially impact cost, availability e.nd speed of ocean service to the remote Aleutian region of Alaska.

Transportation issues within the 48 States are generally confined to the relative merits of several available modeswater, rail, road, or air. Alaska spans 2,500 miles within four time zones and 33,000 miles of coastline, and most of the State is limited to air or water access.

We are wholly dependent upon ocean service for even the most basic necessities, and any proposal that directly affects our ocean lifeline receives careful scrutiny.

While I have offered this proposal today without prejudice the issues raised by such a request are fundamental, and I feel that they deserve ~ fpll he~ring on the merits. The Commerce Committee has, at my request, scheduled hearings on this amendment for October 16.

Mr. President, I ask lJ.n~nimous consent that the bill be pnnted in the RECORD.

There being no objection, the bill was ordered to be printed in the REcoRD, as follows:

s. 1682 Be it enacted by the Senate anct Hcruse of

Representatives of the United States of America in Congress assembled, The Merchant Marine Act, 1936, as amended ( 46 U.S.C. § 1101 et seq.) is amended as follows:

(1) Section 506 (46 u.s.c. § 1156) is amended by inserting after the word "Ha.wa11" the following: ",the island o! Unalaska in the State of Alaska" .

(2) Section 605(a) (46 U.S.C. § 1175(a.)) is amended by inserting after the word "Hawaii" the following: ", the island of Unalaska in the State of Alaska.".

By Mr. RIEGLE: S. 1684. A bill to amend the Internal

Revenue qode. ot 1954 to clarify the definition •.of geotherin8J energy, and for other PU11>0Ses; to the Committee on Finance.

DEFINITION OF GEOTHERMAL ENERGY

e Mr. RIEGLE. Mr. President, I am introducing legislation to correct a serious inequity in the ClllTent administration of

the geothermal tax credit program. The ms stipuilated, by regulation, that geothermal tax credits shall not be available unless the temperature of the ground water exceeds 50° C. This definition effectively excludes most of the country, and most homeowners from taking advantage of the credit by installing groundwater heating and cooling systems.

We currently have the technology, in the form of heat pumps, to exploit this resource. Homeowners in my own State of Michigan, Ohio, and other States have begun to recognize the potentiaJ. of this heating source, and have installed these systems. In fact, 40 States have identified areas of this type of geothermal potential, and some States have instituted their own tax credit program. The ms, however, remains adament that groundwater temperatures must be as least 122° F in order to qualify for the Federal credit:

This resource is not being expanded as rapidly as we would hope due to the ffiS definition. A homeowner may install a solar collector and qualify for a Federal credit, while a groundwater /heat pump system which utilizes water that has been indirectly heated by the Sun, cannot receive any Federal tax credit. This is, in my view, unfair, and not consistent with the intent of the Energy Tax Act of 1978.

The heat pump systems have a much higher efficiency than fossil systems. This efficiency allows a homeowner to pay for the cost of the system in less than 5 years, and can produce major savings in fuel use on a nationwide basis. I have not encountered any scientific evidence to substantiate the IRS limitation of 50° C, and feel that the elimination of this arbitrary limitation will induce many people to convert their present systems to a geothermal/heat pump arrangement.

This legislation is similar to that introduced in the House by Congressman HALL of Ohio. Its cost is estimated to be $10 million annually. This is a small price to pay for the energy savings that could be obtained from geothermal sources, and for removing the inequity that the IRS has created with its definition.

Mr. President, I ask unanimous consent that the text of the bill be printed in the RECORD.

There being no objection, the bill was ordered to be printed in the RECORD, as follows:

s. 1684

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Geothermal Energy Amendments of 1981".

CLARIFICATION OF DEFINITION OF GEOTHERMAL ENERGY

SEC. 2. (a.) GENERAL RULE.-Paragraph (3) of section 613(e) of the Internal Revenue Code of 1954 (defining geothermal deposit) is amended to read as follows:

"(3) GEOTHERMAL ENERGY DEFINED.-For purposes of paragraph ( 1) , the term 'geo-

thermal energy' means the natural heat of the earth (at any temperature) which is stored in rocks, an aqueous liquid or vapor (whether or not under pressure) , or any other medium. A geothermal well shall in no case be treated as a gas well for purposes of this section or section 613A, and this section shall not apply to any geothermal property which is located outside the United States or its possessions."

(b) CLARIFICATION OF APPLICATION OF BUSINESS CREDIT AND RESIDENTIAL CREDIT TO GEOTHERMAL PROPERTY.-

(1) Subparagraph (D) of section 44C(c) (7) of such Code is amended by adding at the end thereof the following: "In the case of a. system which uses both geothermal energy and a.n energy source not eligible !or the credit under this section, all of the equipment comprising the system shall be eligible !or the credit if, on a British thermal unit basis, geothermal energy provides more than 80 percent the energy in a typical year for which the system 1s designed. If less than 80 percent of the energy is supplied by geothermal energy, the credit shall apply to those portions of the system which produce, distribute, or use energy which is more than 50 percent supplied by geothermal energy (on an annual British thermal unit basis)."

(2) Paragraph (3) of section 48(1) of such Code is amended by adding at the end thereof the following new subparagraph:

"(D) APPLICATION OF CREDIT TO EQUIPMENT WHICH USES BOTH GEOTHERMAL ENERGY AND ANOTHER ENERGY SOURCE.-In the case Of a system which uses both geothermal energy and an energy source not eligible for the credit under this section , all of the equipment comprising the system shall be eligible for the credit if, on a British thermal unit basis, geothermal energy provides more than 80 percent of the energy in a typical year for which the system is designed. If less than 80 percent of the energy is supplied by geothermal energy, the credit shall apply to those portions ot the system which produce, distribute, or use energy which is more than 50 percent supplied by geothermal energy (on an annual British thermal unit basis) ."

(C) CONFORMING AMENDMENTS.-(!) Clause (U) of section 44C(c) (2) (B) of

such Code is amended by striking out "any geothermal deposit" and substituting "geothermal energy".

(2) Clause (i) of section 44C(c) (5) (A) of such Code is amended by striking out "energy derived from the geothermal deposits" and substituting "geothermal energy".

(3) Clause (viti) o! sect~on 48(1) (3) (A) of such Code is amended bY' striking out "energy derived from a geothermal deposit" and substituting "geothermal energy".

(4) Clause (11) of section 57(a) (11) (D) of such Code is amended to read as follows:

" ( 11) all geothermal properties." (5) Subsection (c) of section 263 of such

Code is amended by striking out "any geothermal deoosit" and substituting "geothermal energy".

(6) Subt>ara.graph (E) of section 465(c) ( 1 ) of such Code 1s amended by striking out "geothermal deposits" and substituting "geothermal energy".

(7) Paragraph (1) of section 613(c) of such Code is amended by striking out "geothermal deposit" and substituting "geothermal well".

(8) Subsection (e) of section 613 of such Code is amended-

(A) by striking out "deposits" each place it appears in paragraph ( 1) and substituting "properties", and

(B) by striking out "Deposits" in the subsection heading and substituting "Properties".

22558 CONGRESSIONAL RECORD-SENATE . September 30, 1981 (9) Subsection (b) o! section 614 ot such

Code is -amended-( A) by striking out "geothermal deposits"

in the text and substdtuting "geothermal wells", and

(B) by striking out "Geothermal Deposits" in the subsection heading and substituting "Geothermal Wells".

(10) Paragraph (1) o! section 614(c) ot such Code is amended by striking out "oil and gas wells and geothermal deposdts" each place it appears and substituting "oil, gas, and geothermal wells".e

By Mr. LUGAR: S. 1686. A bill to amend the Federal

Reserve Act to provide that deposits of State and local governments will not be subject to reserve requirements, and for other purposes; to the Committee on Banking, Housing, and Urban Affairs. lU!:SERVE REQl7IREMENTS RELATING TO STATZ

AND LOCAL GOVERNM:miT DEPOSITS

• Mr. LUGAR. Mr. President, I am today introducing a bill designed to assist States and localities raise additional revenues by easing restrictions on the management of their cash assets.

State and local governments are feeling the effects of our current national economic plight with special severity. They are accepting their share of the budget cuts enacted by Congress. They are impacted by inflation and dwindling revenues. And, they have been especially hard hit in their ability to raise capital funds in the tax-exempt bond market.

It seems to me that under these circumstances, we should be supportive of efforts which assist States and localities to raise additional revenues or realize savings in their cost of doing business. Earlier this year, Senator PaoXMIRE and I joined our Banking Committee chairman, Senator GARN, in introducing S. 1427, a bill to help State and localities lower interest costs on the revenue bonds they sell for capital improvements by broadening competition for the underwriting of these securities. The revenue bond bill's time has come. It offers significant interest rate savings to State and local revenue bond issuers without cost to the Federal Government.

The bill I am introducing today falls into this same category. It offers the potential of significant additional revenues to States and localities without cost to the Federal Government.

Mr. President, the background of this issue begins with the 95th Congress extending to the Federal Government the ability to deposit Treasury tax and loan account funds in depository institutions on demand at interest rates slightly below the average Federal funds rate. This ability to earn higher interest rates on potentially significant amounts of public funds is not available currently to accounts of State and local governments. My bill would allow State and local governments to take advantage of opportunities to earn the greatest return possible on their idle cash.

State and local governments will have a greater incentive to improve upon existing cash management practices because there will be additional opportuni-

ties in placing deposits in financial institutions. While some State and local governments currently invest surplus funds in the Treasury repurchase market and in short-term Treasury bills, these markets are not always available, especially to smaller units of government. Some units of government with relatively small amounts of funds to invest do not enter these markets because of the paperwork involved or the lack of required minimum balances. This bill would allow State and local governments to deposit surplus funds in financial institutions and to earn interest at rates slightly below the Federal funds rate.

My bill also contains two additional provisions, the first of which conforms the NOW account provisions of the 1980 Deregulation and Monetary Control Act to the Federal Reserve Act provision by which we authorize banks to pay higher interest rates on Federal, State, and local demand accounts.

The second provision corrects the NOW account law to make clear that Congress intends States and localities to be eligible to establish NOW accounts.

Presently, only special purpose governmental units can maintain NOW accounts in banks if the funds are in the name of or used by schools, colleges, universities, libraries, hospitals, or other medical facilities. The Federal Home Loan Bank Board <FHLBB> recently proposed a ruling that would have allowed savings and loans to offer NOW accounts to general purpose State and local government units. However, the American Bankers Association successfully challenged the ruling and obtained a permanent injunction prohibiting State and local participation in NOW accounts.

Mr. President, I am hopeful that the Senate will support this measure which will help State and local governments earn the higher rates of return on their idle cash than might currently be available, especially to smaller and medium size governments which lack the ability to carry on sophisticated investment programs of their own.

I am pleased to report that the legislation has the support of the Municipal Finance omcers Association and the National League of Cities. I anticipate that the banking community will embrace it as well.

Mr. President, I ask that a supportive resolution adopted by the Municipal Finance omcers Association and a brief technical statement outlining the intended impact of benefits of the bill be printed in the RECORD.

There being no objection, the resolution and statement were ordered to be printed in the RECORD, as follows:

SUPPORTIVE RESOL"DTTON

(Concept: To give units ot State and local government the same access to deposit-taking financial institutions presently enjoyed by the Federal Government.)

The federal government is <a;ble to deposit tunds in financial institutions (commercial banks, savings banks, savings and loan associations, building and loe.n associations,

homestead associations including cooperative banks and credit unions) on demand at interest rates sUghtly below the average Federal Funds rate in Treasury Tax and Loan note accounts. These depooits are not subject to reserve requirements. To the extent not insured by the FDIC or a comparable agency, these deposits must be secured by U.S. Government, Government Agency or municipal securities or suitable loan paper.

In contrast, state and local government demand deposits are subject to reserve requirements and cannot earn a rate higher than the rate paid on NOW accounts.

It federal laws and banking regulations are amended to permit state and local government to have the same access to financial institutions now enjoyed by the federal government, the following wlll occur:

(1) State and local government wlll have a greater incentive to improve upon existing cash management practices because there wm be greater income potential for cash balances on hand for periods under 14 days. State and local governments presently have access to the Treasury repurchase market and to short term Treasury Bllls for periods ot one to 14 days. These markets are not always available, especially to smaller units of government. Some units ot government with relatively small amounts ot tunds to inv~st do not enter these markets because of the paperwork involved.

(2) State and local government as issuers of debt will benefit to the extent that financial institutions use municipal obligations to secure these demand deposits. One would expect that each state would require that bonds pledged to secure public deposits. One would expect that each state would require that bonds pledged to secure public deposits !rom that state would be obligations ot that state or its instrumentalities.

(3) Some states will likely accept a pool ot home mortgages from within the state as collateral tor public deposits placed in financial institutions which do not need tax exempt income !rom state and local government debt obligations.

(4) Financial institutions wlll benefit by their ab111ty to attract short term funds at rates slightly below the federal tunds rate. Obviously, any financial institution which now has large amounts ot state and local deposits on demand will be worse off.

POLICY STATEMENT-INTEREST EARNINGS OF STATE AND LOCAL GOVERNMENT DEPOSITS

The Municipal Finance Officers Association is aware ot the ab111ty ot the federal government to deposit Treasury tax and loan account funds in depository institutions on demand at interest rates slightly below the average Federal Funds rate. This ab111ty to earn higher interest rates on potentially significant amounts of public funds is not currently available to accounts of state and local governments. MFOA !eels that state and local governments should be able to take advantage of opportunities to earn the greatest return possible on their investments, particularly in light of infiation, taxpayer resistance to increasing taxes, increasing demands for services and the prospective decline in federal grant funds. Providing for the payment on state and local government tax and loan accounts is a further step toward removing the governmentally imposed restrictions on the payment of interest on various types of accounts at financial institutions.

The Municipal Finance OMcers Association hereby supports changing federal statutes to allow state and local governments to enjoy the same access to financial institutions as

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22559 the federal government to the earning potential of surplus funds.

Adopted: June 17, 1981.e

By Mr. McCLURE (for himself and Mr. JACKSON) :

S.J. Res. 111. Joint resolution consenting to an extension and renewal of the interstate compact to conserve oil and gas; to the COmmittee on Energy and Natural Resources.

INTEBSTATE COMPACt' TO CONSERVE OIL AND GAS

• Mr. M~URE. Mr. President, today I am introducing with the cosponsorship of Senator JACKSON a joint resolution which gives the consent of Congress to the extension and renewal of the interstate compact to conserve oil and gas.

The interstate compact to conserve oil and gas was originated by six member States and consented to by the congress in 1935. Its membership has now grown to include 30 oil and gas producing States and 6 associate member States. These are:

Member states: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Florida, Dlinois, Indiana, Kansas, Kentucky, Louisiana, Maryland, Michigan, Mississippi, Montana, Nebraska, Nevada, New Mexico, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, SOuth Dakota, Tennessee, Texas, Utah, West Virginia, and Wyoming.

Associate States: Georgia, Idaho, North Carolina, Oregon, South Carolina., and Washington.

When the compact was originally ratified, major oilfield discoveries and the subsequent glut of oil and gas supplies had resulted in substantial loss of oil at the surface, in wholesale flaring of gas, and in oil prices as low as 10 cents a barrel. As a result, there was contamination of the topsoil and contamination of underground water supplies. The oil producing states immediately concerned agreed on the need for some cooperative effort to deal with these problems.

The purpose of the compact is "to conserve oil and gas by the prevention of physical waste thereof from any cause." <Article II.)

The compact expressly states that: It is not the purpose of this compact to

authorize the States joining herein to limit the production of oil or gas for the purpose of stab111zing or fixing the price thereof, or create or perpetuate monopoly, or to promote regimentation, but 1s limited to the purpose of conserving oil and gas and preventing the avoidable waste thereof within reasonable limitations. (Article V.)

The compact binds each signatory State to enact laws to accomplish certain specified types of oil or gas waste prevention. It also binds them to enact measures to deny access to commerce of oU produced in violation of its valid conservation statutes, and to provide stringent penalties for waste of oil or gas. Since most States already had enacted such measures prior to entering the compact, the key substantive provision was that establishing an Interstate Oil Com-

pact Commission composed of one member from each signatory State. Its duty was:

To make inquiry and ascertain from time to time such methods, practices, circumstances, and conditions as may be disclosed fOil' bringing about conservation and the prevention of physical waste of on and gas, and at such intervals M said Commission deems beneficial it shall report its findings and recommendations to the several States for adoption or rejection.

Congress has consented to extensions of the compact at approximately 2-year intervals from 1935 to 1976. The most recent congress·ional consent expired on December 31, 1978.

Thus, the compact has been without the congressionaJ. consent required by article 1, section 10, clause 3 of the Constitution for over 32 months.

Because of the need for speedy consideration of this joint resolution, Senator JACKSON and I did not seek additional cosponsors prior to introduction, but would invite and welcome any of our distinguished colleagues from affected States or otherwise to add their names as cosponsors at their earliest convenience.•

ADDITIONAL COSPONSORS s. 351

At the request of Mr. WALLOP, the Senator from South Carolina <Mr. HoLLINGS) was added as a cosponsor of S. 351, a bill to amend the Federal Mine Safety and Health Amendments Act of 1977 to provide that the provisions of such act shall not apply to the surface mining of stone, clay, and sand work.

s. 872

At the request of Mr. PELL, the Senator from South Carolina <Mr. HoLLINGS), and the Senator from Ohio <Mr. GLENN) were added as cosponsors of S. 672, a bill to require the Secretary of Transportation to administer a national driver register to assist State driver licensing officials in electronically exchanging information regarding the motor vehicle driving records of certain individuals.

s. 1348

At the request of Mr. SASSER, the Senator from Michigan <Mr. LEVIN) was added as a cosponsor of S. 1348, a bill to amend the Internal Revenue Code of 1954 to clarify certain requirements which apply to mortgage subsidy bonds.

s. 1427

At the request of Mr. GARN, the Senator from Alabama <Mr. HEFLIN) was added as a cosponsor of S. 1427, a bill to reduce financing cost to cities, counties, and States by amending section 5136 of the revised statutes to permit national banks to underwrite and deal in revenue bonds issued by State and local governments, and for other purposes.

s. 1831

At the request of Mr. SPECTER, the Senator from Louisiana <Mr. JoHNSTON) was added as a cosponsor of S. 1631, a bill to establish a Presidential Commis-

sion on the Bicentennial of the U.S. Constitution.

SENATE JOINT R'ESOLUTION 97

At the request Of Mr. MITCHELL, the SenaJtor from Massachusetts <Mr. TsoNGAs) , the Senator from Utah <Mr. HATCH), and ·the Sena;'tor from West Virginia (Mr. ROBERT C. BYRD) were added as cosponsors of SenaJte Joint Res~lution 97, a joinlt resolution to designa;te the second full week in Oc·tober as "Nationa.l Legal Secretaries' Court Observance Week".

AMENDMENT NO. S51

At the request of Mr. PROXMIRE, the Senator from West Virginia <Mr. RANDOLPH) , the Senator from Tennessee <Mr. SASSER), and ·the Senator from Virginia (Mr. HARRY F. BYRD, JR.) were added as cosponsors of amendment No. 551 .proposed 'to S. 1196, an original bill to amend the Foreign Assistance Act of 1961 and the A:rms Export Control Act to authorize appropriations for development and security assistance programs for fiscal year 1982, to authorize appropriations for the Peace Corps for the fiscal year 1982, to provide authorities for the Overseas Private Investment Corporation, and for other purposes.

AMENDMENT NO. 581

At th'e requestt of Mr. MITCHELL, the Senator from Arka;nsas (Mr. BUMPERS), the Senator from Massa.chuset'ts <Mr. TsoNGAS) , the SenSJtor from Rhode Island <Mr. PELL), and the Senator from Michigan <Mr. RIEGLE) were added as cosponsors of amendment No. 561 proposed .to S. 1196, an original bill to amend the Foreign Assistance Act of 1961 and the Arms Exportt Control Act to authorize appropriations for development and security assis·tance programs for fiscal year 1982, to authorize appropriations for the Peace Corps for the fiscal year 1982, to provide author-ities for the Overseas Private Investment Corporation. and for other purposes.

AMENDMENTS SUBMITTED FOR PRINTING

INTERNATIONAL DEVELOPMENT AND SECURITY ASSISTANCE ACT OP 1981

AMENDMENT NO. 571

<Ordered to be printed.) Mr. ZORINSKY proposed an amend

ment to the bill <S. 1196) to amend the Foreign Assistance Act of 1961 and the Arms Export Control Act to authorize appropriations for development and security assistance programs for the fiscal year 1982, to autharize appropriations for the Peace Corps for the fiscal year 1982, to provide authorities for the Overseas Private Investment Corporation, and for other purposes.

AMENDMENT NO. 572

<Ordered to be printed.) Mr. ZORINSKY proposed an amend

ment to amendment No. 571 to the bill S. 1196, supra.


AUTHORITY FOR COMMI'ITEES TO MEET

COMMrrn:E ON ENVmONMENT AND Pti'BLIC WORKS

Mr. BAKER. Mr. President, I ask unanimous consent that the Environment and Public Works Committee be authorized to meet at 9: 30 a.m. on Thursday, October 1, to hold a full-committee markup on S. 1024, the Federal Aid Highway Improvement Act of 1981.

The PRESIDING OFFICER. Without objection, it is so ordered. ·

COMMlTl'EE ON ·FOREIGN aEI.ATIONS

Mr. BAKER. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Thursday, October 1, to hold hearings on the A WACS and F-15 enhancement arms sale package to Saudi Arabia.


Mr. BAKER. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Monday, October 5, at 2 p.m., to hold hearings on the A WACS and F-15 enhancement arms sale package to Saudi Arabia.


Mr. BAKER. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Tuesday, October 6, at 2 p.m., to hold hearings on the AWACS and F-15 enhancement arms sale package to Saudi Arabia.


Mr. BAKER. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Wednesday, October 7, at 2 p.m. to hold a business meeting to consider the AWACS package and other committee business.


SELECT COMM:rrn:E ON INTELLIGENCE

Mr. BAKER. Mr. President, I ask unanimous consent that the Select Committee on Intelligence be permitted to meet on Thursday, October 1, at 9 a.m., to receive briefings on intelltgence matters.

The PRESIDING OFFICER. Without objection, it is so ordered. SUBCOMMITrEE ON LEGISLATION AND RIGHTS OP

AMERICANS

Mr. BAKER. Mr. President, I ask unanimous consent that the Subcommittee on Legislation and Rights of Americans of the Select Committee on Intelligence be authorized to meet during the session of the Senate at 10 a.m. on Thursday, October 1, to discuss intelligence matters.

The PRESIDING OFFICER. Without obJection, it is so ordered.

ADDITIONAL STATEMENTS

GUNSMOKE 1981 e Mr. ARMSTRONG. Mr. President, it is with great pride and pleasure that I inform the Senate that the top guns in the U.S. Air Force can be found in the 140th Tactical Fighter Wing of Colorado Air National Guard, based at Buckley Field in Aurora.

Earlier this month, the Air Force conducted a worldwide fighter gunnery meet at Nellis Air Force Base in Nevada. Units from U.S. tactical air forces from all over the world, and from Air Guard and Air Reserve units all across the country participated in the grueling weeklong competition, known as Gunsmoke 1981.

Gunsmoke 81 was, in a sense, the world series for Air Force attack pilots and the ground crews who maintain their aircraft. Pilots were tested in their abilities to bomb, strafe, and navigate, and ground crews were tested on their ability to keep their pilots in the air. The 12 four-aircraft teams which participated in the finals at Nellis had been selected after stiff regional competition.

When the smoke had cleared at the end of the grueling week, the team from the 140th Tactical Fighter Wing at Buckley led by Lt. Col. Wayne Shultz had won the overall competition, and Shultz had won the individual Top Gun Award. In addition, Capt. Larry Sitting won the low-angle bombing competition.

Colorado is very proud of Lieutenant Colonel Shultz, Captain Sitting, and the other flying members of the winning team-Maj. Joseph Thomas, Capt. Charles Betts, and Capt. Larry Sadler, and of the flight crews who were so indispensable in obtaining this victory. Their triumph was a triumph not for them only, but for the Colorado Air National Guard and the airplanes they flew-the Vought A-7D-as well. I salute them all.e

AGRICULTURAL EXPORTS TO THE EUROPEAN COMMUNITY

e Mr. COCHRAN. Mr. President, I call to the attention of my colleagues efforts by Secretary of Agriculture John Block to warn of new protectionist efforts being discussed in the Common Market that could restrict U.S. soybean exports to the European community.

Under an existing agreement, the United States has free access for its soybeans into the Common Market. We have successfully defended that right over the years, and it now appears that we will have to do so again.

The European Community Commission seems· to be considering a proposal for imposing an internal tax on vegetable and marine fats and oils. This new proposal is being raised in the context of the enlargement of the Common Market to include Spain.

Secretary Block, in meetings with officials from the European community, has referred specifically to this proposal and warned that the United States will defend our industry from such a tax. This

would apply to oil produced from U.S. soybeans and thus would be a violation of our zero duty binding.

In New York, the Secretary reiterated that position to an international audience, explaining that "any actions such as this would lead to immediate U.S. counteraction."

I commend the Secretary on his strong stand on this issue and urge the administration to continue its efforts to assure unrestricted access of vegetable and marine fats and oil products into the Common Market.

lOW AN FOR FEMA • Mr. JEPSEN. Mr. President, I offer for inclusion in the RECORD an article that appeared in the Sioux City, Iowa, Journal on July 28, 1981. The article in question is an editorial which deals with the appointment of one of my constituents to the position of regional director of the Federal Emergency Management Agency in the Kansas City Federal Regional Center. In that, I take obvious pride.

More importantly, the editorial deals with this newspaper's perception of the Reagan administration as viewed through this appointee, Patrick J. Breheny. It comments on his lack of bureaucratic philosophy, honed as an aide on the Hill for former Iowa Congressmen Gross and Cherie. It comments on his philosophy of tough management and the fact that most bureaus of the Federal Government could use that kind of talent.

Of greatest significance, it favorablY comments on this administration's intent to reverse the order of march from Federal control to local and State direction, a keystone in this administration's philosophy. I believe this editorial comment by a major newspaper in my State tells me that this administration and the work of the Congress have the support of the people of this country.

The article follows: IOWAN FOR FEMA

An Iowan heads a relatively new regional federal agency created to deal with natural and man-made ddsasters. His goal is to tighten up the organization and get it back to where state and local people can handle it, reversing the order of march which usually saw the federal government responding first .

Patrick J. Breheny of Clear Lake, director of public affairs for Iowa Construction services and fonner &llde for 10 years to Iowa Congressmen H. R. Gross and William Scherle, ha.s been named director of Region VII of FEMA, an acronym for Federal Einergency Management Agency with headquarters in Kansas City.

FEMA, created during the administration of President Carter, is the single point of contact within the federal government for the admtntstrat1on of emergency management. It is responsible for recovery from natural disasters such as floods, bUzzards and tornadoes and from man-made calamities such as fires and nuclear accidents.

Several weeks ago, FEMA had two people in Iowa to aid in making a flood damage estimate. Breheny said, "We're not overpromising. Just because we are helping the

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22561 state assess the damage does not mean federal aid will be forthcoming. I! we !eel the damage meets critel"lia Congress has set, then we will move in and decla.re it a disaster area. A bridge may have gone down, but did it go down because o! the storm, or was it teetering anyway?"

That type of comment does not exactly fit the bureaucratic mold. But it's an indlcatdon of Breheny's philosophy which was honed in a decade of association with two o! Iowa's most conservative congressmen, Gross and Scherle.

As director of Region VII, Breheny oversees operations in Kansas, Missouri and Nebraska, as well as Iowa. His Kansas City of!ice has 57 employees and he report& to Louis 0. Giuggrtda, national director or FEMA.

The outspoken Iowan argues with a contention that there might be only 30 minutes advance warning or a nuclear attack !rom the Soviet Union. He said two weeks would be a more realistic ftgur('>. That 1s because the Russians would have to move their population to shelter In !ear of reprisal and that movement would be detected by the United States' monitoring system. His agency would have charge or any mass relocation or people.

Another llttle-known !unction o! FEMA is response to terrorism. Said he, "I'm not on the Hlll Street squad. My job 1s to back up the FBI by moving people out o! the area. Terrorism is a growing .concern In this administration. We are working on plans."

Breheny has a reputation !or tough management. Most o! the bureaus o! the federal government could use that talent.e

CAMPAIGN AGAINST DRUG AND ALCOHOL USERS

• Mr. HUMPHREY. Mr. President, as chainnan of the Senate Subcommittee on Alcoholism and Drug Abuse, I applaud the efforts that have produced the "Get High on Yourself" campaign against alcohol and drug abuse.

Drug and alcohol abuse is widespread among our young people. In the past two decades, the drug problem exploded. During the sixties and the seventies there were increases that varied betw~n tenfold 'and thil"tyfold in tenns of levels of use by varying segments of the population, particularly adolescents and young adults.

One recent encouraging sign is the significant decrease since 1977 of high school seniors indicating approval of regular marihuana use, and a decrease in the last 2 years of their actual use of marihuana. In spite of this hopeful turnaround, the overall drug problem continues to be very serious.

Although less dramatically, alcohol abuse has also increased since the 1960's. In the 1981 Fourth Special Report to the Congress on Alcohol and Health, the Department of Health and Human Services reported results of a survey which classified 31.2 percent of the adolescent sample as alcohol misusers. One-third of all traffic fatalities are alcohol related, with alcohol abuse especially involved in accidental death and injury among young people.

All too often this abuse of alcohol and drugs results in loss of motivation and fa.m1ly alienation, and interferes with school perfonnance and childhood and adolescent development. The detrtmentiall effects of alcohol abuse on health have been well documented and we are now beginning to accumulate scientific data

on the adverse health effects of longterm exposure to drugs.

We must make use of all of our resources in a cooperative effort between the private and public sectors to counteract the appeal of alcohol and drug abuse. We must warn young people of the dangers of alcohol and drug abuse, and work in our homes, schools, and communities to make them aware of alternative ways to utilize their energies and abilities. We must develop programs to help adolescents resist peer pressure to get high on alcohol and drugs.

The "Get High on Yourself" campaign is a collaborative effort to focus attention on the problem and to change attitudes toward drug and alcohol abuse. I support the aims and goals of this program and sincerely hope that it will be just the beginning of direct efforts by private businesses and concerned individuals to combat the abuse of drugs and alcohol by our young people.•

INTERIOR DEPARTMENT OPPOSES THE DICKEY -LINCOLN PROJECT

• Mr. COHEN. Mr. President, the fate of the proposed Dickey-Lincoln School Lakes hydroelectric project on the St. John River in northern Maine has been debated extensively on the floor of the Senate. As most of my colleagues know, I have been a strong opponent of this illadvised project.

On August 28, 1981, the Army Corps of Engineers ftled the final environmental impact statement <FEIS> on the DickeyLincoln projeQt. Af·ter reviewing the FEIS, on September 28, the Department of the Interior infonned the Council on Environmental Quality of its strong opposition to the project.

Since many of my colleagues have a continuing interest in this matter, I am including the complete text of the Interior Department's letter to the Council on Environmental Quality in the RECORD at this point.

The correspondence follows: U.S. DEPARTMENT OF THE INTERIOR, Washington, D.C., September 28, 1981.

Hon. A. ALAN Hn.L, Chairma.n, Council on Environmental Qual

ity, Executive Office of the President, Washington, D.C.

DEAR MR. HILL: The Department o! the Interior has reviewed the Final Environmental Imp·act Statement (FEIS) !or the U.S. Army Corps o! Engineers' Dickey-Lincoln School Lakes Project, Maine. In our opinion, severe long-term adverse envLronmental impacts wlll occur if this project is implemented as proposed. Project-Induced losses include the large-scale destruction of terrestrial and aquatic resources and the ellm1nation or an important wilderness recreational area. Mitig·atlon or these losses has not been adequately addressed, and those mitigation measu~res proposed are not an integral part o! the project but the subject of a separate authomation. Furthermore, the FEIS does not a.ddress alternatives that would s.llow the development o! the hydroelectric potential o! the St. John River Basin wh1le mainta.lning its unique natural resource and Tecreatlonal values.

It shou~d be noted that Secretary Watt has consistently opposed this project on environmental grounds while holding previous positions in the Federal Government. I also have longstanding fam111arlty with this project and hydropower projects in general because

of my experience with the Bonnevllle Power Adminlst!I'ation a.nd share tihe Secretary's concern.

We h 'ave mainta:ined close coordination with the Corps since 1975. In spite of our extensive efforts, disagreements persist witih the Corps over our longstanding concerns about both the serious environmental effects and the lack of adequate mitigation. Since fi.Ung of the FEIS signifies an intent to proceed with the project as proposed, we believe action ·by ·the Council is a-ppropriate. We have advised the Corps of om- intention to refer this matter to you.

The enclosed statement supports our conclusions. We are prepared to discuss the issues with you at your earllest convenience.

Sln.cerely,

Enclosure.

DoNALD PAUL HODEL, Acting Secretary.

STATEMENT OF THE U.S. DEPARTMENT OJ' THE INTERIOR

(Concerning the Dickey-Lincoln School Lakes Project, Maine-u.s. Army Corps of Engineers) During review of the draft, revised draft,

and supplemental draft EIS's !or this proJect, the Department of the Interior as well as other Federal agencies pointed out an array of deficiencies. On most points the Final Environmental Impact Statement (FEIS) doel not respond satisfactorily to our concerns. One o! the most serious deficiencies is the failure to address adequately mitigation of unavoidable project-induced losses o! fish and wildlife and recreational resources.

A. completion or the project as proposed by the U.S. Army Corps o! Engineers, w111 permanently and adversely alter the aquatic and terrestrial ecosystem o! the St. John River valley. The project will result in:

1. The Inundation of 278 miles o! streams and rivers in the basin, 66 miles or which are along the main stem o! the St. John River.

2. The inundation o! 80,455 acres of terrestrial habitat (excluding waterways, lakes and ponds).

3. Construction o! 386 miles o! transmission llnes through northwestern Maine, northern New Hampshire, and Vermont.

The FEIS filed with the Environmental Protection Agency on August 28, 1981, recognizes most o! the adverse impacts but, in our opinion, underestimates their severity and long-term nature. The Corps concludes that the environmental losses are offset by the economic gains to be derived from hydroelectric generation. We do not agree.

The Corps sta.tes that their proposed mltlgatlon plan would replace 100 percent of the wildlife habitat productivity lost due to project implementation. We do not believe this to be the case as stated in our letters to the Corps on May 13, 1980, and December 29, 1980.

B. The project as proposed appears to be inconsistent with the following environmental requirements and policies.

1. The Fish and Wlldll!e Coordination Act.-The Corps is not proposing adequate mitigation for unavoidable project induced losses. Further, there is no guarantee that any mitigation will ever be accomplished since the Corps is requesting separate authorization for mitigation. We believe the Fish and Wildlife Coordination Act authorizes the Corps to mitigate for project Induced losses.

2. National Environmental Policy Act.Section 102e o! NEPA requires the action agency to study, develop. and describe appropriate alternatives to recommended courses o! action in any prooosal the..t involves unresolved conflicts concerning alternative uses o! available resources. The FEIS ralls to study less damaging alternatives that would allow development of the hydroelec-

22562 CONGRESSIONAL RECORD-SENATE September 30, 1981 trical potential or the St. John Basin wh1le protecting the unique natural resource and recreational values of this .basin.

3. Counc11 on Environmental Quality Guidelines for Interagency Consultation to Avoid or Mitigate Adverse Effects o'n Rivers in the Nationwide Inventory.-The project will perma.neil.tly alter sections of the St. John River, the Big Black River, and the Little Black River listed by the Depa.rtanent of the Interior in July 1981 in the Nationwide Inventory of potential Wild and Scenic Rivers.

C. The Department of the Interior belleves the project, as proposed, is environmentally unsatisfactory as:

1. It would permanently alter the aquatic ecosystem of 278 mi~ of streams and rivers.

2. It would destroy 80,455 acres of terrestrial habitat (excluding waterways, lakes and ponds), and associated wildlife resources.

3. It would eliminate over 1300 acres of wetlands used as breeding habitat by black duck, a species whose population is in decline, and important summer foraging area for moose.

4 . It would destroy 36,893 acres of deer wintering areas affecting 50 percent of the deer within the St. John Region's 684,500 acres. The mitigation proposed by the Corps would compensa.te for less than half of this habitat loss.

5. It would destroy critical riparian habitats which support several unusual plants including the endangered Furbish lousewort.

6. It would permanently alter 55 miles of the St. John River, plus 29 m1les of the Big Black River, plus 27 miles of the Little Black River all of which were listed in July 1981 by the Department of the Interior as meeting the criteria for designation as potential wild and scenic rivers. The St. John River is the largest and longest undeveloped river in the northeast, and the largest river in one of the largest, least accessible and most primitive geographical units east of the Mississippi River. The Big Black and Little Black Rivers are listed as two of the ten least developed rivers within the entire northeast region.

D. The project as proposed wm result in degradation of a nationally significant environmental resource. Project-induced 1066e5 include the large-scale destruction of terrestrial and aquatic resources, and elim1nation of an important w1lderness recreational area.

E. The Fish and Wtldltte Service has worked closely with the Corps of Engineers on the project since 1975. We have recommended against project construction since January 4, 1978. We first advised the Corps of our possible intention to refer this project to the Councn on Environmental Quality in our March 1, 1979, comments on the Revised Dra.ft EIS. We have continually recommended what we feel is adequate mitigation for project-induced losses in the event the proJect ts constructed over our objections. Although we accept some of the mitigation recommendations or the Board of Engineers for Rivers and Harbors, the portions of the proposal that wm cause major long term adverse impa.cts have not been modified or adequately mitigated.

Following are the major steps taken since 1975 by the Department to resolve the issues:

1. Since April 20, 1976, a series of reports has been submitted by the Department of the Interior to the Corps to assist in their planning.

2. The Department of the Interior made extensive comments on the various draft environmental impact statements, revised draft environmental impact statements, and draft supplement environmental impact statements. We have consistently recommended aga.inst project construction. We have continually recommended what we feel is adequate mitigation if the project is constructed over our objections. We have informed the Corps and the Department of Energy of our possible referral intentions in

letters of March 1, 1979, May 13, 1980, and December 11, 1980.

3. Fish and Wildlife Service representatives met with staff of the Boa.rd of Engineers for Rivers and Harbors on June 4, 1980, to discuss fish and w1ldlife mitigation pla.ns and to clarify why we felt tha.t the Corps' proposed mitigation was inadequate. In our comments on the proposed report of the Chief of Engineers on Fish and W1ldlife Mitigation (December 29, 1980), we stated that we agreed with part of the Corps mitigation plan but that we felt that the wildlife mitigation plan was unacceptable. We ma.intained our recommendation that the project not be constructed and reiterated our possible referral intentions.

4. In addition, there have been numerous field level contacts and meetings between Corps of Engineers and Fish and Wildlife Service personnel.

F. The Department of the Interior recommends that CEQ become involved in discussions with us and the Corps with the objective of mediating our differences.

The goals should be to: 1. Have the Corps withdraw its EISon this

project and have the Corps and the Department of Interior, with other agencies as appropriate, work together in developing a plan that preserves the unique natural resource and recreational values of the upper St. John while providing hydroelectric power. Such a solution could be developed by eliminating Dickey Dam and concentrating on low head hydro development.

2 . Have the President recommend amending the project authorization as needed to accomplish the above goals and to provide for appropriate mitigating measures.

U.S. DEPARTMENT OF THE INTERIOR, Washington, D.C., September 28, 1981.

Lt. Gen. J . K . BRATTON, Chief of Engineers, U.S. Army Corps of En

gineers, Washington, D.C. DEAR GENERAL BRATTON: The Department

of the Interior has reviewed the Final Environmental Impact Statement (FEIS) for the U.S. Army Corps of Engineers' Dickey-Lincoln School Lakes Project, Maine. In our opinion, severe long-term adverse environmental impacts wlll occur if this project is implemented as proposed. Project-induced losses include the large-scale destruction of terrestrial and aquatic resources and the elimination of an important wllderness recreational area. Mitigation of these losses has not been adequately addressed, and those mitigation measures proposed are not an integral part of the project but the subject of a separate authorization. Furthermore, the FEIS does not address alternatives that would allow the development of the hydroelectric potential of the St. John River Basin whlle maintaining its unique natural resource and recrea.tiona.l values.

It should be noted that Secretary Watt has consistently opposed this project on environmental grounds while holding previous positions in the Federal Government. I also have longstanding familiarity with this project and hydropower projects in general because of my experience with the Bonnevllle Power Administration and share the Secretary's concern.

The administrative record indicates that our two respective Departments are at an impasse in resolving these confiicts. Therefore, we are referring this matter to the Counc11 on Environmental Quality in accordance with procedures specified in 40 CFR 1504. A copy of our supporting documentation is enclosed. We request that you take no action to implement this proposal until the Council acts upon the referral.

We look forward to working with you in the further planning and analysts of this project.

Sincerely, DoNALD PAt:TL HODEL,

Acting Secretary.e

STATUS OF MACHIAS SEAL ISLAND • Mr. COHEN. Mr. President, on April 29, of this year, the senate ratified the Maritime Boundary Settlement Treaty with Canada. This treaty, which is awaiting approval by the Canadian Parliament, will place the competing claims of the United States and Canada to the Gulf of Maine before a Chamber of the International Court of Justice for final determination.

When this treaty came before the Senate, I spoke in support of it. At the same time, however, I felt it important to note that the treaty will not address a longstanding dispute between the United States and Canada over the status of Machias Seal Island. This island, which is situated 11 nautical miles seaward of Cutler, Maine, is small but carries great significance for the fishermen of Maine.

As I noted in my statement on the Maritime Boundary Treaty, a rich lobster fishery lies just off Machias Seal Island and Maine lobstermen have laid their traps there for generations.

The latest edition of the Commercial Fisheries News, which is published in Stonington, Maine, contains an article which sets forth the background of the Machias Seal Island dispute and its current status. I offer it for inclusion in the REcORD for the information of the Congress and the public. I also take this opportunity to reemphasize the importance of this island to the United States and the State of Maine.

The article follows: MACHIAS SEAL ISLAND BOUNDARY PROBLEMS

WoN'T BE SETTLED (By Jon Lattin)

Canadian and US fishermen have peacefully coexisted, more or less, within the disputed waters around the Machias Seal Island for nearly a cenury. That sttutaion may continue for another 100 years, says a State Department official.

Contrary to popular belief, an agreement ratified by Congress and signed by President Reagan to submit the ocean-border dispute to the binding arbitration of the World Court, wlll not settle the question concerning the llttle island, 11 nautical miles southeast of Culter, ME. According to David Colson, senior attorney at the State Department, if t he Canadians also ratify the agreement, the Court will be asked to decide the boundary from a. point approximately 20 miles seaward of the island and beyond to Georges Bank.

"Politically we weren't in a position to arbitrate the sovereignty of the Island, and neither were the Canadians," says Colson. "The State Department is not going to initiate any activity (concerning Machias Seal Island)."

The Canadian boundary line runs from within the Grand Manan Channel to a point west of Flowers Rock and then to a cordinate 7% miles west of the island. The US line runs 2 miles east of the island. At a point approximately 20 miles seaward, the two lines cross. It is from this point the World Court may someday make a decision, one that wlll have a profound impact on George Bank fishermen .

Unless the state o! Maine or its elected representatives lobby for an official resolution to the Machias Seal Island disoute, the waters in the vicinity of the Canadian outpost wlll remain a no-ma.n's-land for another generation of lobster and scallop fishermen.

The question of the island's sovereignty dates back to the Treaty of Parts signed at the end of the Rf'volutionary War. The


treaty's general language concerning the islands off Nova Scotia. and the US is the basis of the disagreement.

THE BUZZ DISSENTION

The US has apparently always taken the position that Machias Seal Island was its possession. So, when in the mid-1800s Canada queried the US about building a lighthouse on the island to assist navigation into the Bay of Fundy, it caused little concern. Nothing was put into writing. The lighthouse was built ~d has been manned by Canadians to the present time. It wasn't until the 1920s when the diplomatic channels began to buzz with dissention.

Former Department of Marine Resources (DMR) Commissioner Vinal Look, who grew up in Cutler, ME, says he has always considered Machias Seal Island US territory. In the early 1970s while he was chief warden tor the department, he recalls the first of several spats between US and Canadian fishermen.

The CanadiaQ.s, who are restricted by a closed season tor lobsters !rom June to November, began to resent US lobstermen who were fishing the same waters around the island. According to Look, canadian officials told the Maine lobstermen they would have to take their traps out during the Canadian closure. DMR officials advised US fishermen they could continue fishing that area. Maine state boats and aircraft maintained a survelllance around the island for several days to support the lobstermen'a rights to fish where their fathers and grandfathers had fished before them.

Commissioner Ronald Green of DMR contacted the State Department concerning the incident. A protest was relayed to the Canadian government. Canada then backed off, Look recalls.

OTTAWA, TO WASHINGTON, TO MAINE

The next conflict occurred in 1972 when Canadian scallopers were observed In the disputed waters at a time when the fishery was closed to US fishermen. Someone In Maine state government decided to force US laws on the Canadians. "We wanted to let them (Canadians) know we ha.d control of the area," says Look.

The chiet warden flew over the area and spotted the draggers just west of the island. Coastal wardens Roger Allen and Bob Bums pulled their boat alongside to inform the Canadian fishermen the area was closed to scalloping. The Canadians steamecl off without arguing the matter.

But it wasn't long before Ottawa contacted Washington. Word soon came down to Maine to lay off. Peaceful coexistence was becoming the official, unwritten government policy.

Just before the US 200-Mlle limit was signed into law in 1976, the Canadians jumped the gun and extended their boundary line. When the US published its line soon after it left a gap as wide as 20 miles claimed by both countries.

Further conflict was avoided when both governments later informally agreed they would have jurisdiction only over their own boats within the disputed waters. It an American or Canadian fishing vessel strayed over one or the other lines, Coast Guard personnel !rom either country were quick to nab the offenders.

When the Canadian boat Windy Bird strayed within three mlles of Cutler trawling for groundtlsh, it was seized, then released with a warning. Look sa.vs this action may have contributed to the relatively lenient fine levied al!'ainst a Stonlnl!.'ton (ME) lobsterman who was caught bv · Canadians in their waters a few years later.

Marine Patrol Officer Bob Burns says he has received complaints !rom the Canadians when American-owned lobster buoys were spotted over the line. "It doesn't have to be too far over before they say something about it," notes Burns.

SEA IS ALWAYS BOILING

About 25 US fishermen continue to haul their traps near the isla.nd when weather conditions make the 11-mlle trip !rom Cutler or the 26-mlle journey !rom Jonesport feasible. The trip must be made during slack tide as the buoys go under when the tide 1s running in or out.

Calm waters near the coast are usually no indication of the sea conditions near Machias Sea Island. "The water is always bolling out there,'' says BUrns. But that usually doesn't Inhibit either fishermen or bird watchers who travel to the secluded outpost not more than a halt-mile in length.

Some Maine fishermen have supplemented their incomes transporting ornithologists to the island of puftllu; and ospreys. The Canadian lighthouse personnel come out to the launching ramp to assist any attempted landing in the choppy waters.

LITTLE EMPHASIS ON MACHIAS SEAL

"People up there wlll get along fine as long as Ottawa and Washington don't get involved,'' says Colson. "As long as fishermen don't start shooting at each other, both governments w111 probably leave well enough alone.''

But discussions have taken place in Washington to settle the issue once and !or all. Colson recalls a state department suggestion in 1978 to make Machias seal Island 9.Il international bird sanctuary and work out a joint fishing agreement with the Canadians for the surrounding waters. The matter never went beyond the proposal stage.

Look is disappointed that the dispute still remains unsettled. "When !edera.l oftlclals are discussing fisheries problems they tend to forget Machias Seal Island,'' he notes. "They're more concerned with Georges Bank."

Washington, now pressing Its territorial air rights over the waters near Lebanon and Korea, apparently is not about to create a hubbub over a stmteglca.lly unimportant Island and waters offering a livelihood to only 25 Maine fishermen.

"There's just not going to be the emphasis put on it I feel they (Washington) sh()uld,'' says Look with resigna.tton.e

HIGH INTEREST RATES • Mr. BOREN. Mr. President, for several months now, I have taken the floor virtually every day to warn of the economic collapse that seems to me to be inevitably on its way under the pressure of exorbitantly high interest rates.

Earlier this week, for a period of time, that financial Armageddon seemed to be here. The stock markets in Tokyo, London, Zurich, and the United States, as well as most of the rest of the industrialized world, plunged. Fortunately, by the end of the day, the stock market in this country had rallied to an 18.55-point rise in the Dow Jones index, and by this morning, the Tokyo market had also rebounded. The economic news in other capitals was not as good.

This week, the Washingtlon Post, the Wall Street Journal, as well as other financial publications throughout the world, are offering analyses of what happened.

One of the more bizarre explanations is that the doomsday predictions of one economic analyst so shook the industrial world that the bottom fell out of the stock market. While I am not in a position to judge the qualifications or reputation of an analyst such as Mr. Granville, I find it very hard to believe that the words of one man could cause

the world financial community to quake · to its very foundations-not at least if it were in a sound and stable condition.

I find it far easier to accept the analsis that high interest rates in this country in particular was a major factor in the market action. To be sure, the plunge on the British stock exchange had to do with the increase in British interest rates, but even that was tied to high interest rates in the United States.

On September 14, the Thatcher government authorized the Bank of England to raise the effective minimum interest rate on bank borrowing from 12 to 14 percent, to protect the exchange value of the pound. Such action was necessary partly because of the disparity between British interest rates and the then 20-percent prime interest rate in the United States.

I have said before that the adverse effect of high interest rates on domestic economy of the United States is only one component of the problem, albeit a very important component. The economic health of this country is intricately interwoven with the financial fabric of the other Western industrialized nations of this world, and through them, tied to the economy of virtually every nation of the world.

An economic dislocation here is not only felt in Tulsa, Muskogee, and Oklahoma City, but also in Bonn, London, Paris, and Sydney.

I say again, Mr. President, that the cancer of high interest rates must ·be dealt with now, not 2 or 3 months or 2 or 3 years from now, but now. Perhaps the next time the stock markets of the world begin to slice, they will keep on going. Then it will be too late.

Mr. President, I ask that articles of the Washington Post and the Wall street Journal be printed in the RECORD.

The articles follow: [From the Wall Street Journal, september

1981]

"BLUE MONDAY"

Yesterday's stock market jitters bega.n in Tokyo, spread to Hong Kong, swept on to London and ended up In New York. But when all was said and done, it was a great deal less than the world-wide "panic" the ta.blolds were proclaiming in their early editions. London had a late rebound from the spectacular early losses. In New York, the

Dow Jones Industrial Average finished up 18.55 on the day. Joe Granv1lle's efforts to shiSke the world at its foundations had fallen somewhat short of the xn.a.rk.

On the other hand, yesterday's New York rally notwithstanding, the stock markets a.re not exaotly happy places these days, at

least not !or anyone with bullish inclinations. And however much the White House might chllde Wall Street for Its lack of faith,

It doesn't hurt to think seriously once in awhile about why stocks are winning so little Investor favor.

In England, the answer is fairly simple. The burdens of Mrs. Thatcher's economic policies have all fallen on the private sector, which wasn't 1n very good shape to start with. The VAT te.x bite, erratic monetary policy and the dlm prospects !or anv serious

paring of the size of the public sector do not encourage English businessmen to think that their debt-heavy balance sheets are going to markedly Improve soon. The strong showing by left-win!rer Tony Benn at the Labor Party Conference also didn't help, suggesting as tt dld that when and 1! Labor


makes a comeback it will push Britain even further to the left. And finally there is the simple explanation that another boost in interest rates made fixed interest investments more attractive than stocks.

Indeed, simple explanations of market behavior have much to recommend them. Investors 1n both the U.S. and England have no trouble doing their arithmetic. And so long as interest rates stay high, debt will probably look more attractive •than equities. If the stock markets are to recover, it will be necessary for both countri~s to continue to push down inflation and encourage private sector growth.

The Thatcher failures tell us nothing a;bout prospects under the Reagan program, which makes its genuine beginning this week. Mr. Reagan has provided tax relief for the private sector and has made at least some headway against the growth of the public sector.

The markets are nervous ·but the tabloids were premature in describing a panic. What we oa.n lea.rn from the markets is that expectations of an overnight recovery from policies many years in the making were overly optimistic. It will most likely be some time yet before everyone begins to feel comfortaJble with the new regime.

[From the Washington Post, Bept. 29, 1981] STOCK PRICES FALL IN MAJOR MARKETS

THROUGHOUT WORLD (By Leonard Downie Jr.)

LONDON.-Share prices on the stock markets of London, Tokyo, Zurich and much of the industrialized world plummeted today amid gloomy world economic predictions and the continued pressure ot high U.S. interest rates.

Prices on the London Stock Exchange, after plunging nearly 30 points by noonthe equivalent of a 54-point drop in the U.S. Dow Jones index-closed 17.2 points down, the latest of several near-record drops it has suffered in the last two weeks.

The Tokyo stock market suffered one of its worst days ever, and prices in Zurich recorded their biggest loss in six years. The Duesseldorf stock exchange had its biggest drop this year and prices also plunged in Hong Kong, Sydney, Toronto and Paris.

The major exception to the worldwide stock market drop was the United States, where Wall Street rallled with an 18.55-point rise in the Dow Jones index. [The Tokyo market rebounded sharply in early trading Tuesday, however, following the Wall Street rally, Washington Post correspondent Traey Dahl by reported.)

The dramatic drop followed several days of sliding prices in major stock exchanges. Most market analysts have attributed the worldwide slump to fears about the size of the U.S. budget deficit. If the Reagan administration ls unsuccessful ln meeting its stated budget-cutting goals, many investors abroad tear, extensive U.S. Treasury borrowings could keep interest rates high and lead the world to an economic depression.

Some analysts also said the stock slide could have been given momentum by pessimistic predictions late last week by U.S. stock analyst Joseph Granv1lle, who warned of huge drops on the London, Wall Street and other stock exchanges.

While the losses mean severe economic consequences in most of the world exchanges, they are also expected to have serious political repercussions in Britain.

The drop continued a steep two-week slide being called "the black fortnight" here that has created a crisis atmosphere in financial circles and added considerably to the economic and political problems of Prime Minister Margaret Thatcher. The Financial Times index of 30 leading stocks has now plummeted 96 points in 11 trading days, a drop of 17 percent that has wiped an esti-

mated $30 billion off the paper value of British industry.

Market analysts blame the loss ot investor confidence here on growing pessimism about the future of Britain's battered economy and Thatcher's monetarist policies after a period of optimism earlier this year that the country might be starting to pull out of its worst recession in a halt-century.

The fall here began Sept. 14 when the government authorized the Bank of England to raise the effective minimum interest rate on bank borrowing from 12 to 14 percent to protect the exchange value of the pound. Partly because of the disparity between the British rate and the 20 percent prime rate in the United States, which has drawn money away from · Britain, the pound's dollar value has shrunk from $2.47 earlier this year to $1.78 today.

Analysts said the increase in British interest rates was a big blow to confidence in Thatcher's economic strategy, despite her Cabinet reorganization that same day designed to signal her determination not to change course.

There has been persistent speculation in the financial community here that interest rates may be raised again to approach the record 17 percent reached near the beginning of the Thatcher government before reductions were made to try to help British industry recover from the recession.

"There are fears that interest rates wlll go up again during the next week because the pound is falllng again," said Paul Neild, chief economist of Ph1llips and Drew stockbrokers, who have long been critical of Thatcher's policies. "There has been a loss ot confidence and credib111ty in the government's overall strategy and a question mark over prospects for recovery from the recession. There is now a grave risk of a renewal ot the recession."

London Stock Exchange Chairman Nicholas Goodison, who has defended "the greatest thrust of government policy" as the only way to restructure the British economy, said today that "confidence will be recovered only if the government's economic policy works, if inflation is seen to be coming down and government spending is being cut."

He indicated that Britain also needed help from the Reagan administration. "The U.S. is not balancing its own budget and is keeping interest rates high," Goodison said.

Britain has had nothing but bad economic news recently. Industrial output has continued to fall, and unemployment is still rising. With the unemployment rate now over 12 percent, the highest among major industrialized countries. nearly 3 mlllion Britons are jobless, more than during the depths of the 1930s depression.

Britain's infiation rate, which had decreased steadily for a year to provide the only statistical slgn of success for Thatcher's policies, has turned upward again, increasing last month from 10.9 to 11.5 percent. The growth of the money supply, a crucial indicator in Thatcher's strategy, also has continued to exceed government targets.

Meanwhile, total government spending, rather than being reduced as Thatcher intended, is estimated to increase greatly during the next fiscal year. This would increase the budget deficit and government borrowing, which could fuel inflation and force interest rates up further.

Like Reagan, Thatcher must make more spending cuts this fall. Although her government has already significantly reduced expenditure-::: for housing, education and other public services, deeper cuts in social programs have been thwarted by resistant members of her Cabinet. She fired some of them in her recent Cabinet reorganization and moved others to put less reluctant budget-cutters in charge of most big-spending departments.

Thatcher will still find it difficult to make more cuts. Much of the increase in government spending has been in benefits for the many more unemployed. The recession has increased the money needs of nationalized Industries, although they have laid off tens of thousands of workers.

Correspondent Dahl by added: The crash in Tokyo sent shock waves

through the city's financial district Monday as the 225-stock Dow Jones average fell 302.84 yen, its sharpest one-day decline, in value terms. But by midmorning Tuesday it gained 152.34 yen, recovering slightly more than half of Monday's loss.

Previous plunges here have been much greater in percentage terms, and Monday's drop appears to have no serious political implications. If anything. economic crises here tend to bolster the popularity of Japan's Liberal Democrats because after 26 years in power they form the only political party with tested economic expertise.

A major factor in today's drop may have been the recent rush of Japanese companies into the market with public stock offerings in a bid to increase financial reserves.e

CLEAN AIR

• Mr. EAST. Mr. President, the Clean Air Act, which expires September 30, is once again under congressional review. Although some advocate its abolition in toto, the evidence shows that our air is cleaner today than in 1970 when the law was enacted.

The citizenry demands that their air be healthful, and they deserve it. I am sure that when this body completes its review, the record will reveal that the Congress supports clean air as well.

Mr. President, many reforms are being touted for the act. A midsummeT Wall Street Journal editorial presents some thought-provoking options that should be carefully considered. I ask that the article be printed in the RECORD.

The article follows: [From the Wall Street Journal, July 14, 1981]

Am IsN'T FREE

The administration's proposed revisions of the Clean Air Act, which are expected to be sent to Congress this week, aim at reducing cumbersome bureaucracy and cutting costs to business and consumers. While many of the recommendations would make needed improvements in this 11-year-old legislation, the administration may not be going far enough to temper the act with a strong dose of economic realism. In particular, the White House is shying away from its self-avowed tenet of weighing costs against benefits of federal regulations.

President Reagan issued an Executive Order on Feb. 17 that requires agencies to evaluate the potential benefits and costs of their major regulatory proposals. Such analysis can have a healthy effect on the economy by stripping away unnecessary or overly costly regulations, but even the Reagan administration is not unfettered in its ab111ty to introduce regulatory relief, as a recent U.S. Supreme Court decision made absolutely clear.

In a case about workers' exposure to toxic substances, the court ruled that the government cannot use cost-benefit analysis in setting occupational safety and health regulations because no such provisions were set In the original legislation. Rather, it said, the law states that safety and health risks must be reduced to the extent "feasible," i.e., without regard to how large the costs or how small the benefits. The court's decision highlights the danger of using vague legislative


language to skirt around hard economic and health decisions.

When Congress passed the Clean Air Act in 1970, it similarly failed to address squarely the inherent economic and health choices.

~ .. For instance, the act contains no provision explaining what the economy can afford to spend to improve the quality of the air. Instead, it says that national air quality standards must provide an "adequate margin of safety" against "significant adverse health effects." Given such vague language, it is not surprising that the courts have consistently ruled that costs cannot be taken into account in setting air quality standards.

Scientific research of the past 10 years or more has also shown that the health goals of the act are unattainable. The smallest amount of air pollution wm always adversely affect small segments of the population, such as those people who suffer from, say, allergies or emphysema. Even if every man-made source of air pollution were closed tomorrow, natural sources of pollution such as decaying forests and swamps would continue to harm the heal t'h of some people.

The administration's working group on the Clean Air Act drew up three options to redress the problem of setting air quality standards: to leave the cu'l'!rent wording intact; to eliminate the "margin of safety" language and to consider the "degree of significant risk of adverse health effect"; or to allow costs to be considered in providing protection against "unreasonable risk." The administration has apparently decided to abandon the cost-benefit approach and to opt for the middle course.

T'he Reagan administration may consider it sufficient to replace the current loosely worded air quality goals with a. policy of risk assessment-implying that some degree of health risk is considered acceptable-without specifically requiring an analysis of benefits and costs. But that strikes us a.s unnecessarily concmatory in political terms toward the environmental lobby and likeminded leaders on Capitol H111. It is a gesture that 1s unlikely to win the administration much praise from either side in this year's debate.

Improvement in air quality remains a worthwhile goal. But what is less widely recognized-particularly along the corridors of t'he Environmental Protection Agency-is that clean air carries heavy costs and it 1s economically important to ask how clean is clean enough. The Council on Environmental Quality estimates that air pollution control cost the U.S. $25 b1llion in 1979 and the costs could exceed $40 billion by the mid-1980s. Moreover, expenditures on pollution control equipment also represent lost opportunities to invest in productive ventures which could materially improve our standard of living with inputs of new goods and services.

In revising the Clean Air Act, Congress should seek to facilltate the least costly way of maintaining or improving air quality. For instance, the requirement that new plants install t'he "best available control tec.hnology"-often meaning the most costlyshould be scrapped in favor of a flexible and innovative approach. And in promulgating new air quality standards, the government should be required to we.igh the benefits against the costs. There 1s no such thing as free clean air ·•

DEATH OF FORMER VENEZUELAN PRESIDENT ROMULO BETANCOURT

Romulo Betancourt. He was a friend to my family and to our Nation.

Romulo Betancourt met with President John F . Kennedy and with Senator Robert Kennedy many times. They viewed events in Latin America and in the world from the same perspective, a perspective of men committed to the ideals of democracy and social justice. It was that vision that remains imbedded in the consciousness of the hemisphere. We must never forget nor be allowed to forget that throughout the Americas, men and women still hold those ideals and still give their lives for those ideals.

Romulo Betancourt dedicated himself to construction of a strong and vigorous democracy in his own country. Twice, he served as President and carried the message of democracy throughout Venezuela and to the far corners of this hemisphere. At a time when all too many countries in the region were ruled by dictators anq military cliques. Venezuela was a shining contrast of liberty and due process. He made respect for the individual a cornerstone of Venezuelan democracy.

And in 1968, he demonstrated to the world his own personal devotion and commitment to the principles he preached by leading the peaceful transfer of power to the opposition when his own party lost the Presidential election.

Venezuela has lost one of its most distinguished and honored citizens. The world has lost a defender of democracy and human rights. And all of us who prize those ideals have lost a valued friend. But President Betancourt and his example remain to inspire generations to come in the never-ending struggle to preserve and protect basic freedoms and human dignity.e

RECESS UNTIL 9 P.M. TODAY Mr. BAKER. Mr. President, I ask

unanimous consent that the Senate stand in recess until 9 p.m. today.

There being no objection, the Senate, at 6 p.m., recessed until 9 p.m.; whereupon, the Senate reassembled when called to order by the Presiding Officer (1.\l!r. GORTON).

ORDER OF PROCEDURE Mr. BAKER. Mr. President, I under

stand the House of Representatives is about to receive the conference report at this moment.

I expect it will be another hour at the earliest before the Senate will receive a message from the House of Representatives on the conference report on the continuing resolution.

INTERNATIONAL DEVELOPMENT ACT OF 1981

SECURITY AND COOPERATION

The Senate continued with considera-tion of S. 1196.

• Mr. KENNEDY. Mr. President, it is Mr. BAKER. Mr. President, I 1nquire with great sadness that I learned of the of the distinguished chairman of the death in New York City on September Foreign Relations Committee if he is in 28, of former Venezuelan President a position to proceed with other business

in connection with the Foreign Assistance Act at this time?

Mr. PERCY. Yes; the pending business ic the Proxmire amendment. The yeas and nays have been ordered on that. It would be my suggestion to ask unanimous consent that we proceed with the vote on that but have a 30-minute vote which would allow adequate time to notify Senators. They did know we were coming back, that there may be votes after 8: 30 p.m. Then that would give us an extra few minutes to prepare and line Senators up to bring up other amendments. we wish to proceed and complete as much as we can of this bill.

Mr. BAKER. All right. As I understand it, the vote on the

Proxmire amendment has been ordered. Mr. PERCY. The yeas and nays have

been ordered. Is that correct? The PRESIDING OFFICER. The yeas

and nays have been ordered. Mr. PERCY. That is the pend1ng busi

ness. Mr. BAKER. Mr. President, rather

than ask permission to have a 30-minute rollcall, I am going in a moment to suggest the absence of a quorum which will run for about 15 minutes or a little less, and then we will call it off and proceed with the rollcall vote at that time.

I ask our cloakroom on this side to notify Senators that at approximately 9:15 p.m. the vote will begin on the Proxmire amendment and I ask the distinguished acting minority leader if they are inclined to do the same thing?

Mr. DIXON. Yes. Mr. PERCY. That would be a very sat

isfactory arrangement. May I also suggest to all Senators and

staff who may be listening to this that they come forward with their amendments. This will be the last time for some time that we will have a chance to bring this bill up because we have the AWACS hearings all next week and if Senators who have am.endments are not able to come to the floor, would they or their staff authorize the managers of the bill to call up their amendments? ·we have disposed of a half dozen of them that way this afternoon. So long as they are noncontroversial, we can accept them and proceed with our business then.

Mr. BAKER. I subscribe to the statement just made by the chairman of the committee and I, too, urge Members to come forward and offer their amendments.

Mr. HELMS. Mr. President, will the Senator yield?

Mr. BAKER. I yield. Mr. HELMS. Mr. President, I wish to

ask the majority leader if he has reached any accommodation with the minority with respect to the Executive Calendar.

Mr. BAKER. Could the Senator from North Carolina give me just a moment?

Mr. President, I am advised that it may be possible to do that later in the evening. I say to the Senator from North Carolina I am anxious to do that, and I will pursue that request.

Mr. HELMS. I thank the Senator. Mr. BAKER. Mr. President, I yield to

the Senator from Illinois.


EL SALVADOR

Mr. PERCY. Mr. President, as the Senate knows we adopted an amendment dealing with El Salvador last week. This was regretfully an item where I could not come to agreement with the administration, and we simply agreed to disagree.

I am very happy to report that the State Department has done so in an act of comity, and I wish to read into the RECORD what the State Department ofiicial position has been after the Senate adopted its resolution on El Salvador.

The State Department indicates through a spokesman:

We would have preferred the sense-of-Congress language, the Heims-Lugar amendment, but we can live with the new language. After all, both we and Congress are interested in the same objectives for our policy in El Salvador, protection of human rights, implementation of economic reforms, and free elections leading to a peaceful resolution of the conflict. And the disagreement we had was over the best means of reaching these goals.

The language in the Pell amendment is a definite improvement over the language in the b111 when it first came to the Senate floor. For example, the influence of factors beyond the control of the Government of El Salvador wlll be taken into account in making a certification, a recognition of obvious complications in achieving these policies in the face of persistent guerr1lla activities which are not motivated by these same goals, also the standards to be certified are in some respects expressed in terms which more closely reflect the situation in that country.

So I think it is a distinct gesture on the part of the administration to reach out to recognize that this body will not al~ ways concur with the administration.

We have a shared responsibility, and they recognize that.

Though I regret that we could not have reached an agreement, I do think with this explanation as to their present position now on refiection does indicate that we are not nearly as far apart as might have appeared at first blush.

I am happy to yield to my distinguished colleague from Massachusetts.

Mr. KENNEDY. Mr. President, earlier today I had the opportunity to be with the members of the families of the four missionaries who were brutally murdered in El Salvador.

I had spoken on that tragic incident just a few hours after it was reported last December, and on the subsequent murder of two American labor representatives in January, and I had met with the members of those families in March of this year.

I also had the opportunity recently, as did others, to meet with the President of El Salvador. President Duarte indicated that he is very desirous of additiona! technical help and assistance from the United States, including the Federal Bureau of Investigation, in order to resolve some of the most brutal and violent acts against American citizens who were there only to serve the people of El Salvador.

I would like to ask the chairman of the Foreign Relations Committee whether he is satisfied that the request by the El Salvadoran Government for help and assistance from the Federal Bureau of

Investigation is moving in a satisfactory way. Could he give assurance to the members of the families, who have lost their dear ones in that brutal murder, that he will insure that requests to the U.S. Government for technical help and assistance, primarily from the FBI in terms of ballistic testing and other support, will actually be achieved.

Mr. PERCY. I thank my distinguished colleague for raising this very, very important issue. It has been on all of our minds. It has been the subject of a telephone conversation I had with the president of the junta-there is no president of the country, but he is the president of the junta-and Jose Napoleon Duarte assured me that as of that time everything possible was being done, and the FBI was extending to him full cooperation.

I have subsequently talked with Judge Webster, the head of the FBI, who assured me also that everything, every service that they were asking for, was being provided.

I have not talked to him about this matter recently. I just left him a few minutes ago at a dinner. I could reach him and get a report before the evening is over as to whether there is anything that can be done to assist this matter further.

As we understand in the Committee on Foreign Relations when we talked to Jose Napoleon Duarte he indicated that they did have evidence. A part of that evidence was a :fingerprint which was obtained with the assistance of the FBI.

They are concerned that the evidence, though possibly adequate to bring an indictment, would be somewhat short of a possible conviction in their legal system, and they are anxious to nail this down so that when they prosecute they will succeed if they are indeed guilty and proven so by the evidence.

I feel, from our standpoint, the amendment adopted last week embraces language on the murder of six American citizens. We have kept this as one of the very high priority items with both the administration and the Government of El Salvador and I would be very happy to report back-! could report back within an hour and a half or so, and bring my colleague as much up to date as possible.

But we do express great appreciation for the Senator's interest which he has shown in this matter, which has been a matter of highest priority for the Committee on Foreign Relations.

Mr. KENNEDY. I thank the chairman of the committee, and I appreciate his sincerity and his willingness to respond to these very deep concerns.

When President Duarte was here this past week I talked with him at some length about this particular incident. He had indicated to me that they had made some additional requests of the Federal Bureau of Investigation, and I have confidence that Judge Webster, being the individual that he is, would want to respond in every way possible to these extremely reasonable requests.

I just want to make sure that there are not going to be any impediments placed in the way, for whatever reason, to seeing

tha.:t that kind of response will be forthcomiJl'g.

The members of the families of the four missionaries and two labor representatives-Sisters Maura Clarke, Ita Ford and Dorothy Kazel, Ms. Jean Donovan, and Michael Hammer and Mark Pearlman of AIFLD--deserve the kind of response the Senator has been most willing to indicate he would be prepared to make. He has many responsibilities, and I realize this is an important piece of legislation, but I do think those kinds of assurances here in the U.S. Senate are extremely important-not just to those families but to the thousands and millions of Americans who are concerned about that extraordinary tragedy.

I want to indicate at this time that I will continue to work with the chairman of the Committee on Foreign Relations on this particular matter. I know that anything he can add in the course of the debate which would illuminate this situation, and everything he can possibly do after we consider this legislation, will be very much appreciated by the families themselves and certainly by this Senator.

I thank him for his response, and if he would be willing to see what assurances he can get, I would certainly be grateful for that.

Mr. PERCY. Mr. President, if the Senator would like, I would be very happy, and be joined by Senator PELL, to address a letter to the families indicating you have made this request of us, that we keep them apprised intimately we have seen to it that infunnation with respect to the atrocities and murders is required as a part of the first certification that must be given by the President to the Senate.

It was not one of the four goals or objectives established for El Salvador; it was a separate part that certification would be required for the President. That obviously would be obtained by the Embassy, the FBI, and other agencies. But we will see that that informa,tion in the certification is provided both to the distinguished Senator from Massachusetts and, if he would like, directly to the families so that we can keep them up to date, so that they know we are deeply concerned, we share your concern, and Will provide to them every bit of information.

Both of us have shared tragedies in our families, and both of us know the anguish we g0 through when some assailant has caused the death or loss of a tami.ly member. In our case it is going on 15 years now, and we still would like to know, if it is possible to find who committed that crime, that certJainly they would be prevented from doing it again to anyone else.

Until those cases are solved, they always hang over the minds of the family, the loved ones, concerned ones, and friends. So I can assure the distinguished Senator it will be a matter of personal concern to myself and every other member of the committee.

Mr. KENNEDY. The Senator is a man of many different capacities. I think this kind of expression of humanitarian con-


cern will make a great deal of difference to those families.

Let me just add one point here, and that is there have been over 600 individuals Who are members of the security forces who have been actually arrested for the violation of human rights, some for grievous violations, matters of life and death.

There are only six, as I understand it, who have been tried and convicted and are actually being held.

There is a recognition, whether stated or unstated, that those who have been associated with the various military groups can be arrested, can commit violations of human rights with some degree of impunity, and even if they are arrested, it is unlikely they will be bought to trial; and even if brought to trial, it is unlikely they will be convicted; and if convicted, it is unlikely they will serve any time or receive any penalty. That is well understood in El Salvador.

I think the record has been laid out here. I just want to make it extremely clear to those individuals in El Salvador that on this issue as well as I would hope on individuals whose native land is El Salvador, that we are going to watch this record extremely closely over a period of time, and we are not going to stand by and see these extraordinary acts of violence continue without adeqUate response, and particularly as it relates, I think, to our fellow citizens and, as hopefully, it relates to the human family, the citizens of El Salvador.

So we are talking about more than a technical matter. We recognize the jurisdiction and the judicial system and we respect the sovereignty of another nation. But we watch, and we watch closely and we watch carefully for results. I know that is what the Senator from Dlinois is saying this evening, as other colleagues have stated, and I want to personally thank him for those assurances for the members of the families who have lost their dear ones.

Mr. BAKER. Mr. President, I am advised now, for the information of Senators, that the House of Representatives will not convene until 9 :45 to proceed with their consideration of the conference report on the continuing appropriations. I am afraid that means a very long night for the Senate since we must wait for the House to act.

But I would encourage Members who have amendments to the Foreign Assistance Act to come to the floor and offer them. The distinguished chairman of the committee indicates that there are some three or four amendments he is aware of that are yet to be offered tonight, and I would urge that Members consider that this, as the chairman pointed out, may be the last opportunity to deal with this measure for some time in view of the requirement otherwise laid on the Committee on Foreign Relations and the requirements of the Senate calendar as well.


Mr. President, it is 9:20, and while I had planned originally to suggest the absence of a quorum to delay the time for the beginning of a vote on the Proxmire amendment until 9: 15-and that

time has passed-! am also advised that the principals involved are at hand and are available.

I will not now suggest the absence of a quorum. I would suggest, instead, that we are prepared to have a vote on that amendment.

Mr. President, have the yeas and nays been ordered on the Proxmire amendment?

The PRESIDING OFFICER. They have. Is there further debate? If not, the question is on agreeing to amendment No. 551 of the Senator from Wisconsin <Mr. PRoXMIRE) . The yeas and nays have been ordered and the clerk will call the roll.


Senator from Nevada <Mr. LAXALT), the Senator from New Hampshire <Mr. RUDMAN), and the Senator from Connecticut (Mr. WEICKER) are necessarily absent.

Mr. CRANSTON: I announce that the Senator from Virginia <Mr. HARRY F. BYRD, Jr.), the Senator from Nevada <Mr. CANNoN), the Senator from Louisiana <Mr. LoNG), the Senator from Hawaii (Mr. MATSUNAGA) , and the Senator from New York <Mr. MoYNnrAN) are necessarily absent.

The PRESIDING OFFICER. Are there any other Senators in the Chamber desiring to vote?

The result was announced-yeas 92, nays 0, as follows:

[Rollcall Vote No. 300 Leg. J YEAS-92

Abdnor Gam And:rews Glenn Armstrong Goldwater Baker Gorton Baucus G1'888ley Ben'tllen Hart Btden Hatch Boren Hatfield Boschwttz Hawkins Bradley Hayakawa Bumpers Heftlll! Burdick Heinz Byrd, Robert c. Helms Cha!ee Hollings Chiles Huc.Idleston Oochra.n Humphrey Oohen Inouye Om.nston Jackson D'Amato Jepsen Danforth Johnston DeConclni K8S6ebaum Denton Kasten Dixon Kennedy Dodd Leahy Dole Levin Domenll.ci Lugar Durenberger Mathias Eagleton Mattingly East McClure Exon Melcher Ford Metzenbaum

Mitchell Murkowski Nickles Nunn Packwood Pell Percy PresSler Proxmtre Pryor Qu-ayle Randolph Riegle Roth Sa.rba.nes Sasser Schmitt Simp8011 Specter Stafford Sten'Illls Stevens Symms Thurmond Tower Tsongas Wallop Warner WUllama Zorinslty

NOT VOTING-8 Byrd, Le.xalt Moynihan

Harry P., Jr. Long Rudman cannon Matsunaga Welcker

So Mr. PRoxKIRE's amendment (No. 551) was agreed to.

Mr. BAKER. Mr. President, may we have order?

The PRESIDING OFFICER. The Senate wm be in order.

Mr. BAKER. Mr. President, I am advised now that the House is in session. They resumed their deliberations about 2 or 3 minutes ago. They are prepared now to go to the consideration of the conference report on the continuing resolution.

I estimate for Members that it will be perhaps an hour at the very latest before we have a message from the House on that subject.

I inquire of the managers of the bill on both sides if they are ready to proceed at this time with other amendments.

Mr. PERCY. The managers of the bill are prepared to proceed. The next amendment will be a Proxmire amendment, followed by a Zorinsky amendment. We will have three or four amendments. We cannot tell whether there will

be rollcall votes. We have to be prepared for rollcall votes on them.

We intend to proceed up to the moment we take up the continuing resolution, to acomplish as much as we can on this bill.

AMENDMENT NO. 552

(Purpose: To deobllgate certain funds obligated for Syria)

Mr. PROXMIRE. Mr. President, I call up amendment No. 552.



The Senator from Wisconsin (Mr. PaoxMIRE) proposes an amendment numbered 652.

Mr. PROXMIRE. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.


The amendment is as follows: On page 23, line 22, strike out the quota

tion marks and the second period. On page 23, between lines 22 and 23, Insert

the following: "(h) All funds appropriated In prior fiscal

years to carry out this chapter which have been obligated for Syria shall be deobllgated except for funds committed or earmarked as of April 9, 1981, for (A) signed contracts; (B) issued invitations for bids, requests for proposals or offers, or purchase orders; (C) projects involving the 'Fixed Amount Reimbursement' payment procedure for which designs ha.d been approved by the Agency for International Development; or (D) participant training which had been approved by the Agency for International Developmelllt and which is being conducted in the United States or at a univer&ity outside Syria which receives assistance under section 214 ot this Act. All funds deobllgated pursuant to this paragraph shall be deposited in the Treasury as miscellaneous receipts:•.

Mr. PROXMIRE. Mr. President, this amendment deobligates $102.2 million in prior year funding for the country of Syria. It would reduce the backlog of U.S. commitments to Syria from $355.'1 to $253.5 m1llion. The savings of $102.2 million would come from eliminating all of the unobligated funds in the $355 million pipeline.

I cannot imagine that the American public supports a continuing foreign aid program to the country of Syria during a time of tight budgets at home and strong Syrian opposition to U.S. policies abroad. When we are cutting housing, dairy price supports, transportation, health care and thousands of other programs that benefit individual Americans, it is not only ironic but indefensible that we should continue supplying Syria with tens of millions of U.S. dollars from previous commitments.


Yes, Syria-the foe of the Middle East Peace Agreement; the occupying force in Lebanon; the client state of the Soviet Union; the prime stumbling block to peace in the Middle East; the country who has armed and encouraged the PLO; the government which almost daily castigates the United States and defends the Soviet Union for its invasion of Afghanistan.

Today, as we debate this foreign aid bill, Syria continues its plan of aggression in the Middle East by waging open warfare against Christian forces in Lebanon and by stationing advanced Soviet surface-to-air missiles in that country which pose a distinct threat to Israel's national security.

And what is the response of the United States? Our response is to hand over to this government, which publicly denounces the United States as a criminal, to hand over to this government $355 million in prior year commitmentsmoney from the pockets of millions of American taxpayers to a regime which has vilified this country and every peace effort we have engaged i.n in the Middle East for a generation.

HUGE U.S. AID BACKLOG

Let us look at the economic facts. From 1976 to 1979, the United States pledged the Government of Syria a total of $429.5 million in loans and grantsmostly loans with extraordinarily favorable repayment terms-so favorable in fact that they really are long-term grants. Then in 1979, the Carter administration requested an additional $60 million for Syria and the Congress said no. A Proxmire amendment passed which reduced the funding to a very low level. And since then no new requests have been forthcoming.

But that is only half of the story. During these 4 years, very little was accomplished with these U.S. funds. A huge backlog appeared-money that was appropriated for Syria but which had not been able to be spent due to simple mismanagement by the Syrian Government and the inability of our AID program to generate the economic activity to carry out these developmental programs. The backlog now stands at $355.7 million.

The Syrian AID program came under investigation from AID's own internal investigators. The auditors found and officially reported "Almost 4 years have elapsed since AID resumed a program in Syria and very little has been accomplished." Further, they found that "recent developments in the Middle East make the political justification for the Svrian AID nrogram que!'ti.onable." Afld they concluded that "We believe AID should reassess their programmatic efforts in Syria and determine whether the present program will be continued or if it Will be necessary to deobligate funding presently available." Let me repeat that last phrase: "or deobligate funding presently available."

So the first suggestion to deobligate existing funds for Syria came from the very Agency that is responsible for our foreign aid program-AID.

Now, where do we stand today?

CURRENT AID PLANS

The conference report on H.R. 3512, the supplemental and rescissions bill stated:

The managers on the part of the House and Senate insist that no additional funds for Syria will be disbursed during the remainder of fiscal year 1981 and that the issue of the remaining undisbursed funds in the Syrian pipeline shoUld be resolved in the fiscal year 1982 authorization and appropriation process.

That time is now. The backlog totals $355.7 million from prior year commitments. Of that amount, $243 million is committed by specific contract or bid process except for $10.48 million recently deobligated and returned to the Treasury by AID. This $10.4 million was for the Euphrates Basin irrigation maintenance project.

This means that of the $355.7 million in the pipeline, $102.2 million remains to be specifically obligated. It is unobligated now. No contractors are involved. There is no call on this money. No termination costs would be involved if it were deobligated. My amendment would deobligate and return to the Treasury the full amount of $102.2 million.

What projects would be stopped? The unobligated funds, which are years behind schedule for obligation and expenditure due to mismanagement both by AID and the Syrian Government, would go for some water supply and electrification projects. But the largest amount would go for road constructionroads that have military significance since they would be used, due to their geographic location, for the movement of armed forces into Israel or Jordan.

SYRIAN MISCHIEF IN MIDDLE EAS'l

And what of the recipient? To what just cause is our money going? These funds are contained in the account called security supporting assistance. The question is-whose security are we supporting? Surely, not Israel's, since their prime enemy is Syria. Certainly, not United States security, since our most vicious opponent in the Middle East is Syria. This money is supporting someone's security, however-the security of Syria and its treaty partner-the Soviet Union.

Let us just remember the role Syria has played in the Middle East before we give up one more dollar in foreign aid to that country.

First, Syria has carried on a coordinated worldwide campaign against the Middle East Peace Treat:v. Do you remember when this body rose in sustained applause when Prime Minister Begin and President Sadat were honored in a joint session of Congress? Well, Syria's official policy calls for "destroying this treaty and foiling its results by every means possible."

What was our response? We gave them more money.

Which Arab country, of all others except pro-Soviet South Yemen, did not condemn the Soviet Union for its brutal invasion of Afghanistan? The same country which calls the United States the "evil master of colonialism.'' The

nation that blames the United states for it.s own domestic political violence. The same nation whose President has said, "The United States is the No. 1 enemy of our people and our Arab nation."

So how did we, the No. 1 enemy, respond? We gave them more money.

The Syrian Government has said there is no room for neutrality concerning the Zionist enemy and its allies, and therefore Arab countries "must reject middle of the road stands on the issue of the 'alliance with Zionism."


President Assad has stated, "I am for a Palestinian state on Palestinian soil; namely, between the Mediterranean and Jordan River. I want to stress that particularly." And what does that mean? It means that the Palestinian state would occupy and abolish the State of Israel. What could be more clear?


Syria was the founder of the ReJectionist Front-the organization behind the Bagdad conference which repudiated the Peace Treaty, castigated Egypt and formed a military all1ance against Israel and Egypt.


And when President Assad went to the so-called nonalined conference in CU!ba, he fiercely condemned the camp David Accords and the United States.

And we continued to provide more money.

Damascus radio has been monitored as saying that Syria "will allow anything which come in for the Palestinian resistance---,be it humanitarian or military--especirully if it is related to the conflict with Israel." To back up it.s words with power, Syria has formed its own PLO type organization-a guerrilla group which operates throughout Lelbanon and in surrounding Arab States. Its particular goal seems to be open warfare against Christian enclaves in Lebanon.

And what was our response? We gave them more money.

CONTINUING CRISIS IN LEBANON

Let us not forget tragic Lebanon. I wish every Member of this body had read the testimony of American-Lebanese groups about what has happened in Lebanon thanks in great measure to Syria. Surely no one would be voting for Syrian foreign aid if they examined the picture of war torn Lebanon very closely. Syria has 20,000 to 25,000 troops in Lebanon that routinely shell Christian enclaves and that even today are provoking a crisis there by seizing areas in south Lebanon previously left alone and by challenging Israel air superiority with Russian SAM missiles.

To some. this may seem a momentary state of affairs. But to tho.::~ wh" """ve looked at the history of relationships between Syria and Lebanon, a larger picture emerges. Syria does not believe in a free and independent Lebanon. Syria has long espoused a greater Syria including Lebanon under one government.

September 30, 1.981 CONGRESSIONAL RECORD-SENATE 22569

In 1946 they economically boycotted Lebanon to bring it to its knees. In 1957 Syria encouraged violent demonstrations in Beirut against the government. And since the mid-sixties, Syria has advocated using southern Lebanon as a base of operations against Israel.

And what was our response? We gave them more money.

INTERNAL REPRESSION It should be needless to say that in

addition to these other factors, Syria has been a consistent violator of the rights of its own citizens. That .government refuses to allow Jews to emigrate. Jews must carry special ID cards with curfews and internal travel restrictions. Amnesty International has documented numerous cases of torture of political opponents. Over 120,000 Kurds have been displaced and dispersed, denied proper representation, cultural and Iinquistic freedoms. While this comes as no surprise, our response has been to .give them more money.

MmDLE EAST PEACE MISSION Some may claim that this is a bad

time to be deleting money from Syria while discussions are continuing to defuse the Middle East situation.

I say this is the best time to deappropriate funds to Syria.

As long as it deploys surface-to-air missiles in Lebanon, we should turn off the money spigot to the Syrian ·Government. As long as Syria keeps fanning the flames in the Middle East, leading that region to the brink of war, the United States should keep its funds at home.

The United States should not be in the business of rewarding a nation that has historically acted as a destabilizing force in the Middle East.

The State Department argues that Syrian foreign aid was established to maintain comm.unications with Syria, to keep ?ur foot m the door, perhaps so we m1ght slow down her drift toward the Soviet Union.

I say we never had our foot in the door in the first place and the money we have sent to Syria has not wedged it open one bit. And the drift toward the U.S.S.R. has become a landslide

Syria has remained one of the· Soviet Union's few allies in the Middle East. Last October, the two countries signed a 20-year friendship treaty. Syria rec~ives most of its arms from the RusSlans. The SAM missile batteries in Lebanon are Soviet-supplied. There are ~.500 ~viet military advisers stationed In Syria.

Some diplomatic analysts have susp~ted ~hat Moscow has been pulling strmgs m this latest missile crisis to restore Soviet influence in the Middle East. Secretary of State Haig has specula~ed that t~e Russians are stirring up t~us trouble m Lebanon to divert attention from Poland. O~e freq~ent argument for providing

fore1gn aid 1s to maintain influence with a country. . The problem with Syria is, we are pro

Vlding the foreign aid and the Soviets are maintaining the influence.

The House Foreign Affairs Committee in reporting out this bill has in-

eluded a provision which will deappropriate to the Treasury all the obligations tor Syria that have not been specifically committed or earmarked to contractors. Thus the House action will result in a savings of $102.2 million. Unless amended, the Senate bill will not save a penny.

Every time the Syrians kick Uncle Sam, he coughs up some more greenbacks. This is one Senator who is tired of hearing the Syrian charges, who is tired of being polite to a nation that violen.tly objects to our peace efforts in the Middle East. What kind of nonsense is it that we respond to Syrian aggression with a continuing flow of tax dollars? This is worse than pouring the money into the sea. Our money actually works against our own Nation's foreign policies.

There may be some who enjoy this diplomatic dance but there has been no payoff in the last 10 years. Enough time has gone by to test out the theory that a pat on the back and a dollar in the pocket will make Syria a reasonable and responsible member of the world community. It has not worked. They take our money, insult our Nation, and laugh behind our backs at our foolishness.

It is time to respond. Mr. STENNIS. Mr. President, may we

have order? This is an important matter. It concerns a great deal of money.

The PRESIDING OFFICER. The Senate will be in order.

Mr. PROXMIRE. Mr. President, since the introduction of this amendment, discussions have been held among personnel of the Department of State, AID, the Foreign Relations Committee, and my staff.

A compromise position has been worked out. Recognizing the congressional concerns about the expenditure of prior year funds for Syria, the State Department has agreed in writing to not further commit or spend prior year funds which have not been already committed or earmarked as of April 9, 1981. This agreement extends for the period of fiscal year 1982 and would include the provision of a deferral message covering these prior appropriations.

This language would cover a minimum of $102 million and quite probably more. The deferral, of course, could be turned into a permanent denial of the funds next year, and that is what I hope would happen. These funds should be returned to the Treasury.

But, for now, the agreement states clearly that none of these funds shall be obligated-that is, committed-to any specific project or contractor for use by Syria or actually spent.

Given these precise assurances, which would govern the Department of State and its funding agent, the Agency for International Development, and considering the clear understanding that the parties have about the nonavailability of these funds, I am willing to withdraw my amendment from further consideration, if this can be confirmed by the manager of the bill, the distinguished Senator from Minnesota.

Mr. BOSCHWITZ. Mr. President, I concur with this amendment and am pleased that the Senator from Wisconsin is withdrawing it.

I should like to enter into the RECORD at this point a letter from the Department of state, stating the policy of the Department of State, that there will be no new commitments on this Syrian AID program until there is a change in attitude and heart on the part of Syria with respect to a nl.unber of subjects. I ask unanimous consent that th:e letter be printed in the RECORD.

There being no objection, the letter was ordered to be printed in the REcORD, .as follows:

DEPARTMENT OF STATE, Washington, D.C., September 30, 1981.

Hon. RUDY BoscHWITZ, Chairman, Subcommittee on Near East aftd

South Asian Affairs, Committee on Foreign Relations, U.S. Senate

DEAB MR. CHAIRMAN: Since May 198111t haa been the policy of the Department and A.I .D. t'halt undisbursed funds in the Syrian aid program pipeline beyond those committed or earmarked as of April 9, 1981 as defined by the Foreign .A.sslsta.nce authorization blll,

Considering congressional concerns reg&~l'lding the eXJpendl ture of prior year funds for Syria., we confirm our understa.nd1ng that the Depe.rtment of state would not expend or commit in FY 1982 an'Y undisbursed funds in the Syrian aid program pipeline beyond those committed or ea.rma.rked as of April 9, 1981. We 81lso give om- assurance that we will recommend that the President transml.t a. apecia.l message to the Congress pursuant to section 1013 of the Impoundment Control Act of 1974 (31 USC 1403) deferring any such expenditure during the comdng fiscal year.

I am providllng a. copy of this letter to Seno&ltors Percy, Proxm:l.re, and Kasten.

Sincerely, RICHARD FAIRBANKS,

Assistant Secretary tor Congressional Relations.

Mr. BOSCHWITZ. Mr. President, the letter represents a good compromise in my judgment.

The Senator from Wisconsin is indeed correct, that to continue more funds to Syria at this time, when it is playing a spoiler role in the Middle East, would be inadvisable. It ls not quite clear whether Syria is playing a constructive role in Lebanon. As a matter of fact, as Senators may know, the Syrians have never recognized Lebanon. They have never had diplomatic relations with Lebanon. They have always considered Lebanon to be part of Greater Syria. Yet, they are in Lebanon and allegedly playing the role of peacemaker. However, in the eyes of many, they are in the role of occupier.

They continue to take a very hard line rejectionist view of the Middle East process, and they continue on the State Department's list of countries which are aiding and supporting international terrorism.

So I compliment the Senator from Wisconsin on his amendment, and I am pleased that it is withdrawn, in order to give the State Department some leverage, in order to give our Syrian friends the opportunity to do the things that we, in our country at least, believe would heighten the opportunity to be cooperative with them once again .

Mr. STENNIS. Mr. President, will the Senator yield?

Mr. BOSCHWITZ. I yield. Mr. STENNIS. Mr. President, I com

mend the Senator from Wisconsin for his


dWgence and his eftorts. He has already saved more than $100 m111ion.

I also commend the Senator from Minnesota for his interest in this matter. I hope they will follow up on this matter. It shows what can be done. We are lagging behind on work of this kind.

Mr. PROXMIRE. I thank the Senator from Mississippi.

I also thank the Senator from Minnesota. He and his staft really took the leadership in these negotiations with the State Department and deserve a great deal of credit for the leadership they have taken.

I wonder whether the Senator from Minnesota would be agreeable to joining in a request to the GAO to investigate and to tell us how much more we could save of the $350 million that we have earmarked for Syria, because we may have an opportunity later to increase this saving.

Mr. BOSCHWITZ. Let me first respond to the distinguished Senator from Mississippi.

'Ibis is the second year that I have had the privilege of joining with the Senator from Wisconsin in this particular effort. Hopefully the attitude that exists in the Middle East with respect to the Syrians will change so we will not have to do a third year, although we will if necessary.

I intend to 'concur with Senator PRoxMIRE that we should have such a GAO report to see what other moneys may be someWhat more committed illito the pipeline, and whether or not some of them can also be laid aside and saved.

Mr. PROXMIRE. I thank the distinguished Senator from Minnesota.

Mr. President, I withdraw the amendment.

The PRESIDING OFFICER. The amendment <No. 552) is withdrawn.


(Purpose: To require that not less than 15 percent or economic support fund. assistance which is allocated. to finance tlhe purchase or United. States commodities be available only for the purpose of financing the purchase or agricultural commodities)

Mr. ZORINSKY. Mr. President, I send an unprinted amendment to the desk and ask for its immediate consideration.


The b111 clerk read as follows: The ·Senator from Nebraska (Mr. ZoaiN

SKY), for himself and. Mr. BoscHwrrz, proposes an unprinted. amend.ment numbered. 456.

Mr. ZORINSKY. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.


The amendment is as follows: On page 21, 11ne 23, insert "(1)" immed1-

81tely after "(-a)". On page 22, between llnes 2 and. 3, insert

the folloWing: (2) Section 531 of such Act is amended

by adding at the end thereof the following: ''(cl) Not less than 15 percent of the funds

authorized. to be appropriated. for each fiscal year, pursuant to this chapter, which are &llocatecl under the Commod.l ty Import Program to finance the purchase of com-

mod.ities produced in the United States, shall be available only for the purpose of financing the purchase of agricultural commodities produced in the United. states.".

Mr. ZORINSKY. Mr. President, this amendment is intended to insure that a fair percentage of our AID-financed exports include agricultural commodities. Of the entire $2.4 billion ESF program, only $398 million is budgeted for the commodity import programs in Egypt and subsaharan Africa. Of this modest amount, my amendment would require that 15 percent of the financed commodities be agricultural goods and products from the United States. For fiscal year 1982, this would amount to $60 million.

The commodity import program was established by the Agency for International Development pursuant to section 635B of the Foreign Assistance Act, which allows the President to make available to friendly governments, loans, advances and grants.

Although AID does not have a precise breakdown of the present mix of agricultural and nonagricultural commodities which are financed through the CIP, it does have a breakdown of the largest program-Egypt.

Since 1975, the United States has provided $1.875 billion through the commodity import program for Egypt, 10 percent of which has been agricultural goods and products. In addition, another 13 percent of that program has financed commodities for human needs projects, including food stuffs, and materials for education and health programs.

I offer this amendment because of my firm conviction that our bilateral aid programs must provide demonstrable benefits not only tc the recipients of the aid provided, but also to U.S. citizens such as the American farmers whose tax dollars make the aid program possible.

Especially in this time of budget austerity, we must insure that every penny we authorize to be appropriated will prove a productive investment for the American economy. My amendment is designed to help provide just such assurances to the American taxpayer-that there will be a return on the foreign aid investment.

The CIP is currently a modest program, operating in some 12 countries. However, it is a program which may expand as time goes by. My amendment would place a floor on the portion used for agricultural commodities.

With the current agricultural surplus over $20 billion, it is absolutely imperative that our Government seek additional measures to promote the export of our agricultural commodities. With low price support levels forced on the Congress under threat of a Presidential veto our Nation's farmers are facing economic disaster.

Let me cite USDA's forecast for grain production:

As of September 1, national com production is forecast at a record high 7.94 billion bushels-19 percent more than 1 year ago-1980. And in my State of Nebraska, the forecast as of September 1, is 7,728 million bushels-28 percent above 1980 and the second largest corn crop of record.

Grain sorghum production nationallY as of September 1, is forecast at 864 million bushels-47 percent above 1980. In Nebraska grain sorghum production is expected to reach a record 166 million bushels-36 percent over 1980.

All wheat production nationally as of September 1 is forecast at a record high 2.75 billion bushels-16 percent more than 1980. Nebraska wheat production is expected to be down slightly from last year but that is not significant factor in light of the record national production.

Soybean production nationally is forecast at 2.09 billion bushels-15 percent above last year. In Nebraska, soybean production is forecast at a record 75.6 million bushels-42 percent above 1980 and 38 percent above the previous record year, 1979.

I am indeed proud of the production of our Nation's farmers. While the Federal Reserve Board justifies high interest and tight money to stimulate productivity, farmers are producing a record crop. This efficiency must not be allowed to put our farmers in an economic grave.

If we are not as a nation and as a Congress-willing to provide farmers adequate price protection-a need that we did not face up to in passing the farm bill, then we must help them find a market for their production.

My amendment simply provides that AID funds already allocated be used to increase farm commodity exports to the neediest nations.

Mr. BOSCHWITZ. Mr. President, I ask the distinguished Senator from Nebraska if I may join him as a cosponsor of his amendment.

Mr. ZORINSKY. I most certainly will be honored to have the Senator from Minnesota as a cosponsor of this amendment and so ask unanimous consent.


Mr. BOSCHWITZ. Mr. President, I believe this is a reasonable amendment and so state on behalf of the chairman of the committee.

Economic support funds have been made available to help politically important countries with :flexible economic assistance.

Certainly, a key problem in most recipient countries is the inability to produce adequate food for their people. This in turn presents short-term financial problems related to paying for imports of food and other agricultural commodities.

The amendment assures that a reasonable share of assistance provided through economic support funds will address the food problem with high quality American goods.

Mr. President, we are prepared to accept this amendment.

Mr. ZORINSKY. Mr. President, could we have a voice vote on the amendment?

The PRESIDING OFFICER. The question is on agreeing to the amendment of the Senator from Nebraska.


Mr. ZORINSKY. Mr. President, I move to reconsider the vote by which the amendment was agreed to.


Mr. BOSCHWITZ. Mr. President, I move to lay that motion on the table.


The PRESIDING OFFICER <Mr. SPECTER.) The Senator from New Hampshire is recognized.


(Purpose: To express the sense of the congress with respect to the use of, or the provision for use of, toxins or biological or chemical agents against the peoples of Laos, Cambodia, Afghanistan, and the Soviet Union)

Mr. HUMPHREY. Mr. President, I send to the desk an unprinted amendment and ask for its immediate consideration.



The Senator from New Hampshire (Mr. HUMPHREY), for himself, Mr. SYMMS, Mr. ARMSTRONG, Mr. ScHMITT, Mr. EAST, Mr. COHEN, Mr. DURENBERGER, Mr. PROXMmE, Mr. BOSCHWITZ, and Mr. RoTH, proposes an unprinted amendment numbered 456.

Mr. HUMPHREY. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.



the following: USE OF TOXINS OR BIOLOGICAL OR CHEMICAL

AGENTS SEc. 716. (a.) The OOngress hereby con

demns the use of, or the provision for use of, toxins or biological or chemical agents against the peoples of Laos, Kampuchea (Dambodia), Afghanistan, and the Soviet Union.

(b) It is the sense of the COngress that the President should, acting through the Permanent Representative of the United States to the United Nations or other appropriate diplomatic agents, seek definite measures to bring to an end actions by a.ny party or government in using, or providing for use, toxins or biological or chemical agents against the peoples of Laos, Kampuchea (Oambodia), Afghanistan, and the Soviet Union, in violation of the spirit or the provisions of-

(1) the Convention on the Prohibition of the Development, Production a.nd stockpiling of Bacteriological (Biological) a.nd Toxin Weapons, done at Washington, London, a.nd Moscow on April 10, 1972;

(2) the Protocol for the Prohibition of the Use in War of Asphyxiating, Poisonous or Other Gases, a.nd of BacteriologicaJ. Methods of Warfare, signed at Geneva on June 17, 1925; or

(3) customary international law. (c) It is further the sense of the Congress

that the President should vigorously seek a satisfactory explana.tion from the Government of the Soviet Union regarding the strong circumstantial and presumptive evidence of the use of, or the provision for use of, toxins or biological or. chE'!-mi011-l al!<>nts by the Government of the Soviet Union against the peoples of Laos, Cambodia (Kampuchea), Afghanistan, a.nd the Soviet Union.


Mr. HUMPHREY. Mr. President. I ask unanimous consent that the following Senators be added as cosponsors of the amendment: Mr. SYMMS, Mr. ARM-·

STRONG, Mr. SCHMITT, Mr. EAST, Mr. COHEN, Mr. DURENBERGER, Mr. PROXMIRE, Mr. BOSCHWITZ, and Mr. ROTH.


Mr. HUMPHREY. Mr. President. On September 13, Secretary of State Alexander M. Haig, Jr., announced in Berlin that the United States now has physical evidence of the use of toxic substances in Southeast Asia. This substantiated reports of chemical weapons use that have emanated from Laos and Cambodia since the mid-1970's. Thousands of people, primarily the Hmong of Laos, have suffered terrible deaths and many more have endured unbelievable pain and anguish after exposure to these toxins. It is believed that similar agents have been used against the people of Afghanistan and indeed may have been employed during the Yemeni Civil War in 1966-67.

The resolution I have introduced condemns the use and supply of biological and chemical agents, and toxins, and it calls upon the President to promptly seek steps, in accordance with the terms of the Geneva Protocol and the Biological Weapons Convention to end this unlawful and inhuman activity. The resolution also urges the President to seek an explanation from the Soviet Union as to its role in the administration of these agents. All indications are that the Soviet Union is responsible for both the production, and the dispersal, of these heinous poisons.

It is imperative that the administration follow through with the initiative begun in Berlin. For too long, much of the world has stood by impassively as horror stories regarding the application of chemical agents appeared with increasing frequency. He must press the issue lest those powers using these weapons perceive our inaction as indifference, or worse, as tacit approval of their work.

Two recent editorials, one from the September 21, 1981, the Wall Street Journal entitled "Yellow Rain and Arms Control," and another from the September 15, 1981, the Washington Post entitled "Yellow Rain" stressed the importance of pursuing the claims raised by Secretary Haig.

Mr. President, I ask unanimous consent to have printed in the RECORD the full texts of the two editorials.

There being no objection, the editorials were ordered to be printed in the RECORD, as follOWS: [From the Wall Street Journal , Sept. 21 , 1981]

YELLOW RAIN AND ARMS CONTROL For some time we have been hearing from

disarmament enthusiasts that if only the West would slow down its side of the arms race, the Soviets might be induced to do likewise. Each new weapon we deploy simply invites an equivalent response from the other side, it's argued. The sensible course is to make a gesture of good faith and enter into negotiations.

We got to thinking about this line of reasoning, so popular in Europe today and to some extent even in this country, because of this week's meeting at the United Nations between Secretary of State Haig and Soviet Foreign Minister Gromyko. The two are scheduled to fix a time and place for the start o! negotiations on theater nuclear weapons in Europe. We agreed with our allies to seek

such talks as the price for installing more effective medium-range nuclear weapons 1n Europe to counteract the big Soviet SS20s being deployed in large numbers in Warsaw Pact countries.

We also got to thinking about it because of the disclosure by Mr. Haig last week in West Berlin of evidence that Soviet-supplied toxins are being used to annihilate insurgents and tribespeople in Southeast Asia a.nd possibly Afghanistan. It seems to us that this development has some rather stark and ugly implications for those who think arms control 1s something to be worked out among nice guys 1! only our guys try a little harder.

For years there have been reports o! some form of chemical warfare in Laos, Cambodia and Afghanistan. Refugees from these areas often referred to a "yellow rain" sprayed from helicopters and airplanes that would cause a rapid and agonizing death from blistering, vomiting, violent convulsions and massive hemorrhaging. Asian Wall Street Journal correspondent Barry Wain was one of the first to take these reports seriously; in a forthcoming book about Indochina's refugees, "The Refused," he concludes that the Comxnunists have tried to exterminate rebellious hill people in Laos with some sort of chemical agent. (Also see Mr. Wain's dispatch on this page today.)

And author Sterling Seagrave, who started out to write about American abuses of chemical and biological warfare, winds up concluding in his new book, "Yellow Rain," that the Soviets have been using chemical wa.rfare on a massive scale. He estimates casualties in the tens of thousands in Yemen, Laos, Cambodia and Afghanistan and theorizes that the Soviets have used these conflicts to "experiment" with their vast arsenals of deadly chemical and bacteriological weapons.

But it remained unt.U last week's disclosure to give official credence to such reports. Until then it had been easy to shrug off the horrifying rumors simply because they were so horrifying. The symptoms described by eyewitnesses to reporters and medical teams didn't seem to fit the effects of the usual chemical or biological weapons.

Laboratory analysis of a foliage sample, however, showed the presence of massive doses of mycotoxins, fungal poisons whose effects exactly fit the refugee reports. Mycotoxins don't occur naturally in Southeast Asia. What's more, Soviet scientists are known to have had a long and deep interest in mycotoxins, which sometimes in-fected badly handled wheat stocks and

caused seyeral large outbreaks of poisoning in the Soviet Union in the 1930s and early 1940s. Mr. Seagrave's book discusses the matter in fascinating and convincing detail.

The single leaf-and-stem foliage sample produced by the State Department seemed scanty evidence on which to rest a charge of major war crimes. But intelllgence

sources say that more proof is on the way in the form of other samples, pathology reports and satellite photo evidence of Soviet CBW units in action. Doubtless there will be an effort, as with the El Salvador White Paper. to discredit the charges. Just as minor inaccuracies couldn't hide the basic truth of the subversion effort in El Salvador, however, we shouldn't allow bureaucratic haste and intelligence agency discretion to obscure the forest for the trees in this matter. The accumulated evidence is just too strong to any longer blink what's going on.

That given, we need to start thinking hard about the implications. One would be whether the U.S. needs to reconsider its unilateral ban on development of chemical and biological weapons of its own. Even more important, however, we should think anew about the nature of the enemy we confront. The widespread notion that the Sdvtets only

22572 CONGRESSIONAL RECORD-SENATE September 30,. 1981

arm themselves because we arm ourselves stands exposed for what it is: naivete at best. i

It was after we were committed to d s-ma.ntling our CBW stockpiles that the Soviets unrepenta.ntly stepped up their own efforts. And this, too, we must remember: The Soviets and their allies are killing people with this stuff.

so it's disappointing to us that the administration isn't now following up on its own strong lead. We trust it's only because washington is waiting to make an even stronger case. In the meantime, the U.S. should insist that the United Nations conduct on-site investigations under the Geneva. Protocol and a 1972 convention on chemical and bacteriological warfare to which the Soviets are a signa tory. Mr. Ha.ig should put Mr. Gromyko on notice that Soviet violations of its treaty commitments on chemical warfare bode ill for meaningful negotiations on nuclear arms. And no opportunity should be lost to make the point to our friends that, once again, Western good faith has been returned by Soviet duplicity and barbarous behavior.

[From the Washington Post, Sept. 15, 1981) "YELLOW RAIN"

It was an odd spectacle in Berlin on Sunday. There were tens of thousands of demonstrators, organized by the youth wings of the parties in West Germany's ruling coalition, throwing rocks and wielding axes and painting the Reagan administration as the enemy of peace for its nuclear pollcies. And there was also Secretary of State Haig, pleading that the United States not be held to a "super-critical standard" while the Soviet Union and its cllents are given virtually a free pass in Afghanistan and Kampuchea. Mr. Ha.ig was making a. telling point. Or rather, the crowd was making it for him. Certainly the demonstration puts a burden on the leaders of Germany's "silent majority" to make clear to Americans that tactical disagreements are not sapping the fundamental Atlantic tie.

That was not all there was to brood on in Berlin. Getting specific, Secretary Haig observed that even as the United States is accused of delay on nuclear arms control, "others"-clearly he meant Moscow and its friends-seem to be violating the agreement signed in 1972 to ban biological weapons, Including so-called toxins, which are poisonous chemicals produced by biological organisms. He referred to new findings, disclosed in greater detail at the State Department yesterday, suggesting that the deadly "yellow rain" visited on those struggling against communist invaders in Laos, Kampuchea and Afghanistan in recent years was an act of biological warfare. The findings center on high levels of potent mycotoxins, which are produced neither by Indigenous organisms nor by any known fac111ties In those countries.

The track record of this and recent administrations makes it inevitable that these allegations will be treated skeptically in many quarters. This is especially so since the administration characterizes its own evidence ambiguously as "sig-nificant" but "preliminary." It is sending its material to various governments and to the experts who had already been assigned to investil!'ate charges of chemical warfare at the United Nations.

This is fine as far as it goes. Chemical warfare is bad enoue"h. but it would be unspeakable if the Soviet Union were actually conductinl!' and sponsoring biological warfare. That would be violating an international commitment and setting a loathsome precedent. But whv stoo with pasRine: on the evidence to thos"! U.N. exoerts? They were set at work at a time when it was thought that the offense was chemical warfare. Now it is thought to be biological. and the biological

warfare "convention .. allows complaints to be taken to the more politically resonant Security Council. A common rap on arms control agreements is that they are not sufficiently enforceable. So why pass by the enforcement procedure of the biological warfare convention? Let American evidenc~and Soviet conduct-be examined by experts and displayed in a polltical forum as well.

Mr. HUMPHREY. Mr. President, it has long been suspected that the Soviet Union and its allies had made provisions for the use of, and had administered, chemical weaponry. As early as 1966, a U.S. military attache in Saudi Arabia, Lt. Col. James Barrett, was dispatched to Yemen to collect blood and tissue samples from victims of gassing during the civil war there. In 1967, there appear to have been numerous attacks against Saudi-backed royalist followers of the ousted Imam of Yemen, Mohammed Al-Badr. Mounting evidence that the United Arab Republic, utilizing Soviet-built Dyushin-28 jet bombers, was employing poison gas led the International Committee of the Red Cross <ICRC> to charge in a report dated May 21, 1967, that people had, indeed, been killed in UAR chemical attacks. The close relationship between the UAR and the Soviet Union, underscored by the aircraft used to deliver the weapons, hinted as to the source of the chemical agents.

Since the mid-1970's, innumerable reports in the press and comprehensive documents such as "Reports of the Use of Chemical Weapons in Afghanistan, Laos, and Kampuchea," prepared by the U.S. Department of State in July 1980, have outlined incidents that strongly suggested the use of chemical weapons in Asia. In Laos, thousands of people are believed to have died in genocidal attacks that featured chemical agents. In Kampuchea, forces fighting the Vietnamese occupation are. believed to have been exposed to similar poisons. Finally, Afghans fighting the Soviet invaders of their country have claimed that chemical weapons have been used against their people.

In 1979, the Pentagon sent a team of doctors, headed by Col. Charles Lewis, chief of dermatology at the Brook Army Medical Center in San Antonio, Tex., to Southeast Asia. Their mission was to determine what, if any, chemical agents could produce the terrible symptoms of exposure-convulsions, blistering, and hemorrhaging-attributed to the weapons by victims of the assaults. A long investigation has now concluded that the agents are mycotoxins, especially virulent poisons produced by the fusaria fun·gus. The toxins, from the tricothecene group, were identified as T2, nivalenol, and deoxynivalenol. These odious agents inflict a most painful death and survivors endure prolonged su1ferin·g.

We can no longer ignore the issue before us. Certain nations, specifically the Soviet Union, Laos, and Vietnam, are flaunting customary international law in their use of chemical weapons. This hideous aggression must be stopped immediately. Less than a year and one-half ago, this body unanimously passed a resolution offered by the Senator from Wisconsin (Mr. PROXMIRE) pertaining to Soviet compliance with the Biological

Weapons convention in light of" the outbreak of anthrax in the city of Sverdlovsk. Many of us were shocked at w~at appeared to be cl€a~ evidence o~ Sov1et action in contravent10n of the BlOlogical Weapons Convention. It seems equa~y clear to this Senator that the Sov1et Union continues to act in disregard. of both the Biological Weapons convent10n and the Geneva Protocol, and that many lives have been lost as a result.

A u .N. inquiry, begun at the end of last year has made little headway in its effort to m'vestigate charges of chemical weapon use. Should the United States fail to sustain the drive to expose the use of chemical weaponry then certainly the use of these agents will continue. If we do not attempt to verify and enforce compliance with the terms of the agre~ments controlling biological and chemlcal agents and toxins, then why should the American people or, for that matter, anyone in the free world, place any faith in more comprehensive arms control negotiations? We have an obligation to ourselves, to those that have suffered, and to those suffering today, to do everything W'ifthlin our power to halt the illegal and cruel use of chemical weapons.

Mr. President, I intend to ask for a rollcall vote on this amendment. However, in order to call in Senators who may be some distance from the floor, unless others have business to transact-and I do not suppose they can since this is pending without unanimous eonsent-I am going to put in a quorum call at this time. I suggest the absence of a quorum-! withhold that for a moment. I yield to the Senator from Nebraska.

The PRESIDING OFFICER. The Senator from Nebraska.

Mr. ZORINSKY. Mr. President, if there is no objection from the Senator from New Hampshire, I do have an amendment I would like to propose. Does the Senator have any idea how long he would anticipate holding up his amendment during the quorum call?

Mr. HUMPHREY. Just a few minutes before I ask for the yeas and nays.

Mr. ZORINSKY. May I ask, Mr. President, the Senator from New Hampshire if he would consider laying aside his amendment and allowing me to proceed with mine or would he rather not do that?

Mr. HUMPHREY. I would be perfectly willing to do that, I would be perfectly agreeable to that.

Mr. ZORINSKY. I will be asking for the yeas and nays on my amendment, but I did not want to preclude the time involved in the Senator's amendment unless he was willing to do that.

Mr. HUMPHREY. I would welcome a unanimous-consent agreement or the Senator may make it if he wishes and perhaps we can put the votes back to back, subject to the desires of the chairman of the Committee on Foreign Relations.

Mr. ZORINSKY. Mr. President, I ask unanimous consent to temporarily lay aside the amendment of the Senator from New Hampshire.

The PRESIDING OFFICER. Is there

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22573 objection? The Chair hears none, and it is so ordered.


<Subsequently numbered amendment No. 571.)

Mr. ZORINSKY. Mr. President, I send an unprinted amendment to the desk and ask for its immediate consideration.



The Senator from Nebraska. (Mr. ZoRINSKY) proposes an unprinted amendment numbered 457.

Mr. ZORINSKY. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.



the following new section 716 and renumber the subsequent section accordingly:

SEc. 716. Notwithstanding any other provision of law, of the funds authorized to be appropriated to carry out this Act for the fiscal year 1982, $10,000,000 under part I and $20,000,000 under chapter 4 of part II of this Act shall be available only for Nicaragua under the following conditions-

(a.) all of the funds made available to Nicaragua. shall be furnished solely for assistance to the private sector in Nicaragua;

(b) the provisions of subsection (a.) shall not apply when the President determines and reports to the Speaker of the House of Representatives and the Chairman of the Committee on Foreign Relations of the Senate, that Nicaragua has made subsrtantial progress toward free and fair elections;

(c) for each a-month period in which any funds a.re expended under this Act for Nicara.gua, the President shall submit to the Speaker of the House of Representatives and the Chairman of the Committee on Foreign Relations of the Senate a. report accounting fully and in itemized detail for the amounts obligated and actually expended in Nicaragua.

Mr. ZORINSKY. Mr. President, I ask for the yeas and nays on the amendment.

The PRESIDING OFFICER. Is there a sufficient second? There apparently is a sufficient second.

The yeas and nays were ordered. UP AMENDMENT 458

(Subsequently nwnbered amendment No. 572.)

Mr. ZORINSKY. Mr. President, I send a perfecting amendment to the desk and ask for its immediate consideration.



The Senator from Nebraska (Mr. ZoRINSKY) proposes a.n unprinted amendment numbered 458.

Mr: ZORINSKY. Mr. President, I ask unammous consent that further reading of the amendment be dispensed with.


The amendment is as follows: On the amendment proposed by Mr. Zorin

skv. strilre out the figure "$10,000.000" and insert in lieu thereof the figure "$13,275,000."

Mr. ZORINSKY. I ask for the yeas and nays on the perfecting amendment.

The PRESIDING OFFICER. Is there

a sufficient secohd? There appears to be a sufficient second.

The yeas and nays were ordered. Mr. ZORINSKY. I thank the Chair. Mr. President, in July, I expressed my

deep-felt concerns over the state of the political situation in Nicaragua. I was reacting to what I saw was increasing Government pressure on the press and and on the church, as well as to a belief th'at the Government was not moving with very much resolve toward direc·t, democratic elections.

I said at that time that-When the Nicaraguan leadership rededi

cates itself to the principles of economic and poUtical pluralism, when there is a. renewed dedication to free and direct elections, when the church can function without hindrance, when the press can publish in an atmosphere free of intimidation, I once again will proudly stand in these halls to support assistance to the Government of Nicaragua.

Today, on the occasion of the debate on the foreign aid bill, in the interest of helping to keep alive Nicaragua's hope for economic and political pluralism, I want to introduce this amendment. It calls for earmarking the assistance that is provided Nicaragua for the use of the private sector. This amendment covers development assistance and economic support funds only. Public Law 480 programs are not affected by this measure.

A13 provided in my amendment, when the President can certify that the Nicaraguan Government has made substantial progress toward free, direct, and fair elections, then economic assistance can be directed toward the Government itself.

The amendment also requires an accounting for the expenditure of the funds in Nicaragua. I have not been able to determine precisely how our money has been used in the past. This would require a quarterly report itemizing the amounts obligated and actually expended in Nicaragua, so that the Congress can review completely, and on a regular basis, the use of U.S. tax dollars in Nicaragua.

Mr. President, earlier in the consideration of this foreign aid bill, we have set a precedent by the earmarking of funds for Costa Rica. This amendment does nothing more and nothing less than what this body has already sanctioned in other areas of concern with respect to Latin America. I hope that my colleagues will join me in this amendment because we must continue to support the Nicaraguan private sector in its efforts to maintain a mixed economy and political pluralism. I urge my colleagues to support this hope for democracy in Nicaragua.

Mr. HUMPHREY addressed the Chair. The PRESIDING OFFICER. The Sen

ator from New Hampshire. Mr. HUMPHREY. Mr. President, I ask

unanimous consent that it be in order that the yeas and nays be requested on the unprinted Hwnphrey amendment at this time.

The PRESIDING OFFICER. Is there objection? Without objection, it is in order to order the yeas and nays at this time.

Mr. HUMPHREY. Mr. President, I ask for the yeas and nays.

The PRESIDING OFFICER. Is there a

sufficient second? Apparently there is a sufficient second.

The yeas and nays were ordered. Mr. ZORINSKY. Mr. President, I sug

gest the absence of a quorum. The PRESIDING OFFICER. The clerk

will call the roll. The assistant legislative clerk pro

ceeded to call the roll. Mr. ZORINSKY. Mr. President, I ask



Mr. ZORINSKY. Mr. President, I ask unanimous consent that we lay my amendment aside and go to the amendment of the Senator from New Hampshire, with the understanding that my amendment will then be the pending business after his amendment.

The PRESIDING OFFICER. Without objection, the two amendments of the Senator from Nebraska will be set aside.

Mr. PERCY. Mr. President, reserving the right to object, I would say to my distinguished colleague, a member of the Foreign Relations Committee, who I know will want to cooperate with the managers of the bill in moving things ahead, that it is possible that we could have by the end of this rollcall a sufficient analysis of the Zorinsky amendment with respect to Nicaragua to be able to debate it and to proceed. But, not having seen the amendment until just a few moments ago, having no idea such an amendment was coming up, we have not had an opportunity to do proper staff work. We have not been able to give the administration an opportunity to comment on it so that they can tell us what the implications are and what the language means; $10 million can solely be given to the private sector. In what way? How? What implications does that have? We need that analysis.

I would hope that we would not delay the work that can be accomplished tonight and move ahead with as much dispatch as we can in other areas, absolutely assuring and guaranteeing the Senator, a member of our committee, that we would not proceed to finish this bill until adequate time had been taken on the floor to have, if necessary, an upor-down vote on the Zorinsky amendment with respect to Nicaragua.

I have no objection to it being the pending business, but if the managers of the bill see an opportunity to take up another amendment and dispose of it, and still have not been able to get a sufficient analysis to be able to intelligently approach this amendment, I would hope the Senator would continue the practice of permitting us to go ahead with other business, reserving his right to have his amendment the pending business after that agreement has been reached.

Mr. ZORINSKY. Would the chairman of the Foreign Relations Committee. my esteemed colleague, for whom I have a great deal of respect, offer me the opportunity to lay aside my amendment as the pending business, in the event that additional business can be considered in advance of it, but with the assurance


that eventually this evening, I will have an up-or-down vote on my amendment? . Mr. PERCY. The chairman of the

committee cannot guarantee that we would have a vote tonight. Once this measure is set aside for the continuing resolution, we do not know whether the night will have been exhausted, the New Year's Eve celebration on the new fiscal year will be over, and we are still on the continuing resolution. But the chairman and the ranking minority Member can absolutely guarantee that the Senator's amendment can be the pending business, that we will continue to come back to the Senator and ask him to set it aside, explaining what we have to accomplish and why we have not yet been able to deal with the Zorinsky amendment.

As soon as we have completed our analysis as to what the implications are, then we will certainly want to take up the Zorinsky amendment. There is no reason to delay.

Mr. ZORINSKY. There is no time agreement on the bill itself, and inasmuch as I have been in this Chamber many evenings to very late hours, I am willing to set aside my amendment until such time as the Senator runs out of the amendments that are offered to the bill. But today, tonight, or tomorrow I would like to be assured of a vote on my amendment. I am willing to stay here as long as it takes for the chairman to run out of less controversial items or other business so that my amendment once again can become the pending business. At the end of that period of time, even if it is 2 or 3 in the morning, I would like to have a vote on my amendment.

Mr. PERCY. We do not know how long the continuing resolution will take. That is beyond our control. We know that both of us are required here. Hopefully we will be through the continuing resolution so we can start our closed session with Secretary Haig at 9 a.m. in the morning. If it is possible to get through the Zorinsky amendment and if the leadership wishes to stay in session to do so, I, for one, would be willing to do so. All I can really guarantee the distiguished Senator is that this bill will not be completed until there has been adequate time to fully debate the Zorinsky amendment and have an up-or-down vote on the Zorinsky amendment.

Mr. ZORINSKY. Mr. President, what is the pending business?

The PRESIDING OFFICER. The pending business is the amendment in the second degree offered by the Senator from Nebraska to the original amendment.

If the Senator agrees to set aside his amendment---

Mr. ZORINSKY. Mr. President, I would have to withdraw my unanimousconsent request if I am not afforded the opportunity for a vote on my amendment this evening, after we dispose of all the business pertaining to this bill. I will object.

The PRESIDING OFFICER. Objection is heard.

Mr. PERCY. Let me make this suggestion. It is that we proceed with the Humphrey amendment vote; that we

then take up, immediately after that, the Zorinsky amendment. Staff feels that within 15 minutes we can have su:fficient information from the Department to analyze and discuss it then. Only if we appear to not be getting down to the heart of the matter enough to actually vote, I would then ask, if we have any other business, if the Senator from Nebraska would set aside his amendment temporarily, without losing his right, and have it then become the pending business. I think we should proceed to the vote and bring the Zorinsky amendment up as the pending business immediately after that vote.

Mr. ZORINSKY. Is it my understanding that the chairman of the committee would then have to get unanimous consent once again to lay my amendment aside?

Mr. PERCY. That is correct. That is my understanding of the parliamentary procedure.

A parliamentary inquiry, Mr. President.

The PRESIDING OFFICER. The Senator will state it.

Mr. PERCY. Is it not true that if we go ahead with the vote on the Humphrey amendment the pending business would be the Zorinsky business and unanimous consent would have to be asked and obtained in order to set aside the Zorinsky amendment and take up any resolution.

Mr. ZORINSKY. When the continuing resolution becomes the pending business, my amendment would become the pending business immediately after that.

Mr. PERCY. If the amendments are set aside and the Senate turns to the Humphrey amendment, then at that point, the Zorinsky amendment, upon the disposal of the Humphrey amendment, would be the pending business before the Senate automatically.

Mr. ZORINSKY. It would require unanimous consent to lay my amendment aside at that time?

The PRESIDING OFFICER. For consideration of other nonprivileged business.

Mr. ZORINSKY. I will agree to that. Mr. PERCY. I suggest we vote on the

Humphrey amendment. The PRESIDING OFFICER. Is there

then a request to set aside the Zorinsky amendment? As yet there has been no such request.

Mr. PERCY. I ask unanimous consent that the Zorinsky amendment be set aside so that we may vote on the Humphrey amendment, after which the Zorinsky amendment will be the pending business.


Mr. HUMPHREY. I am ready to vote. UP AMENDMENT NO. 456

The PRESIDING OFFICER. The question is on agreeing to the amendment of the Senator from New Hampshire. If there is no further debate, the yeas and nays having been ordered, the clerk will call the roll.

The assistant legislative clerk called the roll.

Mr. STEVENS. I announce that the Senator from North Carolina <Mr. EAST) , the Senator from New Hampshire (Mr. RUDMAN) , and the Senator from Connecticut <Mr. WEICKER) are necessarily absent.

Mr. CRANSTON. I announce that the Senator from Virginia <Mr. HARRY F. BYRD, JR.), the Senator from Nevada <Mr. CANNON), the Senator from Louisiana <Mr. LONG), the Senator from Hawaii (Mr. MATSUNAGA), and the Senator from New York (Mr. MOYNIHAN) are necessarily absent.

The PRESIDING OFFICER. Are there any other Senators in the Chamber who desire to vote?


[Rollcall Vote No. 301 Leg.] YEA8-92

Abdnor Glemrn Andrews Goldwater Armstrong Gorton Baker Gressley Baucus Hart Bentsen Hatch Blden Hatfield Boren HJ\wkln.s Boschwltm Hayakawa Bradley Hetlln Bumpers Heinz Burdick Helms Byrd, Robert C. HC\llings Cha!ee Huddleston Chiles Humphrey COchran Inouye Cohen Jack90n Cra.nston JepBelll D'Amato Johnston Danforth Kassebaum DeConcini Kasten Denton Ke~dy Dixon Laxal t Dodd Leahy Dole Levin Domenlcl Lugar Durenberger Mathias Eagleton Mattllllgly Exon McClure Ford Melcher Ge.rn Metzenbaum

Ml<bchell Murk.owskl Nickles Nunn Packwood Pen Percy Pressler Proxm1re Pryor Quayle Randolph Riegle Roth Bar banes Sasser Schmitt Simp90n Specter Stafford Stennis Stevens Symma Thurmond Tower Tsongas Wallop Warner Williams Zorln.sky

NOT VOTING-8 BYTd, East Moynihan

Harry F., Jr. Long Rudman Oa.nnon Matsunaga Weicker

So Mr. HUMPHREY'S amendment (UP No. 456) was agreed to.

Mr. HUMPHREY. Mr. President, I move to reconsider the vote by which the amendment was agreed to.

Mr. ROBERT C. BYRD. I move to lay that motion on the table.


Mr. HAYAKAWA. Mr. President, I support s. 1196, to extend the operating authority of the Overseas Private Investment Corp.

Recently, during one of my periodic discussions with California business leaders, I had the opportunity to discuss OPIC and what the OPIC programs mean to American businessmen. I can report to my colleagues that these businessmen-representing both large and small businesses-told me quite frankly that OPIC was a very important and valuable organization in helping them take advantage of new business opportunities in the developing nations of the world.

In fact, many of these executives stated that their companies simply would not be able to do business in many of the developing countries without the assist-

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22575 ance and encouragement they receive from the OPIC programs.

What I heard from both large and small businesses alike was a strong endorsement for an obviously respected organization.

Mr. President, small business and cooperatives need all the practical support we can give them. Without it, they will continue to be insignificant participants in international trade and investment. They will have to forego important growth opportunities which international business offers.

Four years ago, when we last considered the OPIC legislation, we assigned to the Corporation a special task: To provide extraordinary services to U.S. small business and cooperatives. The Congress instructed OPIC to give preferential consideration-highest priority-to projects involving U.S. small business and cooperatives, which they have done. Congress set a goal for OPIC: To raise the number of projects involving small business and cooperative investors to 30 percent of the total number of projects supported.

OPIC responded promptly and effectively to our directive and increased the percentage of its activity involving small business to meet our 30 percent target. As part of this effort, OPIC management launched a systematic communications program to tell small business executives how to get involved in international business and how to get the most mileage out of the OPIC programs. OPIC sponsored or cosponsored daylong conferences in some 60 American cities across the country attended by over 12,000 people.

OPIC has made it possible for small businesses to obtain OPIC political risk insurance through their own local insurance broker.

From 1977-80, OPIC's small financing department committed 27 loans to small business projects while assisting 18 smaller investors to conduct feasibility studies for new projects.

In addition, 50 special loans, grants or loan-grant combinations were made to help develop or implement small business projects.

This latter effort involved an OPIC contribution of about $3 million. OPIC also funded the expansion of two U.S. private voluntary organizations which relend funds to very small entrepreneurs in Central and South America, Indonesia and Kenya.

These are not huge numbers, Mr. Chairman, but to those who are starting out in a developing country, trying to establish productive enterprises on a sound financial basis, OPIC is important. Where else could they obtain the longterm commercial loans, political risk insurance, and guidance they require?

These numbers are an important index of achievement, but perhaps the recent testimony of small business executives before the Senate Foreign Relations Committee summarizes best the importance of OPIC. One small businessman said:

We have the knowledge, the fiexib1Uty, but we need help. Regardless of what private fl.nancial institutions may say, the fact is that sources of finance for small companies

willing to invest overseas are almost nonexistent.

He went on: OPIC's fl.nancing program is the only one

I know capable of meeting the needs of a small U.S. company that wants to protect or expand it overseas market by investing in a foreign country. To my knowledge, OPIC is also the only U.S. Government agency realizing both a developmental and trade support function without costing a penny to the American taxpayer.

An executive of another smaller company said the same thing-

In truth, we never would have ventured overseas without the protection of the Overseas Private Investment Corporation. Our small company is now an important factor in improving diets in fl.ve developing countries. I feel that this is one of the fl.nest government programs for real assistance to the developing world. It is practical; it is altruistic; it benefits others while benefiting the United States .... a great organization doing a valuable job.

Government programs do not often generate such high praise. I urge all the Members to get behind OPIC and support it with a favorable vote.

CONTINUING APPROPRIATIONS, 1982-CONF'ERENCE REPORT

Mr. BAKER. Mr. President, as I announced earlier, it is the intention of the leadership to proceed to nhe consideration of the conference report on the continuing resolution as soon as it is available. It is now available.

I ask unanimous consent that the foreign assistance bill be returned to the calendar and that the Chair lay before the Senate the message from the House of Representatives.

The PRESIDING OFFICER <Mr. STEVENS). The report will be stated.

The legislative clerk read as follows: The committee of conference on the dis

agreeing votes of the two Houses on the amendments of the Senate to the b1ll (joint resolution H.J. Res. 325) making continuing Sippropriations for the fiscal year 1982, and for other purposes, having met, after full and free conference, have agreed to recommend and do recommend to their respective Houses this report, signed by a majority of the conferees.

The PRESIDING OFFICER. Without objection, the Senate will proceed to the consideratti.on of the conference report.

<The conference report is printed in the House proceedings of the RECORD of today.)

Mr. BAKER. May we have order, Mr. President?

The PRESIDING OFFICER. The Senate will be in order. Senators will please take their seats.

Mr. BAKER. Mr. President, if I may have the attention of the Senate for a moment, it is now 2 minutes after 11 o'clock.

The next order of business will be debate on the conference report itself.

I expect there will be a vote on the conference report. I am prepared to address that question on a voice vote. If there is a demand for a rollcall vote, of course, we will have it.

There are items in disagreement that have been amended by the House of Rep-

resentatives which will have to be dealt with after the conference report is dealt with.

I urge all Members to consider that we need to do this before 12 o'clock tonight. We have less than an hour.

So I urge Members to forebear lengthy debate on this issue and to forebear asking for rollcall votes unless that is absolutely necessary.

Mr·. President, I yield the floor. The PRESIDING OFFICER. Who

seeks recognition? Mr. EXON. Mr. President, I wish to in

quire, if I could, from the managers of the bill what changes were made in the conference committee, what specifically, I ask, was the disposition of what I understood was a movement on the House side to provide for a 4.8 percent salary increase for Members of Congress if not retroactive some time in the future. I wish an explanation of that feature of the conference report.

Mr. HATFIELD. Mr. President, what is the pending business?

The PRESIDING OFFICER. The conference report on the continuing resolution is the pending business.

The Senator from Nebraska has the floor and has addressed a question to the manager of the bill.

Mr. HATFIELD. Mr. President, I wonder if the Senator from Nebraska will permit me to make a brief opening statement that may answer some questions and then get into this in an orderly way?

Mr. EXON. I am happy to yield under that condition to my friend from Oregon.

That is a key question in the mind of at least this Senator, and I hope he wm explain it.

Mr. HATFIELD. Mr. President, the committee of conference on House Joint Resolution 325, the continuing resolution for fiscal year 1982, met Monday afternoon and again today to resolve the differences between the two Houses. The conference report reflects agreement on 41 of the 47 Senate amendments, the remaining 6 being reported in technical disagreement as required by the rules of the other body.

The rate of expenditure provided for the HOD-Independent Agencies Appropriation Act (H.R. 4034) is that provided for in the conference agreement on that bill, until November 20.

The rate provided for the Treasury, Postal Service, and General Appropriation Act <H.R. 4121) is at the lower of the rate provided in the House- or Senate-passed bill, the Senate having deemed its reported bill as having been passed by the Senate.

Funding for projects and activities in the Defense and Foreign Operations bills is at the current rate or the budget estimate, whichever is lower.

Projects and activities in the legislative appropriation bill including Senate items are provided for the full fiscal year.

The rate of expenditure for the remaining nine bills is the lower of the House passed or the current rate, the House having d~med passed its LaborHHS bill as reported.

The expiration date for the resolution is November 20, 1981, the date set bY the Senate.


The House accepted a number of Senate amendments added to accommodate special circumstances, including the NOAA airplane purchase, CSA closeout costs, impact aid, and the limitation on Senate staff' and office buildings.

I should observe that the House did not agree to the Senate amendment relative to pay adjustments for civil service employees at executive levels m, IV, and V. The Senate amendments on honoraria and living expenses were taken back to the House in disagreement, and agreed to on separate votes, as were the other four amendments in disagreement. So now if we adopt the conference report and concur in the further House amendments to the senate amendments, we can complete action on this measure. Given the hour, I hope we can do so quickly.

Mr. President, let me explain the parliamentary situation we have at this particular time.

The House of Representatives has acted on the conference report, and the first motion that would be made would be to adopt the conference report and then there are three amendments that the House of Representatives modified. Three Senate amendments will have to be handled separately.

Those three amendments deal with the question of bridging the gap for the program relating to the elderly people.

The second one relates to the question of the moneys that were added to the appropriation measure and further modified by the House of Representatives for the peacekeeping forces in the Sinai.

The third has to· do with the amendment off'ered by the Senate dealing with honoraria.

That is the procedure that I understand and if I could have the attention of the Parliamentarian-Mr. President, may we have order in the chair?

The PRESIDING OFFICER (Mr. WARNER). The Senator from Oregon.

Mr. HATFIELD. Mr. President, a parliamentary inquiry.

The PRESIDING OFFICER. The Senator will state it.

Mr. HATFIELD. Mr. President, it is my understanding in infonnal discussions with the Parliamentarian that we would call up the conference report for the question on adoption, and following that, we would then be faced with three amendments that are in disagreement or in technical disagreement with the House of Representatives, and we would then have to handle those three amendments separately.

I identified them on a sheet of paper that I received from the majority leader as one dealing with the elderly feeding, second, the Sinai troops, and third, the honoraria.

Mr. President, is that a correct interpretation of the parliamentary situation?

The PRESIDING OFFICER. I am informed there are six amendments in disagreement.

The amendments in disagreement are numbered 16, 31, 36, 43, 44, and 46.

Mr. HATFIELD. Mr. President, let me delineate, then, between the three and six number.

Three of them are strictly technical in the sense that they are merely changing in the sections dealing with the continuing resolution.

There are three substantive amendments that I have enumerated already.

So I think thrut still places us where I had originally described the situation in the substantive area.

Mr. President, let me just briefly outline these three amendments of substantive character because I know that some Senators have indicated they would like to know a little bit more about these amendments before they vote on the question of adopting the conference report.

First of all, we had a situation in the program relating to feeding of the elderly that we would have a hiatus between the date ending for the continuing resolution and the present program.

So again it was merely a bridging of the continuity of this program. ·

I do not think that there was any controversy in that amendment as it relruted to the conference committee in the discussions.

The second had to do with the question of the Sinai commitment for peacekeeping forces.

Mr. President, there was reprogramed by the House of Representatives a request of $10 million for up-front money for communications, structures, buildings, and all the other things that go with the auxiliary forces supporting the Sinai peacekeeping activity. That has been reprogramed to $10 million.

The administration in this week asked for an additional $125 million for that same purpose to keep this peacekeeping up-front money available for the infrastructure and for the bases for this whole program.

The Israeli Government has contributed $20 million. The Egyptian Government has contributed $20 million.

The problem we had was that there was no authorization for this and that question was raised in conference as well as in the House- of Representatives and it was considered that in order to meet the emergency that existed so that the whole Camp David peace accords upon which this whole activity was based would not fall apart and that we would keep pace with our own commitments that we would appropriate $50 million of the $125 million request with two provisos, one that no troops could be sent to the Sinai without specific congressional authorization, that this is only for materiel and for equipment and for infrastructure.

Second, that only $20 million of the $50 million could be expended immediately so that we put those two contingencies on the added moneys for the peacekeeping forces in the Sinai.

Mr. President, I invite the subcommittee chairman to comment on this because the last amendment was added by the House of Representatives I believe on the floor of the House of Representatives. I wish to have him correct m·y interpretation of that if it needs correcting.

Mr. KASTEN. I thank the chairman for yielding.

Mr. President. he is absolutely correct.

The question about $20 million being spent was discussed on the House of Representatives floor, but was rejected.

So we have ended up with a situation in which $125 million has been made available with the proviso that this in no way permits or requires or mandates the American involvement. That will be made by the appropriate committee, but there is no limitation on the funds. That eff'ort was debated briefly by the House of Representatives and rejected. So it remains as it did when we came out of conference.

Mr. HATFIELD. I thank the Senator for that correction.

The third and other amendment has to do with the Senate amendment on honoraria on which we removed the cap. The House modified that amendment in the committee by adding to that honoraria amendment the proposition that in the future, which begins fiscal year 1983, should the President, through his Pay Commission make a recommendation to the Congress for a pay increase for high Federal officials, and if it included the Members of Congress, the appropriated funds would be automatic, and that that would occur unless either House, one House or the other, specifically by resolution denied that pay increase.

I think you have on your desks a resume that indicates that language very clearly on the second page numbered 15.

Mr. President, we will be subject to further questioning. But at this time in order to get to the amendments, I move the adoption of the conference report.

The PRESIDING OFFICE'R <Mr. STEVENS). The question is on agreeing to the conference report.

Mr. PROXMIRE. Mr. President, will the distinguished Senator from Oregon, the manager of the bill, yield for a question before we act on the conference report?

Mr. HATFIELD. Yes, I would be happy to yield.

Mr. PROXMIRE. I want to be sure that when we act on the conference report there is no provision in the confere-nce report itself relating to honoraria or relating to a pay increase or relating to a tax deduction ceiling and that we will have an opportunity, if we wish to do so-there may not be a wish to do so, but if we wish to do so to have a vote, rollcall if we want it, on the automatic appropriation which the Senator from Oregon adverted to?

Mr. HATFIELD. That is correct. Mr. PROXMIRE. There will be an op

portunity to act separately on those amendments. So in acting on the conference report we do not prejudice our opportunity, if we wish to do that later, to vote.

Mr. HATFIELD. We maintain that upon adoption of the conference report we will handle those amendments in any manner the Senate wishes to do so.

VA HEALTH-CARE APPROPRIATIONS AND

PERSONNEL CEILINGS

Mr. CRANSTON. Mr. President, as ranking minority member of the Veterans' Aff'airs Committee, I would like to clarify one point with respect to the appropriations for Veterans' Administra-

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22577 tion health-care staffing. Section 5010 \a) (4) of title 38, United States Code, requires the Director of the Office of Management and Budget, after the enactment of each law making appropriations for the VA, to provide the VA with authority to employ under the three VA health-care accounts the numbers of employees for which funds have been appropriated.

The accounts are the medical care ac- . count, the medical and prosthetic research account, and the medical administration and miscellaneous operating expenses account. Since VA appropriations laws do not themselves specify employment levels for that agency, it is important that the legislative history of any law making appropriations for the VA be clear and specific as to the numbers of employees for which appropriations have been made in these accounts.

In this connection, I would note that section 101<e) of the continuing resolution specifies that VA appropriations are being made until November 20, 1981, in the amounts "necessary (for VA accounts) at a rate of operations and to the extent and in the manner provided for in the conference report and joint explanatory statement of the Committee of Conference <H. Rept. No. 97-222) [on the HUD-Independent Agencies Appropriations Act, 1982, H.R. 4034J filed in the House of Representatives on September 11, 1981, as if such act had been enacted into law." With respect to the VA's medical care account, the joint explanatory statement accompanying the conference report on H.R. 4034 states that $330,054,000 and 5,181 sta1f years were restored to the President's March budget request. With that restoration, it is clear that fiscal year 1982 appropriations are being proposed for 186,287 staff years in the medical care account-the same number originally proposed for fiscal year 1982 in the President's budget submitted on January 15 of this year.

It seems clear to me. in light of the language used in section 101<e) of the continuing resolution and the clear legislative history of the conference report on the HUn-Independent Agencies Appropriations Act, 1982, that it is intended in the continuing resolution to provide appropriations for a pro rata portion of 186,287 staff years; that is. 186.287 fulltime-equivalent employees for the 51-day period covered by the continuing resolution.

Thus, Mr. President, to make sure that there is a complete understanding on this, I ask the very able and distinguished chairman of the Appropriations Subcommittee on HUn-Independent Agencies <Mr. GARN) whether I have correctly stated the intent of the continuing resolution in this regard.

Mr. GARN. Mr. President, the Senator from Califomia <Mr. CRANSTON) is correct. During the period covered by the continuing resolution, appropriations are made for 186.287 full-time-equivalent employees under the VA's medical care account.

Mr. CRANSTON. I thank the Senator

from Utah <Mr. GARN) for that clarification and would note that, using the same reasoning for the medical and prosthetic research account, it seems clear that it is intended in the continuing resolution to provide appropriations for the employment of 4,487 full-timeequivalent employees for the period covered. Likewise, under the medical administration and miscellaneous operating expenses account, it seems clear that the continuing resolution is intended to provide appropriations for the employment of 866 full-time-equivalent employees for that period. Does the Senator agree with this analysis?

Mr. GARN. I do agree, Mr. President. That analysis is correct.

Mr. CRANSTON. Given the clear legislative history on these matters, it is the obligation of the Director of the Office of Management and Budget under section 5010(a) (4), following the President's approval of this resolution, immediately to provide the VA with these ceilings for the period ending November 20, 1981, together with the necessary funds, and promptly provide the Congress with his certification to that effect.

Mr. GARN. Mr. President, the Director's obligations to provide those ceilings and make that certification are clear, and I thank the Senator from California <Mr. CRANSTON) for his assistance in clarifying these very important matters.

Mr. CRANSTON. Mr. President, I thank the Senator from Utah once again for his cooperation and his great concern for the well-being of this Nation's veterans.

Mr. SIMPSON. I agree with the statements of the two Senators regarding this important matter and thank them for making these clarifications.

The PRESIDING OFFICER. The question is on agreeing to the conference report.

Mr. DECONCINI. Mr. President, I am going to ask for the yeas and nays.

The PRESIDING OFFICER. Is there a f'Ufficient second? There is a sufficient second.

The yeas and nays were ordered. Mr. EXON. Mr. President, I thank my

friend from Arizona for asking for the yeas and nays. I was about to do the same.

I would like to ask a further question just for clarification for myself and other Members of this body.

First, is it within the knowledge of either one of the managers of this bill as 1:Jo whether or not the conference report was subject to a rollcall vote in the House of Representatives?

Mr. HATFIELD. The conference report was adopted by a voice vote as I watched it on the closed circuit television.

Mr. EXON. It was adopted without a rollcall vot'e in the House of Representatives.

Next, if I understand it correctly, if the conference report is accepted by our body, No. 1. it would eliminate the cap on

Federal employee pay raises; is that correct?

Mr. HATFIELD. No, that would not because that was dropped in conference.

Mr. EXON. That was dropped in conference-passed here but dropped in conference?

Mr. HATFIELD. The Senate receded in conference.

Mr. EXON. So it would not include the elimination of the pay cap as the Senate voted it?

Mr. HATFIELD. That is correct. It does not include it.

Mr. EXON. No. 2, if the conference report is adopted as it is retumed to this body, would we eliminate the cap on honoraria?

Mr. PROXMIRE. First, Mr. President, will the Senator from Nebraska yield on that first question he asked?

Mr. EXON. I would be glad to yield to any of the managers on these questions because I want to get it straight.

Mr. HATFIELD. Can I answer that question?

Mr. EXON. Mr. President, may we have order? I am having very great difficulty in hearing.


Mr. HATFIELD. I say to the Senator that in adopting the conference report we did not make any commitment on the honoraria question because it stands separately as an amendment in disagreement. So in adopting the conference report, to answer the Senator's question, no, it does not make a decision on the honoraria question.

Mr. EXON. Let me phrase the question a little bit differently. Assume we adopt the conference report here tonight and it is signed by the President, hopefully, before midnight. Would there be any cap on honoraria?

Mr. HATFIELD. It depends on what the Senate decides to do when we take up, following the adoption or rejection of the conference report, that amendment. That amendment stands separate and apart from this motion to adopt the conference report.

If the Senate adopts the amendment as modified by the House then it becomes a part of the conference report. It will be sent to the President, and the cap will be removed. If the Senate rejects that amendment dealing with honoraria after we act on the conference report it does not go to the President and the cap remains.

Mr. EXON. If I understand the Senator from Oregon, then what he is saying is that the honoraria issue stands separately and we will have an opportunity for a rollcall vote up or down on that issue, in effect reconsidering our previous act?

Mr. HATFIELD. The Senator is correct.

Mr. EXON. Let me get to the third point: What about the elimination of the maximum $3,000 that can be claimed now by Congressmen on their income tax for away-from-home expenses? If we adopt that or is that included, and


if we adopt the conference report will that go forward as it was passed in the Senate?

Mr. HATFIELD. That stands on its own, as indicated by the Parliamentarian When he outlined the amendments that are in disagreement. It will have to be acted upon as in technical disagreement so that amendment would stand separately and be acted upon after we act on the conference report.

Mr. EXON. If I understand the chairman of the Appropriations Committee then the matter of the $3,000 claim we can make on our income tax returns stands similar to the explanation he just gave us on the honoraria; is that correct?

Mr. HATFIELD. Th~ Senator is correct.

Mr. EXON. Is the question now before the body that was agreed to just a few minutes ago with regard to the request for the yeas and nays by the Senator from Arizona on the conference report only and not on the other issues on which I have posed questions?

Mr. HATFIELD. The answer is, yes, but it is not exclusively restricted to those other issues. There are six amendments, and the Senator from Nebraska only asked me concerning, I believe, two. There are four other amendments that will stand in the same position independent of the conference report action that will have to be acted upon by the Senate by any means by which they desire to act on them.

Mr. EXON. If I understand then correctly, it seems to me that we could safely say that the conference report does not act on the issues I have just outlined, and if they are going to become part of our action they would have to be voted upon again in the Senate.

Mr. HATFIELD. They will have to be handled in whatever manner the Senate desires as a separate action to the motion to adopt conference report and, hopefully, we can do that before midnight.

Mr. EXON. Mr. President, would it be in order at this time for the Senator from Nebraska to ask for the yeas and nays on the matter of the $3,000 expense item that I referred to and on the matter of the pay raises as to the veto requirements of the Congress in the future as explained by the Senator from Oregon?

The PRESIDING OFFICER. The Chair would state it would take unanimous consent to have the yeas and nays ordered on any matter that is not pending before the Senate at this time. The yeas and nays are ordered on the conference report.

Mr. EXON. Mr. President, I ask for the yeas and nays on the two items that I have referred to; namely, the elimination of the $3,000 expense allowance for away-from-home expenses and the matter of the possible automatic raises for Members of Congress unless vetoed in the future by actions of either body.

Mr. BAKER. Mr. President, reserving the right to object, and I shall not object Mr. President, there is no reason not t~

do this. I can assure the Senator from Nebraska that nobody is going to deprive him of this right to ask for a rollcall vote on these two items. If it will shorten this in any manner, I am perfectly willing, for my part, to give unanimous consent that it be in order at this time to order the yeas and nays on these two items. I do not object.

Mr. HATFIELD. I do not object. The PRESIDING OFFICER. Does the

Senator make that request at this time? Mr. BAKER. Mr. President, I think

the Senator from Nebraska has made that request. If he has not, I ask unanimous consent that it now be in order, with one showing of hands, to order the yeas and nays on the two items in disagreement just identified by the Senator from Nebraska.

Mr. DECONCINI. Reserving the right to object, does that include the question of honoraria?

Mr. BAKER. Yes, it does. Mr. LEAHY. Mr. President, reserving

the right to object, and I will just make a parliamentary inquiry, am I correct in understanding that if this bill goes past midnight before we get a :final vote on it, the Federal judges get an automatic pay raise?

Mr. BAKER. Yes. Mr. HATFIELD. They do. The PRESIDING OFFICER. Is there

objection? Without objection, it is so ordered.

Mr. BAKER. Mr. President, I ask for the yeas and nays.


The yeas and nays are ordered on the two items in question.

Mr. HATFIELD addressed the Chair. The PRESIDING OFFICER. The Sen

ator from Oregon. Mr. HATFIELD. Mr. President, I won

der if the Senator from Arizona will withdraw his request for the yeas and nays on the conference report and save that much time for a rollcall.

Mr. DECONCINI. Mr. President, I would like to have the yeas and nays. I am more than happy to reduce it to a 5-minute vote.

Mr. BAKER. Mr. President, we cannot do a 5-minute vote. There is good attendance on the floor. I ask unanimous consent-and I need the attention of the distinguished minority leader or his representative. I am prepared to ask unanimous consent that the rollcall vote on the conference report be 10 minutes. If the Chair will bear with me for just a minute until I can get a signal from the minority, I will be prepared to make that request.

Mr. President, I ask unanimous consent that the rollcall vote on :final passage on the conference report be 10 minutes in length.


The question is on agreeing to the conference report. The yeas and nays have been ordered and the clerk will call the roll.

The assistant legislative clerk called the roll.

Mr. STEVENS. I announce that the Senator from North Carolina <Mr. EAsT), the Senator from New Hampshire <Mr. RuDMAN), and the Senator from Connecticut <Mr. WEICKER) are necessarily absent.

I further announce that, if present and voting, the Senator from North Carolina • <Mr. EAsT) would vote "yea."

Mr. CRANSTON. I announce that the Senator from Virginia <Mr. HARRY F. BYRD, Jr.), the Senator from Nevada <Mr. CANNON), the Senator from Louisiana <Mr. LoNG), the Senator from Hawaii <Mr. MATsUNAGA), and the Senator from New York <Mr. MOYNIHAN) are necessarily absent.

The PRESIDING OFFICER <Mr. WARNER). Axe there any other Senators in the Chamber desiring to vote?


fRoUcall Vote No. 302 Leg.l YEAB-64

Abdnor Glenn Andrews Gorton Ba~ Hart Boschwim Hatfield Bre.clley Hawkins Bumpers Haye.kawa Burdick Heinz Byrd, Robert c. Hollings Chafee Huddleston Cochran Humphrey Cohen Inouye Cmnston Jackson D'Amato Johnston Danforth Kassebaum De:nJton Ks-sten Dixon r.~axalt Dodd Leahy Dole Lugar Domenic! Mathias Durenberger Mattingly Ford McClure Garn Melcher

Armstrong Baucus Benrtsen Bid en Boren Chlles DeConclnl Eagleton Ex on Goldwater

NAYB-28 Grassley Hatch Hefiin HelmS Jepsen Kennedy Levin Metzenbaum Nunn Pressler

Mitchell Murkowsld. Nickles Packwood Pell Percy Pryor Quayle Rarulolph Schmitt Simpson Specter Stefford Stennis Stevens Thurmond Tower Wallop Warner Williams

Proxmire Riegle Roth Sarbfmu Sasser Symms TsonglSB Zor1n&ky

NOT VOTING-8 Byrd, East Moyntiha.n

HarcyF., Jr. Long Rudm&l oa.nmm Matsunaga Weicker

So the conference report <H.J. Res. 325) was agreed to.

Mr. HATFIELD. I move to reconsider the vote by which the conference report was agreed to.

Mr. PROXMIRE. I move to lay that motion on the table.


The PRESIDING OFFICER. The clerk will state the amendments in disagreement.

The legislative clerk read as follows: Resolved, That the House agree to the re

port of the committee of conference on the disagreeing vote of the two Houses on the amendments of the senate to the resolution (H.J. Res. 325) entitled "Joint resolution making continuing appropriations for the fiscal year 1982, and for other purposes."

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22579 Resolved, That the House recede from its

disagreement to the amendment of the Senate numbered 16 to the aforesaid resolution, and concur therein with an amendment as follows:

In lieu of the section number named in said amendment, insert: llOA

Resolved, That the House recede from its disagreement to the amendment of the Senate numbered 31 to the aforesaid resolution, and concur therein with an amendment as follows:

In lieu of the matter inserted by said amendment, insert:

SEc. 125. The first sentence of section 110 (a) of the Supplemental Appropriations and Rescission Act, 1981 (Public Law 97-12) is amended by inserting immediately before the period at the end thereof the following: "; except that the total amount so transferred from any such balance remaining as of the close of the fiscal year 1982 shall not exceed an amount equal to $15,000 or 25 per centum of the amount of such Senator's Oftlcial Office Expense Account, whichever is greater, as determined under section 506 (b) ( 1) of the Supplemental Appropriations Act, 1973 (2 U.S.C. 58(b) (1)), for the calendar year 1982."



SEc. 130. (a) In section 323(a) of the Federal Election Campaign Act of 1971 (2 u.s.c. 441(a) )-

( 1) strike out all after "shall accept" down to and including " ( 1) any" and insert "shall accept any"; and

(2) strike out all after the word "speech," down to and including "year." and insert "or article.".

(b) In section 102(a) (1) (A) of the Ethics in Government Act of 1978 (2 U.S.C. 702 (a.) (1) (A), after the word "source" where it appears the last time in the paragraph insert "including speeches, appearances, articles, or other publications".

(c) Effective beginning with fiscal year 1983, and continuing each year thereafter, such sums as hereafter may be necessary !or "Compensation of Members" (and administrative expenses related thereto), as authorized by law and at such level recommended by the President !or Federal employees for that fiscal year are hereby appropriated from money in the Treasury not otherWise appropriated. Such sums when paid shall be in lieu of any sums accrued in prior years but not paid. For purposes of this subsection, the term "Member" means each member of the Senate and the House of Representatives, the Resident Commissioner !rom Puerto Rico, the Delegates from the District of Columbia, Guam, Virgin Islands, and American Samoa, and the Vice President.


In lieu of the matter inserted by said amendment, insert.

SEc. 137. Notwithstanding any other provision of law or this joint resolution, '$250,-000,000 shall be available for loans to be guaranteed under the Rural Development Insurance Fund for alcohol production fac111ties to applicants that the Secretary of Agriculture determines are qualified to receive such guarantees, and $93,200,000 shall be available !or the Elderly Feedin~ Program authorized by section 311 of the Older Americans Act.

79-059 0-85-24 (Pt. 17)



SEc. 138. Notwithstanding any other provision of this joint resolution, $125,000,000 shall be available for expenses necessary for the participation of the United States in a Multinational Force and Observers to implement the Treaty of Peace between Egypt and Israel: Provided, That the fac111ties constructed by use of these funds shall not be available for participation of U.S. troops in the Multinational Force and Observers in the Sinai without prior authorization by Congress for the participation of U.S. troops.


In lieu of the section number named in said amendment, insert: 139

Mr. HATFIELD. Mr. President. The PRESIDING OFFICER. The Sen

ator from Oregon. Mr. HATFIELD. Mr. President, I want

to propound a unanimous-consent request relating to the remaining amendments, so may I have order?


Mr. HATFIELD. Mr. President, excepting the two amendments which already have the yeas and nays called for and ordered, I ask unanimous consent that the other four-Nos. 16, 31, 43, and 44 that have been explained-be considered en bloc and put to a voice vote.

The PRESIDING OFFICER. Is there objection?

Mr. EXON. Mr. President, what about the expense allowance matter? I do not want anything to move by here.

The amendments the Senator just referred to have reference to the expense account?

The PRESIDING OFFICER. The Senate will be in order. It will be helpful if the Senator from Nebraska would use the mike.

Mr. HATFIELD. We already have unanimous consent, I say to the Senator from Nebraska, to have the yeas and nays on that amendment, which is No. 46 and the honoraria, which is No. 36. Those two are excluded from this unanimous-consent agreement.

Mr. EXON. Would the Senator explain what it is so we understand? Under the unanimous-consent request, let us stack them up and I would like to ask my friend from Oregon to explain what they are and the order he is requesting that we have the rollcall votes.

Mr. HATFIELD. I have explained them previously, but I would be very happy to explain them again.

No. 16 is on page 16 of the bill. It is a Hollings amendment that was offered by the Senate and accepted by the House relating to the EDA.

What this does is prevent a RIF action being taken against these particular emolovees during this continuing resolution.

Mr. EXON. The Senator is requesting that be what order of voting?

Mr. HATFIELD. That is the No. 1 amendment in disagreement, but it is No. 16 in the report. What I am suggesting is, because there was no major controversy surrounding these, we voice vote these en bloc.

The second one is No. 31. That is on page 24. This is a Senate housekeeping amendment, which was acted upon by the Senate. As initially passed by the Senate, it provides for the transfer from our clerk hire any excess moneys that we might have to other funds, but not to exceed 25 percent of the total or $15,000, whichever is higher. That initially was to go into effect in 1981, but because there were some questions raised by Members of the Senate after the action was taken, I offered the amendment in the conference committee to delay the action of that until 1982 so that we could take a review of it during the year.

The third one is No. 43. Here is the language on that.

Notwithstanding any other provision of law or this joint resolution $250 mlllion shall be available--

Mr. EXON. Will the Senator from Oregon yield?

Mr. :A:ATFIELD. Yes. Mr. EXON. I assume that when the

conference report was just passed, we had disposed of the matter on the judges by midnight, am I correct? Or are we still running the risk of a raise to the judges because we are talking about this matter?

Mr. HATFIELD. My understanding is that until we dispose of each one of these amendments at midnight, if we have not ac~ed on these amendments, the judges will receive their raise.

Mr. EXON. Do I understand, including the rollcall votes?

Mr. PROXMIRE. If the Senator will yield, the fact is that until the President signs the bill, the bill is not effective, does not become law. The President will not sign the bill before midnight, that is clear. Therefore, the judges will not be in a position to get their increase. · Mr. EXON. So there is no need to rush

this. Mr. PROXMIRE. No, that is right, as

far as the judges are concerned. Mr. HATFIELD. This makes available

$93.000 for the elderly feeding program authorized under the Older Americans Act. This is a bridge for that program during the life of this resolution.

The last is No. 44. This has to do with the peacekeeping forces in the Sinai that I explained earlier.

Those are the four amendments that I have asked unanimous consent to have considered en bloc and voice voted.

Mr. EXON. I thank the Senator from Oregon.

The PRESIDING OFFICER. Is there an ob.1ection to the request of the Senator from Oregon? There being none, it is so ordered.

The clerk will state the next amendments.

Mr. HATFIELD. Mr. President. these amendments have been adopted, is that correct?

The PRESIDING OFFICER. The


question is on concurring en bloc to the four amendments.

Mr. HATFIELD. Mr. President, I move that the Senate concur in the amendments of the House to the amendments of the Senate, the amendments that have been explained, by voice vote.

The PRESIDING OFFICER. The question is on agreeing to the amendments en bloc.

The amendments in disagreement Nos. 16, 31, 43, and 44 were agreed to.

Mr. BAKER. Mr. President, I move to reconsider the vote.

Mr. HATFIELD. I move to lay that motion on the table.


SENATE AMENDMENT NO. 36

Mr. HATFIELD. Mr. President, we are ready to move to the next amendment, No. 36.

The PRESIDING OFFICER. The clerk will state t.he amendment.

The legislative clerk read as follows: SEc. 130. (a) In section 323(a) of the Fed

eral Election Campaign Act of 1971 (2 U.S.C. 441(a) )-

(1) strike out all after "shall accept" down to and including "(1) any" and insert "shall accept any"; and

(2) strike out all after the word "speech," down to and including "year." and insert "or article.".

(b) In section 102(a) (1) (A) of the Ethics in Government Act of 1978 (2 U.S.C. 702(a) (1) (!A)), after the word "source" where it appears the last time in the paragraph insert "including speeches, appearances, articles, or other publlcations".

(c) Effective beginning with fiscal year 1983, and continuing each year thereafter, such sums as hereafter may be necessary for "Compensation of Members" (and administrative expenses rela-ted thereto), as authorized by law and at such level recommended by the President for Federal employees for that fiscal year are hereby appropriated from money in the Treasury not otherwise appropriated. Such sums when paid shall be 1n lieu of any sums accrued in prior years, but not paid. For purposes of this subsection, the term "Member'~ means each member of the senate and the House of Representatives, the Resident Commissioner from Puerto Rico, the Delegates from the District of Columbia, Guam, Virgin Islands, and American Samoa, and the Vice President.

Mr. HATFIELD. Mr. President, this is the amendment we earlier described as the honorarium amendment which lifts the cap from the Senate honoraria, which we now have at $25,000. It adds a modification to the House as to future pay increase that ma.y be recommended by the Presidential Pay Commission and recommended by the President.

What I would like to do is yield to my colleague from Alaska, who is the author of the amendment. What it does by the House modification is set into place an automatic provision that funding would be automatic should the Commission in the future make a recommendation that may include Members of Congress in the pay raise recommendation unless the Members of Congress specifically deny themselves that amendment or that pay raise, as we have in the past.

That, I say to my collea.gues, is precise-

ly the situation at the moment, because Congress can block any pay raise now recommended if we merely continue that, but we attached that in the conference to the honorarium amendment.

I yield to my colleague from Alaska. Mr. STEVENS. Mr. President, I am

the author of the original amendment. The amendment reported in disagreement originated in the House. Its effect is this: The President, in every quadrennial year, has the obligation to have a Pay Commission report. We also have a yearly report on cost-of-living adjustments. Those come to us in March. They go into effect in October unless they are disapproved.

As the Senator from Oregon stated, in every year but one they have been disapproved for Members of Congress. What this says is if October 1 comes and the pay raise as recommended by the President is not disapproved, it is automatically funded. It does not bar pay caps that have been voted in the past. One is in place right now. As a matter of fact, there is still one in this bill that continues the pay cap until November 20.

So there are no hidden things in this at all. It is an attempt to take the matter out for the Members of Congress, out of the legislative appropriations bill. It could be raised in the Senate, as it has been in the past, as a rider on any appropriations bill between March and October.

If the Members of the Senate want to deny themselves a pay raise, a cost-ofliving allowance recommended by the President, or the quadrennial pay increase, we simply have to say it will not go into effect. So there is no hidden meaning here at all.

Mr. PROXMIRE. Will the Senator from Alaska yield?

Mr. STEVENS. Yes, I yield. Mr. PROXMIRE. The Senator said in

the past, these increases have been disapproved. Have they been disapproved orjustnotfunded?

Mr. STEVENS. They h81ve been disapproved because the specific language suspends the recommendation that they go into effect. They do not go into effect and therefore, they are not funded in the legislative bill.

Mr. PROXMIRE. The change here 1s what? How does this change the procedure from the past?

Mr. STEVENS. It does not change it as far as the ability to put a pay cap on in the future. This says if Congress does not block the President's recommendationit does not say it does not apply to Members of Congress-it will be effective October 1 without the legislative pay bill having been enacted.

It takes the matter out of the legislative pay bill and leaves it to any other vehicle you want to use. But so far as that is concerned, even in the legislative pay bill, you put legislation in an appropriations bill, and that is what the pay cap has been in the past. It is an attempt to make the pay act work, and we agree with the propOsal of the House that this would be added.

I call attention to the fact that it 1s very salutary. I believe that again we will

face the question of pay raises. The pay cap is then effective until November 20.

This resolution expires November 20, and we will have to face it in the next continuing resolution.

This amendment says that if these moneys are accepted under this automatic funding, then those swns are in lieu of any sums accrued in prior years but not paid. There is over 20 percent in cost-of-living adjustments due Members of Congress which have not come into effect. If this automatic language is the language that triggers any pay increase, all the ones in the past are wiped off the books. That was done at the suggestion of the distinguished chairman of the committ.ee, Representative WHITTEN. It is a good provision.

It means that if on November 20 we decide to take the 4.8-percent increase for Members of Congress and for the executive branch, at that time the accrued 21 percent would be wiped off the books.

SEVERAL SENATORS. Vote. Vote. The PRESIDING OFFICER. The ques

tion is on agreeing to the motion to concur in the House Amendment to the Senate amendment <No. 36). On this question the yeas and nays have been ordered, and the clerk will call the roll.


Senator from North Carolina <Mr. EAST), the Senator from New Hampshire <Mr. RUDMAN) , and the Senator from Connecticut <Mr. WEICKER) are necessarily absent.

Mr. CRANSTON. I announce that the Senator from Virginia <Mr. HARRY F. BYRD, Jr.), the Senator from Nevada (Mr. CANNON), the Senator from Louisiana <Mr. LoNG), the Senator from Hawaii (Mr. MATSUNAGA), and the Senator from New York <Mr. MoYNIHAN) are necessarily absent.

The PRESIDING OFFICER. Are there any other Senators who desire to vote?


[Rollcall Vote No. 903 Leg.) YEAS-48

Ba.lter Boschwltz Chafee Cochnl.n Crnllll!rto.n D'Ama.to Danforth Denton Dodd Dole Domenici DureDlberger Eagleton Gam Goldwater Gorton

Hatch Hatfield Hawkins Haya.kawa Hemz Bollinp Huddleston Inouye Jepsen Jolmston Kassebaum Kennedy Laxalt Lugar MathLas McClure

NAYs---44 Abdnor Exon Andrew• Ford Armstrong Glenn Baucus Gmssley BenJteeD H.8lrt Blden Heflin Boren Helms Bradley Humphrey Bumpers Jackson Burdick Kasten Byrd, Robert c. Leahly Chiles Levin Cohen Mattd·ngly De100ncln4 Melcher Dixon Metzenbaum

Murkowskl P*ekwood Percy Qua,.le Roth Simpson Specter Stennds BteVfliDS Symms Thurmond Tower Tsonga& Wallop Wamer WUUem•

Mitchell Nickles Nunn Pell Pressler Proxmire Pryor Randolph Rtegle Subanes Sasser Schmitt Stafford Zarinsky

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22581 NOT VOTING-8

Byrd, Eaat ~ .JI&t'ryF., Jr. Long Rudman

Ca.nncm Matsu.nap. Weicker

So the motion to concur with the House amendment to Senate amendment No. 36 was agreed to.

Mr. CRANSTON. Mr. President, I move to reconsider the vote by which the motion was agreed to.

Mr. BAKER. Mr. President, I move to lay that motion on the table.


Mr. HATFIELD. Mr. President, I move that the Senate concur in the amendment of the House to the amendment--

The PRESIDING OFFICER. The Senator will suspend until such time as there is order in the Chamber.

Senators are requested to take their seats. Guests in the Chamber are asked to respect the request of the Chair.

The Senator from Oregon is recognized.

Mr. HATFIELD. Mr. President, I move that the Senate concur in the amendment of the House to the amendment of the Senate No. 46.

Mr. FORD. Mr. President, I apologize, but I cannot hear the distinguished Senator from Oregon and I hope the Chair will get order.

The PRESIDING OFFICER. The Senator from Kentucky is recognized. Again the Chair requesU; that there be order in the Chamber.

The Senator from Oregon. SENATE AMENDMENT NO. 48

Mr. HATFIELD. Mr. President, ·my motion is that the Senate concur in the amendment of the House to the amendment of the Senate No. 46.

This is the amendment that relates to the removal of the $3,000 limit on the amounts that Members of Congress can deduct on their income tax return for living expenses while away from home.

In effect it repeals that $3,000 cap that is now-not a cap but that $3,000 provision-and it puts us on the same level as all of the other citizens and business people of this country.

I yield to the Senator from Alaska who is the author of the amendment.

Mr. STEVENS. Mr. President, this amendment was taken back in disagreement with the House. It has not been changed since the time it was voted on in the Senate, with one technical amendment by the House with reference to the numbering of a section it is the same. No change in the substance, and I think it should be voted on.

The PRESIDING OFFICER. The yeas and nays having been ordered, the question is on agreeing to the motion of the Senator from Oregon. The clerk will call the roll.

Mr. DECONCINI. Mr. President, before we have a vote on this, can we tum the clock back on? I think we look pretty darned foolish here to show that we have finished this before 12 o'clock.

Mr. BAKER. If the Senator will yield to me, we cannot. I do not know what the result will be. I simply do not know what the result will be--and we are trying to complete this business before midnight. But the whole Government of the

United States stops functioning it we do not pass this bill.

Mr. DECONCINI. Mr. Leader, will the Senator yield?

Mr. BAKER. I will yield. Mr. DECONCINI. It is past midnight

now. Let us not kid the American public or ourselves as grown-up people. We did not make it.

Mr. BAKER. It the Senator will yield to me, it is certainly not a new practice and it is not the last time it will happen.

Mr. DECONCINI. It the leader will yield--

SEVERAL SENATORS. Vote. Vote. The PRESIDING OFFICER. Let there

be order in the Chamber. Mr. DECONCINI. Mr. President, I

seek recognition. The PRESIDING OF'F'ICER. The sen

ator is recognized. Mr. DECONCINI. Mr. President, I have

great respect for our leader and I appreciate the fact that it has happened before and will happen again. But this is foolishn~ss and if we are conducting the business of this Nation with these kinds of foolish moves, we have got to change. Do you not agree, Mr. Leader?

Mr. BAKER. Mr. President, I am prepared to vote.

The PRESIDING OFFICER. The question is on agreeing to the motion to concur. The yeas and nays have been ordered, and the clerk will call the roll.

The assistant legislative clerk proceeded to ca.ll the roll.

Mr. RANDOLPH. Mr. President, the Senate is not in order.

The PRESIDING OFFICER. The clerk will suspend unttl such time as the senate is in order.

The clerk will resume. The assistant legislative clerk re

sumed the call of the roll. Mr. RANDOLPH. Mr. President, I

realize that I am not---The PRESIDING OFFICER. The sen

ator is not recognized for the purpioSe of debate. The Senate is not in order. The clerk will resume.

The assistant legislative clerk resumed the call of the roll.

The PRESIDING OFFICER. Order is requested in the senate. The clerk will suspend. The clerk will resume ca.lling the roll.

The assistant legislative clerk resumed and completed the ca.ll of the roll.

Mr. STEVENS. I announce that the Senator from North Carolina <Mr. EAST), the Senator from New Hampshire <Mr. RUDMAN), and the senator from Connecticut <Mr. WEICKER) are necessarily absent.

Mr. CRANSTON. I announce that the Senator from Virginia (Mr. HARRY F. BYRD, JR.) , the senator from Nevada <Mr. CANNON), the Senator from Louisiana <Mr. LoNG), the Senator from Hawaii (Mr. MATSUNAGA), and the senator from New York <Mr. MoYNIHAN) are necessarily absent.

The PRESIDING OFFICER. Are there any Senators in the Chamber desiring tb vote?


(Rollcall Vote No. 304 Leg.)

YEAS--48 A~ Andrews Arm8trong Ba.ker Baucua Cba!ee Oochnm Cra.nston D'Amato Denton Dixon Dodd Dale Domen1c1 Eagleton Gam

Goldwater Gormn Hatch Hatfield Hawklru; HaJ8,kawa Hollfnp Huddleston Humphrey Inouye Jepsen Johnstcm Laxalt Leahy Lugar MlatbiraB

NAYB-M Bentsen OleDIDI Biden OraaeleJ Boren Hart Boschwltz He1lln Bradley Heinz Bumper~~ Helms Burdd.ck JacDoD Byrd, Robert c. Kassebaum Chiles Kasten Cohen Kennedy IliBinforth Levin DeCondnl Melcher Durenberger Metzenbaum EXOD Mitchell Ford Nunn

Ma.ttdngly McClure Murkowski Nickles Packwood Percy Quayle Specter Sta1ford Stevena Bymms Tower Tso.ngu Wallop Warn• Williams

Pen Preesiler Proxmb'e Pryor Raru:lolph Riegle Roth S84''bemes S8aser Schmitt Blml*)n Stennls Thurmond ZOrl.mrJE;r

NOT VOTING-8

Byrd, East MoyD1han HatTy F., Jr. Lang Rudman

oa.nnon Matsunaga Welckler

So the motion to concur in the amendment ot. the House to the amendment of the Senate numbered 46 was agreed to.

Mr. BAKER. Mr. President, I move to reconsider the vote by which the motion was agreed to.

Mr. STEVENS. I move to lay that mo-tion on the table. .


THE DEDUCTION FOR AWAY-FROM-HOME EXPENSES AND HONORAJUA INCOME

Mr. DECONCINI. Mr. President, last Thursday evening, President Reagan gave another of his graceful, warm, and persuasive performances on the national television and radio networks, presenting yet another revised standard version of his economic plan. The combination of additional expenditure reductions and minor revenue measures outlined at that time is apparently intended to offset-at least in part-the fiscal effects of the enactment earlier this summer of the President's tax and spending proposals. The expectational theory on which the administration predicated its economic scheme has not panned out. Further sacrifices, the Nation was told, will be necessary. Even deeper and more damaging cuts in the Federal domestic budget will have to be made.

The major portion of these additional savings, moreover, is to come through a 12.5-percent cut below the President's March 10 budget requests-a fair measure both of the excessive optimism, self -serving dissimultation, and questionable technical competence which combined to produce the original budgetary projections and of the administration's near desperation in the face of current economic realities highlighted by a deficit in the range of $60-$90 billion for the coming fiscal year.

It is thus more than ironie-indeed it is, in my view, nothing short of outrageous that on the very same day, Thurs-


day, September 24, this body adopted two changes in current law which are to the direct material benefit of Members of the Congress. The first would remove the existing $3,000 cap on the deduction for away-from-home expenses now allowable to Representatives and senators. This translates into tax savings-or seen from another perspective, increases in aftertax earnings-of several thousand dollars for every Member of the House and Senate.

The second, which was adopted in committee and amrmed on the floor when SP.nator PaoxMIRE's motion to delete it was rejected, strikes the $25,000 limit on outside earnings from honoraria for speeches, articles, and other contributions to the national literary life.

Aside from the obvious tension between the time requirements of official duties and these quasi-private activities, there is the further danger tha.t interested groups and organizations can use lucrative speaking engagements and fat fees for ghost-written articles in trade journals to acquire privileged access to congressional decisions. It is also pertinent to note that the current limit on outside honoraria, $25,000, exceeds the median income for a family of four in this country. Surely we can live on our salaries plus an amount that is more than the total income of the average American family.

Whatever judgment one reaches on these issues, Mr. President, the spectacle of the Senate of the United States voting itself increases in effective compensation on the same day the President is making an all-out public relations blitz on behalf of further sacrifices by ordinary Americans is too much to stomach. No wonder the public holds the Congress in low regard.

In any event, Mr. President, I am taking this occasion to make it clear that I intend to pursue the deletion of these provisions in the conference on House Joint Resolution 325. Should that effort prove unsuccessful, I will refuse to sign the conference report and oppose its adoption. I hope that I can count on the support of a majority of my colleagues on both sides of the aisle. I am confident that many of those who supported these provisions will, upon reflection, realize that whatever substantive merit these provisions may have is more than outweighed by the fact that this is the wrong time and the wrong place to be taking care of our own financial needs, real or imagined.

Mr. GORTON. What is the intent of the conference committee in connection with the future of the Public Health Service hospitals?

Mr. SARBANES. I join the distinguished senator from Washington in propounding this important question.

Mr. SCHMI'IT. We believe that the Secretary of Health and Human Services has authority to operate those hospitals which have submitted operationally feasible plans for conversion to community operation while the Congress considers the appropriate level of funding for such conversions. It is further the intent of the chairman of the Senate Labor-HHS Appropriations Subcommittee to try to persuade his colleagues to provide sumcient funds, possibly up to

$133 million, both for the closure of those hospitals in those communities which do not submit approvable conversion plans and for conversions of those hospitals in communities which do submit approvable plans.

Mr. BAKER. Mr. President, there will be no more rollcall votes tonight.

Mr. DECONCINI addressed the Chair. The PRESIDING OFFICER. The Sen

ator from Arizona is recognized. Mr. DECONCINI. Mr. President, I

would like to call to the attention of the Senate that the eastern daylight time right now is 12:27 a.m.

Mr. LEAHY. May we have order? The PRESIDING OFFICER. The Sen

ate will be in order. Mr. MATHIAS addressed the Chair. The PRESIDING OFFICER. The

Chair recognizes the senator from Maryland.

Mr. BAKER. Mr. President, will the Senator yield to me for a. brief moment?

Mr. MATHIAS. Yes.

ROUTINE MORNING BUSINESS Mr. BAKER. Mr. President, I ask

unanimous consent that there now be a brief period for the transaction of routine morning business to extend no longer than 15 minutes in which senators may speak.


WINE: IN QUALITY AND QUANTITY CALIFORNIA LEADS THE WAY F'OR THE U.S.A. Mr. HAYAKAWA. Mr. President, I

bring to the attention of the Senate a wonderful story of growth and success on the American agriculture scene. Specifically I refer to the tremendous growth of wine production in our Nation and the fact that American connoisseurs of fine wines no longer need look to France and Italy for the satisfaction of their palate. American wines, over half of which are produced in California, have not only claimed four-fifths of the domestic market but our quality is truly outstanding-world -class wines which Europe is finding increasingly difficult to compete with.

Also of great interest to those of us concerned with our balance of trade is that wine exports have grown dramatically-from 15 million liters in 1978 to some 40 million liters last year. At the end of 1979, we had 724 wineries in the United States, 450 of which were in California. As a recent article in the periodical The Economist of London, pointed out, "California's mild winters and long, warm summers are near perfect for cultivating grapes. The weather is also remarkably consistent; the amount of sunshine, rainfall, humidity, even frost can be predicted accurately and reliably."

Mr. President, I ask unanimous consent that this article: "The Maturing of American Wine," from The Economist magazine, be printed in the RECORD so that there might be a greater awareness within the Senate about the great and growing wine industry of our Nation.


[From the Economist, Sept. 5, 1981) THE MATURING OF AMERICAN WINE

The wine-drinking world is waking up to the pleasant surprise of cheap, cheerful and sometimes remarkably mature products from California's vineyards. Winemakers elsewhere (especially in southern Europe) are becoming edgy as they see one of their biggest export markets taken by storm from within, while at the same time a brash new competitor enters their crusty old wine trade.

For centuries, Europe has shipped its bottles to the new world. In the last decade, however, a trickle of wine has begun to fiow the other way. Canada was the first--and still the biggest-importer of American wines. Over the past couple of years, the dribble that fiowed to wine-bibbing Britain (a. country with little wine-growing of Its own) has become a steadier gush. For two good reasons:

Whether a Chateau St Jean (pronounced "St Gene") for £17.50 a bottle at the Tate Gallery restaurant (one of the earliest stockists in Britain) or a. £2.50 zinfa.ndel in a. Covent Garden wine bar, American wine is exceptional value by any standards.

Until recently, the hard pound and soggy dollar has made It especially easy for British Importers of American wines to get their wares established. Lip-smacking Britons, brought up on cheap and sometimes nasty Spanish and Italian plonk, have been easy converts.

Result: American wine exports are going up by leaps and bounds. The Bureau of Alcohol, Tobacco and Firearms in Washington puts wine exports at 25.7m litres in 1979-up !rom 15.5m litres In 19·78. Last year's exports are thought to have been over 40m litres.

EARLY SETTLER

Wlnemaking in America. is practically as old as the country. Natural grapes were fermented by settlers in the sixteenth century. Cuttings from European vine species (especially Vitls vlnifera) did not thrive in the harsh winters and humid summers of the American east coast. The soil was crawling with European vines' arch-enemy, phylloxera. Domesticated wild grapes (Vitia labrusca), producing spicy wines with distinct aromas, became the main source of American wine.

Commercial production began in the early 1800s, when tlle first domesticated native grapes were planted In Indiana, Ohio and Pennsylvania. By 1840, the wine Industry had spread through most of the American east and midwest. Meanwhile, Franciscan monks at a. mission in San 'Diego, California, had been experimenting with vinlfera. cuttings. The wines were acceptable for sacramental. purposes, but had little commercial value. However, they showed that European varieties could be grown in Californian soil.

Modern winemaking in California owes a massive debt to Hungarian-born Agoston Haraszthy, who was commissioned in 1861 to seek cuttings from Europe. He brought back 100,000 samples, many of which were planted in his Sonoma vineyards, north of San Francisco.

California's wlnemakers have also a lot to thank the University of Callfomia for. The university has a pioneering department for wine research (dating back to 1887) at its Davis campus. Success for the wine researchers came after the second world W!tr bv crossing native grapes with vintfera. These hardy hybrids ha.ve boOsted wine-growing in many places. Between 1955 and 1970, New York state growers used Californian knowhow to treble their wine production; sparking wine output increased fivefold. New York's production is now 135m lltres a year.

American wine-growers can also thank the importers for making wine a fashionable drink. Even today, a fifth of all wine (table.


dessert, sparkling and vermouth) is imported; one out of four bottles of table wine comes from abroad. Last year, America's wine imports totalled 380m litres. Italy supplied 200m 11tres, West Germany 49m litres and France 43m litres.

Americans have taken to white wine especially. It accounts for 49 percent of all wine drunk in America.; red wine accounts for 30 percent and rose and vermouth the rest. One out of four American households is now reckoned to be a wine buyer. But half the table wine sold in the country is drunk by only 10 percent of wine customers. Most are from the "brie and white wine set"-generally young,• inner-city, bourgeois with incomes well in excess of $20,000 a year.

Thanks to them, wine sales in America outpaced spirit sales for the first time ever last year. Americans bought lOOm litres more wine than spirits. Adults consu·med over 12 litres of wine per head in 1980. By 1985, says Bank of America, wine consumption is likely to have risen to 15.5 litres per adult.

Wine consumption in Europe is still much higher: in France and Italy, 90-100 litres per adult annually; in Spain, around 70 litres. But sales are now declining.

America's wine-growing has taken off so rapidly it has outstripped Washington's ability to keep tabs on it. The latest figures from the bureau of census indicate that wine produced was worth $2 billion at the vineyard gate in 1979. That translated into almost $5 billion worth of bottles in liquor stores. Production has grown from 1.3 billion litres in 1978 to 1.4 billion litres in 1979 and 1.8 billion litres in 1980. Last year, California produced 970m litres of wine (54 percent of total production).

By world standards, American wine production is still piddling. Last year, the world's vineyards pressed 36 billion litres of wine. France still led with 8.3 billion litres, followed by Italy with 8 billion litres, Spain 4.5 blllion litres, Russia 3.1 billion litres and Argentina 2.4 billion utres.

VINLAND REVIVED

Though hardly the "vast vineyard" that it appeared to Leif Ericsson, the Norse explorer who landed in Newfoundland 1,000 years ago, America nevertheless cultivates vines in 44 states. New York state is the second largest wine-producing area in America after California. The upstate region around Finger Lakes produces lots of sparkling, dessert and table wines. So do the Chautauqua, Niagara and Hudson valley regions. All told, New York produces 10 percent of America's wine.

Another significant wine-growing area is the Sandusky-Lake Erie Island region of Ohio (once the country's biggest wine-growing state) . Wine is also produced around Cincinnati, in the foothllls of the Ozark mountains in Arkansas, 1n the eastern part of North Carolina, at Council Bluffs in Iowa, in south-western Michigan, near the Egg Harbour district and northern New Jersey and along the Willamette valley in Oregon.

America had 676 bonded wineries at the end of 1978. A year later there were 724. New York, Oregon and Pennsylvania have had their share. But, despite skyrocketing costs of real estate, California is where most would-be winegrowers are heading. The state now has 450 wineries, about 100 of which account for 80 percent of shipments. Future winegrowers look like heading farther north-in Oregon's flinty soils that produce spectacular chablis.

EVERY KIND OF CLIMATE

California's mild winters and long, warm summers are near perfect for cultivating grapes. The weather is also remarkably consistent; the amount of sunshine, rainfall, humidity, even frost, can usually be predicted accurately and reliably. But contrary

to popular belief, growing seasons do varycreating (as in Europe) vintages of various quality.

The state has a wide range of microclimates. It offers conditions comparable to those from the Rhinegau to North Africa. That, plus the different soils and altitudes, means practically every type of grape (and hence wine) can flourish there.

The microclimates, categorised by researchers at Davis, are classified on a scale of "degree-days". This measures the time the temperature remains above 50°F during the growing season (April 1st to October 31st). The degree-day for any one day is simply its average temperature above 50°F; the total for an area. is the average daily figure multiplied by the number of days that temperature has been recorded.

Five growing areas in California have been !den tified:

Region I where the climate offers 2,500 degree-days a year or less.

Region II with 2,501 to 3,000 degree-days. Region III with 3,001 to 3,500 degree-days. Region IV with 3,501 to 4,000 degree-days. Region V with more than 4,000 degree-

days. The best growing areas are regions I and II

(shown on the map, for convenience, a.s a single area.) . They are the smallest wine growing areas and located near the coast where winds blowing off the Pacific have a moderating effect.

Because local conditions vary so much, prime land (eg, Napa Valley) can cost up to $20,000 an acre. Land prices in Sonoma, Monterey and other low degree-day areas are getting almost as steep. Still, they .are not deterring investors. Many of the new "boutique" wineries have been established there by private individuals. The St Jean Winery, set up seven years ago near Kenwood in Sonoma. Valley, has gained a reputation for its chardonnays and Johannisberg rieslings. The founders have sunk $10m into the winery so far, using cash from their family firm.

California's wineries have benefited particularly from the influx of cash and management from outside. National Distillers, for instance, has owned Almaden Vineyards in San Jose since 1967. Today, it is a leading producer of high quality "jug" (ie, table) wines. Heublein has owned the United Vintners group since 1969. It also owns the toprated Beaulieu Vineyard in the Napa Valley, founded by Georges Latour in 1900. Nestle bought Beringer Brothers of St Helena, one of Napa Valley's showpieces, in 1970.

Outside investment has helped pay for sorely-needed modernisation. Refrigeration equipment, mechanical harvesters and scientific techniques brought in by young oenologists and viticulturists from Davis had their impact, first, on table wines. Then the dessert wines were improved, followed by brandy. By 1970, America's brandy consumption had quadrupled over the amount drunk a decade before-with California. accounting for 75% of the production.

The French are investing heavily in California now. Recent developments include a 50-50 venture between Baron Phlllppe de Rothschild, owner of Chateau Mouton Rothschild in Bordeaux, and Mr. Robert Mondavi of the Robert Mondavi Winery in Napa Valley. Their aim: to produce "world class" wines in Ce.lifornia. Three months ago, a bottle of their Napamedoc changed hands for $2,000.

Last year, Piper Heidsieck of France and Renfield Importers Ltd (a major wine and spirit importer in the United States) announced a joint venture to produce sparkling wines using the proper champenoise method. They intend building a $6m complex at Renfield's Sonoma Vineyards to produce a wine called Piper Sonoma. Winemaking equip-

ment will be brought from France to produce 100,000 cases of sparkling wine a year.

Moet Hennessey has sunk $12m over the past four years into its 1,500 acre Californian vineyard, Domain Chandon. Under the supervision of Moet & Cha.ndon, the vineyard's production is already running at a rate of 100,000 cases a year. Production will rise by 30 per cent annually until output hits 250,-000 cases a year. In deference to French sensitivities, the name "champagne" is not used.

As more Europeans cross the Atlantic, the reputation of American (and especially Californian) wines Will spread. Many a visitor has already discovered that the best the new world can produce can now challenge (and often beat) anything the old world has to offer. Though American wines are often drunk young, reserve cabinet sauvignons, zinfandels (California's own "beaujolais") and some others are beginning to show how well such wines improve with age. In 15 years' time, the great French vineyards will have a real fight on their hands.

SOUTHEAST ASIAN INTERESTS

Mr. HAYAKAWA. Mr. President, I have just read a most thoughtful article tracing the evolution of U.S. thinking about Southeast Asia since the Vietnam war. It appeared in the July 1981 issue of the Asia Bulletin, and was written by the noted Asia scholar, Dr. Russell H. Fifield, professor of political science at the University of Michigan.

Professor Fifield argues that the United States becomes involved in Southeast Asia when it perceives a major power hostile to its interests is threatening the region, and cites the war with Japan and the Vietnam war as examples in recent history. Today, he asserts, our concern is with the growing influence of the Soviet Union, as seen in its naval e~pansion in South China Sea, its backing of Vietnamese occupation of Kampuchea, and its overall military buildup in nuclear and conventional weapons with which it can intimidate Third World countries. While acknowledging that this concern will cause security interests to have priority in the 1980's, Professor Fifield calls attention to the increasing strategic importance and vast economic potential importance of the region. Citing Southeast Asia's resources of oil, tin, rubber, and various agricultural projects, Fifield believes that U.S. trade with the area will continue to expand in the 1980's. Coupled with our current humanitarian concern for Southeast Asian refugees and our economic assistance programs, Fifield concludes that the convergence of our security and trade interests will make the area of increasing significance in American foreign relations.

On my recent trip to Southeast Asia, I came to many of the same conclusions stated by Professor Fifield. I particularly share his view on the economic potential of the region, the importance of Asian in our diplomacy, and the necessity to provide security and economic assistance to our friends and allies in the region. I ask unanimous consent that Professor Fificld's article be printed in the RECORD.

There being no objection, the article ordered to be printed in the RECORD, as follows:


AMERICA LOOKS TO AsiA WITH MODERATE INTEREST

(By Russell H. Fifield) The pendulum of American interests in

Southeast Asia is swinging away from the marked disengagement of 1975 when Indochina fell to the Communists, but still not toward any major involvement similar to that of a decade before which committed the U.S. to war in Vietnam. Now, tl;le pendulum has reached the point of moderate American engagement 1n the defense, diplomacy and development of Southeast Asia. How far and how fast the swing will be in the 1980s is not yet clear but the direction is certainly established.

The greatest restraint is American public opinion as reflected in the u.s. Congress. The Vietnam war syndrome may well be over. but the uproar about American involvement in El Salvador clearly provides a brake on Washington's policy. Moreover, Southeast Asia is a region of particular sensitivity in the U.S., given the country's debacle in Indochina and the high cost Americans still remember in unity, blood, and treasure.

In broader perspective, the u.s. becomes deeply involved in the future of Southeast Asia only when Washington perceives that a major power hostile to American interests is threatening to become dominant in the region. Such circumstances have already occurred twice in Southeast Asia in the last four decades and have helped to produce bloody wars fought by Americans.

SOVIET UNION INFLUENCE ON UPSWING

Today concerns exist about the possib111-ties of a third time. Japan's naked expa.ns.ion in Southeast Asia was a major step on the road to Pearl Harbor and the Pacifiic war. Later, China's threat to the region, as perceived by several American Presidents, was an important consideration in America's military involvement in V,ietnam. Now the growing influence of the Soviet Unionthrough its autance with Hanoi and influential role in Kampuchea, its naval expansion in the South China Sea and related · interests in the Strait of Malacca, and its increasing mUitary power in nuclear and conventional weapons with greater capabilities in the Third World-is a source of worry to the U.S., Japan, China, and members of the Association of Southeast Asdan Nations.

The •importance of Southeast Asia to the U.S. extends beyond just a possible Soviet threat. The region is of more strategic importance today than ever before, being between the Indian Ocean with its very critical Middle East littoral and the Pacific Ocean with its vast economic potential. The place of petroleum in world energy supplies enhances the importance of the present and potential oil reserves in Southeast Asia whether on land or offshore. America's access to the material resources of the regionsuch as rubber, tin, and oil-should not be minimized. Trade in both exports and imports is growing while investments are expanding. Nor can Washington be indifferent to the future of over 350 million people in a geopolitically sensitive region.

Finally, Southeast Asia today has indirect value to the U.S. through the area's strategic relationship W'ith Australia and economic importance to Japan, both key allies of America in the Western Pacific. Thus Washington's interests in Southeast Asia represent a combination of security, political, diplomatic, economic, and humanitarian concerns.

AMERICAN INTERESTS IN SE ASIA

But what about the degree of intensity an~ the mix and priority of these interests in the 1980s? Although precise definitions are elusive, the intensity of interests may be classified as vital, important, and marginal.

I'D the latter part of the 1960s W'ashington believed it had vit& interests in Southeast Asia, interests worth shedding blood for in the second Indochinese war. Within 10 years eS!Sellltially ma.rgina.l illlterests had repLaced the vital ones as the U..S. licked its wounds and tried to adjust to the consequences &t home and abroad of the coll&pse of Saigon and the victory of Hanoi.

By 1980, American interests in Southeast Asia had become impol'!tant, comparable in many respects to those of the 19,505. The evidence indi-cates thalt the decade af the 1980s will find these interests increasingly important . .A.t the same time l:t is doulbtful if they wiU become as vi tal as they were thought to be when America plunged into wa.r in Vietnam.

The dimensions of the mix and priority of the U.S. interests in Southeast Asia in the 1980s are already emerging from the matrix of American politics and .ill!terna.tiona.l developments. Under the Reagan adminis·tsration, American military capacity, both nuclear and convenrtion&l, vis-a-vis that of the Soviet Union will be strengthened, deterute will be muoh more reciprocal, if at all retained, and the willingness to use American power in various \V'&.YB in selected n.reas of the world more evident. The momentum c4 these developments is likely to continue through the decade, influencing the 81ttitudes and polici·es of allles and adversaries as well as the nonaligned states of the Third World.

USA SUPPORT FOR THAILAND SEEN

In Southeast Asia, American security interests will ba.ve priority. Alliance commitments, namely the ties between the U.S. a.nd Thailand under the Manila Treaty of 1954, and between Amerioa. and the Philippines under the Mutual Defense Treaty of 1951, will remain firm. Indeed, the Reagan administration can be expooted to give notBible support to Thailand in its difficulties with Kampuohea. occupied by Vietnamese forces &t least for the early years c4 the 1980s.

The ties with the Philippines will reflect the great importance placed on the American naval facilities at Subic naval be.se and air facilities at Clark air base. The military presence of units of the seventh Fleet in the South China Sea, as well as the headquarters of the 13th Air Force in the Philippines will be a reminder of America's security interests in Southeast Asia.

The weakening of the seventh Fleet by withdrawal of significant units to the Indian Ocean to cope with the Gulf and Afghanistan crises will be remedied if planned naval expansion occurs. MUI.tary aid in different forms to various ASEAN countries will hopefully contribute to stronger ties among them and with the U.S.

In the political and diplomatic field., Washington can be expected in the 1980s to be a bulwark of support to ASEAN. The degree of backing and the pace of cooperation, however, will rightfully depend to a large extent on ASEAN's initiative and cooperation.

HANOI MUST PROVE ITSELF

President Reagan will be in ~o hurry to normalize relations with Vietnam. Hanoi will have to prove itself by deeds of a good neighbor in Southeast Asia. Vietnam's occupation of Kampuchea, as long as it lasts, and granting of naval and air facilities to the Soviet Union will continue to be criticized in Washington.

American economic interests in Southeast Asia will be supported by the U.S. but they will not have the priority of the security ones. Trades and investments will be encouraged as a vehicle of policy more than govern-

ment aid. And bilateral assistance will be favored more than multilateral.

Humanitarian interests in Southeast A&ia are likely in the 1980s to occupy a low priority in Washington. Human rights will not be allowed to weaken the security interests of the U.S. This attitude will strengthen relations at the official level in some cases but may raise problems in long-range relationships. Yet the silver thread of idealism in American policy, possibly in the treatment of boat refugees from Vietnam, will not vanish.

In the 1980s the interests of the U.S. in Southeast Asia will be tested in Thai-Vietnamese controversies over Kampuchea and Laos, but even more in the rivalries of the regional and extraregional powers of the South China Sea. These interests will be best served if Amerioa. adopts the posture of neither the revolutionary nor the colonia.Ust. Moderation in defense, diplomacy, and development will probably be the policy.

AFFIRMATIVE ACTION Mr. HAYAKAWA. Mr. President, last

week a senior official of the Justice Department testified before a House committee hearing on affirmative action that the Reagan administration no longer will insist upon or support the use of quotas or any other numerical or statistical formulae designed to provide preferential treatment to nonvictims of discrimination.

Predictably, the announcement set off a furor among affirmative action lobbyists present who predicted that such a policy of opposition could lead to "despair and gloom" or an "explosion" among minority people, according to one spokesman.

The other side of the coin of official affirmative action programs is very graphically described in the Washington Monthly of January 1981. Entitled, "What's Wrong With Affirmative Action," the article provides one horror story after another of how the concept of required quotas and hiring certain people just because of their race or sex demoralizes personnel, costs the Gov.,. ernment thousands of dollars in legal fees and lost hours of employees' work while pursuing grievances, and often results in less efficient performance in carrying out the Government's business.

One case described a grievance brought by a marginal professional performer hired because of his race who was refused a grade raise and reimbursement of night school costs for courses not related to his Government job. The employee did virtually nothing for 3 years except work on his case-3 years of Government time-and finally won. No one will ever know the effect of this kind of happening on the morale of the other professionals or the hostilities it creates. Or how it cheapens the success of those minorities who make it because they really have the ability to do the job.

Mr. President, I recommend the article to all who are genuinely concerned about fairness and equal opportunity based on merit. I ask unanimous consent that it be printed in full in the RECORD.

Ther-e bein~ no objection, the article was ordered to be printed in the REcoRD, as follows:


WHAT'S WRONG WITH AFFIRMATIVE ACTION

(by Leonard Reed) The scene was a seminar room at the Fed

eral Executive Institute in Charlottesvllle, Virginia, the think tank for the U.S. government's career executives, and the discussion was animated among the half dozen or so federal managers who had been brought from various parts of the country to-wen, to think. Under discussion were the impediments that an overgrown government places in the way of inte111gent and efficient management, and all of the participants were leveling some blunt indictments against the powers that be (who always dwell in the next echelon up). Perhaps carried away by the heat and frankness of the bull session, one of them cited, as among the most severe problems, the government's "affirmative action" program. The animation froze as abruptly as if E. F. Hutton were about to be quoted. The executives looked around uneasily, suddenly aware that they hardly knew each other. A taboo subject had been raised, one that a person discussed frankly only with intimates. The embarrassed speaker was left to extricate his foot from his mouth as best he could.

But if few executives wlll discuss it in public, doubts about the government's affirmative action programs are epidemic in the federal service. They · are epidemic, most dramatically, among federal managers who have long considered themselves conscientious liberals. I know these people. They supported the civil rights movement, and they ported the affirmative action concept when it was first introduced. Today, when they glance around them to make sure they are alone before unburdening themselves of their doubts, one gets the feeling they are speaking with a frustration that comes from experience. There is something else too-an aura of resentment, born of the fear that prevents them from speaking more freely.

How did affirmative action, an idea spawned in an era of generosity of spirit, get from there to here?

NETWORK-BUSTING

The great civil rights movement of the sixties culminated in the Civil Rights Act of 1964. Title VII of the Act, which became effective in the summer of the following year, prohibits discrimination based on race, color, religion, sex or national origin in hiring, firing and all other terms and conditions of employment. The concept of "affirmative action" as an adjunct to Title VII developed later, as a number of amendments a.nd executive orders ensued throughout the seventies.

The concept has since taken on a life of its· own, but the original impetus for it had a powerful rationale. Prejudice and discrimination, both conscious and unconscious, are facts of life. In government, as elsewhere, managers looking to fill vacancies lean heavily on what have recently become popularized as "networks": applicants come to their attention after being passed along by a chain of people, the first of whom is a friend of the applicant and the last of whom knows the hiring otncial. Because white males have dominated the positions of power in the past, most nepw,orks have been white and male as have, inevitably, the successful candidates. (True, some women and some blacks have always managed to make it big on their own, but their success only served to emphasize their exceptionality.) Adding to the unconscious screening out of all but white' males was the stubborn resistance of a great many employers and managers who thought that woman's place WaS' at home or at best at the typewriter, and t!:lat blacks, ~I though 'not terribly reliable, could be useful at menial .1o"c; 'Vhere they were not likely to meet the public.

Habits and attitudes like those, ingrained in the social and economic fabric, are not easily changed. Prohibitions against discrimination are fine, but charges of discrimination are hard to prove. If competent women and blacks were ever to get a fair crack at the job market something had to be done to break the logjam that blocked them out. Hence, "affirmative action," a concerted effort to increase the numerical representation of women and minorities in non-dead-end jobs. It is a fair assumption that a substantial majority of the American people see that goal as one with which they associate themselves.

That substantial majority, however, melts away when the "affirmative action" moveS' beyond active efforts to discover, recruit, train, and hire qualified women and minorities. Increasingly, the term "reverse discrimination" ruffies the surface of American life, and the word "quota" is pronounced in terms of bewilderment or disagreement. The federal government is no exception. What is exceptional about the government is the extent to which the bounds of the discussion are set by affirmative action leaders who seem to see the program as an ideology from which no heresy is permitted. "Let the issue of quotas and 'reverse discrimination' be put to rest," decreed Eleanor Holmes Norton, head of the Equal Employment Opportunity CommisS'ion, in a 1979 address. "Let 'reverse discrimination' be banished from the language." Patricia Harris, the Carter Administration's Secretary of Health and Human Services, talking of the need to increase the number of women in management, recently said, "I hear about S'o-called 'reverse discrimination' but I have never seen it."

Well, to a white male denied a job or promotion simply because he is a white male, "reverse discrimination" remains a valid part of the language (as for Harris' observation, one can only suspect that she was playing in the sandbox with Ronald Reagan in that never never land where he grew up unaware that there was a racial problem in America.) And when percentile figures are set on the number of women and minorities that a supervisor must hire, iiTespective of relative qualification or performance, we can call it what it is, which is a quota, or we can follow the example of Alfred Kahn and call it a banana. •

The federal government 1s also different in that, because Caesar's wife must be above suspicion, affirmative action takes a more hard-nosed form there than in the private sector. The government's program is enforced by full-time Equal Employment Opportunity divisions within each agency. An agency's EEO not only investigates discrimination complaints, but it wields a var1ety of carrots, sticks, and clubs over the heads of the other agency managers whom it suspects of foot-dragging on the affirmative action front.

•The most recent banana was packed in a proposal by the Justice Department, concerning the PACE (Professional Administrative Career Examtnatton)-the baste entry level exam for professionals wanting federal jobs. The PACE exam had been challenged in court by minorities who claimed the test favors whites because of their background. Instead of revising the test to eliminate any unfair questions, the government offered to guarantee that the number of blacks and Hispanics who would get jobs would be proportional to the number who took the test--or else the test would be rewritten until it produced that predetermined result. That is, if half the people who took the tests were black or Hispanic, then half the available jobs would have to go to blacks or Hispanics for the test to stand.

The question is whether this mechanism, as it has come to operate in practice, is simply a legal device to break down the barriers of prejudice, or a blunt instrument of intimidation, leading in many cases to frivolous charges and litigation, whose costs in terms of a functioning government overwhelm any contribution it may make to opening up jobs for truly competent and qualified minorities and women. Listening to federal managers frankly discuss their experiences--something most are willing to do only after guarantees of anonymity-suggests that the latter is the case.

THEY'RE NO'l' OUT THERE

An executive in the Department of Health and Human Services described the current atmosphere this way:

"Affirmative action bas overwhelmed consideration of fairness and efficiency ln the thinking of a federal manager. Each agency has its own 'equal opportunity' bureaucracy that can justify its existence only by keeping the fires hot. You are constantly on the defensive, it's on everybody's mind, and when the subject comes up you feel compelled to cite how many women you've hired, how many minorities you've promoted. Any second thought, any questioning of the thrust marks you as a dinosaur, someone whose future is behind him."

A critical element in the performance appraisal for all fed~ral managers is the "minority hiring and promotion" factor. What the manager is expected to achieve in order fairly general goals of satisfactory ranges from fairly genera.! goals of "improvement in hiring practices" to "target goals-that is, specific numbers of percentages of target groups (women, blacks, Hispanics, etc.) to be hired or promoted. In many fields the scarcity of qualified minorities plus the pressures to meet the quotas creates an impossible situation for the mid-level manager.

The head of one subdivision of a government agency involved in radio broadcasting was told by a recent director of the organization that he expected him to hire a "disproportionate" number of blacks for all subsequent vacancies. By disproportionate, he explained, he meant about ~0 percent. The manager protested that of 190 applicants for the two available e.nnouncer jobs, he could identify only two as blacks and their auditions had not been even close to the passing range.

"I tried to explain to him," said the broadcaster. "I travel around the country. I advertise. I personally have written to 250 radio stations ~king for their cooperation in finding black announcers. Finding women in broadcast journalism is no problem, but blacks are something else again. The total enrollment of minorities-blacks, Hispanics, etc.-in the communications schools nationwide is about 4 percent, way below the average for other professions. There are damn few black males going into this business. I'm competing, when I go out recruiting interns at the universities, with the best newspapers and TV stations. But I'm told when I get back to Washington that 'they're out there, you're just not trying.' I know they're not out there-not for us. I sought out recruits at Southern University, one of the largest black schools in the country, with a large communications department, and at Clark College in Atlanta, a first-rate school. Not one 0f the students applied. At Howard I interviewed 80 or 90 students. One applied. I resent being put on the griddle. Yes, there are applicants that nobody else wants . I resent being: told that for them we should lower the standards. Well, it didn't do any good to explain-he told me that I fill the vacancies with blacks or not at all. The upshot was that the other announcers worked overtime and the taxpayers paid for


it-and I was put in the position of being a damned racist."

Frank Berndt was the general counsel of the National Highway Trame Safety AdminIstration, a job he had held since 1975. Since that time, his office had hired 30 lawyers, 19 men and 11 women, of whom two were black. "It's easier fbr me to get highly qualified women out of the law schools," Berndt told the Washington Post. "With minorities it's harder. The competition for them is fierce." The .reason Berndt was talking to the Post was that he had become the central figure in an unpleasant fiap. His boss, Joan Claybrook, had put Berndt in for one of the bonus awards now available to senior executives. The Department of Transportation's selection board vetoed the award without explanation. But after gossip leaked out that the EEO office had axed the award on the grounds that Berndt had a lousy amrmative action record, the office admitted killing it. But, said the EEO official, he took the action not because Berndt's minority hiring record was bad-but because it was only "ordinary."

An executive in another government department, who was asked to organize a toplevel consulting staff, spoke of the shoals he ran into:

"My job was to put together a staff of 18, comprised of the best professional talent available. Once this wonderful vision had been laid out, the realities struck home. After having taken on four people, I was told flatly that although there wasn't exactly a quota, if I didn't get more women and minorities immediately I wouldn't be permitted to complete the staffing. I had 4 out of the 18 and the music stopped. Now, the fact is that available blacks in the professions are in short supply. So since you a.re under terrific pre86ure to assemble a st·aff with the precondition of affirmative action, you find yourself in a bidding situation. The candidates come to you and they make demands. They tell you that they are being interviewed by a number of agencies, they want to know when promotions will come, where they will sit, what perks they will have-and they are in a position to say that they'll only come if the price is right. You find that you really have to scramble to prevent their walking out the door.

"Well, I was in a very awkward situation. I needed people in substantive professional areas who had been in government at a fairly senio.r level for some time. And there, women-and particularly minorities-are scarce. And, finally, what you do, facing reality, you accept people who are the best of a very uncertain lot. I believe in upgrading people, not downgrading standards, but that's not where it is today. People get sent around from the Director's office with a 'Must Hire' tag on them. I have so far filled eleven .of the jobs--6even of them with 'targeted' people. In the affirmative action element of my performance rating I was graded •outstanding: But whether the people I've put on staff are adequate is another story. The point is that the emphasis isn't on qualifications, it's on the quota."

GS-14 BY RIGHT

The emphasis on race or sex rather than performance, and the explicit rules and implicit fears by which it is enforced, can wreak havoc in a large organization even after the initial hiring decision is made. That, at any rate, was the point a lawyer in relatively new section of a large federal agency was trying to make when he related this experience:

"Jim Borman was one of the original employees hired when this unit was set up. Although his credentials weren't super-he had an M.A. in urban planning from one of those degree-by-mail mills-that was glossed over

in the interests of 'affirmative action.' Jim came on as a GS-11. The following year he asked for and received promotion to GS-12, although the fact is he had been a disappointment. His performance was poor and he had the kind of crummy attendance record-lots of 'sick' absences on Fridays and Mondays--that is more common in your clerical than professional staff. Nevertheless, after a year at GS-12, he asked for promotion to GS-13 [current starting salary, $26,951) and he also asked that he be reimbursed for law school courses he had begun to take at night.

"By that thrte he had come under my supervision and on the basis of performance I couldn't go along with the promotion. I also had to turn down his request for reimbursement, since the courses he was taking were not related to our work. Meanwhile, our unit was growing and Borman was transferred to another supervisor to whom he made the same requests with the same results. He then filed a grievance charging race discrimination in the fall of 1977. The case stayed in our agency but went through various phases over a period lasting three years. The department hired outside counsel and so did Borman.

"If it was difficult to supervise Borman before-he is intelligent but very defensive-it was now impossible. He did virtually nothing during those three years except work on his case behind closed doors--you know, keeping records, making calls and so forth. Any assignment his supervisor tried to give him. he regarded as an attempt to obstruct his preparation, and would make notes accordingly. Meanwhile, Borman finished law school and now he increased his demands: he now insisted on a promotion to GS-14 [starting salary, $37,871], on the grounds that if he had been promoted to a 13 when he felt he deserved it, by this time he could have been promoted again. Also, he wanted to be classified as a GS-14 lawyer. You get the picture?-a fellow with no legal experience at all, while at the same time we have lawyers in the department with six or eight years' experience who have been at the GS-13 level for five or more years. Well, how do you think it came out? The finding in the case was that there ·had been no discrimina~ tion-but everyone's afraid of an affirmative action stigma, so all of Borman's demands were met anyway: retroactive promotion to GS-14 lawyer with back pay, reimbursement for law courses, and reimbursement for his legal fees.

"Do you realize what that does to the morale of the other professionals in our section? The hostilities it creates? And how it cheapens the success of those blacks who make it because they really have it? And there is something else here that is the Achilles heel of the whole affirmative action program-which is that it's only natural that a person who knows his strong card is not his qualifications for the job but his special status will press his advantage for an it's worth. And you can't run a railroad that way."

MANAGEMENT BY OBJECTIONS

Beyond how all that affects the cost of running the federal government, the atmosphere created by defining people in terms of race hea!vily burdens the possibility of decent working relationships. Many of the equal opportunity officials within each agency-usually themselves minority members--are minimally qualified for this delicate work; their belief that any problems involving minority hiring and promotion are a matter of prejudice and foot-dragging on the part of bigots is inevitably absorbed by the people it is intended to help. At the lowest levels the effects may be seen in the

widespread surliness of office workers. (Conversation overheard in a Department of the Interior elevator: "Hey, Mora, Donovan wants that letter typed up this afternoon." Yeah? Well tell Donovan to go f- himself." ) These attitudes, of course, find particularly fertile soil in the civil service culture where the fear of job loss is nonexistent, and supervisors are impotent. At the higher level the effect is more subtle. Another federal executive:

"When, because of the pressure, you take on underqualified minority people you haJVe another problem. I've found that any effort to provide guidance creates a very sensitive situation. In my work we have to provide polished reports. If I have someone whose writing is sub-par and I suggest that I'd like to enroll him in a free civil service course in writing style, his immediate reaction is one of suspicion: 'Are you saying that I write ghetto English?' or 'Are you suggesting that I went to the wrong school?' Because of the atmosphere, attempts to bring someone along appear to have racial overtones. You find yourself walking on eggshells and you face the possib111ty that he will file a grievance.

"You run into the same thing when you want to reward people who have done a good job. The quota mentality is so heavy in the air that when thinking of cash awards or commendation or promotions you have to figure out how you can balance things on a race and sex basis--and hope that there will be something left for the most deserving people. You end up having to toss something here, something there, even though it's not appropriate, just to be able to keep control of your staff."

Added to these feelings of frustration for many mid-level managers is the conviction that their own career horizons have closed in on them. The Nirvana they look forward to-admittance into the Senior Executive Service-has become appreciably less attainable.

"I don't like to talk about it," said one manager who felt he was stymied in his career, "because it sounds like sour grapes. But I'm just part of a pattern that exists throughout government. I know a whole bunch of GS-15s in their middle to late forties or just turning 50 who had expected some day to be in top management posts. But these days the name of the game is minorities and women, and white males are reduced to telling bitter jokes (for example, Man tells wife he is contemplating sex change operation. 'But. dear,' she says in dismay, 'Then what if you don't get the promotion'). You see, the career corps of SES is made up primarily of long-timers who have been in for 20 or 30 years. Given the employment pattern of that era, they are mostly white males. So the heat is on to hire women and minorities to alter drastically the statistics."

LEPERS

The zeal of the affirmative action crusade has blended with the tactics of the earlier antidiscrimination movement to produce a mass of litigation-affecting small businesses, giant corporations and governmentcharging discrimination on one basis or another. Discrimination on the basis of sex is, next to age discrimination, the fastest growing charge; last year there were seven times as many such charges as in 1970. (During the same period charges of race discrimination rose by a multiple of four .) It is impossible to say how many of these cases have merit as opposed to those that are frivolous or vindictive. What is clear is that in government the litigation involved has an inhibiting and destructive effect on those man-

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22587 agers who would like to devote their energies to trying to make their organizations work. It's not hard to see why . . .

In September, 1976, Dorothy Crook, the editor of a magazine published by the U.S. International Communication Agency, received a letter from a young women employed as a GS-5 in another government agency, inquiring about the possibility of transferring to USICA at the same level but in an editorial capacity. The woman was a graduate of Barnard College as was Crook, who, as part of the Barnard women's network, was pleased to lend a helping hand. Although she had no openings on her staff, she had a chat with her young fellow alumna. Crook then called Robert Korengold, a colleague who edited another USICA maga:zine, and ask him whether he would talk to the woman. Korengold was reluctant, explaining that he had no openings either, but he agreed to see her as one of those things you do to oblige a colleague. In that spirit, Korengold spoke with the woman in what he considered a counseling sessionhow to break into magazine work-rather than a job interview. Near the end of their talk, Korengold mentioned that a GS-12 position that called for six years' experience would be opening in a few months, one for which he told her, according to his subsequent deposition, she was in no way qualified.

Put yourself in Korengold's position for a moment. You have not called the woman into your office to destroy her hopes, but to be friendly. The last thirig you want to tell her is "look, you're not good enough for this work." It is an embarrassing situation for most people, especially the soft-hearted ones-and a situation that usually produces a feverish mental search for an excuse that wm allow you to turn someone down while leaving their self-esteem intact. Uncomfortably for those federal managers caught in this situation, the list of permissible excuses has shrunk considerably in the last two decades, and the one Korengold chose was a blunder: he added that since his professional staff consisted of ten women and only two men, he'd lean toward hiring a man for the sake of editorial balance.

Needless to say, the young woman then charged that she was rejected on the grounds of sex. She initiated litigation which, almost four and a half years after the original interview, is still going on. The file of court papers, now about six inches high, gives only a hint of the incredible number of hours that USICA officials and editors have put into documenting the information required by the attorneys for both sides. Understandably, agencies are apprehensive of becoming involved in such litigation-because of t'he stigma attached as well as the time consumed.

Official eagerness to steer clear of such headaches adds to the affirmative action pressures laid on federal managers, and to their proneness to treat as lepers any managers unfortunate enough to have a finger pointed at them ....

One day in 1979, Bradley Jones, head of a small government chemi!':try lab, learned that his chief assistant was leaving for another job within a month. Jones began actively looking for a replacement. Among the many resumes from men and women that he reviewed, one that impressed him was from a woman we can call Elizabeth Bolton. He <interviewed Bolton, who was then employed in a d,ifferent agency, and he was satisfied! that she was, indeed, his candidate. Jones put Bolton in for "clearance," a cumbersome process still required in so-called sensitive agencies and one that managers don't initiate without a defin1te intention to

hire the applicant. After being cleared, Bolton came in to see Jones and informed him that she was pregnant but would like to take the job on a part-time basis. Jones told her he was sorry but that his need was for a fulltime a.ssis·tant and she'd have to take it on that bssts if she wanted it.

Shortly afterward, Jones was notified that Bolton was bringing suit against him and his agency for violating the law by refusing to hire a pregnant woman. She claimed that contrary to Jones's version she would have taken the job full-time after a period of part-time employment. When he spoke to the Agency attorney about a defense against the charge, Jones received another jolt. The Agency, not wishing to get involved in a sex discdmination case, had arrived at a settlement with Bolton that involved a job offer (which she refused) and a payment of some money (t'he difference between her current salary and the larger salary she would have received as Jones's assistant). Further, the attorney told Jones, the Agency had agreed to prosecute the case against him, and he would do well to hire his own attorney. Facing dismissal or suspension without pay, Jones did hire a lawyer. There ensued a series of hearings conducted by the Equal Opportunity office of the Agency during which, Jones recalls with bitterness, his account of the interview was given no credence nor was he given any opportunity to confront his accuser. The upshot was that Jones received a reprimand which is now part of his record, and he was out of pocket $1,800 for legal expenses.

You might expect Ronald Reagan to change all this. After all, he and his followers have never been advocates of affinnative action. Indeed, they do not even seem to understand the legitimate purpose behind itthe need to prevent those who have jobs to offer from slipping back into their comfortable networks of (mostly) white males, to make them reach beyond to find and develop the talent that is out there. So it is possi·ble that the incoming administration not only wm try to control the excesses of the program, but that in the process they wm rip out its heart.

What is more likely, however, is that they wm soon realize they can neither afford to antagonize an affirmSJtive action lobby ready to pounce on any sign of Republican "insensitivity," nor arrest the enormous bureaucratic and judicial momentum behind the program. So they wm content themselv~s with repeating conservative hom111es, whtle those federal managers who care about their work will continue to be demora.Uzed by a system that adds-to the already formidable obstacles to getting anything done in the government-the burden of trying to get it done with people chosen, not because they are the best, but because they can threaten a lawsuit or fill a quota.

NOTICE OF DETERMINATION BY THE SELECT COMMITTEE ON ETHICS Mr. WALLOP. Mr. President, it is re

quired by paragraph 4 of rule 35 that I place in the CONGRESSIONAL RECORD this notice of a Senate employee who proposes to participate in a program, the principal objective of which is educational, sponsored by a foreign educational or charitable organization involving travel to a foreign country paid for by that foreign organization.

The Select Committee on Ethics has received a request for a determination under rule 35 which permits Ms. Beverly

K. Hubble of the staff of Senator GRASSLEY to participate in a program sponsored by a foreign educational organization, Soochow University in Taipei, Taiwan, on October 5-11, 1981.

The committee has determined that Ms. Hubble's participation in the program in Taiwan, at the expense of Soochow University, to discuss relrutions between the United States and the Republice of China, is in the interests of the Senate and the United states.

ASKING THE COAST GUARD TO DO MORE WITH LESS

Mr. PELL. Mr. President, as a result of an Executive order issued yesterday by the White House, the Coast Guard has been given the added burden of stopping the flow of Haitian refugees now entering the United States illegally by sea. Regardless of the merits of the President's decision, it is obvious that yesterday's Executive order imposes a heavy responsibility on the already overburdened Coast Guard. It is another example of the haphazard way in which new missions have been heaped upon the shoulders of the Coast Guard without consideration being given to providing the service with adequate equipment and manpower to get the job done.

The Coast Guard's performance in a number of key areas has markedly declined in recent years as a result of the failure of the Coast Guard's budget to keep pace with the tremendous increase in the service's responsibilities. The cuban and Haitian exodus in 1980 created a severe drain on the Coast Guard's limited resources, and resulted in a further decline in the service's ability to handle its primary missions. Now, the Coast Guard estimates that it will require at least $1 million a month in additional operating expenses alone to carry out the Executive order issued yesterday by the White House. Added to this cost will be the diversion of men, ships, and helicopters from vital primary missions. You just do not get something for nothing. The failure to provide offsetting resources will have a particularly severe effect on missions which have already been cut back because of inadequate resources, such as fisheries law enforcement and marine environmental pollution control activities.

Mr. President, I believe that the President's action in regard to the Haitian problem, completely apart from the merits of the plan, reflects the foolhardiness of some of the administration's budget cutting proposal. At the same time the administration is asking the overtaxed Coast Guard to do more. absolutely no consideration is being given to the need to provide the adequate resources to get the job done.

The size of the Coast Guard's fleet has declined by one-third in the last 10 years, and the remaining ships are aging and decaying rapidly. Many Coast Guard cutters, including one I served on prior to Pear Harbor, are more than 40 years


old and still in service. Our failure to make the needed capital investments has left us with probably the oldest .fleet of any Coast Guard or Navy in the world. To overcome this capital equipment backlog, I have recommended that the Coast Guard's capital budget be doubled in 1982 to $750 million, with this increase sustained-adjusted for inflation-for the next 10 years. Without this capital investment to overcome the neglect of the past, I believe we will inevitably see an even sharper fall-off in the Coast Guard's perfonnance.

Yet, just last week, the administration required the Coast Guard, like other nondefense agencies, to reduce its 1982 budget by 12 percent. In the context of the Haitian mission announced yesterday, this type of budget cutting is an example ·Of asking the Government to do more, at the same time we are giving Government-in this case the Coast Guard-less and less with which to get the essential jobs done.

ORDER FOR RECESS UNTIL 11 A.M. Mr. BAKER. Mr. President, I ask

unanimous consent that when the Senate compietes its business today it stand in recess until the hour of 11 a.m. tomorrow.


The Senator from Maryland.

SENATOR CHAFEE ON THE TAX BILL Mr. MATHIAS. Mr. President, I re

cently had occasion to read in the Boston Globe an article written by our colleague, the Senator from Rhode Island <Mr. CHAFEE) concerning the tax reduction bill passed by Congress this summer.

Senator CHAFEE's article concerns what he terms the pitfalls he believes American business and industry must avoid if they are to retain public con.fldence following enactment of this sweeping change in the U.S. Tax Code.

Noting that very generous concessions will .flow to industry as a result of the new tax law, Senator CHAFEE cautions that if these resources-are squandered and wasted ... then a backlash will develop and a new round of anti-business sentiment will sweep the country.

Senator CHAFEE's article, Mr. President, provides a thought-provoking analYsis of the dangers which will be faced by the business community if it fails to use wisely the great sums of money to be made available by the tax cut bill. I commend this article, which appeared in the August 28, issue of the Globe, to all Senators, and ask unanimous consent that it be printed at this point in the RECORD.

There being no objection, the article was ordered to be printed in the RECORD, as follows: Now THEY HAVE THE TOOLS ... GET ON

WrrH THE JOB (By JOHN H. CHAFEE)

The tax cut bill just signed by President Rea.gan can truthfully ·be called tbe &nswer

to any general's dream-General Motors. General Tire, General Electric and General Mills, to name just a few.

Indeed, if the Business Roundtable had drawn its own bill, it could hardly do much better for its self-interest than the one congress passed: more rapid depreciation on all equipment and buildings; tax credits for increased research and development; stock options to warm the hearts and swell the purses of management; relief for Americans working a.broad; cuts in capil.ta.l gains taxes; a provision for truckers to write off the value of route certificates; and a 50 percent cut in the windfall profits ·tax on "new" oil.

Congress passed this b111 because we think the federal tax burden on American industry has been a major factor in the frequent inab111ty of the United States to compete in world markets. The formal name of the blll-"The Economic Recovery Tax Act of 1981 "-reflects this concern.

Yet, it is also true that many in Congress-myself included-belleve American industrialists of the past 10 years have been too quick to blame factors CYther than their own shortcomings for the sagging fortunes of many sectors of our economy. Whether it's the fuel-efficient automobile, the radial tire, stereo equipment or reasonably priced steel, foreign firms have been able to produce what we couldn't--or wouldn't.

American businessmen have seemed far more capable of producing a better hamburger or pizza than they have been at building better automobiles.

But now is the time to look to the future. Industry asked for this b111; now let us see it perform. The ball is in its court.

Industry has been given an opportunity to renew its plants, to develop new products and to meet the challenge of its own rhetoric: "Give us the tools, we'll do the job." But if this opportunlty is abused, then a fickle public with its equally fickle representatives wm lose confidence in American business. Industry w111 come to be seen as a predatory target upon which it is perpetual open-hunting season.

To avoid this fate, business should take care to avoid these pitfalls:

There must be no more whining supplications for "special quotas" against those wicked imports. If American business can't compete on its own turf, it doesn't belong in the ballgame.

Industry must not .squander its new depreciation dollars on exorbitant execut.lve perks, bloated salaries or substantially increased dividends. We were promised that faster depreciation would mean renewed plants and equipment. Let's see it.

The proceeds of these cuts must be used to plan and design for the long haul. Too often the short-term goal is the hallmark of American business; research and development are too often given short shrift.

Business must bear in mind that public hostility will certainly mount if we see a new round of corporate mergers along the lines of the recent $7 b1llion bidding war for Conoco. Right or wrong, the public perception of such spectacles is one of corporate arrogance, of business more concerned with massing new power than in building better and more efficient products. Public confidence in industry was hardly enhanced by the sight of Mobil, the Nation's secondlargest oil producer, scorning the antitrust laws as it made its bid for Conoco, the Nation's ninth-largest oil company.

If business is perceived by the public and Congress as using its new tax <:oncessions to build plants, to invest in equipment, to create more jobs, then business will enjoy publlc <:onfidence.

But if the resources now available are squandered and wasted and if business ignores the pitfalls cited above, then a back-

lash will develop and a new round of antibusiness sentiment will sweep this country.

Since the trust-busting days of Teddy Roosevelt, Americans have harbored a deepseated suspicion of business, especially big business. It still lurks out there, deep in the American psyche.

If that skepticism is to be put to rest, American business must prove itself worthy of the trust this tax bill presupposes.

The PRESIDING OFFICER. The Senator from California.

·Mr. HAYAKAWA. Mr. Pres-ident, may we have order? ·

The PRESIDING OFFICER. The Chair requests order in the Senate. The Senator from California is recognized.

AWACS

Mr. HAYAKAWA. Mr. President, on tih.e eve of the appearance of 6ec·retary Haig and Secretary Weinberger before the Foreign Relations Committee to discuss the proposed sale of AWACS and the F-15 enhancement package to Saudi Arabia, I would like to notify my collegues of my in'tention to introduce legislation on Monday which relates to th1s sale.

It is no secret that I, as well as many of my colleagues, have deep concerns and serious reservations aJbout the proposed sale. On June 18, I held a press conference in Which I listed some of the problems I saw in the propos:aJ. as it was being described. And I said that I was opposed to tih.e sale but that I would approa.ch the question with an open mind.

On Monday, September 14, Mr. Richard Allen, the President's National Security Adviser, and his technical experts, came to my office to discuss with me the proposed sale of AWACS to Saudi Arabia. I expressed my concerns over the matter and submitted a numlber of questions to him. Mr. Allen promised to get back to me with 'the answers. At the close of our meeting, I felt tJhat he was aware o'f my deep reservations; he indicated that he W'Ollid communicatte them to the President.

I have yet to hear from the administration. And I still have serious concerns about the technical aspects of the sale. However, the more people I have talked to, with my collea;gues in Con~ess and with my constituents, the more questions I have. I am disturbed at the direction we are takin~. It s~?eml'l to mel! that this whole matter has come down to a yes-orno issue. The result is bound to be victory for one side and humiliation for the other-the United States being the loser in either case.

I have thought long and hard about the historical, cultural, and strategic aspects. And it seems to me that there are t.hree basic issues in this whole matter. The St.ate of Israel is the strongest democratic ally the United States has in the Middle East: Most of Israel's neighbors do not even recognize Israel's rillht t.o e~ric;t. n. seems to me that from the Israeli point of view, there cannot be peace in the region until they are accepted as a member of the Middle East community.


The Saudis are also our friends and have demonstrated their willingness to work as a partner with the United States not only as an oil supplier, but also in providing economic assistance to other moderate states and in its diplomatic role in negotiating the recent cease-fire in Lebanon. However, the Saudis are a member of the Arab community and as such share their concern about the Palestinian question. And from the Saudi point of view, until this issue is resolved there cannot be peace in the region.

The third basic issue is the national security interests of the United States. Secretary Haig in testimony before the Foreign Relations Committee on September 17 said, and I agree-

What is a.t stake is this nation's capacity to develop a stra.tegy that ca.n move the peace process forward and protect our vital interests in an unstable area. exposed not only to historic Arab-Isra.eli rivalries but increasingly to threats from the Soviet Union and its proxies.

Starting tomorrow and probably during the remainder of the month, we will continue to hear about these threats to the Persian Gulf region and justifications for the sale, as well as the threat this sale will im·pose on Israel's security.

It is my desire that the formal notification on the proposed sale of arms to Saudi Arabia will o1fer alternatives, including diplomatic initiatives by one or more of the continuing parties.

I want Saudi Arabia to have adequate defenses. But I do not wish to increase Israel's fears. Both are surrounded by enemies, real and potential. A just compromise must be worked out to make both nations feel more secure-and thereby relieve tensions in the entire Middle East. However, at this late hour, the Senate has received no answers from the administration that such a compromise will be included in the package.

Therefore, the legislation I will propose on Monday contains provisions that should the sale go forward the President should notify tbe Senate 60 days prior to the delivery of the first A W AOS or any other part of the package, of his determination to what extent the Saudis are continuing their moderate policies, their diplomatic role in fostering peace and stability in the Middle East and their e1fort at participating in a negotiated peace settlement in the Middle East which would amrm Israel's right to exist. And should the Senate find that the Saudis are no longer carrying out these policies, it is the intent of the Senate to consider and take steps to enact legislation prohibiting the delivery of these arms.

Mr. President, I think it is time that we in the Senate play a role in developing a strategy that can move the peace process forward. I believe my legislation will give us the options we have all been looking for.

As I said. I want Saudi Arabia to have adequate defense. I do not wish to increase Israel's anxiety. I thank the Chair.

Several Senators addressed the Chair. The PRESIDING OFFICER. Who

seeks recosmftion? Mr. BAKER. I yield to the Senator

from Washington.

ANNOUNCEMENT OF POSITION ON VOTE NO. 299

Mr. GORTON. Mr. President, at the time this afternoon when there was a motion to table the Tsongas amendment, I was unavoidably detained in the House. I ask unanimous consent that the record refiect at the appropriate point that had I been present I would have voted in favor of the motion.


UNANIMOUS-CONSENT REQUESTUP AMENDMENT NO. 456

Mr. HUMPHREY. MT. President, I have a unanimous-consent request concerning the foreign assistance bill.

I ask unanimous consent that technical changes may be made to the Humphrey amendment to the foreign assistance bill .t·o bring it into conformance with the language on the desk.

Mr. ROB:ERT C. BYRD. Mr. President, reserving the right to object, that has been cleared on this side of the aisle.


ORDER FOR RECOGNITION OF CERTAIN SENATORS ON TOMORROW Mr. BAKER. Mr. President, I ask

unanimous consent that, after the recognition of the two leaders under the standing order on tomorrow, the following Senators be recognized on special orders of not to exceed 15 minutes each: The Senator from Vermont <Mr. LEAHY) , the Senator from Missouri <Mr. EAGLETON), the Senator from New Jersey <Mr. BRADLEY) , the Senator from Massachusetts <Mr. KENNEDY) , the Senator from West Virginia (Mr. ROBERT C. BYRD), the Senator from Tennessee <Mr. BAKER), and the Senator from Pennsylvania. (Mr. SPECTER).


ORDER DESIGNATING PERIOD FOR THE TRANSACTION OF ROUTINE MORNING BUSINESS ON TOMORROW Mr. BAKER. Mr. President, I ask

unanimous consent that, after the recognition of the two leaders under the standing order and the Senators under the special orders just entered, there be a brief period for the transaction of routine morning business to extend no longer than 10 minutes in which Senators may speak for 2 minutes each.


CONTINUING IN EFFECT ANY AUTHORITY PROVIDED UNDER THE DEPARTMENT OF JUSTICE APPROPRIATION AUTHORIZATION ACT, FISCAL YEAR 1980, FOR A CERTAIN PERIOD Mr. BAKER. Mr. President, this has

been cleared on the other side of the aisle. I ask unanimous consent that the Senate proceed to the consideration of

H.R. 4608, an act to continue in e1fect any authority provided under the Department of Justice Appropriation Authorization Act, fiscal year 1980, for a certain period, and for other purposes, and I ask unanimous consent that :first and second readings be dispensed with.

The PRESIDING OFFICER. Without objection, it is so ordered. The bill will be stated by title.


A blll (H.R. 4608) to continue 1n effect any authority provided under the Department of Justice Appropriation Authorization Act, fiscal year 1980, !or a. certain period, a.nd tor other purposes.

The Senate proceeded to consider the bill.


(Purpose: To change the effective date o! H.R. 4608 from 6 months to 4 months)

Mr. BAKER. Mr. President, I send an amendment to the desk on behalf of the Senator from South Carolina <Mr. THURMOND).



The Senator !rom Tennessee (Mr. BAKER) on behalf of Mr. THuRMOND, proposes unprinted amendment numbered 459.

On page 2, line 1. strike "April 1, 1982" and insert in lieu thereof "November 1, 1981."



The PRESIDING OFFICER. The bill is before the Senate and open to further amendment. If there be no further amendment to be proposed, the question is on the engrossment of the amendment and third reading of the bill.

The amendment was ordered to be engrossed for a third reading and was read the third time.

The PRESIDING OFFICER. The bill having been read the third time, the question is, Shall it pass?

The bill <H.R. 4608) was passed. Mr. BAKER. Mr. President, I move to

reconsider the vote by which the bill was passed.

Mr. ROBERT C. BYRD. Mr. President. I move to lay that motion on the table.


BILL HELD AT DESK Mr. BAKER. Mr. l?resident, I ask

unanimous consent that H.R. 4048 be held at the desk until the close of business tomorrow, October 1.


JOINT REFERRAL-S. 1541 Mr. BAKER. Mr. President, I ask

unanimous consent that the bill S. 1541, the so-called ERISA bill, be jointly referred to both the Finance Committee and the Labor and Human Resources Committee.



REIMBURSEMENT OF COMMERCIAL FISHERMEN FOR CERTAIN LOSSES Mr. BAKER. Mr. President, I ask that

the Chair lay before the Senate a message from the House of Representatives on S. 1191.

The PRESIDING OFFICER laid before the Senate the following message from the House of Representatives:

Resolved, That the bill from the Senate (S. 1191) entitled "An Act to extend for 1 year the authority of the Secretary of Commerce to reimburse commercial fishermen of the United States for certain losses incurred as the result of the seizure of their vessels by foreign nations", do pass with the following amendments: ,

Strike out all after the enacting clause, and insert: That section 7 of the Fishermen's Protective Act of 1967 (22 U.S.C. 1977) is amended-

( 1) by adding immediately after the fourth sentence of subsection (c) the followin~ new sentence: "Those fees not currently needed for payments under this section shall be kept on deposit or invested in obligations of, or guaranteed by, the United States and all revenues accruing from such deposits or investments shall be credited to such sepa.rate account."; and

(2) by striking out "The provisions of this section shall be effective until October 1, 1981; except that payments" in subsection (e) and inserting in lieu thereof "Payments".

Amend the title so as to read: "An Act to give permanent effect to the provisions of the Fishermen's Protective Act of 1967 relating to the reimbursement of United States commercial fishermen for certain losses incurred incident to the seizure of their vessels by foreign nations; and for other purposes.".

UP AMENDMENT 460

(Purpose: Amendment in the nature of a substitute)

Mr. BAKER. Mr. President, I move that the Senate agree to the House amendments with a further Senate amendment, which I send to the desk on behalf of Senator GoRTON.



The Senator from Tennessee (Mr. BAKER), for Mr. GORTON, proposes an unprinted amendment numbered 460.

Mr. BAKER. I ask unanimous consent that further reading be dispensed with.


The amendment is as follows: Strike all after the enacting clause and

insert in lieu thereof the following: "That section 7 of the Fishermen's Pro

tective Act of 1967 (22 U.S.C. 1977) is amended-

" ( 1) by adding immediately after the fourth sentence of subsection (c) the following new sentence: 'Those fees not currently needed for payments under this section shall be kept on deposit or invested in obligations of, or guaranteed by, the United States and all revenues accruing from such deposits or investments shall be credited to such separate account.'; and

"(2) in subsection (e), by striking out 'October 1, 1981' and inserting in lieu thereof 'October 1, 1984'.

"SEc. 2. (a) (1) The first section of the Act of June 29, 1935 (relating to certain seagoing vessels) (46 U.S.C. 367), as amended, is further amended by striking

'January 1, 1983' and inserting in lieu thereof 'January 1, 1988'.

"(2) Section 10(c) of the Act of May 28, 1908 (relating to seagoing barges) (46 U.S.C. 395(c)) is amended by striking 'January 1, 1982,' and inserting in lieu thereof 'January 1, 1988,'.

" ( 3) The last sentence of section 4426 of the Revised Statutes of the United States (46 U.S.C. 404), as amended, is amended by striking 'January 1, 1983' and inserting in lieu thereof 'January 1, 1988'.

" (b) For the purposes of section 9 of the Rivers and Harbors Appropriation Act of 1899, as amended (33 U.S.C. 401), the portion of the Green River in the State of Washington lying upstream from that State Highway 516 bridge which is in existence on the date of enactment of this Act is hereby decLared oto be not a navigable waterway.''.

Amend the title so as to read: "A blll to extend for three additional years the provisions of the Fishermen's Protective Act of 1967 relating to the reimbursement of United States commercial fishermen for certain losses incurred incident to the seizure of their vessels by foreign nations; and for other purposes.".

• Mr. GORTON. Mr. President, I would like to explain the provisions of section 2 of S. 1191.

For many years the administration of inspection laws by the Coast Guard and its predecessor, the Steamboat Inspection Service, deemed cannery tender, fishing tender, powered and non powered processing vessels to be the same as fishing vessels. However, in 1962, the Coast Guard announced its intention to reverse this longstanding treatment of these unique vessels and to require their inspection, compliance with loadline requirements and with statutes regarding the transport of fishery related caTgo and personnel.

In 1968 following extensive hearings in both the Senate and House as to the use of these vessels in the fishery, the Congress passed legislation which exempted them for a period of 5 years from requirements of sections 367, 395 and 404 of title 46. In 1973, on the expiration of the original exemption, the Congress again considered the use of these vessels and as a result extended the exemption for an additional 5 years. Upon the expiration of this exemption in 1978, the Congress again reviewed the vital need for these vessels in the fisheries of Oregon, Washington, and Alaska and extended their exemption until January 1, 19813, except for nonpowered processing vessels which, because of a drafting error, were only exempted until January 1, 1982.

The cannery tender and fishing tender vessels have two distinct uses. The first is the transport of flsh from fishing vessels to processing plants. Second, they are used to transport cargo to or from vessels in the fishery or a facility used in the processing or assembling fishery products or the transport of processing or fishing personnel to or from operating locations.

The powered and nonpowered processing vessels of not more than 5,000 gross tons are used to process or assemble fishery products in "the fisheries of Oregon, Washington, and Alaska"-a term that includes, because of practice and congressional intent, the fishing and

support activities inside the territorial waters and in the fishery conservation zone adjacent to these states.

Typically, these vessels depart from Oregon and Washington for Alaska and carry fishing and processing supplies, including food, to the remote areas. Because of the geography of Alaska with its 5,580 miles of coastline, tender vessels are often the only source of carriage of processing and fishing supplies to remote areas of the State. These vessels are not used for the transport of cargo or personnel outside of the fishing industry. Also, the powered and nonpowered processing vessels are often the only processing facilities available in remote areas. The present bill provides for another 5-year extension of these inspection exemptions, and this action is supported by the Coast Guard.

The second part of section 2 addresses a bureaucratic tangle caused by the Coast Guard's insistence on issuing a permit for a bridge across the Green River in Washington State. This amendment declares an upstream portion of this river as nonnavigable-which in fact it is-thus making sure a Coast Guard permit is not required.

The Coast Guard's declaration of mwigability is a frustrating bureaucratic impediment that can serve no useful function. The Coast Guard's concern is over navigability-but the river is clearly not navigable for any sort of commerce; there are bridges both upstream and downstream from the proposed bridge which are lower; the project will not affect the course or channel of the river in any way, and on top of this the Army Corps of Engineers-which had authority to administer 33 U.S.C. section 401 until 1966-stated that no permit was necessary under 33 U.S.C. section 403-section 10 of the Rivers and Harbors Act-because the Green River in the vicinity of Kent was not a navigable water of the United States over which the corps had Rivers and Harbors Act jurisdiction. This Corps of Engineers determination clearly conflicts with the Coast Guard's declaration of navigability.

This amendment will end this bureaucratic holdup, which because of inflation is costing the taxpayers $100,000 per month in higher project costs.•

The PRESIDING OFFICER. Without objection, the motion to concur is agreed to.

OVERSEAS PRIVATE INVESTMENT CORPORATION AMENDMENTS ACT OF 1981 Mr. BAKER. Mr. President. I ask that

the Chair lay before the Senate a message from the House of Representatives on H.R. 3136.

The PRESIDING OFFICER laid before the Senate the following message from the House of Representatives:

Resolved, That the House agree to the amendment of the Senate to the bill (H.R. 3136 entitled "An Act to amend the Foreign Assistance Act of 1961 with respect to the actlvltles of the Overseas Private Invest-


ment Corporation", with the following amendment:

In lleu of the matter inserted by the sald amendemnt, insert:

SBOB'l TITLE SECTION 1. Thls Act may be cited as the

"Overseas Private Investment Corporation amendment, insert:

CREATION, PURPOSE, AND POLICY SEC. 2. section 231 of the Foreign Assist

ance Act of 1961 (22 U.S.C. 2191) ls amended-

(1) in paragraph (2)-(A) by striking out "$520 or less in 1975

United States dollars" and inserting in lleu thereof "$680 or less in 1979 United States dollars"; and

(B) by striking out "$1,000 or more ln 1975 United States dollars" and lnsertlng 1n lleu thereof "$2,950 or more ln 1979 United States dollars";

(2) ln subsection (i) by inserting immediately before the seinlcolon the following: ", and to seek to support those developmental projects having positive trade benefits for the United States"; and

(3) (A) ln subsection (k) by lrtrlklng out "and" after "required by clause (1) ;";

(B) in subsection (1) by striking out the period at the end thereof and inserting ln lieu thereof"; and"; and

(C) by adding at the end thereof the following new subsection:

"(m) to refuse to lnsure, reinsure, or finance any investment subject to performance requirements which would reduce substantially the positive trade benefits likely to accrue to the United States !rom the investment.".

ORGANIZATION AND MANAGEMENT SEc. 3. (a) The first paragraph of section

233(b) of the Foreign Assistance Act of 1961 (22 U.S.C. 2193(b)) is amended-

( 1) by striking out in the ftrst sentence "eleven" and "six" and lnsertlng ln lleu thereof "fifteen" and "eight", respectively;

(2) by inserting after the second sentence the following: "The United States Trade kepresentative shall be the 'vice Chairman of the Board, ex otftcio, except that the United States Trade Representative may designate the Deputy United States Trade Representative to serve as Vice Chairman of the Board in place of the United States Trade Representative.";

(3) by striking out "Six", "six", and "two" in the fourth, fifth, and seventh sentences of such section, as amended by paragraph (2), and inserting in lieu thereof "Eight", "eight", and "three", respectively; ·

(4) by striking out in the fifth sentence of such section, as amended by paragraph (2), "one" the first place it appears and inserting in Ueu thereof "two"; and

(5) by striking out in the fourth sentence of such section, as amended by paragraph (2) . "also serve as a Director" and inserting in Ueu thereof "serve as a Director, ex otftcio".

(b) The second paragraph of such section is amended by inserting "including an otftcial of the Department of Labor," after "United States,".

(c) The amendments made by this section shall take effect on October 1, 1981. INVESTMENT INSURANCE AND OTHER PROGRAMS

SEc. 4. (a) Section 234 of the Foreign Assistance Act of 1961 (22 u.s.c. 2194) is amended-

( 1) in subsection (a) (1) (c) , by striking out "or insurrection" and inserting in Ueu thereof ", insurrection or civll strife";

(2) in subsection (a) C2), by striking out "total" and "financing" at the end thereof;

(3) in subsection (a) (3), by striking out "aUthorized to issue under this subsection" and inserting in lieu thereof "permitted to

have outstanding under section 235(a) (1)"; and

(4) by adding at the end of subsection (a) the following new paragraph:

" ( 4) Before issuing civil strife insurance for the first time, and in each subsequent instance in which a significant expansion is proposed in the type of risk to be insured under the definition of civil strife, the Corporation shall, at least sixty days before such insurance is issued, submit to the Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the House of Representatives a report with respect to such insurance, including a thorough analysis of the risks to be covered, anticipated losses, and proposed rates and reserves.".

(b) Section 234 of such Act is further amended-

( I) in subsection (b), by striking out in the last proviso "authorized to issue under this subsection" and inserting in lieu thereof "permitted to have outstanding under section 235(a) (2)";

(2) in subsection (f) ('1), by striking out "(A)" and by striking out ", and (B)" and all that follows through the end of the paragraph and inserting in lieu thereof a period; and

(3) in the last paragraph of subsection (f)-

(A) by striking out in the second sentence exceed $600,000,000 in any one year, and the amount of such reinsurance shall not"; and

(B) by striking out in the last sentence ", and the Corporation" and all that follows through the end of the sentence and inserting in lieu thereof a period. ISSUING AUTHORITY, DIRECT INVESTMENT FUND

AND RESERVES SEc. 5. (a) (1) Section 235(a) of the For

eign Assistance Act of 1961 (22 U.S.C. 2195 (a)) is amended in paragraph (2) by striking ol4t ": Provided" and all that follows through the end of the paragraph and inserting in Ueu thereof a period and the following: "Cominltments to guarantee loans are authorized for any fiscal year only to such extent or in such amounts as are provided in appropriation Acts.".

(2) Section 235(a) of such Act is further amendedr-

(A) By redesignating paragraphs (3) and (4) as paragraphs (4) and (5), respectively; and

(B) by inserting the following after paragraph (2):

" ( 3) The Corporation shall not make any commitment to issue any guaranty which would result in a reserve less than 25 per centum of the maximum contingent liabil1ty then outstanding against guaranties issued or commitments made pursuant to section 234(b) or siinllar predecessor quaranty authority.".

(b) (1) Section 235(a) (5) of such Act, as redesignated by subsection (a) (2) (A) of this section, is amended by striking out "September 30, 1981" and inserting in lieu thereof "September 30, 1985".

(2) The authority of the Overseas Private Investment Corporation to enter into contracts under section 234 (a) of the Foreign Assistance Act of 1961 shall be effective for any fiscal year beginning after September 30, 1981, only to such extent or in such amounts as are provided in appropriation Acts.

(c) Section 235 (b) of such Act is amended by adding at the end thereof the following: "Notwithstanding any other provision of law, the Corporation shall transfer to the Fund in the fiscal year 1982, and in each fiscal year thereafter-

"(!) at least 10 per centum of the net income of the Corporation for the preceding fiscal year, and

"(2) all amounts received by the Corporation during the preceding fiscal year as repayment of principal and interest on loans made under section 234(c), to the extent such amounts have not been expended or obligated before the effective date of the Overseas Private Investment Corporation Amendments Act of 1981, and the Corporation shall use the funds so transferred to make loans under section 234 (c) to the extent that there are eligible projects which meet the Corporation's criteria for funding.". GENERAL PROVISIONS RELATING TO INSURANCE

AND Gt.T ARANTY PROGRAM SEc. 6. (a) Section 237(f) of the Foreign

Assistance Act of 1961 (22 U.S.C. 2197(f)) is amended by amending the first sentence to read as follows: "Compensation for insurance, reinsurance, or guaranties issued under this title shall not exceed the dollar value, as of the date of the investment, of the investment made in the project with the approval of the Corporation plus interest, earnings, or profits actually accrued on such investment to the extent provided by such insurance, reinsurance, or guaranty, except that the Corporation may provide that (1) appropriate adjustments in t.he insured dollar value be made to refiect the replacement cost of project assets, and (2) compensation for a claim of loss under insurance of an equity investment may be computed on the basis of the net book value attributable to such equity investment on the date of loss.".

(b) Such section is further amended by striking out the last sentence.

DEFINITIONS SEc. 7. Section 238(a) of the Foreign Assist

ance Act of 1961 (22 U.S.C. 2198(a)) is amended by inserting "or commitment" after "includes any contribution".

GENERAL PROVISIONS AND POWERS SEc. 8. Section 239 of the Foreign Assist

ance Act of 1961 (22 U.S.C. 2199) is amended-

(1) in subsection (d), by inserting after the last semicolon the following: "to collect or compromise any obligations assigned to or be held by the Corporation, including any legal or equitable rights accruing to the Corporation;";

(2) in subsection (e)-..LA.) J>y striking out "Auditor-General" each

place it appears and inserting in lieu thereof "Inspector General''; and

(B) by striking out in the first sentence "shall have the responsibility for planning and directing the execution of audits," and inserting in lieu thereof "may conduct"; and

(3) by striking out subsections (f), (j), and (k) and redesignating subsections (g), (h), (i), and (1) as subsections (f), (g), (h), and ~i), respectively.

REPORTS SEc. 9 (a) Section 240A of the Foreign As

sistance Aot of 1961 (22 U.S.C. 22008) is amended-

( I) in subsection (a)(A) by strikmg out "(a)"; (B) in paragraph (1), by striking out

"239(i)" and inserting in lieu thereof "239 (h)"; and

('C) in paragraph (2) (A), by striking out "239(1)" and inserting in lieu thereof "239 (i) "; and

(2) bv striking out subsection (b). (b) The Overseas Private Investment Cor

poration shall prepare and su!binlt to the Congress, not later than June 30, 1982, a report on methods for estimating the probab1lity the.t particular investments or types of investments will or wm not be made if insurance or other support by the COrporation is not provided. The report should 'l"eview methods of taking into consideration the availab1lity of insurance in the private

-

22592 CONGRESSIONAL RECORD-SENATE September 30, 1981 sector as well as the self -insurance capab111ties of investors. The report shall include recommendations on how the Corporation can incorporate consideration of such estim&tes when deciding whiclh investments to support, particularly if not aU applications of eligible investors can be approved. The report shall be based on studies conduoted by persons who are not omcers or employees of the Corporation as well as on studies conducted by the Corporation.

RETURN OF APPROPRIATED FUNDS SEC. 10. Ti-tle IV of chapter 2 of part I of

the Foreign Assistance Act of 1961 is amended by adding at the end thereof the following new section:

"SEC. 240B. RETURN OF APPROPRIATED FUNDS.-The coi1>ora.tion shall return to the general fund of the Treasucy, in a. manner consistent with the objectives set forth in section 231, amounts equal to the total amounts which were appropriated to the COrporation before January 1, 1975, pursuant to section 235 (f). In order to oa.rry out the preceding sentence, the Corporation shall, in each fiscal year, pay to the Treasury an amount equal to 25 per centum of the net income of the Corporation for the preceding fiscal year, after making suitable provisions for transfers to reserves and capital, until the aggregate ·amount of such payments equals the amounts required to be returned to the Treasury by the preceding sentence.".

UP AMENDMENT .NO . 461

(Purpose: To conform to Budget Act of 1974)

Mr. BAKER. Mr. President, I move to concur in the House amendment with a further Senate amendment, which I send to the desk.


The legislative clerk read as follows: The Senator from Tennessee (Mr. BAKER),

for Mr. DoMENICI, proposes a.n unprinted amendment numbered 461.

Mr. BAKER. I ask unanimous consent that further reading be dispensed with.


The amendment is as follows: On page 6, the bill is amended by striking

"Notwithstanding a.ny other provision of law," and the period a.t the end of the sentence in which the words to be striken appear, and inserting the following in lieu of the period: ", provided, however, that loans from the Direct Investment Fund a.re authorized for any fiscal year only to the extent or in such amounts a.s provided in advance in appropriation Acts."

The PRESIDING OFFICER. Without objection, the motion to concur with the House amendments is agreed to.

AMENDMENT TO INTERNATIONAL INVESTMENT SURVEY ACT OF 1976

Mr. BAKER. Mr. President, I send to the desk a bill on behalf of the Senator from South Dakota <Mr. PRESSLER) and ask for its immediate consideration.

The PRESIDING OFFICER. The bill will be stated by title.


A bill (S. 1687) to make a. technical amendment to the International Investment Survey Act of 1976.

The PRESIDING OFFICER. Without objection, the bill will be considered as

having been read twice and the Senate will proceed to its immediate consideration.

The Senate proceeded to consider the bill.

The PRESIDING OFFICER. The question is on the engrossment and third reading of the bill.

The bill was ordered to a third reading, read the third time and passed as follows:

s. 1687 Be it enacted by the Senate and House Of

Representatives of the United States of America in Congress assembled, That section 4(b) of the International Investment Survey Act of 1976 (22 U.S.C. 3103(b)) is amended by striking the word "calendar" each time it appears therein.

Mr. BAKER. I move to reconsider the vote by which the bill was passed.

Mr. ROBERT C. BYRD. I move that the motion to l'econsider not be tabled and that the Senate vote forthwith on the motion to reconsider.

The PRESIDING OFFICER. The question is on agreeing to the motion to reconsider.

Mr. ROBERT C. BYRD. Mr. President, I withdraw that request. I move to lay that motion on the table.

The motion to lay on the table is agreed to.

ORDER OF BUSINESS Mr. BAKER. Mr. President, I have

only one other matter. I inquire of the distinguished minority leader if there are items on the Executive Calendar today that milght be considered at this point by unanimous consent?

Mr. ROBERT C. BYRD. Mr. President, all of the items on the Executive Calendar under the nominations designation have been cleared on this side of the aisle with the exception of No. 520.

Mr. BAKER. I thank the minority leader.

EXECUTIVE SESSION Mr. BAKER. Mr. President, in view of

that clearance, I ask unanimous consent that the Senate now go into executive session for the purpose of considering the nominations just identified.

There being no objection, the Senate proceeded to the consideration of executive business.

Mr. BAKER. I ask unanimous consent that the nominations so identified be considered en bloc.

The PRESIDING OFFICER. Without objection, the nominations are considered and confirmed en bloc.

The nominations considered and confirmed en bloc are as follows:

DEPARTMENT OF STATE Ronald I. Spiers, of Vermont, to be Ambas

sador Extraordinary and Plenipotentiary of the United States of America. to the Islamic Republic of Pakistan.

John Gunther Dean, of New York, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to Thailand.

Harry G. Barnes, Jr .. of Maryland, to be Ambassador Extraordinary a.nd Plenlpoten-

tia.ry of the United States of America to India.

M. Virginia. Schafer, of Washington, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to Papua, New Guinea., and to serve concurrently a.nd without additional compensation a.s Ambassador Extraordinary and Plenipotentiary of the United States of America. to Solomon Islands.

Frank v. Ortiz, Jr., of New Mexico, to be Ambassador Extraordinary and Plenipotentiary of the United States of America. to Peru.

Thomas Aranda., Jr ., of Arizona., to be Ambassador Extraordinary and Plenipotentiary of the United States of America. to Uruguay.

John Augustus Bohn, Jr., of California, to be Ambassador.

INTERNATIONAL JOINT COMMISSION, 'UNrrED STATES AND CANADA

Donald L. Totten, of Illinois, to be a. Commissioner on the part of the United States on the International Joint Commission, United States and Canada., vice Charles R. Ross, resigned.

COMMUN.ITY SERVICES ADMINISTRATION Samuel J. Cornelius, of the District of

Columbia., to be Deputy Director of the Community Services Administration, vice William Whitaker Allison.

Mr. BAKER. I move to reconsider the vote by which the nominations were considered and confirmed.

Mr. ROBERT C. BYRD. I move to lay that motion on the table.


Mr. BAKER. Mr. President, I ask unanimous consent that the President be immediately notified of the confirmation of these nominations.


LEGISLATIVE SESSION Mr. BAKER. I ask unanimous consent

that the Senate return to the consideration of legislative business.


PROGRAM Mr. BAKER. On tomorrow, the Senate

will convene at 11 a.m. After the recognition of the two leaders under the standing order, there are orders for the recognition of seven Senators on special orders for not to exceed 15 minutes each. After the disposition of time allocated to Senators on the special orders, there will be a brief period for the transaction of routine morning business as heretofore provided for.

At the conclusion o.f morning business, Mr. President, it is the intention of the leadership on this side to ask the Senate to proceed to the consideration of the Telecommunications Act, S. 898. It is not anticipated that it will be necessary once again to ask the Senate to remain in session late tomorrow. I expect the day will be a reasonably normal day extending no later than late afternoon.

After that, Mr. President, I expect that the Senate will be asked to recess until Monday next.

September 30, 1981 CONGRESSIONAL RECORD-SENATE 22593 IN APPRECIATION

Mr. BAKER. Mr. President, I express my appreciation to all Senators and my apologies to their families for ·the imposition that I have placed on Members during this week. I have indicated so many times that I have a deep understanding of the family distress and inconvenience that is caused by late sessions other than those which must occur on Thursdays regularly or from time to time.

But I hope Members and their spouses and families will understand that the ending of the Federal fiscal year at midnight on September 30 poses a special set of circumstances and that we are under rigid deadlines that require not only the Senate but the House of Representatives as well to dispatch the business of the extension of the debt limit and the resolution making appropriations to continue the functioning of the Government and its several agencies and departments.

Were it not for those imperatives, I would not have asked the Senate to remain in session now for 3 nights in a row, far beyond the time when we ordinarily would have recessed or adjourned. I apologize for that, but I hope the Members recognize the necessity for it.

Mr. President, I express my appreciation to the distinguished chairman of the Committee on Appropriations and the ranking member and the ranking minor-

ity member for their diligence in bringing us a conference report on which the Senate has now acted, and to their staffs for their dedication and diligence as well.

Mr. President, I have no further business to transact. I inquire of the minority leader if he has any other matter he wishes to present to the Senate.

Mr. ROBERT C. BYRD. I thank the distinguished majority leader. I have no other business to transact.

RECESS UNTIL 11 A.M. TOMORROW Mr. BAKER. Mr. President, I now

move, in accordance with the order previously entered, that the Senate stand in recess untilll a.m. tomorrow.

The motion was agreed to; and at 11: 49 p.m., the Senate recessed until tomorrow, Thursday, October 1, 1981, at 11 a.m.

CONFIRMATIONS Executive nominations confirmed by

the Senate September 30, 1981: INTERNATIONAL JOINT COMMISSION, UNITED

STATES AND CANADA

Donald L. Totten, of Illinois, to be a. Commissioner on the part of the United States on the International Joint Commission, United States and Canada..

DEPARTMENT OF STATE

Ronald I. Spiers, of Vermont, a. Foreign Service officer of the class of Career Min-

ister, to be Ambassador Extraordinary and Plenipotentiary of the United States of America. to the Islamic Republic of Pakistan.

John Gunther Dean, of New York, a Foreign Service officer of the class of· Career Minister, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to Thailand.

Harry G. Barnes, Jr., of Maryland, a Foreign Service officer of the class of Career Minister, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to India.

M. Virginia. Schafer, of Washington, a Foreign Service officer of class 2, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to Papua, New Guinea, and to serve concurrently and without additional compensation as Ambassador Extraordinary and Plenipotentiary of the United States of America to Solomon Islands.

Frank V. Ortiz, Jr., of New Mexico, a Foreign Service officer of class l, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to Peru.

Thomas Aranda., Jr., of Arizona., to be Ambassador Extraordinary and Plenipotentiary of the United States of America to Uruguay.

John Augustus Bohn, Jr., of California, for the rank of Ambassador, while serving as U.S. Director of the Asian Development Bank.

COMMUNITY SERVICES ADMINISTRATION

Samuel J. Cornelius, of the District of Columbia, to be Deputy Director of the Community Services Administration.

The above nominations were approved subject to the nominee's commitments to respond to requests to appear and testify before any duly constituted committee of the Senate.

SENATE-l¥ednesday, September 30, 1981

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