Larry Pressler

Mr. PRESSLER

Mr. PRESSLER. Yes, it does in all respects. As chairman of the Committee on Commerce, Science, and Transportation, I recognize that the issues addressed in the OPA-90 amendment clearly fall under the jurisdiction of the Committee on Environment and Public Works. I have appreciated the willingness of the chairman of that Committee to work with the Committee on Commerce, Science, and Transportation so this amendment could be added to the Coast Guard reauthorization bill.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, on many occasions I have taken the floor to talk about agriculture in South Dakota. The wonders of American agriculture tell a story that is not told often enough. Individual initiative and determined efforts have led to scientific discoveries that advanced agriculture. The inspirational strength of family, loyalty and faith also have contributed to the wonder that is American agriculture. In no American workplace is there found greater productivity, cooperation, neighborly concern, creative use of applied science, hard work, and independence than on the farm and ranch. It gives me great pride to witness the ability of our farmers and ranchers to provide abundant and high quality food and fiber for all our citizens and millions of others throughout the world. The story of American farmers and ranchers is truly a wonder of the modern world. There is the story of Richard Ekstrum of Kimball, SD. This week Richard will be stepping down as President of the South Dakota Farm Bureau. He has held that position since he [[Page S 17181]] was first elected to it in 1975. Richard's leadership has helped to shape the vigorous South Dakota livestock industry. His accomplishments are many, too many to list here. But for those of us who know him, it is agreed that his boots will be hard to fill. Richard Ekstrum has provided me with invaluable advice and counsel throughout my years in the House and Senate. He has been a tireless defender and promoter of South Dakota and American agriculture. After each meeting with him I know exactly what needs to be done. All meetings with him are productive. I will miss his regular advice and leadership, but I am heartened to know he is still just a phone call away. Richard recently was quoted as saying, ``I will always be part of Farm Bureau and Farm Bureau will always be a part of me.'' Similarly, I would like the Record to reflect that Richard Ekstrum will always be a part of South Dakota agriculture, and vice versa. Richard owns and operates a 3,500 acre general livestock and grain farm near Kimball, SD. He and his two brothers operate this farm, which has a commercial farrow-to-finish hog operation and produces purebred Simmental cattle. Richard first joined Farm Bureau in 1967 and rose through the ranks of the Brule County Farm Bureau organization to become President of the South Dakota Farm Bureau in 1975. He was elected in 1980 to the Board of Directors of the American Farm Bureau Federation, a position he held for a decade. He has travelled the globe--28 countries in total--to promote and advance American agriculture. He recognizes that the continued strength of American agriculture rests with its ability to compete in the world market place. That is part of the reason why Richard Ekstrum is a recognized and respected national leader in agriculture. The strength of the Farm Bureau organization is rooted on the farm. The history of the South Dakota Farm Bureau is impressive. As early as 1913, several county Farm Bureaus were organized and operating in South Dakota. In 1917, the operating county Farm Bureaus formed the South Dakota Farm Bureau Federation. Today the South Dakota Farm Bureau is my State's leading agricultural organization and a highly regarded voice for South Dakota farmers and ranchers. Much of the success of the South Dakota Farm Bureau can be attributed to Richard Ekstrum. Under his leadership the organization witnessed its largest membership growth. Throughout the 1950's and 1960's, membership averaged 3,100 farm families. During the 1970's, its programs were expanded and since 1977 family membership in the South Dakota Farm Bureau has grown each and every year to the point where it represents more than 10,000 South Dakota farm and ranch families. One of the many programs sponsored by the farm bureau and strongly promoted by Richard is the South Dakota Farm Bureau Young Farmers and Ranchers Committee. This group provides opportunities for greater participation by young, active farmers and ranchers. It helps young farm bureau members analyze their particular agricultural problems and collectively find solutions that best meet their needs. I am very pleased with the success of this program. I have said on many occasions that we need to do more to promote the promise of farming for younger generations. These young people represent the future of South Dakota agriculture. Richard Ekstrum and the South Dakota Farm Bureau are committed to the goal of improving net farm income and strengthening the quality of rural life. I commend Richard for his loyalty to and hard work for the South Dakota Farm Bureau. He has left his mark on the landscape of South Dakota agriculture and his community. His wife Agnes and his two daughters can be truly proud. I know Richard will continue to be active in his church, in civic and private organizations, the South Dakota Farm Bureau and in South Dakota agriculture. Richard is known for saying, ``Of all the hats that I wear, I like the one of being a farmer the best.'' Today, on behalf of all South Dakotans, I take my hat off to Richard Ekstrum. As I stated before, the wonders of American agriculture tell a story that is not told often enough. It is a story of proud Americans, like Richard Ekstrum, who do their part in the world's most proficient industry, day after day. I enjoyed and will continue to tell the many stories of South Dakota men and women who contribute to the greatest story ever told--American agriculture.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, in Washington, we are facing a crisis. It is not just a crisis of a Government shutdown, but it is the crisis of what direction we shall go as a nation regarding a balanced budget. It is my strongest opinion that the liberals are standing in the way of a balanced budget. I always tell high school audiences that they should decide if they are liberal or conservative. If they are more liberal, they probably should join the liberal wing of the Democratic Party. If they are more conservative, they probably should join the Republican Party. Let us face it, there are two cultures clashing here. One is the traditional liberal culture of big government; the other is the effort to have less government, lower taxes, less regulation, and the two cultures have clashed here in this balanced budget debate. It has been my opinion that there has been shameless waste in many Federal Government spending programs--shameless waste. There has been waste, fraud, and abuse, and the American people want our Federal Government to become more efficient. They want to take care of the poor, they want to take care of the Medicaid and Medicare people and, indeed, our budget does take care of them. We are a compassionate people in that we certainly will not abandon the poor and the elderly. But our people want us to be more efficient in the use of Federal dollars. Working middle-class families have felt that they are left out of the system. A lot of families, or a lot of people, are what are called working middle class. They do not get a lot of the tax breaks. They are required to pull the wagon, so to speak. There is a revolt across the country of these working middle-class families and their children, because they feel that if we do not move toward a balanced budget, they will have to pay higher taxes and their children will have to pay higher taxes. I tell all of the high school graduating classes that I talk to that they will have to pay between 3 and 5 percent additional taxes all their lives because of the debt that this country has. In my State of South Dakota, we primarily have working middle-class people, and they are the ones who drive us to stick together to get this budget passed that will bring us to a balanced budget in the year 2002. I feel passionately that we must give the dream of America back to our children. I feel that this budget is the most important single piece of legislation, because if we fail, we will be continuing the same habits of deficit spending that has gotten us this huge debt. At some point, we have to stop, and we have reached that point. In my State of South Dakota, our field offices have received an overwhelming number of calls that indicate that our people want us to continue; our people do not want us to compromise the balanced-budget principle; our people want us to take the steps. So we have cast many of those difficult votes this year. I hope our leadership does not compromise. I know that all parties are acting in what they believe to be the national interest. But I think realistically and actually what is happening is that the liberal traditional approach to Government is clashing with what came out of the 1994 elections, and that is a fiscally conservative approach to Government. Those two forces are now clashing, and the working middle- class families of America are watching to see if we have a resolve to continue to move toward a balanced budget by 2002. I urge our leadership to continue that effort. Ms. MIKULSKI addressed the Chair.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I ask unanimous consent to speak for 5 minutes as in morning business.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I rise today to discuss existing and emerging air service opportunities on the European Continent for U.S. passenger and cargo carriers. These opportunities include not only serving destinations within Europe, but also points beyond such as the Middle East and Asia-Pacific markets. As the British continue to refuse to open their skies to our carriers, developments in other countries represent alternatives that are increasingly attractive and are taking on greater significance. Unfortunately, recent negotiations with the United Kingdom seeking to liberalize our air service relationship with that country have hit an impasse. At this time, it is unclear whether that impasse is insurmountable. As is often the case with the British, the primary sticking point is our request for greater access to London Heathrow Airport, the main hub of British Airways. Access to Heathrow is particularly important to our carriers since it is an international gateway airport offering connecting service opportunities beyond the United Kingdom to markets virtually worldwide. Another key and often overlooked area of disagreement is our request for full liberalization of air cargo services between and, importantly, beyond our two countries. Currently, the ability of our cargo carriers to serve the United Kingdom, load additional freight there, and fly on to other countries is severely limited by the United States-United Kingdom bilateral aviation agreement. British negotiators continue to reject our requests for fully liberalized air cargo opportunities, despite a March 1994 recommendation by the House of Commons Transport Committee to that effect. What does all this mean? The answer to that question is contained in the insights of one aviation authority who wrote recently ``[a]irlines and passengers are free agents. If extra capacity is not developed at Heathrow, the airport will not be able to satisfy demand and airlines will expand their business at continental airports.'' The author added ``if airlines are denied the opportunity to grow at Heathrow, many will choose Paris, Frankfurt, or Amsterdam.'' Mr. President, this is not rhetoric. It is not a threat by U.S. interests designed to gain negotiating leverage. To the contrary, the author of these quotes is BAA plc, the British company that owns and operates Heathrow as well as other United Kingdom airports. BAA is very perceptive. Obviously, BAA recognizes that in today's global economy the long-term consequence of protecting one's air service market amounts to little more than the stimulation of competitive opportunities elsewhere. One need only look across the English Channel to continental Europe to confirm that already is taking place. There was a time when geographic factors and the limited range of commercial aircraft made the United Kingdom the international gateway of necessity for United States carriers serving Europe and beyond. Times have changed. New generation long-range aircraft have made the option of overflying the United Kingdom viable from both an operational and economic standpoint. Simply put, if the British do not want the business of our air carriers, United States carriers can and will look to the European Continent for new gateway airport opportunities. Today, I wish to discuss a few of these existing, emerging, and potential air service opportunities. First, there is tremendous growth in international passenger traffic at Amsterdam's Schiphol Airport. This is [[Page S 16802]] due, in large part, to the successful alliance between Northwest Airlines and KLM Royal Dutch Airlines, and clearly demonstrates BAA's prediction already is coming to pass. How did it happen? Recognizing the significant mutual benefits that result from free trade among nations, in 1992 the Netherlands signed an open-skies agreement with the United States. That agreement permits the marketplace, not Government restrictions, to determine air service between the two countries. The results speak very loudly. Between 1992 and 1994, total passenger traffic between the United States and the Netherlands grew an astounding 56 percent while total passenger traffic between the United States and the United Kingdom grew just 7.5 percent. In 1992, 18.6 million international passengers arrived and departed from Schiphol. By 1994, that number grew to 22.9 million passengers--an increase of more than 23 percent. It is anticipated this growth will continue with nearly 28 million international passengers using Schiphol by 2000. What does this illustrate? Among other things, it clearly demonstrates Schiphol is drawing passenger traffic originating in the United States away from United Kingdom airports, particularly Heathrow. Cargo opportunities also are booming at Schiphol. In 1992, nearly 725,000 metric tons of international cargo were loaded and unloaded at the airport. By 1994, that number grew to 838,127 metric tons, an increase of nearly 12 percent. By the year 2000, it is estimated 1.2 million metric tons of international air cargo will pass through Schiphol. Consistent with that forward-looking view of aviation relations, the Dutch also have in place a long-term airport growth plan to enable Schiphol to accommodate the rapidly expanding traffic the United States-Netherlands open skies has spurred. The goal is no less than making Schiphol one of the major European hubs for intercontinental passenger and cargo traffic. By the year 2015, that plan calls for Schiphol to have the capacity to serve up to approximately 56 million passengers and 4 million metric tons of cargo annually. Mr. President, the Dutch clearly want the business of United States carriers. Based on the growth of international passenger and cargo traffic at Schiphol, it is clear U.S. carriers are responding to this message. Second, our recently completed nine-nation European open-skies initiative should stimulate additional new continental gateway airport opportunities. The nine European countries with which the United States recently signed open-skies agreements are Austria, Belgium, Denmark, Finland, Iceland, Luxembourg, Norway, Sweden, and Switzerland. Brussels Zaventem Airport illustrates my point well. Even before the United States-Belgium open-skies agreement was signed a few months ago, international passenger and cargo growth at Brussels Airport was impressive. For instance, between 1993 and 1994 international passenger traffic grew to more than 11 million, a 12-percent increase. During the same period, international freight passing through Brussels Airport rose a remarkable 24 percent to more than 380,568 metric tons. No question, Brussels Airport is emerging as an important European gateway airport for intercontinental traffic. The recent open-skies agreement should cause existing growth to accelerate. To ensure this comes to pass, the Belgians recently expanded Brussels Airport to put it in a position to fully capitalize on new service opportunities. Earlier this year, a new terminal opened at Brussels Airport which has more than doubled the airport's capacity from 10.5 to 21 million passengers annually. This terminal expansion initiative, coupled with significant runway capacity, will make Brussels very attractive to U.S. carriers. Indeed, a number of U.S. passenger carriers already provide nonstop service from the United States to Brussels. Delta Air Lines, through its code-sharing alliance with the Belgian national carrier Sabena, also provides nonstop service from key United States gateway cities including New York, Boston, and Chicago. One clear indication the United States-Belgium open-skies agreement will be a catalyst for increased transatlantic service from the United States to Belgium appeared in a recently filed application by Delta seeking antitrust immunity for its alliances with Sabena as well as Swissair and Austrian Airlines. In that filing, Delta indicated it plans no less than to use the Delta-Sabena alliance to make Brussels Airport one of a multihub network in continental Europe. No wonder, Brussels Airport is regarded as Europe's only true hub-and-spoke operation. Third, a potentially tremendous opportunity for United States carriers may soon emerge in Germany. The United States and Germany commenced air service negotiations in July which I very much hope will result in an open-skies agreement. It is my understanding those talks are progressing well. What would an open-skies agreement with Germany mean for United States carriers? In short, it would mean significant new air service opportunities for our carriers between the United States and Germany. Equally important, German airports would provide well-situated gateway opportunities for our carriers to serve points beyond Germany such as the booming Asia-Pacific market. One such opportunity is the airport in Frankfurt which already is being used by some U.S. carriers as an alternative to Heathrow. Frankfurt-Main Airport's ideal location in Europe already has fueled tremendous growth for that facility. As a matter of fact, it already ranks as the second busiest airport in Europe next to Heathrow. Last year, for instance, 27.6 million international passengers passed through Frankfurt as well as more than 1.2 million metric tons of air freight. Each total represented nearly a 10-percent increase over 1993 traffic levels. Frankfurt Airport is not resting on its laurels. In fact, the Germans have ambitious plans to ensure Frankfurt Airport can meet rapidly expanding demand. Last year, a new terminal complex was completed which enables the airport to handle an additional 12 million passengers annually. In addition, the runways at Frankfurt Airport already have the capacity to handle nearly as many aircraft movements per hour as those at Heathrow. By the year 2010, forecasts indicate Frankfurt Airport will handle approximately 53 million passengers. As far as air cargo is concerned, new freight facilities are expected to more than double air cargo passing through Frankfurt from its current level of 1.2 million metric tons. Unquestionably--particularly under an open-skies regime-- Frankfurt represents an attractive option for U.S. carriers who are frustrated by their inability to gain or expand access at Heathrow. There also are other important air service opportunities elsewhere in Germany. Last year, 8.3 million international passengers passed through the airport in Munich. Plans by Lufthansa to make Munich its second largest hub, including using it as a gateway for some Asia-Pacific service, should spur additional international passenger growth at the airport. An additional option is Dusseldorf's Rhine-Ruhr Airport which last year served 10.3 million international passengers. A United States-Germany open-skies agreement undoubtedly will foster additional growth in the number of international passengers using the airports in Frankfurt, Munich, and Dusseldorf. Also, it could accelerate construction of a planned new airport in Berlin. The new Berlin-Brandenburg airport would offer yet another gateway opportunity for U.S. carriers. Mr. President, as I have said on other occasions in statements to this body, we must continue pressing for a liberalized air service agreement with the United Kingdom. We owe that to consumers on both sides of the Atlantic who unquestionably would be the biggest winners if such an agreement were reached. Concurrently, however, I believe we should intensify our efforts to secure an open skies agreement with Germany. In combination with existing and emerging opportunities for United States carriers in continental Europe, such an agreement would put tremendous competitive pressure on the British to open Heathrow to United States carriers. Moreover, if the British doubt that the restrictive United States- United Kingdom bilateral agreement is forcing United States carriers to [[Page S 16803]] overfly the United Kingdom to European continental airports, an open- skies agreement with Germany that furthers the exodus of United States flights to the continent would dramatically make this point. If Britain does not want our business, clearly there are other nations who do. Mr. President, may I proceed for 2 more minutes on the same subject?

Mr. PRESSLER. Mr. President, to summarize what I have said, as a chairman of the Commerce Committee and a member of the Aviation Subcommittee, I am very eager to see us move forward on efforts to liberalize our bilateral aviation agreement with the United Kingdom. I am very concerned about the problem of access to Heathrow and resulting limitations on the ability of our carriers to serve markets beyond the United Kingdom. Also, I am disturbed by British restrictions on the beyond rights of our cargo carriers. Similarly, I am also concerned about attempts by the Government of Japan to prevent our carriers from fully participating in the booming Asia-Pacific market beyond Tokyo. Very frankly, what these countries try to do is they have a system to block out U.S. passenger and cargo carriers as well as to prevent our carriers from serving beyond markets. I believe we should put the emphasis on jumping over Heathrow if the British are unwilling to cooperate by opening their skies to United States carriers. I have urged our Secretary of Transportation, Secretary Pena, who I think does a good job in international aviation negotiations, to treat international aviation as a trade issue and to focus on maximizing economic benefits for our country. I understand this is very difficult for Secretary Pena to do since each time he attempts to follow this course, a group of Senators and Representatives who represent a certain airline criticize what he is doing. We have to support our Secretary of Transportation when he is trying to negotiate these difficult agreements. We need to put the interests of the U.S. economy first. The situation with the British is very frustrating and unacceptable. Britain is dragging its feet on liberalizing our air service agreement. They are stalling. I think we should make it very clear to the British if they continue to severely restrict opportunities for our carriers to serve the United Kingdom and points beyond, United States passenger and cargo carriers will turn to Germany and Amsterdam and other points in Europe. I would hope that continued progress in liberalizing our aviation relations with countries in continental Europe, and the continued exodus of United States carriers to capitalize on these opportunities, will drive home this point. Simply put, our carriers are not being treated fairly by the British. Unfortunately, the same is true in Japan where the Government of Japan is trying to prevent our carriers from fully participating in the rapidly expanding Asia-Pacific market. I hope our Secretary of Transportation stands firm with the British and the Japanese. I support him, and I urge the Members of this body to do so. He is doing a good job in international aviation matters under difficult circumstances. Mr. LEAHY addressed the Chair.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded, that I be allowed to speak for 5 minutes as if in morning business, and that the business of the Senate will then return to a quorum call and to its present state.

Mr. PRESSLER. It is nothing about the pending bill.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, today I pay tribute to Dorothy Hustead, the woman who helped put Wall Drug on maps all over the world. Dorothy, who recently passed away, was a charming and pleasant woman who inspired many people. Dorothy was a South Dakota legend in her own time. She took great pride in her work, her family, her community, and her faith. She was an example of the commonsense values that are typical of a true South Dakotan. It was Dorothy Hustead who invented the famous ``free ice water'' slogan that helped transform a small, struggling drugstore in the geographical center of nowhere into one of South Dakota's top tourist attractions, drawing 15,000 to 20,000 people a day during the busy summer months. The Hustead Drugstore, better known simply as Wall Drug, officially opened on December 31, 1931. On a hot Sunday afternoon in July 1936, Dorothy came up with the idea to use highway signs to advertise free ice water--a scarce item in that decade. Today, 270 highway signs advertise the drugstore, including one strategically placed in my Senate office reception room. It reads, ``1,523 miles to Wall Drug''. Even though the first 7 years of business were painfully hard, Dorothy was always optimistic. Success was inevitable with her enthusiasm and dedication. Mrs. Hustead once summed up her philosophy: ``I believe any person with patience, faith, humility, and courage can--by hard work, enthusiasm, and by following a plan--succeed.'' Born on August 29, 1904, Dorothy began her rich and fulfilling life in the town of Colman, SD. This small town upbringing and her strong family ties instilled in her a deep respect for traditional values. She graduated from Colman High School and attended the University of Nebraska at Lincoln, where she was a member of the Delta Delta Delta Sorority. It was there that she met her husband, Ted Hustead of Aurora, NE. Dorothy graduated from the University of Nebraska with a degree in English and taught English and drama at Cathedral High School in Sioux Falls, SD. The young Husteads lived and worked in several South Dakota towns-- Colman, Dell Rapids, Sioux Falls, Oldham, and Canova--before purchasing their small drugstore in Wall. Throughout the years, Dorothy worked steadfastly beside Ted as a full partner at Wall Drug, acting as one of the floor managers in charge of receipts. She was on the board of directors of Wall Drug Inc. until her recent death. Dorothy was a member of the Society of Mayflower Descendants, the Wall Book Club--of which she was one of the founders--and St. Patrick's Catholic Church. She, along with Ted, received the first Ben Black Elk Award in 1979, for excellence in the travel industry. November 12, 1988, was proclaimed by South Dakota Gov. George Mickelson as ``Dorothy and Ted Hustead Day''. Dorothy Hustead was a true friend to me and to thousands of other South Dakotans, as well as visitors to our State. I always will remember her fondly.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I join with millions around the world to express my shock and sorrow for the loss of Israeli Prime Minister Yitzhak Rabin. My thoughts and prayers are with the Rabin family and the people of Israel. A family, a nation, a world will be without an extraordinary human being. Throughout my career in Congress, I always have had a special interest in Israel. A special bond exists between the people of the United States and the people of Israel. It is bond based on shared ideals--for freedom, for democracy, and for peace. Yitzhak Rabin made these ideals his own, and sought their preservation for future generations. I am fortunate to say I met Yitzhak Rabin on a number of occasions. Through intelligence, savvy, and sheer will, Yitzhak Rabin was a significant participant in virtually every major chapter of Israel's modern existence: He served as a brigade commander during Israel's struggle for independence; he was Chief of Staff of the Israeli Army during the 1967 Arab-Israeli war; he was Prime Minster and architect of the legendary Entebbe rescue mission in Uganda; and of course, he was Prime Minister during the historic peace process. On meeting Yitzhak Rabin, it becomes clear why he was a leader of Israel. For in this man, one can see a nation's characteristics: Tough, intelligent, fair, determined, and yes, compassionate. Yitzhak Rabin, like all Israelis, loved his country, and was willing to give his life to defend his country and bring real peace to his people. Abraham Lincoln referred to this extreme level of personal sacrifice, ``the last full measure of devotion.'' Indeed, Yitzhak Rabin demonstrated the fullness of his devotion to Israel to the very end. Yitzhak Rabin devoted and ultimately gave his life to bring about what was considered impossible: a lasting peace in Israel and throughout the Middle East. Now the people of Israel need to come together and see that his cause for peace is achieved and maintained for all time. That is a challenge shared by all nations who have an interest in peace in the Middle East. No man had a greater role in shaping the current peace process than Yitzhak Rabin. And no man has played a greater part in placing the peace process in jeopardy than the cowardly thug who [[Page S 16711]] killed Prime Minister Rabin by shooting him in the back. However, as the people of the United States know all too well, the cause of peace and freedom must not fall victim to violence and hate. Yitzhak Rabin would agree. The pursuit of peace is above any one man's capability to add to it, as well as any one man's audacity to destroy it. No matter what form violence may take, it must not stop nor slow our collective quest for peace and freedom in the Middle East. Mr. President, again, I extend my best wishes to the Rabin family and the people of Israel. We have lost a great man, but his dream, his legacy of a strong, vibrant Israel at peace with her neighbors is very much with us still. It must not perish with him.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, today I am introducing the Interstate Commerce Commission Sunset Act of 1995. I am very pleased to be joined in this effort by Senator Exon. It is a bipartisan bill and I urge my colleagues' bipartisan support as we work toward what must be very swift passage. Let me also make it clear at the outset that this bill is a work in progress. I introduce it today as the next step in a process of discussions and revisions that have been ongoing for months. This process will continue. I would like to begin by outlining some of the underlying philosophy that went into its drafting. In addition, I will address the procedural posture in which we find ourselves in relation to this bill. In preparation of the legislation we are introducing today, Senator Exon and I have worked together very closely. In fact, much of this legislation initially was written by my good friend and distinguished coauthor. Compromise and cooperation have produced what I feel is a balanced bill, addressing the immediate and compelling needs driving this legislation. Our staff members and those of other committee members have collaborated throughout this process. They have spent many long hours in joint meetings with various interest groups and constituents who have raised concerns or urged additions. We have worked very hard to address legitimate concerns, and have made numerous changes to the previously circulated staff draft in an effort to address those concerns. However, as hard as we have worked to please all parties, our policy decisions ultimately were driver, in part, by the need to produce a bill which could be passed and signed into law this year. In short, the clock is running. For reasons I shall address in a moment, however, we have made a conscious effort to avoid addressing broader transportation policy issues than those directly related to sunsetting the ICC and transferring its essential functions to its successor. To that extent, the Senate bill is more limited in scope than its House counterpart. Indeed, it remains largely unchanged from the staff draft which was circulated some time ago. Mr. President, I introduce this legislation with mixed feelings. On the one hand, I am a firm believer in a less-is-better approach when it comes to government. Too often in Congress, we gage accomplishment by quantity rather than quality. We need to reduce Federal Government. In that sense, this is historic legislation. The ICC is our oldest independent agency, yet its functions can and should be reduced. Indeed, this could be said about every agency, every executive department, and both Houses of Congress. Less would be better. Our bill moves us in that direction. However, the positive and necessary adjudicatory role of the ICC should not come to a screeching halt. Indeed, the ICC has performed and continues to perform important functions. For example, without its abandonment public interest review authority, my home State of South Dakota would today have hundreds of miles less rail service than we presently enjoy. Quite honestly, budget constraints and appropriations legislation which terminate the agency's functions at the end of this year renders moot any debate over whether or not we should keep the ICC. Given the realities of the budget situation, the issue is not whether the ICC should be terminated, but how it will be dismantled. Therefore, we must determine what ICC functions can continue to be effectively performed by a successor with a greatly reduced budget. Which functions can be subsumed into the Department of Transportation? Is there an ongoing need for a review process independent of political pressures? These are questions this legislation is designed to address. This bill provides a reasoned approach designated to ensure continued protections against industry abuse while at the same time assure the economic efficiencies of our Nation's surface transportation system can continue. We propose to sunset the ICC and transfer its necessary residual functions to an independent Intermodal Surface Transportation Board within the U.S. Department of Transportation. The Board would administer the residual regulations over rail carriers and pipelines and provide limited adjudicatory oversight over the motor carrier industry. The Secretary of Transportation would inherit the residual nonadjudicatory functions governing the motor carrier industry. Fundamentally, the approach taken in this legislation was to limit its [[Page S 16672]] scope to the most efficient and simplest sunset and transfer bill, as opposed to a wholesale rewrite of transportation policy. But the very nature of the task--which is to close down an entire Federal agency-- there is of necessity a need to sunset certain of its functions, however, some changes to these functions also had to be made in light of the budget realities which will confront the remaining agency. None of this is to say concerns raised during the process through which this legislation was developed are not legitimate. Indeed, I believe they are. I am particularly concerned about the concerns of small rail shippers and operators in light of recent and continuing industry trends toward overwhelming industry concentration. More and more of this Nation's rail infrastructure is owned by fewer and fewer railroads. Competitive concerns continue to increase, and the leverage of the smaller shippers and small feeder railroads relative to the class I railroads decreases. I recall chairing a hearing in 1985 which addressed some of those concerns. Since that time, my concern has only heightened. Some have urged us to re-regulate the rail industry in this legislation. They argue that since the Staggers Act greatly deregulated the rail industry, shippers have been faced with difficult if not impossible relief mechanisms. They point out that the potential for shipper abuse increases with industry concentration. Their arguments are not entirely unpersuasive. However, a return to a pre-Staggers approach is not the answer at this time. The shipper complaint procedure at the current ICC is hopelessly complicated to the point where shippers with a legitimate grievance generally do not have an effective remedy available. The real question in my mind is the extent to which legitimate grievances can be identified, aired, and resolved. Most of the suggestions raised involved some form of re-regulation. Even though I voted against the Staggers Act over a decade ago, I must say it has proved to be extraordinarily successful in reviving a failing industry and on balance has been positive for shippers and industry alike. Therefore, at this juncture, it is premature to attempt to re-regulate, without a clearer identification and articulation of the problem, and an established record which provides some reasonably compelling evidence that the solution proposed actually fixes the problem. On both counts, it seems more effort could be made by all parties to attempt to develop industry solutions before seeking Government solutions. The fundamental problem I see developing in the industry today is that the shippers and others are, as I said, increasingly losing leverage in their relations with the class I railroads. In many ways, shippers and small railroads are in the same boat. Due to these concerns, I am proposing to establish a rail-shipper transportation advisory council in an attempt to give them a stronger voice, and a mechanism to resolve many of the concerns within the industry, rather than having the Government address them. It is clearly and intentionally weighted in favor of small shippers and small railroads in an effort to address the many issues in which they have mutual and legitimate public interest concerns. After a reasonable opportunity has been made available to review the varied issues confronting small shippers and railroads, I would anticipate a series of oversight hearings to review the advisory council's findings or recommendations, and, if necessary, appropriate legislative action will be taken. Whether the council is an effective tool or not will depend largely on the reasonableness of the small shippers and railroads position. It would be as much of a mistake for them to overplay their hand as it would for the large railroads not to treat their concerns seriously. If the smaller railroads and shippers overplay their hand by making unreasonable demands, the council will quickly lose credibility, both within the industry and with policy makers. At the same time, if class I's are indifferent or unresponsive to legitimate concerns raised, legislative solutions far more expansive than any proposed to date will be seriously considered. Re-regulation, antitrust protection, and everything else will be on the table. Mr. President, let me say it again. This chairman knows the concerns of the shippers and small railroads are very real. They need to be addressed. The message to both the rail industry and to shippers is simple. Be reasonable. Define and solve your problems to the best of your ability. Excessive Government involvement is a last resort. It will not happen without compelling need and a demonstration of good faith effort by those seeking Government intervention, that all reasonable avenues to develop a reasonable industry compromise have been blocked by relative unreasonableness. With respect to labor, there have been attempts to reach a negotiated solution to that issue as well. We have included language which is far less satisfactory in my view than the House bill, but I agree to it with the expectation that the parties can agree to compromise on this issue. It remains an issue that is unresolved, but which shall--as with other provisions of the bill--be addressed further.

Mr. PRESSLER. Mr. President, I rise today to introduce legislation to allow companies that violate the Clean Water Act the option to invest fines in improving their local environment. This bill makes good sense. Clean Water Act fines could be invested in the community where the violation occurred, rather than sent to Washington to be spent by bureaucrats. In May 1995, the Environmental Protection Agency began a new program to encourage local environmental projects through EPA fines. My bill would adopt as law the goals of this program--to give Clean Water Act violators the option to perform community services by targeting their fines to local pollution prevention and remediation activities. Under my legislation, companies found guilty of violating the Clean Water Act would be given the option of contributing to a community environmental project in lieu of paying fines directly to the Treasury. Violators could negotiate with State and local officials to determine an appropriate project. The money would then be paid by the violator directly to cover project costs. The benefits to this legislation are clear. Passage of this bill would express Congress' support for local environmental projects. In addition, this legislation represents community empowerment. It gives the local community the opportunity to right a wrong done to its citizens by one of its own. It is common sense. Clean Water Act violations inadvertently can punish the community where the violation occurred. It's only fair that when a violator is punished, the community should receive some compensation. This option certainly is preferable to sending penalty dollars back to Washington to pay for more bureaucracy. At the State and local level, many of those who violate the law are directed to perform community service. That tradition deserves a place in our Federal system as well. The legislation I am introducing today would do just that. [[Page S 16663]] Senator Chafee, chairman of the Environment and Public Works Committee, has stated his intent to hold hearings on efforts to reform the Clean Water Act in the near future. I look forward to working with him to make sure that fines collected under the Clean Water Act can continue to be used for the benefit of the community where violations occurred. I urge my colleagues to support this commonsense legislation.

Mr. PRESSLER. Mr. President, I am introducing legislation today to lift the unfair burden of excessive regulatory penalties from the backs of local governments that are working in good faith to comply with the Clean Water Act. Mr. President, earlier this year we worked on legislation to bring common sense to the regulatory process. That legislation is still pending. It is my hope that we will return to that bill and pass it. Everyone from small business persons to city mayors want real relief from Federal regulatory overreach. That is the goal of my bill as well. Under current law, civil penalties begin to accumulate the moment a local government violates the Clean Water Act. Once this happens, the law requires that the local government present a municipal compliance plan for approval by the Administrator of the Environmental Protection Agency [EPA], or the Secretary of the Army in cases of section 404 violations. However, even after a compliance plan has been approved, penalties continue to accumulate. In effect, existing law gives the EPA the authority to continue punishing local governments while they are trying to comply with the law. When I talk with South Dakotans, few topics raise their blood pressure faster than their frustrating dealings with the Federal bureaucracy. Government is supposed to work for us, not against us. Mr. President, this is clearly a case where the Government is working against those cities and towns trying in good faith to comply with the Clean Water Act. In South Dakota, the city of Watertown's innovative/alternative technology wastewater treatment facility was built as a joint partnership with the EPA, the city and the State of South Dakota in 1982. The plant was constructed with the understanding that EPA would provide assistance in the event the new technology failed. The facility was modified and rebuilt in 1991 when it was unable to comply with Clean Water Act discharge requirements. Unfortunately, the newly reconstructed plan still was found to violate Federal regulations. The city now faces a possible lawsuit by the Federal Government and is incurring fines of up to $25,000 per day. The city of Watertown, under the very capable guidance of Mayor Brenda Barger, has entered into a municipal compliance plan with the EPA. Under the agreed plan, Watertown should achieve compliance by December 1996. However, that plan does not address the issue of the civil and administrative penalties that continue to accumulate against the city. Under the law, Watertown could accumulate an additional $14 million in penalties before its treatment facility is able to comply with the Clean Water Act requirements. Mr. President, no city in South Dakota can afford such steep penalties. My legislation would offer relief to cities like Watertown. Under my bill, local governments would stop accumulating civil and administrative penalties once a municipal compliance plan has been negotiated and the locality is acting in good faith to carry out the plan. Further, my bill would be an incentive for governments to move quickly toward achieving compliance with the Clean Water Act. This legislation is designed simply to address an issue of fairness. Local governments must operate with a limited pool of resources. Localities should not be forced to devote their tax revenues both to penalties and programs designed to comply with the law. It defies common sense for the EPA to penalize a local government at the same time it is working in good faith to comply with the law. My legislation restores common sense and fairness to local governments. By eliminating unfair penalties, local governments could better concentrate their resources to meet the intent of the law in protecting our water resources from pollution. Mr. President, I hope my colleagues will join me in supporting this commonsense legislation for our towns and cities.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I am introducing legislation today to lift the unfair burden of excessive regulatory penalties from the backs of local governments that are working in good faith to comply with the Clean Water Act. Mr. President, earlier this year we worked on legislation to bring common sense to the regulatory process. That legislation is still pending. It is my hope that we will return to that bill and pass it. Everyone from small business persons to city mayors want real relief from Federal regulatory overreach. That is the goal of my bill as well. Under current law, civil penalties begin to accumulate the moment a local government violates the Clean Water Act. Once this happens, the law requires that the local government present a municipal compliance plan for approval by the Administrator of the Environmental Protection Agency [EPA], or the Secretary of the Army in cases of section 404 violations. However, even after a compliance plan has been approved, penalties continue to accumulate. In effect, existing law gives the EPA the authority to continue punishing local governments while they are trying to comply with the law. When I talk with South Dakotans, few topics raise their blood pressure faster than their frustrating dealings with the Federal bureaucracy. Government is supposed to work for us, not against us. Mr. President, this is clearly a case where the Government is working against those cities and towns trying in good faith to comply with the Clean Water Act. In South Dakota, the city of Watertown's innovative/alternative technology wastewater treatment facility was built as a joint partnership with the EPA, the city and the State of South Dakota in 1982. The plant was constructed with the understanding that EPA would provide assistance in the event the new technology failed. The facility was modified and rebuilt in 1991 when it was unable to comply with Clean Water Act discharge requirements. Unfortunately, the newly reconstructed plan still was found to violate Federal regulations. The city now faces a possible lawsuit by the Federal Government and is incurring fines of up to $25,000 per day. The city of Watertown, under the very capable guidance of Mayor Brenda Barger, has entered into a municipal compliance plan with the EPA. Under the agreed plan, Watertown should achieve compliance by December 1996. However, that plan does not address the issue of the civil and administrative penalties that continue to accumulate against the city. Under the law, Watertown could accumulate an additional $14 million in penalties before its treatment facility is able to comply with the Clean Water Act requirements. Mr. President, no city in South Dakota can afford such steep penalties. My legislation would offer relief to cities like Watertown. Under my bill, local governments would stop accumulating civil and administrative penalties once a municipal compliance plan has been negotiated and the locality is acting in good faith to carry out the plan. Further, my bill would be an incentive for governments to move quickly toward achieving compliance with the Clean Water Act. This legislation is designed simply to address an issue of fairness. Local governments must operate with a limited pool of resources. Localities should not be forced to devote their tax revenues both to penalties and programs designed to comply with the law. It defies common sense for the EPA to penalize a local government at the same time it is working in good faith to comply with the law. My legislation restores common sense and fairness to local governments. By eliminating unfair penalties, local governments could better concentrate their resources to meet the intent of the law in protecting our water resources from pollution. Mr. President, I hope my colleagues will join me in supporting this commonsense legislation for our towns and cities.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, today I am introducing the Interstate Commerce Commission Sunset Act of 1995. I am very pleased to be joined in this effort by Senator Exon. It is a bipartisan bill and I urge my colleagues' bipartisan support as we work toward what must be very swift passage. Let me also make it clear at the outset that this bill is a work in progress. I introduce it today as the next step in a process of discussions and revisions that have been ongoing for months. This process will continue. I would like to begin by outlining some of the underlying philosophy that went into its drafting. In addition, I will address the procedural posture in which we find ourselves in relation to this bill. In preparation of the legislation we are introducing today, Senator Exon and I have worked together very closely. In fact, much of this legislation initially was written by my good friend and distinguished coauthor. Compromise and cooperation have produced what I feel is a balanced bill, addressing the immediate and compelling needs driving this legislation. Our staff members and those of other committee members have collaborated throughout this process. They have spent many long hours in joint meetings with various interest groups and constituents who have raised concerns or urged additions. We have worked very hard to address legitimate concerns, and have made numerous changes to the previously circulated staff draft in an effort to address those concerns. However, as hard as we have worked to please all parties, our policy decisions ultimately were driver, in part, by the need to produce a bill which could be passed and signed into law this year. In short, the clock is running. For reasons I shall address in a moment, however, we have made a conscious effort to avoid addressing broader transportation policy issues than those directly related to sunsetting the ICC and transferring its essential functions to its successor. To that extent, the Senate bill is more limited in scope than its House counterpart. Indeed, it remains largely unchanged from the staff draft which was circulated some time ago. Mr. President, I introduce this legislation with mixed feelings. On the one hand, I am a firm believer in a less-is-better approach when it comes to government. Too often in Congress, we gage accomplishment by quantity rather than quality. We need to reduce Federal Government. In that sense, this is historic legislation. The ICC is our oldest independent agency, yet its functions can and should be reduced. Indeed, this could be said about every agency, every executive department, and both Houses of Congress. Less would be better. Our bill moves us in that direction. However, the positive and necessary adjudicatory role of the ICC should not come to a screeching halt. Indeed, the ICC has performed and continues to perform important functions. For example, without its abandonment public interest review authority, my home State of South Dakota would today have hundreds of miles less rail service than we presently enjoy. Quite honestly, budget constraints and appropriations legislation which terminate the agency's functions at the end of this year renders moot any debate over whether or not we should keep the ICC. Given the realities of the budget situation, the issue is not whether the ICC should be terminated, but how it will be dismantled. Therefore, we must determine what ICC functions can continue to be effectively performed by a successor with a greatly reduced budget. Which functions can be subsumed into the Department of Transportation? Is there an ongoing need for a review process independent of political pressures? These are questions this legislation is designed to address. This bill provides a reasoned approach designated to ensure continued protections against industry abuse while at the same time assure the economic efficiencies of our Nation's surface transportation system can continue. We propose to sunset the ICC and transfer its necessary residual functions to an independent Intermodal Surface Transportation Board within the U.S. Department of Transportation. The Board would administer the residual regulations over rail carriers and pipelines and provide limited adjudicatory oversight over the motor carrier industry. The Secretary of Transportation would inherit the residual nonadjudicatory functions governing the motor carrier industry. Fundamentally, the approach taken in this legislation was to limit its [[Page S 16672]] scope to the most efficient and simplest sunset and transfer bill, as opposed to a wholesale rewrite of transportation policy. But the very nature of the task--which is to close down an entire Federal agency-- there is of necessity a need to sunset certain of its functions, however, some changes to these functions also had to be made in light of the budget realities which will confront the remaining agency. None of this is to say concerns raised during the process through which this legislation was developed are not legitimate. Indeed, I believe they are. I am particularly concerned about the concerns of small rail shippers and operators in light of recent and continuing industry trends toward overwhelming industry concentration. More and more of this Nation's rail infrastructure is owned by fewer and fewer railroads. Competitive concerns continue to increase, and the leverage of the smaller shippers and small feeder railroads relative to the class I railroads decreases. I recall chairing a hearing in 1985 which addressed some of those concerns. Since that time, my concern has only heightened. Some have urged us to re-regulate the rail industry in this legislation. They argue that since the Staggers Act greatly deregulated the rail industry, shippers have been faced with difficult if not impossible relief mechanisms. They point out that the potential for shipper abuse increases with industry concentration. Their arguments are not entirely unpersuasive. However, a return to a pre-Staggers approach is not the answer at this time. The shipper complaint procedure at the current ICC is hopelessly complicated to the point where shippers with a legitimate grievance generally do not have an effective remedy available. The real question in my mind is the extent to which legitimate grievances can be identified, aired, and resolved. Most of the suggestions raised involved some form of re-regulation. Even though I voted against the Staggers Act over a decade ago, I must say it has proved to be extraordinarily successful in reviving a failing industry and on balance has been positive for shippers and industry alike. Therefore, at this juncture, it is premature to attempt to re-regulate, without a clearer identification and articulation of the problem, and an established record which provides some reasonably compelling evidence that the solution proposed actually fixes the problem. On both counts, it seems more effort could be made by all parties to attempt to develop industry solutions before seeking Government solutions. The fundamental problem I see developing in the industry today is that the shippers and others are, as I said, increasingly losing leverage in their relations with the class I railroads. In many ways, shippers and small railroads are in the same boat. Due to these concerns, I am proposing to establish a rail-shipper transportation advisory council in an attempt to give them a stronger voice, and a mechanism to resolve many of the concerns within the industry, rather than having the Government address them. It is clearly and intentionally weighted in favor of small shippers and small railroads in an effort to address the many issues in which they have mutual and legitimate public interest concerns. After a reasonable opportunity has been made available to review the varied issues confronting small shippers and railroads, I would anticipate a series of oversight hearings to review the advisory council's findings or recommendations, and, if necessary, appropriate legislative action will be taken. Whether the council is an effective tool or not will depend largely on the reasonableness of the small shippers and railroads position. It would be as much of a mistake for them to overplay their hand as it would for the large railroads not to treat their concerns seriously. If the smaller railroads and shippers overplay their hand by making unreasonable demands, the council will quickly lose credibility, both within the industry and with policy makers. At the same time, if class I's are indifferent or unresponsive to legitimate concerns raised, legislative solutions far more expansive than any proposed to date will be seriously considered. Re-regulation, antitrust protection, and everything else will be on the table. Mr. President, let me say it again. This chairman knows the concerns of the shippers and small railroads are very real. They need to be addressed. The message to both the rail industry and to shippers is simple. Be reasonable. Define and solve your problems to the best of your ability. Excessive Government involvement is a last resort. It will not happen without compelling need and a demonstration of good faith effort by those seeking Government intervention, that all reasonable avenues to develop a reasonable industry compromise have been blocked by relative unreasonableness. With respect to labor, there have been attempts to reach a negotiated solution to that issue as well. We have included language which is far less satisfactory in my view than the House bill, but I agree to it with the expectation that the parties can agree to compromise on this issue. It remains an issue that is unresolved, but which shall--as with other provisions of the bill--be addressed further.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I rise today to introduce legislation to allow companies that violate the Clean Water Act the option to invest fines in improving their local environment. This bill makes good sense. Clean Water Act fines could be invested in the community where the violation occurred, rather than sent to Washington to be spent by bureaucrats. In May 1995, the Environmental Protection Agency began a new program to encourage local environmental projects through EPA fines. My bill would adopt as law the goals of this program--to give Clean Water Act violators the option to perform community services by targeting their fines to local pollution prevention and remediation activities. Under my legislation, companies found guilty of violating the Clean Water Act would be given the option of contributing to a community environmental project in lieu of paying fines directly to the Treasury. Violators could negotiate with State and local officials to determine an appropriate project. The money would then be paid by the violator directly to cover project costs. The benefits to this legislation are clear. Passage of this bill would express Congress' support for local environmental projects. In addition, this legislation represents community empowerment. It gives the local community the opportunity to right a wrong done to its citizens by one of its own. It is common sense. Clean Water Act violations inadvertently can punish the community where the violation occurred. It's only fair that when a violator is punished, the community should receive some compensation. This option certainly is preferable to sending penalty dollars back to Washington to pay for more bureaucracy. At the State and local level, many of those who violate the law are directed to perform community service. That tradition deserves a place in our Federal system as well. The legislation I am introducing today would do just that. [[Page S 16663]] Senator Chafee, chairman of the Environment and Public Works Committee, has stated his intent to hold hearings on efforts to reform the Clean Water Act in the near future. I look forward to working with him to make sure that fines collected under the Clean Water Act can continue to be used for the benefit of the community where violations occurred. I urge my colleagues to support this commonsense legislation.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I want to take a moment to pay tribute to Bill Mott, a South Dakotan who has become one of our Nation's truly great horse trainers. Last weekend, at Belmont Park in New York, a thoroughbred bay named Cigar won the finale of the Breeders' Cup Classics. The finale was Cigar's 12th straight track victory. With that victory, Cigar secured Horse of the Year honors, and is on track for even greater glory next year. Cigar could break the all-time record of 16 consecutive track victories, which was done by the legendary Citation, and could surpass Alysheba as horse racing's all-time money winner. Of course, Cigar would not have achieved excellence on the track if it was not for the training excellence of Bill Mott. It was Bill who put Cigar on the path of greatness by switching the bay from grass racing to dirt. Though bred for grass, Cigar won only 1 race in 11 starts on turf. Bill's move to dirt has moved Cigar to the ranks of the unbeaten. For Bill Mott, his success as a horse trainer is nothing less than a childhood dream come true. It was while he was in high school at Park Jefferson in South Dakota that Bill Mott began his career as a horse trainer. At the age of 16, Bill won the South Dakota Thoroughbred Futurity. After graduating high school, Bill left South Dakota to pursue his dream. Bill learned from many great trainers, including Bob Irwin, Jack Van Berg and D. Wayne Lukas. Now, young, aspiring trainers no doubt will be seeking Bill out. Today, Bill Mott is at the peak of his profession. Bill trains more than 100 horses across the country. Bill is the best because he knows how to bring out the best in the horses he trains. His record is proof: Last year, Bill's horses won 137 races; this year, his victory total reached 140. Bill Mott is an inspiration not just to aspiring horse trainers, but to all who set their sites to be the very best in their profession. I am sure all who know Bill Mott, especially his friends and family back home in South Dakota, are very proud of him. In fact, Bill's brother Rob, a pilot who lives in Mobridge, SD, just returned to our State after being with Bill during his latest achievements at the Breeders' Cup Classics. One of the best parts of my job is when I can speak of the great accomplishments of South Dakotans like Bill Mott. Through hard work and determination, Bill Mott is living a dream come true. My wife, Harriet, and I wish Bill Mott continued success in the years ahead.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I urge my colleagues to support the passage of H.R. 436, the Edible Oil Regulatory Reform Act. Passage of this measure is long overdue. The problem this measure would address is how Federal agencies regulate the shipment of edible oils, as compared with toxic oils. Action is needed because agencies currently do not make a distinction between these two kinds of oils. Unless we pass H.R. 436, we face a potential loss in agricultural exports and diminished farm income. This issue is not new to this body. Last year, I joined Senator Lugar and Senator Harkin in sponsoring similar legislation that passed the Senate but did not become law. As a result, earlier this year, I joined Senator Lugar and 14 other Senators in introducing S. 679, the Senate counterpart to H.R. 436. By passing H.R. 436, we immediately can clear this bill for the President's signature. The bill is simple and very straight-forward. Under H.R. 436, regulatory agencies would be required to establish separate standards governing shipments of edible oilseeds and shipments of toxic oils, such as petroleum. Presently, Federal agencies enforce the Oil Pollution Act of 1990 in a manner that treats animal fats and vegetable oils in the same way as toxic oils. Mr. President, this kind of enforcement was never congressional intent. The bill we are considering today would state clearly to Federal agencies that edible oils are not to be treated in the same manner as toxic oils. However, let me be clear. Under no circumstance would this bill change the Oil Pollution Act of 1990 as it relates to toxic oils. This bill has strong support. I ask unanimous consent that a list of organizations supporting the measure be printed in the Record at this point.

Mr. PRESSLER. The need for H.R. 436 is compelling. Without action, we are diminishing inadvertently agricultural exports. In addition, existing regulations could have a chilling effect on the development of new crops and new uses of crop production. Farm exports are nearing all time highs. The future for oilseeds is equally bright. However, current enforcement of the Oil Pollution Act works against this progress. It has become clearly evident that existing regulations would seriously impact exports of U.S. agricultural commodities, especially vegetable oils and animal fats. Unless we pass this bill, the U.S. animal fat and vegetable oil industries are faced with lost export sales of more than $125 million. It is a critical time for oilseed crushers, who are operating at peak capacity with the new oilseed crop. Losing export markets could lead to an oversupply situation that could cut the [[Page S 16619]] value of the U.S. soybean crop by more than $1 billion. New crops and new industrial uses for agricultural raw materials mean greater demand for farm commodities. New industrial crops allow farmers to diversify their farming systems and income sources, improve crop rotations and reduce reliance on government commodity programs. Jobs and income would be generated as new crops are taken from the farm gate to the processors and on to the wholesalers and retailers. The predominant post-farming activity would be in the transportation, manufacturing, distribution and support sectors of farm states. New crops to grow in South Dakota are likely to be edible oilseeds. The most likely candidates are crambe, industrial rapeseed and canola. They could compliment South Dakota's production of sunflowers, which is a major industry in my state. Production in 1994 was valued at nearly $150 million. Most of the sunflower production in South Dakota is for oil, and at least 40 percent of the sunflower production in South Dakota is exported. In summary, Mr. President, there is a great need for this bill to become law. The bill simply would put common sense into existing regulations and would help those regulations come into line with Congressional intent. And the winners out of all this are our farmers and ranchers. I urge passage of H.R. 436.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I intend to vote for passage of the conference report to H.R. 1868, the foreign operations appropriations bill. I do so because there are a number of vitally important provisions in this legislation, chief among them being the extension of the Middle East Peace Facilitation Act. I share the concerns of many of my colleagues regarding Palestinian compliance with the peace accords, and will continue to follow this issue with great interest. With this bill, the American taxpayer once again is investing in what all hope to be a historic and lasting peace in the Middle East. It is up to us here in Congress to be sure that it is a wise investment, and that the conditions that brought about it are met. I must confess I will vote in favor of this bill with great reluctance. I am very disappointed that the House and Senate conferees agreed to keep in the bill Senate language that would repeal a portion of Federal law that prohibits United States aid to Pakistan as long as the President fails to certify that Pakistan is not in possession of a nuclear explosive device--a law otherwise known as the Pressler amendment. The provision in H.R. 1868 would allow nonmilitary aid to resume to Pakistan, and would authorize the President to transfer $370 million in military equipment sought by Pakistan but not delivered because of the Pressler sanctions. By including this provision, this Congress has put the American taxpayer back in the business of subsidizing a nuclear program that this Nation does not recognize under the Nuclear Non-Proliferation Treaty [NNPT]. Even worse, today the U.S. Congress has sent a chilling message: Nuclear proliferation pays. This is a frustrating day, Mr. President. Ten years ago, the U.S. Congress passed the Pressler amendment. In so doing, we made it clear that the United States could not condone, through foreign aid, Pakistan's drive for the bomb. It was our hope that the leverage of foreign aid would deter Pakistan from developing nuclear weapons. If it did not, it was important from the standpoint of nonproliferation that the United States not subsidize Pakistan's nuclear program. That was the purpose behind the Pressler amendment. By and large, the Pressler amendment has worked. First, though never verified, Pakistan claims it has ceased developing weapons grade enriched uranium. Second, the threat of Pressler sanctions has deterred a number of states that pursued active nuclear weapons research programs in the 1980's, including Argentina, Brazil, South Korea, Taiwan, and South Africa. This successful track record now risks being reversed. I have expressed my strong concerns on this issue in this Chamber already in great detail. I will not repeat them here. The bottom line is clear: Our Nation's nonproliferation policy is in serious jeopardy, and it is not just with respect to the Pressler amendment. We have heard many reports that the communist Chinese have shipped M-11 related missile technology to both Pakistan and Iran in violation of the Missile Technology Control Regime. Under a law I drafted, the President has presumptive authority to impose sanctions against the responsible parties in China if he has reason to believe an MTCR violation has occurred. Yet, the President is unwilling to exercise that authority. Further, the current House and Senate versions of the intelligence authorization bill contain language that would give the President unprecedented discretion to waive U.S. nonproliferation laws. Mr. President, just last year, the President stated that no foreign policy issue was more important to the security of all people than nuclear nonproliferation. Yet, the current administration is engineering an unprecedented rollback in U.S. nonproliferation laws and policies. The administration's actions do not match its rhetoric. This demonstration of double- think would be very humorous if the issue was not so very serious. For those of us in Congress who have devoted many years on nonproliferation issues, these recent developments are very disturbing. As the world's sole remaining superpower, the signatories of the NNPT look to us to set the example and enforce the rules. Yet, today, we are changing the rules of the nuclear nonproliferation game to benefit one proliferator. This is the worst possible message we could send to those nations who have played by the rules.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I want to take a few moments to update my colleagues on the progress we are making on telecommunications reform in the 104th Congress. Last Wednesday morning I had the honor of chairing the organizational meeting of the Senate-House conference on S. 652, the Telecommunications Competition and Deregulation Act of 1995. It was truly a historic day. We began the final stage of enacting comprehensive telecommunications deregulation legislation--the most significant and profound change in our Nation's telecommunications policy and law in over 60 years. As conference chairman, I will continue--as I have throughout this long process--to work in an open, inclusive, and bipartisan fashion with all of my Senate and House colleagues. In particular, I want to thank the Senate Commerce Committee's ranking Democratic member, Senator Fritz Hollings of South Carolina, for his leadership and willingness to work cooperatively with me at each stage of this process. I also heartily applaud the tremendous work of our House colleagues in helping get us to this stage of the process. I very much look forward to working closely with them under the able leadership of Commerce Committee Chairman Tom Bliley, and ranking Democrat John Dingell, Telecommunications Subcommittee Chairman Jack Fields, and ranking Democrat Ed Markey, and Judiciary Committee Chairman Henry Hyde, and ranking Democrat John Conyers. Let me also add that I look forward to working with President Clinton, Vice President Gore, and others in the executive branch. I have welcomed the administration's input from the beginning of the process. I am firmly committed to moving this conference forward as rapidly as possible. In order to move quickly, however, we must remain within the confines of the two bills before us. To do otherwise would be like opening the proverbial Pandora's box. It would result in unacceptable delay as we rehash issues resolved through hours, days, weeks and months of negotiation and committee and floor votes at earlier points in this long process. I am convinced we can rapidly move this conference forward due to the striking degree of similarity between the two bills. Moreover, we have the strong support and commitment from the leadership in both Chambers to act this year. The time has long passed since Congress needed to reassert its rightful place in establishing national telecommunications policy. Dozens of lines of business restrictions carve up telecommunications and forbid competition. Meanwhile, once separate and distinct industry segments have become indistinguishable due to digital technology. Yet the regulatory apartheid regime remains. The conference on telecommunications reform will produce a report to change all that. We will open all telecommunications markets to competition. The result will be a procompetitive, deregulatory and balanced regime. Competition and deregulation, after all, are the only sure-fire ways to ensure: an explosion of new technologies and choices for consumers, massive new market investment, captialization, and job creation, lower prices for telecommunications products and services, and an end to monopolies and media concentration. The legislation we are crafting is, simply put, the most comprehensive deregulation of the telecommunications industry in American history. It will promote advanced telecommunications, information networks and other resources in such a manner as to ensure America remains the envy of the world. In order to maintain our world leadership position in communications, however, we need this legislation and we need it now. Mr. President, I was pleased to receive a letter from the majority leader, Senator Bob Dole, reiterating his desire to complete action on the telecommunications reform bill prior to adjourning for the year. This is entirely consistent with my stated intention from the very beginning of this process--to enact a new telecommunications deregulation law in 1995. Mr. President, I ask unanimous consent to have the letter from Senator Dole printed in the Record.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, not surprisingly, Stuart Oran, United Airlines' Executive Vice President for Corporate Affairs and General Counsel, recently offered a markedly different view of what our negotiating approach should be with the Japanese. I predict other 1952 carriers will endorse Mr. Oran's view and therefore refer to it as the ``1952 carrier approach.'' According to Mr. Oran, it would be economic folly for the United States to cap the 1952 carriers' beyond rights and thereby prevent them from growing within the rapidly expanding Asia-Pacific market. In fact, Mr. Oran warned the United States would be playing into the Government of Japan's hands were we to follow the negotiating strategy Mr. Crandall recommends. To illustrate the point that trading away the beyond rights held by 1952 carriers would be tantamount to ceding the Pacific-Asian market to Japanese and other foreign carriers, Mr. Oran described a recent study by Booz Allen & Hamilton which United Airlines commissioned. That study, which assessed the value of beyond rights in Japan to the United States economy, concluded ``the U.S. would suffer a trade loss in excess of $100 billion over the next twenty years--the bulk of which would be transferred to Japan'' if the United States agreed to surrender our passenger carriers' beyond rights. Mr. Oran characterized the approach Mr. Crandall recommends as a ``sucker deal that would put all U.S. businesses at a permanent disadvantage in the exploding Asian market.'' I ask unanimous consent that a copy of Mr. Oran's speech be printed in the Record at the conclusion of my remarks.

Mr. PRESSLER. Mr. President, as the debate between MOU carriers and 1952 carriers intensifies, I look forward to learning more about each position and urge my colleagues to do the same. For example, I am anxious to see economic analysis from the MOU carriers regarding their claim that trading our passenger carriers' beyond rights in Japan for increased transpacific opportunities would be in the best economic interest of our Nation. I hope any such study or report would address the findings of the Booz Allen study. With respect to the 1952 carriers, I am particularly curious what leverage, short of trading existing rights, we have to offer the Japanese in exchange for new transpacific routes. For instance, as United States carriers form alliances with Japanese carriers, will the Government of Japan have a self-interested motive to increase transpacific routes to maximize the feed of passengers originating in the United States onto Japanese carriers who code-share with our carriers? Of course, the impact each approach has on consumers must be given great weight. I look forward to learning from MOU carriers and 1952 carriers what effect the approaches they advocate will have on consumer choice and the fares that consumers pay. As I have said repeatedly, I believe our international aviation policy decisions should be based on a careful weighing of national economic benefits and costs. Simply put, the goal of international aviation policy should be to maximize national wealth. In light of our more than $65 billion trade deficit with Japan, it is absolutely essential that approach be the guiding principle in current and future aviation negotiations with the Japanese. Exhibit Remarks by Robert L. Crandall Thank you, Bruce, and good afternoon, Ladies and Gentlemen. It's a pleasure to be here and as always, I am pleased to have an opportunity to talk with you about the ever-changing * * * and always challenging * * * business of international aviation. I'd like to spend our time together today on the subject of bilateral negotiations, an aspect of our usually fast-paced industry about which most of the news has to do with what's not happening, as some either drag on, and on, and on, and on--and others simply don't take place at all. Bilateral aviation discussions between the U.S. and other countries are invariably intense and difficult, for a variety of reasons. One of the most important is that the United States is a very large country, with many competing airlines--which typically offer various competing agendas to U.S. negotiators. Conversely, most other countries are, at least by comparison to the U.S., relatively small and, in most cases, have only one international airline. The result is that in most bilateral situations, our opponents have far more focused goals than we do. With respect to Japan, a country with which the U.S. has been unwilling even to launch passenger negotiations, the situation is similar, but modestly different. Japan is a very consensual society and although there are two international airlines, both are willing to accept administrative guidance--or something akin to it--from their government. In the U.S., on the other hand, there is little consensus on any aspect of international aviation and no agreement whatever as to either the tactics or strategy our Government should pursue with respect to Japan. Northwest and United, which have extensive rights, are vehemently opposed to changes while carriers like American, Delta and Continental, which have few rights to Japan and little access to the rest of Asia, think dramatic change is clearly called for. And passions run high, for access to Japan, and the rest of Asia, is critically important to every internationally oriented U.S. carrier. To compete effectively here in the United States, each such carrier seeks to build the strength of its route network by maximizing the number of origination- and-destination combinations it can offer its customers--and each wishes to include as many international points as possible. From Americans' perspective, the U.S. Government's unwillingness to open passenger negotiations with Japan, and our consequent inability to gain any meaningful access to the huge and fast-growing Asian market, is extraordinarily frustrating. That is particularly so since we think substantial progress could be made--if only our Government would act in accordance with its own, very recently articulated international aviation policy statement--a point I'll come back to in a minute. Let me take a moment first to examine the stakes of the game. As I think everyone here probably understands, service rights to Japan are the indispensable key to participation in Asian markets, for several reasons: One is that today's aircraft do not have the range to fly from most major U.S. hubs to most Asian capitals. Thus, U.S. carriers without the right to use Japan's airports as intermediate hubs are simply unable to participate in the U.S. Asia market. While the Japanese probably will not grant U.S. carriers like American and Delta the beyond rights we need to solve this problem directly, it seems quite likely that if we had adequate rights across the North Pacific, we could participate in Asia by means of code-sharing agreements with Japanese carriers. Thus, we think additional transpacific rights and the key to broadened American participation in Asia's aviation future. Second, Japan is Asia's pre-eminent economic power, by a wide margin. Given its dominance, a very high percentage of those traveling to and from Asia want to include Japan in their itineraries. As a consequence, Tokyo and Osaka are the only cities that can effectively serve as intermediate points between the major U.S. hubs and the principal cities of Asia--a point with which even the incumbent U.S. carriers agree. In addition to being an essential component of any global network, there is lots of evidence that Japan is woefully underserved from the United States. Consider these facts: Although Japan has a larger economy than Germany, the U.K. and France combined, fewer U.S. cities have nonstop service to Japan than to any one of those countries. Fares between the U.S. and Japan--on a revenue-per- passenger-mile basis--average 29% more than fares between the same U.S. cities and the principal cities of Europe. Despite being badly underserved, the U.S.-Japan market numbers 1.0 million passengers per year and is the world's second largest intercontinental market, exceeded in size only by that between the U.S. and the U.K. one can only imagine how large it will be when it is properly served! Unfortunately, it is not clear it ever will be, for our aviation relationship with Japan is prey to two severely complicating factors: [[Page S 16102]] The first is the unique route rights established by the U.S.-Japan aviation bilateral, which dates from 1952 and enables two U.S. carriers--Northwest and United--to exercise virtually unrestricted authority to fly from almost anywhere in the U.S. to Japan--and beyond Japan to other points in Asia. To illustrate that point, let me point out that during the last 18 months, Northwest has added more new flights to Japan than American operates in total. The beyond rights held by United and Northwest are startlingly different from those granted by any other nation to third-country carriers and have enabled Northwest and United to build cohesive Asian networks and establish hubs on both sides of the Pacific. Using this structure, the two carriers can thus participate in all four types of network traffic: First * * * between gateways--from Chicago to Tokyo, for example: Second * * * from behind a U.S. gateway to the foreign gateway--from Cleveland to Tokyo, via Chicago. Third * * * from a U.S. gateway to beyond the foreign gateway--from Los Angeles to Bangkok, via Tokyo. And finally: From behind a U.S. gateway to beyond a foreign gateway--as in from Boston to Singapore, via Detroit and Tokyo. Their fifth freedom rights also allow Northwest and United to carry large amounts of traffic between Japan and other points in Asia, thus depriving the Japanese carriers of traffic they regard as theirs, and complicating Japan's aviation relationships with some of its Pacific neighbors-- notably China, Thailand, and Australia. Not surprisingly, both the Japanese Government and the Japanese airlines regard these arrangements as unbalanced-- and by the standards of international aviation, they are, indeed, unbalanced. Other U.S. carriers have much more limited rights. While the 1952 agreement permits both countries to designate multiple airlines, Japan has essentially ignored that proviso for nearly 20 years. Since 1982, Japan has consented to only three very limited grants of additional routes, each memorialized in a memorandum of understanding. The net effect has been to create two classes of U.S. airlines serving Japan: The two so-called ``1952 agreement'' carriers, which have very broad rights, and three other airlines--American, Continental and Delta--known collectively as the ``M.O.U. carriers''--each of which is subject to substantial restrictions on routes and frequencies, and none of which can operate beyond Japan. Now as we all know, airlines are network businesses. To optimize traffic flows, each of the major U.S. carriers operates a number of hubs, which it uses to provide nonstop service to as many places as economically feasible in order to maximize the number of origin-destination markets it can offer its customers. The fact that only two U.S. carriers can offer customers in the United States a variety of Asian destinations has significant, adverse competitive consequences for those who can't. The other factor complicating our aviation relationship with Japan is the unwillingness of the U.S. Government to apply its recently articulated statement of international aviation policy to relationships with that country. Our government's international air transportation policy statement, issued last April, clearly enunciates the most important U.S. policy objective as--and I quote--to ``increase the variety of price and service options available to consumers.'' A second objective is to--and here I am quoting again--``provide carriers with unrestricted opportunities to develop types of services and systems based on their assessment of marketplace demand.'' Unfortunately, the U.S. has declined to pursue those objectives in its aviation negotiations with Japan. Apparently mesmerized by the notion that the beyond rights held by Northwest and United are uniquely valuable, the U.S. has adopted a civil aviation policy toward Japan that seems intended to protect the economic interests of two carriers-- and let competition, competitors and consumers take the hindmost. In my view, ladies and gentlemen, that's bad policy--and particularly so since it stands in sharp contrast to our government's aggressive application of pro-consumer policies in other negotiations. Moreover, this pattern of protectionism is not new. Successive U.S. Transportation Secretaries have pledged to eliminate the disparity between the have-not carriers and the Northwest/United duopoly. In 1985, D.O.T. premised its approval for United's acquisition of Pan Am's Pacific routes on United being made ineligible for new Japan routes in future D.O.T. proceedings. During the 1989 U.S.-Japan negotiations, then-Secretary Sam Skinner gave as one of his objectives: ``The enhancement of the operating rights of the so-called M.O.U.-carriers.'' When it instituted the 1990 U.S.-Japan route proceeding, D.O.T. said it would base awards on--I am quoting now--``The overall structure and level of competition in the U.S.-Japan market,'' end of quote--and would also give weight, and again I quote, ``To expanded service by those with only limited U.S.-Japan authority''--unquote. All those promises notwithstanding, our Government's actions in recent years have only enhanced the market domination of the United-Northwest duopoly. In the 1990 proceeding, our Government granted the most important new route--Chicago-Tokyo--to United, and then proceeded to give two of the remaining routes to airlines unable or unwilling to fly them--which promptly sold them to Northwest. The bottom line: three of the six routes available in 1990 ended up in the hands of the Northwest/United duopoly--despite D.O.T.'s promise to strengthen the M.O.U. carriers. So here we sit. Since deregulation--which sometimes seems like just yesterday, but which actually occurred 17 years ago this month--we have transformed American from a domestic airline to a global competitor--but we remain shut out of Asia. Delta and Continental have had equally little success. It is time for a change--and if the U.S. will apply its stated international aviation policy, we think change is possible. For more than a year now, the Japanese Government has been signaling a willingness to expand service between the U.S. and Japan, and to work out arrangements to rebalance our relationship. We believe Japan's Government recognizes that it cannot realistically hope to withdraw the beyond rights Northwest and United already operate--but that it does want to constrain the further growth of their beyond operations. In our view, a U.S.-Japan agreement premised on limiting the expansion of beyond operations by the duopolists, in exchange for a substantial increase in operating rights between various U.S. cities and Tokyo and Osaka, would be good for consumers, good for competition within the U.S. and across the North Pacific, good for the U.S. trade balance with Asia overall, and fully consistent with the D.O.T's international aviation policy statement. Such an agreement would trade beyond-Japan rights that Northwest and United do not now use, and may never use, for authorities that American and other ``have-not'' U.S. carriers are prepared to operate today. These new U.S.-Japan services would have many favorable effects: (1) more competition within the U.S., (2) more competition, and lower prices, across the North Pacific, (3) more travel, by more visitors, to and within the U.S., with all the attendant increased employment and wealth creation such increases create, (4) and more orders for U.S.-built aircraft. In addition to seeking a rational accommodation with Japan, which will provide more transpacific opportunities for more U.S. carriers, the U.S. can--and should--act affirmatively to optimize the value of its route rights with other Asian countries. For example, the use of Japan as an intermediate point has long been a bone of contention between the U.S. and China--and thus, our negotiators have had little success in modifying the U.S.-China bilateral. China's Government wants nonstop service--which American and others stand ready to provide--but has not been willing to allow any new U.S. carriers to provide it so long as Northwest and United insist on serving their country via Tokyo. By accepting China's position that a Japanese intermediate point may not be used in U.S.-China service, the U.S. would improve its aviation relationships with both Japan and China. Bettering both flight links and other relationships with China, with which the U.S. already has a huge and growing trade deficit--and whose future seems limitless--is clearly very important--and everyone wants a better relationship with Japan. Aviation disagreements do not defy resolution. Countries that dislike bilaterals enough eventually renounce them--as the U.K., France, Italy, Peru, Thailand, India and others have done with respect to the U.S. at one time or another. In a comparative sense, Japan certainly has a far more legitimate complaint than the U.K. had in 1976, when it renounced Bermuda I. Japan has already begun to restrict various rights held by U.S. carriers and the recently launched U.S.-Japan cargo negotiations are making little if any progress. In my view, the U.S. would be wise to initiate comprehensive negotiations now. Although proceeding under provocation is not ordinarily an advisable course, I do not see how U.S. interests are well served by protecting doupolies at the expense of reason, consumers and competition. This is especially true since the Japanese Government apparently seeks more comprehensive discussions, which would lead us to believe that mutual accommodation is likely. Assuming the U.S. is willing to adopt a stance consistent with its international aviation policy statement, as it has in other bilateral negotiations, we believe the time is right for a settlement consistent with the best interests of all parties. A passage from Shakespeare's ``Julius Caesar'' says it far more eloquently than I can: There is a tide in the affairs of men, Which, taken at the flood, leads on to fortune; Omitted, all the voyage of their life Is bound in shallows and in miseries. On such a full sea are we now afloat, And we must take the current when it serves . . . Exhibit 2 Remarks by Stuart I. Oran Good morning. It's a pleasure to be with you today. I am delighted to have this opportunity to talk about United's vision of aviation in the next century--global networks providing seamless service for our customers. Perhaps we can look to the telecommunications industry for a model of our vision for the future of global aviation. There, U.S. [[Page S 16103]] companies have developed a truly global service network. You can pick up your phone and call anywhere in the world, yet deal only with one of a number of companies. This network, which we take for granted, is the product of carefully integrated systems, cross-border alliances, realistic government regulation and forward thinking telecommunications companies. We believe that consumers are entitled to that kind of ease and convenience from airlines as well. A passenger should be able to deal with a single carrier for an itinerary that takes him anywhere in the world. To do this, we need a network of alliances--of rights and beyond rights--for carriers. Everyone understand the importance of beyond rights of networks today, but they didn't in 1976, when Bermuda II was under discussion. Ambassdor Alan Boyd of the U.K. offered testimony to the House Subcommittee on Aviation on the need to renegotiate the Bermuda I Agreement of 1952, calling it unfair to the U.K. He told committee members that under the agreement, U.S. airline revenues were twice those of the U.K. And he concluded that the only way to rectify the disparity was to rewrite the Bermuda Agreement substantially. Ambassador Boyd was correct on one point--a significant revenue imbalance did exist between the U.K. and the U.S. But the reason for the imbalance had little to do with route assignments or agreements. It had to do with competitive market forces and the then inability of a bloated, protected, government-owned British Airways to compete. How times have changed. Unfortunately, Congress and government regulators went along with Ambassador Boyd. The results, as we know too well today, was Bermuda II. That new agreement created dramatic structural advantages for the U.K. out of a growing European market. Since then, the U.S. market share between the U.K. and the U.S. had dropped 25%. But even more important, that agreement effectively locked the U.S. carriers out of the key connecting complex in Europe--Heathrow. In effect, U.S. carriers were punished for their efficiency. We've spent the past 19 years trying to correct the Bermuda II mistakes. I recount this today not to rub new salt into old wounds, but to look at the lessons of the European market. We would like to make sure that history does not repeat itself--this time in Asia. For nearly 25 years, the 1952 Japan Air Service Agreement enabled competitive parity between U.S. and Japanese carriers. It was not until 1986, when United acquired Pan Am's rights in the Pacific, that the parity began to dissolve. The reason was simple--United took the necessary and often painful steps to becoming more efficient in the newly deregulated U.S. market. Meanwhile, the Japanese carriers, operating in a highly protected environment, avoided similar changes. The result today is that Japanese costs are considerably higher than those of their U.S. competitors. Let me underscore just how much higher those costs are. We commissioned Booz-Allen & Hamilton to conduct a major study-- to be released today--on the value of Asian beyond rights to the U.S. economy. Among their key findings was that Japanese carriers' cost are now roughly double that of U.S. carriers at comparable stage lengths. The fact that the Japanese flights are more expensive is not lost on the traveling public. Because of our efficiency, we have developed fares and schedules preferred by the Japanese consumers. As a result, the parity that long existed between U.S. and Japanese carriers is gone. Today, U.S. carriers provide 61% of the capacity serving Japan and the U.S. enjoys a $4.8 billion net trade surplus with Japan for passenger air travel in Asia. Rather than respond to this competitive challenge by restructuring their airlines--a change that is unavoidable at some point and that will benefit the Japanese people in the long run--the Japan Ministry of Transportation (MOT) has chosen instead to vilify the 1952 Air Service Agreement. Their claim is that the `52 agreement is unfair and gives the U.S. a competitive advantage. Does this sound familiar? Like the British did in the `70's, the MOT is blaming the agreement rather than their own protectionist aviation policies for their declining transpacific market share. So MOT has decided not to honor the `52 agreement. Most recently, the MOT has denied a request by United Airlines to begin flights between Osaka and Seoul, despite our right to fly unlimited routes between Japan into Asia. By denying this request, the MOT is abrogating the treaty, and attempting to force the U.S. to negotiate for a right its carriers already have. To add insult to injury, JAL is at the same time seeking to expand flights from Sendai to Honolulu. We are asking the Department of Transportation today to deny any increase in JAL's service until our Osaka-Seoul business plan has been approved by MOT. MOT's position ignores an important lesson we learned with British Air and Bermuda I. Competitive positions are not static. Of course, the Japanese carriers will improve efficiency over time as they continue to cut costs and improve service. For the U.S. to overreact now, and surrender critical U.S. carrier beyond rights, would be a sucker deal that would put all U.S. businesses at a permanent disadvantage in the exploding Asian market. I can not underscore this important idea strongly enough. Ultimately, this is not just about United. It's about trade and MOT's approach to trade disputes in the aviation sector. It's about Japan's drive to monopolize the U.S.-Asia and Japan-Asia markets. In this case, MOT believes it can unilaterally interpret or simply ignore agreements with impunity when it suits them. And they have little regard for the damage this strategy causes to international relationships, or the havoc it wreaks on the marketplace. And just how much havoc will MOT cause? According to Booz- Allen, if the U.S. gives up its beyond rights as MOT wants, Japan would receive a virtual monopoly on U.S.-Asian routs through Japan; Japanese carriers would gain up to $5 billion in present value from the earnings stream lost by U.S. carriers, and the U.S. would suffer a trade loss in excess of $100 billion over the next twenty years, the bulk of which would be transferred to Japan--$100 billion. Let me describe some more of the consequences of MOT's strategy. MOT's strategy will hurt the U.S. economy.--If MOT succeeds in blocking U.S. beyond rights, the Booz-Allen estimates of a cumulative trade loss of $100 billion dollars is actually conservative. That impact would be compounded by the multiplier effect on U.S. jobs and economic activity. As a result, the entire U.S. economy would feel the sting of MOT's aviation whip. MOT's strategy will hurt consumers.--Booz-Allen predicts that if the U.S. carriers lost all or any of their rights to carry passengers beyond Japan to other Asian cities, capacity will drop and fares will increase. Consumers will lose service alternatives, not only between the U.S. and Japan, but to other Asian cities as well. Travelers will pay more and get less. MOT's strategy hurts U.S.-Japanese relations.--Their plan makes a mockery of the 1952 Air Service Agreement. If MOT is allowed to dishonor the 1952 accord, how can it be trusted to respect other bilateral agreements? And we certainly can't expand their routes into and beyond the United States if they won't honor existing treaties. MOT's strategy will impose a stranglehold over Asian aviation.--MOT is trying to position Japan as the gatekeeper of Asia, by controlling traffic both into and out of the continent. If it is successful in hobbling U.S. carriers, it will then turn its attention to the other competition, the Asian Carriers. In short order, we would see a steady stream of Asian carriers--Chinese, Indonesian, Korean, Malay, Taiwanese, Thai and Singaporean--forced to beg MOT for beyond rights to North and South America. And without the counterweight of U.S. competition, Asian carriers would become prey in their home markets to the predatory Japanese airlines. MOT's strategy hurts U.S. carriers.--U.S. carriers will lose the right to grow in Asia--the region projected to have the highest growth in air passenger transportation over the next 15 years. How does United see the preferred course for the future? Using Europe as a model, we see 4 or 5 major alliances forming the core of services in Asia, with many niche players finding important roles. There is no reason why this model can't be a win-win situation for everyone in Asia. The alliances into which United has entered are designed to achieve a global network, including Asia. We have no problem with others entering the same kind of alliances, for example, the two principal Japanese carriers with U.S. carriers-- because we believe that when equitably administered, we can beat the competition. But first, MOT must honor the existing terms of the 1952 accord. This must be a prerequisite for passenger talks. Once all parties involved agree to respect the 1952 pact, we would encourage the U.S. Department of Transportation to develop a detailed economic analysis of Japanese aviation and its relationship to U.S. carrier competitiveness in Asia. We would urge that DOT use that analysis as a starting point for negotiations with MOT. Japan's carriers may today be overpriced and unresponsive to consumers' needs just as British Airways was 20 years ago. But the solution is not to lock up the skies and give Tokyo the key. To do so would simply recreate the mistakes of Bermuda II. The solution to this dispute must respect the principle of open competition. We see it working in Europe, where competitive alliances provide a blueprint for global aviation. The solution must acknowledge that competitive position are not static. One way or another, Japan's carriers will have to modernize and those changes will affect their standing in the air travel marketplace. And above all, the solution to this dispute must honor existing agreements before creating new ones. Going back to our telecommunications analogy, we want to provide a ``seamless'' journey for passengers. With a progressive, sound, and resolute U.S. approach to international aviation matters, we believe that this goal can be achieved on a global basis. But as long as we allow one nation to control international air space, there can be no global aviation. Not today. And certainly not in the year 2010. Thank you. I look forward to your questions.

Mr. PRESSLER. Mr. President, I rise today to discuss the critically important issue of United States aviation relations with the Government of Japan. Last month, the United States commenced talks with the Japanese aimed at liberalizing the transpacific cargo market. This is a welcome development and I hope an agreement liberalizing cargo service opportunities can be reached by no later than March of next year--the mutually agreed upon timetable. Clearly, consumers of cargo services on both sides of the Pacific would be the big winners if such an agreement is struck. Talks on more contentious passenger carrier issues have not been scheduled. As should now be clear from the numerous floor statements I have made in this body in recent months, I have a keen interest in United States- Japan aviation relations. As Chairman of the Committee on Commerce, Science, and Transportation, I will continue to make it a priority. At the outset of my remarks today, let me emphasize several related points. Although these remarks refer primarily to passenger carrier issues, they apply with equal force to cargo relations with the Japanese. First, from a long-term perspective and due to its key strategic location in the Asia-Pacific aviation market, aviation relations with the Japanese unquestionably are our single most important international aviation relationship. At the same time service opportunities in Japan are expanding, air service markets in Asian countries best accessed through Japanese gateway airports are growing at an astounding rate. Simply put, meaningful participation in the rapidly expanding Asia- Pacific market is absolutely critical for the long-term profitability of our airline industry. For instance, the International Air Transport Association estimates that between 1993 and 2010 scheduled international passenger service in Vietnam will grow at an average annual rate of 17.3 percent. International air service opportunities in China are expected to grow at an annual rate of 12.6 percent over the same period. Overall, it is expected the Asia-Pacific market will account for approximately 50 percent of world air traffic by 2010. Second, geographic factors coupled with the limited range of commercial aircraft make it essential that carriers seeking to effectively serve these rapidly expanding Asia-Pacific markets can provide that service from Japan either directly or indirectly through a Japanese code-sharing partner. As distinguished from the bottleneck at London's Heathrow International Airport, overflight to markets beyond Japan is not an option since the distances to these markets from the United States are too great. Moreover, as shown by recent unsuccessful experiences, serving the Pacific-Asian market through other gateway countries does not appear to be a viable alternative. Third, aviation relations with Japan are a very important national trade issue and it is imperative they be treated as such. Indeed, discussion of air service opportunities to and beyond Japan is one of the United States' most important trade issues being discussed with any of our trading partners. The stakes in these talks are enormous. For example, the United States currently enjoys an approximately $5 billion net trade surplus with Japan for passenger air travel in the Asia- Pacific market. I cannot emphasize strongly enough the importance of our current and future aviation negotiations with the Japanese. Handled properly, air service negotiations with the Japanese could enhance the ability of our passenger and cargo carriers to participate in the rapidly expanding Asia-Pacific market. Handled poorly, the adverse trade consequences could be colossal. Fourth, what the Japanese are seeking in these negotiations is not to level the playing field as they suggest. Let there be no mistake, the Japanese are seeking no less than to tilt the competitive playing field in such a way as to enable their less efficient carriers to compete more effectively against our carriers. Our passenger carriers serving the Asia-Pacific market have operating costs approximately half those of their Japanese counterparts. The Government of Japan claims the United States-Japan bilateral aviation agreement is fundamentally unfair and is solely responsible for the greater market share our passenger carriers enjoy on service between the United States and Japan. The facts do not support such a position. Just 10 years ago, under the very same bilateral agreement the Government of Japan now criticizes, Japanese carriers had a larger market share on transpacific routes than United States competitors. What is the truth? As a June 1994 report by Japan's Council for Civil Aviation noted, the fact is our carriers became more competitive by lowering operating costs while Japanese carriers continue to be high cost carriers. Similarly, the Government of Japan claims our carriers have abused their beyond rights and unfairly dominate beyond markets. Again, a claim without merit. Currently, Japanese passenger carriers have a 34 percent share of the Japan-Asia market while United States passenger carriers have just 13 percent of that market. Moreover, our cargo carriers have only approximately 14 percent of the Japan-Asia market. The facts speak for themselves. Having made these points--points I believe are critical to the United States-Japan air service relations debate--let me turn to the question of what our goal should be in current and future negotiations with the Japanese. Uncharacteristically, our carriers seem to speak with one voice in saying we need to seek to liberalize passenger and cargo carrier opportunities with the Japanese. There is disagreement, however, with regard to what strategy our negotiators should pursue to accomplish this goal. In recent weeks it has become readily apparent the debate regarding negotiating strategy will be shaped by two fundamentally different views. To better understand these views, one must remember that our carriers which currently serve Japan can be separated into two distinct groups based on the types of service they are authorized to provide. The first group of carriers are the so-called MOU carriers. These carriers--American Airlines, Delta Air Lines, Continental Airlines and United Parcel Service--are permitted by a Memorandum of Understanding signed in 1985 to provide service from specific cities in the United States to specific Japanese cities. MOU carriers cannot use Japan as a base of operation to directly serve emerging Asian markets beyond Japan. They can, however, participate in those markets through code- sharing alliances with Japanese carriers. In fact, Delta's recently announced alliance with All Nippon Airways will permit it to do precisely that. The second group of carriers, whose rights are derived from the United States-Japan bilateral agreement signed in 1952, are permitted to fly to Japan, take on and unload passengers and/or cargo, and to fly on to cities throughout Asia. Unlike the MOU carriers, the so-called 1952 carriers--Northwest Airlines, United Airlines and Federal Express Corp.--have beyond rights. Northwest was a party to the 1952 agreement. In 1985, United Airlines purchased its beyond rights from Pan Am in a $750 million transaction and Federal Express acquired the beyond rights of Tiger International, Inc. in a 1989 transaction valued at more than $1 billion. In a recent speech, Bob Crandall, the Chairman of American Airlines, set out a possible negotiating strategy for United States-Japan aviation relations. I anticipate other MOU carriers will embrace the strategy Mr. Crandall advocated and I therefore refer to it as the ``MOU carrier approach.'' Recognizing the Japanese are unlikely to grant beyond rights to MOU carriers, Mr. Crandall urged our negotiators to focus on increasing transpacific opportunities between the United States and Japan. In addition to [[Page S 16101]] tapping expanding service opportunities in Japan itself, Mr. Crandall explained such an approach would enhance the ability of United States carriers to feed traffic into Asia-Pacific networks, including the planes of Japanese code-sharing partners who serve markets beyond Japan. What makes Mr. Crandall's speech notable is not so much his insightful view of the focus our negotiators should take. Rather, it is the strategy he recommends that is remarkable. In exchange for increased transpacific routes, Mr. Crandall recommends our negotiators should offer to cap the beyond rights of United Airlines and Northwest Airlines. As Mr. Crandall put it, ``[s]uch an agreement would trade beyond-Japan rights that Northwest and United do not use, and may never use, for authorities that American and other `have-not' U.S. carriers are prepared to operate today.'' I ask unanimous consent that a copy of Mr. Crandall's speech to which I have referred be printed in the Record at the conclusion of my remarks.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, as a long-standing member and now Chairman of the Commerce, Science and Transportation Committee, I have been an outspoken critic of movie and television programs that have a negative impact on our children. However, I do make a point to single out those who make a positive contribution to quality programming. Today I want not only to pay tribute to an individual who has worked diligently to create programs that uplift and instruct our children, but also to extend congratulatory birthday greetings. Henry Winkler, an individual who already has established a milestone in television history, will celebrate another milestone on October 30, when he turns a golden fifty years of age. All of us know Henry Winkler as the ``Fonz'' on the long running TV show ``Happy Days''. His famous motorcycle jacket is a permanent piece of the Smithsonian Institute's collection. As an actor, Mr. Winkler created a national icon. Today, he has established himself as one of Hollywood's most respected producers of family-oriented entertainment, and has drawn attention to humanitarian and family causes. In the 1970s, he won the prestigious Humanitas Award for his program ``Who Are the DeBolts?'', a documentary on a family with nineteen children, many of them adopted with special needs. In the 1980s, Henry brought back the ``Fonz'' to host the video ``Strong Kids, Safe Kids'', a widely distributed cassette that addressed child abuse. His production company, ``JZM''--the initials derived from each first name of his three children--produced children's specials addressing a variety of important issues such as divorce and teenage drunk driving. Families also have enjoyed the exploits of ``MacGyver'', the story of an action hero who solved crimes with creativity and scientific knowledge, rather than guns or brute violence. Henry also continues to act, portraying characters who invariably learn or teach a heartwarming lesson, including last year's ``Truman Capote's One Christmas'', in which Henry co-starred with the legendary Katherine Hepburn. As both actor and producer, Henry has proven that good, clean programming can be entertaining, and as the ``Fonz'' would say, cool. Henry Winkler's devotion and commitment to quality programming stems from clear fact: Henry Winkler is a quality human being. He has applied this same energy to the welfare of all children. He is a founding member of the Children's Action Network, dedicated to raising the profile of children's issues through the media. He has been national chairman of the annual Toys for Tots campaign, honorary chairman of the Epilepsy Foundation of America, the Special Olympics, and numerous teenage alcohol and drug abuse programs. In recognition of his many humanitarian efforts, Henry Winkler has been honored by the United Nations, B'nai B'rith, Women in Film, and Cedars-Sinai Medical Center. Also honored by Hollywood, Mr. Winkler has his own star on the ``Walk of Stars''. In both his personal and professional life, Henry Winkler set a positive and highly respected standard for the entertainment industry. My wife, Harriett, and I join Henry's family and friends in wishing him a very happy birthday, good health and best wishes for another half-century of continued success.