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September 1973

October 1973

Kickoff Luncheon
From the President (Diane Hastert)
September Calendar
Update - Neighborhood Commission (Fay Hill)
General Meeting - Finance
Notices - Do Bills Confuse You?
Public Meeting - TCEP
League Pulse
Time for Action - D.C. Home Rule! The Time Is Now
Board Bulletin
Report from the Hill
Statement of Position on Trade
Community Education Conference on Trade (Barbara Wiebanga)


Topic: Tackling the Trouble with Trade from Tashkent to Topeka to Tokyo.

#1 On Approaching Negotiations-- the U.S. Point of View, Ambassador Eberle, Special Representative for Negotiations.

Ambassador Eberle stated that politics, security and economics must be managed carefully to produce a balanced interdependence; a total economic system is needed including trade, monetary soundness, investments. These must flow freely; it is essential to keep and increase world trade. are moving from confrontation in the world to negotiation, and more open world trade increased bilateralism, and inclusion of socialist and communist countries.

It is important to understand that Congress regulates trade and the executive branch of government negotiates trade and foreign policy. A good partnership is needed; They must work together for successful results. The trade bill must be carefully planned, and there should be a definite time limit on its passage so negotiators can have some advance authority. Note: Some sources do not think it will be passed before the 1st of next year. The negotiations begin in September.

Barbara's comments: At present, no chief negotiator for the Tokyo negotiations has been chosen by the Administration, despite there being many well qualified men. The Trade Reform Act of 1973 is still in the Ways and Means Committee where it is delayed by Watergate (how much presidential authority should be given?) and Chairman Hill's illness.

#2 On International Perspectives on Trade--Panel Discussion by Representatives of European Economic Community, Overseas Development Council, Japan and the USSR.

EEC--Adolfo Combo, Directorate for External Relations, Commission of European Community

For the EEC this is the Year of Europe--the Era of Negotiations. There has been tremendous change since World War I and multinational negotiations are badly needed. The monetary system is in need of reform and has lagged far behind other economic factors. There is a growing gap between developed and non-developed nations. The EEC is willing to negotiate to get liberal trade under fair rules of reciprocity.

The EEC's basic aim is to keep liberal trade while solving domestic issues. They are dealing from strength, but it is not sovereign. EEC and is not hurt at all by contact with other economic communities.

Less Developed Countries--Guy Erb Overseas Development Council

The LDC's approach negotiations with caution. Their trade is in primary commodities and raw materials. They are concerned that U.S. duties are twice as high as for developed countries and non-tariff trade barriers hit hard.

Japan -- S. Hayashi, First Secretary for Economics Japanese Embassy

As of 1973 the U.S. trade deficit was a big problem. From Jan. to May there was a 61% increase in U.S. exports to Japan and by May we were experiencing a surplus. The Japanese expect the deficit to be cut in half by the end of 1973, so the outlook for balance of trade is much improved, This improvement is due to expanding U.S. exports and money realignment. A balance of trade is in the interest of both the U.S. and Japan.

Japan has found the price of its accent on Gross National Product to the exclusion of domestic problems and environmental issues too high a price to pay. Therefore, it is shifting its accent in the future to social and environmental improvements. As a result more imports from the U.S. will be needed to fill the gap. Japan needs energy and raw materials. Mr. Hayashi feels we are becoming increasingly interdependent.

USSR—Yuri Malow, Assistant Commercial Counselor, Soviet Embassy

The USSR wants more open trade, but they are not very active as yet. The Cold War produced a certain mentality in the U.S.--an anti-Communist attitude which must be overcome to achieve active and open trade. They want to trade with all countries. Mr. Malov made the important point that USSR wants just trade and does not want any political ties put on it--for example, the Jewish Emigration question--just economics, not politics.

Barbara's Comments: It was made quite clear by this panel that the U.S. is no longer the only economic giant--EEC and Japan are full club members, strong and growing. Japan claims of slowing GNP growth may or may not be true; only time will tell. Mr. Hayashi answered a question of mine concerning Japan's spiraling investments in Hawaii both in land and business ownerships. he said the Japanese are confused by U,S. attitudes. First we send delegates to encourage investments, then the people complain when it looks like a Japanese economic invasion. They are confused and concerned.

#3 On Congressional Perspectives

Representative James Burke (D, Mass) believes in expansion in trade, but be feels it must work both ways. For example, we reduced barriers in 1961 and then some put up great barriers to us.

In 1962 we had a $7 billion surplus; in 1972 we have a billion dollar deficit. We have had a great flood of dollars overseas and two devaluations.

The Burke-Hartke Bill is a rough, protectionist bill, wholly supported by the AFL-CIO. He complains that the Dept. of Commerce and the States spend their time telling foreign countries how to get their goods into the U.S., but not how we can get our goods into others. He wants fair and reciprocal trade.

Representative Conable says the proposed Trade Reform Bill of the administration is a consumer bill, that the Administration's thrust is liberal. The end result, he indicated, will be a compromise between the two points of view. He thinks the committee trying to hammer out the details is walking a tightrope on the authority between the executive and Congress, and that it is influenced by the Watergate events.

#4 On Domestic Implications

James Kelly, Program Manager, Economic Developments Analysis, IBM

Mr. Kelly indicated that the dollar had been overvalued for years. We encouraged others to bring their industries to a high level of development, which in turn produced a great supply of exports in a record time. These countries then stockpiled dollars and forced us to barriers and the monetary crises.

Stanley Ruttenberg, Former Assistant Secretary of Labor

Mr. Ruttenberg would like to see tough barriers to force other nations to negotiate and eventually lower their barriers, then we can lower ours. Our open help to EEC, Japan, and Canada is no longer necessary. They are strong and have outgrown our help. Now we must get tough in our negotiations to force cooperation.

Robert Lewis, National Secretary National Farmers Union

Mr. Lewis is upset by a "rigged" market, one that prevents, economically, the U.S. from exporting food stuffs to the peoples that need them most. There is no one to work the farms and the feed costs are too great. He named three things wrong with the Administration's position--

1) we have to have means of reserves, U,S. cannot deal with famine, 2) we have to have stable prices, and 3) have to have long range goals.

#5 On the Interdependence of the Economic World

Peter Peterson, former Secretary of Commerce

He sees a strong need for close-planning with Japan because they are projecting a GYP of a trillion dollars by 1989, which will make them a super power, bigger than the U.S.

During the 1950's and 60's the foreign policy people thought economic problems were very minor, but all that is changed. need a world of sophisticated generalists with a knowledge of economics in all countries. The security, economics, and foreign policy of all nations are linked, and we must learn to share each other's burdens or we could end up in an economic war, or worse.

Energy is the biggest world problem at the moment, and we don't know what effect oil shortages will have on our balance of payments. He believes in conservation programs which will be effective and will affect demands. The Middle East will eventually realize their resources are finite, too. It is wise of us to think of helping them to evaluate the use of their money, and future growth, and therefore making it to their advantage to trade with us.

Long range national goals are needed.

#6 Hawaii's Congressmen

I visited each of our Senators and Representatives and gave them updated reports by the LWV on the Trade Reform Act of 1973 and U.S. Trade policy. Basically each of our representatives supports a liberal trade policy, but there are certain reservations. Senator Fong indicated he wanted some protection for sugar and pineapple, and is hopeful for controlled growth in Hawaii with land planning and strong restrictions on buildings as there is no law against foreign buying of our lands.

Senator Inouye is not terribly concerned with the Japanese buying into the Islands, and indicated it stimulates economic growth. He does favor pineapple tariffs, planned growth and diversification in Hawail. Congresswoman Mink also favors selective import tariffs on pineapple. Representative Matsunaga was a co-sponsor of the Burke-Hartke Bill, but says he has changed his mind and now favors a more liberal policy.

Barbara Wiebanga

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