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Smith, Iowa Mr. Thompson of New Jersey with Mr. very strong, one of the great economic Macdonald Poff
accomplishments of the American way. MacGregor Pool
The industry in Canada is much weaker, Machen Powell
Mr. Cameron with Mr. Mailliard.
only about one twenty-fifth the size of
Mr. Hays with Mr. Collier.
the industry here in the United States. Madden Purcell
In recent years the importation of
Mr. Roncalio with Mr. Ryan.
automobiles and parts into Canada has Martin, Nebr. Race
resulted in an imbalance in the Canadian
Mr. Edmondson with Mr. Hagen of Cali- balance of payments to the extent in Matsunaga Redlin
1964, as I recall, of nearly $600 million. Meeds
Mr. Celler with Mr. Kee.
Mr. Chairman, the increased impor
Mr. Jarman with Mr. Bonner.
tation of automobiles and parts into Miller Resnick
Teague, Calif. Mr. Flynt with Mr. Ullman. Mills
Canada brought about a degree of con-
Teague, Tex. Mr. Young with Mr. Edwards of California.
cern in that country that resulted in the Mink Rhodes, Pa. Thompson, Tex.
establishment of a practice known as the
vote from "nay" to "yea."
discuss in detail, but which disturbed
The result of the vote was announced
certain producers of automobile parts Moore Rodino Tunney as above recorded.
here in the United States no end. Efforts Moorhead Rogers, Colo. Tupper
The doors were opened. Morgan
were made, and were actually successful, Rogers, Fla. Tuten
A motion to reconsider was laid on I think, in demonstrating to our GovernMorris
Rogers, Tex. Udall Morrison Ronan
the table. Utt
ment that this was contrary to our own Morton Rooney, N.Y. Van Deerlin
best interests, and it would have been Mosher
Rooney, Pa. Vanik
AMEND SECTION 510 OF MERCHANT necessary, I think, although there is
some dispute, for the United States to Murphy, Ill. Rostenkowski Waggonner
have initiated countervailing duties had Murphy, N.Y. Roush
Walker, Miss. Mr. GARMATZ. Mr. Speaker, I ask Murray Roybal Watkins unanimous consent to take from the the producers of automobiles in Canada
this remission on the part of Canada to Nedzi
not been rescinded.
I do not know what would have hapO'Brien St. Onge Whalley
rine Act, 1936, with a Senate amendment pened. No one knows what would have O'Hara, , Scheuer White, Idaho
thereto, disagree to the Senate amendO'Hara, Mich. Schisler
White, Tex. O'Konski
happened. It is entirely possible that Schmidhauser Whitener
ment, and agree to the conference asked there existed at least the seeds for a Olson, Minn. Schneebeli Whitten
by the Senate. O'Neal, Ga. Schweiker Widnall
trade war between this very friendly ally
The SPEAKER. Is there objection to of the United States and the United O'Neill, Mass. Scott
Wilson, Bob Ottinger
the request of the gentleman from States itself. This could have been disSelden
Maryland? The Chair hears none and astrous to the trade between the two
appoints the following conferees: Messrs. countries, Canada and the United States. Pelly Shriver
Mr. Chairman, we should bear in mind
that Canada still remains the prime imPhilbin Sisk
porter of American products.
AUTOMOTIVE PRODUCTS TRADE The automobile industry itself was
ACT OF 1965
concerned about the possibilities of such NAYS—23 Baring Cleveland Marsh
Mr. MILLS. Mr. Speaker, I move that a trade war because the industry here Bates Curtis Natcher
the House resolve itself into the Com- in the United States is largely the owner Belcher Duncan, Tenn. Olsen, Mont. mittee of the Whole House on the State of the subsidiaries that are its counterBow Gross Roudebush
of the Union for the consideration of the part in Canada. The Government itself Brademas Grover Secrest
here and apparently the Government in Bray Haley
bill (H.R. 9042) to provide for the im
Stubblefield Broyhill, N.C. Hall
Walker, N. Mex. plementation of the Agreement Concern- Canada was concerned about it. The Callaway McClory
ing Automotive Products Between the union which represents most of the autoNOT VOTING—46
Government of the United States of mobile industry, including the parts inAnderson, IuEdwards, Ala. Mailliard America and the Government of Canada, dustry here in the United States, was Andrews, Edwards, Calif. Martin, Mass. and for other purposes.
greatly disturbed about what had hapGeorge W. Evins, Tenn. Matthews Andrews,
pened and the automobile industry of the
United States had reason to be conGlenn Gallagher Passman
IN THE COMMITTEE OF THE WHOLE
cerned, of course, because it has become Bonner
Accordingly, the House resolved itself a practice that we do not like for counRoncalio Hagen, Calif. Cameron Hays
into the Committee of the Whole House tries of the world to impose restrictions Celler Hébert Saylor
on the State of the Union for the consid- and limitations upon the import of Clawson, Del Herlong
eration of the bill H.R. 9042, with Mr. American-made automobiles of the kind Collier Jarman Thompson, N.J. DONOHUE in the chair.
and nature such as to prevent the friendCorman Kee
The clerk read the title of the bill.
ly acquisition of these very fine machines Dickinson Landrum Williams
By unanimous consent, the first read- and parts in all of the markets in the Diggs Lindsay Willis ing of the bill was dispensed with.
world. Edmondson McEwen Young
Mr. MILLS. Mr. Chairman, I yield For instance, Mr. Chairman, Australia So the resolution was agreed to. myself 15 minutes.
requires that 90 percent of the automoThe Clerk announced the following Mr. Chairman, the bill presently be- bile itself be made in Australia in order to pairs:
fore the Committee of the Whole is the be sold in Australia. South Africa does Mr. Hébert with Mr. Saylor.
culmination of a situation that I would approximately the same thing. Brazil Mr. Willis with Mr. Edwards of Alabama. like to refer to briefly before getting into does approximately the same thing. Mr. George W. Andrews with Mr. Dickin- the provisions of the bill itself.
Mexico does approximately the same son.
Mr. Chairman, as all of us are aware thing, and wherever this situation exists, Mr. Diggs with Mr. Lindsay. Mr. Corman with Mr. Del Clawson.
there is an automobile industry in the because of the shortrun production
United States made up of the producers faced by the industry within that counMr. Evins of Tennessee with Mr. Glenn Andrews.
of automobiles and the producers of try, cars automatically sell to the conMr. Toll with Mr. McEwen.
automotive parts. At the same time sumer for a lot more than they do here Mr. Kornegay with Mr. Anderson of Illi- there is an automobile industry in Can- and a lot more than they would if they nois,
ada also made up of producers of auto- were permitted to buy parts from the Mr. Thomas with Mr. Martin of Massachu- mobiles and producers of parts. The United States and assemble them in those setts.
American automobile industry is very, countries.
There was some thought that Canada bile parts that are brought into Canada North American automotive industry so might be drifting into that kind of a by the automobile producers of Canada that a given model can be produced in situation which would be very detri- for use in new cars or in connection with Canada in greater number and thus exmental to the manufacturers of auto- the production of new cars, effective tend the production run and reduce costs mobile parts in the United States, the January 18 of this year. We had to limit of particular models for the Canadian manufacturers of cars in the United our part of the agreement along the same market. States, and to those employees of these line because Canada was not ready at I think the automotive industry and I concerns in the United States.
that point-she perhaps is not yet think the labor union that represents Mr. Chairman, sensing this situation ready-to provide for the complete elimi- these workers were exactly right in their and desirous of maintaining the very nation of all duties on all parts which conclusions when they testified before cordial friendly relationship that has ex- would mean the inclusion of replacement your committee that this bill was desired isted between Canada and the United parts.
by them. States over the years, the President of I have talked to a number of people I think I should call attention to the the United States and the Prime Min- who are in the parts production business fact that we have here a little different ister of Canada drew up and signed on here in the United States, and they have situation from what we have been having January 16 last, what is known as the told me, without exception--those that as some of these bills come before us. agreement concerning automotive prod- I talked tothey have no fear whatso- Here we have industry and labor toucts between the Government of the ever of complete free trade with Canada gether.
gether. That does not happen all the United States and the Government of in all parts, that they can here in the time. But in this instance we have the Canada Canada immediately put into United States produce those parts labor involved in the industry and we effect that which she agreed to do in cheaper and sell them cheaper than the have the management involved in the inthis agreement.
corresponding parts produced in Canada dustry, both telling us that this legislaThe President of the United States can be sold in the American market. tion should pass and that this legislation immediately started the process of carry. But there has been a great deal of sus- is in the long run for the best interest of ing out that which he had agreed to do picion, let me say, that the Canadian both management and employees in the on behalf of the United States.
automobile producers may have entered industry. Pursuant to this agreement Canada into some type of side agreement with
So I think it should not be unnoticed reduced her duties to zero under certain the Canadian Government which would that that is the case in this situation. circumstances. The President com- mean that the producer or assembler of
Mr. Chairman, we reported this bill in mitted himself to ask the Congress to cars in Canada would have to buy a June—I think it was on June 21. We implement this agreement during this Canadian-made part in preference to an revised the original bill that was subsession of the Congress.
American-made part, regardless of what mitted to us in some respects. Very Now, Mr. Chairman, the bill before us the difference in cost might be.
frankly, I wanted to know more about has as its primary purpose the imple- When we opened the hearings on this the reaction to it and the operation mentation of this agreement and the ad- matter I am sure each and every member under it. I wanted to know more about justment of American duties on automo- of the committee who heard the state- what might happen before we brought it biles and automotive parts going into ments expressing this fear were inter- to the floor of the House. I think we new automobiles, in keeping with what ested in exploring them, and we did ex- have had enough experience with the Canada has done and what we under- plore into what turned out to be letters of implementation of the agreement by take in the agreement to do through undertakings—not agreements—that we canada that I can assure the memberlegislation. That is the primary purpose found had been written by the Canadian ship of the House that though there may of the bill. There are some collateral automobile producer in response to a re- be some dislocation here and there as provisions such as the section of the bill, quest from the Canadian Government between particular manufacturers of I believe it is 202, which authorizes the setting forth what they thought they parts, I think I can assure the memberPresident to enter into similar agree- could do and what they would undertake ship of this House that this bill does not ments with other countries of the world, to do in the event such an agreement offer any threat to the continued operaif those countries are so disposed. were consummated by the United States tion and the continued expansion of the If he does this he has to report back and Canada.
smaller independent producers within to the Congress. We have a 60-day wait- There is no demand whatsoever on the this industry who are dependent for the ing period in which the Congress may act producer of Canadian automobiles to dis- sale of their products to the automotive adversely with respect to such an agree- regard price or to buy any given number manufacturers themselves as well as to ment if it is so inclined.
of parts or any kind of parts produced the general public who use cars and car In addition, that section also author- within the Canadian borders. Actually, parts. izes the President to enter into agree- there is this expression of intent to in
I am thoroughly convinced in my own ments to change the rate of duty with crease the Canadian value added of auto- mind that here is a golden opportunity respect to automobile parts that are to mobiles produced in Canada, an intent for us to set in operation machinery that go into used cars, that is, replacement and a desire and a hope that any suc- will inure to the benefit of the people of parts but here again such an agreement cessful business operator would have Canada-yes—but moreover it would incan also be voted on and voted down by taken into consideration in view of the ure to the benefit of the people of the the Congress if the Congress wants to do
fact that there is a higher percentage of United States as well. it within the 60-day period. In the ab- annual increased demand for automo
Mr. Chairman, I do not know of anysence of the agreement, if we try to ex- biles in Canada today than there is here thing that has received any more careful port an automobile into Canada and face in the United States. I said “percent,” consideration than this particular bill the Canadian duty, it would be 17.5 per- because they do not have as much popu- because I must say I viewed it with a cent. If Canada wants to export a like lation.
great deal of concern when it first came automobile into the United States the Now what would happen under this to us. I had many, many questions rate of duty is 6.5 percent. Both coun- agreement and under this legislation? about it and I think other members of tries are agreeing under certain circum- I think, Mr. Chairman, we can expect, . the committee had many questions. stances to reduce these rates of duties and confidently expect, that the automo
Most of these questions, if not all of to zero.
bile industry in the United States and them, have been resolved as we have In the United States we have a duty the automobile industry in Canada both
gone over this time and time again. of 8.5 percent on most parts that come will grow. Why do I say it? Because we
What is the situation if we do not pass into the United States to be used in cars will be developing for the first time, as
this legislation? We revert right back here in the United States. Canada has against what we have today; namely, to where we were, the Congress having rates of duty on corresponding United two separate industries—one of them
failed to implement this agreement. States automobile parts into Canada that having the experience of the short-line
At a minimum we could expect Canada go as high as 25 percent, and averages production in Canada, upping the costs to put back their duties on automobiles about 17 percent.
and the other our own more efficient in and parts—duties that are about three Canada agreed to immediately reduce dustry, a North American automotive times as high as U.S. duties. We do not to zero the rate of duty on the automo- industry. This will be an integrated know whether the least additional thing that Canada would do would be to re- than January 1, 1968, of progress made made so the Canadian Government store the remission-of-duties plan. We toward achieving the objectives of the could be confident that under the dutydo not know what Canada will do. But agreement.
agreement. At the end of this transi- free regime made possible by the agreethose who are concerned at the moment
tional period judgments can be made as ment, Canadian production would not about some parts producer here in the to what further steps toward achieve
to what further steps toward achieve- be swamped in the first critical years United States should remember that it ment of full integration of the industries by far greater U.S. production but would was the parts producer himself who and full free trade in automotive prod- share in the rapid growth of the Canafound fault with the Canadian remission- ucts can be taken.
dian automobile market. These letters of-duties plan to begin with and it is the Now, Mr. Chairman, what is the are not part of the agreement, but their U.S. parts producer who will once again United States obligated to do in fur- terms must be weighed in considering have to try to sell his parts into Canada therance of this historic step that our the potential overall effect of the agreeover the barrier of a high duty.
Government and the Government of our ment. I know I can assure the membership major trading partner have agreed to Because the adjustments that may that this arrangement is far better for
take—to lay aside the narrow objective take place in the industry during the the parts producer than was the or of maintaining walls of protection around transitional period and the elimination nal remission-of-duty scheme this agree- separate, autonomous, automotive in- of the duties all at one time—that is, ment supplants.
dustries, and remove the barriers to the without reduction by annual stages as In addition, there is nothing we can creation of a single, integrated North provided in the Trade Expansion Act of say by way of assurance that there could American industry? All the agreement 1962—the bill provides special adjustnot be established at the Canadian bor- calls upon the United States to do is to
calls upon the United States to do is to ment assistance procedures during the der a limitation on the imports of parts remove its already low duties on motor
remove its already low duties on motor transitional period for firms producing from the United States, which would cut vehicles and on original equipment to be
vehicles and on original equipment to be automotive products and their workers off or substantially cut off the export used in the manufacture of motor vehi- that are dislocated primarily because of from the United States of parts this year cles. The possible benefits to the United
cles. The possible benefits to the United the operation of the agreement. Now which, so far, for the first 5 months is States are great, and the risks repre- these procedures are admittedly more greater than it was in the first 5 months sented by the removal of these duties liberal than those provided for firms and of 1964.
are small. If either country should be- workers under the Trade Expansion Act It is not a choice between this agree- come dissatisfied with the way the agree
of 1962. But let me point out, Mr. ment and what we would want. That is ment is working, the agreement can be Chairman, that these special procedures not the situation. The choice is between terminated under its terms, upon 12
12 will apply only during the transitional this agreement and what another coun- months' written notice.
months' written notice. The Congress period, that is, until July 1, 1968, during try may decide it wants.
will be kept informed regarding activities which period parts and component supLet me point out, Mr. Chairman, that under the agreement by an annual re- ply sources may be shifted either within the agreement which this legislation is port from the President, as required by each country or between countries to concerned with does not establish com- Section 502 of the bill.
take advantage of the lower costs and plete free trade on automotive products
I mentioned temporary undertakings potential improvements in efficiency between the United States and Canada. made
by Canadian producers to increase made possible by the agreement and to While this country might be prepared to their Canadian production. The Com- carry out temporary undertakings made take that step at this time, we cannot mittee on Ways and Means heard much
by Canadian producers to increase their very well expect Canada to do so now. before the hearing on the bill about the
Canadian production. Furthermore, Our automotive industry is great and so-called side agreements that Canadian unlike the Trade Expansion Act adjustpowerful; Canada's is relatively small producers had made with the Canadian ment assistance provisions, which are and weak. As I stated, the Canadian in- Government, and we inquired into them properly limited to cases where injury dustry is about one twenty-fifth the size most thoroughly. They turned out to
or loss of employment is due to increased of our industry. Complete free trade now be private letters from the Canadian imports, adjustment assistance proviwould mean that our highly efficient in- automotive companies to the Canadian
sions of the bill take into account the dustry would simply take over the entire Government, sent before the agreement fact that dislocation may result not
only North American automotive market. was signed, in response to the Canadian
from an increase in imports from CanThis is not what we want to do to our Government's inquiry of Canadian pro
ada, but from a loss of exports. good neighbor, and it certainly is not ducers as to their plans for expanding United States-Canadian agreement is
I submit, Mr. Chairman, that the what the Canadians should be expected production of automotive products in to be willing to have us do. The agree- Canada.
a unique one designed to achieve an obment contemplates the achievement of Copies of these letters were supplied of trade
agreements that have been
jective going far beyond the objectives fully free trade in automotive products to the committee by the witnesses for by stages. It provides for limited free the four major companies. They are
made under trade agreements legislatrade in automotive products for a tran- reproduced in the committee report at
tion; namely, the integration of the sitional period under conditions that will page 43. Examination shows them to be
North American automobile industry. permit the Canadian sector of the in- "letters of undertaking,” requested from
The special adjustment assistance providustry to achieve a reasonable increase each company individually by the Ca
sions in the bill during the period of in her automotive production, while the nadian Government–intended to assure
transition from the present state of this U.S. manufacturers plan their produc- the Government that the signing com
industry to the greatly improved state tion so as to make the most efficient use pany will comply with the terms of the
that it will hopefully be in 1968 are of their plants whether in Canada or the agreement and will increase the dollar
accommodated to special circumstances United States. Since the Canadian mar
that may arise from the operation of value of the “Canadian value added” in ket is growing more rapidly than the its production of vehicles and original
the agreement. U.S. market, both sectors of the industry equipment parts by a stated amount. criticized as favoring workers in the
These special procedures have been should benefit.
The undertakings of all the Canadian automotive products industry over those The agreement contemplates this
companies taken together are undertransitional period as one of adjustment stood to total additional “Canadian
in other industries who must rely on the of both sectors of the North American value added” in the amount of approxi- visions of the Trade Expansion Act. I
more onerous adjustment assistance proautomotive industry for the stated objective of early achievement of a broader mately $241 million. This increase is to have shown, I believe, that these special market for automotive products, within be above the anticipated normal increase temporary provisions in the bill are dewhich the full benefits of specialization in production in Canada and is to be signed to meet situations not pertinent
under the Trade Expansion Act. and large-scale production can be more achieved during model year 1968. fully realized. Consultation may be had
The undertakings of the companies Now in addition to provisions authorat any time at the request of either Gov- are unilateral and are subject to quali- izing the President to implement the
United ernment on any matter relating to the fications about the effect of market con
States-Canadian automotive agreement, and the agreement provides ditions and other factors beyond the products agreement and those providing for a comprehensive review, no later control of each company. They were for adjustment assistance to firms and
workers adversely affected by the oper- shall be as rapid a reduction in prices agreement had been signed or anything ation of that agreement, the bill author- as the rise in efficiency will permit. else, perhaps the remission of duty pracizes the President to implement similar This intention has been plainly stated tice would have remained in effect on the agreements covering automotive prod. by the Canadian Prime Minister and the part of Canada. We must remember ucts with other countries as well as sup- Minister of Industry in debates in the that is what the producers or parts were plementary agreements with Canada and Canadian Parliament. Although the so concerned about. In my opinion, we such other countries with which original U.S. Government cannot and should not would not have seen the export of parts equipment agreements may be made, cov- attempt to dictate automobile prices to
attempt to dictate automobile prices to to Canada that we have seen this year if ering replacement parts. The reason for the Canadian companies, we can be
the Canadian companies, we can be the remission of duty scheme had not these additional authorizations, Mr.
Mr. certain that there will be continuous been eliminated from the picture. Chairman, is to encourage the extension pressure from a variety of interests for I cannot help believing that this is cerat an appropriate future date of the appropriate price reductions.
tainly in our interest. The President has
. agreement with Canada to cover replace- Mr. Chairman, as the President stated done nothing wrong in entering into the ment parts as well as original equip- in his letter to the Speaker, the agree- agreement and asking the Congress to ment, and to demonstrate to countries ment is based on mutual trust and will implement that agreement. other than Canada producing automo- result in mutual benefit benefit to pro- Mr. BYRNES of Wisconsin. Mr. tive products that the United States is ducers, to labor, and to consumers on Chairman, I yield 15 minutes to the genwilling to agree to extend the benefits of both sides of the border. The Secre- tleman from Missouri (Mr. CURTIS]. the United States-Canadian agreement tary of Commerce testified in favor of Mr. CURTIS. Mr. Chairman, again it to them where such agreements would this legislation, as did the Secretary of is my pleasure to state that the chairafford mutual trade benefits. I would Labor and Under Secretary of State man of our committee has carefully and emphasize, Mr. Chairman, that the au- Mann. The “big four” of the U.S. auto- accurately explained the situation. thority to carry out any agreement addin motive industry urged enactment of the
Let me state, lest there be some contional to the present United States-Ca- legislation, and the spokesman of the fusion, since I voted against the rule, I nadian agreement may be exercised only UAW supported the legislation. Canada voted against the rule because it was a if first, prior to the negotiation of such has abandoned her unilateral approach closed rule and I saw no justification for agreement the President obtains advice to improvement of her position in the that. I assure the House that in my from the Tariff Commission on the prob- Canadian motor vehicles market that judgment the Ways and Means Commitable economic effect of the agreement cast a cloud on our good relations and tee has done its homework in this inand provides opportunity for interested has agreed to a joint program that will stance. As the chairman described, we parties to present their views; and sec
allow both countries to share equitably went into this matter as thoroughly as ond, the agreement has lain before the in a growing North American market. I believe we could have, with public hearCongress for 60 days and a concurrent She implemented her obligations under ings and considerable executive sessions. resolution disapproving the agreement the agreement promptly after signa
Let me also say that although I voted is not adopted during that 60-day period. ture—eliminating all relevant duties on against the rule, I believe
this matter is Mr. Chairman, your committee did not imports of U.S. automotive products on ready for floor debate. overlook the concern of certain U.S. in- June 18. She awaits corresponding ac
I shall vote for this bill. On the other dependent parts manufacturers over the tion on our part.
hand, probably most of what I am going possible effect of the agreement with
Mr. GROSS. Mr. Chairman, will the to say will be pointing out the features Canada on their operations. We have gentleman yield?
of this bill that very much bother me. concluded that their fears, which were
Mr. MILLS. I am glad to yield to the
Again the administration presented us based largely on the "secret” agreements gentleman from Iowa.
Mr. GROSS. In the absence of this marks of the gentleman from Iowa [Mr. that turned out to be the letters of un
with a fait accompli. I think the redertaking I previously described, are ex- legislation, how can we revert back to
GROSS] are well taken. This is a fait cessive. Of course, the operation of the where we were? Are we not now where
accompli without any Members of Conagreement may cause some dislocations we were?
Mr. MILLS. No. We would revert sulted ahead of time about the serious among particular parts manufacturers.
gress that I know of having been conBut the fact is that the U.S. independent back to the situation prior to the agree- aspects of this legislation that are inautomotive parts manufacturers stand ment, is what I had in mind.
volved here. Yet the executive knew to gain from the agreement. The Sec
Mr. GROSS. Is the gentleman saying that in order to carry out this agreement retary of Commerce advised your com- that the President of the United States they were going to have to come to the mittee that in his judgment the inde- entered into a most important agreement Congress for authority. pendent parts industry, far from being with Canada without the sanction of the
The reasons for voting for this bill I adversely affected by the agreement; Congress?
think are clearly set out in the commit"should”-and I quote="also benefit
Mr. MILLS. I am not saying that at tee report. It is a good report, I think, from this program, both immediately as all. The agreement speaks for itself. and I hope that
people will read it. Also a result of the termination of the Ca- The elimination of U.S. duties cannot go the minority views should
be read. The nadian duty remission scheme, and in into effect unless this legislation is report sets forth why this bill should be the long run as a result of the projected passed.
enacted. increase in total vehicle sales in the The Congress can pass this, and the
No. 1, because “it is important to North American market." President will have completed his under
United States-Canadian relations.” In Statements have been made that prices taking, which was, “I will ask the Con
my judgment, that is it. of Canadian automobiles have not as yet gress in this session to establish zero rates
However, I must say this and this is been reduced to U.S. levels. These state- of duty under certain circumstances.”
a partisan political remark that I am ments deserve comment.
Mr. GROSS. The President would not
now making—as a member of the minorWith the United States-Canadian clandestinely or otherwise enter into an
ity party, I think it is proper for us agreement in full effect, both countries agreement with Canada or the auto
to call attention of the Congress and the anticipate an expansion of the Canadian manufacturers, would he, without the
people of this country to the number market for automobiles and trucks. sanction of the Congress?
of instances in which the executive This expansion will come about more Mr. MILLS. This is not the first time branch of the Government has in effect rapidly as Canadian automobile prices that an agreement has been entered into, made what I regard as an improper and are reduced; these prices are now about I must say. Does the gentleman from essentially a bad deal and then come 15 percent higher than those in the Iowa find fault with the fact that the before the Congress and said, "Look, United States. However, an immediate President did not first get authority? Is there is nothing for you to do but come and drastic price reduction would cause that the point?
along, because if you do not come very heavy losses and serious injury to Mr. GROSS. Yes; because he is mak- along,”-using the chairman's wordsCanadian companies and Canadian au- ing quite an issue right now of an alleged "if you do not come along, where are we tomobile workers. invasion of his authority by the Congress. going to be?” Now, this is the argu
? I am confident that both governments Mr. MILLS. If we had waited this ment, I might say, that prevails with and the companies intend that there long and no action had been taken, no me. Where are we going to be? I think I am ready to ask on the part of the executive merely announced that it was But here is what it is really doing. minority a little appreciation on the part going to ask the Congress to enact it and It is saying that Canada may insist on a. of the executive branch of the Govern- immediately the Treasury Department certain percentage of the automotive ment for the times that we have gone began printing up tax forms as if it were parts that the automobile companies buy along for this very reason. Indeed, a law, using the date of its announce- in order to manufacture their automopartisan political issue could well be ment as the date of imposing the biles; that that percentage must be made made of a number of these situations. tax. This is moving further and further in Canada. This is bound to affect our To the extent that this can be done to Government by men and away from automobile parts people in the United carefully and properly, it should be done. Government by law, which is the tradi- States. And they have had no voice in Because mind you—and I do not need to tion of this country.
the details of this. You see, there is the say it in this House, with the majority The separate views of the Republicans, tragedy of this. you have here--of course, the other side on page 56 of this report, makes this Hopefully the automobile companies, of the question will be presented ade- statement:
the big companies, will look after the big quately. There are many of you who can
Faced with the possibility of having to take automobile parts dealers, but the parts take the position that this is a good deal retaliatory action, the administration set people have had no real voice. I supand it should be our policy. I disagree.
I disagree. about to find a way to accomplish the pur- pose in theory someone will look after I want to say this: This agreement pose sought by the Canadian Government the United Automobile Workers in the is contrary to the foreign trade policies as and without the risk of penalties.
United States. espoused by this administration, by the
I made a little note on the side—"Faced
But, of course, the United Auto WorkKennedy administration,
and the Eisen- with the possibility of having to take re- ers? union is an international union. hower administration.
This is a viola- taliatory action"--and here is my note This poses an interesting situation betion of GATT. It is not just a technical "by law.” Because the present law pro
cause their union members in Canada violation, but it is a violation of the vides the method whereby those who felt stand to benefit. However, I was wonspirit of GATT. This is just one
that they were aggrieved, our domestic dering how Mr. Reuther resolved this further step in a series of steps that industries, could pursue their remedies. question between the United Auto Workhas been taken in recent years un
This is what the administration was con- ers in the United States versus those in der this administration, which is in fronted with, either following out the Canada. And, one further thing: How discord with the administration's state- laws of the United States for giving jus- about the union members and the nonments as to what its trade policies are.
tice as the laws were written to those union employees of these independent The International Cotton Textile Agree, who were complaining, or forget about parts companies? Where did they have ment is a cartel, an international legal remedies even though they were
a voice in this? There was no voice. cartel, sponsored by our Government being legally pursued and set out to It is interesting to see that in spite of with licenses and quotas. This is the change through executive fiat and hope
the-incidentally, I could not find where most regressive form of regulating trade. the legislative hand would later legalize
the Secretary of Commerce had actually A tariff is the most liberal if you are
said that this was not going to adversely it. going to regulate trade. Then the In
affect the independent automobile parts
I worry about this procedure. If the ternational Coffee Agreement. There was laws are not good, here is the place to industry as stated in the committee reanother of these faits accompli pre- change them. I know that this Congress port. He testified, but I do not think he sented to the Congress. It was pointed and your Committee on Ways and Means made these remarks. I can be in error out that if we did not go along, where
and that is why I am directing attention are responsive to pleas of the adminiswould our friends in Brazil and
so forth tration where the laws need changing. to it, because I would like to have it be? There was legitimacy in the argu- But let us change the laws, Mr. Chair
But let us change the laws, Mr. Chair: pointed up, if he did say it. If he said ment. Interestingly enough, the first time it was before the House I voted for man. Let us not follow this process of it, I believe he is in error.
Mr. BRADEMAS. Mr. Chairman, will setting the laws aside when people have it, although I did then about what I
the gentleman yield? a legitimate right to expect the adminisam doing now. Having said that I was
Mr. CURTIS. I now yield to the gentration to carry them out having the going to vote for it, I did most of my laws set aside while the administration
tleman from Indiana. talking against what had been done and figures out some other method to pursue.
Mr. BRADEMAS. Although I am opthe reasons why I thought it was a very
posed to this legislation, I want to combad deal. But I voted for it and said did receive deep consideration. I, my
This measure, as the chairman said,
mend the gentleman from Missouri (Mr. so, because of the consequences if we did
CURTIS] for his very candid explanation not pass it. This passed the House and self, was going to oppose this until I saw
of it, particularly at two points. went to conference and then I think it the actual agreements of the automobile
The gentleman from Missouri I bemanufacturers with Canada. I want to died in conference without going fur
lieve I am correct in this stated that say to the credit of our automobile comther. So in this session of Congress we
this legislation authorizes a cartel, and had it up again. This time I voted panies that when they testified, they
the gentleman said it is a fair cartel, but against it. Why? Because the admin- laid out on the public record what their
it is a cartel all the same. istration had told the Committee on agreements were. This administration
Mr. CURTIS. I said it is as fair a Ways and Means the previous time they proposal was meaningless when it was
cartel as one could be. I do not even had to have this action of the Congress presented first to the Committee on Ways
go along with this, but if you are going and Means without knowing what the right away. And here we sat around for
to have one, I suppose this is as an unover a year without doing anything agreements were with Chrysler, Ford,
restricted one as there could be. about getting congressional implementa- General Motors, and American Motors.
Mr. BRADEMAS. If the gentleman tion. And I might say, as I view it now,
In the committee hearings you will
will yield further, I appreciate that beoperating without the authority of law. find a record of these agreements, and
cause representatives of the Department Apparently this administration just pro- the committee had an opportunity to in
of State have repeatedly objected to the ceeds to act whether it has received terrogate concerning them.
characterization that some of us who are authority or not. This is what is going
The total of all this is, in my judg
against the bill have made of the agreement, a form, again, of a cartel sponsored ment; namely, that it in effect authoron here.
, The gentleman from Iowa was correct by Government. But I want to say in
izes a cartel, and the word of the gentlein saying that actually this automobile behalf of it that it is as fair a cartel setup
man in the well certainly supports our agreement has been carried out. CusCus- as I have ever seen. From that stand
contention that it does. toms officers are set up computing the point I want to commend our people, be
Mr. CURTIS. Could I say on that they customs, on the assumption that this will cause if they are going to do this kind
expressed their resentment to me, too. become law. This bill itself is retro- of thing—and I do not think we should
Some of my good friends from the auto active to January 18, 1965.
but if we are going to, this is as fair way companies resented my use of this term This is the same procedure followed by to do it and permits as much progress when they were in the office. I said, "Let this administration in the case of the in- through real competition as I think we us go to the dictionary." I do not like terest equalization tax. The Congress can imagine, assuming the cartel tech- to use epithets, I like to use the dictiontook many months to authorize it. The nique is to be followed.
ary definition of terms. According to the