Jim Kolbe

Mr. KOLBE

Mr. KOLBE. Mr. Speaker, I thank the gentleman for yielding me the time. Earlier the gentlewoman from California was talking about the trade deficit with China, and we will probably see a chart up here on the floor very shortly on this. There it is, sure enough that green line. Members can see the trade deficit going up. What Members will not see on that other chart is the trade deficit with the Asian tigers; that is, Taiwan, Singapore, Hong Kong, and South Korea. They won't see it because that deficit is going down. It is pretty clear there is a correlation. We have import substitution. As these countries have gotten richer, they are buying more of our expensive goods, China is producing more of the textiles and footwear and toys. As China grows richer, they too will buy more of our goods. It is important to keep that in mind. Mr. Speaker, it is clear that our relationship with China is one that is extraordinarily important, and as everybody here acknowledges, extraordinarily complex. There is no doubt we have a lot of contentious issues that surround our relationships. We just heard about some of them: Nuclear proliferation, intellectual property, political and economic freedom for the Chinese people. Mr. Speaker, no one minimizes the difficulties of those issues, but I believe today we can take a great step, perhaps the first real step in years, toward resolving some of these problems. This resolution for the first time acknowledges that most-favored-nation status for China cannot bear the entire burden of the bilateral relationship between the United States and China, and that is an important milestone. The destructive debates that we have had here, that we pursue every year over MFN, keep this Congress from addressing the serious challenges that we do face in our relations with China. MFN simply is not the right tool to do that. Complex problems are not solved through this kind of a solution. We have to continue to work for open markets for American exporters. We have to continue to push for greater cooperation on nuclear proliferation. We have to seek Chinese accession in the world trade organization to ensure that they trade fairly and in accordance with international rules, and we have to continue to fight for the right of the Chinese people to live in freedom and democracy, using every avenue and every institution that is available to us to achieve those goals. But, Mr. Speaker, cutting off MFN is not going to accomplish any one of those worthwhile goals. Denying MFN drives China into the camp of every rogue nation in the world, Iraq, Iran, Libya, opening the door to even more Chinese weapons sales to these countries, eliminating what leverage we may have on these issues. Cutting off MFN will not solve our bilateral trade problems. It will only shift the source of our Chinese imports from China to other low- cost producers such as India and Pakistan. Meanwhile, much and perhaps all of our $13 billion in exports would be lost through retaliation. This would result in the loss of many high-paying good jobs that are good for American workers. We would find ourselves locked out of the world's fastest-growing market in the world, abdicating our economic leadership in Asia to Europe and Japan. Nor would cutting off MFN help the Chinese people. As a time when we need to encourage more trade, more economic freedom, more prosperity, we would mire the Chinese people in poverty and economic chaos. Unemployment, hunger, and hopelessness is not a formula for improved human rights, only for increased repression. One only need to look at the political repressiveness of the Mao Zedong era--a period in history where countless millions of Chinese were killed--to know this is true. Today I call for the beginning of a new era in United States-Chinese relations. An era where we can move beyond this destructive yearly debate over MFN for China. The choice today is simple--do we retreat from the challenges facing United States-Chinese relations and begin an era of hostility and isolationism by denying MFN--or do we being an era of real engagement, working at every level, bilaterally and multilaterally, to solve the complex and divisive problems we face. I urge you today to make the right choice. I urge you to vote ``no'' on the resolution of disapproval.

Mr. KOLBE

Mr. KOLBE. Mr. Speaker, I thank the gentleman for yielding me the time. I rise in support of the resolution offered by the distinguished gentleman from California [Mr. Cox], my friend and the chairman of the policy committee on which I serve. Mr. Speaker, I would take some issue with some of the language that is in this resolution. I would disagree with some of the clauses. I might question whether some of the issues raised in this resolution have been substantiated. But I think the important point is that this resolution begins us down a path that we should be taking; a path we should have been taking a long time ago. That is, it specifically directs the committees of jurisdiction, the Committee on Ways and Means, the Committee on International Relations, the Committee on the Judiciary, and other committees that have jurisdiction in this area, to focus on ways in which we can change the behavior of China, to determine how we can truly begin to deal with problems of market access; to focus on the tremendous human rights abuses which we all know and which we all deplore; to deal with the problems of nuclear proliferation which threaten the security of the world; and to deal with the other regional security issues. It directs these committees to hold hearings to look for the kinds of tools, the kinds of legislation, the kinds of resolutions that can actually change China and bring them into the family of nations. What this resolution recognizes, in the context of the vote we just had, is that the MFN, the most-favored-nation trade status, is not the way to bring about those changes. Most Americans, maybe even many in this body, would be surprised that we grant MFN status to Iran, to Iraq and some of the countries that my friend, the gentleman from Illinois, Mr. Porter, mentioned: Burma, Turkey, and Sudan. All of those countries have MFN status with the United States. But what we have found is there are other ways to deal with the problems of Iran and Iraq, and we deal with them on a multilateral basis with our other allies and those using the kinds of techniques that work. We have used selective embargoes. We have worked with our partners to try to secure the kinds of changes that we want to bring about in those countries. So what we are saying here today is let us begin this process. With this resolution, we tell China we do not condone their policies, we do not accept their human rights abuses, but we do intend to begin an engagement with China on these issues that are so important to our relationship. I urge support of the Cox resolution.

Mr. KOLBE

Mr. KOLBE. Mr. Chairman, I yield 5 minutes to the gentleman from Colorado [Mr. Skaggs].

Mr. KOLBE. Mr. Chairman, we have had some considerable success in this regard. In fact, Cray has sold and installed in Japan 170 supercomputers. NEC has installed in Japan, their own country, 80 computers. In the United States, Cray has installed 320 supercomputers versus 2 for NEC and none to a Government corporation, a Government agency. Mr. Chairman, are we to suggest here tonight that we are going to deny the right of the NSF, which has looked at the bids and has decided that this is clearly the superior computer, that we are going to say, you cannot proceed with that and jeopardize all of the trade laws, all of the sales which Cray and others have made, all of the efforts we have made to open this market to our computers and to other countries and to other companies that sell in that market? I want to make it clear that the bottom line has nothing to do with whether it is Cray or NEC that gets the NSF contract. It is a process that must be followed here. There is a process for an antidumping case. The process has not been followed by the Department of Commerce, and this body is preparing to violate it in a very major way tonight. Because we are going to say, notwithstanding our procurement laws, notwithstanding the antidumping laws, and notwithstanding the WTO and, by the way, Japan will have a perfect case to take against us to the WTO and we will be sanctioned then on all computers that we try to sell in Japan, notwithstanding all that we are simply going to say that, if the Department of Commerce writes a letter, with no investigation ever conducted, that you cannot buy this computer. That violates the law. It violates the rule of law. It violates all the standard procedures, and we ought not to do it. Let us follow the procedure. We stand for the rule of law. We stand for doing the right thing. I urge my colleagues to reject this language, to support the Kolbe amendment, to reject this language and to remove it from the legislation.

Mr. KOLBE. If the gentleman will yield, that was the unanimous- consent request, 2 minutes on each side.

Mr. KOLBE. Mr. Chairman, I yield my 2 minutes to the gentleman from Illinois [Mr. Crane], the distinguished chairman of the Subcommittee on Trade of the Committee on Ways and Means.

Mr. KOLBE. Mr. Chairman, with that proviso, I ask unanimous consent to withdraw the amendment.

Mr. KOLBE. Mr. Chairman, before I proceed, I ask unanimous consent that, while they are trying to work out the issue on the other amendments, that, the gentleman from Wisconsin, [Mr. Obey] is in agreement, that all debate on this amendment and all amendments thereto be limited to 60 minutes, with the time equally divided between myself and the gentleman from Minnesota. That is pursuant, I might add, to the agreement that we had agreed to earlier in the larger unanimous consent. The Chairman. Is there objection to the request of the gentleman from Arizona?

Mr. KOLBE. Mr. Chairman, I yield myself 30 seconds. Mr. Chairman, I listened to the gentlewoman from Ohio and I assume she believes that dumping is taking place in this case. I do not know if that is a fact or not. But if it is, there is a process to be followed. You file an antidumping case, you make a determination, you make a determination of the injury, and then you impose a sanction. The sanction is an antidumping tariff. I do not understand why the gentlewoman and other people over there are not willing to follow the law, the law that we voted on, that we adopted here. Mr. Chairman, I yield 2 minutes to the gentleman from Colorado [Mr. Skaggs].

Mr. KOLBE. Mr. Chairman, I yield myself 1 minute. We talked about what this would do to our supercomputer industry, which is one company: Cray. Let me just tell my colleagues what they said in a memorandum to their own employees just a month ago in which they said, it is a Q and A kind of memorandum. Question. How much of an impact does the entire deal have on Cray financially and in terms of jobs? Answer. It is a large procurement, but we as a company do not live or die by one deal. It does not make or break our revenue goals for the year, and it does not really make a difference in employment because we do not staff up prospectively for business that is not booked yet. Mr. Chairman, this is not going to make or break Cray; they are doing very well in Japan. Let us not jeopardize the sales of computers that they have in Japan. Let us not jeopardize this with the kind of action that is being talked about here today. Let us not jeopardize this by violating our own law our law makes it clear that you can only have a sanction after there is a final determination of dumping, and then it can only be in the form of an antidumping tariff, not in terms as proposed by section 421. It violates our dumping laws, and our procurement costs.

Mr. KOLBE. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, the gentleman from Michigan [Mr. Levin] is absolutely correct. There is a problem here. He said, let us not worry about the technical aspects of this. We can correct that later. There is a problem, all right. We are violating GATT and WTO agreements, we are violating our antidumping laws, we are violating our procurement laws; just minor little details, apparently, to some people. I think these are important matters. We have a firm commitment in this country to the rule of law. We ought not to so casually and cavalierly disregard that. I would also like to respond to something that was said earlier by the gentleman from Wisconsin when he talked about the danger that we face of driving our industry out. Some danger: Cray has installed 130 supercomputers in Japan versus 80 by NEC and Fujitsu; in other words, more than 50 percent more by an American company. We are endangering that, all right. We endanger selling any more American computers in Japan if we take this kind of action, because they have a perfect recourse under the WTO to stop us, to levy fines and sanctions against us from selling computers. Another point that should be made is that Cray has installed 320 supercomputers in the United States versus 2 from NEC. Some danger that Cray is in here. The gentleman is right, we are endangering. We are endangering the U.S. industry with this action, not with the action that was taken by the National Science Foundation and its grantee, the University Corporation for Atmospheric Research, which did follow the procurement procedure exactly as they were supposed to. Finally, let me say with regard to the matter that NEC is selling at below cost, the National Science Foundation, or rather the University Corporation for Atmospheric Research [UCAR], asked for an analysis to be done by a respected law firm here in Washington on this issue. They concluded that the Department of Commerce analyzed the wrong transaction. The treaty antidumping statute applies to the sale of imported merchandise to the first U.S. party, unrelated to the exporter. It does not have anything to do with leased kinds of equipment. It also says that antidumping law provides, they concluded, that the fair value determination should be made by comparing prices for the same or similar products in the exporters' market or third country market with the U.S. price; but they conducted the type of constructed value analysis that is a method of price comparison that is invalid in this country, because of the absence of a home market or third country sales that have not been demonstrated. So even on the back-of-the-envelope analysis that was done, by Commerce and the gentleman from Colorado [Mr. Skaggs] had it exactly right, it was a back-of-the-envelope kind of thing, they said on their own that they did not want to actually initiate antidumping because they were uncomfortable. The Department of Commerce instead just sent this letter. So they violated the process that they are supposed to follow, that the industry is supposed to follow to have an antidumping case. We have an antidumping process because Members on that side of the aisle and this side of the aisle said there has to be a way from companies to deal with this when there are allegation of dumping. Well, let us follow the law. I would just say that what I am talking about here is the process. Again, there is a process to be followed. We are not following that process, and we are suggesting that we are just simply going to ignore the law. Mr. Chairman, I reserve the balance of my time.

Mr. KOLBE. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, let me just reiterate a couple of points here. There is a process that we have adopted that must be followed when we believe dumping is taking place. The process requires the industry or the Department of Commerce to initiate an antidumping case. The International Trade Commission then makes an initial determination of injury. The full investigation is then done by the Department of Commerce. It goes back to the International Trade Commission for ratification and for the imposition of an antidumping tariff. That is the process. That is the law. As the gentleman from Colorado so aptly put it, we ought not to be engaging in ad hoc changes to our entire law as it relates to procurement, dumping, and international agreements. We should not be jeopardizing our supercomputer industry. Any foreign country would have a perfect case against us when we violate the law and violate our international agreements in this fashion to block the sale of supercomputers overseas. If people believe that we should have a process of protecting ourselves, then they should adopt that process and follow it. If the process is not right, change the process. Mr. Chairman, I yield back the balance of my time.

Mr. KOLBE. Mr. Chairman, I offer an amendment.

Mr. KOLBE. If the gentleman would yield this amendment is a limitation on the National Science Foundation, which is an agency, so it clearly does go to the procurement code, to the National Science Foundation. I would also make the point that the procurement code says we must give national treatment: We cannot treat one country differently than another. This does that, it violates the WTO, it violates the procurement code.

Mr. KOLBE. Mr. Chairman, let me begin by laying out the background of this case. A few months ago, the University Corporation for Atmospheric Research, which is a part of the National Science Foundation, began to consider bids for a new supercomputer. They had been using a Cray computer, and they went through the normal procurement process, the conclusion of which was a bid an unusual bid in the amount of money that was set--$35 million--won by NEC. There is no dispute over the amount of dollars of this procurement. It is $35 million. But to continue, in the RFP that was proposed, the question was posed--what could you do for $35 million? Clearly the bid proposal from NEC, the Japanese company that makes supercomputers, was the best offer. Following that decision or that initial bid proposal, this information was conveyed to the White House. It was also conveyed to the Department of Commerce. The Department of Commerce then subsequently wrote a letter to the National Science Foundation in which they said they had investigated the matter and made a preliminary decision that there was clear dumping here. That is, NEC was selling this computer or the software for this computer, at well below cost. As a result of that letter, even though it was simply a letter and nothing more, remember no formal investigation has ever been conducted into allegations of dumping, language was added in the subcommittee and retained by the full committee, which would put in place a limitation on funds for any employee of the National Science Foundation that proceeds to sign a contract for the purchase of an NEC computer, if, there has been a preliminary or final finding of dumping on the part of the Department of Commerce. My amendment would seek to strike that language. Why do I seek to do this? Am I against Cray computers, American-made computers as opposed to Japanese computers? Of course not. The fact of the matter is, Mr. Chairman, we have a process, a process that is established in law. That process is that an antidumping procedure may be initiated if dumping is believed to have occurred. Almost always it is initiated by the industry. But it can be self- initiated by the Department of Commerce. That is rarely done and has not been done in this case. In fact, there has been no initiation of an antidumping case on the part of the Department of Commerce regarding this procurement. The Department of Commerce simply on their own wrote a letter which bypassed this internationally recognized procedure and simply said, we think there is dumping going on here. The law is very clear. If Commerce decides to initiate a dumping procedure, they then send that inquiry to the International Trade Commission. The International Trade Commission then decides on an initial basis, if injury has been done. They then send it back to the Department of Commerce to determine the amount of the damages and injury that has been done, or whether injury has occurred. The International Trade Commission then makes a decision as to the extent of the damages, and the final result is that a sanction may be applied. The only sanction under the law, and I would hope that this body cares a little bit about following the law, the only sanction under the law is that a tariff may be applied against the company that is dumping, the industry which is dumping, in this case against NEC. It is very clear, and in fact our trade laws make it very precise, that we do not link procurement with dumping laws because that violates the international agreements that we have, World Trade Organization agreements. We do not link the procurement process with dumping. So it is against the law for us to unilaterally impose punitive measures and say, you cannot go ahead and buy this computer. If indeed the NSF proceeded to buy this computer and it was found that there was dumping, a tariff may be applied in the future, against any other computers that are bought. That is the background of this case. In essence, the action of the subcommittee of adding this language violates our procurement laws. It violates our antidumping law and it violates WTO agreements. We have made a big thing in this country, and I hope in this body, about the rule of law. We have tried to get other countries to follow the law. We have tried to get those countries to follow the law so that they would abide by the rule of law. We have made a big case about getting Japan to open its market to computers, and we have had some success.

Mr. KOLBE. Mr. Chairman, I yield 4 minutes to the gentleman from California [Mr. Campbell]. (Mr. CAMPBELL asked and was given permission to revise and extend his remarks.)

Mr. KOLBE. Mr. Chairman, will the gentleman yield?

Mr. KOLBE. Mr. Chairman, I would just ask the gentleman from California [Mr. Lewis] to enter into a colloquy. I think the gentleman has heard the very legitimate concerns that have been expressed about the possibility of antidumping. The gentleman has also heard the concerns on this side about the possible violations of law that may be involved here on the possible changes to our law. I am just wondering if the gentleman can assure me that if this issue gets into the conference that this will be considered very carefully in the context of what might be done by the Senate and with the debate that has taken place here today.

Mr. KOLBE

Mr. KOLBE. Mr. Speaker, I thank the gentleman for yielding me this time and for introducing this resolution. I join with my colleagues in sending our condolences and love to Jo Ann and the entire Emerson family. Much has been said here today about the selfless individual that served among us as the Representative from Missouri. There are two things I would just like to remember with my colleagues about him that stand out for me. Eight months ago, when we were considering whether or not we should continue the Select Committee on Hunger, Bill Emerson asked me to go to lunch with him and a couple of staff people. He wanted to talk about this, just one-on-one, to talk about the passion he felt for that select committee and the work that it was doing. I did not have to ask him, ``Bill, why are you doing this; what is in it for you?'' I knew there was nothing in it for him, but I knew how much he believed in it; that he took the time to meet with Members one by one to talk to them about this. The other thing was his service as chairman of the page board. I had the privilege these last 2 years of serving with him on the page board. Like him, I started here as a page, though in the other body. Like him, I loved this institution of Congress. Bill Emerson loved the institution of Congress that he started serving at such a young age, but he also loved the pages. He loved the young people that worked in that program. He took the time to talk to them. He took the time to understand what the program was about and how important it was. Just 3 weeks ago when the group of pages that had served us for this last year left, he came to the floor. He wanted so much to lead the tribute to the pages, but he was taking oxygen, he was in a wheelchair. And he said: Jim, would you take this 5-minute special order to do this? He said: I really want to do it, but I just cannot. But he stayed here on the floor. He listened to what was being said because he really cared about it, and he put his remarks in the Record so that they would appear there. Bill ended his life as he lived it, with courage, with love, and with caring. Sometimes we have to have a sad event like this to remind us that this body is not about Republicans or Democrats, conservatives or liberals, urban or rural, northerners, southerners. It is about people, flesh and blood who love and laugh and cry and hope and grieve. Bill's life demonstrated that, and his leaving reminds us of it.

Mr. KOLBE

Mr. KOLBE. Mr. Chairman, I yield 2 minutes to the gentleman from California [Mr. Herger].

Mr. KOLBE. Mr. Speaker, I demand a separate vote on the so-called Kennedy of Massachusetts amendment.

Mr. KOLBE. I thank the gentleman for yielding time. Mr. Chairman, I appreciate the comments I have heard about we can surely find 2 pennies of waste, and reduce this bill by 1.9 percent across-the-board. I have been there, I have offered these amendments on the floor before on appropriation bills. But I would point out that when I offered those amendments, it was in years when we were increasing appropriations by 3 percent, 5 percent, as much as 7, 8, or 10 percent. We heard about a 1.9-percent cut, that anybody should be able to do that. But, Mr. Chairman, we have cut this bill by 12 percent in the last 2 years. Let me repeat that: We've made a 12-percent reduction. The last speaker just talked about how there is an individual, a doctor working for a Federal agency. I read that article, about the doctor who is getting paid for doing no work. Does anybody think that by cutting 1.9 percent we are going to solve that problem? No, we have got to go in and change the law, the Federal employment laws. We have got to make it possible for managers to fire people, to get rid of people that are deadwood, to do what managers are supposed to do. That is the basic problem we have got. We have to change a lot of other laws to get the systemic changes we need. It is not just about changing or reducing the level of funding. This is not the answer. We have made cuts. Twelve percent we have reduced this bill, $500 million this year alone. Look at how the parks have gone up in the number of visitors. Does anybody believe that we do not need to provide for those crown jewels of our national heritage? We do, and we need to have the funds for that. I urge a ``no'' vote.

Mr. KOLBE. Mr. Chairman, the gentleman from Oklahoma [Mr. Istook] has raised an important issue, and I think we have had a good discussion on the floor today. The Indian tribes, under the treaties and agreements that they have with the United States, have been given the right of self-government within their own territory. Each tribe has a somewhat different arrangement, but in a very significant way the Istook amendment turns this on its head. Under the guise of tax fairness, the Istook amendment would give State and local governments the ability to restrict placement of land in trust status for tribes, but the reality of this provision is that it precludes any economic development Indian tribes would want to pursue on these lands unless it is approved by State and local governments. This flies in the face of every agreement, every commitment we have made with tribal leaders. Each of these treaties is a little bit like the enabling acts that brought our States into the union. They are the basic governing law, and we should not with this amendment on an appropriation bill make such a fundamental change to those enabling acts or to those treaties. Another point that needs to be made is that under the Istook amendment there is no requirement or assumption that States and local governments have to negotiate in good faith. In other words, simply stated, the States have a veto power over the Indian tribes' future. Subjecting sovereign Indian tribes to the whims of State and local government officials is not in accord with prevailing Federal Indian law and policy. It violates the principles of fairness, it violates the principles of the United States Government. This amendment stands 200 years of Indian law on its head. It does so without hearing, without consultation or input from the tribes, without tax law experts, without understanding the possible ramifications of this major change to Indian law. My colleagues, the Istook amendment is an unfortunate attempt to undermine Indian ability to govern themselves and achieve economic self-sufficiency. We should defeat this amendment.

Mr. KOLBE. Mr. Chairman, I yield 2 minutes to the gentleman from Alaska [Mr. Young].

Mr. KOLBE. I yield to the gentleman from California.