Capitol Journal - Trade
Capitol Journal - Trade
Capitol Journal - Trade - May 22, 1985
Capitol Journal - Trade
Capitol Journal Logo
Capitol Journal - Trade
Hodding Carter. The next bill goes to the Republican controlled Senate, which is much more sympathetic to the Reagan administration concept of free trade. We talked with two Republican Senators who would be active players in that debate. Senator John Danforth of Missouri, Chairman of Senate Chair Finance sub-committee on International Trade who supports some protection for American industry and Daniel Evans of Washington, a member of the Foreign Relations Committee who strongly opposes most trade restrictions.
Capitol Journal - Trade
Hodding Carter. Senator, do you expect the Trade bill to come out in Senate? Senator Daniel Evans (R - Washington). Well it s possible but I think the odds are less than 50/50. We ve got a full plate between now and the limited amount of time remaining in the session. Hodding Carter. But is the Senate itself disposed to pass some kind of Trade legislation to give relief to American industry? Senator Daniel Evans (R - Washington).Well I think there s a large sentiment and it comes from the various parts of the country each of which has a separate problem but when you add them all together there s a lot of interest in Trade legislation. Difficultly, I think would be to call less people on a particular piece of legislation. Hodding Carter. Did you find the House version to be useful or detrimental? Senator Daniel Evans (R - Washington). Oh I think there are some elements of it that are probably useful. But on the overall, it is a protection as to oriented measure. Its ultimate aim will be to reduce the total international pie, if you call trade that. I d rather expand it and I think that s bad for the market industry just as it s bad for foreign industry.
Capitol Journal - Trade
Hodding Carter. But hasn t the United States been so affected that American Industry needs some kind of relief? Senator Daniel Evans (R - Washington). I m not so sure. The cry for Trade legislation has paralleled almost exactly the rise in the value of the American dollar over the last several years. Now that the American dollar has against some of our other trade partners has headed the other way, I think it will be relatively a few months before we see some relief coming naturally. We re already seeing price increases on Japanese goods coming into this country. I think we ll see further price increases. That has to have a tendency to ease the competition. Unfortunately, Congress as usual is likely to come up with legislation after it s no longer needed.
Capitol Journal - Trade
Hodding Carter. The administration is admittedly opposed to the House version as it submerged. Some people say that version is really just to get the administrations attention. Has the White House acted effectively in this area? Senator Daniel Evans (R - Washington). Oh I suppose that any of us could say we could do a better job. I think the administration has tried to maintain as free a trade posture as possible. Which I think is an appropriate basic policy and I enthusiastically support the President his drive. They have moved on several issues and several items particularly recently. I think that they moved appropriately. Hodding Carter. Senator if you were going to give a prescription for improving our international trade position, what would it be? Senator Daniel Evans (R - Washington). Well I think the currency of our evaluations is going on right now is overwhelmingly the biggest element of all. If six months ago you had told those who were trading with Japan or competing against Japanese imports that you would give them a 30% tariff, they would jump for joy in the streets. But that s exactly what s happened with the change in value of the yen compared to the dollar. But apparently that isn t enough. They still want more. I think the best thing we can do is learn how to be more competitive. Learn what it is we can do best in an international marketplace. And recognize that if we are going to sell to others, they ve got to earn some dollars from us in order to buy. Hodding Carter. Do our major competitors/partners play by the rules as we understand them? Senator Daniel Evans (R - Washington). Probably not precisely. They have a different set of rules but so do we. For us to say that the playing field is always tilted against us, just flies in the face of the logic that says to some American industries--- here are very big tax bonuses or tax benefits. To a foreign competitor, that looks like a tilted playing field the other way around. So both sides have protections. I guess the drive is to try to make them as even as possible.
Capitol Journal - Trade
Hodding Carter. Are there problems in the trade area that the Congress should properly address? Senator John Danforth (R- Missouri) Sure. Anytime you have $150 Billion dollar trade deficit or anything close to it. There are problems that Congress should address. Not only should address, but under the Constitution in a way have to address it. But this is our constitutional responsibility relating to international commerce and we ve got to get with it. Hodding Carter. But is approaching the House bill the way to do it? Senator John Danforth (R- Missouri). No. The House has really gone overboard. The House is has focused on a problem. They have recognized that until very recently the administration has been too passive in addressing the problem. They have decided to legislate but their remedy is very protectionist and really I think defeatist. So there is a real role for the Senate to play now I think in Trade legislation in finding a niche for ourselves which is neither passive nor protectionist. Hodding Carter. Will the Senate find a role and how can it be a little protectionist? Senator John Danforth (R- Missouri). I don t think you can be a little protectionist. I think that you can provide some short term relief for industry s that otherwise would go down the drain. But under our trade activist short term relief and I would distinguish from that, from just giving up the game which is what real protectionism is. Hodding Carter. And will the Senate do it? In this session? Senator John Danforth (R- Missouri). I think so, yes. I think after the finance committee finishes with the tax bill. We will be looking for other things to do. Hodding Carter. That s September though right? Senator John Danforth (R- Missouri). Well I think what we ll do is probably have some hearings in June and hopefully mark up a bill in July. Be ready to report it out and report it out. Then August/ September be in the position of getting it to the floor. We would hope to then go to conference with the House. We re running out of time in this Congress. But Senator Dole has said repeatedly that he would like to do something in trade. I think Bob Hack recognizes that it s a matter of moment certainly. And now that the House has passed a bill, I don t think the Senate can very well say we re not going to do anything. We have a real opportunity here and it s an opportunity to pass some responsible legislation.
Capitol Journal - Trade
Hodding Carter. Isn t time on the side of those who say time will fix it? And aren t things really getting better? Senator John Danforth (R- Missouri). I hope things are going to get better. They re not better yet. I mean the trade figures that have come out in recent months have been even worse than the comparable month last year. We ve had all time high trade deficits. I think that things are going to get a little better in response to the declining value of the dollar. But I think even with a dollar that is much lower than it has been with respect to other currency s which are quite valuable in the end. We are still going to have real problems. The Japanese in particular are very difficult to deal with in trade. They do not have an open market. It doesn t matter what the value of your currency is. You can t penetrate that market and that s something we re going to have to handle.
Capitol Journal - Trade
Hodding Carter. Isn t there something the administration should, can, will do on its own? Senator John Danforth (R- Missouri). The administration can do a lot of this on its own. It has become much more active both with respect to exchange rates and dealing with unfair trade practices in the past half year. But I think if Congress doesn t push the administration they will revert to their old passivity. So Congress really has to continue to push the administration. Hodding Carter. And the best way to do that is through? Senator John Danforth (R- Missouri). Well I think legislation would be very useful. I think there are some good ideas for legislation but I think beyond the legislation itself it does keep the heat on the administration.