CONGRESSIONAL RECORD - SENATE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00957A000100100025-2
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 9
• Document Creation Date: December 16, 2016
• Document Release Date: July 21, 2005
• Sequence Number: 25
• Publication Date: August 6, 1976
• Content Type: OPEN

st 6,S 13807
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administer oaths or affirmations, and may
by subpoena require any individual or en-
tity to appear and testify or to appear and
produce books, records, and other writings,
or both, and in the case of contumacy by, or
refusal to obey a subpoena issued to, any
such individual or entity, the district court
of the United States for any district in
which such individual or entity is found or
resides or transacts business, upon applica-
tion by the Attorney General, and after no-
tice to any such individual or entity and
hearing, shall have jurisdiction to issue an
order requiring such individual or entity to
appear and give testimony, or to appear and
produce books, records, and other writings,
or both, and any failure to obey such order
of the court may be punished by such court
as a contempt thereof.
CIVIL REMEDIES
In-Which such gateway city is located, if an
einployer in the PIade to Vrhich such immi-
grant is US travel under the grant certifies
that such employer till employ that immi-
grant. In addition, the Secretary is author-
heed te make grants of up to $250 to each
Member of an" irmiligrant's- immediate family
to enable such member fo accompany the
immigrant in -travel assisted under this sub-
section.
(b) The United States Nniployment Serv-
ice is directed to establish and maintain
programs in gateway cities of job referrals
for immigrants to jobs available in States
other than that in which such gateway city
is located.
AtIVROFMKTIO11.b OVIZTATIO24?
SEc, 9. (a) There are ati horized to be ap-
propriated such sums as are necessary for the
purposes of grants under sections 5, 6, and 7.
If sufficient funds are net appropriated for
any fiscal year for the erlizrpose,s of grants
under sections 5, 6, and Tno funds shall be
allocated under sectien 7 until all funds
available shall have been allocated under
section 6, and no funds Shall be allocated
tinder section until all funds available have
been allocated under section 5.
(b) There is authorized to be appropriated
the sum of $20,000,000, to remain available
until expended, for grants and programs
under sections 8(a) and 8(b).
By Mr. MAGNUSON (for himself
rid Mr. PEartsON) (by request) :
A bill to require the disclosure
o payments to foreign officials and for
Other purposes. Referred to the Commit-
- tee on Commerce.
Mr. MAGNtTSON. Mr. President, I in-
troduce for myself and' Mr. PEARSON, by
request, a bill to require the disclosure of
payments to foreign Ukiah and for
Other purposes.
Mr. President, the Secretary of Corn-
rce has submitted a letter and draft
o proposes egislation en es or-
eign Payments -Disclosure Act:- L oijc
Imanimous consent that- the text of t e
VII an analis of thebin, and the state-
remarks.
There being no objection, the bill and
Ihaterial were ordered to be printed in
the RECORD, as follows:
S. 3741
Be it enacted by-th-e-re.nate and House of
Representatives of the United States of
America in Congress assembled, That this
Act may be cited as the "Foreign Payments
Disclosure Act".
nErxhrriovs
SEC. 2. For purposes of this Act:
(a) "person" means:
(1) an individual who is a citizen of the
United States;
(2) an individual who has been lawfully
admitted for permanent residence as de-
scribed in section 101(a) (20) of the Immi-
gration and Nationality Act, as amended (8
1101(a) (20)); or
((3) a legal entity, other than a noncom-
mercial government entity, organized under
the laws of the United Slates or a State or
political subdivision thereof;
(b) "anything of value means any direct
or indieeet gain or advantage, or anything
e
that might real- itably be regarded by 'the
beneficiary ae. a direct or indirect gain or
advantage, including a direct or indirect gain
or advantage to any other individual or
entity;
(c) "foreign seiniate" means a legal entity
organized under I he laws of a foreign coun-
try, or political udedivislon thereof, at least
50 percent of which is beneflaially owned
directly or indirectly by a person or persons
subject to the previsions of this Act;
(d) "Secretary'', unless otherwise specified,
means the Secretary of Commerce;
(e) "foreign p,ffilic official" means:
(1) an officer (-.r employee, whether elected
or appointed, of a foreign government; or
(2) an individual acting for or on behalf
of a foreign government;
and includes an individual who has been
nominated or appointed to be a foreign pub-
lic official or who has been officielly informed
that he will be so nominated or appointed;
(f) "official action" means a decision, opin-
ion, recornmeneetion, judgment, vote, or
other conduct iiivolving an exercise of dis-
cretion by a foreign public official in the
course of his ern.-..loyment;
-(g) "State" nleans a State of the 'United
States, the Distre t of Columbia, Puerto Rico,
or any territory or possession of the United
States; and
(h) "foreign r,vernmont" means:
. (1) the goverinnent of a foreign country,
irrespective of eecognition by the United
States;
(2) a deparineeet, aeency, oz branch of a
foreign government;
(3) a corporei ion or other legal entity
established or owned by, and sebject to con-
trol by, a foreign government;
(4) a political i-ubdivision of a foreign gov-
ernment, or a di partment, agency, or branch
of the political subdivision; or
(5) a public reternational organization.
REPORT E NG REQUIREMENTS
SEC. 3. A perse-i shall report to the Secre-
tary, in accordaleie with regulaeions promul-
gated by the Sr retary, payments hereafter
made on behali of the person or the per-
son's foreign afti.ate to any other individual
or entity in connection with: An official ac-
tion, or -sale to or contract with a foreign
government, for the commerc:.al benefit of
the person or h ee foreign affiliate,
- ercorire,TG REQUIREMENTS
SEC. 4. In order to insure that a person who
is required to report under section 3 of this
Act has sufficient information in his pos-
session to repor-i. accurately, :he Secretary
may promulgate rules and regulations re-
quiring Such peeeon to keep streh records, in
the form and is tuner prescribed by the 'Sec-
retary, as he deems necessary to carry out
the purpose of lids Att. In devising the rec-
ordkeeping rec.oirements, the Secretary
shall consult ad tee other Federal agencies tn
eliminate unnecessary duplication in rec-
ords acquired by the agencies. The agencies
are authorized, where appropriate, to com-
bine in a single form the recerds required
under this Act; and under any other Act.
EN} ORCELI_. ST; COMPLIANCE WITH
ii QUIRE NEE NTS
SEC. 5. To the extent necessary or appro-
priate to the enforcement of this Act, the
Secretary, aDd officers and employees of the
Department of ,Commerce specifically desig-
nated by the , eecretary, may make such
ileVestigettons s od obtain suet information
from, make sure. inspections ef the books,
records, and oil or writings of, and take the
sworn testimone of, any indivie.ual or entity.
In addition, sri 1 officers or employees may
SEC. 6. (a) CIVIL PENALTIES .?A person who
fails to file a report required under section
3 of this Act, or who falls to maintain the
records required under section 4, or, who files
a report under section 3 but negligently
omits information required to be reported
under section 3 or negligently states false
information required to be reported under
section 3, shall be subject to a civil penalty
of not more than $100,000.
(b) IntuNCTioN.?Upon evidence satisfac-
tory to the Attorney General that a person
is engaged in an act or practice that consti-
tutes a violation of this Act, the Attorney
General may bring an action in a district
court of the United States to enjoin witch
an act or practice, and, upon a proper show-
ing, a permanent or temporary injunction
or restraining order shall be granted by the
court together with such other equitable
relief as may be appropriate.
SEC. 7-. (a) FAILURE TO FILE.?A person who
knowingly; (1) fails to file a report required
under section 3 of this Act;
(2) fails to maintain records required
under section 4 of this Act; or
(3) omits required information from, or
falsifies information in, records kept under
section 4 of this /Lot;
shall be fined not more than $10,000 or im-
prisoned for not more than one year, or both,
except that a legal entity shall be fined not
more than $100,000.
(b) KNOWING FA LSIFICATION .?A petioli
who files a report required by this Act' which
he knows or should know contains a false
statement, or which he knows or should
know omits required information, shall he
fined not more than $100,000 and imprisoned
not more than three years, except that a legal
entity shall be fined not More than $500,000.
DISSEMINATION OF REPORTS
SEC. 8. (a) DISSEMINATION WITH THE
UNITED STATES.?The secretary shall,aupon
receipt of a report, disseminate copies of the
report to the Department of Justice, the De-
partment of State, and the Internal Revenue
Service. If the person who filed the report is
subject to the jurisdiction of the Securities
and Exchange Commission, the Secretary
_ shall also transmit a copy of the report to
-the _Securities and Exchange Commission.
e Until the report is released to the public, it
shall be maintained in accordance with sec-
tion 1905 of title 18, United States Code. The
report shall be transmitted, upon request,
subject to an appropriate arrangement to
assure its confidentiality, to Committees of
the Congress having legislative jurisdiction
over the subject matter of the report. A re-
port shall be made public one year after re-
ceipt in accordance_ with rules and regula-
tions promulgated by the Secretary, unless
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BEST COPY
Available
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S 13808
Approved Forft
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August 6, 1/'1j
nos reporting requirement will be turtner
delineated by the issuance of regulations
pursuant to election 9(5) of the bill, which
requires the ;monetary, by regulation, to isee a
threenold amount below which payments
need not be reported, and to define typeE of
payments which need not be reported. Thos,
while the reperting requirements of the hill
will extend to proper as well fie improper
or illegal payments, the regulations issued by
the necretary will exclude from reporting cer-
tain regular business payments not incon-
sistent with die purposes of the bill tied
bona fide payments such as taxes.
The terms -individual or entity," as mied
in Section 3, refer to foreign public officials,
foreign governments, and agents or inter-
meellaries used in connection with covered
trannactIone or official actions.
Recordkeek:ng requirements
Section 4 allows the Secretary of Comment cc
to promulgate rules and regulations prescrib-
ing record keeping necessary to carry out
the purposes of the Act. The Secretary 1i3 to
consult in the design of these record keeping
requirements with other federal agencies
as to elinithate unnecessary duplication of
recatd keeping. It is anticipated that -.he
SEC's record keeping requirements for Anne
regulated by, the SEC may suffice for pur-
ple:0e of compliance with this bill.
Enforcement
Section 5 grants the Secretary of Cola-
meree authority to inspect books and records,
lasue subpoenas and take sworn testimony as
eieconnery and appeopriate to the enforee-
merie of the Act.
Civil remedies
Se:tion 6 provides a civil penalty of not
more than $100,00( for failure to thea re-
port required by Section 3, failure to main-
tain records required by Section 4, or for
negngent orrreedon or inclusion of false in-
fore:onion In a report required under Sse-
lion 3.-Seetion 6 also gives the Secretary the
power to request the Attorney General of the
United States to bring an action In federal
district court to erjoin a person from eon-
theieng to engage hi any act or practiee that
COlictitUtffi It violation of the bill.
Criminal penalties
Section 7(a) provides criminal penalties
for knowing violations of the requirements
of Sections 3 and ti of the Act. Individuals
may be fined not more than 810,000 or im-
prisoned for not more than one year, and a
fine of 8100,000 Is provided for legal entities
such as oerporstiors. Section 7(b) penalizes
an a felony, knowing falsification of reports
required by Section 3. Individual offenders
may be fined not more than 8100,000 ead
Imprisoned not more than three years. A
legal entity le subject to a criminal nee of
tip te e500,00n.
Desennineition of report::
Section 8m) requires the Secretary, upon
receipt of a report, to disseminate it to the
Departments of State and Justice, the En-
ternel Reeetene Service and, where appropen
ate, to the Securities and Exchange Conn
menion.
Section 8, is I states that the Departinen1
Justice or the State Department can, as ap-
propriate, re:ay information contained In
such reports to authorities in foreign juris-
dictions. Except for the aforementioned Mee-
pemination. the Secretary of Commerce must
keep reports confidential in accordance with
Ja r s.c. I If105, for one year from date of
receipt. This one-year period will help pro-
tect business competitive information vod
the Secretary of State makes a speenie deter-
mination in writing that foreign policy inter-
ests dictate against dieclosure, or melees the
Attorney General makes a specific deter-
mination in writing that the statue of an
ongoing investigation or prosecution dictates
against public disclosure through Meer than
conventional judicial procesen.
(b) DISSEMINATION TO A POp.EMN GOVERN-
MRINT.?The Attorney General, with Elie con-
currence of the Secretary of State. may fur-
nish any information contained in a report
made under this Act to the appropriate law
enforcement authorities of the foreign gov-
ernment Concerned In accordience with ap-
plicable procedures and Mtn-nation:el time-
meats. The Secretary of State, with the con-
ounence of the Attorney Cletieral, I my pro-
vide any such information to the foreign
government concerned.
REGULATION S
Sec. 9(a). PROIMILSATIOn Or RECULA-
TIONS.?The Secretary shall promulgate such
regulations as are necessary to carry out the
purposes of this Act. The regulaticen shall
include:
(1) a requirement that the .npori include
the name of every recipient who receives any-
thing of value over a specified amount and
the amount received by each such recipient;
(2) a requirement that the report include
information concerning nnetiple pannente
with respect to a single trainactio i which
total over a specified amount, and
(3) a definliton of certain types id pay-
ments which are not required to be reported
because they are regular buneuese payments
not inconsistent with the purposn of this
Act, or are bona fide payments to a foreign
government, such as taxes or fees paid pur-
suant to duly promulgated lens, reg nations.
decrees, or other legal action.
(b) CONSULTATION WTE11 0In 4R Aca IFM-- -
In devising the reporting regulate no, the
Secretary shall coneult with other federal
agencies to eliminate unnecessary duplica-
tion in reports required by the ageneine. The
agencies are authorised, where appropriate.
to combine in a single Term the report, re-
quired under this Act and ender aly other
act.
COMPORMINO AMENIMENT
SSC. 10. The provisions of this A ether
than section 0(b), shall not apply to pay-
ments meede in connection with le) sales
of defense articles or defense sex-vices under
section 22 of the Arms Export C-ontr al Act or
(b) commercial sales of defense 111 tlEIes or
defense services licensed or Approved tinder
section 38 of the ATMs Export Control Act.
PROVISIONS OF LAW NOT Arm- ref.
Sec. II. (a) Ricans Arm Dtrrrr s Ulmer
Orsza.Liws ineAriscrste?Notbing In this
Act shall be construed as affretelng tie rights
or duties arising under the Securitieb Act of
1983, 15 Cf.S.C. 77a et seq., the Seoul iti.)a Ex-
change Act of 1934, 15 U.S.C. 78a et seq,
the Public Utilities Holding Company nit of
1935, 15 D.S.C. 79a et sem, Cie Truet. Inden-
ture Act of 1939, 15 U.S.C. elann tee In-
vestment coMpany Act of 1940, 15 II SC. ens-
1 at seq., and the Investment Advise re Act of
1940, 15 U.S.C. 80b-1 et seq., and al y itunee-
quent amendments thereto. Person ; sehject
to this Act shall be required to mdcc uch
public disclosure of the seaters dee:nixed In
section 3 of this Act as naly be otherwise
required under the statute it Move,
Nothing in this Act shall preclude peening
reporting pursuant to the provisions of this
Act from making public dirclootre ef any
payment described in section 1.
ib) Avritoerry Or EIECERITIRS AND Eiclialatie
Comselsoion.--Nothing in this Act snail be
cenatruedas sleeting ur conditioning the
authority of the Securities and Exchange
Cocarnitelon to enforce the statutes listed in
oineection (a) or to investigate violations
tnereof, The Commissiori shall have the an-
reeor1ty to premise such enforcement or in-
vestigation on thionnatkei received pursuant
eectiun Ina) of this Att.
aneers AND RESIXOULS PaViLeVED
Sac. 12. The right's and remedies provide-1
Os tills title shall be in addition to, and emit
not be in derogation of, any and all other
nghte and remedies that may exist at law or
ill equity.
Famernerneeteucton PAY Wi nes Lerecnosenz Ace
incenvon-ne-secrion efeeelrere TIM DILL
Short tole
Section I of the bill provide that It may
Or' cited as the Poreign Payments Dieclosure
Definitions
nectin. 2 denims certain terms used lii
e;te bill. "nereon" 1 detnied no mean incite
vicluale who are the citizens or resident
aliens of the United States or legal entities
oreeo Intel under I lie laws of the United States
or airy slate or political subdiviarion thereof.
A e exteptien 13 made for government entities
a leen lire riot organized for eornmercial pm--
pines. Federal, state or local government
having commerail or trade promo-
teem purposes would be subject to the Act.
Anything of volute' is defined broadly to
I: nude rIty direct or Indirect gain or advert-
rpm to ii direct beneficiary or to any third
piney teneficlary.
-Foreign affiliate" is defined to mean any
ieeel orgenleed ender the laws of a
f ,reign country, whenever It is at least 60
renceet eeneficially owned by persona 'rub-
e-et to the Act. More complex definitions
et ownership or control were rejected for
the purposes of clarity and simplicity of
ednitnietration.
"Foreign public official' is defined to mean
In ?freer or employee of a forelim govern-
ment, whether elected or appointed, or an
individual acting for or on hamlet of a for-
eign government. The term further is de-
fined to include sit individual who has been
eonunated or appointed to be a foreign pub-
lic official but who hes not yet formally
eritereu othee.
"Officiel action" ia defined to mean any
decision, opinion, recommendation. judg-
ment, vote, or other conduct involving an
eeercne of discretion by a foreign public
ulimelaS u. um course of lin employment.
'Foreign government" or defined broadly to.
e.clude soy government ul it foreign country,
is ilepoi teneut or agency thereof, a corpora-
noel or other legal entity under control of a
torten, government; any polities; eubdigesion
el a foreign govertuneon ared any public
L. oational oreanientiori.
neporttng regziftremcntr
S,:ct ion :1 or the hill sets forth class's of
vv;niurtz which must be reported to the
eenntary of Commerce In accordance with
rentelatione promulgated by the Secretary.
There trvelocie payments made, after passage
cf the bel, on behalf of ri person subject to
the Act or the person's foreign affiliate to
nie other individual or entity in connection
%nth: in official action, or sale to or contract
with is foreign government for the COTainer-
t1S1 i+sneni of the pennon or his foreign
veinal f?
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lessen possible foreign relations problems.
Reports ere to be shared, however, upon re-
quest and subject to appropriate assurances
of Confidentiality, with Committees of Con-
grails having appropriate legislative jurisdic-
tion.. After the .expiration of the one-year
period, reports are to be available for public
insPection and -copying, unless- a specific
determination is made in Writing by the
Secretary of State that foreign policy inter-
ests dictate against public disclosure, or the
Attorney General makes it specific deter-
mination in writing- that the status of an
ongoing investigation of pfosetution dictates
against public disclosure through other than
conventional judicial process.
'4egulations'
-
Section 9(a) grants the Secretary of Corn-
' merce broad rePtilatory authority.
Regulatiens are tb include a requirement
? that names of recipients of Payments be re-
ported. Further, they are to contain a Mini-
time of types of payments not required to
? reporte d because they are regular business
payments not inconsistent with the purposes
of the Act, or are bona fide payments to a
foreign government, such as taxes or fees
paid pursuant to law, regulation, decree or
other action.
In addition, in accordance with Section 9
(a) (1), the Secretary is to set a threshold
amemit below which payments need not be
reported. An exception is -made to this
threshold concept for multiple payments
totaling the threshold amount with respect
to a single transaction. The purpose of this
threshold will be to exclude so-called "grease"
or "facilitating" payments, i.e., small pay-
ments made to expedite low level official ac-
tions such as, customs processing. Reporting
of such minor payments could create bur-
dens far outweighing the benefits sought by
the Ant.
Section 9(b) directs the Secretary, in de-
vising reporting regulations, to consult with
other federal agencies to eliminate unneces-
sary duplication. Agencies are authorized,
where appropriate, to combine in a single
form, reports renpired under this bill and
Any other law. -
' CcmforMing Antendment -
Section 10 states that the previsions of the
Act, other tlian'SectiOn 0-(b), shall not ap-
ply, to Certain seise of defense articles and
service's Pursnant. to The Arms Export Con-
trol Act. This, exemption is based upon the
fact that the Arms Export Gotitrol Act 'Pro-
vides_ for 'comprehensive reporting to the
State Department and the Congress of in-
formation regarding payments with respect
to such transactions (Section 604 of P.L.
94-229).
Provisions of Law Not Aftected
Section 11 makes -clear that the require-
/netts of the bill in no way alter or affect
- rights and duties arising under laws ad-
ministered by the Securities and Exchange
Commission. Similarly, it states that nothing
in the bill is to be construed as affecting or
conditioning the authority of the Securities
and Exchange Commission. rt provides fur-
ther that the Commission shall have the au-
thority to premise enforcement or investiga-
tive actions on information received under
Section 8(a) of the bill from the Secretary
of Commerce.
Rights arid Remedies Preserved
- ?
Sealer; 1240.*tlas.tAbe_lilli does ;lot take
away :any /''lg? te, and remedies which may
,
exist at law or inequity. Thus, nothing in the
bill should be colvtrued to affect rights and
remedies of individuals who may bring share-
holder derivative suits under state law.
PROPOSED OREIGN P.1,:eatENT5 roISCLOSTJRE ACT:
STATEMENT OY PURPOSE AND NEED
The proposed Foreign Payents Disclosure
Act was prepared by the Cabinet-level Task
Force on Questionelele Corporate Payments
Abroad, created by President Ford on March
31, 1976 to conduct a sweeping policy review
of the questionable payments prob:_em.
Based upon an interim report a! the Task
Force, President IFerd on June 14 directed
that legislation be prepared requiring report-
ing and disclosure of certain payments made
in relation to busisess with foreign govern-
ments.
The proposed legislation is designed to help
deter improper payments in international
comMerce by American corporations and
their officers; to help restore the good rep-
utation of American business; to help deter
would-be foreign et, tiorters from seeking im-
proper rewards trot a American businessmen;
and to set a forcefel example to our trading
partners and competitors regarding the im-
perative need to eni improper bus:ness prac-
tices.
Most important, as stated by President
Ford in his message to the Congress regard-
ing this legislation it: "will help ::estore the
confidence of the American people and our
trading partners is; the ethical stsndards of
the American business community. In so do-
ing, it can yield suestantial long-term bene-
fits to American business, to American for-
eign policy, and to international commerce."
In deciding upon a legislative approach,
the President and the Task Force: (1) re-
viewed the Ongoing efforts of the Federal
Government with regard to the questionable
payments problem (ii) analyzed, the ade-
quacy of current :DIVS in dealing with the
problem; and (ii evaluated alternative
means to strengthen deterrence of improper
.payments and to increase conedence in
American, husinese.
ONGOING APPROACII TO TIIE QUESTIONABLE
PAYMENTS PROBLEM
The current Administration approach to
the questionable payments problem includes
both (a) vigorous enforcement if current
law and (b) pursuit of effective International
payments.
(a) Enforcet.tcnt of current law
Investigative enforcement activities are be-
ing conducted by the audit agencies, the In-
ternal Revenue Service (IRS), the Federal
Trade Commission t FTC) the Department of
Justice, and the iiiecuriiies and Exchange
Commission (SEC).
The investigative activities of all these
agencies are ongoing?and the product of
their investigation., will continue to emerge
in accord with fair and orderly legal process.
It is reasonable to conclude that the ex-
posures to date have increased the attentive-
ness, of responsible enforcement agencies in
general?and that they have increased the
deterrent effect ol current law thereby. A
particule,rly notewerthy example ..s provided
by the IRS's guidelines of May le, 1976?re-
quiring affidavits concerning "slush funds,"
bribes, kickbacks cc other payments regard-
less of form, math:: directly or indirectly to
obtain favorable treatment in securing busi-
nest or special concessions; or made for the
use or benefit of, ,sr for the purpose of op-
posing any government, political party, can-
didate or committit.
A4 is well kner4o, the SEC has played a
leadership role in . lens area, Its prompt and
Vigorous actions to discover questionable or
illegal corporate payments and to require
public disclosure of material facts relating
to them, is contributing an important meas-
ure of deterrence to such practices.
S 13809
' (5) Pursuit of International Agreements
The recent Organization for Economic Co-
operation and Development (OECD) Minis-
terial Conference adopted the following de-
claratory policy:
"Enterprises should:
Or not render?and they should not be
solicited or expected to render?any bribe
or other improper benefit, direct or indirect,
to any public servant or holder of public
office;
(11) unless legally permissible, not make
contributions to candidates for public office
or to political organizations;
(in) abstain from any improper involve-
ment in local political activities.".
Ambassador Dent has asked the General
Agreement on Tariffs and Trade to take up
the questionable payments issue, as called
for in Senate Resolution 265. The resolution
proposes negotiation in the Multilateral
Trade Negotiations of an international agree-
ment to curb "bribery, Indirect payments,
kickbacks, unethical political contributions
and other such similar disreputable activi-
ties." The U.S. has indicated that negotiation
of such an agreement is a matter of top
priority.
Most significantly, the U.S. has proposed
negotiation in the United Nations of a treaty
on corrupt practices. The proposal is for an
agreement to be based on: the following prin-
ciples;
(i) It would apply to international trade
and investment transactions with govern-
ments, i.e., government procurement and
other governmental , actions affecting inter-
national trade and investment as may be
agreed;
(11) It would apply equally to those who
offer to make improper payments and to
those who request or accept them;
(111) Importing governments would agree
to establish clear guidelines concerning the
use of agents in connection with govern-
ment procurement and other covered trans-
actions, and establish appropriate criminal
penalties for defined corrupt practices by
enterprises and officials in their territory;
(iv) All governments would cooperate and
exchange information to help eradicate cor-
rupt practices;
(v) Uniform provisions would be agreed
upon for disclosure by enterprises, agents
and officials of political contributions, gifts
and payments made in connection with
covered transactions.
The proposal is currently under review in
the TIN Economic and Social Council
(ECOSOC) with a strong U.S. recommenda-
tion that ECOSOC give the Issue priority
consideration.
The U.S. objective is to have ECOSOC pass
a resolution on corrupt practices which will
create a group of eXperts charged with,writ-
ing the text of a proposed international
treaty on corrupt practices and reporting
that text back to ECOSOC in the summer of
1977. The U.S. goal would then be to forward
an agreed text to the UN General Assembly
for action in the fall of 1977.
It is the view of the President and the
Task Force that the ultimate legal basis for
adequately addressing the questionable pay-
ments problem must be an international
treaty along the lines proposed by the United
States. A treaty is required to make the
"criminalization" of foreign bribery fully en-
forceable?for, in the absence of foreign co-
operation, it would be extremely difficult, and
In many cases impossible, for U.S. law en-
forcement officials and potential defendants
to be assured of access to relevant evidence.
A treaty is also required to treat the ac-
tions of foreign as well as domestic parties to
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questionable transaction. And xi treaty is
requited to minute that all 114iI0DR, Mil the
cospeting Mane of cfifferine mitiene, are
trefttcl on the same beda
DI Order to fidtanoe the pro 3pects t f favor-
able international action with respect to the
1311. proposal, the State Department hes co-
ordinated a special series of direct represen-
tation:: to foreign govefnmeres We will mis-
time to pursue a satisfactory inter lath-mei
Agreement by every approprbite means
While continuing to pursue the long--term
approf ch toward an interrnitietial agi eement,
It is nonetheless necessary so supplement
current U.S. law--as indicated by tie follow-
ing discussion.
errITICIENCY Or CURREvr
The Task Force undertetel a oei is and
analysis Of the sufficiency of current lass to
deal eith the problem Of dettrring q set lion-
able payments by American belies-seinen and
to restore public conlideme in muteness
standerds It concluded that cern et
while providing a number of indirect nteene
to deal with the problem Ails not fully
sualcient.
It le clear that existing sec eitite live; and
the leternal Revenue Code tin hese impor-
tant bearing upon the queoltmatie pay-
manta problem?the former by requeing dis-
eh:metro Of "material" Improper payment".
and the latter by denying tex deduction of
U11 payments. In addition, ye:erode rap-
pffehtion of securities and tee standards Is
prompting increased internal cirporate
accountability.
Farther, the Task Force Identified e settee
of antitrust provisions which Might be ap-
plied to questionable or illegal piyinents
abroad. However, effective application of
these laws to transactions Ii voicing e reign
payments Is problematical. Fnaliy, the Task
Pore Identified a number of certificetlen re-
quirements Imposed on cctnpanies doing
been' as abroad with federal as-sister ea, such
as that provided by the Export-Impel Dank
and tee Agency for International Develop-
went Deliberate falsification of such certifi-
cations can give rise to criminal ilanility.
Nevertheless. these certification rein' reenenta
can Only apply to firms wh:ch ava I them.
selves of -these federal assistance programs.
The Tata Force is persuaded that the SECS;
system of reporting and Mace -sure otters hits-
stantial deterrence to future improper-prac-
tices by SEC-regulated fines. To further
strengthen the SECei capacity to pm forru its
vital functions, the Adm.nistret on en-
doreed--and.will continue to eappote tie, en-
actment of--le-gielation firm propeatd by
Chairman H.Uis of the SEC. By maalt,g ex-
plicit What Is already implicit in the SEC's
authoritles, this legislation can enhince the
effectiveness of the SEC disclosure system as
It pertains to SEC-regulatal companies by
assuring integrity of ecrrponve reporting sys-
tems and the accountabilhy of ((operate
ofiledale,
However, by no means all firms ozgand In
International commerce are regulated under
the securities laws and subject to the dis-
closuee requirements of the Conon salon.
Also, the Commission requires disc os Ire of
payments only When neceesery or uppropri-
ate for the protection of in-restore. Fertner,
It has not generally required reportieg of the
name of a recipient of a nusteriel, mproper
payment, a requirement which the Task
Force believes can be an Important tieteerent
to extorters. In addition, the Coincelesiones
system Of disclosure?focusing as It does pri-
marily on the interests of the investing' pub-
lie?is not designed to respond to some of the
broader public policy and urchin reletione
ir tereste related to the toes, tenable pay-
problem.
eccordingly, the Former, Fermenta DIE-
A_.flire Act deals with el US participants
in foreign commerce--net juie: Copsmlssion
rtgelat-ed arms?and it coils for the active
iLeolvement of the Secretaries of State and
Cisionierce and the Attorney General in ad-
iceeete deg a sire em which addreesan the full
;thee cf public policy interests Inherently
It solved 'n the questionable payments prob-
Orr:.
1.155
'cat ma NALryarlois - Ari io
She Task Force consiecred two principal
competing legislative approaches?a "dis-
closure" approach and is ecritainalization"
approach. While it Is poesible so design leg-
islation which requires diacireeire of foreign
pity meets and makes eeriest payments erine-
taai tinder U.S. law, the Task Force uneist-
iterusly rejected this approach. The disclo-
oire-plus-criminalizatlon scJacine would, by
a- very ambition, be Inteective. The eeist-
slice of U.S. criminal penalties for certain
iteeetuniebiti payments- would deter their die-
elosure and thus the positive value of the
tbeeloeure proviaious would be reduced In
the Ta.sit. Furceh opinion, the leo approachte
oinuot be compatibly ?Mined.
lime 'leak Force carefully esesidered Slit
optima or "criminalizing", under U.S. law
improper paymeote made to lorenos olfleisi
be U.S. corporation's. duce legislation would
leave represented the.moie, forceful possible
rhetorical condemnation of amen conduct
It would have placed bueinese executives or
elate and unequivocal notice that such prac-
occe 'should stop. It would have made le
ieteter Inc some corporations to resist pree-
surer. TA make questionable pisymentie
l'he 'reek Force concluded, however, that
14te criminalize-ion apprtesch would repre-
sent little more than a policy sestertion, for
tete enforceinent of such' a law would be vera
dintelie If not timetable. Successful prose'
mitten re onerupes?and lair defense in Teta-
eion to euch proseastions?would typicalle
depend upon access to vet Melia and infer-
nistion beyond the Teeth cit VS. judicial
process Other nations, rather than asest-
mg in Inch prorrchilOra, might resat co-
op/iodises beiceuee of considerations of na
reonal preference or sovereignty, Other ns-
tions might be espeollally offended if we
sought to apply rill:mime sanctions to for-
eign-incorporated ancleer foreign-managed
setedelterion of American corporations. The
Task Fierce concluded the; unless reasonably
enforceable criminal sanctions were devised,
Site criminal approach would represent poor
penile policy.
awed 111)011 analysis ,5 the sufficiency if
current law anct of the options described
&Dove, the President decided to bax the 0:M-
errell Le elmet legislate:us providiLlg for full
and systematic reporting and disclosure of
payments in connection with their emnares-
clal relations with foreign govenunents.
mopes= Tairrlice13Orl
lire Foreign Payments Diecleeure Act ven
tomtit- ,aportine to the Secretary of Com-
merce of teeter. Mama of payments Made
butilneases and their foreign subedi-
t, ie and &Milstein In relation to blueness
ith foreign goverm-nente. Specifically, re-
ports will be required of all pep:tient* Made
ii esainection with sale* to or contracts with
teenier: governments or official actieris by
foreign publics facials, where such are for
the commercial benefit of the payer or his
Sireen affiliate.
The report lag require r sen. ('oters fees of
agents and otter intermediaries and political
contelbutions ae well as payments made cli-
ne:tit to foreign public officials.
The legislation provides that the Secretary
of Cenuneree Wean lame regulations necessary
to wry out Its purposes. These regulatione
shall contain a requirement that reports in-
clude names of recipients of payments a rd
ehall establish a tfareshold amount below
which payments need not be reported, An
excePtion is made I..) this threshold concept
for Multiple pitymente totaling the threshold
amount with respect to a single transact:en
The Purpose of this threshold will be to ex-
clude so-called "grease" or "facilitating" pay-
ments. i.e., small payments to expedite low
les-el official actions such as customs process-
ing. Reporeng of such minor payments meld
create burdens far outweighing the benefes
',ought by the; legislation. The Secretary
will further have the authority to define by
regulation certain types of payments which
will uot be required to be reported becaree
they are regular business payments not in-
consistent with the pm-poses of the Act, or 15?
bona fide payments to a foreign government
such as taxes or other fees paid purseant it
law, regulates,' or other legal action.
The Secretary is aeso authorized to require.
by regulation, the keeping of records neces-
sary to carry out the purposes of the Act
and to make investigations, inspect bete,'
and issue subpoenas as necessary and ap-
propriate to the entercement of the Act.
Civil penalties are provided for failures tc,
report. or maintain required records or neg-
ligent omissions or misstatements In reports
flied. Criminel misdemeanor pereallies ere
provided for Knowing failures to file or to
maintain records or to Include complete or
correct information in records. Filing of a so-
port containing false statements of know-
ing Omission of required informat on will tie
penaezed as a criminal felony.
Reoorte tiled pursuant to this legislation
shall be kept confidential for one year from
the date of filing so as to protect busineei
proprietary concerns and to lessen possiole
foreign relations problems. On receipt, hew-
ever, the reports submitted to the Secretary
of et,mrnerre would be made available to the
Departments of State and Justice, the IRS
slid, where appropriate, to the SEC.
The Department of Justice or the State
Department can as appropriate relay infer-
inatien contained hi such reports to auther-
Cies in foreign jurisdictions. The reports ain
al-so be tranermeted upon request and with
appropriate senangements for confidentiality
to appropriate Contrrattees of the Congress;.
After the expiration of the one-year period,
reports will be made available for public
inspection and copying mime a specific writ-
ten determination :a made by the Secretary
of Slate that foreign policy interests diotate
against public disclosure, or a specific writ-
ten cleterminntion i inane by the Attorney
General that the status of an ongoing in-
vestigation or prosecution dictates against
public diecloeure through other than cen-
rent:one judicial processes.
Tie bill will Beek to avoid duplication of
reporting and recoed keeping requiremente.
First, it exerrpts ales of defense articles or
defense services under the arras Export Gen-
teel Act from the reporting requirements-3.
This exemption Is eased upon the fact test
the Army Export Control Act, as recently
amended, provides eor comprehensive report-
Li-mg to the State Department and the ?:'n-
graft of information regarding payments
with respect to as ch transactions. Sexed,
the Secretary of Commerce is given anther-
Sty to work wish other agencies to eemirette
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Ainnebessary duplication in reports and rec- First, -repayment of the readj uStment
or& The legislation eicPricitTy states! that stipend shall be ex banded over a 10-year
___, ,,
it is not desIgned`66 amend in any way cur- period with no int-nest charge; and -
rent legal requirementl relating to reporting _.
and disclosure, enforced by other agencies Second, the out tanding balance will
be forgiven if the serviceman dies as a
of government such as "the SEC and the IRS.
result of the service-connected illness
..
y,lfr. HUGH SCOTT: prior to repayment of the entire stipend.
S
, '74 A bill to amend section 3102
I believe this legislation deserves our 31.
support. The currelt regulations cast the
of t,tle:atc United States Code; relating
to the recover 'bthe United States of Government in a most unfavorable light.
i y --
I know you would agree if you had had
certain payments made to Veterans. Re-
to explain to Mrs Perkis and her two
ferted to the Cennnittee-on Veterans'
, --, - small children the t they would have to
Affairs. wait more than a year before they could
Mr. HUGI-1 scOrr. IVIr; President, to-
receive any money , notwithstanding the
day I am introducing legislation that will
fact that her hus-Jand was mortally ill
correct a "Catch 22"- Situation in our
Federal bureauciatic 'Machinery. "Catch with a service-connected disability.
22" Is a phrase Joseph Heller used in his I ask unanimoth- consent that the text
, , _
war novel of that name to refer to bu- of this bill be priitted in the RECORD.
reaucratic iliogiarom which the hapless There being no objection, the bill was
victim has no escape.r Or ed to be prir ted in the RECORD, as
Tragically, a Particidar'Catch 22" in follows:
our Federal regulations erniatiShed a late s 3743
conslituent Of Mine, John W. Perkis, a Be it enacted by the Senate and House
captain In .the kir porci Ttetierva, in its of Representatives o f the United States of
America in Congres assembled, That (a)
web Of frustratiOn and illogic. Captain
Perkis was, mustered Out Of the service
section 3102 of title 38, United States Code,
is amended by redesttnating subsections (c),
In a reduction in force. At that time, he (d), and (e) as subsections (d), (e), and
received a $15,000 'Stipend -for readjust- (f), respectively, and by adding after subT
merit to civillah hie. With this money he section (b) a new subsection (c) as follows:
Wight a home for his Vilfellid tw-o ChB.- "(c) (1) In any case In which a veteran is
dren and began a job' as --aProbation. of- determined to be aititled to coineensa.tion
- ficer with the PennsYlfania, 'Parole for a service-conneeted disability rated total
Board. in degree and the determination is made sub-
There was only one problem with this s
sequent to the time uch veteran was award-
ed a readjustment payment under section
new life: Captain Perkis felt ill much of 687 of title 10 by the armed forces, the re-
the -time. A physical exkmination resulted payment of any an ount of such readjust-
in the diagnosis of leukemia. The doctor mel a
p yment required by law shalt be made
confirmed that he had contracted the ill- bylittheveteran over such period of time as
ness 2 years earlier, and that It had gone the veteihn-may e'ect, not to exceed ten
undetected by routine Air Force physi-
years from the date on which such veteran
IS first paid disability compensation. The
CMS, veteran shall not be required to pay any
Captain Perkis applied fora veteran's interest on such readjustment payment.
disability pension and received 1t?$740 "(2) In any ease described in paragraph
a mOrith.,13,4, Rien the catch intervened. (1) in which the veteran dies as a result of
The GeverMhent said that since e , his 6PrviCP-,90nUec .tsc 0. di6AbilitY b efore the
wa.s" receiving the disa'bility pay he was total amount of the readjustment payment
required to return 75- pereenf of the re- has been repaid, the obligation to repay the
adjustment Stipend. That *mild be $11,- unpaid balance sha,l be. automatically can-
259. His disability checks would be with-
held until repayment tirainiacie_The Air
Force, to its great credit, tried its best
to help Captain Perkis, but it Vitas blocked
at every turn by the unarn-biguous lan-
guage of the statute.
On December 4, 19'75, shortly after he
and his family were informed of the
catch, Captain Perkis died Ofthe illness,
an entire year before he would have be-
gun Collecting his pension benefits.
PreSiderit, find it distressing that
an American who has served his country
SO Well was forced to suffer in such a
heartless thinner. MY bill attempts to
ease the hardship on the veteran and his
family if this highly unniuil 'situation
occurs again. It provides that if, after
honorable discharge _Re aLr:esult of re-
duction in force And the piyinent of the
readjustment Stipend a reserve service-
man is tliagposed to lip,ve;4 service-con-
neCted,illneses Jhat resulta,ip. 00-percent
celled.".
(b) Section 31021e), as redesignated by
subsection (a) of title 38, United States
Code, is amended by striking out the period
at the .end of such section and inserting in
lieu thereof ,the foliewing: "or cancelled un-
der subsection (c).".
Sac. 2. -Nothing.ii. this Act shalt be con-
strued to require the refund of any amounts
repaid to the Unite( States prior tc the date
of enactment of this Act.
ADDITIONA), COSPONSORS
A. 2925
At the request o Mr. MUSKIE, the Sen-
ator from Kansas (Mr. PEARSON) was
added as a cospon.ur of S. 2925, the Gov-
ernment Econom r and Spending Re-
form Act of 1976.
8 3441
At the request pf Mr. HUGH p-Jorr, the
Senator from Maryland (Mr. BEALL)
and the Senator from New Mexico (Mr.
?
MONTOYA) were added as cosponsors of
S. 3441, relating to the Congressional
Cemetery.
S. 3520
At the request of Mr. DOLE, the Sen-
ator from Minnesota (Mr. HUMPHREY)
was added as a cosponsor of S. 3520, to
extend the rural community fire pro-
tection program, and for other purposes.
S. 3606
At the request of Mr. INOUYE, the Sen-
ator from Tennessee (Mr. Mimic) and
the Senator from Alaska (Mr. GRAVEL)
were added as cosponsors of S. 3606, to
amend part B of title XI of the Social
Security Act.
S. 3665
At the request of Mr. BEALL, the Sena-
tor from Montana (Mr. METCALF) was
added as a cosponsor of S. 3665, a bill
to amend the Internal Revenue Code of
1954.
, AMENDMENT NO. 2155
At the request of Mr. FANNIN, the Sen-
ator frqm New York (Mr. BUCKLEY) and
the Senator from Alaska (Mr. STEVENS)
were added as cosponsors of amendment
No. 2155, intended to be proposed to S.
2657, the Education Amendments of
1976.
SENATE RESOLUTION 513?ORIG-
INAL RESOLUTION REPORTED
RELATING TO THE CONSIDERA-
TION OF S. 3554
(Referred to the Committee on the
Budget.)
Mr. PROXMIRE, from the Committee
on Banking, Housing and Urban Af-
fairs, reported the following original
resolution:
S. RES. 513
Resolved, That the previsions of section
402(a) of the Congressional Budget Act of
1974 are waived with respect to S. 3554, a
bill to establish a National Commission on
Neighborhoods.
AMENDMENTS SUBMITTED FOR
PRINTING
DEPARTMENT OF DEFENSE APPRO-
PRIATIONS, 1977?,H.R. 14262
AMENDMENTS NOS. 2180 THROUGH 2185
(Ordered to be printed and to lie on
the table.)
Mr. GOLDWATER, submitted six
amendments intended to be proposed by
him to the bill (H.R. 14262) making ap-
propriations for the Department of De-
fense for the fiscal year ending Sep-
tember 30, 1977, and for other purposes.
AMENDMENTS NOS. 2186, 2137, AND 2188
(Ordered to be printed and to lie on
the table.)
Mr. GOLDWATER submitted three
amendments intended to be, proposed by
him to amendment No. 2,146, intended
to be proposed to the bill (H.R. 14262)
supra.
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The development and exploration*"
costs, which our fishing industry- has ex-
pended to develop those fiehing grounds
has neen tremendous. They have long
fished those areas arid have gained lei:-
tot:ice' rights which must be recognized.
especially those fishing grounds which
are not overfished.
Many of these areas are not even fuLy
fished. In feet, catch data indicates they
have not tome anywhere near the limns
of their potential. In the case of shrine.).
in particular if they are not caught, tins
die and go to waste, and they certainly
are not presently being caught by the
Mexican fleet.
As I understand it, the Mexican fleet
hae re catch statistics to support the(
they "are presently fully harvesting the
shrimp, and their only argument is thee
mathematically they may be able to
catch them il they move some more boan
into toe area.
I tell m. colleag-aes that from my re-
lationship with our great number of Lean
isiana fishermen there is a big difference
'oeta-een having a boat and a net. and
catching shrimp, and if you do not be-
lieve it, I can show you a lot of "former
fishermen" who can verify that taking a
boat ond a ret out into the gulf does
not gearantee you are going to come in
with any shrimp.
11 .the Mexicans can substantiate by
catch statistios that they are, in fact
catching the full quantity of shrimp that
is available, and that no surplus existe
our people are entliled to go after that
surplus of shrimp.
I for one am going to see that every-
thing is done to insure that they have
that right, and if that means the fun
implementation of 'an embargo measure,
then to be it.
Yes, it le a matter of law', and that is
why ye put :t into the .law. Anyone who
thinks; we are not going to undertake to
enforce et ery aspect of that law has an-
other thins comine, and he had better
change his mind, quickly. I do not believe
in passing laws if you are not going to
implement them, and I do not believe in
implementing them unless you are goin.t
to enferce then.
When you In someone who says he
nut gclng to adhere to the law, you hate
to convince lien. If we do not have back-
bone enough to do that, then we do not
deseerve to be in the Senate, and if any
Meeic ii or Russian or any other foretell
natiot il thinks we're going to do other-
wise, he has not Wired to me lately. As
far at this Senator is concerned, if NV
cannot go. into that area after the
shrine-, tht t is et:at:able in surplus, then
we do not need one shrimp in this coun-
try that (tomes out of that area. They
can just keep it down there in Mexico
and do anything they want to with it.
One thing is for certain?I will not
have the concern of going to the table in
this country and eating a shrimp and
wondering if it is coming from a country
that it denying a livelihood to our Amen-
ADDITIONAL STATEMENTS
S. 3720?PROMOTION OF THE AMER-
ICAN SHRIMPING INDUSTItY
Mr. LONG. Mr. President, I avant to
congratulate my colleague from Florida
(Mr. Canis) for the outstanding work
he is doing in sponsoring S. 3720, to in-
sure the survival and good health of the
American shrimping industry. I thank
the Senator for the explanation of the
bill he gave the Senate yesterdi y and
appreciate in every instan:e the points
he has covered. I fully support his efforts
In this regard, and I am Lonorec to be
joining the Senator as an acti *la-
sponsor on this legislation.
I think it is long overdue that e give
the kind Of protection offered by se 3720
to our shrimp industry, the kind of sen-
Bible and enforceable protection winch
these independent hardworking. (
seientiaus fishermen sp richly desetvc
Mr. President, I tusk tie Sen to
take note of the fact, as Senator Caters;
Feinted out yesterday, chat our country
represents a market for approeitnately
;200 million worth of shrlrap eace ;:( at
from Mexico. A considerate fraction of
all Mexican seafood production comes
Into our markets.
However, in recent talks with ::;c an
;
officials, I am informed teat our Ctov-
eneMent and its industry represen- atives
have teen faced with an nconside nte
and intransigent neighbor who his ad-
vised that It could care less of our inter-
est and needs, or the fact that a veluable
resource will waste because of its ex-
treraele short lifespan. The Mexican ne-
gotiations have merely poirted to Is31-10-
thetical mathematical projectio is as
Justification for denying out fleets, many
of which happen to be coestituean of
mine, access to traditional finery
grounds.
I have been told that the Mexican ee-
getiators have ignored reasonable offers
by U.S. negotiators, I undorstanel they
have cited our 200-mile economic zone
provisions when it suited their cease.
and ignored them when they tended to
conflict with the Mexican interest
Furtner, they have bluntly Indic t( (I a
belief that the 'United Sta.' e3 the
will and the backbone to enforce that
law?a,; Senator Cinees stressed y csar-
day, the Mexican negotiators feel tint
we be particularly hesitant -in en-
forcing those provisions a hich tcel re
embareoing seafood product, from coun-
tries which refuse to negoi tete it peon,
conscience to provide accets to :in (ry
surplus es.
Now Mr. President I do at. th(
Members of this body ben( no en: rush
thing. This Senator cert.:July
that the 200-mile economic :01.0 pro-o-
sion, just like any other late shall(' be
totally and fully enforced agairst ill
parties. It was intended as a compie-
hensive fishermen's protectite act. Ls, a
cosponor of the legislatior, . I cei taitly
intended it as such. I agree eet Sete tor
CILILES that if it is not honored, if it is
not fully enforced, It 011 be worthless
a.r.d a fraud on the fishermen. Now that
it if? law, I will undertake every effort, as
cbatrman of the Finance Committee
which has ittriediction over trade legis-
lation to see that it is fully implemented
and stringently enfOrced---eaCh and
every aspect of it. may I emphaaize. -
Among other things, S. 3720 would pro-
vin- for :
An annual quota on shrimp imports,
or a country-by-country basis. Quota to
oqual the average of 1971, 1972: and 1973
ccc-ports from such country.
The anntml :quota would be further
deined to prevent more than 10 percent
re the annual quota in any 1 month.
!eve and one-halt percent duty to be
teemed to improve and stabilize the mar-
ket. establish research and consumer ed-
nosotton pregrams. Additionally. estab-
t funds?to be used to Purchase shrimp
or sertfood surphis for sehool lunch pro-
!et:ens-nein:1i as agricultural section 32
nrwrann whereby imports duties on for-
eign acricultural commodities are used
to purchase domestic commodity surplus
tor the school lunch and food assistance
IINVTRTTIS.
The Secretary of Commerce could be
authorized to adjust the quota levels an-
nually or monthly as the mareet demand
riatifled
:vir. President, rather than discuss
egem the basic and ooropelling rationale
welch argues so strongly for this bill. I
weed like to comment further on one
tispect of the subject discussed by Sen-
ator CHILES yesterday. That is tite trade
reletionship which exists between this
country anti Mexico.
Pi tinkly. I have long considered shame-
Jul the a-ay we have refused to stand
toes and to implement and effectively
enforce our laws when dealing with for-
eign emu-Ate:es. We consistently .impose
untielievable restrictions ,and regulations
coi our own citizenry and blast them into
otievion if they fail to heed each and
every aspect of them.
Lot whet: we establish laws that have
in impact on foreign rettionels or cOUn-
11.3;-t,o-country relationships. our State
leeitatenent typically finds some way to
t.
oil awe Justify that country paying
little or rto attention to them. Further,
tte beed r backwards giving aid and
6ilkor: to every country in the world,
O;l'?i?-ho merit it and some who do not,
:en went ask whet is only a reason-
:. eeno to;. of well-established
I oat hate long since deserved,
v :tois ese developed and gained, they
vetrele, tvil us they could care less.
':.?)'r:Llty tuc-7, our tails, come !ionic
. anecr.
,).!neiiran people tlo lot 'rant us
1itt tine'.Vay. I koow for a fact they
-i.,stand and be counted like
co. Tee Inedreci years ago our fore-
it en s tousle. and died to give us this
cotaate , -.oe should nqt give it. away?
.01' hind or III 'Oahe., or in resources,
to v7lits ntinel Over the sears,
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gust 6, 1 97Approved ForeTO1*GRE3800/618i0,3RIMADRDP-ZMNATS000100100025-2
,
910 fishernien y p119w#4 a surplus re-
sterce to (Xie. arid waste aNiaY at sea.
7_ ss-liits*=
-
FOOD PROSPECTS_IN TITh
nIvEtOisiotf vcrptirx,
Mr. HUMPE1REY,, MrPresident I
- _
wish to bring to your attention an
August 3 article in the New' York Times
by Victor K. Metlheny entitled "Dou-
bling of Food peficit of Tropical Nations
Possible."
The article was based :On a study by
the Food Policy Research Institute, an
?organization tonna- after' the World
Food Conference of late 1974. The In-
stitute estimated that, in contrast to
the food deficit of 45 Million tons of
recent Years In the food deficit coun-
tries, that level could rise to 95 to -108
million tons by 1985-86. I recall at the
time of the World `11o&d t?Orerence that
many experts had estimated that the
food deficit could reach as high as 85
million tons.
The study of the institute, under Dr.
Dale E. Hathaway, formerly of Michi-
gan State University and the Ford
Foundation, pointed out that in the 15
years UP to 1974, food production rose on
an ,average of 2.5 percent per year, biit
In :the last _haft' of the period that rate
had dropped to 1.7 percent.
If the more recent trend's were to con-
tinue the food deficits could range as
high as 200 million tons.
In this rather somber' Picture, one
bright spot is the Asian Wheat produc-
tion, which has increased an average of
6.9 percent over a 15-year period ending
in 1974, and these increases are based
largely on the high-yielding wheat va-
rietie,s developed at CIMMyT in, Mexico
under Dr. Norman Borlang.
The study did project that Pakistan,
Biazil, and also the People's Republic
of China could turn into toocl exporters
by ;985-86.
Ir. President, I ask unanimous con-
sent that this article_ be printed in the
ORD.
,here being no objection,, the article
waS ordered to be printed in the RECORD,
asfollows:
DOLTBLING OF V9013 DEFICIT OF TROPICAL
NATIONS PosSIBIS
(By Victor K. McElheny)
Food deficits in many pisor tropical na-
tions could be double those of the,, crisis
year 1974-75 in less than a decade, accord-
ing to a study by the International Food
Policy Research Institute.
To overcome the expected, shortages, the
Washington-based institute estimates, na-
tions with surpluses will be called on to
make large increases in fOod aid, and deficit
nations will be ferced to ett*pt a doubling
of their annual increases in food _prdduc-
tion, to four from roughly two percent.
In the 1974-75 span, food deficits in poor
countries, largely in the tropics, totaled 45
Million tons, the recently formed food policy
institute said. In the 198544 , period, de-
pending on whether economic growth has
been slow or fast, the deficits would be 95
to 108 million tong.
- The report containing these forecasts was
discussed at the annual meeting in Wash-
ington last week of the agencies that finance
a group of international -agricultural research
? penters.?1es, Ann to increase the yield
of inajor food crops of the tropics. The meet-
ing of the supporting agencies' Confirmative
Group on International Agricu:tural Re-
search is known informally an "centers
week."
'Dr. Dale E. Hathaway, an economist form-
erly at Miehigan snsite University and the
Ford Foundation, heads the institute, which
was formed in the aftermath of the World
,,Food Conference in. Rome late Ir.. 1974.
The institute's report said that the short-
ages it was forecasting could even be greater.
In the 15 years ene)ing in 1974, food produc-
tion rose an avetage of 2.5 peicent each
year, but in the last half of the period?
becanse'bf 'weashes or Other din -mities yet'
to be measured--thc rate of vIncrease dropped
to an average of 1.7 percent
The report called this drop in 1:he rate of
increased production "pervasive" among re-
gions and major cereal grain crops. Thus, the
report said, "it may well be difficult for de-
veloping, market-esonorny. food-deficit na-
tions to maintain t heir longer-term produc-
tion trends."
If the more recsnt trends prevailed, the
food deficits of 1985-86 could add up to 200
million tons instead of 100 million, the re-
port said. ?
The institute said this amount of food
would be ditficit so transport where it was
needed, even if sitch surplus praducers as
the United Stretef-. Canada, South Africa,
Australia and Argentina had enough to ship,
and financing for all the needed food could
be arranged.
The institute report said, "Such a large
transfer of food, largely from developed
countries, could well be unmanageable phys-
ically or financially."
The declining rate of increase in poor
countries' food-grain production occurred
in spite of widespread introduction of so-
called "green revolution" varieties of wheat
and rice, the report noted.
The only exception to this was the raising
or wheat in Asia, Over the 15-year period
ending in 1974, Asian wheat production in-
creased an -average of 63 per cent annually:
In the last half of the period, starting iii
1967, the rate jumped to 8.2 per cent.
It was in 1967 that large-scale ;growing of
high-yielding wheat varieties, developed in
,ivexice, began in such regions as the Punjab
in India and Pakiviana _
Of the food deficits projected by the in-
stitute for 1985- 86. about 40 per cent would
fall in five areas; India, Bangladesh, Indo-
nesia, Nigeria and a group of low-income na-
tions south of the Sahara.
According to the institute, two food-im-
porting market-economy nations of today,
Brazil and Pakistan, could turn into ex-
porters by 1985-86, and so could the People's
Republic of China.
China, the ins' itute suggested, might
choose to use its surpluses to improve local
diets or those of nearby Communist states
rather than enter world export markets.
CLEAN AIR ACT AMENDMENTS OF
? 1976
Mr. CURTIS. Mr. President, I am not
opposed to clean air. I think that the
program implemented to date under the
Clean Air Act has been most effective in
cleaning up the Nation's air and in pre-
venting air pollution. However, lie Clean
Air Act amendments which we:re passed
by the Senate yesterday go far beyond
S13813
what in my opinion is a reasonable and
economically justifiable program for air
pollution abatement.
Under the Clean Air Act, ambient air
quality standards of two levels have been
established to insure the health and wel-
fare of the Nation. They are levels that
have been deemed to be minimum air
quality levels required to protect the
health of human beings and welfare of
animal and plant life around us. They
include substantial margins of safety be-
tween actual levels of pollution that
would endanger health and welfare, and
the minimum pollution level standards.
We are achieving the degree of health
and welfare protection that has been our
objective under the existing program.
But, the new standards which will call
for a level of no significant deterioration
to be added have ominous implications.
Under this provision, the Environmental
Protection Agency will proceed with
plans to establish areas nationwide where
no additional pollution of any signifi-
cance will be permitted even though the
areas may be virtually pollution free.
Such areas will include much, if not all,
of the Western States. Nebraska will be
among those States.
The new standard will mean that no
electric generating plant or other power
production facility will be able to be
built if it adds any pollution to the at-
mosphere; that no new manufacturing
plant or industry will be allowed to be
built if it cannot completely eliminate
its discharges of pollutants into the air;
that no new municipal solid waste or
other waste treatment facility or utility
will be permitted unless it is devoid of
any air pollution.
I have heard many claims by propo-
nents of this measure that it would not
affect housing and normal business ex-
pansion and community growth. Yet,
under the terms of the bill with its em-
phasis on the aspect of "significant de-
terioration," I fail to see where any area
of growth or development would not have
some effect on air quality by adding to
air pollution. Just what amount of pol-
lution will be considered "significant" we
do not know.
Proponents of this new provision re-
fused to consider the economic ramifica-
tions it would have in the floor debate.
Their conclusion, from the remarks I
heard and read, was that any price is
worth paying to have completely pure
areas maintained in the pristine and pol-
lution-free West.
A major problem I have with that posi-
tion relates to the fact that to date there
has been no scientific development or
technical achievement that can provide ,
us With the devices necessary to keep our
air absolutely pure. That leaves us with-
out the ability to develop the critical
energy production facilities that are
needed to meet our future energy needs.
And, as we may be able to develop such
facilities the costs for, our energy may
quadruple in a short time because of the
unreasonable expenses in cleaning up the
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S 13814
last ore-tenth of 1 percent or so of air
pollution.
While it is admirable that we strive
for absolute pure air, I think it is un-
reasonable to demand that we take a
stand at this time against any and all
polluti m when we do not have the tmli-
nological improvements necessary to
achieve the goal and still allow far nor-
mal economic growth. The obvious re-
sult of this position will be ecielciaic
stagnation.
We hhould be concerned about the ,e-
vere energy crisis and its effect on our
economy, As we spend hundreds of
cf dollars to install onprois n and
poorly !auctioning air pollution devices,
and as other electric generation facilities
cannot be built to meet growing needs.
our dependence on foreign energy Four!es
will increase. We are already running a
deficit balance of trade fer fore rr oil
purchases in the tens of billions of dol-
lars.
There are other side effects that will
be as disastrous to our economy. Money
that will be used for short-term file pol-
lution solutions will take away from the
hundreds of millions of dollars that are
needed in other segments of the ecenomy
to provide housing, business operating
loans, capital expansion and indiiidual
and business credit, all of which spur the
economy. The shortage of capitol and
the slowdown of energy pi oduction will
adversely, affect our employment Attie -
tion.
Mr. President, hopefully the 11 ng of
Representatives will give greater ...on-
sideration to the impact of the no signif-
icant deterioration provision as ?..t rem-
siders this bill. I think the Senate has
unwisely passed another bel on the basis
of emotion rather than reason. I -errand
my colleagues of past ill-conceived legis-
lation that has returned to haunt le in
the Congress.
One such bill is the Occupialorsil
Safety and Health Act of 1970. At the
time we considered that legislation, we
were all taken up with e concern for
the safety and health of the Nation's
Workers. What could be less control, er-
ste.' than a measure to insure safety and
health in the work place? Few members
of Congress found any fault in that tests-
latiOn. but few Members thought to con-
sider the cost and effect of the leg ala-
tiorf on the Nation.
What it boils down to is a need to
apply the time-proven test of cost effec-
tiveness. I am not saying that a Dr-kr
should be put on the level of es'ety we
should seek for human beings What T
am saying is that we too often fall to
consider the overall impact of let iela-
tion, both on the economy and on the
people directly.
In the case of OSHA, little attention
was paid to the impact the act would
have on small businesses. As I reeall,
OSHA was primarily intended to get at
large Industries that had poor or no
work safety and health programs and
standards. Yet the act teamed csit to be
a nemesis for small business arcl seri-
Approved FocemciffsnmskyokEgffitty:27,kparirm0001001000.a5h3ust 6, 19Z0-
the life expectancy of Arndricans in gen-
eral without, to any appreciable extent,
diminishing the ravages of age. As a re-
sult, we have a vast and growing army
of homebound elderly Americans denied
association with the outside world, al-
most in the nature of persons imprie-
oned on a remote desert island. That is
the giant social problem involved. But.
there is also a gloat economic problem.
A notable proposal to help solve this
situation is S. 3681, a bill to amend the
Older Americans Aet of 1965 to provide a
national meals-on-wheels program for
the elderly. II enacted, this measure tt7M
rescue millions of our elderly from sev-
eral enemies at once?malnutrition, poe-
erty and loneliness.
The meals-on-wheels program wal
provide food and company to those un-
able, in consequence of infirmity and
age. to seek et on their own, which ex-
pedites their institutionalization. Info:-
matron gathered by the Senate Sele:t
Committee on Nutrition and Human
Needs estimates indicate that as many
as 3 to 4 million older persons?repre-
senting 1 out of elderly?are unable
to benefit from the regular meals-on-
wheels program as offered by title vn of
the Older Americans Act.
As matters stand today, under title
VII, some 430,000 hot meals a day and
various supportive services are available
to persons able to attend a congregate
setting. Unfortunately, this arrangement
excludes the 3-4 million homebound el-
derly. Often the need for an adequate
diet has forced many elderly into institu-
tions or nursing homes?a most certain
costly waste of dollars and human re-
sources. Under the current congregate
approach, feeding the estimated needy
homebound would require a title VII pro-
gram expo.nsion in the area of 1,700 per-
cent, Attempting to meet the need of
the homebound elderly under the present
design of title VII without a separate and
additional commitment is impractical
and highly unlikely.
I, therefore, wish to give my whole-
hearted support for S. 3685, the National
Meals-on-Wheels Act of 1976, a conune-
nity-oriented seri/Ice project based upon
the elements of kindness and concern
that have rendered our country, not only
the strongest in the history-of man, but
the best in every vital particular.
culture. Because Congress ambiguous
approach to OSHA failed to consider the
overall impact of the legislation, we
have had regulations of such detail that
the act has plagued the smill business
community ever since.
With the implementation of OSHA.
mens- small bsinesses have been forced
to close. Employment has been adversely
affected. Yet we spend millions of dol-
lars on publications of pamphlets such
as that warning farmers that "manure
,f; slippery and could cause a fall.-
OSTIA is not the only example of Fed-
eral law and regulation that has ad-
mealy impacted on the economy and
rreployment. The air pollution programs
being carried out by the Environmental
Piatectlon Agency have led to forced
eta ins s of businesses and have resulted
to eneniployment of thousands of per-
son; as reported by the Labor Depart-
ment.
Mr. President, at a time when we have
been wrestling with high unemployment
in the United States. I am amazed that
Cor,grees could enact laws that seem bent
or a nonemployment course. When we
erect legislation that leads to a drain on
available capital, that results in Job
leases. that forces small businesses out of
existence. and that adds another bu-
reaucracy on top of our already too large
Federal payroll, are we truly acting in
she interest of the Nation?
No. We are only increasing the unem-
ployment rolls and the need for welfare
while decreasing the tax revenues of bus-
mes and individuals which are necessary
to meet those growing welfare costs.
Where will it end? Truly the American
taxpayer is becoming an endangered spe-
cies, and just as truly our American way
of life is being endangered.
I sincerely hope that our colleagues in
the House will give the issue of significant
deterioration the consideration needed to
evaluate Its impact on the citizens and
the economy. If they should fail to weigh
the dk;astrous effects of this bad legisla-
tion. I will urge the President to veto the
Mr. President if significant deteriora-
tion is implemented, I suspect that those
or us who will be here in the 95th Con-
gress will again be wrestling with the
issue as the States and communities
arross the nation begin to feel the impact
of the program, It Is inconceivable to me
why we must establish programs only to
nave to spend our time and efforts to
rectify our mistakes later, where in the
first place we could have given careful
cesisideration to all aspects of a bill and
tiwored it accordingly.
'1 s, esT ONA L MEALS-ON -WHEEL.a
ACT OF 1976
Mr. riOMENICI. Mr. President, I would
like at this time to express my support
for a measure of the most profound im-
ecotone-e to millions of American cit-
ens--.the National Meals-on-Wheels
art of 197e.
The benefits ef science have increased
ACTIVITIES OF THE UB. RAILWAY
ASSOCIATION
Mr. STONE. Mr. President, I would
like to commend Treasury Under Secre-
tary Jerry Thomas, a fellow Floridian,
for his effort on behalf of Amerieen tax-
payers to scrutintm the activities of the
U.S.' Railway Association. The associa-
tion is a public entity and is supported
by taxpayer funds. Under Secretary
Thomas, a member of the USRA board,
requested an audst of the association's
financial records when he heard ane-
gations that high efficials of the associa-
tion' were receiving special benefits at
puble expense. The Washington Star of
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