EXPORT ADMINISTRATION ACT AMENDMENTS OF 1979

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85-00003R000100030010-3
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 16
• Document Creation Date: December 21, 2016
• Document Release Date: October 27, 2008
• Sequence Number: 10
• Publication Date: July 23, 1979
• Content Type: OPEN SOURCE

H 6404
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CONGRESSIONAL RECORD -HOUSE July 23, 1979
while the final financial arrangements
are being resolved.
UNITED STATES RAILWAY ASSOCIATION
The bill allocates $23.9 million for the
administrative expenses 'of USRA and
$550 million for the purchase of ConRail
securities. The committee is conscious of
the need to hold down litigation costs
and feels that the recommended amount
is sufficient to effectively litigate the is-
sue of valuation of the assets transferred
from the bankrupt railroads to ConRail.
The committee is concerned about the
windfall which has inured to many Con-
Rail employees as a result of title V em-
ployee protection payments. Consequent-
ly, we have placed a limitation in the
bill which prevents payments from pass-
ing under title V after December 31, 1979,
unless an employee has been actually de-
prived of employment, or if one's em-
ployment has been materially dimin-
ished.
WASHINGTON METROPOLITAN AREA TRANSIT
AUTHORITY
Finally, our bill provides for an in-
crease of $14,187,000 over the budget
estimate for fiscal year 1980 for WMATA.
Prior to the distribution of these funds,
the Secretary is permitted to establish
terms and conditions that the local gov-
ernment must meet in order to obtain
these funds. This is consistent with the
need to exercise close control over the
financing of the necessary capital and
operating costs of the system.
THE SAINT LAWRENCE SEAWAY
The Saint Lawrence is recommended
to receive the full Presidential budget
request of $1,372,000 to pay for the op-
eration and maintenance of the St.
Lawrence Seaway between Montreal and
Lake Erie.
CONCLUSION
Due to the recent upsurge in mass
transit ridership, and the ever constrict-
ing energy supply and hints of a future
recession, the subcommittee has felt it
necessary to alter its original recommen-
dation and urge the increased funding
of this labor intensive enterprise; there-
fore, the subcommittee is requesting an
additional .funding of $242.5 million.
Likewise, Amtrak has also felt these
same pressures, and the subcommittee
is urging additional funding of $40 mil-
lion. The cumulative impact of these
major amendments is an increase of
$282.5 million over the committee's
original request.
I say to my colleagues this represents,
in my judgment, a well balanced budget
for fiscal year 1980 for the Department
of Transportation and related agencies.
Before yielding the floor, let me ex-
press my gratitude for. the manner in
which the distinguished chairman of the
Appropriations Committee (Mr. WHIT-
TEN) has carried out his responsibilities
this year. He has done a remarkable job
in seeing that the hearings, markups
and so-forth of appropriations bills are
conducted in a manner that enables the
appropriations process to meet the many
deadlines and schedules that are set
for us.?
? Mr. OBERSTAR. Mr. Chairman, dur-
ing the markup of the Coast Guard fiscal
year 1980 authorization, I offered an
amendment in the Merchant Marine and
year 1980 appropriations bill prior to en
actment of this authorization. The legis
lation before the House today does not
appropriate any funds specifically for the
fixed aid-to-navigation.
The committee report does, however,
note the authorization and state that suf-
ficient unobligated funds exist in the
Coast Guard appropriation to install the
fixed aid-to-navigation. I will be working
in the new fiscal year to encourage the
Coast Guard to act to install the fixed
aid. The Coast Guard itself has identi-
fied the need for 10 fixed aids in conjunc-
tion with the extended shipping season
program on the Great Lakes.
In authorizing one fixed aid, the Mer-
chant Marine- and Fisheries Committee
recognized the critical importance of the
Pt. aux Frenes site. In recent years, two
ore boats have grounded in late season
with estimated damages in excess of $3
million. The weather conditions of late
fall and winter require the fixed aid at
Pt. aux Frenes.
The Coast Guard has a suitable design
for the fixed aid.
While the initial cost of the aid is, of
course, higher than the buoys, the main-
tenance costs are far less. The fixed aids
are not removed in late fall and returned
in the spring as the buoys are. The buoys
also suffer considerable damage from ice
at the end of the navigation season.
The fixed aid would be a wise use of
unobligated funds.?
Mr. DUNCAN of Oregon. Mr. Chair-
man, I have no further requests for time.
Mr. COUGHLIN. Mr. Chairman, I have
no further requests for time, and I yield
back the balance of my time.
Mr. DUNCAN of Oregon. I yield back
the balance of my time.
The CHAIRMAN. The Clerk will read.
The Clerk read as follows:
H.R. 4440
Be it enacted by the Senate and House of
Representatives of the United States of
America in Congress assembled, That the fol-
lowing sums are appropriated, out of any
money in the Treasury not otherwise appro-
priated, for the Department of Transporta-
tion and related agencies for the fiscal year
ending September 30, 1980, and for other pur-
poses, namely:
Mr. DUNCAN of Oregon. Mr. Chair-
man, I move that the Committee do now
rise.
The motion was agreed to.
Accordingly the Committee rose; and
the Speaker pro tempore (Mr. MURTHA)
having assumed the chair, Mr. STUDDS,
Chairman of the Committee of the
Whole House on the State of the Union,
reported that that Committee, having
had under consideration the bill (H.R.
4440) making appropriations for the
Department of Transportation and re-
lated agencies for the fiscal year ending
September 30, 1980, and for other pur-
poses, had come to no resolution thereon.
GENERAL LEAVE
Mr. DUNCAN of Oregon. Mr. Speaker,
I ask unanimous consent that all Mem-
bers may have 5 legislative days within
which to revise and extend their remarks
EXPORT ADMINISTRATION ACT
AMENDMENTS OF 1979
Mr. BINGHAM. Mr. Speaker, I move
that the House resolve itself into the
Committee of the Whose House on the
State of the Union for the consideration
of the bill (H.R. 4034) to provide for
continuation of authority to regulate
exports, and for other purposes.
The SPEAKER pro tempore. The
question is on the motion offered by the
gentleman from New York (Mr. BIN(;-
HAM). _
The question was taken; and the
Speaker pro tempore announced that the
ayes appeared to have it.
Mr. CARNEY. Mr. Speaker, I object
to the vote on the ground that a quorum
is not present and make the point of
order that a quorum is not present.
The SPEAKER pro tempore. Evidently
a quorum is not present.
The Sergeant at Arms will notify
absent Members.
The vote was taken by electronic de-
vice, and there were-yeas 217, nays 5,
not voting 212, as follows:
[Roll No. 370]
YEAS-217
Abdnor
English
Kostmayer
Akaka
Erdahl
Kramer
Ambro
Ertel
Lagomarsino
Anderson, Ill.
Evans, Ind.
Leach, Iowa
Annunzio
Fenwick
Lehman
Atkinson
Findley
Leland
Bafali@
Fisher
Levitas
Bailey
Fithian
Lewis
Barnard
Flippo
Livingston
Barnes
Florio
Loeffler
Bauman
Foley
Long, La.
Beard, R.I.
Fountain
Lowry
Bedell
Fowler
Lujan
Benjamin
Frenzel
Lungren
Bennett
Fuqua
McClory
Bereuter
Gaydos
McCloskey
Bethune
Gephardt
McCormack
Bevill
Ginn
McHugh
Biaggi
Gonzalez
McKinney
Bingham
Gore
Maguire
Blanchard
Gradison
Markey
Boggs
Gramm
Marlenee
Bonior
Grassley
Mathis
Booker
Guarini
Mazzola
Bouquard
Guyer
Mica
Bowen
Hall, Ohio
Mikulski
Brademas
Hamilton
Miller, Calif.
Brodhead
Hance
Miller, Ohio
Brooks
Hansen
Mineta
Brown, Calif.
Harkin
Mitchell, N.Y.
Brown, Ohio
Harris
Moffett
Carter
Hawkins
Moilohan
Cavanaugh
Hightower
Montgomery
Chappell
Hinson
Moore
Coelho
Hopkins
Moorhead,
Collins, Tex.
Horton
Calif.
Conable
Hubbard
Murphy, Pa.
Corcoran
Hyde
Murtha
Corman
Ichord
Myers, Ind.
Coughlin
Ireland
Natcher
Courter
Jacobs
Neal
Daniel, R. W.
Jeffords
Nichols
Dannemeyer
Jeffries
Oakar
Daschle
Jenrette
Oberstar
de le Garza
Johnson, Calif.
Obey
Deckard
Jones, N.C.
Paul
Dingell
Jones, Okla.
Pease
Dixon
Jones, Tenn.
Perkins
Donnelly
Kastenmeier
Peyser
Drinan
Kazen
Pickle
Duncan, Oreg.
Kelly
Price
Duncan, Tenn.
Kemp
Pritchard
Edgar
Kildee
Rangel
Edwards, Calif.
Kogovsek
Ratchford
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July 23, 1979 CONGRESSIONAL RECORD-HOUSE
Highw Administration we have pro-
vided ne rly $107 million. Despite the
fact that is is approximately $6.3 mil-
ittee's recommenda-
ation of $35 million
H 6403
Increase of $8'million over the budget re- would benefit as few as 4,000 people. If
quest. This is a good program which I these statistics are right, that means a
believe deserves this additional funding. cost of $1.8 million per person.
The budget request included $250 mil- Section 321 of the Surface Transpor-
.lion for a new railroad restructuring as- tation Assistance Act requires a study of
sistance program to replace the existing this issue. Pending the completion of
title V ,preference share program. Such that study, the committee is recommend-
restructuring assistance legislation has ing language which would prohibit the
not been considered by the Congress use of funds to retrofit any existing rail
during this session, therefore, the com- transit system to comply with the section
mittee has not approved any of the funds 504 regulations.
requested for this program. NATIONAL TRANSPORTATION SAFETY BOARD
T
ding for this
eceived con-
ghway
t, $9.5
an increase of $4 million over the budget
for the bicycle program which was au-
thorized by section 141 of the newly en-
acted Surface Transportation Assistance
Act.
NATIONAL HIGHWAY TRAFFIC SAFETY
ADMINISTRATION
We have provided $82.6 million for the
National Highway Traffic Safety Ad-
ministration; which is $4.9 million below
the administration's request and $752,-
000 below the fiscal year 1979. In
recommending a reduction of $4.9 mil-
lion, the committee expressed its belief
that sufficient resources will be available
for the significant automobile saftey and
fuel economy programs proposed by the
National Highway Traffic Safety Ad-
ministration. The reductions are com-
prised as follows:
Rulemaking programs, $900,000;
Enforcement, $250,000;
Highway safety, $1.6 million:
Research and analysis, $1.8 million;
and
General administration, $294,000.
The committee's recommendation in-
cludes neither the program to develop
crashworthiness ratings for automobiles,
nor funds for the public participation
program.
The committee directs the National
Highway Traffic Safety Administration
to determine to what extent duplication
or potential for duplication exists among
its many data collection systems. As
part of this exercise, the National High-
way Traffic Administration Is to imple-
ment a plan to eliminate duplication of
effort and unnecessary costs, and to re-
port to the committee before January 1,
1980, the results and justifications for
each data system retained.
FEDERAL RAILROAD ADMINISTRATION
For the Federal Railroad Administra-
tion, we have provided nearly $1,538 bil-
lion which is nearly $133 million less
than the administration's request, but
$?5 million above the fiscal year 1979
budget. The amount includes $25.9 mil-
lion for railroad safety. Nearly $54.7 mil-
lion for railroad research and develop-
ment, and $92.2 million for rail service
assistance. This amount includes $75 mil-
lion for local rail assistance, which is an
he committee recommends the full The National Transportation Safety
budget request for $481 million for the Board has received $16.7 million, its full
reconstruction and improvement of the budget request. This is $1.13 minion more
railroad plant and right-of-way between than the amount appropriated for fiscal
Boston, Massachusetts, and Washing- year 1979. This increase is primarily to
ton, D.C. As the report language in- cover pay costs, inflation, and additional
dicates we were concerned about serious accident investigations. NTSB serves a
slippage in meeting the project's con- vital function to the public by investi-
struction goals. As a result of the goals gating the causes and developing recom-
established in the redirection study, the mendations to prevent accidents, such as
committee believes that the steps that the recent airplane crashes at San Diego
have been taken are in the right direr- and Chicago. This expertise is a vital
tion. Testimony indicates that the per- component of securing-public confidence
rmance during the 1978 construction in our national transportation system.
se on was substantially better than
dur the previous season. CIVIL AERONADTICB BOARD
URBAN ASS TRANSPORTATION ADMINISTRATION We provided the CAB with $28.3 mil-
The r ommended funding for UMTA lion, a reduction of $24 million below the
for 1980 cants to $3.5 billion, includ- administration's request for salaries and
ing $2.78 1 direct appropriations, and expenses. The committee also recom-
$775 million contract authority. With mends the full budget request of $76.1.
respect to the administrative expenses million for payments to air carriers.
the bill includes appropriation of $19.3 This includes $69.1 million for existing
million. This am t, plus the use of 406 subsidy program, and $7 million for
UMTA's personnel an
ments. This is $56.4 Ii n more than transportation to eligible communities.
$ 62 The committee is pleased to report that
the budget request and~ t79
more than the fiscal year 1
A summary of the Deregulation Act'has increased com-
the co 'ttee's rec- Petition, as well as reduced the price of
ommendations by account are follows: airfare to the public.
Administration and resear , $82.8 ice
million;
included an
appro-
8 oil- For
Urban discretionary grants, $1.
lion ; priation the of $76.1 ICC, we million, a reduction of
approximately $5 million from the ad-
Rural and small urban grants, $75
lion; request. Part of this re-
lion; n-
duction is attributable to the elimination
Urban formula grants, $1.425 million,
of the rail public counsel. It is the view
Waterborne demonstration, $10 mn-
of our committee that the Commission
lion; and
Interstate transfer grants, $700 mil- p
s the capability of insisting that the lie Interest be represented within the
lion. sion's existing resources.
With respect to the urban initiatives
program, the committee is recommend-year. Congress mandated that the Ion hire 30 additional qualified
Co
ing a level of $80 million, of which $17
rail sere
million is to be provided for the contin-e agents. At the time of our
hearings,
ICC
had not
ued development of South Station in
that mand e
Boston, Mass. It is important to note that to and many ran service
completed agents which ere hired were not quali-
the funding level for urban initiatives has
fied. It is our commendation that the
been reduced by $120 million because we
ICC finish the icing of 30 rail service
do not believe that more than $80 million
agents, and that ey all be qualified to
should be diverted from the basic section
assist the raflroa in improving their
3 programs which are essential if public
transportation is going to survive in our freight service.
Nation's cities. PANAMA AL
With respect to implementation of the The funding recomm dation for the
regulations issued pursuant to section 504 Panama Canal is $255 mill n for operat-
of the Rehabilitation Act of 1973, the ing expenses and $25.1 milli for capital
committee is concerned that it might re- outlay. This appropriation is or the 6-
quire the expenditure of vast sums with month period from October , 1979,
only minimal benefits to handicapped through.March 31, 1980. It is a ential
persons. Transit people estimate a cost that this appropriation be made, ot-
of $8 million to implement the section withstanding the fact that the Pana a
504 regulations. One study the commit- Canal implementing legislation has no
tee read indicates that 90 percent of the been signed into law. This will provide
cost of implementation, section 504, for the continual operation of the canal
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ricted authorities, a new section 419 program that requires
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July 23, 1979 CONGRESSIONAL RECORD -HOUSE
Reuss
Smith, Nebr.
Van Deerlin
Rinaldo
Solarz
Vento
Roberts
Spellman
Volkmer
Robinson
Spence
Walgren
Roth
St Germain
Wampler
Roybal
Stack
Watkins
Runnels
Staggers
Weaver
Sabo
Steed
White
Santini
Stenholm
Whitehurst
Satterfield
Stewart
Williams, Mont.
Seiberling
Stockman
Wilson, Tex.
Sensenbrenner
Stratton
Wolff
Sharp
Studds
Wolpe
Shelby
Swift
Wright
Shumway
Synar
Wyatt
Simon
Tauke
Yatron
Skelton
Taylor
Young, Mo.
Slack
Thomas
Zablocki
Smith, Iowa
Trible
NAYS-5
Carney
Holt
Mitchell, Md.
Derwinski
McDonald
NOT VOTING-212
Addabbo
Fascell
Nedzi
Albosta
Fazio
Nelson
Alexander
Ferraro
Nolan
Anderson,
Fish
Nowak
Calif.
Flood
O'Brien
Andrews, N.C.
Ford, Mich.
Ottinger
Andrews,
Ford, Tenn.
Panetta
N. Dak.
Forsythe
Paehayan
Anthony
Frost
Patten
Applegate
Garcia
Patterson
Archer
Giaimo
Pepper
Ashbrook
Gibbons
Petri
Ashley
Gilman
Prayer
Aspin
Gingrich
Pursell
AuCoin
.
Glickman
Quayle
Badham
Goldwater
Quillen
Baldus
Goodling
Rahall
Beard, Tenn.
Gray
Railsback
Bellenson
Green
Regula
Boland
Grisham
Rhodes
Bolling
Gudger
Richmond
Boner
Hagedorn
Ritter
Breaux
Hall, Tex.
Rodino
Brinkley
Hammer-
Roe
Broomfleld
schmidt
Rose
Broyhill
Hanley
Rosenthal
Buchanan
Harsha
Rostenkowski
Burgener
Heckler
Rousselot
,.Burlison
Hefner
Royer
Burton, John
Heftel
Ruda
Burton, Phillip
Hillis
Russo
Butler
Holland
Sawyer
Byron
Hollenbeck
Scheuer
Campbell
Holtzman
Schroeder
Carr
Howard
Schulze
Cheney
Huckaby
Sebelius
Chisholm
Hughes
Shamnon
Clausen
Hutto'
Shuster
Clay
Jenkins
Snows
Cleveland
Johnson, Colo.
Snyder
Clinger
Kindness
Solomon
Coleman
LaFalce
Stangeland
Collins, Ill.
Latta
Stanton
Conte
Leach, La.
Stark
Conyers
Leath, Tex.
Stokes
Cotter
Lederer
Stump
Crane, Daniel
Lee
Symms
Crane, Philip
Lent
Thompson
D'Amours
Lloyd
Traxler
Daniel, Dan
Long, Md.
Treen
Danielson
Lott
Udall
Davis, Mich.
Luken
Ullman
Davis, S.C.
Lundine
Vander Jagt
Dellums
McDade
Vanik
Derrick
McEwen
Walker
Devine
McKay
Waxman
Dickinson
Madigan
Weiss
Dicks
Marks
Whitley
Diggs
Marriott
Whittaker
Dodd
Martin
Whitten
Dornan
Matsui
Williams. Ohio
Dougherty
Mattox
Wilson. Bob
Downey
Mavroules
Wilson, C. H.
Early
Michel
Winn
Eckhardt
Mikva
Wirth
Edwards, Ala.
Minish
Wydler
Edwards, Okla.
Moakley
Wylie
Emery
Moorhead, Pa.
Yates
Erlenborn
Mottl
Youne. Alaska
Evans, Del.
Murphy, nl.
Young, Fla.
Evans, Ga.
Murphy. N.Y.
Zeferetti
Fary
Myers, Pa.
^ 1450
So the motion was agreed to.
The result of the vote was announced
as above recorded.
IN THE COMMIT TEE OF THE WHOLE
Accordingly the House resolved itself'
into the Committee of the Whole House
on the State of the Union for the con-
sideration of the bill, H.R. 4034, with
Mr. SEIBERLING in the chair.
The Clerk read the title of the bill.
The CHAIRMAN. Pursuant to the rule,
the first reading of the bill is dispensed
with.
Under the rule, the gentleman from
New York (Mr. BINGHAM) will be recog-
nized for 30 minutes, and the gentleman
from California (Mr. LAGOMARSINO) will
be recognized for 30 minutes.
The Chair recognizes the gentleman
from New York (Mr. BINGHAMY.
Mr. BINGHAM. Mr. Chairman, I yield
myself 9 minutes.
(Mr. BINGHAM asked and was given
permission to revise and extend his re-
marks.)
Mr. BINGHAM. W. Chairman, H.R.
4034 is the product of a great deal of
consultation and mutual accommodation
with the executive branch and among
various individuals .and groups within
the Congress.
I want to express my appreciation for
the support of the chairman of the full
committee, the gentleman from Wiscon-
sin (Mr. ZABLOCKI), and the other mem-
bers of the committee, particularly the
members of the subcommittee who
worked very hard on this legislation..I
would particularly like to express my
appreciation to the ranking minority
member, my friend and colleague, the
gentleman from California (Mr. LAGO-
MARSINO), who offered many constructive
amendments to this legislation and who
devoted a great deal of time and atten-
tion to it. We have a better bill before
the House today because of his efforts
and willingness to resolve problems con-
structively.
The subcommittee received sugges-
tions and useful comments from many
public groups, and the subcommittee ap-
preciates the work of each of those or-
ganizations. In particular, however, I
would like to mention the helpful sug-
gestions and support we received from
the National Governors Association,
which took a very active interest in this
legislation. The association, I am happy
to say, strongly supports this legislation,
as do other groups which I will mention
later.
Mr. Chairman, this bill would accom-
plish the first maJor reform of the export
control system in 10 years-a reform
more of procedures than of policies. It
would extend the export control author-
ity, which would otherwise expire Sep-
tember 30 of this year, to September 30,
1983. The bill extends, without any
change whatsoever, the legislation ap-
proved by the Congress in 1977 restrict-
ing American participation in foreign
boycotts against countries friendly to the
United States. It also retains congres-
sional veto over any action by the execu-
tive branch to restrict the export of agri-
cultural commodities. It contains an
even tighter restriction than existing law
upon any export of Alaskan oil. Finally,
in title II, it authorizes funds for the
collection of foreign investment data
H 6405
under the Foreign Investment Survey
Act.
Perhaps the most important reform in
this bill is that for the first time a clear
distinction or separation is made be-
tween controls on U.S. exports for na-
tional security reasons and controls for
foreign policy reasons. The current stat-
ute, which evolved over the past 30
years, tended to confuse those two very
different kinds of controls. This has re-
sulted in frustrations and misunder-
standings in the American business com-
munity and has tended to discredit and
weaken the extire export control process.
Under this legislation, exporters will
know when they are dealing with foreign
policy controls and when they are fac-
ing possible controls for national se-
curity reasons. With the exception of
export of nuclear items, procedures for
which are contained in the Nuclear Non-
Proliferation Act, controls exercised un-
der this act will be clearly for foreign
policy or for national security purposes,
with greater constraints on the execu-
tive branch in restricting exports for
foreign policy than for national security
reasons.
The Subcommittee on International
Economic Policy and Trade, which I
have the honor to chair, has been study-
ing export administration since 1976.
The first result of that study was the
Export Administration Amendments of
1977, passed overwhelmingly by the
House. H.R. 4034 seeks to carry forward
the reforms begun with the 1977 amend-
ments. The bill is the product of 15 days
of hearings, at which witnesses of all
persuasions and opinions were heard,
and 8 days of markup in both the sub-
committee and the full Committee on
Foreign Affairs. It now carries the spon-
sorship, I am proud to say, of 15 of the
committee's 22 Democrats and 6 of the
committee's 12 Republicans.
Section 104 of the bill, which runs
from page 6 to page 40, is the heart of
it. While appearing complex, its two
purposes are simple. The first is to in-
crease the effectiveness of exports con-
trols by: clarifying the statutory au-
thority of the Defense Department; re-
quiring the development of a list of
"military critical technologies" for ex-
port control purposes; strengthening the
15-nation export control coordinating
system known as COCOM; improving
the monitoring of technology transfers
through technology cooperation agree-
ments; and requiring accountability in
the exercise of foreign policy controls.
The second is to remove obsolete con-
trols and to increase the efficiency of the
licensing procedures by: establishing
procedures for multiple exports of
routinely approved items with Just one
application; requiring greater attention
to foreign availability; encouraging
periodic removal of controls as goods
and technology become obsolete from a
national security point of view; requir-
ing more frequent and more open list
reviews; and imposing procedural, re-
quirements and time limits for proces-
sing export license applications in order
to reduce the long delays which fre-
quently occur under current practice,
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CONGRESSIONAL RECORD-HOUSE .. July 23, 1979
^ 1500
In the world in which we live, we can-
not afford to relax our controls on tech-
nology exports which our adversaries
could use to reduce the military tech-
nology gap which is the key to the su-
perior performance of U.S. weapons sys-
tems. At the same time, considering the
unprecedented trade deficit which is sap-
ping our economic strength and vitality,
we cannot afford to continue control-
Ing products which are being exported by
other advanced free-world countries.
Nor can we afford inefficiencies and de-
lays in the licensing system which act as
needless barriers to exports. I believe
H.R. 4034 makes the necessary trade-offs
between these considerations. I believe
it is a balanced bill.
Mr. Chairman, I will include a sum-
mary of the bill at the end of my re-
marks, and will not go into further de-
tail at this time. In conclusion, let me
touch on an important point at issue in
this bill. Recently there have been
charges that U.S. technology is flowing
freely to the Soviet Union and being di-
verted to the Soviet military. If you listen
carefully, you will not hear much evi-
dence to back up these charges, because.
they are wrong. The well-known fact is
that the United States has the most re-
strictive East-West technology transfer
policies of any Western nation, with the
result that the Soviets get most of their
imported technology from our allies.
But as the debate proceeds, I would ask
you to keep the following points in mind:
First, the law is very clear: exports
"which would make a significant contri-
bution to the miitary potiential of any
other nation or nations which would
prove detrimental to the national secu-
rity of the United States" are not per-
mitted. All agencies involved seek faith-
fully to implement that provision. It hap-
pens to be a fact that no technology ex-
port to a Communist country has taken
or can take place without the concur-
rence of DOD.
Second, technology-the knowledge of
how to product things-exists in people's
minds. There is no way you can stop its
transfer forever. Other countries have
it, too. The Soviets can develop their own,
or get it from other sources. Just because
the Soviets possess a capability does not
mean we gave it to them. Beware of alm
legations on this floor that because the
Soviets know how to do something, they
must have learned it from us.
Third, we will be talking here about
export controls on so-called dual-use
items-that is, items which are civilian
in character but, by their nature, can be
used to support "military activities. Be-
ware of the proposition that because an
item could conceivably be used for mili-
tary purposes, it should be banned from
export. Everything exported under this
act probably could be put to military
use for example--common tools, boots,
and so forth. The whole reason we have
a licensing system is to distinguish be-
tween those that can be. safely exported
and those that cannot.
The licensing process is run by human
beings. They are required by the law' to
make excruciatingly difficult judgments.
I am not going to stand before you and
say they have never made a mistake in
the 30 years that the licensing system
has been in operation. But what I want
to impress upon you is that the only way
to avoid mistakes is to remove discretion
by banning all exports. Since no other
country is prepared to do this, it would
solve nothing. There is no way to get
around the necessity for judgment. In
this situation, we have a licensing system
that errs on the side of caution, as it
should. But those who will suggest to
you that with organizational tinkering
they can remove all risk are claiming the
impossible.
Mr. Chairman, the United States ex-
ports only 8 percent of its gross national
product-compared with 27 percent for
Germany and 14 percent for Japan. We
have only 13 percent of the West's tech-
nology exports to the Soviets; last year,
we had only 1 percent of the machine
tool exports. We are not exporting our
technology to the East; we are exporting
our jobs to our competitors. We bring
before you a bill which responds respon-
sibility to this problem, fully protecting
the national security while increasing
U.S. competitiveness in the international
marketplace.
I am proud that the bill is endorsed
by the National Governors Association,
the U.S. Chamber of Commerce, the Na-
tional Association of Manufacturers, the
Emergency Committee for American
Trade, the American League for Exports
and Security Assistance-chaired by our
former colleague, Joe Karth-and by
six major advanced technology industry
associations. I am honored that the bill
is supported in a recent "Dear Colleague"
by the ranking member of the Appro-
priations Committee (Mr. CONTE), the
minority whip (Mr. MICHEL), the chair-
man of the Congressional Campaign
Committee (Mr. VANDER JAGT), the chief
deputy majority whip (Mr. ROSTENKOW-
sxI), and the chairman of the Export
Task Force (Mr. ALEXANDER), and in
another "Dear Colleague" by Northeast-
Midwest Coalition chaired by the gen-
tleman from Pennsylvania (Mr. EDGAR).
The bill is also consistent with the rec-
ommendations of two major GAO re-
ports. I believe it is a good bill, and
worthy of your support. I urge you to
vote for the bill and against any re-
strictive amendments.
In closing, let me address some par-
ticular issues that have arisen. Much
has been made recently of the fact that
some end products of the Kama River
truck factory in the Soviet Union, which
includes some of our technology, are be-
ing used by the Soviet military. Those
end products are common diesel engines
and general purpose trucks.
What Kama River illustrates is that
U.S: export control policy tolerates some
military use of commonly available end
products produced from U.S.-origin tech-
nology. That was our policy in 1971 when
the Kama River decisions were made. It
has been our policy since President Nixon
implemented detente and the Congress
accordingly amended the Export Ad-
ministration Act in 1969. It is our policy
today. This legislation (H.R. 4034) does
not change that policy. ??
Now the Members who are making an
issue of Kama River disagree with that
policy. That is certainly their right and
privilege. But it is unfair, however, to
portray Kama River as evidence that
the export licensing system does not
work. The system worked perfectly well.
We knew precisely what we were do-
ing-we took into account all the risks
and factors..In short, Kama River is
a policy disagreement, not an indict-
ment of the export licensing mechanism..
While it is our policy to tolerate some
military use of easily available end prod-
ucts-such as general purpose trucks,
which the Soviet Union has long pro-
duced itself or could get from any
COCOM country-we, of course, do not
tolerate direct military use of advanced
technology. We weigh the risk of such
direct military use for every export of
advanced technology, and deny many
where the risk is simly too great, regard.
less of any end-use or safeguard agree-
ments we might be able to get from the
Soviets. We do not ship anything under
safeguard agreements where the conse-
quences would be great if the safeguards
were violated and diversion occurred.
About the only alternative to this kind
of policy, Mr. Chairman is to go back to
the total embargo we had during the cold
war and up until 1969. If we did not tol-
erate some military use of common end
products we would not sell wheat, or
shoes, or even buttons to the Soviets-
some of which can be, and probably are,
used directly or indirectly by the Soviet
military. That, in essence, is what the
critics of our decision of Kama River,
would like to do-go back to the total
embargo of the cold war. The Congress
and a Republican President abandoned
that approach in 1969. I urge my col-
leagues not to revert to the cold war
now--to reject amendments based upon
allegations that our export control mech-
anism does not work and purporting
to fix up the system by putting it in DOD
or increasing the scope of the controls.
Another issue which has been the sub-
ject of much discussion lately is the so-
called critical technology issue. Tech-
nology is defined as the know-how used
to design and manufacture products.
Since 1976, DOD has been engaged in an
effort to develop ?a list of military crit-
ical technologies which we want to
take special care to control because they
are the keys to the technological super-
iority of U.S. weapons systems. If these
critical ,technologies can be identified, it
should be possible to decontrol a signifi-
cant number of end products whose ex-
port-in the absence of the knowledge of
how to make them-would not pose a na-
tional security threat. This would permit
our export control personnel to focus
their attention better on the more signif-
icant items. and would facilitate exports
on noncritical items. H.R. 4034 en-
courages this outcome.
The critical technology exercise is fre-
quently misinterpreted in popular dis-
cussion as indicating that critical tech-
nologies are not now controlled-that
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July 29, 1979 CONGRESSIONAL RECORD-HOUSE
they are flowing freely to the Soviets
until the exercise is completed and they
are brought under control. This is not
the case. Critical technology is con-
trolled and always has been. But it has
been controlled on a case-by-case basis,
along with non-critical technology and
end products. Judgments are made on
each individual application, without ref-
erence to a list of what is most critical.
It is desirable for this situation to
change, and H.R. 4034 encourages a
change. But we should not proceed in a
panic, on the assumption that critical
technology will be exported until con-
trolled.
This panic is the basis for proposals
that we require in the law that the criti-
cal technologies list be published imme-
diately and that items on the list be ab-
solutely banned for export to communist
countries. Such action would be grossly
premature. We do not yet know whether
it will prove possible to elaborate a list
of technologies we never want to export
to the Soviets, let alone what such a list
would look like. The current case-by-
case method must continue in operation
until our knowledge advances far enough
to adopt a better system. Meanwhile, we
can rest assured that critical technolog-
ies are being controlled.
A final issue that has arisen concerns
the role of the Department of Defense in
determining what is to be controlled on
national security grounds and in reach-
ing licensing determinations on those
items. Some would have us believe that
an export-oriented Commerce Depart-
ment is shipping our technology to the
communists by the boatload over the ob-
jections of the Department of Defense.
These people want to put DOD in charge
of export controls, on the assumption
that DOD would be, more conservative
than Commerce and many exports would
be halted.
That assumption would be correct ex-
cept for one minor detail: DOD already
exercises primary influence over the na-
tional security control list, and already
has a veto over exports to Communist
countries. In 1974 the so-called Jackson
amendment was inserted into the Ex-
port Administration Act, enabling DOD
to review any license application and to
recommend denial directly to the Presi-
dent. Since that time, DOD has never
been overruled.
It is true, as a general rule, DOD takes
a more conservative view of exports to
the East than does the Commerce De-
partment. Export licensing Is deliber-
ately an interagency process, so a
variety of viewpoints will be brought
to bear on the applications. But DOD's
role-both by statute and because of the
natural deference accorded it by the
other agencies in national security mat-
ters-is such that whenever DOD voices
a national security objection to a pro-
posed export, that export is halted un-
less and until DOD is satisfied.
Mr. Chairman, DOD has testified on
numerous occasions that it is fully satis-
fied with its current role in the export
control process. I append to my state-
ment letters from Secretary of Com-
mencer Kreps and Under Secretary
of Defense Duncan stating that they
favor the current division of responsi-
bilities between the two agencies and do
not seek any changes.,
Mr. Chairman, I am proud that the
bill is endorsed by the National Gover-
nors' Association, the U.S. Chamber of
Commerce, the National Association of
-Manufacturers, the Emergency Com-
mittee for American Trade, the Amer-
ican League for Exports and Security
Assistance, chaired by our former col-
league, Joe Karth, and by six major
advanced technology industry associa-
tions. I am honored that the bill is sup-
ported in a recent "Dear Colleague".
letter by: the ranking minority member
of the Appropriations Committee, the
gentleman from Massachusetts (Mr.
CONTE) ; the minority whip, the gentle-
man from Illinois (Mr. MICHEL) ; the
chairman of the Congressional Cam-
paign Committee, the gentleman from
Michigan (Mr. VANDER JAGT) ; the chief
deputy majority whip, the gentleman
from Illinois (Mr. ROSTENKOWSKI) ; and
the chairman of the Export Task Force,
the gentleman from Arkansas (Mr.
ALEXANDER) ; and in another "Dear Col-
league" letter by Northeast-Midwest
Coalition, chaired by the gentleman
from Pennsylvania (Mr. EDGAR). The bill
is also consistent with the recommenda-
tion of two major GAO reports. I believe
it is a good bill and worthy of your sup-
port. I urge you to vote for the bill
against any restrictive amendments.
$VMM I OF MAJOR PROVVsIONS OF THE EXPORT
ADMINISTRATION AMENDMENTS OF 97
Section 102 revises the findings of the Ex-
port Administration Act to emphasize the
importance of exports for the U.S. economy
and the effect on the U.S. trading position of
the availability of competing goods and tech-
nology from foreign sources, while maintain-
ing the finding In the Act of the continuing
need to restrict exports for national security
and other purposes.
Section 103 restates the three basic pur-
poses of the Act in order of their importance,
and adds two new policy statements to sec-
tion 3 of the Act: that it is U.S. policy to ap-
ply export controls in cooperation with U.S.
allies; and that exports are a high priority
and should not be controlled except when the
controls are essential, will clearly achieve
their objectives, are administered according
to basic standards of due process, and are
justified annually to Congress and the public.
Section 104 adds four new sections to the
Act, numbered 4, 5, 6, and 10.
New section 4 establishes validated and
general export licenses, currently in use, in
the law, and establishes a new kind of export
license, a "qualified general license," which
would authorize multiple exports of certain
goods and technology, subject to appropriate
end-use controls and other conditions, with-
out individual application for each transac-
tion. The purpose of this provision is to pro-
vide administratively simpler licensing pro-
cedures for routinely approved exports,
thereby reducing the paperwork and delays
associated with validated license applica-
tions..
New section 5 consolidates the existing
national security control authorities of the
Act into a single section and makes several
reforms in the ' exercise of those controls,
among them the following. The Secretary of
Defense is specifically authorized to identify
goods and technology to be controlled for na-
tional security, purposes. There is to be con-
tinuous review of the list of items con-
H 6407
trolled for national security purposes, prompt
issuance of revisions to the list, and oppor-
tunity for interested parties to suomit their
views. The Secretary of Defense is required to
develop a list of military critical technologies
for use for export'control purposes. The Sec-
retary of Commerce is to limit validated li-
cense controls insofar as practicable to cer-
tain stated situations, and to employ quali-
fied general license procedures to the max-
imum extent practicable. The Secretary of
Commerce is required to establish a capabil-
ity within the Commerce Department for the
continuous review of foreign availability,
and to remove validated license controls on,
and approve applications for the export of,
goods and technology with respect to which
foreign availability has been established, un-
less the President determines that such
action would be detrimental to the national
security, in which case the Secretary must
publish that determination along with a
statement of its basic and estimated eco-
nomic impact. The Secretary is encouraged to
establish an "indexing" system providing for
periodic removal of controls as goods and
technology become obsolete from a national
security point of view. The Secretary of Com-
merce is required to investigate certifications
of foreign availability made by the industry-
government Technical Advisory Committees
established under the Act, and to remove
controls where such availabiilty is deter-
mined to exist. The President is required to
enter into negotiations with a view toward
Improving the effectiveness of the 15-nation
export control Coordinating Committee
(COCOM). U.S. organizations (except educa-
tional institutions) entering into certain
technical cooperation agreements with gov-
ernment agencies in controlled countries are
required to report those agreements to the
Secretary of Commerce, in order to facilitate
monitoring of technology transfers which
might take place under such agreements.
New section 6 consolidates the existing
foreign policy control authorities of the Act
into a single section and makes several re-
forms in the exercise of those controls,
among them the following. Before imposing
such controls, the President is required to
consider their likely effectiveness, their com-
patability with U.S. foreign policy objectives
and with overall U.S. policy toward the
country which is the target of the controls,
their likely effects on U.S. export perform-
ance and international competitiveness and
on U.S. companies and their employees and
communities, and the government's ability
to enforce the controls effectively. Before
imposing such controls, the Secretary of
Commerce is required to consult with
affected U.S. industries, and the President is
required to determine that reasonable efforts
have been made to achieve the purpose of
the controls through negotiation or other
means. The President 1s required to consult
with Congress before imposing foreign policy
controls and to report the imposition of any
new control to Congress, and Congress can
disapprove the control by Concurrent Reso-
lution. Controls imposed pursuant to trea-
ties or other international obligations are
exempted from several of the requirements
of this section.
New section 10 provides procedural re-
quirements for processing export license ap-
plications, in order to reduce the long delays
which frequently occur under current prac-
tice. Although the Intent of Congress is
stated that licensing determinations should
be made to the maximum extent possible
by the Secretary of Commerce without
interagency review, it is provided that any
agency may review any license application if
it so requests.
An overall maximum of 180 days is pro-
vided for U.S. government review of appli-
cations, as follows. Within 30 days, the
Commerce Department is to either approve
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CONGRESSIONAL RECORD-HOUSE July 23, 1979,
or deny an application, or refer it to other
agencies for review. The other agencies are
to submit their recommendations to the
Commerce Department Within 30 days or be
deemed to have no objection to approval,
unless the head of any such agency re-
quests more time, in which case a further
30 days is provided. The Commerce Depart-
ment then has 30 days to consider the
agency recommendations, reach a decision,
and issue or deny the license. Any agency
which submitted recommendations to the
Commerce Department may appeal the De-
partment's decision to the Secretary of
Commerce, in which case the Secretary has
30 days to consider the appeal, reach a de-
cision, and issue or deny the license. Any
agency which appealed to the Secretary may
appeal the Secretary's decision to the Presi-
dent, in which case the President has 30
days to consider the appeal and reach a
decision, or else the decision of the Secre-
tary is final.
Apart from these procedures, special na-
tional security procedures, currently pro-
vided in the Act and retained in the bill,
provide that the Secretary of Defense may,
within 30 days, recommend denial of any
application directly to the President, in
which case the President has 30 days to
sustain or overrule the recommendation.
After. U.S. government review is com-
pleted, 60 days are provided for COCOM re-
view if necessary; in the absence of COCOM
action within the 60-day limit, the license is
required to be issued. A comparable 60-day
period is provided for U.S. review of export
requests by other COCOM members.
With notification to Congress and the ap-
plicant, any time period prescribed by this
section may be extended in order to permit
negotiations on possible modification of an
application to meet national security ob-
jections.
An applicant may appeal any license de-
nial to the Secretary of Commerce. In any
case where any time limit is violated, the
applicant may petition the Secretary of
Commerce to correct the situation and, if
the processing of the application has not
been brought into conformity with the re-
quirements of this section within 30 days,
may bring an action in United States dis-
trict court to require compliance with such
requirements. At all stages of the process,
the applicant is to be kept fully informed
to the status of his application. The appli-
cant is to be accorded an opportunity to re-
spond to objections to his application, and
is to be informed of the reasons for any de-
nial.
Section 105 provides that one of the fac-
tors on the basis of which export licenses
are to be allocated in the case of export
controls for short supply purposes is the ex-
tent to which a country engages in equita-
ble trade practices with respect to United
States goods and treats the United States
equitably in times of short supply.
Section 106 strengthens the short supply
monitoring provisions of the Act.
Section 107 strengthens the prohibitions
of the Act on the export of Alaskan oil, and
provides an exemption from these prohibi-
tions in order to fulfill a bilateral interna-
tional oil supply agreement entered into by
the U.S. prior to May 1, 1979. The only
such agreement in effect on that date was
between the U.S. and Israel.
Section 108 repeals the prohibition in the
Act on exports to Uganda.
Section 109 facilitates barter arrange-
ments whereby goods in excess supply in
the domestic economy are exchanged for
goods in short supply.
Section 110 phases out exports of un-
processed western red cedar logs, a vanish.
ing species, over a four-year period.
Section 111 provides that any product
which is standard FAA-certified equipment
in civil aircraft and is an integral part of
such aircraft, and which is to be exported to
a noncommunist country, shall be subject
to controls under the Export Administration
Act rather than the Arms Export Control
Act.
Section 112 exempts certain export con-
trols for nuclear nonproliferation purposes
from certain of the requirements of the bill.
In essence, controls and procedures current-
ly in effect are "grandfathered" in order to
avoid any possible disruption of the con-
trols.
Section 113 increases the penalties for
violations of the Act.
Section 114 amends the confidentiality
provisions in section 7(c) of the Act to re-
quire the Secretary, with certain exceptions,
to maintain the confidentiality of informa-
tion which would reveal the parties to a
transaction, the type of good or technology
being exported, or the destination, end use,
quantity, value, or price of the good or tech-
nology.
Section 119 authorizes the appropriation
of $7,070,000 for fiscal year 1980 and $7,777,-
000 for fiscal year 1981 to the Department-of
Commerce to carry out the Act.
Section 120 extends the authority granted
by the Act to September 30, 1983.
Section 201 authorizes $4,400,000 for fiscal
year 1980, and $4,500,000 for fiscal year 1981.
to carry out the International Survey Act.
Other sections are more or less technical
in nature.
THE SECRETARY OF COMMERCE,
Washington, D.C., July 23, 1979.
Hon. JONATHAN B. BINGHAM,
Chairman, Subcommittee on International
Economic Policy and Trade, Committee
on Foreign Affairs, House of Representa-
tives, Washington, D.C.
DEAR MR. CHAIRMAN: When H.R. 4034 is
considered on the House floor, it is antici-
pated that a number of amendments may be
offered. I am authorized to say that the Ad-
ministration is opposed to any amendment
which would alter the existing array of re-
sponsibilities within the Executive Branch
with respect to the administration of export
controls, and we prefer that there be no ad-
ditional restrictions on export controls.
Sincerely,
JUANITA M. KREPS,
Secretary of Commerce.
THE DEPUTY SECRETARY OF DEFENSE
Washington, D.C., July 20, 1979.
Sen. ADLAI E. STEVENSON,
U.S. Senate,
Washington, D.C.
DEAR SENATOR STEVENSON: In response to
your letter of July 19, 1979, the Department
of Defense supports the administration's
position on the amendments which are ex-
pected to be offered to S. 737, the Export
Administration Act of 1979.
Most of these proposals do not impact di-
rectly on the Department of Defense. Two,
however, do and we are opposed to both of
them. One would tend to reverse the relative
roles of the Secretary of Defense and Secre-
tary of Commerce in reviewing and revising
export controls maintained for national
security purposes. While the intent appears
to be to insure that the Department of De-
fense has an adequate role in the export
control system, it is our judgment that the
Secretary of Defense already has and exer-
cises adequate authority in this area.
The other amendment would authorize in-
clusion in the Defense budget of funds espe-
cially appropriated for export control func-
tions. Our opposition to this proposal is that
such an authorization is not currently
needed
By means of a separate letter, I plan to
answer the other questions you raised about
the adequacy of U.S. export controls main-
tained for national security purposes. In the
meantime, I thought it might be helpful to
let you know at once where we stand on the
amendments issue.
ASSISTANT SECRETARY OF DEFENSE,
Washington, D.C., July 20,1979.
Hon. ADLAI E. STEVENSON III,
U.S. Senate,
Washington, D.C.
DEAR SENATOR STEVENSON: We have re-
viewed your 19 July 1979 letter in which you
requested Department of Defense views on
several amendments which are expected to
be offered to S. 37. Our views on the questions
raised in your numbered paragraphs are as
follows:
1. The Kama River Truck Plant licenses
for the foundry and production machinery
were issued during the Nixon Administra-
tion and contained no restrictions so far as
we know limiting the use of the trucks and
engines produced in the factory. Accordingly,
use by the Soviet military of the trucks pro-
duced at Kama or inclusion of the engines in
military vehicles would not constitute a vio-
lation of U.S. export control restrictions.
Whether and if so to what extent Kama River
engines are being used in Soviet military
vehicles has not been verified. Accordingly,
there is no basis on which a judgment can be
made about the contribution such use might
make to the Soviet military potential.
2. A number of technologies employed in
the Cruise Missile System can be exported to
most non-Communist countries without a
validated export license. None of them, how-
ever, are either sensitive or "critical" be-
cause they are not unique to cruise missile
design, development or production and are
readily available in a number of countries in
the West. Those few technologies which are
both unique to cruise missiles and available
only in the U.S. require validated licenses
from either the Departments of State or
Commerce. An example is the technology as-
sociated with the small jet engine which is
currently under development for the cruise
missile. This technology can only be exported
under a Munitions license.
3. The existing allocation of responsibility
under the Export Administration Act for ex-
port controls does not hinder the Depart-
ment of Defense's efforts to formulate a
list of critical military technologies or
otherwise interfere with the implementation
of an effective and fully adequate system
of export controls for national security pur-
poses. In particular, the Department of
Defense would oppose any amendment which
tend to reverse the relative roles of the
Secretary of Defense and the Secretary of
Commerce in reviewing and revising export
controls maintained for national security
purposes. It is our judgment that the Secre-
tary of Defense already has and exercises
adequate authority in this area.
4. Statutory authority is already available
to embargo exports of "critical" goods and
technologies to all controlled country des-
tinations. We would oppose any amendment
which would make this a mandatory re-
auirement because, on the one hand, the
items to be covered are not presently fully
determined, and, on the other hand, there
may be occasions, even though rare, on
which such action would be ill-advised.
With regard to end use statements and
safeguard provisions, we do not regard them
as applicable to transactions in which tech-
nology, either in the form of technical data
or equipment from which technology may
be extracted, is involved. It is our judgment
that technology once transferred can be
neither controlled or recalled. We consider
the usefulness of safeguards as limited to
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hardware items whose diversion to other
than their stated purpose we wish to deter.
We do not count end use statements as a
safeguard.
As for computers, there are some applica-
tions for which we have been unable to
devise technically and economically feasi-
ble safeguards. These are automatically
recommended for denial. For others, ex-
perienced USO technical and intelligence
experts have determined that safeguard
provisions, judiciously applied, provide s
reasonable assurance of detecting and thus
deterring significant diversion of the sys-
tem from its stated end use.
S. The Department of Defense has no
evidence that Moscow has used American
seismic equipment to enhance its anti-
submarine warfare potential or that Amer-
ican machine tools for producing precision
ball-bearings have probably helped Soviet
engineers to develop multiple warheads for
new intercontinental missiles.
I trust this is the information you desire.
Sincerely,
THE SECRETARY OF COMMERCE,
Washington, D.C., June 18, 1979.
Hon. JONATHAN B. BINGHAM.
Chairman, Subcommittee on International
Economic Policy and Trade, Committee
on Foreign Affairs, House of Represent-
atives, Washington, D.C.
DEAR MR. CHAIRMAN: In the course of testi-
mony before the Subcommittee on Research
and Development of the House Committee on
Armed Services, the Deputy Director of the
Office of Export Administration, Lawrence J.
Brady, testified that trucks produced at the
Kama River truck factory in the Soviet Un-
ion were being "diverted" to military use in
violation of U.S. export control restrictions.
That testimony has led to newspaper
stories implying that Soviet military capa-
bility has been helped as a result of an ap-
parent lack of vigilance by this Department.
This is in error.
As you know, our nation no longer enjoys
a favorable balance of trade, and thus the
promotion of exports is more important than
ever before. Even so, the national security
is paramount, and we must be careful that
we do not export materials and technology
that would advance at our own expense the
military capabilities of other nations. To
walk this line is a difficult and delicate job.
That is why it is essential that issues which
may arise be discussed on the basis of ac-
curate information.
First, there was no "diversion" in connec-
tion with the Kama River truck factory and,
therefore, no violation of U.S. export controls.
A diversion occurs only when end-use re-
strictions pertaining to a license are vio-
lated. The Kama River truck plant licenses
were issued during the Nixon Administration
and contained no restrictiong which we can
identify limiting the use of the trucks and
engines produced at the factory. Accordingly,
military use of the trucks or engines pro-
duced at Kama River would not constitute
a diversion or violation of the law because
the licenses contained no restrictions per-
taining to the use of those trucks or engines.
Nor would any military use of Kama River
trucks or engines entail diversion of the
foundry's computer, because limitations on
the use of the computer pertained to use of
its computing capacity, not to use of products
manufactured at the foundry. Several of the
licenses contain technical conditions which
have nothing to do with limitations on the
use of the factory output.-
This view is confirmed by the attached
memorandum from Mr. Brady which con-
cludes that a thorough review, which was re-
quested by Senior Deputy Assistant Secretary
Stanley J. Marcuss, has failed to disclose the
existence of any document which could be
construed as a limitation on the use of the
factory output for civilian as contrasted with
military purposes. Two exceptions mentioned
in the memorandum are not relevant to the
Kama River, plant.
Second, at the time the licenses were is-
sued, the Nixon Administration knew of the
possibility that Kama trucks or engines could
be used by the Soviet military. This factor
apparently was fully considered before the
decision was made. Thus it cannot be said
that this matter was overlooked or that the
export control system failed to ensure that all
relevant factors were considered.
Finally, contrary to some press reports, Mr.
Brady has not been "demoted" nor has any
action been taken against him. He retains
his position as Deputy Director of the Office
of Export Administration, a position he has
held for the last five years. Because of his
position as Deputy Director, Mr. Brady
served as Acting Director of the Office of Ex-
port Administration in the period between
the retirement of the previous director and
the appointment of the new one.
I hope this will lay to rest the misinforma-
tion which has recently surrounded this sub-
ject.
Sincerely,
Enclosure.
JUANITA M. KREPS,
Secretary of Commerce.
U.S. DEPARTMENT OF COMMERCE,
Washington, D.C., June 22, 1979.
Memorandum for Robin B. -Schwartzman,
Deputy Director, Bureau of Trade Regu-
lation.
From: Lawrence J. Brady, Deputy Director,
Office of Export Administration.
Subject: Kama River Case File.
On June 22, 1979, pursuant to your re-
quest, I thoroughly reviewed the relevant ex-
port license applications and supporting doc-
uments submitted by various U.S. firms seek-
ing Department of Commerce authorization
to export commodities to the USSR's Kama
River Project". The results of this examina-
tion, with two exceptions, failed to disclose
the existence of any document which could
be construed to represent an agreement be-
tween parties or assurances as to the specific
application of products, i.e., military vs. ci-
vilian, in the truck manufacturing process.
The exceptions are found in license appli-
cations case numbers 813124 and 849801. Case
number 849801 contains a "letter of proto-
col" between Mack Trucks, Inc., and a Soviet
trade delegation indicating that the trucks.
assembled at Kama River would be used for
agricultural and industrial purposes.
A copy of the protocol is attached
With regard to the protocol. I am con-
cerned that because Mack Truck pulled out
of the deal after signing the protocol, which
you will note also included other parties. in-
cluding SATRA, it may not be considered
relevant to subsequent licensing actions. I
intend to go through all of the license appli-
cations to see whether or not we referenced
the protocol in subsequent license actions. I
think we did. I am also sending you sepa-
rately a copy of the entire "front office" file
on KAMA.
Also attached is a June 14 memorandum
Dick Isadore prepared on the basis of a quick
review of all license applications for the
KAMA River plant.
U.S. DEPARTMENT OF COMMERCE,
Washington, D.C., June 14, 1979.
Memorandum for Lawrence Brady.
Subject: Kama River Truck Plant Licenses.
At your request all case files which could
be identified as part of the Kama River Truck
complex have been retrieved from Archives.
Staff members reviewed each case file, ex-
amining all documents including actual ap-
plications, supporting documents, Single
Transaction Statements, internal memoranda
and chron sheets for any indication which
would show;
H 6409
1. Limittaion on the truck usage for civilian
versus military applications.
2. Conditions attached to individual li-
censes.
3. Letters of conditions attached to licenses.
Over 175 case files were reviewed and there
was no indication of limitation of use for the
trucks to be produced at Kama River. The
computer equipment licenses issued to IBM
have the visitation conditions which are a
part of all major computer sales to Bloc
countries.
At the time these licenses were issued, they
were microfilmed and sent to Archives. The
procedure did not include microfilming let-
ters or supporting documents accompanying
licenses as is done now in our microfiching
process. We are retrieving these microfilm
files and will review the face of all licenses
issued to insure that conditions were not
typed on the license itself.
All cases and the Capital Goods & Produc-
tion Materials Kama River file have been
given to Paige Bryan.
RICHARD ISADORE.
Mr. SMITH of Iowa. Mr. Chairman,
will the gentleman yield?
Mr. BINGHAM. I yield to the gentle-
man from Iowa.
Mr. SMITH of Iowa. I thank the gen-
tleman for yielding.
Mr. Chairman, I want to compliment
the gentleman from New York (Mr.
BINGHAM) and also the ranking minority
member, the gentleman from California
(Mr. LA(OMARSINO). I think there is no
question that this subcommittee has,
since it has had jurisdiction of this par-
ticular subject matter, been very diligent
and worked very hard on this subject
matter.
I happen to have been one of those who
helped to reorganize the rules of the
House so that the gentleman's subcom-
mittee would get it rather than the sub-
committee that used to have it.
.I happen to have very strong opinions,
mostly against export controls; but I rec-
ognize that in' certain circumstances
there must be some kind of limitations,
especially as to certain strategic mate-
rials. But I especially want to thank the
gentleman and the ranking minority
member for looking favorably at a pro-
vision in here with regard to bartering.
Under existing law, it is not possible
to enter into a long-term barter agree-
ment with another country because it
would be subject to an export control
mechanism, and under this provision it
is permitted if it can be done to barter.
I think we have to recognize that we have
to do some of the things that Japan,
West Germany, and some of the other
countries do with regard to bartering.
I appreciate the gentleman putting this
into the bill.
Mr. BINGHAM. Mr. Chairman, I thank
the gentleman from Iowa (Mr. SMITH)
for his comments and for his role in giv-
ing our committee Jurisdiction. of this
subject matter. I also want to thank him
for his suggestion of this amendment,
which I think was a constructive addi-
tion to the bill.
Mr. LAGOMARSINO. Mr. Chairman,
I yield myself such time as I may con-
sume.
(Mr. LAGOMARSINO asked and was
given permission to revise and extend his
remarks.)
Mr. LAGOMARSINO. Mr. Chairman,
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I rise in support of H.R. 4034. I also wish
to call attention to several minor con-
cerns I have with the bill which I hope
can be worked out during floor consider-
ation of this measure.
First I want to commend Congress-
man BINCHAM, Chairman of the Sub-
committee on International Economic
Policy and Trade, and his staff and the
other members of the committee for
holding long, extensive, and very com-
prehensive hearings, and also for being
very patient throughout the markup
process In subcommittee, when I offered
some 25 amendments. Some of the
amendments were accepted then and
others were accepted later in full com-
mittee. We may even see again here in
the House a few of those not accepted
earlier. I want to also commend the mi-
nority staff, Jake Dunman for his out-
standing work on this measure.
I share the chairman's concern about
trying to enact legislation that will pro-
vide a proper balance between the inter-
ests of business and the interests of na-
tional security. The business sector needs
to lnlow what it must deal with in getting
an export license and in having some
way of knowing when a license will be
acted upon. On the other hand, we have
to balance that against the proper role
of national security and the need to pre-
vent technological information from fall-
ing into the hands of our adversaries
that could be harmful to our national
interest.
These days in the Foreign Affairs Com-
mittee we hear a lot about signals. Some-
body talks about sending a signal to
someone. I have been concerned that if
we are not very careful about how we
finally draft this bill, we might send a
signal, to whomever, is receiving it, that
would indicate that perhaps we are not
as interested in preventing substantial
and important technological information
from falling into the hands of our ad-
versaries as we should be. This could not
only help those adversaries by the re-
sulting situation here but also by giving
to our allies the impression that we are
not as concerned about what they per-
mit to be exported.
There was an article recently in the
Washington Post by George Will-I
would like to read a little to you. I do not
subscribe to everything he says, but II
think some of the points he makes are
worth considering.
He says:
Trade, especially the transfer of U.S. tech-
nology, is vital to the Soviet economy, which
must support a ravenous military machine.
The Soviet workforce is larger than that of
,the United States, but produces about half
the GNP. It would be even less productive
without technology supplied by capitalist
countries.
As Carl Gershman writes in commentary,
it is hard to find any important Soviet in-
dustrial process that has not benefited sig-
nificantly from western technology. Soviet
gains from such transfers, are immediate
and economic-which. In a garrison state,
means military, too. U.S. gains are hypo-
thetical.
A U.S. computer firm admits that the
Soviets gained 15 years in research by spend-
ing just $3 million. The Soviets bought for
just $150,000 space suits that American tax-
payers spend $20 million apiece to develop.
After a Soviet "trade" delegation. osten-
sibly considering purchases, toured Boeing,
Lockheed and McDonnell Douglas plants, a
member of the delegation admitted privately
that no purchase had ever been contem-
plated. The aim was Industrial espionage.
Some members' shoes had heels and soles
made of a substance that picked up metal
filings which could be returned to Moscow
for metallurgical analysis to reveal the alloys
used in U.B. aircraft.
I think that just having the hearings
we did-especially the way the hearings
were held over a substantial period of
time-allowed everyone plenty of time to
know what other witnesses were saying
and to respond. That has been helpful in
and of itself.
I think all of the executive agencies
that were involved with this process-
Departments of Commerce and Defense
particularly-are much more aware now
of the interests of members of our com-
mittee and of Congress as a whole and
are going to be more responsive. I think
our interest is shown by those hearings
and it will be shown by the work that
we finally produce here on the floor.
Of the changes I would like to see in
H.R. 4034, there are three of primary
concern to me: First. the provision elim-
inating U.S. re-export licensing require-
ments; second, mandatory suspense
dates for export license applications
within the administration review; and
third, mandatory dates for Cocom re-
view.
I would like to say that with regard
to the foreign policy provisions in. the
bill, I find very little to criticize. I think
the bill makes a substantial improvement
in the existing law in that area and will
really get rid of some of the uncertainty
in the business community. Specifically,
the, provision for congressional review of
Presidential decisions will provide a role
for Congress in this important subject.
In the area of national security con-
trols, I would like to summarize the em-
phasis we have given to this issue in
H.R. 4034.
The "findings" and "policy" sections
clarify the necessity of export controls
for national security purposes.
Included in the section on national
security controls is the provision for the
Secretary of Defense and other appro-
priate agencies to identify goods and
technology to be Included on the com-
modity control list. The Secretaries of
Commerce and Defense must concur on
items to be included on the list, and in
case of a dispute between the two, the
matter shall be referred to the President
for resolution.
This section of the bill also provides.
for the Secretary of Defense to develop
a list of military critical technologies and
finds that the national interest requires
that export controls for national secu-
rity purposes be focused primarily on
military critical technologies. In devel-
oping such a list, the Secretary of De-
fense is to give primary attention to the
elements DOD cites as essential to pre-
serving the U.S. technological lead. The
technologies are to be controlled when
they are not possessed by countries to
which exports are controlled and which,
if exported, would permit ?a major ad-
vance in a weapons system of any such
country. The list of military critical tech-
nologies developed by the Secretary of
Defense is to become part of the com-
modity control list according to the
procedures set forth in the bill. This is
an essential provision.
The provisions of the bill for a vali-
dated license and a new category the
qualfied general license-were revised to
make more explicit that national secu-
rity concerns must be considered in re-
quiring such licenses.
As a result of my amendment in sub-
committee, the bill now provides for the
President to require a validated license,
even in the case of foreign availability; if
he determines that the absence of such
controls would be detrimental to the na-
tional security of the United States. An-
other provision was added in full com-
mittee requiring the President to publish
the reason and the estimated economic
impact.of such a decision.
The role of technical advisory com-
mittees is made more explicit with re-
spect to their functions in assisting the
Secretary of Defense in decisions related
to national security controls.
The section on national security con-
trols also provides for the Secretary of
State, in consultation with the Secre-
taries of Defense and Commerce, to be
responsible for conducting negotiations
with other countries to seek their coop-
eration in restricting the export of goods
and technology for national security
purposes.
Another amendment, which I spon-
sored in subcommittee, was accepted in
the bill providing for special procedures
for the Secretary of Defense. By this
section, the Secretary of Defense is au-
thorized to review any proposed export
of any goods or technology to any coun-
try to which exports are controlled for
national security purposes. Whenever he
determines that the export of such
goods or technology will make a signifi-
cant contribution to the military poten-
tial of any such country, which would
prove detrimental to the national securi-
ty of the United States, the Secretary of
Defense is authorized to recommend to
the President that such export be dis-
approved. If the President confirms that
recommendation, no license may be
issued for the export of such goods or
technology.
The bill also meets a major concern of
industry through an amendment I
offered by providing for confidentiality
of information required to be furnished
under this act. It also provides for ac-
cess by Congress to any, information re-
quired at any time under this or any
previous act pertaining to export con-
trols. Thus our right to know and ability
to perform the required oversight is pre-
served while essential confidentiality is
retained.
I would also like to call.to the atten-
tion of my colleagues the pressing need
for increased gasoline supplies for Cali-
fornia and the west coast. I raised the
issue of the shortage in domestic refinery
capacity on the west coast in the Floreign
Affairs Committee. My concern was noted
in the committee report, which indicates
consideration should be given to exports
of. petrochemical feedstocks, including
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naphtha, if such export would facilitate
the construction of new refineries de-
signed to produce unleaded gasoline or
other light fuels. Such a policy would
promote increased domestic production
and supply at a time when we are facing
a critical shortage. Such consideration
could help to provide for the construc-
tion of a new refinery in Alaska.
While there is still room for improve-
ment on some of the issues in H.R. 4034,
as I mentioned earlier, I believe the na-
tional security principles of,export con-
trols have been essentially preserved. I
also believe the proposed legislation
meets the concerns of business in clari-
fying licensing procedures and provid-
ing better access to the decisionmaking
process.
I want to state for the record that, for
many reasons, I support the provisions
in the bill concerning export of Alaskan
oil-the McKinney and Wolpe amend-
ments.
With those changes I have suggested,
I urge my colleagues to support H.R.
4034.
^ 1510
Mr. BINGHAM. Mr. Chairman, I yield
5 minutes to the gentleman from Michi-
gan (Mr. WOLPE).
(Mr. WOLPE asked and was given
permission to revise and extend his
remarks.)
Mr. WOLPE. Mr. Chairman, over 2
years ago, under the leadership of my
distinguished colleague from Connecti-
cut, Mr. MCKINNEY, the Congress adopted
an amendment to the Export Adminis-
tration Act to significantly strengthen
the broad, easily circumvented, oil ex-
port limitation in the TAPS Act. When
the amendment was adopted, Congress
thought a 2-year restriction on exports
would be sufficient time to encourage
the investments necessary to insure that
Alaskan oil would be marketed exclusive-
ly within the United States. Unfortu-
nately, none of the anticipated invest-
ments, such as the Sohio pipeline, have
been made, and the export of Alaskan oil
overseas continues to be contemplated by
the oil companies and the administra-
tion.
The bill before us today provides for
the necessary extension and strengthen-
ing of the current restrictions on the ex-
port of Alaskan oil. It extends the re-
strictions through 1983, at which time,
the Export Administration Act expires.
The limitations placed on the export of
Alaskan oil, as adopted by an overwhelm-
ing majority, of the members of the
House Foreign Affairs Committee, will
guarantee that no Alaskan oil leaves this
country unless it can be demonstrated,
beyond a doubt, to both Houses of Con-
gress, that such exports will directly ben-
efit the American consumer and that
such action is clearly in the national in-
terest. I would like to note that nothing
within the language of this provision
flatly prohibits the export of Alaskan
North Slope crude oil. The bill simply
states that the only acceptable criteria
for Alaskan oil exports are a showing of
direct consumer benefit and a showing
that such exports would not adversely
affect America's oil supply.
The provision before us requires the
President to make certain findings before
any exports may occur. It must be deter-
mined that-
Exports will not diminish the quality
and quantity of oil in the United States;
That exports will result in lower acqui-
sition costs to refiners;
That these lower costs will be passed
on to the consumer; and
That contracts for exports can be ter-
minated by the United States if our oil
supplies are terminated.
The bill permits, as a single excep-
tion, the use of Alaskan oil to meet bi-
lateral oil supply agreements entered in-
to by the United States prior to May 1,
1979. The only such agreement in effect
on that date was the agreement between
the United States and Israel originally
secured on September 1, 1975 and ex-
tended on March 26, 1979. This bill does
nothing to restrict other domestic
sources of oil from being used to fulfill
our oil supply commitment to Israel.
Finally, this bill requires ? 'that any
Presidential proposal to export Alaskan
oil be approved by both Houses of Con-
gress, a reasonable review process given
the importance of this question.
The key issue we are presented with
today is whether or not we are serious
about reducing American dependence on
foreign oil and fulfilling the original in-
tent of the Trans-Alaskan Pipeline Au-
thorization Act to deliver Alaskan oil to
domestic markets. If we are serious about
this, I would argue that we should be
doing, everything in our power to realize
within the United States the full poten-
tial of domestic oil production. This
means developing a new pipeline and in-
creasing our refining capacity to handle
the North Slope oil. But to permit the
export of Alaskan oil to proceed without
restriction would only reduce the incen-
tive to get the essential pipeline and re-
fining capacity in place and would extend
our dependence on insecure foreign oil
supplies.
When Alaska North Slope oil was dis-
covered 10 years ago, it was correctly
viewed as a major step toward American
energy independence. In the wage of the
Arab oil embargo of 1973, Congress en-
acted legislation authorizing the con-
struction of the $10 billion trans-Alaskan
pipeline so that Alaskan oil could be
transported to domestic markets. Fi-
nanced by American tax dollars, it was
the American people who were promised
exclusive use of Alaskan oil. And it was
the American oil companies that provided
clear assurances that Alaskan North
Slope oil would be marketed in the United
States, and that denied any intention of
exporting Alaskan oil. Now, the admin-
istration requests the authority to ap-
prove the exports of Alaskan oil as it sees
fit, possibly as a part of a three way swap
or exchange involving Mexico and Japan.
I maintain, that if Alaska North Slope oil
is exported, it will be the oil companies
that stand to gain and the American peo-
ple, our economy, and our national se-
curity that stand to suffer. We must ask
ourselves today to decide whether the
energy policy of this country is going to
be based on what is in the national in-
terest or whether it will be based on what
H 6411
is most profitable for a powerful vested
interest.
It should be said that there is no ques-
tion but that the oil companies would
realize substantial savings and increased
profits if Alaskan oil - were sent to
Japan-approximately $2 per barrel
would be saved in transportation costs.
But the American consumer would not
receive 1 penny of the reduction in oil
company costs. This is because the price
of Alaskan oil is already decontrolled;
Alaskan oil sells for whatever price the
market will bear, regardless of how
much-or little-it costs to get that oil
to its destination.
Indeed, the proponents of Alaskan oil
exports have readily acknowledged that
it will be the oil companies, and not the
consumers, who will be the beneficiaries
of reduced transportation costs. Their
argument-echoed-by the administra-
tion-has been that the oil producers re-
quire higher profit margins as an incen-
tive to realize the full production poten-
tial in the Alaskan North Slope.
So, let us look for a moment, at the
question of profits and incentives. Com-
paring the first quarter of 1979 with the
first quarter of 1978, SOHIO, the North
Slope's largest producer, enjoyed an in-
credible 302. percent profit increase.
Profits for the second quarter will be at
least 70 percent above first quarter
profits. According to a recent' article
which appeared in Petroleum Intelli-
gence Weekly, every barrel of Alaska
crude sold on the west coast brings the
oil company producers $4.11 profit after
taxes. That is 85 percent more than the
-oil companies were making on Alaskan
oil last December. At some point, I sub-
mit, we must begin to ask ourselves,
"When is enough, enough?"
Contrary to claims made by the ad-
ministration, the current restrictions on
Alaska oil exports have not held down
production. Directly contradicting these
claims is the recent announcement made
by the Alaska North Slope oil producers
of their plans to increase production by
25 percent, to 1.5 million barrels a day
by the end of next year. It does not seem,
therefore, that the existing limitations
on the export of Alaskan oil have been
much of a disincentive to increased pro-
duction. The plain fact is that we can
expect increased production in Alaska
because Alaskan North Slope oil is enor-
mously profitable, and has been made all
the more so by the recent OPEC in-
creases.
Much of the debate, in recent months,
has been focused on the notion of a
"glut" of crude oil on the west coast.
Despite all the publicity about a "glut"
..of oil on the west coast due to Alaskan
oil, all Alaskan North Slope production
is currently being utilized by U.S. re-
fineries. Even SOHIO has recently con-
ceded this point, making statements to
the effect that the need for their pro-
posed pipeline extending from California
to Texas has diminished because the west
coast surplus is proving less than ex-
pected. (New York Times, May 23, 1979).
In fact, every one of the 1.2 million bar-
rels of Alaska crude sent through the
Trans-Alaska pipeline each ?day is
handled by U.S. refineries without delay.
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West coast refineries take 850,000 to 900,-
000 barrels of that total; 75,000 is
shipped by foreign-flag tanker to the
Hess refinery in the U.S. Virgin Islands;
and about 225,000 barrels a day is sent
by U.S.-flag tankers to ports on the gulf
and east coasts, as well as Puerto Rico
and the U.S. Virgin Islands. Moreover,
over the last few months, west coast re-
fineries have increased their "take" of
Alaska oil from 600,000 barrels a day to
almost 900,000 barrels a day. Without
adding new refinery capacity or retro-
fitting existing refineries in any way,
west coast refineries can handle from 1
to 1.3 million barrels of Alaska crude per
day.
Mr. Chairman, I am convinced that
exporting Alaskan oil is the worst possi-
ble step we could take right now if we
are serious about achieving the goal of
energy self-sufficiency. As long as the
major oil producers are able to extract
much higher profits by the sale of Alas-
kan oil to Japan, they simply will not
have the incentive to develop the refin-
ing and pipeline capacity that this Na-
tion so desperately needs and that was
the initial promise held out at the time
of the approval of the Trans-Alaskan
Pipeline Act. Attempts to establish a na-
tional energy transportation system will
suffer a serious setback if Alaska oil is
exported exchanged.
Permitting Alaskan oil exports is pre-
cisely the wrong signal to be sending the
American people. At a time when we are
asking our people to recognize our seri-
ous energy problems, at a time when we
are asking the American people to dig
deeper into their pockets and pay more
for energy, and at a time that we are
faced with short gas supplies and the
prospect of shortages in home heating
oil this winter, the spectre of ships trans-
porting American oil to any foreign na-
tion is unthinkable-especially when the
only real beneficiaries of such oil exports
will be the oil companies themselves. The
bill before us today gives us the oppor-
tunity to cast a vote which will move
us closer to our Nation's stated goal of
energy independence.: urge your sup-
port of this legislation designed to insure
that American oil be reserved for Ameri-
can use.
Mr. Chairman, the provisions in this
legisltion extending and strengthening
the restrictions on the export of Alaskan
oil are strongly supported by a broad
range of organizations that represent a
cross section of America. These include
consumer, environmental, labor and in-
dustry groups. At this time, Mr. Chair-
man, I would like to insert in the RECORD
various statements of support for the
language contained in the committee bill
from some of these organizations.
The statements follow:
CONSUMER FEDERATION OF AMERICA-POLICY
STATEMENT ON ENERGY AND NATURAL RE-
sovaCES
Foreign dependence
"The United States' gross dependence on
OPEC oil forces consumers to pay artificially
high prices for energy, fuels inflation and
the decline of the dollar by contributing
too massive, persistent trade deficit, and
leaves the nation vulnerable to supply dis-
ruptions Instigated by the OPEC nations for
political or economic purposes. Yet national
energy policy has neither been as forceful
nor as expeditious as possible in reducing
this dependence; indeed many policies re-
inforce our dependence. United States policy
should be directed toward increasing domes-
tic supplies of energy for domestic use. The
national energy transportation system should
be improved to make possible a more efficient
and equitable distribution of domestic fuel
supplies. The Consumer Federation of
America opposes the export or swap of
Alaskan oil unless it can be shown that such
an export or swap would be in the consumers'
interest and would not jeopardize national
security. In addition to the creation and
development of national alternatives to for-
eign oil, the following immediate initiatives
should be taken:,
A. Creation of a Federal oil importing
agency which would purchase the nation's
Import needs by securing sealed bids from
all oil producing nations ...
C. Encouragement of greater productions
of oil from non-OPEC oil producing
nations ...
STATEMENT BY THE AFL-CIO EXE"UTIVE COUN-
CIL ON ALASKAN OIL EXPORTS
BAL HARBOR, FLA.,
February 22, 1979.
Administrative consideration of the pos-
sible export of Alaskan oil raises the gravest
dangers for the nation's economic and de-
fense security. The export of this oil would
be a consumer rip-off engineered by the
nation's oil companies to obtain greater
profits. The American consumer would gain
nothing and would suffer the loss of some
of America's secure oil supply.
At a time when the nation faces oil cut-
backs at U.S. refineries, declining imports
from Iran, and the prospect of gasoline
rationing, exports of U.S. oil supplies would
be a national energy policy disaster.
The Administration is considering sending
Alaskan oil to Japan in exchange for oil from
foreign countries, including Mexico. The na-
tion's oil companies, viewing the world from
the selfish position of multinational corpora-
tions, want such nation-to-nation swaps.
Such-swaps would obtain no additional oil
supplies for the. US.
Swapping U.S. oil for foreign oil makes no
sense-In terms of economics or national
security. It is nothing more than a gimmick
devised by the oil companies to circumvent
U.S. law and boost their profits.
In 1973 and again in 1977 the Congress
placed explicit limits on Alaskan oil exports
as a result of national concern over energy
shortages. The McKinney Amendment to the
Export Administration Act provides for a
congressional veto of any Alaskan oil export
plans.
Oil exports from Alaska or other U.S.
sources would. leave the U.S. more dependent
on the OPEC cartel or on unstable develop-
ing countries.
Oil exports do not aid the nations trade
balance, as exports would be nullified by
equivalent oil imports.
The consumer would gain no benefit, be-
ing forced to pay the international price for
oil wherever it may come from. The U.S.
economy would suffer the loss of tanker
employment, shoreside and shipyard jobs,
and the tax and wage benefits they produce.
The AFL-CIO has consistently opposed
Alaskan oil exports. We now believe the ex-
isting legislation restricting Alaskan oil ex-
ports should be extended and strengthened
to prevent yet another oil company rip-off of
the American people.
It is perfectly feasible to transport this oil
directly from Alaska to the East and Gulf
Coast ports by tanker or rail. Furthermore,
the construction of a Northern Tier pipeline
would serve the national interest. Using the
U.S. transportation system would protect this
vital oil supply from cartels and unstable
foreign markets.
CONSUMES ENERGY COUNCIL OF AMERICA,
Washingtcn, D.C.
Re: H.R. 3301, Amendment to the Export
Administration Act to restrict exports of
Alaskan oil.
DEAR REPRESENTATIVE: The Consumer
Energy Council of America, a broad-based
coalition of consumer, labor, farm, public
power, rural electric cooperative, urban,
and senior citizen organizations, urges you
to support H.R. 3301, the bill to extend and
strengthen the McKinney amendment to the
Export Administration Act, which restricts
exports of Alaskan North Slope oil.
The Consumer Energy Council supports
H.R. 3301 because of the detrimental conse-
quences-to consumers and the nation-of
exporting Alaskan oil. Among these are the
following:
Exporting or swapping Alaskan oil would
increase our dependence on foreign o11 by
removing incentives to do the work needed
to enable us to use all of potential Alaskan
production within the U.S.: retrofitting
existing refineries to accommodate Alaskan
crude, building new refineries, and adding
to our internal oil transportation network.
If we allow Alaskan oil to be exported and
our foreign supplies of oil are later cut off,
we would not be in a position to divert Alas-
kan oil to our own use because the infra-
structure necessary to using that oil would
not be in place.
Exports of Alaskan oil will hurt our
balance of payments, because the U.S. will
receive less from sales of Alaskan oil to for-
eign customers than will be needed to import
a comparable amount of oil into the lower
48 states.
Exporting Alaskan on will reduce plenti-
ful supplies that last year resulted in dis-
counts of up to 750 per barrel on Alaskan
crude, a clear benefit to American consumers.
Exporting Alaskan oil will be a powerful
negative symbol in the eyes of the public,
making the government appear disingenuous
when it calls for conservation so that im-
ports of oil can be reduced, while simultane-
ously exporting oil from Alaska. Support for
voluntary conservation efforts will diminish
and-since exports benefit only the com-
panies producing the oil-the popular suspi-
cions that U.S. energy policy consistently
favors the oil companies will increase.
If exporting Alaskan oil. is clearly in the
national interest or if it, would demonstrably
reduce petroleum product prices for con-
sumers, H.R. 3301 would allow such exports.
At present, however, such exports are in the
interests of neither the nation or consum-
ers. We therefore ask your support of H.R.
3301 which will prevent these exports unless
appropriate findings of its benefits can be-
made.
Sincerely,
ELLEN BERMAN,
Executive Director.
ENVIRONMENTAL POLICY CENTER,
Washington, D.C.
To: Members of Congress.
From: Hope Robertson, Environmental Po-
licy Center; Brock Evans, Sierra Club;
Rafe Pomerance, Friends of the Earth.
Re: Export Administration Act-Exporting
Alaskan Crude Oil.
The Export Administration Act will be
coming before Congress for reauthorization
in the near future. One of the most import-
ant provisions of this act deals with exports
of Alaskan oil, a provision we strongly urge
you to support. This provision requires the
President to demonstrate to Congress 'that
exporting Alaskan Oil will not have a detri-
mental effect on Important factors such as
the cast of oil to the consumer, or the avail-
ability and quality of petroleum for domes-
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tic refineries. It is not a prohibition on
Alaskan oil exports. This amendment will
insure that the Congress, as well as the
Administration, plays a major role in decid-
ing whether or not Alaskan oil should be
exported. Unless Congress renews the lan-
guage, Congressional involvement in the
development of an export policy for Alaskan
oil, will end when the provision expires in
June of this year.
Background
When the Trans-Alaskan Pipeline System
(TAPS) was approved by Congress in late
1973, the environmental community and
others accurately predicted that the west
coast would not be able to handle all of the
Alaskan production without major changes
in the refineries. We advocated the construc-
tion of a Trans-Canadian route which would
have delivered the oil to the Northern Tier
states and mid-west, sections of the country
now in need of petroleum. However, the oil
companies assured Congress and the nation
that the TAPS route was the best one and
that handling Alaskan production on the
west coast would be no problem.
Fortunately, some members of Congress
were farsighted enough to suspect that a ma-
jor motive behind the oil companies' prefer-
ence for the "All-American" TAPS route was
not to get better access to American markets
but rather better access to Japanese markets.
To insure that the oil industry kept their
promise about producing Alaskan crude for
the benefit of domestic markets, an amend-
ment was added to the Export Administra-
tion Act more than two years ago, which al-
lowed exports of Alaskan oil if such a policy
would not have a detrimental impact on
other facets of our domestic petroleum pic-
ture. When the amendment was adopted in
1977, Congress thought a two year restriction
on exports would be sufficient time to en-
courage the investments needed to handle
Alaskan oil on the west coast. Once these in-
vestments were made, it was felt that there
would be major financial incentives to mar-
ket Alaskan crude domestically.
Unfortunately, none of the necessary in-
vestments, such as retrofitting refineries,
have been made. The combination of relative-
ly low production levels during the first two
years of the pipeline's operation and the
knowledge that the language in the Export
Administration Act would expire in June
1979, raises some doubt as to whether the
North Slope producers had any intention of
making the large capital commitments in
domestic refineries or pipelines during this
two year period. The interest of the oil in-
dustry in making investments domestically
is particularly suspicious considering that
the prospects of exporting Alaskan oil prom-
ised to be far more lucrative with relatively
little additional investments required.
Current status of Alaskan production and
use
Despite all of the publicity about a so-
called "glut" of oil on the west coast, all
Alaskan production (1.2 million barrels/day)
Is currently being utilized in west coast and
Gulf refineries. There is speculation that this
surplus publicity was intended to put pres-
sure on the Administration and Congress to
approve exports of Alaskan oil. But the in-
dustry's complaints about the west coast oil
surplus seem to have backfired on them re-
cently. When Sohio announced they were
thinking of cancelling their pipeline project
from California to Texas, there was an uproar
in the Administration and Congress to save
the project. Reducing the west coast surplus
was viewed as a major reason to construct the
Sohio pipeline by the Administration and
Congress to the point where they have taken
steps to insure that Sohio can build the
pipeline.
This unexpected reaction to Sohio's an-
nouncement to cancel the project seems to
have placed Sohio in an awkward position.
They are no longer saying that the west
coast is swimming in oil and instead, are
making statements that the need for the
pipeline was diminishing because the west
coast surplus was proving less than expected.
(N.Y. Times 5/23) This places the North
Slope producers in delicate position as it is
hard to lobby for approval of Alaskan oil ex-
ports in order to alleviate the west coast
surplus when simultaneously the companies
are saying the surplus is not bad enough to
justify construction of a pipeline to trans-
port the oil off the west coast. Obviously,
the real status of a "glut" of oil on the west
coast needs to be determined before we ap-
prove exports of Alaskan oil to alleviate a
potentially non-existent problem.
Language is still needed to control Alaskan
oil exports
The language in the Export Administra-
tion Act will insure that any decision made
by the Administration to export Alaskan oil
must be reviewed and accepted by Congress.
In light of the enormous implications ex-
porting Alaskan oil will have on many facets
of our petroleum supply picture, Congres-
sional involvement is vital.
For example, Congress must advocate poli-
cies which will encourage retrofitting of re-
fineries on the west coast and elsewhere in
the nation, so that they can handle heavier
crudes, such'as Alaskan. The availability of
large quantities of Alaskan oil, coupled with
changes in U.S. refinery policies cannot help
but be an incentive to retrofit these re-
fineries. Any exports of Alaskan oil must not
discourage these important changes in our
domestic refining capabilities.
Another area affected by Alaskan oil ex-
ports, is pipeline construction. The cost and
environmental risks of tankers make the use
of some pipeline network from the west coast
inland, important to consider. If it turns out
that construction of pipelines is economical-
ly efficient and environmentally preferable,
exporting Alaskan oil may undermine the
viability of the projects unless the exports
are carefully controlled.
These issues and many others need careful
analysis before a decision regarding exports
of Alaskan oil is made. To insure that the
Administration develops a policy which will
maximize the benefits to the public and our
long term petroleum supply picture, we urge
you to vote for the renewal of language
controlling Alaskan exports.
^ 1520
Mr. LAGOMARSINO. Mr. Chairman,
I yield 2 minutes to the gentleman from
Illinois (Mr. DERWINSKI).
(Mr. DERWINSKI asked and was
given permission to revise and extend
his remarks.)
Mr. DERWINSKI. Mr. Chairman, my
understanding is that the administra-
tion, despite its public statements in sup-
port of authority to barter or sell
Alaskan oil to Japan, does not intend to
fight on the issue.
Therefore, I wish to reemphasize my
views for the record. The McKinney-
Wolpe amendment absolutely prohibits
the sale or barter of Alaskan oil to
Japan. I believe that the executive
branch should have flexibility to be able
to swap that Alaskan oil, which we are
unable to refine on our west coast, for
oil from other areas to be delivered to
our east coast refineries. If such a swap
should become advantageous because it
is cheaper, the executive branch should
have the authority to carry out the
swap-in our national interests. I believe
H 6413
that our real security interests should
include that option.
We have a $12 billion annual trade
deficit with Japan. With this option to
swap Alaskan oil, we could reduce our
trade imbalance, increase our economic
leverage with Japan, maximize produc-
tion of Alaskan oil, and by the offsetting
agreements, help meet the energy needs
of American consumers.
Also, I am looking forward to the
amendments to this bill suggested by my
colleagues, Mr. ICHORD and Mr. DICKIN-
soN. There may well be some sections of
this bill regarding the protection of U.S.
security interests which can be improved
by amendment. I naturally support in-
creased trade, but we must carefully
weigh our national security needs.
I would like to make two very brief
points. One is that I voted against going
into the Committee on this measure since
I felt that it was far too important a
subject to be debated on an afternoon
when there was barely minimum at-
tendance. I regret the fact that a bill of
this magnitude has been scheduled when
most of our Members are not in town.
The other point is I for one- am a
champion of the right of the administra-
tion to swap Alaskan oil. I realize that
because of the palace coup that took
place last week the administration seems
to be in total disarray. It is my under-
standing they are not going to try to
knock out the McKinney-Wolpe amend-
ment, so I am not going to be doing their
work for them. But let me point out it
would be good administrative policy to
have the option to swap. It would reduce
our balance-of-payments deficit with
Japan. The real beneficiaries would be
the consumers on the east coast, and
that is ironic because the environmen-
talists on the east coast have done more
to mess up our energy situation than any
segment of society. Yet now they do not
have enough commonsense to appreciate
the fact that a swap of Alaskan oil would
be to their benefit.
With those words of wisdom, I yield
back the balance of my time.
Mr. LAGOMARSINO. Mr. Chairman,
I yield 4 minutes to the gentleman from
Montana (Mr. MARLENEE).
(Mr. MARLENEE asked and was given
permission to revise and extend his re-
marks.)
Mr. MARLENEE. Mr. Chairman, I
rise in support of the provisions to main-
tain the prohibition on exporting Alas-
kan crude oil as contained in the Export
Administration Act of 1979, H.R. 4034.
This Nation must vigorously pursue
the goal, of increased domestic produc-
tion of oil and the maximum utilization
of our own reserves. The recent prob-
lems, so clearly illustrated by the shut-
down of Iranian oil production, from
where we received only 10 percent of our
oil imports, ? have all too sadly pointed
out just how little we learned about the
consequences of increased dependence
? on foreign nations for our crude oil sup-
plies. This dependence has now reached
a point where approximately 48 percent
of our oil needs come from foreign
nations.
This level of dependence is dangerous,
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CONGRESSIONAL RECORD -HOUSE July 23, 1979
and indeed could bring this Nation to a
standstill should the unstable picture in
the Middle-East worsen. Furthermore,
this dependence is absolutely unneces-
sary. Our country has a wealth of oil in
Alaska that can decrease our energy de-
pendence and at the-same time do much
to increase our level of energy independ-
ence.
The United States must utilize its
Alaskan reserves to the fullest extent
possible here in this country and not in
Japan or any other nation. These re-
serves are, however, being underutilized
because of the failure to construct a
pipeline to transport this crude oil from
Alaska to the lower 48 States. This fail-
ure is, to a large degree, due to massive
Federal regulations. These requirements
have been partly to blame for the with-
drawal of the Sohto Company's proposed
pipeline from California to Texas.
Nonetheless, we do have another
chance to bring this crude oil to the
lower 48. This chance is the Northern
Tier pipeline. If we put our energies in-
to the construction of the pipeline
rather than into the obstruction of the
pipeline, we will take a major step to-
ward maximizing the use of our Alaskan
reserves. This pipeline, as many of you
know, will be capable of bringing Alas-
kan oil to all of the Northern Tier States
and refineries from Washington to Min-
nesota. It also has the potential of sup-
plying Alaskan oil to secondary markets
as far south as Kansas City. These bene-
fits do not even include the obvious ones
of savings to our balance-of-payments
problem and increased jobs that will
result.
Construction of the pipeline can only
be accomplished, however, by maintain-
ing the prohibition against exporting
Alaskan oil. To allow the export of
Alaskan oil, will leave this Nation with-
out a pipeline for efficiently transporting
the oil to the lower 48 States. The Nation
is facing a termination, by 1982, of all
Canadian crude oil imports not on an
exchange basis. The refineries in the
Northern Tier have been heavily de-
pendent on these Canadian supplies and
to allow this to happen would subject
these States to the same oil shortage
problems now plaguing the Northeastern
section of this Nation.
Because of this situation Montana is
now in danger of not having sufficient
diesel fuel to harvest the crops now
standing. The crops will not wait, hun-
gry cold people will not wait and we
should not wait on using our own oil
'in our own pipeline.
One other point needs to be made
about the need to keep our Alaskan oil
reserves in this Nation. The President,
in his recent energy speech, etphatically
stated his intentions to import not one
more drop of oil into the United States
than what was imported in 1977. If he
intends to hold to this goal then there
is no question but that Alaskan oil must
not be exported.
I urge my colleagues to vote in favor
of H.R. 4034 and in favor of increased
energy independence.
Mr. BINGHAM. Mr. Chairman, I yield
3 minutes to the gentleman from Minne-
sota (Mr. VENTO).
(Mr. VENTO asked and. was given
permission to revise and extend his
remarks.)
Mr. VENTO. Mr. Chairman, I want
first of all to congratulate the gentleman
from New York (Mr. BINGHAM), the
ranking minority member and the mem-
bers of the committee for their work in
bringing this legislation to the floor. The
amendment to the Export Administra-
tion Act, which we have under considera-
tion today, I think will go far to bring
rationality to the export licensing, which
at times seems to defy explanation.
The fact of the matter is I think the
review of various products and commod-
ities leaving this country is, of course, an
extremely important task in a time when
we are concerned about our national se-
curity, when we are concerned about the
balance-of-trade problem that this coun-
try faces. I believe that the balance-of-
trade problem probably eclipses any
other economic problems that our coun-
try has to deal with and, indeed, the
resources and the amendments to Export
Administration are modest considering
the magnitude of the balance-of-trade
problem. When we look at the authoriza-
tion in the bill for $7 million and $8 mil-
lion for fiscal years 1980 and 1981, re-
spectively, the authorization level, in-
deed, is a modest effort to try and facili-
tate what should really be a centerpiece,
a keystone of our trade program.
The other resources and tools available
through the Export-Import Bank are
again modest, when compared to the
magnitude of the need. This country in
the past fiscal year exported in excess of
$175 billion worth of goods and com-
modities.
On the opposite side of that we im-
ported something in the neighborhood of
$200 billion-plus which, of course, results
in our balance-of-trade deficit, largely
from the importation of foreign oil that
has so plagued our economy and will con-
tinue to do so until we diminish the use
of it, and until we can increase the com-
modities that we trade abroad.
This bill, I think, provides for some
major initiatives to accomplish that in-
crease in trade. I think these are modest
provisions, and I think the provisions for
bartering are good. As an example I
think that it provides the opportunity to
reduce costly overregulation that has
been superimposed on our businesses,
multinational corporations in this coun-
try which really, in essence, has resulted
in the loss of the business, the loss of the
jobs, the loss of some markets to the
American products and to this country in
general, only to have those other coun-
tries in which the multinational com-
panies are located pick up those same
business contracts.
^ 1530
So, I hope that this sets a demarcation
no matter what the structure of our Gov-
ernment trade administration, and I
know that there have been major reforms
suggested for structuring or restructur-
ing our administration, the amendments
to the Export Administration Act will
help facilitate trade. Unless we put into
the administrations' hands a clear.pol-
icy, which the gentleman and the sub-
committee have attempted to do in this
case, we will not fare well in terms of
our trade initiatives: .I think this is a
commendable effort along those lines.
We have a long way to go before the
realization of our improved trade goals
and curbing the limits we have self im-
posed, trade restrictions which operate
to an American disadvantage, in the
world marketplace and beyond the ac-
tual needs of national security and our
responsibilities to set a policy for the free
world.
Let me point out an example of the
problems we hopefully will avert in our
future trade activities.
I recall specifically a recent instance
when Univac, a major employer in my
district, lost a $6.8 million computer con-
tract because of misguided foreign pol-
icy consideration and prolonged delays.
Tass, the Soviet?news service, in an effort
to upgrade its news handling facilities in
preparation for the Moscow Olympic
games contracted for a down-rated com-
puter similar to one previously licensed
for export to Aeroflot, the Russian air-
line.
The computer was ready to be shipped
in July 1978 but the stalling game by
our Government continued until early
April 1979 when finally the license was
cleared. By that time, Tass decided to
terminate its agreement with Univac and
place an order with a French computer
consortium for a more sophisticated and
expensive system-$17.5 million-and
one presumably usable in defense appli-
cations. .
As a consequence of the Government's
maladroit handling of this export license
application, the country lost a sizable
contract, many man-years of work, and,
of course, profits, and opened the oppor-
tunity for the Soviets to purchase. a com-
puter system with possible defense-re-
lated capabilities.
A further result of forcing the Soviets
into the arms of the French computer
consortium is a new and more ominous
development for the U.S. national se-
curity. A few days ago it was announced
that as the fruit of the Tass computer
sale the Soviet Union and France have
reached a basic understanding to develop
jointly a generation of computers and
related equipment for the use in the dec-
ade after 1985. What the Soviets could
not get if they were to rely on U.S. com-
puter suppliers they will now quickly re-
ceive through- their acquiescent French
connection, CII-Honeywell-Bull.
I believe it is essential if we are serious
about international trade, about reduc-
ing the adverse balance of trade and
grout coping with domestic inflation
that we do a better job of organizing our
export licensing process.
The bill H.R. 4034 should be passed.
Mr. LAGOMARSINO. Mr. Chairman,
I yield 5 minutes to the gentleman from
Connecticut (Mr. MCKINNEY).
(Mr. McKINNEY asked and was given
permission to revise and extend his
remarks.)
Mr. McKINNEY. Mr. Chairman, since
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I first become involved in the effort to
restrict the export of Alaskan oil, I have
witnessed a number of attempts to
justify the export of one-half million
barrels of that oil each day. One of the
most enduring of these arguments has
been the need for Presidential "flexi-
bility" in utilizing the 2 million barrels
of oil from Alaska's North Slope. Armed
with the "flexibility" argument, this ad-
ministration and other proponents of
Alaskan oil exports have unabashedly
pursued the simultaneous and contra-
dictory goals of decreasing our reliance
on imports and exporting Alaskan crude.
I think it is high time that the Presi-
dential "flexibility" argument be put to
rest-for good. Such flexibility may be
needed in managing the Department of
Energy but it has no place in efforts to
free ourselves from the stronghold of the
OPEC nations. There is only one clear
path to achieve that goal-the use of
every available source of domestically
produced energy in domestic markets.
This Congress has taken a great deal
of criticism from the American people,
the American business community and
the administration for its failure to pass
necessary energy initiatives. Some of
that criticism is justified. But the record
should be set straight. It was. this body
passed the first synthetic fuels bill 1
month ago. It was in this body that the
first solar energy development bank was
proposed. Two years ago this body en-
acted an amendment to commit the na-
tion's offshore oil to domestic use. And,
it was in this body that the only legisla-
tion committing Alaskan oil for domestic
use was passed, 240-to-166. I know this,
Mr. Chairman, because I have been
directly involved in each of these efforts.
Today, the House of Representatives
again has the opportunity to demonstrate
its commitment to a future of energy in-
dependence by extending the restriction
on the export of Alaskan oil. Justification
for the extension of the export ban goes
far beyond the most obvious arguments
for committing domestically produced
oil to domestic use. The justifications are
more substantial than the need to hold
the North Slope producers accountable
to their promises, made in 1973 when the
Trans-Alaska Pipeline Authorization Act
was passed, of foregoing the financial at-
traction of exports and reserving Alaskan
crude for use in domestic markets. The
arguments for extending the export re-
striction on Alaskan oil-which expired
on June 22-go beyond even the debilita-
ting effect which an export or exchange
would have on the already crippled U.S.
maritime industry. There are sound eco-
nomic reasons which dictate the need to
insure that Alaskan oil is delivered, re-
fined and consumed in U.S. markets.
These reasons, Mr. Chairman, cannot be
overcome by some inappropriate fixa-
tion upon Presidential "flexibility" in de-
cisionmaking.
Reduced transportation costs, which
work to increase producer profits, is an-
other durable argument of questionable
reasoning that proponents have used to
justify the export of Alaskan crude. It is
true that the Alaskan North Slope pro-
ducers stand to gain an additional $2 per
barrel-averaging delivery costs to both
the west and the gulf coasts-by export-
ing that oil rather than delivering it to
domestic markets. However, in making
the transportation savings, that $2 per
barrel would not be realized by the con-
sumer. The total savings would instead
be added to a steadily increasing profit
margin resulting from the production of
North Slope crude.
Proponents of an export or exchange
claim that the transportation savings are
necessary in order to insure profitability
in producing Alaskan oil. The facts show
otherwise. Consider that in the first
quarter of this year, Standard Oil of
Ohio, the North Slope's largest producer
with 52 percent of the oil, increased its
profits over the first quarter of the pre-
vious year by 302 percent. That increase
was attributed by the chairman of Sohio
to production on Alaska's North Slope.
Profits for the second quarter of ' this
year, due to be reported this week, should
show an additional 70 percent increase
above the first quarter. And, after tax
profits for Alaskan oil delivered on the
west coast are an incredible $4 per bar-
rel. That figure represents an 85 percent
increase in after tax profits reported in
December.
In light of this very lucrative venture,
arguments for increasing producer pro-
fits by saving in transportation costs can-
not compare with the need to commit
that oil to our domestic markets. Not only
do the figures indicate that the Alaskan
oil producers are presently enjoying a
tremendous return on investment; they
further refute the arguments posed that
increased profits are necessary for meet-
ing additional production. Without an
export option, and therefore without the
additional transportation savings of an
export, the North Slope producers have
already scheduled a 25-percent increase
in production by the end of this year.
Furthermore, Atlantic Richfield Co., an-
other North Slope producer, has an-
nounced plans to begin commercial de-
velopment of. Alaska's Kuparuk field at
60,000 barrels per day by 1982. Clearly,
these production plans argue persuasively
against the need to open Alaskan oil pro-
duction to the world markets.
Proponents of an export or exchange
of Alaskan oil have made further argu-
ments that insufficient markets for Alas-
kan oil in the United States necessitate
an exchange. If there was any validity to
these arguments in 1975, there is cer-
tainly none today. Unlike a few years ago
when I first became involved in this is-
sue, there are more than adequate mark-
ets, in fact growing demands, for Alas-
kan crude. Its heavier gravity makes it
most suitable for distillation into home
heating oil and when compared to $30 to
$35 a barrel spot market crude, it is no
wonder that U.S. refiners in the Carib-
bean are eager to receive $18 Alaskan
crude.
On the west coast, where the infamous
Alaskan oil "glut" became the rallying
cry for export proponents, refiners have
increased their take of Alaskan crude
from 600,000' barrels per day to almost
900,000 barrels per day in the last few
months. This new-found refining capac-
ity and the elimination of the "glut"
are most likely attributable to both the
H 6415
increasing profitability of producing
Alaskan oil and the sharp rise In, the
price of imported crudes.
Officially, however, west coast refiners
claim the 300,000 barrel per day increase
in ANS crude refining is a result of:
First, experience with handling the oil,
second, the ripple effect of the shut down
of Iranian production, and third, the fail-
ure to bring San Joaquin Valley produc-
tion on line as expected. Interestingly
enough, the increased refining of Alas-
kan crude on the west coast has occurred
without the expensive refinery retrofits
that were earlier alleged to have been
ncessary in order to profitably market
Alaskan oil in the lower 48.
This increasing demand for Alaskan
crude in the domestic markets is all very
good and understandable but can be no
substitute for the continuing need to de-
velop an effective transportation system
to distribute the oil eastward. Producers
of Alaskan oil, most notably Sohio, as-
sured this House on several occasions
that any export or exchange of Alaskan
oil would be a temporary one because
their plans for the construction of a pipe-
line to deliver that oil would be fulfilled
in a few years.
Short of saying "I told you so," I have
long contended that Sohio's Pactex Pipe-
line Project, which was to deliver Alas-
kan crude from Long Beach, Calif., to
Midland, Tex., was a convenient argu-
ment to delay the enactment of an
Alaskan oil export restriction. Despite
the success of legislation in the House
Interior Committee, which would have
effectively eliminated any further
environmental obstruction to the Pac-
tex project, and despite the administra-
tion's commitment to the same, the
board of Sohio chose to strap the project.
I would suggest that the increasing
marketability of Alaskan crude on the
gulf and west coast played a role in that
decision.
The need to develop a transportation
infrastructure to deliver Alaskan crude
east still remains. Despite Sohio's deci-
sion, the Government has a responsibility
to revitalize that project and to grant all
the regulatory and financial assistance
necessary to complete the Northern Tier
Pipeline project. Without a clear man-
date from this Congress, committing all
of the North Slope's produ:tion to U.S.
markets, the incentive to proceed with
these projects will quickly fade away.
Questions have been raised, Mr. Chair-
man, about the effects on the U.S. bal-
ance of trade in the event of an export or
exchange. Let me make this clear. Alas-
kan oil is now and, unless regulatory
action is taken, will in the near future
be priced lower than either Mexican or
OPEC crude Therefore, in the event of
an exchange of Alaskan oil for foreign
crude, this country would incur a bal-
ance-of-trade loss. In a study by Robert
R. Nathan Associates the question of an
Alaskan oil exchange was analysed. That
study found that even reducing annual
costs to this country by 0.37, which rep-
resents the net amount of total outlays
to' foreign sources returning to the
United States. in the form of demand for
domestically produced goods and serv-
ices, under a best-case scenerio-wherein
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CONGRESSIONAL RECORD-HOUSE July 23, 1979
half of the Alaskan oil is transported on
American bottom tankers and exchanged
with Japan for Mexican - crude-the
United States would incur a $182 million
deficit annually.
Finally, Mr. Chairman, let me empha-
size that the legislation which I intro-
duced and which was subsequently
included in this bill, H.R. 4034, is
intended to apply solely to oil that is
transported pursuant to rights of way
granted under the Trans-Alaska Pipeline
Authorization Act of 1973. Nor does this
legislation in any way attempt to pre-
clude the fulfillment of our treaty obliga-
tions with Israel either pursuant to the
1975 Sinai Treaty nor the most recent
agreement resulting from the Egyptian-
Israeli peace agreement.
Mr. Chairman, we need to commit
every available domestic energy resource
to our battle for political and economic
independence Alaskan oil is among the
most readily available of those resources.
I was heartened by the action of the
recent Senate in passing an export
restriction that is simlar to one before us
today. It was pleasing to learn that so
many Members of that body, who just
2 years ago had voted against an
export ban, have realized the importance
of insuring the domestic distribution of
that oil. I commend the Senate for its
action and I urge all of my colleagues in
the House to support this legislation.
Mr. BINGHAM. Mr. Chairman, I yield
5 minutes to the gentleman from Mis-
souri (Mr.ICHORD).
(Mr. ICHORD asked and was given
permission to revise and extend his re-
marks.)
Mr. ICHORD. Mr. Chairman and
members of the committee, I thank the
distinguished gentleman from New York
for yielding me this time. But, I must
agree, Mr. Chairman, with the gentle-
man from Illinois (Mr. DERWINSKI). I
think it is unfortunate that a bill of this
magnitude is being debated today when
so many Members are not here to hear
this very important matter being de-
bated.
I also agree with the gentleman from
California (Mr. LAGOMARSINO), that the
provisions regarding reexport conditions
must be deleted from this bill. H.R. 4034
has been reported out of the.Committee
on Foreign Affairs as a result of consid-
ering eight bills. One of those bills H.R.
3216 was referred to the House Armed
Services Committee. In fact, this bill
covers one subject which is also under
the jurisdiction of the House Armed
Services Committee, and that is the
transfer of military technology.
The House Armed Services Committee
has held long and extensive hearings
on this particular aspect, and in fact the
hearings are still being conducted on
H.R. 3216, one of the bills that was con-
sidered in making up H.R. 4034. I have
hearings scheduled for tomorrow morn-
ing, and the House Armed Services Re-
search and Development Subcommittee
has voted to offer several amendments
to this bill which I think must be adopt-
ed in the interest of national security.
Mr. Chairman, the reason why I say
this-and I think perhaps the gentle-
man from New York will agree, although
he may disagree as to the effects of the
particular provisions of this bill-is that
on May 24 Mr. Larry Brady, the Acting
Director of the Office of Export Adminis-
tration, testified before the Subcommit-
tee on Research and Development that,
and I quote: "The export control system
as it is today is a total shambles."
^ 1540
After extensive review, I would say
with respect to the transfer of military
technology, that any inaccuracies in that
evaluation by Mr. Brady as far as na-
tional security is concerned lie only in its
understatement of the current situation.
For example, last Wednesday I received
a letter from Secretary Kreps advising
me that contrary to testimony received
and to news accounts, there was in fact
no diversion in connection with the
Kama River truck factory. I would ad-
vise the members of the committee that
we have not only transferred according
to some sources about $1.5 billion worth
of machinery but also sophisticated com-
puters that make up the Kama River
truck factory, the largest truck factory
in the world.. This statement by Mrs.
Kreps, made in the face of credible and
verified reports that hundreds of trucks
from Kama River have been seen in
military units in eastern Europe, caused
me to schedule this hearing tomorrow
morning to get to the truth in this mat-
ter. If in fact there is no violation of U.S.
export controls as alleged by Secretary
Kreps, then I would question the wisdom
of our entire export policy.
In any event, Mr. Chairman, on behalf
of the Research and Development Sub-
committee, I will offer one amendment
affecting the transfer of critical military
technology. The amendment which will
be offered to the House will bring about
a clarification of the Secretary of De-
fense's responsibility for identifying cri-
tical technology, and the amendment will
also mandate that a list of critical tech-
nology be established by October 1, 1980.
I believe the critical technology approach
is ready to fly and is the only safe and
sane way of protecting our perishable
technological lead over our potential
adversaries.
The second amendment which I will
offer seeks to delete the authority for
the establishment of a procedure to iden-
tify technology thresholds below which
goods and technologies would be ex-
empted from special licensing require-
ments. This procedure titled "indexing"
defies effective administration and would
be an exercise in dangerous speculation
from a national security perspective.
My final amendment deletes the afore-
mentioned provision eliminating require-
ments for reexport permits. This provi-
sion should be of great concern to the
proponents of trade for in the absence
of reexport controls a substantial num-
ber of license applications are likely to
be denied. Likewise this provision would
significantly effect controls for national
security purposes.
Mr. Chairman, there are three con-
siderations which must be made in ad-
ministering export controls: Protection
of our domestic economy: regulation of
trade for consistency of foreign policy,
and restriction of export of goods and
technologies to protect our national se-
curity.
It is this last consideration, national
security which is our concern.
The CHAIRMAN. The time of the gen-
tleman has expired.
Mr. BINGHAM. Mr. Chairman, I yield
3 minutes to the gentleman from Texas
(Mr. RonERrs).
(Mr. ROBERTS asked and was given
permission to revise and extend his re-
marks.)
Mr. ROBERTS. Mr. Chairman, I ap-
preciate%the gentleman from New York's
yielding me time. I was just checking
the monitor when the gentleman from
Michigan was talking about prohibition
of any shipment of Alaskan oil to other
countries. That obviously is based on
the assumption that a barrel of oil is a
barrel of oil, and that simply is not so.
My district has in it the largest pro=
ducing oil field in the world. East Texas
oil field has been producing now for 50
years. It had 26,000 producing wells at
one time. They produce a high-gravity
oil. The oil from Alaska is not only low-
gravity, it is high-sulfur, which means
in the refining process it makes a lot
of sulfuric acid, and for that reason only
three or four of the California refineries
can handle it and it has to be shipped
to Texas where all the coast oil is high
sulfur.
So let me put it this way. With Alaska
oil, a barrel, of course, is 42 gallons. You
get maybe 14 to 18 gallons of gasoline or
distillate. With Indonesian crude you
get about 24 to 26 gallons of middle dis-
tillate or gasoline. The value of the
Alaskan crude is primarily in the feed-
stocks because you can make four or
five times as many plastics and other
products out of Alaskan crude as you
can out of Texas crude, or 10 times as
much maybe as Indonesian crude.
I hope the committee will look into it
thoroughly and not put a prohibition on
it, because if we can trade one barrel
of Alaskan crude for one barrel of In-
donesian crude, we are going to get a
lot more gasoline and distillate than we
would otherwise. It is true we would lose
the feedstocks, but we have all the feed-
stocks we can possibly use. I am sure
if the committee will check into it, they
will find that a prohibition will not be
to our best interest. If we can trade for
Mexican crude, we would average 50 per-
cent more gasoline or distillate from
Mexican crude, if we could trade on a
barrel-for-barrel basis. I hope we would
not prohibit the transfer before-we get
Mexican crude or Indonesian crude in
return.
I thank the gentleman very much.
Mr. LAGOMARSINO. Mr. Chairman,
I have no further requests for time at
this time, and I will reserve the re-
mainder of my time.
Mr. BINGHAM. Mr. Chairman, I yield
myself so much time as I may consume.
Mr. Chairman, I would like to com-
ment very briefly on two of the points
raised by the gentleman from Missouri
(Mr. ICHORD), who has been conducting
extensive hearings on this problem. First
of all, with respect to the comment made
in testimony by Mr. Brady that the ad-
ministration of the export control sys-
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tem is a total shambles, I have talked
to Mr. Brady. I know that he was very
dissatisfied with the way the system was
being operated, but that is not to say
that he is critical from the point of view
that items of critical technology have
been exported to the Communist coun-
tries. His criticism had much more to do
with the way in which the program was
being administered, and I think many of
his criticisms would be shared by
industry.
The witnesses who came before us
from industry complained that they were
being subjected to inordinate delays in
the processing of their applications, fre-
quently being held up for a year or 18
months, long enough to lose their busi-
ness to a competitor in Western Europe,
and then finally having their licenses
granted. This was enough to drive many
of these exporters right up the wall.
They would agree that the administra-
tion of the program was in a total
shambles.
The effort of this bill is to tighten
up on that administration, to improve it
without in any way endangering the na-
tional security.
Now as to the Kama River plant, I
have inserted in my remarks the letter
from the Secretary of Commerce with
respect to that plant. The fact of the
matter is, and I think it is of interest to
the Members because there has been a
great deal of discussion on this, this is
a huge truck plant that makes trucks
and motors, but they are standard trucks,
and the only confirmed information that
we have about the use of the products
of that plant for military purposes is
that some of these standard trucks have
been seen in military motor pools. When
these export licenses were granted, and
they were granted in the administration
of President Nixon with the explicit ap-
proval of Secretary Kissinger, there were
no restrictions put on the use of the
trucks being produced at the plant. That
was a deliberate decision because these
were of a general nature. When you sell
anything, when you sell common tools,
a hammer or screwdriver, to the Soviet
Union, it can find its way to the military.
It can be put to military use. But it is
not correct to say that there has been
diversion or violation of an agreement,
because there was-no condition put on
the export licenses of that machinery.
Mr. ICHORD. Mr. Chairman, will the
gentleman yield for a question on that
point?
Mr. BINGHAM. I yield to the gentle-
man from Missouri.
Mr. ICHORD. I thank the gentleman
for yielding. Is the distinguished gentle-
man from New York telling this House
that the Kama River truck plant is not
being used to produce military trucks for
the Soviet Armed Forces? .
Mr. BINGHAM. The information that
we have is that they are producing
? standard trucks, which are the same for
military as for civilian use, and that
some of those trucks have been seen in
military motor pools. I am also saying
that there was no diversion because there
was no restraint in the licenses that
were granted. There was no restraint on
the end use of the products. The only
item that was sold to the Kama River
plant that was subject to the restraint
was the computer that the gentleman
referred to, and there is no evidence that
that computer has been used contrary to
the agreements that were connected with
it, which had to do with the quantity of
work to be produced by the computer,
not with the end use of the products
of the plant.
The CHAIRMAN. The time of the gen-
tleman has expired.
^ 1550
Mr. LAGOMARSINO. Mr. Chairman,
I yield 2 minutes to the gentleman from
Missouri (Mr. ICHORD).
Mr. ICHORD. I thank the gentleman
for yielding, Mn Chairman.
If I could have the attention of the
chairman of the subcommittee, I do not
know whether the gentleman answered
the question or not. I respectfully submit
that the gentleman did not answer the
question asked.
Is the gentleman telling this House
that the Kama River truck plant is not
manufacturing Soviet military trucks?
Mr. BINGHAM. I cannot answer the
question as put. They are standard
trucks which have been used for mili-
tary purposes. We knew that all along.
There was no surprise here. We knew all
along these trucks could be so used.
Mr. ICHORD. If I could reclaim my
time, I might say to the Members of
the House there is some question as to
whether they are strictly military trucks.
I do have intelligence information, and
will probably pursue this in hearings with
the Commerce Department tomorrow
morning.
The gentleman uses the term "stand-
ard trucks." Those standard trucks are
being supplied to the Soviet and Warsaw
Pact military forces.
With all due respect to the gentleman
from New York, I think you are dealing
simply in rhetoric when you say there
was no diversion. It may well have been
that the Department of Commerce did
not put the proper end-use restrictions
on the computers and all of the machin-
ery in the Kama River truck factory, but
the absence of adequate safeguards is the
reason why the acting director, Mr.
Brady, stated that the export program is
in a total shambles. I would say to the
gentleman from New York that Mr.
Brady testified specifically on the control
of military technology and the ineffec-
tiveness of end-use statements.
The CHAIRMAN. The time of the gen-
tleman has expired.
Mr. LAGOMARSINO. Mr. Chairman,
I yield 1 additional minute to the gentle-
man from Missouri (Mr. ICHORD).
Mr. ICHORD. Mr. Chairman, I would
yield to the gentleman from New York
for a comment on the remarks I made.
Mr. BINGHAM. One comment I would
make is that the licenses In question were
issued in the early 1970's. I do not know
whether Mr. Brady was even there at
that time but he certainly did not make
his comments about the inadequacy of
the present administration in terms of
something that happened back in 1970
under the Nixon administration.
Mr. ICHORD. Let me say to the gen-
H 6417
tleman from New York, Mr. Brady was',
not confining his assessment to this ad-
ministration. His remarks were' made
with regard to this administration, the
preceding administration and the admin-
istration before that. He was not singling
out the Carter administration. I think
the administration of export controls-has
been in a shambles for a long period of
time and I agree with the gentleman
from New York we have to reach a proper
balance.
I do not think you can stop the export
of all technology to the Soviet Union but
I think you can delay, Mr. Chairman, the
export of technology. That is the only
lead we have, technology. We certainly
have no lead in conventional military
capability.
The CHAIRMAN. The time of the
gentleman has expired.
Mr. LAGOMARSINO. Mr. Chairman,
I yield myself such time as I may con-
sume.
Mr. Chairman, I would like to respond
briefly to some of the comments that
were may by the gentleman from Illi-
nois (Mr. DERWINSKI) and the gentle-
man from Texas (Mr. ROBERTS) about
the McKinney-Wolpe amendments re-
garding the export of Alaskan oil.
Although the McKinney-Wolpe
amendments in the bill make it very,
very difficult, there is no doubt about
that, to export Alaskan oil, they do not
make it impossible. They set up a stand-
ard and a test that must be followed to
do that. One of the things the gentle-
man from Illinois said was that con-
sumers would suffer if the amendments
prevailed. If it can be proven that con-
sumers will come out ahead then the
provisions of the bill, and of the amend-
ments, would allow the swap to be made
providing, of course, Congress can be
persuaded to go along with that idea.
This is a hard test to follow, I will
grant you that, but it is not impossible.
Also, Mr. Chairman, the gentleman
from Illinois (Mr. DERWINsia) said if
we make a swap with Mexico, between
Mexico and Japan, that it would help
our balance of trade with Mexico. It cer-
tainly would. We would show a plus on
the oil export sales to them, we would
show a corresponding decrease, though.
In the oil we bought from somebody
else, whether it is Mexico, Indonesia or
whoever. I must also say I believe It
would set back our efforts to reach real
trade adjustments with Japan by quite
a bit because the pressure would be
taken off of them to buy others of our
imports, such things as agricultural
products and other things that we have
been trying to get them to buy more of.
I am sure there will be a debate about
this particular matter when we get into
the 5-minute rule but I did want to make
plain what were my thoughts about this
comment.
Mr. Chairman, I yield back the bal-
ance of my time.
? Mr. HEFTEL. Mr. Chairman, at a
time when we are encouraging use of
domestic oil-to reduce our dependence
on foreign imports, ease our shortages,
and to assist in restoring our outrageous
balance-of-payments problem, a refin-
ing company in Hawaii is unable to effi-
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CONGRESSIONAL RECORD- HOUSE Duty 23, 1979
Washington (Mr. BoNSER), the author
of the amendment, over the plight of the
small timber mill operator in our State.
Section 110 is, however, only one ap-
proach to the extraordinarily complex
and highly controversial problems asso-
ciated with maintaining an adequate
timber supply to support the mill opera-
tions that are the backbone of the econ-
omy in many of the small communities
in the State of Washington and the
Pacific Northwest.
I am concerned that the approach sug-
gested in section 110 may have certain
consequences that could prove to be
damaging to the Nation as a whole. I
am particularly disturbed over the possi-
bility that this language will be used as
a precedent to place absolute prohibi-
tions in statutory language on other
commodities. This seems to run contrary
to this administration's overall efforts
to develop foreign markets for our agri-
cultural and forestry resources. History
indicates that once a foreign market is
lost it-is extremely difficult to regain.
I want to indicate to the House that
I am perfectly willing to go along with
the committee on this section of the bill
as reported. I do not feel, however, that
this approach should be extended be-
yond the narrow scope of section 110.
It is important, as I see it, that Con-
gress proceed very cautiously in. this
area so that the markets for our agri-
cultural and forest products can be
maintained and enhanced as a means of
ciently,utilize domestic crude oil since a
byproduct of the refining process results
in high sulphur residual fuel oil, a pro-
duct for which no readily available.mar-
ket exists.
The refining company, which has his-
torically processed 100 percent imported
crude oil, has been seeking Alaskan crude
oil to use in a projected expansion of its
refinery capacity. The use of Alaskan
crude oil in the expanded portion of this
refinery would stimulate the use of
domestic oil in Hawaii, which has been
almost 90 percent dependent upon for-
eign sources for its crude oil.
Hawaii has a heavy demand for trans-
portation fuels (jet fuel, gasoline, and
diesel fuel) for its tourist-oriented econ-
omy and has minimal needs for residual
fuel oil. The fuel balance situation in
Hawaii is further compounded by the
military needs for the same light-end
transportation fuels. The refineries in
Hawaii are unable to make a sufficient
quantity of required transportation fuels
without producing an excess of other
products-especially residual oil.
Due to the composition of available
Alaskan North Slope crude oil, its use in
Hawaii's refineries would result in the
production of high sulphur residual fuel
oil as a by-product of the refining proc-
ess. U.S. environmental restrictions pre-
clude the marketing of high sulphur re-
sidual oil on the west coast, therefore, the
only market available for residual fuel oil
of such a sulphur content (1.74 percent
sulphur, by weight) would be in the ex-
port market.
It is important that we successfully
stimulate production of domestic. crude
oils, provide products which meet string-
ent environmental regulations to U.S.
firms and provide additional fuels of the
types required to meet both civilian and
U.S. military defense needs, in Hawaii.
This can be accomplished by utilizing
Alaskan crude oil in incrementally in-
creased refinery capacity.
In view of this, I strongly urge that the
Department of Commerce include the
addition of "refinery by-products includ-
ing high sulphur residual fuel oil," to the
provision instructing the Department in
carrying out its responsibilities.
This would allow my State to utilize
ANS crude oil, to manufacture more of
the fuels needed in Hawaii and to dispose
of, through export, the high sulphur re-,
sidual fuel which would be a by-product
of the refining process.?
? Mr. FOLEY. Mr. Chairman, I want
to commend the distinguished, chairman
of the Committee on Foreign Affairs and
the other members of his committee for
their work in bringing this legislation to
the floor.
I am concerned, however, over the im-
plications of section 110 of the bill as re-
ported. The language of that section
provides that the Secretary. shall require
a valid license under redesignated sec-
tion 7 of the act for the export of un-
processed western red cedar logs har-
vestec from public lands and requires
phaseout of export of such logs over a
3-year period.
I want to assure the House that. I
share the concern of my colleague from
addressing the serious trade deficit re-
sulting from the importation of foreign
oil.?
The CHAIRMAN. All time has ex-
pired.
Mr. BINGHAM. Mr. Chairman, I move
that the Committee do now rise.
The motion was agreed to.
Accordingly the Committee rose; and
the Speaker pro tempore (Mr. MiRTHA)
having assumed the chair, Mr. SEIBER-
LING, Chairman of the Committee of the
Whole House on the State of the Union,
reported that that Committee, having
had under consideration the bill (H.R.
4034) to provide for continuation of au-
thority to regulate exports, and for other
purposes, had come to no resolution
thereon.
. GENERAL LEAVE
Mr. BINGHAM. Mr. Speaker, I ask
unanimous consent that all Members
may have 5 legislative days in which to
revise and extend their remarks and to
include extraneous matter on the bill
just considered, H.R. 4034.
The SPEAKER pro tempore. Is there
objection to the request of the gentleman
from New York?
There was no objection.
NURSE TRAINING AMENDMENTS OF
1979
Mr. 'WAX112AN. Mr. Speaker, I move
that the House resolve itself into the
Committee of the Whole House on the
State of the Union for the Consideration
of the bill (H.R. 3633) to amend title
VIII of the Public Health Service Act to
extend for 1 fiscal year the program of
assistance for nurse training, and for
other purposes.
The SPEAKER pro tempore. The ques-
tion is on the motion offered by the gen-
tleman from California (Mr. WAXMAN).
The motion was agreed to.
IN THE COMMITTEE OF THE WHOLE
Accordingly the House resolved itself
into the Committee of the Whole House
on the State of the Union for the con-
sideration of the bill, H.R. 3633, with
Mr. SEIBERLINC in the chair.
The CHAIRMAN. Pursuant to the rule,
the first reading of the bill is dispensed
with.
Under the rule, the gentleman from
California (Mr. WAXMAN) will be recog-
nized for 30 minutes, and the gentleman
from Kentucky (Mr. CARTER) will be rec-
ognized for 30 minutes.
The Chair recognizes the gentleman
from California (Mr. WAXMAN).
Mr. WAXMAN. Mr. Chairman, I yield
myself such time as I may consume.
(Mr. WAXMAN asked and was given
permission to revise and extend his re-
marks.) '
Mr. WAXMAN. Mr. Chairman, the
legislation before us today, H.R. 3633,
the Nurse Training Amendments of 1979,
as reported by the Committee on Inter-
state and Foreign Commerce, would
amend: First title VIII of the Public
Health Service Act to extend for 1 fiscal
year the programs, of assistance for
nurse training; second, title VII of the
Public Health Service Act relating to
program requirements 'for the training
of other health professions; and third,
title II of the Public Health Service Act
to provide for more efficient administra-
tion of the Commissioned Corps of the
Public Health Service.
The Nurse Training Amendments of
1979 is an important measure with bi-
partisan support indicated by the fact
that the bill is cosponsored by 12 mem-
bers of the Subcommittee on Health and
the Environment and has the over-
whelming support of both the Subcom-
mittee and the Committee on Interstate
and Foreign Commerce.
The President vetoed the Nurse Train-
ing Amendments of 1978, which passed
the House by a vote of 393 to 12. The
President, in his memorandum of dis-
approval, cited budget restraints as a
major reason for vetoing the bill. In re-
sponse to the current economic situa-
tion, the Subcommittee on Health and
the Environment reported a bill which
authorizes less than 50 percent of the
amount authorized in last year's bill for
fiscal year 1980. This sharp reduction in
authority accommodates budgetary con-
straints, without jeopardizing the nurs-
ing profession.
In general, the bill is a 1-year exten-
sion of the Nurse Training Act author-
izing appropriations at levels similar to
the current fiscal year's appropriations,
finalized by adoption of the Budget Au-
thority Rescission Act of 1979.
Among its other provisions, the bill
establishes new authority for the train-
ing of nurse anesthetists, as did the
Nurse Training Amendments of 1978;
authorizes the Secretary to increase the
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